For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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Learn more at nyp.org/amazingadvances
DJIA 19864.09 g 107.04 0.5%
What’s
News
Business & Finance
A pple’s revenue rose 3%
to a record $78.4 billion
in the latest quarter, as
iPhone 7 demand helped
end a string of declines. A1
 Exxon said it wrote down
the value of more than $2
billion in U.S. assets and
posted its lowest annual
earnings in 20 years. B1
 Toshiba plans to stop
building nuclear-power
plants after incurring bil-
lions of dollars in losses
on U.S. projects. B1
 Trump called on drug-
firm CEOs at a White House
meeting to bring manufac-
turing back to the U.S. B1
 Hedge fund Elliott
launched a campaign to
shake up Arconic’s board
and oust CEO Kleinfeld. B3
 Blackstone’s bet on
housing got a push as its
Invitation Homes raised
$1.54 billion in an IPO. B1
 Home prices climbed in
November, showing no signs
of slowing even as mortgage
rates began to tick up. A3
 The eurozone economy
kept pace with that of the
U.S. last year for the first
time since 2008. A8
 The Dow dropped
107.04 points to 19864.09,
ending lower for a third
consecutive session. B15
 Deutsche Bank agreed to
pay $629 million to settle
probes of Russian trades. B14
World-Wide
 Trump tapped Judge
Neil Gorsuch as his Supreme
Court nominee, a choice
that would tilt the court’s
ideological balance back to
conservatives. The pick sets
up another political battle
for the president. A1, A6, A7
 Chances for cross-party
compromise are dimming in
the wake of Trump’s aggres-
sive debut, potentially limit-
ing the scope of what he can
get done while in office. A1
 Senate Democrats de-
layed the confirmations of
several of the president’s
cabinet nominees, a move
reflecting rising tensions. A2
 The Trump administration
and its allies on Capitol
Hill worked to contain the
fallout from the presi-
dent’s travel-ban order. A4
 Canadian police are
weighing whether terror-
related charges should be
brought against the Quebec
mosque attack suspect. A9
 Last-minute sign-ups
continued for health cov-
erage under the ACA,
which Republicans have
pledged to overturn. A3
 Ex-Rep. Weiner could face
child-pornography charges
over alleged exchanges
with a 15-year-old girl. A3
 A U.N. court ordered
Turkey to free an interna-
tional war-crimes judge ar-
rested after the coup bid. A8
CONTENTS
Business News.. B3,5
Crossword.............. A14
Heard on Street. B16
Life & Arts....... A11-13
Management.......... B6
Markets............. B15-16
s Copyright 2017 Dow Jones &
Company. All Rights Reserved
Being a teaching hospital makes us stronger.
Being a teaching hospital for two great medical schools makes us NewYork-Presbyterian.
* * * * * * WEDNESDAY, FEBRUARY 1, 2017 ~ VOL. CCLXIX NO. 25
NASDAQ 5614.79 À 0.02% STOXX 600 360.12 g 0.7%
Trump Taps Gorsuch for High Court
ALEX WONG/GETTY IMAGES
President Donald Trump with his Supreme Court nominee, Judge Neil Gorsuch, and his wife, Louise, Tuesday night at the White House.
GOP, Democrats Dig In for a Fight
WASHINGTON—President
Donald Trump’s aggressive
White House debut is stoking
a war with Democrats and cre-
ating unease with fellow Re-
By Janet Hook,
Kristina Peterson
and Reid J. Epstein
publicans, dimming chances
for cross-party compromise
and potentially limiting the
scope of what he can get done
while in office.
Democrats, pushed by their
base, are under pressure not
to cooperate with the new
president—on anything. On
Tuesday, Senate Democrats
boycotted committee votes on
cabinet nominees and delayed
Man Cave,
Say Hello to
The She Shed
i i i in consumer prices
Women escape to
backyard oases;
‘Just me, all me’
BY ELIZABETH HOLMES
Amy Spearing has a five-
bedroom, 3,000 square-foot
home outside Richmond, Va.
But when she needs a break
from her husband and three
children, she high-tails it out
the back door to her “she
shed.”
“You know how men have
man caves? This is like that, but
for women,” says the 42-year-
old interior designer, whose
children are ages 10, 13 and 16.
“If I was inside, someone would
be screaming, ‘Mom!’”
After years fighting for a
seat at the table, some women
now want their own place. Ms.
Spearing converted her back-
Opinion.............. A15-17 yard pool house into a Parisian-
Property Report... B8
Sports....................... A14
theme oasis with a brass chan-
Technology............... B4 delier and bistro table. She
U.S. News............. A2-7 retreats there every day.
Weather................... A14 “It’s something women
World News..... A8-10
didn’t know we needed until
someone said, ‘She shed,’” Ms.
> Spearing says. “I feel a lot
calmer out there.”
She sheds are havens to
paint, read, do yoga, host a
book club meeting; a place to
leave behind the demands of
Please see SHED page A10
10-YR. TREAS. À 10/32 , yield 2.451%
at least for a day a committee
vote on Mr. Trump’s choice for
attorney general.
The battle is now poised to
move to the most hard-fought
political arena in Washington:
the appointment of a U.S. Su-
preme Court justice who will
get a lifetime job judging pol-
icy on immigration, taxes,
abortion and a host of other
constitutional issues that
evoke partisan passions.
Mr. Trump Tuesday evening
announced he would appoint
Judge Neil Gorsuch to the Su-
preme Court.
Some Democrats are pledg-
ing to block the nomination,
quickly injecting politics into the
debate after Republicans spent
much of last year blocking Presi-
Inflation, Finally
After years of deflation worries,
consumer prices around the world
are showing signs of life. A8
Change from a year earlier
U.S. EU Japan
2.0%
1.5
1.0
0.5
0 giant is emerging from its
–0.5
–1.0
2015 ’16
Note: Japan’s CPI excludes fresh food
Source: Federal Reserve Bank of St. Louis
(U.S); Eurostat (EU); Ministry of Internal
Affairs and Communications (Japan)
THE WALL STREET JOURNAL.
NFL Calls New Plays
To Protect Franchise
BY MATTHEW FUTTERMAN
The Super Bowl, normally a
celebration of the National
Football League’s cultural and
financial power, this year
comes as the league searches
for ways to bolster the game
to tighten its grip on the pub-
lic’s attention.
The NFL has begun experi-
menting with shuffling the way
ads appear in game broadcasts,
and it is considering making
the weekly lineup of games
easier to find on television as
OIL $52.81 À $0.18
dent Barack Obama’s Supreme
Court pick, Merrick Garland.
Many Republicans, rattled
by some of Mr. Trump’s early
moves, remain in the shadow
of his high popularity with the
GOP base. They have for the
most part rallied behind the
president and his agenda—
even on trade policies many
shunned before his election.
The result is that Mr.
Trump faces more immediate
obstacles to realizing goals
that can’t be achieved through
the stroke of an executive pen.
While the president is ex-
pected to win confirmation of
most of his cabinet nominees
and Republicans have said
they are confident the Senate
will confirm his Supreme
Apple Breaks Losing Streak,
As Sales of iPhone 7 Shine
BY TRIPP MICKLE
Apple Inc. snapped out of
three straight quarters of fall-
ing revenue as strong demand
for the iPhone 7 raised inves-
tors’ hopes that the technology
roughest period since it rein-
vented the market for mobile
devices.
’17
Sales of the new smartphone
model, which Apple unveiled in
September, propelled total
iPhone shipments 5% higher to
a record during the three
months through December.
iPhones, which account for
well as tweaking the pace of
the sport itself.
Ahead of Sunday’s champion-
ship matchup between the New
England Patriots and Atlanta
Falcons, NFL Commissioner
Roger Goodell on Wednesday
plans to use his annual state-of-
the-game press conference to
stress that the league is serious
about making changes amid
steep ratings declines and other
problems, people involved in
preparations said.
The league’s desire to pro-
Please see NFL page A7
WSJ.com
GOLD $1,208.60 À $15.40
Court choice, the Democrats
have the power to delay and
potentially block legislation
they find objectionable.
Republicans hold 52 seats
in the Senate, and most bills
need 60 votes to pass. Alienat-
ing Democrats would doom
most legislative efforts, in-
cluding a plan to replace the
Affordable Care Act after Re-
publicans repeal it with a
party-line maneuver tied to
the budget.
Senate Republicans will
need to persuade a handful of
Please see DIVIDE page A2
 Democrats delay several
cabinet confirmations........... A2
 GOP tries to contain fallout
from travel ban........................ A4
two-thirds of Apple’s sales,
helped boost total revenue 3%
to a record $78.4 billion.
Apple’s services business—
which includes its App Store
sales and its music and pay-
ments services—continued to
boom. Revenue in that segment
jumped 18% from a year ago to
$7.2 billion, making it bigger
than many large companies. It
had nearly three times the
sales of Netflix Inc. during the
same period.
Apple Chief Executive Tim
Cook said in an interview he
expects services revenue to
double over the next four years.
INSIDE
A MUSEUM
INNOVATOR AT
THE VATICAN
LIFE & ARTS, A11
ADVERTISEMENT
HHHH $3.00
EURO $1.0798 YEN 112.81
Choice of conservative
appellate judge from
Colorado sets up next
political battleground
BY MICHAEL C. BENDER
AND BRENT KENDALL
President Donald Trump
picked Judge Neil Gorsuch as
his nominee to the U.S. Su-
preme Court, a choice that
would fill a nearly year-long
vacancy on the bench and
amount to the most transfor-
mational decision of his event-
ful first 12 days in office.
Mr. Trump’s choice, an-
nounced Tuesday evening at the
White House, would tilt the ide-
ological balance of the nation’s
highest court back to conserva-
tives, a promise he made for
months from the campaign trail
as he aimed to attract fellow
Republicans to his candidacy.
“The qualifications of Judge
Gorsuch are beyond dispute,”
Mr. Trump said, describing his
pick as “a man who our country
needs badly to ensure the rule
of law and the rule of justice.”
The choice will set off an-
other political battle for Mr.
Trump, whose first two weeks
in office have been marked by
almost daily clashes with Demo-
crats, fellow Republicans and
even within his fledgling admin-
istration. Republicans immedi-
ately praised the choice while
Democrats, under pressure from
their party’s base to stymie the
new administration, predicted a
rough path to confirmation.
“The burden is on Judge Neil
Gorsuch to prove himself to be
within the legal mainstream,”
Senate Minority Leader Chuck
Schumer (D., N.Y.) said. He
added that Judge Gorsuch had
Please see COURT page A6
Court’s Turn
 Nominee for Scalia’s spot
fits mold................................. A6
 Announcement’s TV flair
breaks with tradition........ A6
 Gorsuch record has pro-
business tilt.......................... A7
“There’s a lot to feel great
about,” Mr. Cook said.
Apple’s shares rose more
than 3% after normal trading
hours Tuesday to more than
$125 each. The stock is now
only about 6% off its all-time
closing high of $133 reached in
February 2015, after having
fallen to about $90 last May.
“If they’re an eight-cylinder
sports car, then they’re firing
on seven out of eight cylinders
which is very, very impressive
Please see APPLE page A10
 Heard on the Street: Ready
for next ‘supercycle’............ B16
INCOMPETENCE
HAS BECOME
NORMAL
OPINION, A15
 For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
A2 | Wednesday, February 1, 2017
Democrats Skip Cabinet Hearings
BY NICK TIMIRAOS
AND SIOBHAN HUGHES
WA S H I N G T O N — D e m o -
crats delayed the confirma-
tions of several of President
Donald Trump’s cabinet nomi-
nees Tuesday in a move that
reflects rising tension in a
Senate adjusting to Republican
control of the government.
Democrats on the Senate
Finance Committee held up
votes for three cabinet picks—
Sen. Jeff Sessions for attorney
general, Steven Mnuchin for
Treasury secretary and Rep.
Tom Price for Health and Hu-
man Services secretary—amid
growing pressure from liberals
to resist Mr. Trump’s agenda
and concern that some of the
nominees haven’t been candid
with lawmakers.
The moves infuriated Re-
publicans, who complained
Democrats were unfairly hold-
ing up key slots in Mr.
Trump’s cabinet.
“The only chaos we have in
the Senate is because of Sen-
ate Democrats,” said Senate
Majority Leader Mitch McCon-
nell (R., Ky.). “The president is
entitled to have his cabinet
appointments.”
Each of the jobs is at the
center of Mr. Trump’s effort to
quickly advance his agenda,
which includes changing immi-
gration and national security
policy and repealing the Af-
fordable Care Act.
DREW ANGERER/GETTY IMAGES
Sen. Orrin Hatch, surrounded by empty seats, confers with an aide during a meeting of the Senate Finance Committee to vote on cabinet nominees on Tuesday.
DIVIDE
Continued from Page One
Democrats to allow legislation
to move forward or take ex-
traordinary measures to
change the chamber’s rules to
permit measures to advance
with a majority vote.
Leadership from both par-
ties have resisted changing
the vote rules because the
Senate, unlike the House, is
more prone to flipping be-
tween Republican and Demo-
cratic control. The Senate
also has a longstanding tradi-
tion of seeking bipartisan so-
lutions.
“We Democrats need to be
very forceful,” Washington
Gov. Jay Inslee said in an in-
terview. “The goal of those
who value liberty is to fight
back whenever, wherever and
however,” he said.
White House spokesman
Sean Spicer rebuffed sugges-
tions that Mr. Trump’s first
weeks in office have been divi-
sive, noting that he has met
with Democrats as well as Re-
publicans, union members as
well as businesses.
“The president has done a
tremendous amount through
both what he has said and
done, more importantly, to
start to bring this country to-
gether,” Mr. Spicer said Tues-
day. “And his policies, frankly,
are focused on keeping every
American safe.”
Far from Washington, Mr.
Trump’s breakneck style of
Stock Deal Delays
Price Appointment
The top Democrat on the
Senate Finance panel said Tues-
day he was holding up the ap-
pointment of Rep. Tom Price for
Health and Human Services
secretary because of a Wall
Street Journal article that con-
tradicted testimony Mr. Price
gave last week.
The article said Mr. Price
participated in a private stock
offering open to fewer than 20
individuals after hearing about
the offering from Rep. Chris Col-
lins, who sits on the board of
the company. In a hearing, Mr.
Price said the stock offering
was open to all investors in the
company, Innate Immunothera-
peutics, which is developing a
drug for multiple sclerosis.
Mr. Trump already has fired
acting Attorney General Sally
Yates for telling government
lawyers not to defend an exec-
utive order suspending immi-
gration from seven nations out
of concerns terrorists from
those countries might enter
the U.S. Mr. Trump’s pick for
Health and Human Services
secretary is key to the admin-
istration’s efforts to unwind
parts of the health-care law.
Democrats defended their
governing has thrown many
Republicans for a loop, even
though he is doing what he
promised during his campaign.
“It’s reassuring to have a
candidate who is now presi-
dent actually doing what he
said he would do—that’s a
breath of fresh air,” said Rob-
ert Graham, Arizona’s GOP
chairman. “But he’s moving so
quickly, it does put you back
on your heels a little bit.”
Political observers believe
Mr. Trump bears some respon-
sibility for the absence of a
honeymoon.
He has led off with conten-
Republicans hold 52
seats in the Senate,
and most bills need
60 votes to pass.
tious issues—most notably im-
migration—that delight his fol-
lowers and alienate Democrats,
and he has used his Twitter
feed to call his adversaries
names, including “clowns.” Even
some Republicans have said Mr.
Trump has made little effort in
his opening days to appeal to
Democrats to work with him.
“I don’t think that’s his goal
right now,” Sen. Bob Corker, a
Tennessee Republican, said.
“It’s definitely a very strident
tone that’s being set.”
That has complicated Dem-
ocrats’ hopes to work with Mr.
Trump on issues like an infra-
U.S. NEWS
“The evidence is the com-
pany is directly contradicting
Congressman Price,” Sen. Ron
Wyden of Oregon said.
Mr. Price sat on a House
panel that worked on legislation
to speed up the process for
drug approvals.
Mr. Price invested between
$50,000 and $100,000 in the
offering, according to his disclo-
sure form. Mr. Price’s purchases
were priced at a 12% discount
to the market value of the com-
pany, securities disclosure docu-
ments state.
A spokesman for Mr. Price
didn’t respond to requests for
comment and referred to earlier
statements issued by Mr. Price’s
spokesmen. Mr. Price previously
has said he has done nothing
wrong and that he disclosed all
his trades.
—James V. Grimaldi and
Michelle Hackman
moves, which relied on little-
used procedural courtesies in
Senate rules.
“These nominees are not
what Donald Trump promised
and not what represents
American middle-class values,”
said Senate Minority Leader
Chuck Schumer (D., N.Y.).
Mr. Trump’s pick for Labor
secretary, fast-food executive
Andy Puzder, had his confir-
mation hearing put off again
amid questions about his eth-
structure bill. He also inflamed
liberal activists and the Demo-
cratic base, who have poured
into the nation’s streets, air-
ports and public squares
across the country to protest
his policies.
Mr. Obama, a Democrat,
helped fan the flames this
week. He said in a statement
that he was “heartened” by
the protests, marking his first
public comment since leaving
the White House.
Democratic activists are
marshaling their supporters to
counter Mr. Trump.
“Until and unless Donald
Trump decides to operate
within the Constitution, Demo-
crats should be shutting the
process down,” said Ben Wikler,
Washington director of Mo-
veOn.org, a liberal activist
group.
On Monday afternoon, Sen.
Bernie Sanders’s political arm,
Our Revolution, asked the five
million people on the Vermont
independent’s email list to de-
mand Democratic senators re-
sist Mr. Trump’s agenda by de-
laying votes on cabinet
appointees as long as possible.
A link in the email routed
10,000 calls to Senate Demo-
crats between 3 p.m. Monday
and Tuesday morning before
the Senate committee walkout,
said Larry Cohen, chairman of
Our Revolution. MoveOn also
says it routed another 10,000
calls to Democratic senators.
Those calls are getting
through to lawmakers like Sen.
Angus King of Maine, an inde-
pendent who caucuses with
ics and financial paperwork.
The Senate panel oversee-
ing Mr. Puzder’s nomination
won’t schedule a confirmation
hearing until it receives his
paperwork from the Office of
Government Ethics, a Republi-
can aide said. No new date
was set on Tuesday.
Democrats on the Senate
Finance Committee boycotted
a planned vote on Messrs.
Mnuchin and Price, saying
they wanted more information
from the nominees. The vote
on Mr. Mnuchin had been re-
scheduled once and Democrats
have already signaled plans to
oppose the picks. Committee
rules require at least one
member from each political
party to be present to conduct
business.
The panel’s top Democrat,
Sen. Ron Wyden of Oregon,
said he was acting because of
contradictory information
about his participation in a
private stock offering.
Republicans sharply ob-
jected to the delay from a half-
empty committee room, call-
ing it obstructionism. “I’ve
been here a long time and I’ve
never seen anything like this
before...I’ve always shown up,”
said Senate Finance Commit-
tee Chairman Orrin Hatch (R.,
Utah).
Mr. Hatch said he would re-
schedule the hearing for the
Treasury and Health and Hu-
man Services nominees.
Democrats.
“There certainly are many—
and we’re hearing from
them—who want me to vote
against anything and every-
thing” proposed by Mr. Trump,
Mr. King said.
Activists still face reluctance
from senators who shy from
unalloyed obstructionism.
“If he’s right, I’m with him.
If he’s wrong I’m going to op-
pose him,” Mr. King said.
The pressure is especially
intense on Senate Minority
Leader Charles Schumer, a
New York Democrat who be-
fore the inauguration spoke
CORRECTIONS  AMPLIFICATIONS
Five people from countries
that made up the former Yu-
goslavia have been arrested
since Sept. 11, 2001, for al-
leged terrorist crimes in the
U.S. In some editions Tuesday,
a U.S. News graphic listing the
nationalities of people who
committed terror attacks or
were arrested for alleged
crimes related to terror plots
incorrectly indicated that five
people were from Yugoslavia.
Alcoa Inc. was renamed
Arconic Inc. when it spun off
its raw aluminum business in
November. The headline of a
Page One article Tuesday
about shareholder concerns
over Arconic’s leadership in-
Readers can alert The Wall Street Journal to any errors in news articles by
emailing wsjcontact@wsj.com or by calling 888-410-2667.
* ***
Tuesday’s delays aren’t un-
precedented. In 2013, all Re-
publican members of the Sen-
ate Environment and Public
Works Committee didn’t at-
tend a meeting to consider
President Barack Obama’s pick
to lead the Environmental Pro-
tection Agency, Gina McCar-
thy, forcing a delay. She was
eventually confirmed.
Democratic lawmakers at-
tacked Mr. Sessions at the
Senate Judiciary Committee,
where a vote on his nomina-
tion was put off for one day,
saying he lacked the indepen-
dence of the recently fired act-
ing attorney general, Ms.
Yates. The panel is expected to
vote Wednesday to forward
Mr. Session’s nomination to
the full Senate.
While Democrats on the
Senate Finance panel focused
primarily on Mr. Price, other
Democratic senators objected
to written testimony Mr.
Mnuchin had made after his
confirmation hearing earlier in
January regarding foreclosure
practices at OneWest Bank,
the lender he rehabilitated af-
ter purchasing the former
IndyMac Bank from the gov-
ernment.
A spokesman for Mr.
Mnuchin disputed claims that
the written testimony wasn’t
truthful.
—Michelle Hackman, Devlin
Barrett and Eric Morath
contributed to this article.
often of cooperating with Mr.
Trump when the new presi-
dent’s priorities aligned with
what Democrats have sought.
At a rally with more than
100 Democratic members of
Congress in front of the Su-
preme Court on Monday, pro-
testers shouted “do your job”
at Mr. Schumer to encourage
him to try to block Mr.
Trump’s cabinet appointees.
Mr. Schumer said Monday
he would oppose five of Mr.
Trump’s cabinet nominees. On
Tuesday he also voted against
a sixth, Transportation Secre-
tary Elaine Chao.
correctly described Arconic as
a spinoff of Alcoa.
A one-quarter ounce enve-
lope of active dry yeast is
needed for the pide dough rec-
ipe that appeared in Off Duty on
Saturday. The published recipe
incorrectly called for a 1¼-ounce
envelope of active dry yeast.
Patrick T. Fallon of
Bloomberg News provided the
photo of Sony Corp. CEO Kazuo
Hirai that appeared Tuesday
with a Business & Finance arti-
cle about Sony’s write-downs
for its film and TV studio. In
some editions, the credit was
incorrectly given to Hopper
Stone of Associated Press.
THE WALL STREET JOURNAL.
U.S. WATCH
NORTH DAKOTA
Pipeline Project Gets
Go-Ahead: Senator
The U.S. Army Corps of Engi-
neers was given the green light
to proceed with the final permit
necessary to finish the Dakota
Access Pipeline, according to
North Dakota Sen. John Hoeven.
Mr. Hoeven, a Republican, said
in a statement late Tuesday that
during a meeting with Vice Presi-
dent Mike Pence and acting Sec-
retary of the Army Robert Speer,
Mr. Speer said he directed the
Army Corps “to proceed with the
easement needed to complete
the Dakota Access Pipeline.”
In December, the U.S. Army
Corps of Engineers, under the di-
rective of the Obama administra-
tion, denied the permit needed
to complete the last leg of the
$3.8 billion pipeline being built by
Energy Transfer Partners.
The Standing Rock Sioux
Tribe, the main group opposing
the pipeline, says the project
could pollute its water supplies
and disrupt its sacred lands.
—Will Connors
SAN FRANCISCO
Suit Filed Over Order
On ‘Sanctuary Cities’
San Francisco officials are su-
ing the Trump administration
over an order to cut off federal
funds to cities that shelter un-
documented immigrants.
The lawsuit, filed Tuesday in
federal court, called the executive
order unconstitutional and “a se-
vere invasion of San Francisco’s
sovereignty.” San Francisco and
cities such as Boston, Los Angeles
and New York have vowed to pro-
tect undocumented immigrants by
refusing to direct local police to
enforce federal immigration law.
Some have set aside money to
help fund immigrants’ legal battles.
President Donald Trump’s order
says that by doing so, these “ju-
risdictions have caused immeasur-
able harm to the American people
and to the very fabric of our re-
public.” The order directs govern-
ment agencies to strip funding
from so-called sanctuary cities.
San Francisco leaders said Mr.
Trump’s order exceeds presidential
power. The White House didn’t
respond to requests for comment.
—Alejandro Lazo
FLORIDA
Planned Budget Aims
At Ports’ Cuba Trade
Republican Gov. Rick Scott
threatened in his proposed budget
to cut off funding for improvements
at the state’s ports if they pursued
deeper trade ties with Cuba.
The budget bars $177 million in
seaport funding from being put to-
ward projects that “result in the ex-
pansion of trade” with Cuba, and
comes after Mr. Scott said in
tweets last week that he opposed
plans by ports in Palm Beach and
Fort Lauderdale to sign agreements
with visiting Cuban delegations.
Work to license firms seeking
to do business in Cuba came to
a virtual halt after the election of
President Donald Trump, as offi-
cials and businesses in Cuba and
the U.S. wait to see policies Mr.
Trump will put forward. After the
governor’s tweets, the Palm
Beach and Fort Lauderdale ports
said they wouldn’t sign planned
memorandums of understanding
with the Cuban delegations.
A spokeswoman for Mr. Scott
wrote in an email that “while the
governor does not support doing
business with the Castro regime,
ports receive state funding and
private businesses do not.”
—Erica E. Phillips and
Arian Campo-Flores
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THE WALL STREET JOURNAL. Wednesday, February 1, 2017 | A3

U.S. NEWS

Education Pick Faces a Test of Test Scores

Betsy DeVos to inherit which looked at schools that steadier improvements made
Stuck in Neutral received grants between 2010 under former President
system with rising Average scores in math and and 2013, found the program George W. Bush, who took of-
graduation rates, but reading were essentially flat on “had no significant impacts on fice in 2001. Minority students
the most recent National math or reading test scores, also posted larger advances
stagnant performance Assessment of Educational high school graduation, or col- under Mr. Bush.
Progress. lege enrollment.” “Under the Bush years, the
BY TAWNELL D. HOBBS The grant program, started gains were stronger than un-
BRENDAN SMIALOWSKI/AGENCE FRANCE-PRESSE/GETTY IMAGES

290 in 2001, expanded significantly der the Obama years,” said

8th grade math score
If confirmed as education 280 under Mr. Obama, with $7 bil- Peggy Carr, acting commis-
secretary by the U.S. Senate, lion in awards going to more sioner of the National Center
270 8th grade reading score*
Betsy DeVos will take over a than 1,800 schools since 2009, for Education Statistics, an
national education system 260 according to the Department arm of the Education Depart-
with an improving graduation 250 of Education. ment. “It’s slowed down.”
rate but stagnant test scores, Robin Lake, director of the Urban districts have shown
240 4th grade math score
despite a reform effort under Center on Reinventing Public continued improvement in math
the Obama administration that 230 Education, a research and pol- and reading since 2003, al-
pumped billions of dollars into 4th grade reading score icy analysis center, said some though those scores still remain
220
the worst-performing schools. states and cities with strong under the national average.
Ms. DeVos, President Donald 210 plans did well under the grant Some education observers
Trump’s nominee, passed a key 2000 ’03 ’05 ’07 ’09 ’11 ’13 ’15 program, but not as a whole. and teachers unions question
Senate committee vote on “The overall story there is whether Ms. DeVos, a Michi-
*No test data for 2000
Tuesday, but she faces what Source: National Center for Education really depressing, it’s frustrat- gan billionaire who never at-
could be a close vote in the full Statisics ing,” Ms. Lake said. tended public schools, is quali-
Senate, likely sometime next Education secretary nominee Betsy DeVos at a confirmation hearing. THE WALL STREET JOURNAL. Former Education Secretary fied to lead the nation’s
week. She would likely main- John B. King Jr. couldn’t be education department and
tain her commitment to expand mation hearing in January. former President Barack port Card, a measure of stu- reached to comment. He has help make improvements.
the use of charter schools and Ms. DeVos, who declined to Obama, billions of dollars in dent achievement. The perfor- said that patience is needed Her answers to some ques-
vouchers for students to attend be interviewed for this article, grants have targeted struggling mance could provide when improving schools. As a tions during her confirmation
private school, a departure for has spent decades advocating schools and charter enrollment validation for Ms. DeVos to sign of progress, he has hearing, including ones about
a top administrator of an edu- for the school-choice movement has grown. The administration push her ideas for education. pointed to the improved grad- enforcement of the federal In-
cation system built largely on and was an architect of Detroit’s also used competitive grants to Adding to concerns about uation rate, which increased to dividuals with Disabilities Edu-
traditional public schools. charter system. She hasn’t pro- nudge states to adopt Common the current state of the na- a record 83% in 2014-15, the cation Act, increased concerns.
“I’m a firm believer that vided an overarching plan for Core, academic standards that tion’s schools was a federal re- most recent year available, But supporters say that her
parents should be empowered education, but Mr. Trump has outlined what students should port in January on School Im- from 79% in 2010-11. 30-plus years dedicated to bol-
to choose the learning envi- said he would prioritize steer- know in reading and math. provement Grants, a signature But reading and math test stering school choice and help-
ronment that’s best for each of ing an additional $20 billion of But reading and math effort of the Obama adminis- scores have been flat or had ing low-income families have
their individual children,” Ms. federal funds to school choice. scores were essentially flat on tration to help the lowest-per- small increases from 2009 to better educational options
DeVos said during her confir- Under the administration of the most recent Nation’s Re- forming schools. The report, 2015, following bigger and makes her right for the job.

Home Amid Political Rancor, ACA Hits Deadline

Prices BY LOUISE RADNOFSKY a.m. Tuesday. That is a tactic
used at times of high volume

Extend Last-minute sign-ups for

coverage under the Affordable
Care Act continued across the
to keep the site from crashing;
users are invited to proceed
slowly. The Obama administra-

Record country Tuesday.

The “open enrollment” sea-
son for 2017 coverage book-
NICK AGRO/THE ORANGE COUNTY REGISTER/SCNG/ASSOCIATED PRESS tion had allowed people still in
waiting rooms when the mid-
night deadline for sign-ups
BY LAURA KUSISTO ended the tumultuous presi- passed to complete their appli-
dential transition. It began a cations later, and it is not yet
Home prices climbed week before Election Day de- clear if the Trump administra-
strongly in November, as price livered sweeping victories to tion will follow that policy.
growth showed no signs of Republicans promising to The dozen states that oper-
slowing even after mortgage overturn the health law they ate their own sign-up sites for
rates began to tick up during dub Obamacare, and it was set coverage under the law have
the month. to finish 11 days after Demo- more leeway.
The S&P CoreLogic Case- crats relinquished control of a Covered California, the site
Shiller Indices covering the en- government tasked with im- serving that state, announced
tire nation rose 5.6% in the 12 plementing the law. it was giving residents who at-
months ended in November, up The furor intensified last tempted to enroll by the Jan.
slightly from the revised 5.5% week when supporters of the 31 deadline four more days to
year-over-year increase re- law accused the Trump admin- complete their enrollment.
ported in October. istration of trying to block ad- On Friday, the Department
The 10-city index gained vertising reminding people of of Health and Human Services
4.5% over the year, up from the Tuesday night deadline for said it had pulled back $4 mil-
4.3% in October and the 20- most people to sign up for in- lion to $5 million of television
city index gained 5.3% year- dividual coverage through An agent for California’s health program explains options to a man looking to enroll. and radio advertising about
over-year, up from a 5.1% in- HealthCare.gov or its state the sign-up deadline, with the
crease in October. equivalents. The Trump ad- had coverage, including soar- sign-up day. sent on Tuesday. Descriptions intention of returning the
The hottest markets in the ministration had said it was ing premiums and higher out- Nationwide, about 8.8 mil- of the Jan. 31 date also ap- funds to the Treasury.
country remain concentrated reluctant to spend more to of-pocket costs. But the party lion people had signed up for peared on the agency’s official The former chief marketing
in the Northwest, as many promote what it called a fail- also hasn’t coalesced around a coverage by Jan. 14, the De- Twitter account. officer for HealthCare.gov,
buyers priced out of the Sili- ing program. replacement plan that would partment of Health and Hu- Sign-ups in Florida were Joshua Peck, said he didn’t see
con Valley area flee to second- As many as 20 million insure those who now get cov- man Services said on Jan. 18, “busy and steady” on Tuesday, how HHS could successfully
ary tech hubs. Seattle led the Americans have received pri- erage under the law. the last date numbers were re- said Jodi Ray, grant director recoup any part of its existing
way with a 10.4% increase, vate coverage or Medicaid as a But people in states that leased. That was roughly level for the University of South contract with Weber Shand-
Portland reported a 10.1% year- result of the 2010 law, and rely heavily on federal adver- with 8.7 million at the same Florida’s statewide enrollment wick, the advertising firm
over-year gain and Denver had Democrats say Republican at- tising to promote the health point last year, it said. project. tasked with running the out-
an 8.7% annual increase in tempts to repeal the law would law said they had continued to Email alerts for individuals Ms. Ray said she received reach campaign for Health-
home prices. leave many in distress. Repub- see promotional material who visited HealthCare.gov an email from HealthCare.gov Care.gov, and that it would be
Home prices set a record in licans respond that the ACA through the final days of the but didn’t sign up went out announcing the site was plac- difficult for the firm to yank
September and have continued has prompted widespread dis- sign-up period and that activ- daily starting Friday after- ing some visitors in online any committed television or
climbing by more than 5% ruption for people who already ity was typical for the final noon, with multiple reminders “waiting rooms” at around 11 radio advertising.
year-over-year since then.
“One can argue that housing
©T&CO. 2017. DESIGNS © PALOMA PICASSO

has recovered from the boom-

bust cycle that began a dozen
years ago,” said David Blitzer,
managing director at S&P Dow
Child-Pornography Charges
Jones Indices.
The volume of sales has
cooled in recent months, as
Weighed in Weiner Case
rising mortgage rates have col-
lided with higher prices and a BY ERICA ORDEN
shortage of inventory. Pur- AND NICOLE HONG
chases of previously owned
homes slid 2.8% in December Federal prosecutors are
from a month earlier, the Na- weighing bringing child-por-
tional Association of Realtors nography charges against for-
said last week. U.S. new-home mer Rep. Anthony Weiner over
sales dropped by 10.4% in De- sexually explicit exchanges he
cember, the Commerce Depart- allegedly had with a 15-year-
ment said Thursday. old girl, according to people
Case-Shiller offers a lagging familiar with the matter.
JOE RAEDLE/GETTY IMAGES

indicator of the housing mar- Mr. Weiner, a New York

ket and November’s numbers Democrat, is being investi-
reflect only the beginning of a gated by the U.S. attorney’s of-
sharp increase in mortgage fice in Manhattan and the Fed-
rates that began around the eral Bureau of Investigation,
election in November. Average which seized his electronic de-
rates for 30-year fixed mort- vices, including a laptop and a
gages rose from roughly 3.5% cellphone, as part of the probe. Anthony Weiner at the Democratic National Convention in July.
around Election Day to 4.32% Officials initiated the inves-
at the end of December, ac- tigation last fall, after the which the defendant pleads of the 2016 presidential race,
cording to mortgage company Daily Mail in the U.K. reported guilty in exchange for a less- when FBI Director James Love is...
Freddie Mac. In the past week that Mr. Weiner had exchanged severe charge. Comey disclosed that FBI
they averaged 4.19%, Freddie
Mac said Thursday.
sexually explicit messages and
photos with the girl.
Mr. Weiner could face the
production charge, some of the
agents had discovered a laptop
with emails that might be re- WHEN YOU FINALLY
Higher mortgage rates tend
to put a damper on price
In recent weeks, according
to some of the people familiar
people familiar with the case
say, because he allegedly solic-
lated to the probe of a private
email server used by Demo- SPELL IT OUT
growth because they drive up with the matter, lawyers for ited explicit images from the cratic presidential nominee
PALOMA’S GRAFFITI
the monthly cost of a mort- Mr. Weiner have had discus- teenager. Prosecutors also are Hillary Clinton while she was
gage. That combined with sions with federal prosecutors weighing other charges, in- secretary of state. The emails
prices that have risen faster in Manhattan in hopes of dis- cluding receipt of child por- turned out to have been on a
than incomes could pose chal- suading them from bringing nography, for which conviction laptop used by Mr. Weiner and
lenges to the market this year. charges, or at least from carries a five-year mandatory his now-estranged wife, Huma
Cooling rent growth also could bringing the most serious one: minimum. Abedin, a top aide to Mrs.
put downward pressure on production of child pornogra- Prosecutors could decide Clinton.
home prices as purchases be- phy, which carries a 15-year not to bring any charges. Mr. Comey ultimately an-
gin to look less attractive than mandatory minimum prison Mr. Weiner has said he nounced, two days before the
renting. Developers, mean- sentence upon conviction. might have been the victim of election, that the search of the
while, could shift more to sin- These types of discussions a hoax. laptop had turned up nothing 800 843 3269 | TIFFANY.COM
gle-family building, easing can indicate both sides are try- The criminal probe into Mr. to change the decision not to
supply pressures. ing to reach an agreement in Weiner upended the final days charge Mrs. Clinton.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
A4 | Wednesday, February 1, 2017 P W L C 10 11 12 H T G K B F A M 1 2 3 4 5 6 7 8 9 O I X X ** THE WALL STREET JOURNAL.

U.S. NEWS

GOP Tries to Contain Travel-Ban Fallout

Ryan defends Trump some serious injustice to travel- pending court cases. And the

order as necessary;
DHS chief says agency
resolved problems
BY LAURA MECKLER
AND SIOBHAN HUGHES
WASHINGTON—The Trump
administration and its allies on
Capitol Hill worked Tuesday to
contain the damage from the di-
visive executive order suspend-
ing entry to the U.S. for refu-
ers coming into and leaving” Some Nations May administration faced continued
the U.S. He added, “It clearly backlash among a wide range of
was done without thought Face Longer Bans technology and other compa-
ahead of time as to the impact.” nies confused about how to im-
The Homeland Security De- plement the order or outright
partment said 721 people from Homeland Security Secre- opposed to it.
the seven affected nations had tary John Kelly said Tuesday In Boston on Tuesday, attor-
been denied entry but that that some of the countries sub- neys manned the exits from
1,060 who are lawful permanent ject to a temporary ban on im- the customs-screening area at
residents and another 75 had migration and travel to the U.S. Logan International Airport’s
been given waivers from the may remain on the list longer terminal E, looking for passen-
temporary ban. There was con- than the 90 days mandated by gers who needed help. Their
siderable confusion at first as to Friday’s executive order. pink signs read, “I’m a lawyer.
whether legal permanent resi- At a news conference, Mr. Do you need help?” in both
dents, or green-card holders, Kelly said reviews of the pro- English and Farsi.
ANDREW HARNIK/ASSOCIATED PRESS

gees and travelers from seven
Muslim-majority nations, saying
that protecting the country
from potential terrorist attacks
was worth the rocky start.
House Speaker Paul Ryan
said Tuesday that confusion
over the order was regrettable.
But he defended the order as in
line with past congressional
votes and necessary to ensure
proper vetting of travelers is in
place. “The president has a re-
sponsibility to secure this coun-
try,” the Wisconsin Republican
told reporters.
Homeland Security Secretary
John Kelly defended his
agency’s performance, telling a
news conference that any prob-
lems were quickly resolved.
But Sen. Dick Durbin of Illi-
nois, the No. 2 Democrat in the
Senate, said: “The president’s
executive orders resulted in
were included in the order. Offi- gram are under way, but Attorneys said travelers
cials now say green-card hold- added: “Some of these coun- from the seven affected coun-
ers will be allowed to return to tries may not be taken off tries have been encouraged to
the country. the list anytime soon.” fly to Boston because they be-
Officials confirmed that 872 The order suspends immi- lieve a local federal court’s
refugees who were previously gration from seven Muslim- seven-day restraining order
cleared to come to the U.S. will majority nations and bans against the presidential order
arrive this week. Syrian refugees indefinitely. is particularly restrictive.
President Donald Trump has —Laura Meckler Speaking alongside Mr.
said the travel restrictions are Homeland Security Secretary John Kelly on Tuesday Kelly in Washington on Tues-
needed until “extreme vetting” day, the acting commissioner
can be put into place. Mr. Kelly part of what then-candidate til Tuesday that the agency nomination of Sen. Jeff Sessions of the Customs and Border
said that might include a look Trump talked about for a year posted a question-and-answer for the attorney-general post is Protection agency, Kevin
the websites a person visited or or two, so we knew all that was explanation on its website. Such still pending in the Senate. McAleenan, allowed that all
“telephone contact information coming,” he said. details are usually rolled out Democratic senators at- had not gone well with the
so that we can see who they’re People familiar with the contemporaneous with an order. tacked Mr. Sessions on Tuesday, order’s first days.
talking to.” preparations said Mr. Kelly had Also Tuesday, Dana Boente, saying he lacked the indepen- “I think it’s fair to ac-
At the press conference, Mr. expressed frustration over not the U.S. attorney for the Eastern dence of Ms. Yates. Republicans knowledge that communica-
Kelly also pushed back against knowing the details of the travel District of Virginia, began what on the Senate Judiciary Com- tions—publicly and inter-
reports he was out of the loop ban earlier so that he could pre- is expected to be his short ten- mittee criticized Ms. Yates. agency—haven’t been the best
as the order was being finalized pare his agency to execute it. ure as acting attorney general. At airports across the coun- in the initial rollout of this
at the White House, saying that The agency didn’t issue a fact He succeeded Sally Yates, who try on Tuesday, the chaos that process,” he said.
people from the DHS were “in- sheet about the implementation was fired by Mr. Trump for tell- marked the weekend had dissi- —Jon Kamp, Kristina
volved in the general drafting.” of the order until two days after ing agency attorneys not to de- pated, though fallout was still Peterson and Robert Wall
“This whole approach was it had been signed. It wasn’t un- fend the executive order. The cascading through various contributed to this article.

Donald Trump’s u Cabinet picks: The Senate

First 100 Days
The administration’s latest
actions and agenda at a
glance
TUESDAY
u Court nomination: President
Donald Trump nominated
Judge Neil Gorsuch of the 10th
U.S. Circuit Court of Appeals in
Denver as his choice to fill the
vacant seat on the Supreme
Court, setting off what is ex-
pected to be a brutal, partisan
confirmation fight over a per-
son who could impact U.S. law
for decades.
u Drug prices: The president
told pharmaceutical chief exec-
utives that he wanted them to
bring drug prices “way down,”
but he promised them he
confirmed Elaine Chao to serve
as transportation secretary.
Democrats delayed confirma-
tions of other cabinet picks, in-
cluding the nominees to lead
the Treasury Department and
the Department of Health and
Human Services.
WHAT’S AHEAD
u Senate committees are ex-
pected to vote Wednesday on
the nomination of Sen. Jeff
Sessions as attorney general
and Scott Pruitt as head of the
Environmental Protection
Agency.
u Republicans in Congress are
slated Wednesday to start
moving to rescind a number of
federal regulations that former
President Barack Obama put in
place during his last months in
office. Some of the regulations
JOHN MOORE/GETTY IMAGES

would curb regulations and
lower tax rates to boost their
competitiveness. Mr. Trump
said Medicare and Medicaid are
spending too much money on
drugs.
u Immigration: Homeland Se-
curity Secretary John Kelly said
relate to the coal and oil indus-
tries.
u Mr. Trump plans to travel
Friday to Mar-a-Lago, his es-
tate in Palm Beach, Fla., that
his press secretary described
Tuesday as the “Winter White Illegal immigrants wait to be loaded on to an Immigration and Customs Enforcement plane in October 2015 in Mesa, Ariz.
House.”

Police Split on Immigration Plan

some of the seven countries
subject to a temporary ban on
immigration and travel to the
U.S. may remain on the list lon-
ger than the 90 days man-
dated by last week’s executive
order.
A special
bouquet.
QUOTE
“Judge Gorsuch has out-
standing legal skills, a brilliant
mind, tremendous discipline BY ZUSHA ELINSON Many police chiefs worry sociation. immigrants arrested for immi-
and has earned bipartisan sup- AND SHIBANI MAHTANI that enforcing immigration Mr. Trump’s order, issued gration violations are released
port.” policy will take them from earlier this week, includes cut- back into their communities. A
—Mr. Trump on Tuesday National police groups are their primary mission of pre- ting off funding to “sanctuary separate order calls for hiring
split over President Donald venting and investigating vio- cities” that don’t cooperate more border patrol agents.
Trump’s plan to compel local lent crime, and make immi- with federal immigration en- In Louisiana, St. Charles
law-enforcement agencies to grants less likely to report forcement. And it calls on the Parish Sheriff Greg Cham-
help enforce federal immigra- crimes. federal government to autho- pagne, the president of the Na-
tion law, days after he signed “The key concern is if police rize local law-enforcement to tional Sheriffs Association,
an order to cut off federal become involved with day-to- help enforce immigration law. said sheriffs are “enthused and
funds to cities that shelter ille- day immigration enforcement The order expands the defi- encouraged” by the plan to
gal immigrants. that the people who are here nition of a criminal alien, al- hire more border agents, be-
Police chiefs from the na- illegally will not in fact call the lowing local law enforcement cause “a lot of the burden of il-
tion’s big cities largely oppose police. They’ll be afraid that to jail anyone who has crossed legal immigration has fallen to
the plan. But sheriffs—typi- basically sets them up to be the border illegally, rather the sheriffs,” he said.
cally elected officials responsi- victimized,” said Darrel Ste- than just violent criminals, and He said he supports Mr.
ble for running jail systems— phens, the executive director ends the practice of “catch and Trump’s plans broadly, but was
tend to favor it. of the Major Cities Chiefs As- release,” where undocumented still digesting the details.

Legal Challenges Face an Uphill Battle

BY JOE PALAZZOLO plenary power gives the fed- zon.com Inc., which rely on im- immigration law that allows
AND NICOLE HONG eral government tremendous migrants from the seven Mus- the federal government to take
sway over immigration laws. lim-majority countries. measures that might be uncon-
President Donald Trump’s The challenges to Mr. Trump’s The plenary-power doctrine stitutional otherwise.
immigration and refugee order executive order will likely test first appeared in a Supreme Prof. Spiro said U.S. courts
faces a series of lawsuits seek- the boundaries of plenary Court case in the late 1880s, have been reluctant to under-
ing to challenge the policy’s power, which has evolved over when the justices upheld the mine the government in dis-
Plumeria Hoku Pendant constitutionality and legality. time, legal experts said. Chinese Exclusion Act, a fed- putes over foreign relations
in 14K Yellow, White or Rose Gold Constitutional challenges to Mr. Trump’s executive or- eral law that suspended the and national security, fearing a
from $379 federal immigration policies der, which went into immedi- immigration of Chinese labor- misstep when the stakes are
mostly have foundered over ate effect when it was signed ers. Repealed during World high. The U.S. Supreme Court
Chain included the years, with courts granting last Friday, suspended the U.S. has held that securing U.S.
wide latitude to the executive refugee program for four borders is fundamentally the
and legislative branches. The months and banned for 90 job of the federal government
HAWAII: Oahu, Maui, Kauai, Big Island of Hawaii recent flurry of suits, if unsuc- days entry into the U.S. of peo-
Courts have granted and has never sided against it
BOSTON: Natick Mall, Northshore Mall cessful, could ultimately shore ple from seven countries the federal government in a challenge to immigration
CHICAGO: Woodfield Mall, 600 N. Michigan Avenue up the government’s authority U.S. has designated as posing classifications, Prof. Spiro said.
DALLAS: NorthPark Center • DENVER: Cherry Creek Shopping Center to regulate immigration. an elevated risk of terrorism:
wide latitude on But plenary power has
LAS VEGAS: Grand Canal Shoppes at The Venetian
NEW YORK: Roosevelt Field • ORLANDO: Disney Springs
At least nine lawsuits have Iran, Iraq, Libya, Somalia, Su- immigration policies. ebbed, according to some legal
PHILADELPHIA: The Plaza at King of Prussia been filed challenging the dan, Syria and Yemen. experts. Kerry Abrams, a law
PLEASANTON: Stoneridge Mall • PORTLAND: Washington Square travel and refugee ban since it Late Monday, Washington professor at the University of
SAN DIEGO: Fashion Valley • SAN FRANCISCO: PIER 39 went into effect late last week. became the first state to sue Virginia, said the courts have
SAN JOSE: Valley Fair • SEATTLE: Bellevue Square The lawsuits argue, among the administration over the ex- War II, it was the first major begun to approach it more
WASHINGTON, D.C.: Tysons Corner Center other things, that the order fa- ecutive order, alleging it “has immigration restriction en- skeptically, weighing the civil
vors other religions over Islam both the intent and effect of acted into law and the first ex- liberties of individuals against
in violation of the First discriminating based on na- clusion based on ethnicity. the interests of the govern-
Amendment, and that the or- tional origin and religion,” in Peter J. Spiro, a Temple ment. “That’s a big difference
der’s implementation violates violation of the Constitution. University professor specializ- from the way plenary power
due-process and equal-protec- The lawsuit said the order has ing in constitutional and immi- operated in the 1950s, or even
NaHoku.com • 1-866-296-9374 tion guarantees embedded in harmed the state’s residents gration law, described plenary the 1970s,” Prof. Abrams said.
FREE FEDEX SHIPPING ON ALL ORDERS OF $200 OR MORE the Fifth Amendment. including public universities power as a kind of “parallel —Jacob Gershman
A legal concept known as and large companies like Ama- constitutional universe” for contributed to this article.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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THE WALL STREET JOURNAL. Wednesday, February 1, 2017 | A5

U.S. NEWS

Diplomats en Masse
Dissent Over Order
BY FELICIA SCHWARTZ
WASHINGTON—The State
Department on Tuesday re-
ceived a formal document
signed by many hundreds of
diplomats and officials pro-
testing President Donald
Trump’s refugee and immigra-
tion order, a day after the
tence, White House press sec-
retary Sean Spicer issued a
strong rebuke to the critics,
saying that “career bureau-
crats” should “either get with
the program or they can go.”
The caution didn’t deter the
officials at the State Depart-
ment from submitting a final
version, though it’s unclear

JEWEL SAMAD/AGENCE FRANCE-PRESSE/GETTY IMAGES

White House bluntly said that
officials who disagree with Mr.
Trump’s policies should quit.
People familiar with the
“dissent cable” said the docu-
ment had about 1,000 signa-
tures. The State Department
maintains a special dissent
channel as a formal and confi-
dential vehicle for officials to
express alternative views.
The cable is the largest such
protest ever, said Hannah Gur-
man, a professor at New York
University who wrote a book
what its effect will be. Repri-
sals against those who use the
dissent channel are prohibited
by State Department policies.
The draft cables criticized
Mr. Trump’s move last week to
halt the refugee program for
four months and to suspend all
travel for at least 90 days from
seven Muslim-majority coun-
tries out of concern that ter-
rorists from those countries
might enter the U.S.
“A policy which closes our
doors to over 200 million le- Muslims departing from a mosque in Hamtramck, Mich., in January 2016. The city is home to thousands of Muslim immigrants.

From Some, a Welcome Mat

Roughly 1,000 people
at State Department
attack travel ban, the
biggest protest ever.
about dissent at the State De-
partment. She said the second-
largest, relating to Syria, was
one signed by 51 State Depart-
ment officials last June.
“Historically, the dissent
channel wasn’t a group kind of
thing, it’s only more recent
that this is happening,” she
said. There are approximately
25,000 career diplomats and
civil servants at the State De-
partment.
Drafts of the cable have
been circulating around the
State Department and embas-
sies overseas in the past few
days. Officials said they had
originated in the State Depart-
ment’s Consular Affairs bu-
reau, which oversees interna-
tional U.S. traveler services
and immigration.
On Monday, in response to
the reports of the draft’s exis-
gitimate travelers in the hopes
of preventing a small number
of travelers who intend to
harm Americans from using
the visa system to enter the
United States will not achieve
its aim of making our country
safer,” said a draft reviewed by
The Wall Street Journal. A fi-
nal version of the cable wasn’t
immediately available.
The dissent goes to the sec-
retary of state and other se-
nior officials, though many top
Trump administration officials
aren’t yet in place. Tom Shan-
non, formerly the under secre-
tary of state for political af-
fairs during the Obama
administration, has served as
acting secretary of state. The
Senate may hold a confirma-
tion vote as soon as Wednes-
day for Mr. Trump’s nominee
to lead the State Department,
Rex Tillerson.
The protest comes after the
Trump administration last
week removed several top
State Department officials. On
Monday evening, Mr. Trump
fired Acting Attorney General
Sally Yates after she ordered
the Justice Department not to
defend the refugee order,
questioning its legality.
BY WILL CONNORS
An array of Republican and
Democratic officials from the
Rust Belt and Midwest have
expressed concern about Presi-
dent Donald Trump’s clamp-
down on refugees and immi-
grants for one overriding
reason: Their communities
need more people.
D e m o c ra t i c - c o n t ro l l e d
“sanctuary cities,” including
Chicago, San Francisco and
New York, have been outspo-
ken in resisting the adminis-
tration’s ban on refugees and
limits on immigrants from
seven Muslim-majority coun-
tries, citing political and moral
reasons.
But officials from a second
tier of smaller cities are high-
lighting the economic impor-
tance of refugees and immi-
grants to bolster declining
populations and add man-
power, skills and entrepre-
neurial know-how.
“I understand that the pres-
ident is trying to protect the
U.S.,” said Janet Doll, a Repub-
lican city commissioner in Gar-
den City, Kan. However, she
said, “The immigrants we have
here are productive members
of society. They have nice jobs
and want to contribute to the
quality of life in our commu-
nity.”
Many cities and states in
the Rust Belt have worked to
attract foreign-born residents
and help integrate them into
local economies. Michigan,
whose state government is
controlled by Republicans, ac-
cepted more Syrian refugees
last year than any state except
California.
Troy, Mich., took in the
most Syrian refugees in the
state last year. Martin Howry-
lak, a Republican state repre-
sentative in Troy, worries that
the president’s ban will harm
what he describes as a thriving
community, where 30% of the
population is foreign-born.
“We’re trying to put our
residents at ease,” Mr. Howry-
lak said. “The morale is getting
very low, and the fear is get-
ting high, and that’s very det-
rimental to our economy. You
can’t have this and have a
prosperous economy.”
Some officials in the Rust
Belt, however, support the
president’s ban.
“When [refugees] come in,
you don’t know who’s coming
across,“ said Brooks Patter-
son, the Republican county ex-
ecutive in Oakland County,
Mich., which encompasses sev-
eral wealthy Detroit suburbs.
“Some of them are legitimate
refugees, others are embedded
terrorists,” he said, without
giving evidence.
A 2015 study commissioned
by the city of Columbus,
Ohio, found there were 873
refugee-owned businesses in
the metro area that employed
3,960 workers, and that those
businesses contributed $605.7
million a year to the local
economy.
Andrew Ginther, the
city’s Democratic mayor.
said Columbus has its lowest
unemployment rate in 25
years, and new Americans had
“a great role to play” in that.
In Detroit, the nonprofit
Global Detroit runs a number
of immigrant-directed pro-
grams, including job training.
“We’re not an immigrant-
rights group, we’re a group
that cares about the economy
and wants to create more jobs
and develop the region,” said
Steve Tobocman, the group’s
head.
Refugees helped start or ex-
pand 600 small businesses in
St. Louis since 1999, said Anna
Crosslin, co-founder of the
economic-development group
St. Louis Mosaic Project, es-
tablished in 2012 to help boost
immigrant growth in the city.
“Banning refugees from
Muslim countries makes no
sense from a humanitarian, an
economic-development or for-
eign-policy sense,” she said.

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A6 | Wednesday, February 1, 2017
Nominee for
Scalia’s Spot
Fits His Mold
BY BRENT KENDALL
WASHINGTON—In naming
Judge Neil Gorsuch to the Su-
preme Court, President Donald
Trump has chosen an admirer
of Antonin Scalia, albeit one
with a gentler tone.
Judge Gorsuch, 49 years
old, a demonstrated conserva-
tive with a Washington pedi-
gree, has served on the Den-
ver-based 10th U.S. Circuit
Court of Appeals since 2006,
when he was nominated by
President George W. Bush and
confirmed easily by the Senate
on a voice vote.
Judge Gorsuch has tended
to favor a limited role for the
courts, saying judges shouldn’t
intrude in policy-making areas
appropriately left to the legis-
lature and the president. “Of-
ten judges judge best when
they judge least,” he wrote in
an opinion last year.
He has publicly praised the
career of Justice Scalia, the
conservative favorite he has
been tapped to replace, citing
Announcement Presented With TV Flair
BY DAMIAN PALETTA
AND MICHAEL C. BENDER
President Donald Trump
employed a bit of drama be-
fitting a former television
host to set the stage for a po-
litical battle that will consume
his administration for months
ahead: the appointment of a
U.S. Supreme Court justice.
Before Mr. Trump’s grand
reveal of his selection on
Tuesday, the day’s count-
down featured unheard of
reality television moments.
Most notably, one of the can-
didates, Thomas Hardiman,
Trump’s Supreme Court Nominee Likely to Restore Conservative Majority
The history of the high court by political party of appointing president, gender, race, religion and law school
Justices by political party of appointing president
Federalist Republican
10 justices The Supreme Court was
established with six
seats in 1789.
9
Congress added seats as
the country expanded,
reaching nine in 1837.
8
7
6
5
4
3
2
1
1790 1800 ’10 ’20
Note: Only one justice appears per seat in any given year. In transition years where one justice replaced another, the justice who served in that seat for the greater portion of the year is shown.
Source: U.S. Supreme Court Justices Database, compiled by a team led by law professor Lee Epstein at Washington University
COURT
Continued from Page One
taken an ideological approach
that he said raised questions
about his independence.
But it will likely take days
before the intensity of the
Democratic opposition be-
comes apparent.
The event was something of
a spectacle, with Mr. Trump
keeping the two finalists for
the nomination, Judge Gor-
such and Judge Thomas Hardi-
man, in suspense. As Mr.
Trump’s team sought to build
anticipation for the announce-
ment, some Republican sena-
tors weren’t informed about
the pick until about two hours
before it took place in the East
Room. Don McGahn, the White
House counsel, had been in
touch with Judiciary Republi-
cans soliciting their input.
That helped build their com-
fort with the selection process,
Sen. Jeff Flake (R., Ariz.) said.
Judge Gorsuch, 49 years
old, is a well-established con-
the late justice’s “originalist”
approach to interpreting the
law, which focuses on what a
legal provision ostensibly
meant at the time it was ad-
opted.
There are other similarities
between the two—and differ-
ences as well. Judge Gorsuch,
like Justice Scalia, is consid-
ered a talented writer, and he
hasn’t been afraid to draft con-
curring or dissenting opinions
that raise the profile of diffi-
cult legal issues. But while
Justice Scalia could offer bit-
ing and sometimes caustic cri-
tiques of lawyers appearing
before him or for colleagues
with whom he disagreed,
Judge Gorsuch’s opinions re-
veal a milder manner.
The 10th Circuit isn’t among
the nation’s most prominent
appeals courts, but Judge Gor-
such has confronted some
high-profile issues. Among
them, he favored the right of
religious business owners and
nonprofits to claim exemptions
from a requirement of the Af-
was caught by cameras
pumping gas in Pennsylva-
nia, and it was mistakenly
reported that he was on his
way to Washington.
But perhaps the greatest
break from tradition Tuesday
was the fact that the name
of the nominee had never
leaked to the news media,
giving the president a rare
chance to deliver real news
in real time.
The seating in the East
Room, with its golden cur-
tains, crystal chandeliers and
portrait of President Teddy
Roosevelt, had reserved
Democrat Whig
’30 ’40 ’50 ’60
servative, appointed by Presi-
dent George W. Bush to the
Denver-based 10th U.S. Circuit
Court of Appeals. He has been
outspoken about the need for
courts to have a limited role in
American life, and he has criti-
cized what he considers the
disproportionate powers taken
on by federal agencies.
“When we judges don our
robes, it doesn’t make us any
smarter, but it does serve as a
reminder of what’s expected
us: Impartiality and indepen-
dence, collegiality and cour-
age,” he said, standing in front
of his wife, Louise, and Mr.
Trump.
The judge is also known as
an articulate writer who rel-
ishes jumping into complex or
difficult legal subjects. Among
his notable cases, he favored
the right of religious business
owners to claim exemptions
from a provision of the Afford-
able Care Act that requires
them to provide contraception
coverage to their employees.
His mother, Anne Gorsuch
Burford, served in the adminis-
tration of President Ronald
U.S. NEWS
Judge Neil Gorsuch at the White House on Tuesday night after President Donald Trump nominated him for the Supreme Court.
fordable Care Act that employ-
ers provide contraception cov-
erage to their workers.
Judge Gorsuch also has
voiced broad suspicions of the
might of the administrative
state, saying government agen-
cies have exercised powers
that properly belong to law-
makers and the courts.
The judge is a Colorado na-
tive but has a lengthy history in
the nation’s capital, dating to
the days when his mother,
Anne Gorsuch Burford, served
as administrator of the Envi-
spots for about two dozen
members of Congress. Not a
single Democrat showed.
Senate Minority Whip
Dick Durbin (D., Ill.) said ear-
lier in the day that he de-
clined the White House invi-
tation because he didn’t
want his appearance there to
look like a signal of support
on camera, when he would
be going unaware of who the
nominee was.
“At some point tonight,
they are going to pull back
the curtain and there stands
the nominee,” he said. “I don’t
want to be a prop at this. I
The court reached 10 seats in 1863
before Congress reduced it to seven
and then settled on nine in 1869.
’70 ’80 ’90 1900 ’10
Reagan as head of the Environ-
mental Protection Agency.
Judge Gorsuch has a glitter-
ing legal pedigree, having
served as a law clerk for for-
mer Supreme Court Justice By-
ron White and current Justice
Anthony Kennedy. If he is con-
firmed, he would be the first
justice to serve with a justice
for whom he clerked.
Sen. Mike Lee (R., Utah), a
former assistant U.S. attorney,
said he had argued before
Judge Gorsuch and found him
“extremely impressive,” saying
he would work hard for the
judge’s confirmation.
But while he sailed through
his previous confirmation,
Judge Gorsuch is likely to face
a brutal landscape this time
around. Democrats have yet to
confirm 16 of Mr. Trump’s cab-
inet appointees, citing, in
some cases, ethics concerns,
as well as the uproar from
their voters over Friday’s
White House executive order
to suspend entry from seven
Muslim-majority nations out
of concerns that terrorists
from those countries may en-
ronmental Protection Agency
under President Ronald Reagan.
Judge Gorsuch, who holds
degrees from Columbia, Har-
vard and Oxford, served as a
Supreme Court law clerk for
Justices Byron White and An-
thony Kennedy. If confirmed,
he would become the first ap-
pointee to serve with a justice
for whom he previously
clerked.
The judge joined the 10th
Circuit after two years in the
Bush Justice Department and a
decade in private practice at a
want to take this seriously.”
Sen. Ben Sasse (R., Neb.)
said on Tuesday that he had a
hunch of who the Supreme
Court pick would be, but he
wasn’t certain given Mr.
Trump’s flair for the dramatic.
“With this president, there
was a decent chance that it
would be somebody who we
didn’t have any idea who it
was going to be,” he said.
“And tonight’s ‘Apprentice’-
style delivery moment might
have had an evening gown
competition and a swimsuit
edition. So I didn’t know what
was really going to happen.”
The seat previously held by the late Justice Antonin Scalia has sat
vacant for almost a year. Senate Republicans refused to consider
Barack Obama’s nominee, leaving the spot open for Mr. Trump to fill.
’20 ’30 ’40 ’50 ’60
ter the U.S.
Some Democrats have sug-
gested retaliation for Republi-
cans' move last year to deny
President Barack Obama a
chance to fill Justice Antonin
Scalia’s seat after his death in
February. Mr. Obama nominated
Merrick Garland, the chief jus-
tice of the U.S. Court of Appeals
for the District of Columbia, but
Senate Majority Leader Mitch
The divided high
court has moved at a
slow pace since
Justice Scalia died.
McConnell had declared within
hours of Justice Scalia’s death
that Republicans wouldn’t con-
sider any nomination by the
Democratic president.
Sen. Patrick Leahy of Ver-
mont, a senior Democrat on
the Senate Judiciary Commit-
tee, signaled that Judge Gor-
such wouldn’t face a smooth
* ***** THE WALL STREET JOURNAL.
Washington law firm.
Judge Gorsuch, who has a
wife and two daughters, has
been an active writer, includ-
ing of a book and several arti-
cles that oppose the legaliza-
tion of assisted suicide and
euthanasia.
In a 2005 National Review
essay, he expressed concern
about the politicization of the
courts, criticizing American
liberals as too reliant on
judges instead of elected lead-
ers for the advancement of
their policy goals. “This over-
President Barack Obama
nominated U.S. Circuit Judge
Merrick Garland, a centrist
who once had Republican
support, to fill the vacancy
in March. Senate Majority
Leader Mitch McConnell, a
Kentucky Republican, re-
fused to move Judge Gar-
land’s nomination, citing the
closeness of a presidential
election. Judge Gorsuch’s
nomination will likely set off
a battle with Democrats, but
it is unclear how intense
their opposition will be.
Before the announcement
on Tuesday, two federal ap-
’70 ’80 ’90 2000 ’10
Joel Eastwood and Stephanie Stamm/THE WALL STREET JOURNAL.
path, saying Mr. Trump’s “un-
constitutional actions” in his
first week required “unspar-
ing” scrutiny of the nomina-
tion. At least three Democratic
senators quickly said they op-
posed the nomination—Eliza-
beth Warren of Massachusetts,
Sherrod Brown of Ohio and
Jeff Merkley of Oregon.
By contrast, Sen. Joe Man-
chin of West Virginia, a cen-
trist Democrat, said his col-
leagues should “put partisan
politics aside and allow the
vetting process to proceed.”
Republicans hold a 52-48
advantage in the Senate, mean-
ing they must attract eight
Democratic votes to overcome
a potential filibuster.
Judge Gorsuch would join
a court that has moved at a
slow speed since the death of
Justice Scalia, a man Judge
Gorsuch described Tuesday
evening as a “lion of the law.”
The high court deadlocked
on some notable cases last
term, including on immigra-
tion and union dues, and
reached narrow rulings in
others.
BRENDAN SMIALOWSKI/AGENCE FRANCE-PRESSE/GETTY IMAGES
weening addiction to the
courtroom as the place to de-
bate social policy is bad for
the country and bad for the ju-
diciary,” he wrote.
Presidents have tended to
look for Supreme Court nomi-
nees who were young enough
to serve as justices for de-
cades, and Judge Gorsuch fits
that bill. He would be the
youngest member of the cur-
rent court, seven years the ju-
nior of 56-year-old Elena Ka-
gan, who joined the court six
years ago.
peals judges emerged as Mr.
Trump’s finalists: Neil Gor-
such of the 10th U.S. Circuit
Court of Appeals in Denver
and Judge Hardiman of the
Third Circuit in Philadelphia.
Minutes after Mr. Trump
took to the podium alone,
skipping the traditional joint
entrance, he announced that
Judge Gorsuch would be the
nominee. “Here they come,”
Mr. Trump said as the judge
and his wife Louise emerged
from behind to join him.
—Jess Bravin
and Brent Kendall
contributed to this article.
Neil Gorsuch
(if confirmed)
Samuel A.
Alito, Jr.
John G.
Roberts
Clarence
Thomas
Anthony M.
Kennedy
Ruth Bader
Ginsburg
Stephen G.
Breyer
Sonia
Sotomayor
Elena
Kagan
2017
Big cases are looming, in-
cluding a case about a Virginia
transgender student who said
his school discriminated
against him by prohibiting him
from using the bathroom of his
choice. In the potential case
pipeline are major election-law
disputes as well as litigation
over the constitutionality of
the Consumer Financial Protec-
tion Bureau.
With the early batch of exec-
utive orders by Mr. Trump, it
also is possible that litigation
over those matters could soon
arrive at the high court.
Mr. Trump met with Repub-
lican and Democratic leaders
about his choices, and he con-
ferred with outside figures, in-
cluding Mr. Santorum and con-
servative commentators such
as Laura Ingraham and Andrew
Napolitano, a person familiar
with the process said. He has
sought advice from his sister,
Judge Maryanne Trump Barry
of the Third U.S. Circuit Court
of Appeals in Philadelphia, Mr.
Santorum said.
—Byron Tau
contributed to this article.
 For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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THE WALL STREET JOURNAL. * * * * * NY Wednesday, February 1, 2017 | A7

U.S. NEWS FROM PAGE ONE

Gorsuch Record Has

A Pro-Business Tilt

CJ GUNTHER/EUROPEAN PRESSPHOTO AGENCY

BY SARA RANDAZZO
During his decade on the
bench, U.S. Circuit Court Judge
Neil Gorsuch has penned sev-
eral opinions that favor busi-
nesses in disputes about arbi-
tration clauses, labor and
employment issues, and class-
action venues.
But partly because his Den-
ver-based appellate court
doesn’t receive the steady flow
of big business cases that
courts in New York and else-
where do, his record on such
cases is somewhat spotty. So it
is hard to predict whether
Judge Gorsuch, if confirmed to
the U.S. Supreme Court, would
help tip more decisions in fa-
vor of companies.
In one of his most notewor-
thy cases, Hobby Lobby Stores
Inc. v. Sebelius, Judge Gorsuch
wrote a concurring opinion
recognizing that companies
can have religious rights.
In his opinion, Judge Gor-
such explained why Hobby
Lobby and the company’s own-
ers are protected by the Reli-
gious Freedom Restoration
Act, a 1993 law expanding the
right of Americans to practice
their religion free of govern-
ment interference.
Wrote Judge Gorsuch: “No
doubt, the Greens’ religious
convictions are contestable.
Some may even find the
Greens’ beliefs offensive. But
no one disputes that they are
sincerely held religious beliefs.
This isn’t the case, say, of a
wily businessman seeking to
use an insincere claim of faith
as cover to avoid a financially
burdensome regulation.”
In December, Judge Gorsuch
made it easier for defendant
companies to transfer class ac-
tions from state to federal
court in some instances, a
move that companies often
value because federal court is
often more predictable.
In the underlying case, a
consumer sued Stamps.com in
New Mexico state court over
allegedly misleading monthly
subscription fees. A judge re-
buffed the company’s attempt
to move the proposed class ac-
tion to federal court, finding
that it couldn’t prove that at
least $5 million was in contro-
versy, as required by the fed-
eral Class Action Fairness Act.
Writing for a three-judge
panel, Judge Gorsuch reversed
the decision, saying the lower
court applied too stringent a
standard and that finding fed-
eral jurisdiction under the act
“doesn’t depend on how much
the plaintiff is likely to recover
but on the amount the plain-
tiff’s allegations suggest she
might lawfully recover.”
On labor and employment,
Judge Gorsuch’s record is
Opinions cover
arbitration clauses,
labor issues and
class-action venues.
mixed, with some rulings in fa-
vor of employees and others
siding with employers.
In an appeal of a National
Labor Relations Board order,
Judge Gorsuch disagreed in
2016 with his colleagues on
the legality of an NLRB rule
governing how back pay is cal-
culated when an employer un-
lawfully reduces a unionized
employee’s hours.
The two other judges on the
panel sided with the NLRB,
which decided that a hospital
shouldn’t take a worker’s in-
terim earnings—money earned
from a second job to cover the
loss of hours at the first job—
into consideration when deter-
mining how much back pay the
worker is owed. Judge Gorsuch
disagreed, citing a history of
taking interim earnings into
account when calculating back
pay and arguing that carving
out cases where employees
have hours cut but aren’t ter-
minated is inconsistent.
In a swipe at the NLRB, he
wrote, “In the end, it’s difficult
to come away from this case
without wondering if the
Board’s actions stem from a
frustration with the current
statutory limits on its remedial
powers.”
In private practice, Judge
Gorsuch penned an article with
a colleague railing against
what they saw as abuses by
plaintiffs’ lawyers who sue
firms over alleged violations of
securities laws, accusing them
of bringing frivolous claims in
hopes of cashing in on quick
settlements. “Today, economic
incentives unique to securities
litigation encourage class-ac-
tion lawyers to bring meritless
claims and prompt corporate
defendants to pay dearly to
settle such claims,” the article,
published in the Andrews Se-
curities Litigation & Regula-
tion Reporter, said.
In the push-and-pull be-
tween businesses and consum-
ers over arbitration clauses,
which force disputes into a
private venue rather than pub-
lic court, Judge Gorsuch has
taken the view that deciding
whether to send a case to arbi-
tration should happen swiftly.
In a 2014 opinion, the judge
chided a Kansas district court
for ruling that a case shouldn’t
go to arbitration following a
year-and-a-half of discovery
that failed to resolve whether
the parties in the lawsuit had
ever agreed to arbitration.
Judge Gorsuch sent the case
back to the lower court. Under
the federal law that governs
arbitration, he wrote, “The ob-
ject is always to decide
q u i c k l y— s u m m a r i l y— t h e
proper venue for the case,
whether it be the courtroom
or the conference room, so the
parties can get on with the
merits of their dispute.”
A New England Patriots fan at Jan. 22’s AFC championship game.
NFL
Continued from Page One
tect its lucrative franchise was
quietly on view in late Decem-
ber, when it tinkered with its
Christmas weekend broadcasts.
Hoping to speed the flow of its
long games, some broadcasts
had four longer commercial
breaks each quarter instead of
five shorter ones, for example.
The NFL Network showed a
“double-box,” running a com-
mercial while continuing to
show footage from the sta-
dium to try to keep people en-
gaged. Around the same time,
the league’s NFL Films unit re-
produced games with different
break patterns, which were
then shown to focus groups.
“Our goal is to make some
changes to make the game bet-
ter,” said Brian Rolapp, executive
vice president for NFL Media.
The move to shake things
up comes after a season in
which average viewership per
game fell 8% overall and some
teams played before ugly
patches of empty seats in sta-
diums as sold tickets went un-
used. The league has faced a
rumble of discontent from
fans, the media and former
players about diminished star
power on the field, the health
ramifications of a violent
sport and a dull postseason.
“We all know that the way
we consume media and the
things we are conditioned to
are changing,” Mr. Rolapp
said. He added that league of-
ficials have a “healthy para-
noia” about maintaining the
league’s position as the coun-
try’s most popular sport and
television product.
Besides rearranging com-
mercial lineups, people in-
volved with the planning said,
the league may simplify its
Thursday night lineup and
make start times for games in
London later.
The moves are a rare admis-
sion from the NFL that the di-
minished audiences this season
may not simply have been the
result of a riveting presidential
election that consumed view-
ers’ attention. League officials
say they have to work harder
to present a better product as
the competition for fans’ time
and entertainment dollars
grows more fierce each year.
The problems signal that
the NFL is suddenly facing the
same challenges that have buf-
feted other U.S. sports leagues.
That includes a sudden pro-
pensity of franchises to relo-
cate. The Rams moved from St.
Louis to Los Angeles last year.
The San Diego Chargers said in
January they will move to Los
Angeles beginning next season.
The Oakland Raiders intend to
move to Las Vegas, with a
promise of $750 million in
public stadium funding, despite
the loss of support from casino
magnate Sheldon Adelson.
The relocation plans come
after the Chargers and Raiders
failed to secure public funding
for new stadiums they said they
needed to compete successfully,
suggesting an NFL team could
only succeed in those markets
with a major public subsidy.
NFL spokesman Joe Lock-
hart said that may be true in
certain midsize markets, but
New York and San Francisco
have proven teams can be suc-
cessful without public money.
Ticket sales rose slightly in
2016, helped in part by the
Rams move to the cavernous
Los Angeles Coliseum, and the
league sold 97% of seats.
But in numerous stadiums,
a no-show trend saw thou-
sands of empty seats. Mr.
Lockhart, said the no-show
numbers were essentially in
line with last season.
Two years ago, NFL games
accounted for 29 of the most
watched 30 programs on televi-
sion during the fall season. Also,
more than 20 stadiums were ei-
ther built or underwent major
renovations during the past two
decades, which drove ticket and
luxury-suite sales to record lev-
els. Revenue approached $14 bil-
lion this season. The salary cap
will rise by $10 million per team
for 2017, giving teams still more
money to spend on players.
Ratings plummeted for the
first half of the season, how-
ever, then rebounded some-
what over the final two
months. But average viewer-
ship per game continued to fall
3.5% in the final weeks of the
season and 8% overall.

Quotables on the Nominee

‘Judge Gorsuch has repeatedly ‘Neil Gorsuch is a highly-

sided with corporations over
working people, demonstrated
a hostility toward women’s
rights, and most troubling,
hewed to an ideological
approach to jurisprudence
that makes me skeptical that
he can be a strong,
independent justice on the
court.’
SEN. CHARLES SCHUMER, MINORITY
LEADER, NEW YORK DEMOCRAT
regarded jurist with a record of
distinguished service, rooted in
respect for the law. He was
confirmed unanimously by
Democrats and Republicans.
Sen. Schumer is about to tell
Americans that Judge Gorsuch
kicks puppies and heckles
piano recitals. That’s
hogwash.’
SEN. BEN SASSE,
NEBRASKA REPUBLICAN

‘Senators have a constitutional obligation to advise and consent

on a nominee to fill this Supreme Court vacancy and, simply
put, we have a responsibility to do our jobs as elected officials.’
SEN. JOE MANCHIN, WEST VIRGINIA DEMOCRAT
ZACH GIBSON/ASSOCIATED PRESS (LEFT); ALEX BRANDON/ASSOCIATED PRESS

‘The question is whether his views are so conservative to put

him outside the judicial mainstream.’

ERWIN CHEMERINSKY, DEAN, UNIVERSITY OF CALIFORNIA, IRVINE SCHOOL OF LAW

‘He’s extremely smart, knows federal law and procedure inside

and out, writes elegantly and with nuance, is at the top of his
game analytically.’
LAURENCE TRIBE, PROFESSOR, HARVARD LAW SCHOOL
 For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
A8 | Wednesday, February 1, 2017
Inflation Perks Up in Sign of a New Era
Higher energy prices,
falling unemployment,
low rates help turn tide
in U.S., eurozone, Japan
After years of fighting
against deflation, the U.S., the
eurozone and Japan show
glimmers of life in consumer
prices and wages, evidence
that an era of exceptionally
low inflation is receding from
the global economic land-
scape.
By Mike Bird,
Christopher Whittall
and Ben Leubsdorf
Several factors are behind
the move, including a rebound
in energy prices, falling unem-
ployment and central banks’
low-interest-rate policies,
which spur lending and eco-
nomic growth.
In the eurozone, consumer
prices rose 1.8% in January
from a year earlier, a product
of the energy rebound that
made for the sharpest increase
in nearly four years, up from
1.1% in the year to December
2016, the European Union’s
statistics agency said Tuesday.
Market-based measures of
Eurozone Growth Rivals U.S. as Unemployment Falls
Playing Catch-Up
Annual change in inflation-
adjusted GDP since the inception
of the euro
6%
U.S. Eurozone
4 ting the currency area on a
2 a year clouded by political un-
0 A fourth-quarter pickup al-
–2
–4
–6
’99 ’00 ’10 ’16
Sources: Eurostat (eurozone); Commerce
Department (U.S.)
THE WALL STREET JOURNAL.
TSERING TOPGYAL/ASSOCIATED PRESS
Indian homeless people waited for the distribution of free food from a charity in the old quarters of New Delhi on Tuesday.
India Floats Idea for Basic Income
BY RAYMOND ZHONG
NEW DELHI—India is look-
ing at a radical idea for reduc-
ing poverty: free money for ev-
eryone—no strings attached.
The Ministry of Finance’s an-
nual survey of the economy, re-
leased Tuesday, explores how
the country might replace its
various welfare programs with
a universal basic income, or a
uniform stipend paid to every
adult and child, poor or rich.
Guaranteeing all citizens
enough income to cover their
basic needs would promote so-
cial justice, the survey says, and
empower the poor to make
their own economic choices. It
would also be easier to admin-
ister than India’s current anti-
poverty programs, which are
plagued by waste, corruption
and abuse.
Arvind Subramanian, the
ministry’s chief economic ad-
viser and lead author of the
survey, said concerns about
how a universal income would
be enacted—and how the gov-
ernment would pay—mean that
India is far from putting the
concept into practice.
“It’s an idea whose time is
ripe for further deliberation
and discussion, and not neces-
sarily for immediate implemen-
tation,” Mr. Subramanian told
reporters.
inflation have also increased.
In Germany, expected inflation
over 10 years as measured in
bond markets has risen from
1.10% in early November to
1.36% on Tuesday, according to
Thomson Reuters. In Japan, it
has ticked up from 0.45% to
0.61% in the period.
“We still believe in the
global reflation trade. It can
happen in Japan, it can happen
in Europe,” said Ryan Myer-
berg, a senior portfolio man-
ager at Janus Capital Group.
Modest upward pressure on
wages and prices in the U.S.
has been leading the way. A
broad gauge of U.S. wage and
benefit costs, the employment-
cost index, rose 2.2% during
2016, the Labor Department
said Tuesday. The pace of com-
pensation growth has stepped
up modestly from its average
annual growth of 2% in 2010
through 2014.
A separate U.S. measure, av-
erage hourly earnings for pri-
vate-sector workers, rose 2.9%
in December from a year ear-
lier. That was the strongest
growth of the current expan-
sion, signaling employers are
raising pay to compete over a
shrinking pool of available
workers.
Many factors could reverse
BY PAUL HANNON
AND WILLIAM HOROBIN
The eurozone economy
kept pace with that of the U.S.
for the first time since 2008
last year and its jobless rate
fell to a seven-year low, put-
steadier footing at the start of
certainty.
lowed the eurozone economy
to expand by 1.7% compared
with 1.6% for the U.S. in calen-
dar 2016, demonstrating the
currency zone’s resilience in
the face of repeated shocks,
including the U.K.’s June vote
to depart the European Union
and terrorist attacks in
France, Belgium and Germany.
Universal basic income is an
old idea that is enjoying a re-
vival as governments look to
overhaul their safety nets. Fin-
land launched a pilot project
this year, and localities in Can-
ada and the Netherlands have
also announced experiments.
Voters in Switzerland consid-
ered, and rejected, a minimum-
income proposal last year.
In India, the idea is espe-
cially appealing because of the
weakness of existing welfare
A survey considers the
notion of replacing
welfare programs with
a uniform stipend.
programs, which largely take
the form of subsidies paid to
sellers of grain, fuel, fertilizer
and other essentials. By making
everyone eligible, a universal
basic income obviates the
messy task of identifying who is
and who isn’t in need of assis-
tance. And by paying money di-
rectly into bank accounts, it
would allow India to do away
with the vast administrative
machinery currently needed to
supply the poor with cheap
wheat, rice and other goods.
WORLD NEWS
The Bank of Japan kept its monetary policy unchanged on Tuesday. Above, shoppers in Kitakyushu.
the trend, including an eco-
nomic shock that damps global
growth or a downturn in en-
ergy prices. Few economists
see inflation taking off from
low levels. Still, worries about
global deflation are starting to
take a back seat on the list of
economists’ concerns.
“There are inflationary
mechanisms rather than disin-
To be sure, the eurozone’s
gross domestic product grew
more slowly last year than
2015’s 2%. U.S. growth fell off
even more sharply, however,
and the two economies’ rates
remain close: Measuring
fourth-quarter growth against
the fourth quarter of 2015, the
eurozone was up 1.8% com-
pared with 1.9% for the U.S.
Although a breakdown of
the factors driving growth in
the final three months of last
year isn’t yet available for the
eurozone as a whole, national
figures point to a revival of in-
vestment spending.
“Growth was well above
previous years,” said Alain Ro-
saz, president of Ficime, a
federation of 417 French com-
panies importing and distrib-
By one estimate, around one-
third of the grain set aside for
India’s food-welfare program
never reached the intended
beneficiaries in 2012, the most
recent year for which compre-
hensive data are available. Pay-
ments under a giant rural-work
program are regularly delayed,
leaving families in the lurch.
Prime Minister Narendra
Modi’s government has tried to
repair the system, largely by
moving toward reimbursing
poor people on their purchases
of basic goods with money paid
directly into their bank ac-
counts. Universal basic income
would be an extension of that
approach and could encourage
more people to use formal fi-
nancial services.
In the short term, though,
India’s underdeveloped finan-
cial infrastructure would make
it hard for many people to ac-
cess entitlements. According to
the World Bank, there are only
around 20 ATMs for every
100,000 adults in India, com-
pared with 70 in South Africa,
114 in Brazil and 132 in the U.K.
Although the government says
it has helped open 260 million
bank accounts since 2014, one-
third of Indian adults remain
unbanked.
When it comes to estimating
the cost of a basic income, the
survey first looks for a level of
flationary mechanisms or de-
flationary mechanisms in place
now,” said Ian Shepherdson,
chief economist at research
firm Pantheon Macroeconom-
ics. He pointed to stabilized
global energy prices, rising
prices for factory goods com-
ing out of China, and a low
U.S. unemployment rate set to
drive an acceleration in wage
Joblessness reached a
seven-year low as
higher prices help
allay deflation fears.
uting machinery. “It’s a clear
sign businesses are respond-
ing to the recovery after not
investing for a long time.”
A stronger eurozone would
be a support to a global econ-
omy still experiencing an un-
derpowered recovery from
the financial crisis. But the
eurozone faces headwinds in
2017. A rising inflation rate is
a mixed blessing, since higher
energy prices could curb
stipend that would bring every-
one but India’s very poorest
above the poverty line of 893
rupees ($13) a month. That
amount works out to 7,620 ru-
pees ($112) a person each year.
If the stipend is paid out to
only 75% of the population,
making it not quite universal,
the total cost to the govern-
ment comes to 4.9% of India’s
gross domestic product. The
program’s cost would become
“prohibitively high,” according
to the survey, if the payment
amount were further increased
to try to lift all Indians above
the poverty line.
Simply getting rid of present
welfare measures wouldn’t free
up enough money even for the
more-realistic income program,
the survey shows. Ending the
major subsidies for the poor—
on food, fertilizer and fuel—
would save 2.07% of GDP. Elimi-
nating additional subsidies that
accrue to the middle class—on
things like train and air travel,
cooking gas and loans—would
provide an additional 1.05% of
GDP.
A basic income, the survey
argues, gives “concrete expres-
sion to the idea that we have a
right to a minimum income,
merely by virtue of being citi-
zens. It is the acknowledgment
of the economy as a common
project.”
* *** THE WALL STREET JOURNAL.
of consumer-price inflation
was up 1.6% in December from
a year earlier, the largest in-
crease since September 2014,
also thanks to energy prices
rebounding.
In Europe and Japan, the
chances of a sustained up-
swing in inflation hinges on
the next steps taken by the Eu-
ropean Central Bank and the
Bank of Japan. Unlike the Fed,
both the ECB and the Bank of
Japan are still engaged in large
bond-buying programs meant
TOMOHIRO OHSUMI/BLOOMBERG NEWS
to further stimulate growth,
and benchmark interest rates
are negative.
Though inflation is now
practically at the ECB’s target
rate of around 2%, the central
bank has shown no sign of par-
ing its stimulus.
On Tuesday, the Bank of
Japan kept its monetary policy
unchanged and didn’t raise its
inflation forecast, underlining
growth. the challenge of boosting con-
Federal Reserve officials, sumer prices in a country that
meeting Tuesday and Wednes- has battled deflation for years.
day, are expected to keep U.S. Some investors see cause
short-term interest rates for hope. Rising commodity
steady. They have been raising prices should give headline in-
interest rates gradually and flation a shot in the arm, while
are reluctant to move too ag- a weaker yen could play a cru-
gressively for fear of short- cial role by increasing the cost
circuiting the U.S. expansion. of imports while spurring ex-
The Fed’s preferred measure ports and growth.
household spending on other out of the EU, while conserva-
goods and services unless tive candidate François Fillon
workers can secure wage says he would implement a
rises. Higher wages have be- deep austerity program cou-
come slightly more likely with pled with tax cuts for business
a sharper fall in unemploy- and tax increases for consum-
ment at the end of last year. ers. Pro-business centrist Em-
Economists also worry that manuel Macron has indicated
growth could be damped by he would loosen labor laws to
high levels of uncertainty tackle unemployment.
ahead of a key elections that At French food supplement
could register gains for parties company Laboratoire Carrare,
hostile to the euro and the EU. Chief Executive Alban Maggiar
In France, the leading presi- renewed computer equipment
dential candidates are propos- at his small Paris office at the
ing significant departures end of the year after a period
from the current economic of sustained sales growth.
policy of President François “When you have a small
Hollande ahead of voting in business, you are resolutely
April and May. optimistic,” said Mr. Maggiar.
National Front leader Ma- “But, and it’s a big but, French
rine Le Pen has centered her election years are never very
campaign on pulling France good for consumption.”
U.N. Orders Turkey
To Release Judge
BY MARGARET COKER hasn’t participated in the U.N.
court hearings that led to the
ISTANBUL—A United Na- ruling.
tions court ordered Turkey to Previously, officials familiar
release an international war- with the case have said they
crimes judge arrested in the don’t believe Mr. Akay’s posi-
nation’s postcoup crackdown tion as a U.N. court judge pro-
so he can resume his role in an vides immunity from domestic
appeals case against a Rwan- Turkish criminal investigations.
dan convicted of genocide. The U.N. court has the
The U.N. Mechanism for the power to refer Turkey to the
International Criminal Tribu- Security Council for possible
nals said in a ruling published sanction if Turkey ignores the
on Tuesday that Aydin Akay’s court ruling, a person familiar
detention in Turkey violated with the situation said.
his U.N. diplomatic immunity Mr. Akay hasn’t been
and the principle of judicial in- charged by Turkey. The presi-
dependence, as well as Tur- dent of the U.N. court said his
key’s obligations to the U.N. imprisonment has delayed his
Mr. Akay, 66 years old, was court’s work and violated a
the presiding judge in a case main principle on which the
and oversaw procedural mo- U.N. body was established: the
tions at the U.N. court set up impartiality of judges free from
to hear appeals from the Yugo- interference from their home
slav and Rwanda war crimes country or any other nation.
tribunals when authorities ar- “The right to an indepen-
rested him at his home in Tur- dent and impartial tribunal is
key in September. an absolute right that may suf-
Turkey alleges the judge is fer no exception. To uphold
one of tens of thousands of se- this right…diplomatic immu-
cret members of the religious nity is a cornerstone of an in-
group led by U.S.-based Turk- dependent international judi-
ish cleric Fethullah Gulen, ciary, as envisaged by the
whom President Recep Tayyip United Nations,” Judge Theo-
Erdogan blames for the failed dore Meron wrote in his ruling.
July coup. Mr. Gulen denies Mr. Akay spent a career in
any role in the coup. Mr. Akay Turkey’s Foreign Ministry de-
has denied being a Gulenist. fending the state against hu-
The Turkish Foreign Minis- man-rights allegations. His de-
try didn’t respond to requests fense lawyers now say he is a
to comment. The government victim of state overreach.
RENA EFFENDI FOR THE WALL STREET JOURNAL
Alahan Akay, the wife of imprisoned judge Aydin Akay, in December.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL. Wednesday, February 1, 2017 | A9

WORLD NEWS

Quebec
Widens
Brazil Gang Hires Colombian Rebels
SÃO PAULO, Brazil—This

Its Probe country’s largest criminal or-

ganization is recruiting mem-
bers of Colombia’s once-pow-

Of Attack erful rebel group as it seeks

BY PAUL VIEIRA
Canadian police say they is-
sued search warrants in Quebec
to determine whether further
charges related to terrorism
are warranted against a 27-
year-old charged with murder
after a deadly shooting at a
Quebec City mosque.
A spokesman for the Royal
Canadian Mounted Police said
Tuesday that investigators are
determining whether terror-
ism-related charges should be
laid. He declined to elaborate.
A spokesman for the Surete
du Quebec, the provincial police
service, declined to comment
on whether police have come
heavy-weapons and other ex-
pertise to help expand its hold
over Latin America’s drug
trade, investigators and offi-
cials in both countries say.
By Rogerio Jelmayer,
Kejal Vyas and
Samantha Pearson
Defense and foreign-minis-
try officials from both nations
met Tuesday in the city of Ma-
naus in the Amazon region to
share information on how the
Brazilian criminal organiza-
tion, the First Capital Com-
mand or PCC, is working to
hire guerrillas in Colombia,
some of whom opted not to
participate in peace talks in
that country. Colombia’s gov-

closer to identifying a motive.
The RCMP, Surete and po-
lice from Montreal and Quebec
City are involved in the probe.
Quebec police charged Alex-
andre Bissonnette on Monday
with six counts of first-degree
murder and five counts of at-
The French
Canadian suspect
Alexandre
Bissonnette was
charged with six
counts of first-
degree murder.
tempted murder.
His Facebook page identi-
fied him as a student of politi-
cal science and anthropology
at Laval University and a
member of several antiabor-
tion Facebook groups.
According to an analysis
from SITE Intelligence Group,
which monitors extremism, the
majority of Mr. Bissonnette’s
public posts reflected little in
the way of his political affilia-
tion, “although select posts hint
at nationalistic leanings.” The
firm said he liked a Facebook
group of French National Front
leader Marine Le Pen.
ernment last year signed a
peace pact with the Marxist
rebel group, the Revolutionary
Armed Forces of Colombia, or
FARC, and most of its 6,000
fighters are now preparing to
disarm.
“The PCC has been offering
jobs to the FARC,” Colombia
Defense Minister Luis Carlos
Villegas said, adding an inves-
tigation is under way. Between
5% and 10% of FARC members
are expected not to accept the
peace accord, Colombian offi-
cials have said.
The PCC’s attempts to court
rebels underscore the Colom-
bian government’s challenge
in demobilizing combatants
steeped in drug trafficking.
The Brazilian gang’s bid to ex-
pand its influence into Colom-
bia comes among a surge in
Colombia’s production of coca,
the plant used in cocaine. Es-
timated potential cocaine pro-
duction rose 46% from 2014 to
2015, the last year for which
relevant United Nations data
on Colombia are available.
The PCC is trying to wrest
control of smuggling routes in
Brazil from other criminal
groups, cut out intermediaries
and work directly with Colom-
bian suppliers to deliver co-
An inmate at Brazil’s Alcacuz jail displaying the PCC gang’s initials after one of several January prison riots that left at least 120 dead.
caine to Brazil, said Lincoln
Gakiya, a São Paulo-based
prosecutor who has been in-
vestigating PCC activities for
10 years. American antinarcot-
ics officials say Brazil is the
world’s second-biggest market
for the drug after the U.S.
Created in a São Paulo
prison in 1993, the PCC has
grown into a highly disciplined
group with 21,000 members
across Brazil, Brazilian prose-
cutors say. The group’s impris-
oned kingpins control under-
lings in urban slums running
what has become the most
powerful organization in Bra-
zil’s underworld.
The PCC’s main adversary,
aside from rival gangs, is Bra-
zil’s military and federal police
apparatus outfitted with heli-
copters, armed vehicles and
modern weaponry.
“The PCC is obsessed with
getting military training,” Mr.
Gakiya said. The gang is seek-
ing .50-caliber machine guns,
which are capable of taking
down helicopters and perfo-
rating bulletproof cars, as well
as to enlist parts of the FARC’s
network of seasoned fighters
and expert bomb makers, the
The PCC seeks to
gain drug routes and
work directly with
Colombian suppliers.
prosecutor added. Email cor-
respondence between mem-
bers of the PCC in 2015 also
showed the Brazilian gang
made efforts to buy drugs
from FARC members, he said.
The FARC denies ties to
Brazilian gangs and says it is
now dedicated to peace.
In recent months, as
the PCC has set its sights on
Colombia, the gang has battled
in Brazil’s overcrowded north-
ern prisons with rivals such as
the Red Command gang for
control over trafficking routes.
The bitter conflict led to the
deaths of about 120 inmates in
early January in a series of
gruesome jail uprisings in
which many prisoners were
dismembered and decapitated.
Jorge Restrepo, director of
the Conflict Analysis Resource
Center in Bogotá, said links
between the PCC and FARC
would be cause for concern in
Colombia, where the govern-
ment is scrambling to disarm
rebels. “It would be the first
time in many years that out-
side criminal groups are work-
ing to recruit the FARC,” he
said.
The FARC is now convening
JOSEMAR GONCALVES/REUTERS
its forces in two dozen ham-
lets, with the U.N. overseeing a
disarmament process set to be
completed by midyear. Former
fighters are supposed to rein-
tegrate into society while the
group’s leadership organizes a
leftist political party.
“The peace deal between
Colombia’s government and
the FARC is fantastic,” said
Vladimir Aras, a prosecutor
who heads the international
cooperation unit of the Brazil-
ian Prosecutor General’s Of-
fice. “But it generates a side
effect, which will be the idling
of many FARC members.”
Some fighters have opted
out of the process. Guerrilla
units in the lawless jungles of
southeast Colombia, near the
Brazilian border, have broken
with the FARC over the peace
pact. The FARC leadership re-
cently expelled five dissident
commanders from that region.

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A10 | Wednesday, February 1, 2017
For China, a Reassessment of Trump
CHINA’S WORLD
ANDREW BROWNE
SHANGHAI—The officials
who look after China’s rela-
tions with the world re-
spect—even admire—a tough
negotiator. That’s how they
first thought about the chal-
lenge of Donald Trump.
Even when he rattled the
foundations of U.S.-China re-
lations by taking a call from
the Taiwan
president af-
ter his elec-
tion, their
calm re-
sponse re-
flected hopes
that he was bluffing. Indeed,
Mr. Trump encouraged the
idea by suggesting that trade
concessions from Beijing
might make his threats to
abandon America’s long-
standing “One China” policy
go away.
By now, it must be dawn-
ing on Chinese policy makers
how badly they may have
misread him. Whether ban-
ning refugees or going ahead
with a wall along the Mexi-
can border, Mr. Trump has
made clear in his first days
as president that he actually
means what he says to his
popular base.
The course appears set for
confrontation between the
two nuclear-armed giants
SHED
Continued from Page One
daily life while staying close to
home. In contrast to the man
cave—all flat-screen TV, wood
paneling and beer fridge—the
she shed leans toward the
bright, cheery and thoughtful.
What they have in common
may be motive.
“I come out here to get away
from my husband,” says Ra-
mona Jarvis, a 59-year-old resi-
dent of Austin, Texas.
The couple has been happily
married for 38 years, says Ms.
Jarvis, a certified public ac-
countant, but in their house
“every design decision, every
chair, I have to think about
him.”
Ensconced in her she shed,
which doubles as a home office
and meditation center, “it’s just
me, all me,” she says.
Marta Benson, of Marin
County, Calif., converted a stor-
age shed into a rowing studio.
Ms. Benson, an executive vice
president and general merchan-
dise manager at Pottery Barn,
is there by 5:30 a.m.
Her husband tried to store
some bike equipment there, but
she vetoed the move. Now, she
says, her family respects it as
“my sacred little space.”
Diane Schaefer, 64, was a
she-shed pioneer when she
started on hers in 2010. Ms.
Schaefer, of Des Moines, Iowa,
applied for a city permit to
build a playhouse.
“The guy behind the counter
said, ‘Look, you are going to
need to call it something else,’”
APPLE
Continued from Page One
in the context of expecta-
tions,” said David Rolfe, chief
investment officer at Wedge-
wood Partners Inc., a St. Louis
firm that counts Apple as its
largest holding.
Still, the results overall
showed that Apple continues to
struggle to regain the type of
momentum that made it the
world’s most valuable company.
The iPhone 7, while it helped
results, didn’t spark the double-
digit increase in overall sales of
iPhones that previous new
models did in their first full
quarter on the market. Unit
shipments of the iPhone
jumped 46% in the October-
December quarter of 2014 after
the launch of the iPhone 6, for
example.
Apple’s China business re-
mains a soft spot, though it
showed signs of stabilizing.
Competition in that market,
long a growth driver, has inten-
sified and Apple lost market
WORLD NEWS
A man in Beijing displays a newspaper story on Mr. Trump’s victory.
over issues that have been
stewing for years: China’s
mercantilist trade practices,
its cybertheft, military
buildup and ambitions to
dominate its neighborhood.
Chinese leaders must decide
how—or whether—to deal
with a U.S. president who
has proven more volatile and
unrestrained by diplomatic
protocol than they could
have imagined.
C
an China do business
with this White House?
The Mexican presi-
dent, Enrique Peña Nieto,
asked himself the same ques-
tion after increasingly hos-
tile exchanges with Mr.
Trump over whether Mexico
would pay for the proposed
wall—and canceled his visit
to Washington. The two
leaders later spoke by phone.
The episode stands as a
warning about how quickly
U.S. ties could unravel with
China, a far more important
relationship, and knock con-
fidence in the U.S. among its
Ms. Schaefer recalls. He sug-
gested “Victorian garden shed.”
Together with her husband,
Bill, Ms. Schaefer spent six
years working on what is now a
20-by-22 foot “sunshine-yel-
low” painted Victorian-style she
shed. It has a raised front porch
and window on the front door.
Inside is a gas fireplace and a
spiral staircase leading to a sec-
ond-story loft.
“I can walk 35 steps across
the driveway and be in this
whole other fabulous space that
is so calming and quiet and
pretty,” says Ms. Schaefer, a re-
tired college admissions direc-
tor.
She decorated with shabby-
chic antiques, including a pur-
ple armchair and a pink-painted
brass bed. The project cost
more than $80,000, she says.
Mr. Schaefer, 77, did the
heavy lifting to build his wife’s
she shed, but he usually knocks
before entering. “It really is not
a man’s space,” he says.
Home-improvement compa-
nies see she sheds as a new
way to reach women, and some
offer step-by-step guides. Home
Depot Inc.’s website has a she-
shed configurator to customize
designs. Lighting ideas include
French doors, transom windows
and skylights.
Window boxes or concrete
planters “make the shed not
look like a shed, and look like a
mini home,” says Eddie Zielin-
ski, the manager of a Lowe’s
Cos. store outside Detroit.
The website of Best Buy Inc.
has separate offerings for the
ultimate man cave and ultimate
she shed that highlight pre-
sumed taste preferences be-
share to less expensive smart-
phones from local rivals like
Oppo Electronics and Huawei
Technologies Co.
Sales in Greater China, the
world’s largest smartphone
market, fell 12% to $16.2 billion
in the quarter, Apple said. Exec-
utives blamed part of that on
currency effects and pointed to
Over the past year,
the company has
pushed suppliers to
cut component costs.
positives such as services sales.
“I’m encouraged with the
significant improvement but
we’re not without challenges
there,” Mr. Cook said on a con-
ference call.
Mr. Cook, who used to run
Apple’s supply chain before tak-
ing the top job, acknowledged
some operational missteps in
the latest period that cost Ap-
ple additional sales. The com-
outsmarted their predictable
U.S. interlocutors at every
turn. Lopsided trade flows il-
lustrate the point. U.S. tech-
nology markets are open,
China’s are closing. Where’s
the reciprocity? “They’re
NG HAN GUAN/ASSOCIATED PRESS
killing us,” Mr. Trump com-
plains.
Yet there’s a difference
between hardball negotiating
and gratuitous offense.
Mr. Peña Nieto can’t af-
ford a complete rupture; he’s
torn between national pride
and fear that Mr. Trump will
withdraw from the North
American Free Trade Agree-
Asian allies who count on ment and damage Mexico’s
the world’s two largest econ- economy. China’s trade sur-
omies getting along. Jorge plus with the U.S. dwarfs
Guajardo, a former Mexican that of Mexico. But Beijing
ambassador to Beijing, says has more cards to play. If
the Chinese leadership may Mr. Trump raises tariffs, it
conclude that attempting to can retaliate against U.S.
make nice with Mr. Trump is multinationals such as Boe-
a waste of time. Mr. Peña Ni- ing or Apple that are reliant
eto had “bent over back- on the Chinese market.
wards” to accommodate Mr.
H
Trump, he says, welcoming igh-level communica-
him to Mexico in August tion between Beijing
with all the courtesies of a and Washington is vi-
state visit. tal to prevent disagreements
Then there are the tweets. spiraling into crises. Diplo-
Chinese diplomacy is fastidi- mats agree that Mr. Trump’s
ous. Public opinion is acutely most urgent priority is roll-
sensitive to foreign slights. ing back the nuclear threat
Imagine, then, the anxiety of from North Korea. He can’t
Beijing’s leaders knowing make progress without Presi-
that Mr. Trump could blow dent Xi Jinping. That means
up a high-level meeting by striking up a personal rap-
embarrassing them with a port. An early summit would
140-character blast. help.
That’s the point, of Risk-averse Chinese lead-
course. Mr. Trump employs ers may try to wait out Mr.
impulsiveness as a negotiat- Trump, hoping he softens, or
ing tactic—the “Art of the his presidency implodes. If
Deal.” He believes—with they take the plunge and en-
some justification—skillful gage, his erratic negotiating
Chinese negotiators have style will be a wild card.
FROM PAGE ONE
tween the sexes. hidden refreshment cabinet for
For men: PC gaming station; espresso maker, electric tea
kegerator with 3-D printed tap kettle and wine cooler.
in the shape of a tiny boombox; Building a she shed from
and a “smart” putting green.
For women: a “smart” door lock
operated with a phone app;
scratch is a sizable undertaking.
Cities usually require a building
permit, and most she sheds
special lighting controls; and a don’t have running water or a
pany said several of its biggest
products suffered from insuffi-
cient supply, including the Ap-
ple Watch, its new AirPods
chip makers’ patent fees, which
amount to as much as 5% of the
average price of an iPhone.
Qualcomm has called Apple’s
wireless earbuds and the claims baseless.
iPhone 7 Plus. Demand for the The latest results follow one
larger, pricier version of its of Apple’s poorest perfor-
new smartphone was “the most mances in years as it missed in-
we’ve ever seen by far and we ternal revenue goals in its lat-
under-called it,” Mr. Cook said. est fiscal year for the first time
“We clearly missed some sales since at least 2009, leading to a
because of that.” pay cut for Mr. Cook.
Profit in the quarter fell Under Mr. Cook, Apple has
2.6% to $17.9 billion, or $3.38 a quadrupled its research-and-
share. Analysts surveyed by development spending as it
Thomson Reuters had expected looks to find new growth areas.
earnings of $3.22 a share and The company is working on au-
$77.4 billion in revenue for the tonomous vehicles and hinted
quarter. at its interest in augmented re-
Apple’s gross margin, a ality, but its secrecy makes it
closely watched measure of difficult to predict if or when
profitability, narrowed to 38.5% products would debut that
from 40.1% a year ago as new could ease reliance on the
iPhone features like longer bat- iPhone.
tery life and more memory in- The modest increase in
creased costs. Over the past iPhone sales in the latest pe-
year, the company has pushed riod came as Apple’s biggest ri-
suppliers to cut component val, Samsung Electronics Co.,
costs to protect margins as issued a recall for its Galaxy
iPhone shipments stagnate. Note 7 after some caught fire.
More recently, it filed lawsuits But sales of Samsung devices
in the U.S. and China against remained strong, particularly in
Qualcomm Inc., challenging the the U.S., where they claimed a
* ***
WORLD WATCH
IRAN
Tehran Stops Issuing Mexico Gets Apology
Visas to Americans For Tweet on Wall
The Islamic Republic has
ceased issuing visas to Ameri-
cans, the country’s foreign minis-
ter said, in an expected response
to President Donald Trump’s 90-
day ban on Iranian citizens enter-
ing the U.S.
Iran’s Foreign Ministry on Sat-
urday said it would take “recipro-
cal” and “proportionate” action
after Mr. Trump issued an execu-
tive order barring entry to the
U.S. of nationals from Iraq, Libya,
Somalia, Sudan, Syria and Ye-
men, as well as Iran. Iranian For-
eign Minister Javad Zarif con-
firmed on Tuesday that Tehran
would no longer issue visas to
U.S. citizens. He said exceptions
to the ban were possible and
specific cases would be reviewed
by a Foreign Ministry committee.
—Asa Fitch
CZECH REPUBLIC
Government Emails Manufacturers Keep
Hacked, Official Says Expanding Output
The Czech Foreign Ministry
said its email system had been
hacked by an external govern-
ment in an attack that it de-
scribed as similar to last year’s
breaching of U.S. Democratic Na-
tional Committee emails.
The hack accessed the sys-
tem employees use to email
people outside the ministry, For-
eign Minister Lubomir Zaoralek
said on Tuesday. Internal com-
munications, including classified
information, appeared safe, he
said.
Mr. Zaoralek didn’t say which
foreign government led the at-
tack, though he said the tech-
nique used was similar to the
hacking of the DNC last year.
—Drew Hinshaw
Diane Schaefer’s Victorian-style
she shed, painted in “sunshine
yellow,” took six years to build
in Des Moines, Iowa.
bathroom, due to zoning re-
strictions.
Creating a she shed doesn’t
have to be expensive, however.
Sonya Barker, a 46-year-old
home-décor blogger and stay-
at-home mom, asked her hus-
band to clear out his wood-
working tools from the shed at
their house in Piedmont, S.C.,
and store them in the garage.
As part of the deal, Ms.
Barker keeps an open-door pol-
icy, allowing entry to her hus-
band and children, ages 16 and
18. Her 16-foot by 20-foot she
shed has two leather pullout fu-
tons, a flat-screen TV and a
dartboard.
Ms. Barker’s she shed is
about 25 yards from the
kitchen—and a million miles
from her daily routine. “I don’t
iPhone Boost
Apple and iPhone revenue,
change from previous year
60%
1Q 2017*
iPhone
45
$54.4B
s5%
30
Apple
$78.4B
15
s3%
0 for its much-anticipated 10th
–15
–30
FY2014 ’15 ’16
*Ended Dec. 31, 2016 Source: the company
THE WALL STREET JOURNAL.
29% share of smartphone sales
in the quarter compared with
Apple’s 31% share, according to
consumer-analytics firm Kantar
Worldpanel.
Apple benefited from rising
THE WALL STREET JOURNAL.
ISRAEL
Israel’s president apologized
to Mexico for a tweet by Prime
Minister Benjamin Netanyahu
that appeared to endorse U.S.
President Donald Trump’s pro-
posed border wall.
A statement on Tuesday from
President Reuven Rivlin’s office
said he told Mexican President
Enrique Peña Nieto in a phone
call that there had been a misun-
derstanding.
Mr. Netanyahu tweeted on
Saturday that Israel’s barrier
along its border with Egypt had
stemmed a swell of African mi-
grants. He wrote: “President
Trump is right. I built a wall
along Israel’s southern border. It
stopped all illegal immigration.
Great success. Great idea.” Mex-
ico had demanded an apology for
the tweet. —Associated Press
CHINA
China’s manufacturing sector
ticked down a notch last month,
though it entered 2017 maintain-
ing a strong pace of expansion,
carried forward by the govern-
ment’s stimulus-fueled policies.
The official manufacturing pur-
chasing managers index fell to
51.3 in January from 51.4 the pre-
vious month, the National Bureau
of Statistics reported Wednesday.
January’s reading was the
second consecutive monthly de-
cline but the sixth straight
month the index remained above
the 50-mark separating expan-
sion from contraction.
Overall, the PMI showed an
economy that is still robust if
weakening slightly.
—Mark Magnier
feel like I have to load the dish-
washer,” she says of her mo-
ments of respite.
“Most women don’t go away
for the weekend,” she says.
“They just need to go away for
an hour on a Wednesday.”
Ranger, the family’s Irish
Jack Russell Terrier, also has a
spot there. “We built a really
big doghouse,” the husband
says, of the space.
DIANE AND BILL SCHAEFER (2)
Not exactly, Ms. Barker says:
“Once we put a big screen
down there, and he had all of
his friends to watch the football
game, he was good to go.”
Tess Harper, a mother of
two in Wyoming, Ohio, de-
signed her she shed as a home
office. The prefabricated struc-
ture has a combination cooling
and heating unit that was over-
whelmed by Ohio winters.
It isn’t a problem when the
temperature dips to 40 degrees
but when it falls to minus 18,
she says. A portable space
heater saved the day.
Ms. Harper, who works in
the medical device industry,
says it took some time for the
family to adjust to the idea of
her having her own place.
She had to explain to her
sons, ages 7 and 14, that it
wasn't a playroom.
Her husband asked about in-
stalling a cigar fan. The re-
quest, Ms. Harper says, was de-
nied.
VIDEO
Watch an
WSJ
.COM
interview with
reporter Elizabeth
Holmes
wsj.com/ahedvideo
demand for the iPhone 7 Plus,
which helped lift the iPhone’s
average-selling price in the lat-
est period to a record $695
from $691 a year ago, the com-
pany said.
The willingness of customers
to pay more for the 7 Plus of-
fers encouragement for Apple,
showing consumers will pay
more for devices loaded with
extras—in this case, a dual-
camera system and additional
random access memory. That is
encouraging as Apple looks to
set prices in the months ahead
anniversary iPhone later this
year.
Apple said the total number
of iPhone users increased by a
double-digit percentage in the
quarter. That statistic is closely
’17
watched by analysts because
the estimated value of an
iPhone customer in profit over
the two-to-three-year lifespan
of an iPhone is about $1,000,
said Abhey Lamba, senior tech-
nology analyst at Mizuho Secu-
rities. “There are very few peo-
ple who switch away from
iPhones,” he added.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
GREATER NEW YORK
Christie Fails
In Court Bid
To Override
Tenure Laws
BY LESLIE BRODY
The New Jersey Supreme
Court denied Gov. Chris Chris-
tie’s effort to reopen school-
funding litigation and over-
ride teacher tenure laws in
poor urban districts.
In a decision released Tues-
day, the court declined to hear
the governor’s motion. That
marked a victory for teachers
unions, which say tenure and
seniority rules are key to at-
tracting and retaining talent.
The ruling also means the
state’s current school-aid for-
mula remains in effect for
now, even as certain Demo-
crats and Republicans try to
overhaul it.
Opponents of tenure, in-
cluding Mr. Christie, say the
law makes it too expensive
and time-consuming to re-
move weak teachers, and se-
niority rules often mean high-
performing new teachers are
laid off during budget cuts.
The Republican governor
asked the Supreme Court in
September to reopen three de-
cades of litigation over how to
pay for schools in struggling
cities, saying that spending
nearly $100 billion on 31 dis-
tricts since 1985 hadn’t
brought good results.
In asking the court to
freeze state school aid at cur-
rent levels while he and the
Legislature devise a new
funding formula, Mr. Christie
also asked the justices for
permission to set aside the
tenure law and teachers’ con-
tracts in certain low-achiev-
ing districts.
A short order from the
court Monday said the gover-
nor’s challenges to tenure and
collectively bargained con-
tracts hadn’t been the subject
of prior litigation in the fund-
ing cases known as Abbott v.
Burke, and the court declined
to “exercise original jurisdic-
tion” to hear the matter.
A spokesman for the gov-
ernor said Mr. Christie was
considering next steps. The
court decision noted the gov-
ernor could file for relief in a
trial court.
The Education Law Center,
an advocacy group that has
fought the Abbott cases on
behalf of poor children, ap-
plauded the court’s decision
and noted it would keep the
current funding formula in ef-
fect for fiscal 2018.
The ruling comes as Demo-
cratic lawmakers hold hear-
ings on how to overhaul the
2008 school funding formula,
which many districts see as
shortchanging them.
Mr. Christie has proposed
giving each district the same
amount per pupil in an effort
to curb high property taxes,
but Democratic leaders have
rejected that method.
Megaproject on Long Island Faces Key Planning Vote
BY JOSEPH DE AVILA
After 15 years of planning
and bare-knuckle negotiating,
developer Jerry Wolkoff is on
the brink of getting approval for
his $4 billion plan to build one
of the biggest housing develop-
ments in Long Island’s history.
The Suffolk County Plan-
ning Commission plans to
vote Wednesday on whether
to recommend the project
called Heartland Town Square,
which aims to become 15 mil-
lion square feet of apart-
ments, shops and office space.
The Islip town board will have
final say over the zoning
change that Mr. Wolkoff needs
to begin construction.
Islip’s town supervisor, An-
gie Carpenter, said in an in-
terview that Heartland Town
Square would be a good op-
portunity for attracting young
people and retirees, but de-
clined to say whether she
supports the zoning change.
The development has been a
test for Long Islanders. On one
side are those who see the area
as a series of suburban bed-
room communities that provide
an alternative to New York City.
On the other side are Mr.
Wolkoff and his supporters who
say an integrated community
with shopping centers, recre-
* *
Labor Pact Set With Police Union
Officers get pay boost
of 11.73% over 5 years;
commissioner says deal
was too long in coming
BY ZOLAN KANNO-YOUNGS
AND MARA GAY
New York City Mayor Bill
de Blasio on Tuesday reached
a labor agreement with the
police union, ending years of
tense negotiations that high-
lighted a bitter divide between
the liberal mayor and the
country’s largest police force.
The five-year agreement
with the Patrolmen’s Benevo-
lent Association will cost tax-
payers $1.9 billion in total, and
cover the years 2012 through
2017.
The agreement closes a con-
tentious chapter between the
police union and Mr. de Blasio,
a Democrat who was elected in
2013 promising to curb police
powers and end what he said
From Walking on the Moon to Walking the Runway
SILVER WEAR: Nick Graham had former astronaut Buzz Aldrin, center, and TV’s ‘Science Guy’ Bill Nye model his Mars-themed collection
Tuesday at New York Fashion Week: Men’s. Mr. Aldrin and the late Neil Armstrong explored the moon on the Apollo 11 mission in 1969.
ational venues and apartments
would draw those interested in
the resources of an urban envi-
ronment without the hassle.
“It has the perfect ingredi-
ents for smart growth,” Mr.
Wolkoff said. He said his project
would benefit the region be-
cause Long Island needs to
move away from single-family
home development.
A rendering of Heartland Town Square, which developer Jerry Wolkoff wants to build in Islip, N.Y.
NY
was the overuse of the policing
tactic known as stop-and-frisk.
Thousands of police officers
turned their backs on Mr. de
Blasio after remarks he made
when a grand jury in December
2014 failed to indict a police
officer in the death of Eric Gar-
ner. Mr. de Blasio said he had
to train his biracial son in how
to approach police encounters.
Officers will receive an
11.73% pay increase, covering
the five years of the contract.
In March, they will receive a
lump sum—on average
$12,235—for retroactive pay.
The pay increase includes a
2.25% bonus that Mr. de Blasio
said was tied to the neighbor-
hood-policing initiative, a
bump that makes officers’ pay
increases higher than those ne-
gotiated by the city’s other
unions. City officials said the
police union agreed to conces-
sions that would pay for the
increase, including lower base
pay for new officers.
New officers would receive
Mr. Wolkoff dismisses con-
cerns opponents have raised
about the size of Heartland
Town Square, calling it short-
sighted. “People are frightened
of change,” Mr. Wolkoff said.
Mr. Wolkoff first proposed
redeveloping the grounds of the
now closed Pilgrim State Hospi-
tal into 9,000 units of housing
in 2002. He aims to build out
Wednesday, February 1, 2017 | A10A
union.
LEFT TO RIGHT: HANS PENNINK/ASSOCIATED PRESS; ANDREW HINDERAKER FOR WSJ
“After a lot of back and
forth and certainly some real
disagreements, we came to an
extraordinarily broad agree-
ment striking so many differ-
ent issues,” Mr. de Blasio said.
Patrick Lynch, the PBA’s
president, had launched a cam-
paign against the mayor over
the past two years, protesting
outside Mr. de Blasio’s gym in
Brooklyn and calling for a bet-
ter labor deal with the city.
“We wanted to get the
mayor and the staff to focus on
our contract, and we think it
worked,” Mr. Lynch said Tues-
day. He said the contract
“shows the uniqueness of be-
ing a New York City police offi-
cer and recognizes the added
Mayor Bill de Blasio, left, and police union president Patrick Lynch responsibility, the scrutiny
we’re under.”
a $42,500 salary for their first body camera by the end of New York Police Department
1½ years on the job under the 2019. But Mr. de Blasio said the Commissioner James O’Neill
contract, about $400 less than 2.25% bonus wasn’t tied to said the contract “was long
the current rate. body cameras. overdue.”
Under the contract, every The new deal will go into ef- “I’m glad we can put it all
patrol officer would wear a fect in March if ratified by the behind us now.
Patz-Trial
Prosecutors
Ask Jurors
To Convict
BY THOMAS MACMILLAN
Prosecutors told jurors the
man accused of killing 6-
year-old Etan Patz was a sex-
ual predator who has been
faking mental illness to avoid
a murder conviction.
That picture emerged dur-
ing a daylong closing argu-
ment by two prosecutors in
the Manhattan courtroom
where Pedro Hernandez faces
charges of murder and kid-
napping related to Etan’s
1979 disappearance.
Assistant District Attor-
neys Joan Illuzzi and Joel
Seidemann’s case summa-
tions followed closing state-
ments by defense lawyer Har-
vey Fishbein, who on
Monday sought to convince
jurors that Mr. Hernandez
gave a false confession after
a lengthy and aggressive po-
lice interrogation.
Mr. Hernandez told police
in 2012 that he had lured
Etan into the basement of a
bodega where he worked,
near the child’s school bus
BEBETO MATTHEWS/ASSOCIATED PRESS
stop in Manhattan’s SoHo
neighborhood. He told police
he strangled the child, put his
body in a box and left it in a
nearby alley.
Defense lawyers argue that
those statements were false,
a result of Mr. Hernandez’s
severely limited intelligence
and a mental illness that pre-
vents him from distinguish-
ing facts from fiction.
Prosecutors Tuesday ar-
gued that Mr. Hernandez’s
confession was genuine, and
corroborated both by other
statements he made before
his arrest and the fact that he
the project in the town of Islip ity,” said Donna Periconi with had information that only the
in phases over 30 years. the Chamber of Commerce of killer could have known.
His longtime critics still say Greater Bay Shore. “This is the “I submit the defendant
a project of this size isn’t right end of Long Island being an al- was keenly watching and ad-
for Suffolk County. The first ternative to city life.” miring this beautiful, friendly
phase calls for about 3,500 Opponents also are worried child,” said Ms. Illuzzi.
apartments and more than 1 about increased traffic and the Ms. Illuzzi said Mr. Her-
million square feet of shops and cost of upgrading surrounding nandez told police correct de-
office space. roads and highways to accom- tails about a bag Etan was
“It’s a megacity, and it can’t modate the new residents who carrying, gave accurate ap-
be called anything but a megac- would live in Heartland Town proximations of the child’s
Square. Ms. Periconi said Mr. height and weight, and accu-
Wolkoff should be on the hook rately described the location
for making improvements on where he said he left the
the nearby Long Island Express- body.
way and Sagtikos Parkway for In the years after Etan’s
the increased use. disappearance, Mr. Hernan-
Mr. Wolkoff has said up- dez several times told ac-
grades to those roadways quaintances and family mem-
need to happen whether or bers he had killed someone in
not his project goes forward, New York, according to wit-
and that he will pay $75 mil- ness testimony. Ms. Illuzzi
lion for upgrading sewers, noted that witness memories
roads and water systems to of those statements all share
support the project. consistent elements, includ-
Jennifer Casey, chairwoman ing the involvement of a boy
of the Suffolk County Planning or young man.
Commission, said she is largely After his arrest, the defen-
supportive of the project but dant’s story began to change,
has some concerns. Ms. Casey incorporating bizarre details
said she would like to see the as he sought to convince psy-
ELKUS MANFREDI ARCHITECTS
project include pedestrian and chologists that he is insane,
bike access to reach the nearby Mr. Seidemann said.
Deer Park station of the Long Mr. Seidemann closed the
Island Rail Road. day by showing jurors a large
“This is a project that can be portrait of Etan, describing
such a benefit for Long Island, the boy as a “sweet angel”
but it needs to be properly whom the defendant sent to
planned,” Ms. Casey said. “an early grave.”
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
A10B | Wednesday, February 1, 2017 NY * * THE WALL STREET JOURNAL.

CITY NEWS

Goodwill Hunting:
How a CEO Shops
For Business Wear
When you run a big While Ms. Gaul-Stigge
clothing retailer, you have to earns $300,000 a year, she
flaunt your company’s fash- is proof that a person can
ions. And that’s pretty easy dress for success on a bud-
when you’re heading an up- get. Goodwill prices for
scale chain. dresses and blazers, for ex-
But I was intrigued to ample, start at $13. Dress
learn that Katy Gaul-Stigge shirts and blouses start at
wears her company’s styles $8.
every day. The craziest bargains are
She is, after found at Goodwill’s Queens
all, the chief clearance outlet, where any-
executive of thing that doesn’t sell in the

BESS ADLER FOR THE WALL STREET JOURNAL (2)

Goodwill
NYNJ.
METRO While the
MONEY nonprofit’s
ANNE KADET selection
can’t be
beat—its 42
stores each
offer up to 10,000 unique
items—imagine basing your
executive wardrobe on thrift
store finds.
I asked her to take me
shopping.
We met Monday morning
at the newest location on
First Avenue and East 61st
Street in Manhattan. Dona-
tions here triple over the
weekend, to 600 items a
day, so the week’s start of-
‘It might be a little
big, but I don’t
overthink the sizes....
That’s part of the fun.’
fers great selection, she
says. And the chain’s Upper
East and Upper West Side
locations are especially good
for business wear.
Ms. Gaul-Stigge was al-
ready dressed in favorite
Goodwill finds, including a
blue Banana Republic sheath
dress, a Cynthia Rowley
jacket with pleather sleeves
and a boxy handbag. The
whole shebang cost about
$60.
stores after four weeks goes
for $1.79 a pound or less.
“It’s an amazing experi-
ence for the hardy shopper,”
she says.
Ms. Gaul-Stigge headed
for the dress section. Items
are arranged by color rather
than size to make organiza-
tion easy for disabled em-
ployees, and she forced her-
self to bypass the black
rack. “I’m getting into more
colors,” she says, eyeing a
green knit from Joe Fresh.
The price: a relatively
steep $25. And Goodwill can
charge more for designer la-
bels.
Down in the store’s base-
ment, a team of three was
pricing the day’s donations
according to a chart taped
to the wall.
Brands like L.L. Bean and
DKNY are tagged with a
base price. “Boutique” la-
bels, including Versace and
Gucci, cost up to double.
While Goodwill aims to
be affordable, it faces the
same challenges as any re-
tailer. Last year, it rang up
$55 million in sales, but
thanks to the city’s high
rents and rising wages, $51
million went to operating
expenses.
Every penny counts.
While the stores provide
job-training opportunities,
revenue also supports pro-
grams ranging from summer
camps to career planning for
refugees.
Still sorting through the
Katy Gaul-Stigge, at Goodwill NYNJ’s store at First Avenue and East 61st Street in Manhattan. A sampling of the thousands of selections.
racks, Ms. Gaul-Stigge pulled
a red Express wrap dress
and a teal floral from J.
Crew.
“It might be a little big,
but I don’t overthink the
sizes when I’m here,” she
says. “That’s part of the
fun.”
Even when you’re the
boss at Goodwill, there’s a
wait for the fitting room.
The stores are bustling.
Sales grew 64% over the
past five years, thanks to in-
creased donations and store
openings.
This year, Goodwill hopes
to pass the 1 million donor
mark by opening two addi-
tional stores and extending
a new effort to collect dona-
tions at stands near subway
stops.
Ms. Gaul-Stigge finally
got a chance to try on her
finds. Oh, lucky day—every-
thing fit. The total for three
dresses, a print blouse and a
necklace: $50.95.
At the cashier’s prompt-
ing, Ms. Gaul-Stigge rounded
her payment up to $51, an-
other revenue-boosting ex-
periment.
I called a couple of days
later to see how she was
faring with her finds.
“I put on the green dress
today, but I went back to a
black dress,” she said. “I
couldn’t help myself.”
At least, she notes, she
bought the black Calvin
Klein at Goodwill.
anne.kadet@wsj.com

GREATER NEW YORK WATCH

THE BRONX
Teacher Faces Count
Of Animal Fighting
Federal prosecutors have ac-
cused a New York City teacher
of breeding and training roosters
for cockfighting in his Bronx
backyard.
Hector Cruz, 59 years old,
faces one count of animal fight-
ing, according to the office of
Manhattan U.S. Attorney Preet
Bharara. The charge came out of
an investigation by the New York
Police Department and U.S. De-
partment of Agriculture into the
breeding of roosters for cock-
fighting, the complaint said.
An attorney representing Mr.
Cruz declined to comment. Mr.
Cruz has worked for the Depart-
ment of Education since 1996
and was most recently an Eng-
lish as a Second Language
teacher at P.S. 211 in the Bronx,
a department spokesman said.
Mr. Cruz, who earned an annual
salary of $94,173, has been reas-
signed outside the school for the
time being, the spokesman
added.
—Corinne Ramey
NEW JERSEY
School Locked Down
After Threat Posted
Linden High School was
placed on lockdown for several
hours Tuesday after someone
posted a photo on Instagram
showing a rifle placed over a
car’s steering wheel and threat-
ened a shooting at the building.
The lockdown started shortly
after 9 a.m., when the threat
was discovered, and ended
around 1 p.m. after police made a
thorough search of the building;
students were dismissed a short
time later.
Some parents said their chil-
dren had sent them texts during
the lockdown saying the stu-
dents were scared.
—Associated Press
CONNECTICUT
Malloy Rejects Idea
Of Hedge Fund Tax
Gov. Dannel Malloy is dismiss-
ing an effort by Democratic law-
makers to tax hedge fund man-
agers to help close a $1.5 billion
budget deficit.
“It’s not a discussion that I
think is in the best interest of
Connecticut to lead,” Mr. Malloy
said Tuesday. “It would be detri-
mental to the state at this point
to do that.”
Democrats want a 19% sur-
charge on investment manage-
ment service fees. The surcharge
would raise $535 million in an-
nual revenue, the lawmakers
have said.
Republicans and the hedge
fund industry say the measure
could drive business out of state.
—Joseph De Avila
NEW YORK
Vote Set on Pensions
Of Convicted Officials
New Yorkers will vote this fall
on a proposed constitutional
amendment that would allow a
judge to strip or reduce the pen-
sions of public officials convicted
of corruption.
If approved by the voters the
measure would apply to lawmak-
ers, top municipal and state offi-
cials, gubernatorial appointees
and agency heads.
—Associated Press

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 For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL. * * * * Wednesday, February 1, 2017 | A11

LIFE&ARTS
MUSEUMS

An Innovator at the Vatican

Museums’ new director, Barbara Jatta, aims to focus on conservation, restoration and crowd control
BY FRANCIS X. ROCCA

Vatican City
THE VATICAN is a famously
male-dominated institution, but on
at least one count, it’s beaten the
secular world in creating opportu-
nities for women.
Pope Francis’s decision to ap-
point Barbara Jatta as director of
the Vatican Museums in Decem-
ber makes it the first of the
world’s most important museums
to have a woman at the helm—
ahead of the Metropolitan Mu-
seum of Art, the British Museum,
the Prado Museum and the Louvre.
Her appointment reflects a lit-
tle-known tradition of innovation
that belies the Vatican’s image as
hidebound and backward, says Ms.
Jatta, 54. She intends to exploit
the museums’ technological exper-
tise, as she also confronts major
financial, administrative and
crowding challenges.
It is an especially important ap-
pointment for the Vatican, given

CLOCKWISE FROM TOP: ROCCO RORANDELLI FOR THE WALL STREET JOURNAL; THE VATICAN MUSEUMS (2)
that the museums are a major
source of revenue, with about
€300 million ($323 million) in
gross revenues a year and at least Barbara Jatta, new director of the Vatican Museums, above, in the Greek-Roman ‘Museo Gregoriano Profano,’ a closed wing set to reopen this year. Below left,
€40 million in profits. restoration in the Vatican Gardens; right, Maria Ludmila Pustka (center), head of the painting restoration laboratory, with staff members.
“I benefit somewhat
from the desire of Pope
Francis to show open-
ness in so many ways,”
said Ms. Jatta, who over-
saw the Vatican Library’s
collection of rare prints
before starting her cur-
rent job in December.
“But I hope I was chosen
because of what I did in
the Vatican over the last
20 years.”
The modern spirit of
the Vatican Museums, to-
day the home of the Sis-
tine Chapel with its fa-
mous Michelangelo
frescoes, as well as works
of art by Raphael, Giotto
and Titian, is rooted in
history. Pope Julius II
shared his sculpture col-
lection with scholars and poets in says the new director. Getty Conservation Institute. six million visitors per year, a 40% large proportion of the visitors,
the early 16th century, and Pope For instance, the Vatican has Ms. Jatta will oversee comple- rise in 10 years. Ms. Jatta hopes to spread out the
Clement XIV opened the doors to a conducted work in using essential tion of an overhaul of Vatican Mu- At the height of the summer flow to make the experience in
wider public in 1771—both rare ges- oils to protect sculptures and other seums’ website, which had lagged tourist season, as many as 28,000 those areas less stressful for peo-
tures for their times. stone works from biological degra- behind rivals’ efforts to engage and people walk through the Sistine ple and the artworks themselves.
A major focus for Ms. Jatta will dation, says Admir Masic, a profes- inform visitors with lively graphics Chapel and the rooms in the Apos- That means getting people to
be sustaining the technological sor of civil and environmental engi- and information. Once complete, tolic Palace decorated with fres- spend more time in lesser-known
prowess of the museum, which neering at the Massachusetts the new site, which now features coes by Raphael in the course of a parts of the museum complex, in-
boasts eight conservation labs and Institute of Technology. Mr. Masic video and virtual tours of various day. In the Sistine Chapel alone, cluding the Etruscan Museum, one
more than 150 full- and part-time collaborated with museum staff in parts of the museums, will feature dust left by visitors over the of the most valuable collections of
restoration experts undertaking the early stages of the 2008-2014 an online catalog containing im- course of a year—much of it the artifacts from that ancient Italian
advanced work with lasers, nano- restoration of the 17th-century col- ages and descriptive information accumulation of microscopic bits civilization. A large elevator will
technology and bio-technology. onnade built by Gian Lorenzo Ber- for more than 10,000 objects. of human hair and skin—takes be installed to facilitate access to
The extraordinary breadth of nini around St. Peter’s Square. For all her enthusiasm about in- weeks to remove in an annual that museum, which in addition to
the museum’s collections—which The oils are an example of re- novation, one of Ms. Jatta’s major cleaning, Ms. Jatta said. the glories of its collection, boasts
range from ceramics to tapestries placing often-toxic synthetic sub- tasks is a conservative one: to To minimize the damage such a 360-degree panorama of Rome.
to mosaics—offers its technicians stances with natural materials, the manage the attendance that has crowds inflict on the works of art She hopes to attract visitors to
and conservators the opportunity better to protect the restorers and boomed in recent years and now and improve the visitors’ experi- other relatively neglected trea-
to find new ways of caring for ev- the environment as well as the ob- reached the limits of what the his- ence, the museums have installed sures, too, including ancient sar-
erything “from Indian feathers to jects themselves—a priority under toric buildings, central attractions new energy-saving LED lighting in cophagi in the Pius-Christian mu-
hair in the Ethnological Museum a pope who dedicated an entire in themselves, can bear. the Raphael rooms and will soon seum. Non-Christian art is also
to Japanese tatami,” Ms. Jatta encyclical to the environment. Her predecessor vastly boosted install new air conditioning sys- abundant in the Egyptian Museum,
says. “I don’t think there is an- “The marble conservation labo- attendance, with a reservation sys- tems there, following a similar the Greek-Roman Museo Gregori-
other example…of so many and ratory at the Vatican is among the tem that reduced waiting time in light-and-air project undertaken in ano Profano and the Ethnological
such highly qualified restorers and leading groups working on green lines and extra opening hours in 2014 in the Sistine Chapel. Museum, which features works
other professionals working with and sustainable conservation solu- the mornings and evenings. The Working with tour guides and from non-Western cultures, dating
many different types of material,” tions,” said Leslie Rainer of the museums now receive more than the companies responsible for a from prehistoric times to today.

The Belgian designer MEN’S FASHION

is known for

RAF SIMONS BRINGS BUZZ

experimenting with
colors, prints and
fabrics, as well as
proportions, as
with these
looks from
his past
TO NEW YORK SHOWS
shows.

BY RAY A. SMITH thought it over from the point of
view that I would possibly be the
activator for New York: Men’s or
THE FLEDGLING the savior for New York: Men’s,”
New York Fashion the Belgian designer said in an in-
Week: Men’s is get- terview last week at Calvin Klein
ting a much-needed headquarters in New York. “But I
surge of star wattage would be more than happy if I
this season with the could be a help.”
addition of Raf Si- For the Council of Fashion De-
mons, one of the most widely re- signers of America, he already has.
spected and influential designers. “Raf is a big name to add,” said
Mr. Simons, who was named Steven Kolb, president and chief
chief creative officer of Calvin executive of the CFDA. “He has
Klein Inc. in August, is pre- been a great draw in terms of add-
senting his eponymous men’s ing an importance to what we’ve
FROM LEFT: RAF SIMONS (2); GETTY IMAGES
Some attendees complained that
the New York event, which tends
to showcase more commercial de-
signs, was anticlimactic compared
with shows in Florence, Milan and
Paris. Some high-profile American
designers like Thom Browne have
elected to show their collections in
Europe, while brands such as Mi-
chael Kors and the buzzy young la-
bel Public School are going back to
showing their men’s lines with wo-
menswear in one coed show at the
larger New York Fashion Week.
Mr. Kolb acknowledged a “bit of
a struggle in terms of the diversity

line in New York instead of
Europe for the first time in 21
years, raising a chorus of ho-
sannas from American mens-
wear enthusiasts. His Wednes-
day runway show is one of
the most anticipated of the
fall 2017 men’s fashion
week, which began Mon-
day and ends Thursday.
“I never really
been building over the last three
seasons. That is very inspiring and
motivating to the other designers
who have been showing here.”
The CFDA organized New York
Fashion Week: Men’s in 2015 to
capitalize on the sales boom in
men’s clothing and to woo back
designers who had been showing
in Europe.
But the program has struggled.
of aesthetic” in the past, but said
organizers have focused on adding
a broader mix of brands, with the
addition of Mr. Simons, Hugo Boss
and others.
Since launching his namesake
collection in 1995, Mr. Simons has
been known for an avant-garde ap-
proach to menswear. The self-
taught designer experiments with
Please see FASHION page A13
A12 | Wednesday, February 1, 2017 THE WALL STREET JOURNAL.

LIFE & ARTS

Dennis Chan, 71, owner of the
Redi-Gro garden products com-
pany from Sacramento, Calif., on
his collection of 30 trucks, as told
to A.J. Baime.
Some people collect stamps, oth-
ers coins. I have 30 trucks, of the MY RIDE
18-wheeler kind (the trucks them-

A Collector
selves, not as many trailers). The
oldest is a 1944 Peterbilt, and the
newest is a 1982 Peterbilt. I have
restored them all, and they are all

Goes Big
painted the same color scheme.
I started driving trucks when I
was old enough to see out the
windshield—probably 6 years old.

With Rigs
We were a farming family in
Courtland, Calif., and at a young
age, I started riding in the trucks
with the drivers in summertime. I
fell in love with these trucks, so
every night, I would line them up
in a row on our property, just so I
could drive them.
My current collection I keep in
a big warehouse, and I go out on
Sundays and start up the engines.
To me, these vehicles are unsung
heroes, the workhorses of the
American economy. I also have five
pickups, all Fords. The oldest is a
1954, the vehicle I drove when I
first got my driver’s license.
I’ve been president of our local
chapter of the American Truck His-
torical Society for 16 years. Every
year, I attend about a dozen truck
shows around the country. (These
are like car shows, only for trucks.)
Usually once a year my friends and
I drive our trucks across country
to attend a show.
I take a truck that has Sirius ra-
dio, air conditioning and other
comforts, and we stay in hotels.

MAX WHITTAKER FOR THE WALL STREET JOURNAL (3)

We’re not real truckers. We’re out
having fun.
In 2010, the society’s national
show was in Pleasanton, Calif., not
far from where I live. I arranged to
have all 30 of my trucks there. The
logistics were a mess! But it was
worth it.
The truck pictured here, a 1953
Peterbilt, is the most special in my
collection. It was the first Peterbilt
my family bought, when we up- in our fleet, so it has driven easily will be our show’s 31st year. Every
graded our fleet in 1963, so it has over a million miles. year is more fun than the last.
sentimental value. It cost $5,000 This April 29, our local histori-
in 1963. For years before I retired cal truck society chapter will host Contact A.J. Baime at Dennis Chan with his 1953 Peterbilt, above and top, in Sacramento, Calif.
this vehicle, it was a working truck our show in Plymouth, Calif. This facebook.com/ajbaime. A look at the truck’s interior, above left.

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 For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL. Wednesday, February 1, 2017 | A13

LIFE & ARTS

CULTURAL COMMENTARY

Pioneering Diversity on Screen

By telling their unique stories, figures like Julie Dash and Sara Gómez helped pave the way for underrepresented filmmakers.
BY KRISTIN M. JONES

WHEN JULIE DASH’S “Daughters

of the Dust” (1991) was re-released
last fall in a new restoration, it
marked the return of one of the
most dazzling independent films in
recent decades. A lyrical tapestry
of words, sounds and images, Ms.
Dash’s story of three generations
of a Gullah family in 1902 as many
are preparing to migrate north has
CLOCKWISE FROM LEFT: EVERETT COLLECTION; NEW YORKER FILMS; UCLA FILM AND TELEVISION ARCHIVE

inspired other directors, while its

originality is a reminder of the
continuing need for more diverse
perspectives on screen.
That re-release followed the res-
toration and theatrical release of
Kathleen Collins’s luminous feature
“Losing Ground” (1982), about a Julie Dash’s 1982 ‘Illusions’ (below) influenced Larry Bullard and Caro-
young philosophy professor (Seret and 1991 ‘Daughters of the Dust’ left; lyn Johnson’s “A Dream Is What
Scott) who embarks on an intellec- above: Sara Gómez’s ‘One Way or You Wake Up From” (1978), tracing
tual and emotional journey during Another’ (1974) lives in the U.S.
a summer idyll. Collins—a civil- Films also document the
rights activist, playwright, fiction achievements of novelists,
writer and filmmaker who died in artists and performers, in-
1988—first directed the magical- cluding two dance pio-
realist featurette “The Cruz Broth- neers: Syvilla Fort in Ay-
ers and Miss Malloy” (1980), which oka Chenzira’s “Syvilla:
has also recently been restored. They Dance to Her Drum”
These works are in the stellar (1979) and Thelma Hill in
series “One Way or Another: Black Kathe Sandler’s “Remem-
Women’s Cinema, 1970-1991,” bering Thelma” (1981). Mi-
opening Friday at Brooklyn, N.Y.’s chelle Parkerson’s
BAMcinématek (where The Wall “Stormé: The Lady of the
Street Journal is the title sponsor). Jewel Box” (1987) is a por-
Programmed by Nellie Killian of trait of the drag performer
BAMcinématek and Michelle Ma- Stormé DeLarverie, central
terre, founder/host-producer of the to the Stonewall uprising.
Creatively Speaking Film Series, Creative legacies are as
the retrospective offers an array of I’ve become an illusion.” But at the ade,” summons a dreamlike poetry portraits “Suzanne, Suzanne” vital as ancestral ties in this retro-
films made in the two decades be- conclusion she is determined to with its indelible images of charac- (1982), about a young woman spective. The talented, resourceful
fore “Daughters of the Dust.” keep working, realizing Esther ters preparing food, picnicking by struggling with memories of abuse women behind the camera paved
These include “The Cruz Broth- helped her “see beyond the shad- the ocean, or visiting an ancestral and addiction, and “Finding the way for generations of filmmak-
ers and Miss Malloy” and several ows dancing on a white wall.” graveyard, to the sounds of animal Christa” (1991), which poignantly ers whose work also deserves wider
Dash shorts. Among the latter is Ms. Dash’s recent short “Stand- life and lapping waves. and exuberantly chronicles the attention. As Mignon says in “Illu-
the revelatory “Illusions” (1982), ing at the Scratch Line” (2016)— Other impressionistic and for- filmmaker’s reunion with a daugh- sions,” “there are many stories to
which imagines a studio executive, combining contemporary footage mally daring films include ter she gave up for adoption. be told and many battles to begin.”
Mignon Dupree (Lonette McKee), and archival photographs—is a Zeinabu irene Davis’s hypnotically Taking a bracing variety of ap-
passing for white in 1940s Holly- haunting meditation on the Great edited experimental short “Cy- proaches, films in the series ad- Ms. Jones writes about film and
wood. Some of its most powerful Migration and the sanctuary found cles” (1989), in which a young dress subjects from civil rights to culture for the Journal.
scenes unfold after Mignon en- in the African Methodist Episcopal woman does housework and gender equality. The series bor-
counters a young singer, Esther Church. Also navigating between bathes while waiting to learn if rows its title from Sara Gómez’s
One Way or Another: Black
Jeeter (Rosanne Katon), whose past and present, “Daughters of she is pregnant. “One Way or Another” (1974),
Women’s Cinema, 1970-1991
voice is dubbed over a white ac- the Dust,” which influenced Be- Documentaries by Camille Bil- which blends documentary and fic-
tress’. Mignon tells Esther, “Now yoncé’s 2016 visual album “Lemon- lops include the riveting family tion and is set in Castro’s Cuba. It BAMcinématek, Feb. 3-23
FROM TOP: WILLY VANDERPERRE; ASSOCIATED PRESS

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FASHION
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the longtime practice of having guests at his Jil Sander in Milan for seven years.
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mons said the audience and also my experience
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For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
A14 | Wednesday, February 1, 2017 THE WALL STREET JOURNAL.

SPORTS
HEARD ON Tom Brady before a Jan. 1 game;
THE FIELD below, author Don Miguel Ruiz

How Much Are 5-Star

Recruits Really Worth?
The first Wednesday of February
has become an annual holiday
where people manically obsess over
where a bunch of teenagers will go
to college. It’s known as National
Signing Day, and it’s the first time
high school seniors can officially
sign with schools to play football.
But as fans wonder if this year’s
batch of recruits will lead their
team to a title, two researchers
looked for an answer to a slightly
different question: How much are
these recruits actually worth?
The best ones may be worth
$465,000 annually, according to an
analysis by Trevon Logan, an eco-
nomics professor at Ohio State, and
Stephen Bergman. In their paper,
which was published in the Journal
of Sports Economics last year, they
examined how success at every
school changed as the caliber of
their recruits at that school differed
over time. Then they could answer
how much more money a school
could stand to make when it signs
better players.
“The hype around signing day
can be overblown at times,” Berg- SUPER BOWL LI | Jason Gay
man said, “but financially these re-
cruits have significant effects on
the programs.”
That $465,000 value of five-star
recruits—players regarded as the
best high-school prospects—is more
than double that of four-star play-
Meet Tom Brady’s Shaman
ers, they found, at $181,000. Three-
star players averaged $60,000 in How well do we to refresh. has a hazardous ability to influ- which he endured the worst press
value while two-star ones netted a know Tom Brady, re- I was intrigued. A lot of people ence us. If we give too much cre- of his life. “Definitely it will help a
loss of $75,000. Basically, a team ally? In interviews, New desire an existence like Tom dence to this outside dream, lot,” Ruiz said. It was essential for
that depended on two-star rated England’s quarterback Brady’s, since Tom Brady is 39 but stressing over the actions and Brady to not let chatter get to him,
players would expect to lose is polite but vigorously looks 29, and just might live for- opinions of others, Ruiz says we he said.
money. on-message, the human embodi- ever, because he takes care of his set ourselves up for a life of hell- “When you have that aware-
These values stem not only from ment of coach Bill Belichick’s im- mind and body and doesn’t eat a ish misery (sort of like Brady’s ri- ness,” Ruiz said, “it can help you
the balance sheets of the football penetrable, don’t-stir-the-pot Pa- tube of sour cream and onion Prin- val head coaches in the AFC East.) in whatever interaction you have
programs, which can receive major triot Way. While Brady does offer gles every night. To avoid this trouble, Ruiz of- in any situation.”
windfall by reaching high-profile occasional flashes of personality, Today, if you’re inclined, you fers his “Agreements.” They are: 1. This same advice also applied to
CLOCKWISE FROM TOP: REINHOLD MATAY/REUTERS; DON MIGUEL RUIZ; DAVID GRUNFELD/THE TIMES-PICAYUNE/ASSOCIATED PRESS

bowl games, but also from the suc- the veteran QB is also a PR pro, can buy Brady’s “nutrition man- Be impeccable with your word. 2. praise, Ruiz said. That should be
cess of each school’s conference. seldom deviating from his ritual of ual,” with eccentric recipes like av- Don’t take anything personally. 3. tuned out as well. This sounded
That’s because schools stand to smiling and not revealing much. ocado ice cream, or his $200 “re- Don’t make assumptions. 4. Al- like wisdom amid a week in which
gain from the success of their Once in a while, however, Brady covery sleepwear” from Under ways do your best. everyone in Houston is talking
league: An elite player that goes to does open a door into his inner Armour. I was not interested in This is all estimable, sensible about Brady as possibly the best
Michigan may help the Wolverines self. In recent years, he’s men- that. I’m not craving avocado ice advice, even for an iconic quarter- quarterback of all time.
beat Ohio State, but the Buckeyes tioned his admiration for a book cream, and if I bought a pair of back chasing a fifth title. “We can hear the greatest opin-
may benefit too because portions called “The Four Agreements: A $200 pajamas, my wife would call I spoke to Ruiz on Tuesday ions about us, but we know the
of conference revenue are shared. Practical Guide to Personal Free- our accountant and chase me out morning. He said he first became truth,” Ruiz said. “We know what
—Andrew Beaton dom,” a “Toltec Wisdom Book” of the house. aware of Brady’s interest in his we are. It’s not necessary for
written by a modern-day shaman The book, though, I could han- book when the quarterback spoke someone to come and tell us how
from Mexico named Don Miguel dle. I picked up a copy of “The about it publicly. While he has yet great we are.”
Ruiz. A year ago last fall, during Four Agreements” at Barnes & No- to meet Brady, Ruiz said he was Ruiz said he’s become more of a
an interview with a Boston radio ble and read it in a couple of “very pleased he’s read the book. football fan in recent years, and
station WEEI, Brady described the hours. And more than that, that he’s ap- plans to watch the Super Bowl
book as “kind of a mantra for my To be clear: Ruiz’s book is not a plied it in his life.” Sunday at home in Las Vegas. “It’s
life,” and indicated it helped him “Da Vinci Code”-type potboiler. Brady is not the first celebrity a piece of art, and I just love it,”
navigate the urgent intergalactic Nor is it a manual of direct, busi- to warm to Ruiz’s teachings. The he said of the sport. He said he ex-
crisis that was “Deflategate.” ness-like advice, a la Dale Carne- bestseller received the coveted pected Brady to adhere to the
On Monday, Brady spoke about gie. Instead, it’s a pleasant, mysti- blessing of Oprah Winfrey, who fourth agreement, and do his best.
“The Four Agreements” with the cal examination of personal read it after Ellen DeGeneres rec- Still, Ruiz declined to make a
Journal’s Matthew Futterman: identity—and what the author sees ommended it to her. prediction between the Patriots
Timing in life is important in a as the potential perniciousness of Janet Mills, Ruiz’s publisher, and Falcons.
lot of things, and sometimes you outside influences. said that Brady’s endorsement was “This game is very even,” Ruiz
get something when you are par- Ruiz contends that what we see like a “second Oprah.” said. “Either team can win, but the
ticularly open to learning it. That and experience in our lives is “He’s done an enormous thing most important thing is to see the
book was something that came nothing but a dream. “You are by talking about it,” Mills said of game, to enjoy it, because it is
around to me at the right time. My dreaming right now in this mo- Brady. beautiful.”
wife [Gisele Bündchen] actually ment,” he writes. “You are dream- Ruiz and I talked about the Sec- On Sunday, 100 million or so
gave it to me. ing with the brain awake.” At the ond Agreement—don’t take any- American football fans will proba-
Running back Leonard Fournette, I take everything from it. There same time, he claims, we are sur- thing personally—since it seemed bly be in agreement. If you aren’t,
a five-star recruit, commits to LSU isn’t a wrong word in that book. I rounded by the dreams of soci- to have obvious application to Tom Brady and his shaman won’t
on National Signing Day in 2014. read it every couple of years just ety—the “outside dream”—which Brady’s “Deflategate” travails, in take it personally.

Weather The WSJ Daily Crossword | Edited by Mike Shenk

Shown are today’s noon positions of weather systems and precipitation. Temperature bands are highs for the day.
d t
Edmonton -0s 0s <0 1 2 3 4 5 6 7 8 9 10 11 12 13 Down 34 Affirmative
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TURN SIGNALS | By Paul Coulter breath
13 Nepal bearer
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Boston 43 29 sn 39 22 s Salt Lake City 44 31 pc 46 35 pc Madrid 54 44 c 53 41 r 37 Vodka cocktail, 61 TAB 27 Reed that’s
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Solve this puzzle online and discuss it at WSJ.com/Puzzles.
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For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
Incompetence Is the Norm
A leader who
makes deci-
sions of
sweeping im-
port without
thinking
through the
BUSINESS
WORLD c o n s e -
quences?
By Holman W.
This charge,
Jenkins, Jr.
l e v e l e d
against Pres-
ident Trump, is in fact a dem-
ocratic redundancy. It applies
widely, maybe universally.
Case in point: After 12 years
Germany will be deciding in
September whether to re-elect
just such a leader. Her name is
Angela Merkel.
Mrs. Merkel’s list of ill-con-
sidered policy spasms include:
• After the Japanese tsu-
nami and earthquake, she pre-
cipitously ordered the closure
of Germany’s 17 nuclear plants.
Never mind that not a single
death, among the 18,000 in the
Japanese earthquake and its
aftermath, was caused by radi-
ation exposure—though 1,600
deaths are estimated to have
resulted indirectly from the
unnecessary evacuation of
300,000 Fukushima prefecture
residents.
• With her Energiewende,
she ordained Germany’s forced
march toward renewable
power, which recently collided
with stable high-pressure sys-
tems that left Germany cloudy
and windless for three weeks.
Now Germans learn, at cata-
strophic expense, they must
maintain duplicate power sys-
tems, one running on coal.
Germany’s CO2 emissions are
higher than when Mrs. Merkel
started.
Nothing Redeems Trump’s Travel Ban
President
Trump’s exec-
utive order
temporarily
halting the
admission of
POLITICS all refugees as
well as indi-
& IDEAS
viduals from
By William
seven Muslim-
A. Galston
majority
countries is
deeply misguided. I will spare
my readers an extended solilo-
quy on the violence the order
does to our identity as a “na-
tion of immigrants,” even
though it has what I fear is the
increasingly antique merit of
truth, in favor of more con-
crete concerns.
First, the order is probably
unconstitutional. As federal
Judge Ann Donnelly wrote in
issuing an emergency stay
preventing two refugees from
being returned to their home
countries, “The petitioners
have a strong likelihood of
success in establishing that
[their removal] violates the
rights to Due Process and
Equal Protection guaranteed
by the United States Constitu-
tion.” To be sure, the petition-
ers are not citizens. But the
14th Amendment distinguishes
clearly between the privileges
and immunities of “citizens,”
on the one hand, and the due-
process and equal-protection
rights of “persons” on the
other.
The president’s executive
order may also violate the Es-
tablishment Clause. The White
House insists that the order
does not create a religious test
You’d Look Good in Designer Genes
By Henry I. Miller
H
ave you heard that
growing genetically
modified corn or soy-
beans is harmful to the envi-
ronment? Or that eating ge-
netically modified food causes
allergies or cancer?
Many food activists and
radical environmentalists have
spread misinformation about
genetic engineering, attribut-
ing to it nonexistent risks, in-
juries and deaths. Some activ-
ists have even vandalized the
field trials designed to per-
form exactly the sort of (su-
perfluous) risk assessment
that they demand.
Genetic engineering doesn’t
harm the environment; quite
the contrary, because it re-
duces the spraying of insecti-
cides and increases yields, con-
serving water and arable
farmland. Not only has geneti-
cally modified food not harmed
anyone, but it is offering prod-
ucts that appeal directly to
* * * *
• She threw open the Euro-
pean Union’s gates to Middle
Eastern and African migrants,
a decision now seen as a di-
rect spur to Brexit, the rise of
anti-EU parties across the
Continent, even the election of
the anti-NATO, anti-EU admin-
istration of Donald Trump in
the U.S.
• She adopted “extend and
pretend” tactics for Europe’s
debt crisis, buying time for
Germany’s banks but leaving
indebted countries struggling
with stagnation and threaten-
ing to bring down Europe’s
common market and currency
system.
Mrs. Merkel’s spinning and
trimming, let’s be fair, has also
been extraordinarily success-
ful at keeping her in power,
the first job of any elected
politician. When it comes to
fixing any problem or setting
Europe on a productive path,
however, the record is incom-
plete but mainly suggests a
valiant effort to push off di-
saster onto somebody else’s
watch.
At some point, the incom-
ing Trump administration will
achieve a greater smoothness
in its consideration and im-
plementation of policy—un-
like the chaotic rollout of its
travel ban.
The opportunity before Mr.
Trump and the Republican
Congress, for a major overhaul
and rejuvenation of American
institutions in the direction of
a faster, more dynamic econ-
omy, remains in hand.
But the actual signs have
always been more ambiguous
and less encouraging than
many would like to believe.
for immigrants, but there are
two indications to the con-
trary. Over the weekend, for-
mer Trump adviser Rudy Giu-
liani told Fox News that after
Mr. Trump announced a “Mus-
lim ban” during the campaign,
the candidate came to him and
said “put a commission to-
gether, show me the right way
to do it legally.” Unsurpris-
ingly, Mr. Giuliani produced a
Muslim ban in drag.
Moreover, the language of
the executive order makes it
clear that after the temporary
suspension ends, non-Muslims
will receive preferential treat-
ment. The secretaries of state
and homeland security are di-
rected to give priority to refu-
gee claims made by individuals
citing religious persecution,
“provided that the religion of
the individual is a minority re-
ligion in the individual’s coun-
try of nationality.” For refu-
gees from many of the world’s
most dangerous places, this
excludes Muslims—including
Muslims from a Sunni-majority
country such as Syria, whose
government is dominated by a
Shiite minority.
Setting aside constitutional
issues, the executive order is
of dubious legality. The United
States’ fundamental immigra-
tion statute, the Immigration
and Nationality Act of 1965,
forbids discrimination in the
issuance of immigrant visas
based on an individual’s “race,
sex, nationality, place of birth
or place of residence.” On its
face, excluding potential immi-
grants from specific countries
violates the law.
consumers, such as flowers
with extended shelf life, pota-
toes that don’t bruise and ap-
ples that don’t turn brown
when sliced.
Bluejeans are another ex-
ample. Genetic engineers have
developed a way to produce
the two principal components,
cotton fabric and indigo dye,
for less money and soon will
make commercial bluejean
production cheaper than ever.
Genetically engineered cot-
ton is created by introducing
into the plant a new gene from
a bacterium called Bacillus
thuringiensis, or Bt. The bacte-
rial gene expresses a protein
that is toxic to certain insects
but not to humans or other
mammals. The concept isn’t
new: Live Bt bacteria, first ap-
proved in the U.S. in 1961, are
used by home gardeners and
commercial farmers and
boasts an admirable record of
safety and effectiveness.
Bt cotton helps farmers to
control major pests—the cotton
OPINION
One Merkel lesson is that rent-
seeking almost always takes
over. Her energy vision, what-
ever it might have been, is
now consumed by the demand
of wind farms and solar in-
stallers for subsidies, and the
clamor of politically-con-
nected businesses for exemp-
tions from the resulting high
electricity prices.
Amid Trump’s visa
storm, a German
reminder of what
bad policy looks like.
In the short weeks since
Mr. Trump was elected, the vi-
sion of clean, straight tax re-
form has gone out the window.
Instead of merely lowering or,
ideally, ending the corporate
rate, we may get a 20% bor-
der-adjustment tax to go along
with a 20% corporate income
tax. That is, two taxes instead
of one, which Congress can
immediately start peppering
with exemptions, exclusions
and deductions.
His promise of deregulation
for the auto industry in return
for job promises has been no-
tably scant on details of the
deregulation. A rationally “dis-
ruptive” president would seek
a legislative end to the 40-
year experiment in regulating
fuel consumption, phenome-
nally bureaucratic and ineffec-
tual. Here’s betting, when all
is said and done, Team Trump
will be satisfied with rejigger-
ing the rules to increase the
favoritism toward Detroit’s
In response, the Trump ad-
ministration points to a 1952
law that permits the president
to suspend the entry of any
class of aliens that he deter-
mines to be contrary to the na-
tional interest. But as the Cato
Institute’s David Bier observes,
the 1965 act modifies and re-
stricts the power, with excep-
tions only as provided by Con-
gress. As Justice Robert
Jackson observed: “When the
President takes measures in-
compatible with the . . . will of
Congress, his power is at its
lowest ebb.”
It probably violates
the Constitution and
statutes, and it’s
bad public policy.
Legal issues aside, the exec-
utive order does not meet the
test of sound public policy.
Refugees are already subject to
what Mr. Trump calls “extreme
vetting,” a process that lasts
anywhere from 18 months to
four years. This is why, as my
Brookings Institution colleague
Daniel Byman points out, “Syr-
ian refugees are linked to zero
terrorist attacks in the United
States.”
The order also punishes im-
migrants and refugees who fear
for their lives because they co-
operated with the U.S. armed
forces and other American enti-
ties. One of the individuals de-
tained at John F. Kennedy Inter-
national Airport had served as a
and pink bollworm and the to-
bacco budworm—which ac-
count for a quarter of all crop
destruction due to insects.
From 1996 through 2014, this
technology increased cotton
yields by an average of 17.3%,
according to a study by British
economists Peter Barfoot and
Graham Brookes.
Bt cotton is also environ-
mentally friendly. With con-
ventional cotton, farmers con-
trol insects by applying huge
amounts of chemical pesti-
cides known to harm birds,
fish and other aquatic organ-
isms. Lessening the need for
pesticides also reduces farm
workers’ exposure to those
chemicals.
The other main ingredient
in bluejeans, indigo dye, is
usually produced synthetically
through a complex, multistep
process performed with highly
toxic chemicals. It requires
special facilities and precau-
tions to protect workers and
the environment.
pickups and justify the large
investments of Tesla, GM and
others in electric vehicles.
Health-care reform already
may have been fatally under-
mined by the repeal circus—
repeal being an unnecessary
diversion and political show. It
would be quite a bit easier and
more efficient for Republicans
simply to graft their priorities
onto ObamaCare—first, by de-
regulating the “essential bene-
fits” list so insurers could de-
sign economical policies the
public would actually find
worth buying.
But those who noticed the
absence of the words “liberty”
and “freedom” in his inaugural
address identified the real
problem. Missing is any vision
of how America came to be
great in the first place.
Mr. Trump has ideas but
they are ankle-deep. His trans-
actional presidency may dis-
rupt for the purpose of dis-
rupting, but not clear yet is
whether it’s really leading
anywhere. Ronald Reagan cre-
ated a lasting legacy. In his
parting address to his staff, he
linked his vision of lower mar-
ginal tax rates and reduced
regulation to the eternal fight
against those seeking to drag
us a “mile or two more down
what Friedrich Hayek called
the road to serfdom.”
We didn’t start with Mrs.
Merkel by accident. For all his
faults, Mr. Trump’s election is
at least the biggest sign yet
that Western electorates have
figured out something has
gone wrong with the Western
economic model, even if they
are divided over exactly what
the trouble is.
translator for the U.S. Army and
as an engineer on U.S.-funded
reconstruction projects. Tar-
geted for assassination, first in
Baghdad and then in Kirkuk, he
applied for and received a spe-
cial immigrant visa based on a
determination that he had pro-
vided “faithful and valuable ser-
vice to the United States” and
was experiencing a serious
threat as a consequence of this
service.
If this is the thanks foreign
nationals can expect to re-
ceive, why would they ever co-
operate with the U.S.?
Along with injustice to indi-
viduals is the damage the or-
der inflicts on American for-
eign policy. Speaking for the
vast majority of policy experts
and former senior officials,
Richard Haass, the longtime
president of the Council on
Foreign Relations, says: “If
you’re ISIS, this is a good day.
This is a recruiting boon for
you. It . . . sends the message
‘The Americans are at war
with Islam,’ just as we—ISIS—
have been saying all along.”
Most troubling is the mes-
sage the executive order sends
about the current condition of
the United States. President
Trump would have us cower
fearfully behind a legal Magi-
not Line, animated by an illu-
sory quest for perfect security,
whatever the costs to our in-
terests and our principles. We
cannot be the “land of the
free” unless we are the “home
of the brave.” There’s a word
for the sentiments underlying
the president’s order, and it’s
not bravery.
But indigo dye can also be
made using genetically engi-
neered bacteria. This process
has fewer steps, uses water in-
stead of toxic organic solvents,
incorporates corn syrup as the
primary starting material, and
yields non-toxic waste prod-
ucts. While it is not yet effi-
cient enough for commercial
use, stay tuned.
Genetic engineering is a re-
finement of less-predictable
techniques that have been
used for centuries. It has al-
ready provided prodigious
benefits, both economic and
environmental. Instead of ac-
cepting critics’ unsubstanti-
ated claims, consumers should
be demanding its wider appli-
cation in agriculture and other
industries.
Dr. Miller, a physician and
molecular biologist, was the
founding director of the FDA’s
Office of Biotechnology and is
a research fellow at Stanford
University’s Hoover Institution.
Wednesday, February 1, 2017 | A15
BOOKSHELF | By Frank Rose
Confronting the
End of Privacy
Data for the People
By Andreas Weigend
(Basic, 299 pages, $27.99)
The Aisles Have Eyes
By Joseph Turow
(Yale, 331 pages, $30)
F
ifteen years ago, Steven Spielberg gave us one of the
most memorable images in 21st-century cinema: Tom
Cruise striding through a shopping center amid a ca-
cophony of electronic ads calling out to his character by
name. Some were smooth and purring: “Lexus. The road
you’re on, John Anderton, is the one less travelled.” Others
were blunt: “John Anderton! You could use a Guinness right
about now.” The movie was “Minority Report,” and though
the scene lasted barely a minute, it provoked a visceral re-
sponse in audiences. At the
time, targeted advertising
was a novelty, even online—
but it wasn’t hard to imagine
Google’s search ads ported to
the physical world and teth-
ered not just to a person’s in-
ternet queries but to his entire
identity. And what struck most
people as a nightmare sounded
to marketers, weirdly enough,
like an incredible opportunity.
Fast-forward to 2017. The fu-
ture Mr. Spielberg predicted is
fast approaching, and Joseph
Turow, a professor at the Univer-
sity of Pennsylvania’s Annenberg School
for Communication, finds it as irredeemably
creepy as moviegoers did in 2002. In “The Aisles Have Eyes:
How Retailers Track Your Shopping, Strip Your Privacy, and
Define Your Power,” Mr. Turow shows shopping today to be
an exercise in unwitting self-revelation—and not only online.
Carry a smartphone? Thanks to Wi-Fi, Bluetooth, download-
able apps and mobile wallets, it’s broadcasting your pres-
ence—and probably your name, email address, purchasing
history, social contacts and “likes” as well—to stores you walk
into or even pass by. Ads might not yet be calling out to you
by name, but they certainly know who you are and where.
The technology behind this is new, but the impulse isn’t. In
the pre-industrial era, Mr. Turow points out, merchants knew
their customers by name. Industrialization brought vastly
more customers but de-personalized the relationship. Depart-
ment store executives and supermarket managers weren’t
happy operating in the dark but had little choice. Then, in the
1970s, the barcode gave them a way to identify individual
buying patterns. In the ’90s, online “cookies” made it easy to
track people as they surfed the web. Now, with eight out of
ten U.S. adults and teens carrying a smartphone, retailers can
identify shoppers on the fly. Digital technology has trans-
formed the undifferentiated masses back into identifiable in-
dividuals, this time at scale.
We don’t want companies knowing too much
about us, but we kind of like the personalization.
In any case, we don’t know what to do about it.
Most of us are conflicted about this, Mr. Turow’s research
shows. We don’t want companies knowing too much about us,
but we do kind of like the personalization that results. We
have little idea what to do about it in any case. “The Aisles
Have Eyes” aspires to be a call to arms, but despite its “Twi-
light Zone” title, it’s hardly more readable than those online
user agreements we have little choice but to “accept.” An-
dreas Weigend’s “Data for the People: How to Make Our Post-
Privacy Economy Work for You” takes a different tack. Instead
of advocating for a 20th-century concept of privacy, Mr.
Weigend, the former chief scientist at Amazon, states bluntly
that we have entered a new era and challenges us to respond.
In a digital environment, we emit data as unthinkingly as
we breathe; anonymity is an illusion. Or as Mr. Weigend puts
it, playing off an iconic 1993 New Yorker cartoon, “On the in-
ternet, everybody knows you’re a dog.” So, what to do in this
post-privacy world—clean up your Facebook profile? It’s
never smart to advertise your college boozing experience to
employers, but don’t expect to hide much. People unwittingly
reveal key personality traits even when curating their image,
research shows, and Facebook’s face-recognition software—
somewhat disturbingly known as DeepFace—is sufficiently
advanced that your worst moments may turn up anyway in
someone else’s feed. And while the European Union’s top
court now insists on a “right to be forgotten” by search en-
gines, do you really want to rely on a bureaucratic mechanism
that cumbersome and arbitrary?
Or maybe we should demand “nanopayments” for the data
we generate, as Jaron Lanier proposed in his 2013 book “Who
Owns the Future?” That might impose a certain cost on com-
panies, but don’t go hoping for a windfall: Mr. Weigend calcu-
lates that, if Facebook gave back its entire profit to its users,
each would collect approximately $3.50 per year. We already
get far more than that, in the form of a website that keeps us
in constant touch with friends and relatives while magically
filtering out anything we don’t want to hear. The same value
proposition holds for Google and other “social data” refiner-
ies that offer services like information search and driving di-
rections—not for free but as part of a data exchange.
Few would dispute Mr. Weigend’s assertion that we’re at
a “hinge moment,” when the relationship between people
and their data will be defined for future generations. The au-
thor makes a strong case for what we need—the right to
amend or blur the data that pertains to us, the freedom to
experiment with it and take it with us to other sites and ser-
vices, and the ability to insist that data refineries be clear
about how they’re using our information. Unfortunately, he’s
better at enumerating these rights than at explaining how
we can assert them. At one point he advocates collective ac-
tion to force the data refineries to respond, but more often
he tries to skate by on we-the-people bromides. He’s too re-
alistic to expect data companies to grant access out of the
goodness of their silicon hearts, and he clearly views gov-
ernment regulation as a last resort. And of course it’s not
just the private sector that’s hoovering up information; gov-
ernments are doing the same, raising the all-too-real possi-
bility that post-privacy could mean post-freedom. But these,
apparently, are issues for another book.
Mr. Rose is the author of “The Art of Immersion: How the
Digital Generation Is Remaking Hollywood, Madison Avenue,
and the Way We Tell Stories” and a senior fellow at Colum-
bia University School of the Arts.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
A16 | Wednesday, February 1, 2017 * *** THE WALL STREET JOURNAL.

OPINION
REVIEW & OUTLOOK LETTERS TO THE EDITOR

Trump’s Good Justice Hey, Mexico Is a Neighbor, Partner and Friend

N
o one can replace Antonin Scalia on the ward the judicial doctrine known as “Chevron President Donald Trump has been real estate (just ask him) begins his
Supreme Court, but President Trump deference” that encourages the courts to defer busy, and he seems to be getting his presidency by picking a fight with one
threats all mixed up (“Trump Deepens of the largest and nearest U.S. trading
has made an excellent attempt by to an administrative agency’s rule-making. In
Rift With Mexico,” page one, Jan. 27). partners. Apparently brilliance at
nominating appellate Judge Gutierrez-Brizuela v. Lynch in Assuming he still reads the Journal, buying and building hotels doesn’t
Neil Gorsuch as the ninth Jus- Neil Gorsuch is an 2016, he wrote in a concur- here is a primer from one novice to mean he has a clue about interna-
tice. The polarized politics of originalist judge in rence that requiring courts to another. tional relations.
the Court guarantees a con- defer to executive agencies A 20% tariff on Mexican imports is a SALLY KING
firmation fight, but based on the Scalia mold. “seems no less than a judge- tax paid by Americans, not Mexico. So Washington
his record the 49-year-old made doctrine for the abdica- that doesn’t get Mexico to pay for the
judge is a distinguished tion of the judicial duty.” wall. The tariff idea still has its place, This so-called rift provides Mexico
choice who will adhere to the original meaning He added that “Chevron invests the power to but it is to punish American corpora- with an opportunity for self-reflection
of the Constitution. decide the meaning of the law, and to do so with tions for making a free choice on and public discourse on the future of
Judge Gorsuch is a leading light on the Tenth legislative policy goals in mind, in the very en- where they do their manufacturing. its own society. The elephant in Mexi-
A tax impound on remittances was can President Enrique Peña Nieto’s
Circuit Court of Appeals, where he was ap- tity charged with enforcing the law.” This judi-
your best idea to pay for the wall. It cabinet room is that it is an unnatural
pointed in 2006 by George W. Bush. He is well cial logic also has current relevance because the would extract money from impover- aberration for thousands, if not mil-
known in legal circles for his sharp prose, as well Obama Administration routinely invoked the ished Mexicans working in the U.S. lions, of Mexican citizens to leave their
as for his arguments for religious liberty and his Chevron doctrine to defend any regulation, no That would definitely pay for the native homes, cross the border into the
skepticism toward judicial doctrines that give matter how distant from the text of the statute wall, and maybe get some Mexicans U.S., and only then believe they have a
too much power to the administrative state. He being interpreted. to go home. chance to live happy and prosperous
is also noted for a Scalia-like approach to crimi- Judge Gorsuch has also displayed a crisp ap- Freezing Mexican assets to pay for lives. Mexico has natural resources, a
nal law that takes a dim view of vague statutes proach to cases attempting to discover ill-de- the wall is a creative idea you may not manageable climate, good geographic
that can entrap the innocent. fined constitutional rights. In a concurrence in have thought about. That could cap- location, abundant manpower, and it is
This paper trail is important, especially given 2016’s Cordova v. City of Albuquerque, he took ture assets really fast, but it might rooted in the institutions of Western
Mr. Trump’s relatively recent embrace of conser- issue with a plaintiff’s vague argument that he also get legally messy. You should con- civilization. So why does Mexico not
sult with a trusted adviser first, pref- have a society that induces its native
vative judicial principles. Every recent Republi- was the subject of a malicious prosecution. erably not the one who told you a tar- peoples to stay because opportunities
can President has disappointed supporters with “Ours is the job of interpreting the Constitu- iff would be a way to get Mexico to exist? It is not unreasonable for Presi-
at least one of his Supreme Court picks. Sandra tion,” he wrote. “And that document isn’t some pay for the wall. dent Trump to express sentiments that
Day O’Connor and Anthony Kennedy drifted left inkblot on which litigants may project their WILLIAM GOLDMAN many of today’s underlying problems
over the years as they were feted by Washington hopes and dreams for a new and perfected tort Palos Verdes Estates, Calif. lie squarely south of the border.
elites, while David Souter was a disaster from law, but a carefully drafted text judges are CHRIS J. KRISINGER
the start. charged with applying according to its original The best deal maker in commercial Burke Va.
Judge Gorsuch’s judicial record makes such public meaning.”
a transformation on the High Court unlikely. Mr. Trump nominated Judge Gorsuch from
When the Tenth Circuit heard Hobby Lobby v. the list of 21 potential nominees he released dur- Legislator, Prosecutor, Judge and Jury in One
Sebelius, a case that eventually went to the Su- ing the campaign, and his choice will be popular
In “When Is a Judge Not Really a biguous statutes. The aptly Orwellian
preme Court, Judge Gorsuch wrote a powerful among GOP voters of all stripes. The nomination Judge?” (op-ed, Jan. 24), David B. titled “America Invents Act,” which
concurrence supporting religious freedom and is also a chance for the White House to rebound Rivkin and Andrew M. Grossman created the Patent Trial and Appeals
the right of a company to opt out of ObamaCare’s from some of its early blunders. But it will also identify a potential reversal of the le- Board, is a great place to start.
contraception mandate based on conscience. be an acute and painful reminder for Democrats viathan administrative state by a re- SCOTT C. SANDER
While the religious convictions at issue may be of the price of Hillary Clinton’s defeat. turn of Congress and the courts as Pittsburgh
contestable or unpopular, Judge Gorsuch wrote, As qualified as he is, Judge Gorsuch ought to defenders of due process.
“no one disputes that they are sincerely held re- be confirmed at least as easily as President The case of SightSound Technolo- The SEC is only one example of a
ligious beliefs.” Obama’s appointees Elena Kagan and Sonia Soto- gies v. Apple shines a light on an- government agency with administra-
Once such sincere beliefs are demonstrated, mayor. But Democrats won’t forgive Republicans other opportunity to pull the pendu- tive law judges (ALJ). Over 30 fed-
he added, we know the Religious Freedom Resto- for declining to vote on Mr. Obama’s nomination lum back. SightSound’s historic firsts eral agencies now have their own
on the internet were chronicled in ALJs. With the combination of in-
ration Act applies. “The Act doesn’t just apply of Merrick Garland last year, though Democrats
this paper as far back as May 7, 1999 house judges and agencies like EPA,
to protect popular religious beliefs: it does per- would have done the same to a GOP nominee in (see “Two Entrepreneurs Try to Turn FCC, SEC and others doing their own
haps its most important work in protecting un- the last year of a presidential term. Net Patent Into a Blockbuster”). I am lawmaking and enforcement, we now
popular religious beliefs, vindicating this na- Republicans have a 52-seat Senate majority, one of the two entrepreneurs profiled live in an administrative state, not a
tion’s long-held aspiration to serve as a refuge and without some revelation the presumption in that piece, the other is the inven- constitutional republic. We seem to
of religious tolerance.” will be to confirm Judge Gorsuch. Democrats tor. We got patents to protect our in- have many agencies which have no
This defense of a core First Amendment right could attempt a filibuster, but then the GOP will novations. Those patents enabled us oversight from the executive, judicial
is especially important today when so many pro- have to be prepared to break it. Mr. Trump won to raise money and sell the world’s or legislative branches. The staff in
gressives want to subjugate religious practice to in major part because he promised to appoint first music and movie downloads. these agencies is not elected, seems
the will of the state. judges in Justice Scalia’s mold, and in Neil Gor- I never expected to learn terms hard to fire and has gradually shifted
like “Chevron deference” and “ultra to the left politically. Liberals and
Judge Gorsuch has also shown skepticism to- such it appears he has.
vires actions” but I did, the hard way. conservatives should be concerned
Apple went on to make billions and about these changes and be trying to

The Democrats’ Nominee Boycott our patents were invalidated by a tri-

bunal of three Patent Trial and Ap-
return to rule by constitutional law.
We have allowed some agencies to

O
peals Board judges whose ultra vires assume executive, legislative and ju-
regon Senator Ron Wyden indulged in a twice as long as both of Barack Obama’s HHS actions were deemed unreviewable dicial powers. The best chance to
Tuesday morning political tantrum, lead- secretaries—Kathleen Sebelius (16 days) and by the courts. change this will come from the legis-
ing fellow Democrats in a boycott of a Sylvia Burwell (17 days). Mr. Mnuchin has sub- The Regulatory Accountability Act lators controlling the purse for these
Senate Finance Committee mitted more than 4,400 docu- of 2017, which passed the House on agencies and by moving to return to
vote on two Trump cabinet If they can’t defeat ments, including tax returns Jan. 11, includes a provision that constitutional law.
nominees. If Mr. Wyden intends and a detailed questionnaire, could free courts from blind defer- MICHAEL P. CARTER, M.D.
to start a scorched-earth pro-
Trump’s cabinet, they and submitted to a marathon ence to agency interpretations of am- Savannah, Ga.
cedural war, he might consider won’t show up to vote. hearing. Mr. Wyden has al-
that his minority party has ready declared his intention to
more to lose. vote against both nominees, so
The boycott by all 12 committee Democrats the boycott stunt is aimed purely at dragging
She Was Struck By Terrorist Shell Fragments
temporarily denied Republicans a quorum to out the seating of Trump nominees. Regarding Bar- There is no ex-
vote to approve Health and Human Services nom- If Mr. Wyden is frustrated that he can’t block bara Smith’s cuse for physical
inee Tom Price and Treasury nominee Steve Messrs. Price and Mnuchin, he can blame his “Trump Foes assault in support
Mnuchin. Finance Chairman Orrin Hatch called own vote in 2013 to allow then Majority Leader Egged Me On to or opposition to
the move “the most pathetic thing” he’d wit- Harry Reid to blow up the Senate filibuster for Support Him” Donald Trump or
nessed in his time in the Senate, which is 40 cabinet and appellate court nominees. And if he (op-ed, Jan. 24): any other politi-
Progressives are cal figure. But the
years. Committee Democrats had agreed only the doesn’t want Republicans to follow that prece-
furious about a deplorable ac-
night before to hold the vote. Instead on Tuesday dent and eliminate the filibuster for Supreme Trump adminis- tions of a few
they staged a surprise press conference down the Court nominees, he might consider that nothing tration that alleg- that Ms. Smith
hall from the hearing room, complaining that will give nervous Republicans better cover for
ISTOCK

edly will tell peo- encountered were

they still had unanswered questions. doing so than partisan Democratic sabotage ple who are in
That’s a hoot. Rep. Price has at this point un- against every cabinet nominee as a new Presi- the U.S. illegally
dergone 35 days of committee vetting, which is dent tries to form a government. to go back to where they came from,
yet they yell the same offensive and
divisive words to strangers walking
Trump’s Iran Notice along streets in Washington. Psychol-
ogists call such incongruous senti-
not representa-
tive of those who
oppose President Trump. As she must
have noticed the next morning, the
hundreds of thousands who protested
Mr. Trump did so in an entirely calm,
civil and even cheerful manner.

O
ments “projections,” wherein one’s The assault, outrageous and mis-
ne early test for the Trump Administra- That meeting probably won’t yield much, own negative feelings are attributed guided as it was, resulted from her
tion will be how it enforces the nuclear thanks to the usual Russian obstruction, but it to others. One who hates haters logi- choice to associate herself with a can-
deal with Iran, and that question has will put a spotlight on the willingness of allies cally should suffer from a bit of self- didate and now president who,
become more urgent with such as Britain to do more to loathing, and if one isn’t completely through his behavior and rhetoric, has
Iran’s test last weekend of an- Tehran tests the new uphold an agreement the en- consumed by hate, there should be become a symbol of bigotry and mi-
other ballistic missile. President with another forcement mechanisms of some self-doubt and introspection. sogyny. Ms. Smith doubtless disap-
The test of a medium- which they were once eager to My guess is that there are many proves of those qualities but has de-
range, home-grown Khorram- ballistic missile launch. trumpet. Whatever happened millions of reluctant Donald Trump cided to overlook them.
shahr missile is Tehran’s to the “snapback economic supporters who during the last six DOUGLAS M. PARKER
twelfth since it signed the nu- sanctions” that were sup- months felt as if raw eggs were be- Ojai, Calif.
ing hurled at their heads by progres- Mr. Parker served in the White
clear deal with the U.S. and its diplomatic part- posed to be the West’s insurance policy against
sive friends or strangers and by pro- House Counsel’s Office during the
ners in 2015. John Kerry, then Secretary of Iran’s cheating? gressive media. The name-calling, Nixon administration and had some
State, insisted that the deal barred Iran from The Administration could also warn Iran that shouting and contempt for conserva- experience serving an unpopular presi-
developing or testing ballistic missiles. But that the Treasury Department will bar global banks tives didn’t fill us with love and dent, but was never pelted with eggs.
turned out to be a self-deception at best, as the from conducting dollar transactions with their unite us, an apparent shock to pro-
U.N. Security Council resolution merely “called Iranian counterparts in the event of another gressives that further infuriated
upon” Iran not to conduct such missile tests, test, and that it will rigorously enforce “know them. Pepper ...
rather than barring them. your customer” rules for foreign companies do- MATT JOHNSON
Iran has little reason to stop such tests be- ing business with counterparts in the Islamic Charlotte, N.C.
And Salt
cause the penalties for doing them have been Republic, many of which are fronts for the Rev- THE WALL STREET JOURNAL

so light. The Obama Administration responded olutionary Guards. CORRECTION

with weak sanctions on a few Iranian entities The U.S. needs to provide allies with military
and individuals, even as it insisted that Iran is reassurance against the Iranian threat. Supply- A Jan. 26 Sightings column, “The-
complying with the overall deal and deserves ing Israel with additional funds to develop its ater Finds a Home in Tinseltown,”
more sanctions relief. In December Boeing sophisticated Arrow III anti-ballistic missile suggested the screenplay for the
signed a $16 billion deal to sell 80 passenger system would send the right message, as would film “Fences” was revised by Tony
planes to Iran, never mind that the regime uses an offer to Saudi Arabia to sell Lockheed Mar- Kushner. While Mr. Kushner did re-
its airliners to ferry troops and materiel to tin’s high-altitude Thaad ABM system. The vise a script of “Fences,” according
proxies in Syria. State Department and Pentagon will have to ex- to Paramount it was not the one
President Trump has offered contradictory plore diplomatic and military options in case used in the movie.
opinions about that sale, but he has been un- the deal unravels.
equivocal in his opposition to what he calls the What the Administration can’t afford is to Letters intended for publication should
“disastrous” Iran deal. In a call Sunday with allow the latest test to pass without a response. be addressed to: The Editor, 1211 Avenue
of the Americas, New York, NY 10036,
Saudi Arabia’s King Salman, the President That would tell Iranians they can develop mis- or emailed to wsj.ltrs@wsj.com. Please
pledged to enforce the Iran deal “rigorously,” siles and threaten neighbors with impunity. Mr. include your city and state. All letters
and on Monday the Administration requested Trump is keen to show he will honor his cam- are subject to editing, and unpublished
an emergency Security Council meeting to dis- paign promises, and charting a tougher course letters can be neither acknowledged nor “Laugh all you want but it works
returned.
cuss the latest test. against Iran is one of them. the core and my back pain is gone.”
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
What Kind of a Judge Is Neil Gorsuch?
By David B. Rivkin Jr.
And Andrew M. Grossman
J
udge Neil Gorsuch, President
Trump’s nominee to succeed
Justice Antonin Scalia, is a
native Coloradan and avid
outdoorsman. He clerked for
a federal appellate judge and two Su-
preme Court justices and spent a de-
cade practicing law before his ap-
pointment in 2006, at age 39, to the
10th U.S. Circuit Court of Appeals. In
the decade since, he has written
some 850 opinions.
The way to take a judge’s measure
is to read his opinions, and so we set
out to review Judge Gorsuch’s. It was
not an arduous task, for his prose is
unusually engaging—think Scalia, with
He carefully follows
the law and writes as
engagingly as Scalia,
without the abrasiveness.
none of the abrasiveness. Justice Elena
Kagan has declared herself a fan of his
writing style. The only difficulty in
summarizing Judge Gorsuch’s output
is the compulsion to quote, at length,
from so many of his opinions.
One opens this way: “Haunted
houses may be full of ghosts, gob-
lins, and guillotines, but it’s their
more prosaic features that pose the
real danger. Tyler Hodges found
that out when an evening shift
working the ticket booth ended
with him plummeting down an ele-
vator shaft.” The case, by the way,
was a prosaic dispute between in-
What Will Trump’s Immigration Ban Actually Accomplish?
Can we stipulate
that President
Trump’s new policy
on refugees is prob-
lematic while also
stipulating that Ba-
rack Obama is chief
UPWARD
MOBILITY among those who
have no business
By Jason L.
criticizing it?
Riley
Mr. Obama is-
sued a statement
Monday expressing solidarity with
opponents of Mr. Trump’s executive
order—a rule aimed at addressing a
refugee mess created in large part
by Mr. Obama’s own foreign-policy
blunders. The last president prema-
turely withdrew American troops
from Iraq. He made an empty
threat that Syria’s Assad regime
would face “enormous conse-
quences” if it used chemical weap-
ons. These mistakes have damaged
American credibility and led to the
worst humanitarian crisis since
World War II.
One reason Mr. Trump won the
White House is that voters are anx-
ious about their personal safety.
Deadly terror attacks on civilians in
places like Paris, Brussels and San
Bernardino, Calif., have forced
many Americans to rethink the
A Recipe to Improve President Trump’s Intelligence Diet
By Michael Allen
D
on’t believe the hype: Trying
to reform the intelligence com-
munity is not akin to attacking
it. Americans should welcome the
news that the Trump administration
is considering reforms to the Office
of the Director of National Intelli-
gence, an important but beleaguered
agency in need of direction. Mr.
Trump’s director-designate, Dan
Coats, would be much better off lead-
ing an organization with a clear man-
date—and the strong backing of the
intelligence consumer in chief.
After the Central Intelligence
Agency was formed in 1947, its di-
rector became the nominal head of
the “intelligence community,” a con-
federation of intelligence offices
lodged in different departments and
agencies. Yet most intelligence
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surers. Another opinion starts:
“What began as a fight at a strip
club finds its way here as a clash
over hearsay.”
Judge Gorsuch shows a concern for
the people whose disputes are before
the court. Each opinion typically be-
gins with the name of the person
seeking relief and why. A recent ex-
ample: “After a bale of hay hit and in-
jured Miriam White while she was op-
erating her tractor, she sued the
manufacturer, Deere & Company.” Ms.
White’s appeal was summarily denied,
but even the brief, three-page opinion
reflects a serious engagement with
her arguments and the facts—in con-
trast with the boilerplate language
judges often use in such decisions.
Win or lose, parties appearing before
Judge Gorsuch surely know that they
have been treated with fairness, con-
sideration and respect.
These are not stylistic flourishes,
but central to how Judge Gorsuch
views the judicial role. “In our legal
order,” he has written, “judges distin-
guish themselves from politicians by
the oath they take to apply the law as
it is, not to reshape the law as they
wish it to be.” When a judge under-
stands that he has no authority to
legislate from the bench, cases that
might otherwise be hard become
straightforward exercises in applying
law to facts.
Thus, Judge Gorsuch could recog-
nize the “tragic circumstances” of a
family whose daughter had died in a
rafting accident, while still holding
that the liability release she had
signed was legally binding. That
Colorado allows people to assume
such risks, he explained, was a
choice for the state’s General As-
sembly, not the court.
longstanding open-door policies.
Groups like Islamic State, it seems,
can instigate or inspire acts of ter-
rorism when and where they
choose. Voters trusted Mr. Trump,
more than his opponent, to keep
the country safe.
The new executive order, which
temporarily bars new refugees as
well as travelers from seven coun-
tries with Muslim-majority popula-
tions, reflects this public mood. As
a candidate, Mr. Trump repeatedly
promised to enact strict vetting
measures to keep out potential Is-
lamic terrorists. After a man who
had pledged allegiance to ISIS
gunned down 49 people at a night-
club in Orlando, Fla., last June, Mr.
Trump once again called for a tem-
porary ban on Muslims entering the
country. Media outrage ensued, but
a poll taken at the time showed
that 48% of respondents sided with
Mr. Trump, while only 40% were
opposed.
The president is winning praise
from supporters for keeping a cam-
paign promise. Still, the nation de-
serves a less clumsy shift in border
policy and a more thorough expla-
nation of why these changes are
necessary. Mr. Trump has said his
order will make the country safer,
agencies saw the CIA’s role as only
symbolic. The CIA director was not
empowered in law to have real in-
fluence over other giant intelligence
organs like the National Security
Agency or the Defense Intelligence
Agency.
Then came Sept. 11. The chief fail-
ings that preceded the attack—the
inability to fuse CIA intelligence col-
lected abroad with FBI information
gathered at home, as well as delays
in placing suspected terrorists on
watch lists—were addressed by the
creation of a National Counterterror-
ism Center in 2004. But the same
year, the 9/11 Commission recom-
mended creating the director of na-
tional intelligence, and Congress
hastily followed that advice.
The 9/11 Commission posited
that the CIA couldn’t coordinate the
intelligence community because it
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OPINION
Judge Neil Gorsuch with President Trump Tuesday night.
In a similar dissent, Judge Gorsuch
argued for allowing a seventh-grader
who was arrested for horseplay in
gym class to sue the police officers,
reasoning that no New Mexico stat-
ute authorized the arrest. And he has
vigorously enforced rights of reli-
gious exercise under statutes like the
Religious Freedom Restoration Act,
deferring to Congress’s decision to
vindicate, as he put it, “this nation’s
long-held aspiration to serve as a ref-
uge of religious tolerance.”
Judge Gorsuch is among the judi-
ciary’s most consistent and adept
practitioners of textualism, the ap-
proach Scalia championed. In a me-
morial lecture last year, Judge Gor-
such said that “an assiduous focus on
text, structure, and history is essen-
tial to the proper exercise of the ju-
dicial function.” Textualism, he
added, serves to “confine the range
and border security can of course
always be improved, but what is
the value-added of the new mea-
sures? As even the White House ac-
knowledges, travelers from the
seven designated countries were al-
ready under extra scrutiny from the
previous administration.
Mr. Trump also hasn’t explained
whether the new policy would have
prevented recent attacks had it
been in place. Most terrorism in the
None of the attackers from
9/11 or San Bernardino
would have been thwarted
by the new rule.
U.S. is carried out by American citi-
zens. And “not a single American
has died as a result of terrorist at-
tacks committed by any citizen of
the seven banned countries in this
millennium,” explains Lyman Stone
in the Federalist. “Additionally,
countries whose citizens have per-
petrated attacks, like Pakistan or
Saudi Arabia, were not banned.”
The administration has invoked
both the San Bernardino shooting
was too busy with its core missions
of covert action and human intelli-
gence. The 9/11 Commission hoped
a director of national intelligence
would be a true leader, empowered
to set budgets, move money and
personnel to meet new threats, and
lead joint intelligence centers.
But the director of national intel-
ligence had only slightly more power
over the other 16 intelligence agen-
cies than the CIA previously had.
Meanwhile, Congress mandated that
the DNI be housed independently—
depriving it of a natural power base.
As the myth of a strong quarterback
flourished, Congress, the Bush ad-
ministration and even the Iraq Intel-
ligence Commission saddled the new
agency with dozens of stubborn
problems to solve. For example, it
was tasked with improving an anti-
quated security-clearance process
and fixing intelligence analysis after
Iraq. Successive directors of national
intelligence sought to bolster their
staff to cope with a daunting
agenda.
There is a profound mismatch be-
tween the responsibilities given to
the agency and the actual authori-
ties in law. The DNI has become a
Notable & Quotable: Travel Ban
From a Jan. 30 report by CBS
News:
BAGHDAD—Gen. Talib al Kenani
commands the elite American-
trained counter terrorist forces that
have been leading the fight against
ISIS for two years.
“I’m a four star general, and I’m
banned from entering the U.S.?” he
said.
His family was relocated to the
Wednesday, February 1, 2017 | A17
ASSOCIATED PRESS
of possible outcomes and provide a
remarkably stable and predictable
set of rules people are able to fol-
low.” On the other hand, attempting
to divine legislative intent, as he
wrote in one opinion, is a “notori-
ously doubtful business.” Another
opinion decried the judicial “conjur-
ing” that substitutes the court’s view
of optimal policy for Congress’s.
In an influential 2015 decision,
Judge Gorsuch excavated the mean-
ing of a law increasing penalties on
anyone who “uses” a gun “during and
in relation to” a drug offense. He
carefully employed “plain old grade
school grammar”—including a sen-
tence diagram.
Judge Gorsuch’s textualism ex-
tends to the Constitution, quite em-
phatically: “That document,” he
wrote, “isn’t some inkblot on which
litigants may project their hopes and
rampage and 9/11 in rolling out the
new policy. But neither of the San
Bernardino shooters would have
been affected by the new restric-
tions. And the 9/11 hijackers hailed
from Egypt, Lebanon, Saudi Arabia
and the United Arab Emirates—all
Muslim-majority countries that
were excluded from the executive
order.
Mr. Trump has also cited Eu-
rope’s refugee problem as a cau-
tionary tale, and it’s indisputable
that some European countries have
done a poor job of screening people
who arrived at the border seeking
asylum. However, the ringleader of
the 2015 Paris attack that claimed
130 lives was a Belgian national,
and nearly all of the others in-
volved were born in the European
Union and held EU passports that
allowed them to travel freely. By
the Trump administration’s logic,
shouldn’t European nations also be
included in the ban?
One of the more valid concerns
with Mr. Trump’s executive order is
that it may give Americans a false
sense of security and further com-
plicate our relationship with Mus-
lim allies. Travel bans have their
uses, and it’s common sense that
some foreigners will be screened
mere coordinator of bureaucratic
positions, required to seek permis-
sion and maintaining only indirect
control over funding.
Despite the hurdles, the agency
has achieved some success. The DNI
has provided strategic direction to
the intelligence community’s dispa-
rate agencies to confront shared
If the White House
wants better information,
it should give the spy
community a true leader.
challenges that individual agencies
are unwilling or unable to tackle
alone. Think cost-saving on common
information technology or policies to
facilitate information sharing. In
2008, the DNI led the effort to mod-
ernize the Foreign Intelligence Sur-
veillance Act. Faced with sharply de-
clining budgets in recent years, the
office mitigated automatic cuts to
personnel, research and development,
and cyber capabilities. The DNI prior-
itized balancing the preservation of
U.S. for their safety, and he’d had
plans to see them next week, until
he was told not to bother.
“I have been fighting terrorism
for 13 years and winning,” he said.
“Now my kids are now asking if I’m
a terrorist?” . . .
“This ban needs to be reviewed,”
Kenani said. “We thought we were
partners with our American friends,
and now we realize that we’re just
considered terrorists.”
dreams for a new and perfected tort
law, but a carefully drafted text
judges are charged with applying ac-
cording to its original public mean-
ing.” Looking to the “original public
meaning” of the Fourth Amendment,
for example, Judge Gorsuch has re-
jected the government’s view that a
search warrant could be applied
across jurisdictional lines. He also
disputed its claim that police officers
may ignore “No Trespassing” signs to
invade a homeowner’s property with-
out a warrant.
What about the Constitution’s
separation of powers, intended to
safeguard liberty? Judge Gorsuch
has been at the vanguard of apply-
ing originalism to the questions
raised by today’s Leviathan state,
which is increasingly controlled by
unaccountable executive agencies.
These questions loom large after
the rash of executive actions by
President Obama, and now the
whiplash reversals by the Trump
administration.
The deference that judges now
must give to agencies’ interpretations
of the law, he wrote in an opinion last
year, permits the executive “to swal-
low huge amounts of core judicial
and legislative power and concen-
trate federal power in a way that
seems more than a little difficult to
square with the Constitution of the
framers’ design.”
Judge Gorsuch added: “Maybe the
time has come to face the behemoth.”
His addition to the Supreme Court
would give the justices a better
chance than ever to do precisely that.
Messrs. Rivkin and Grossman prac-
tice appellate and constitutional law
with Baker & Hostetler in Washington.
more rigorously than others be-
cause resources are limited. But the
policy makers who spend their time
thinking about how to safeguard
the country express equal or
greater concern about homegrown
threats—the radicalization of peo-
ple already living here, not just
those trying to get in.
Here again, Mr. Trump is inherit-
ing not only a bad situation but one
that was allowed to fester on his
predecessor’s watch. “The U.S. gov-
ernment lacks a national strategy
for combating terrorist travel and
has not produced one in nearly a
decade,” according to a comprehen-
sive 2015 analysis by the House
Committee on Homeland Security.
“The unprecedented speed at which
Americans are being radicalized by
violent extremists is straining fed-
eral law enforcement’s ability to
monitor and intercept suspects.”
The report concluded: “Ultimately,
severing today’s foreign-fighter
flows depends on eliminating the
problem at the source in Syria and
Iraq.”
Mr. Obama’s commitment to
rooting out ISIS was little more
than rhetorical. We’ll find out if Mr.
Trump’s goes beyond issuing travel
bans.
current capabilities against future in-
vestments.
Although there has never been a
president quite like Mr. Trump, it’s
normal for a new president to seek
intelligence-community reforms. One
of George W. Bush’s first acts in of-
fice was to order two competing re-
views of the management of intelli-
gence. They followed dozens of
similar reports ordered by other
presidents. Now it’s time for another
review: The U.S. has been operating
under the current system for over 12
years, and criticism has rarely gone
beyond the conventional wisdom of
“bloated bureaucracy.”
The coming review should be
guided by what has happened since
9/11. Did the U.S. truly create an all-
powerful “spymaster” equipped to
remake the intelligence for a new
era and new enemies? The Trump
administration should consider the
enormous to-do list foisted upon the
director of national intelligence and
ask how he could make decisive
progress.
The U.S. is dealing with worsen-
ing national-security threats, a de-
mocratization of dangerous technol-
ogies, and serious cyber attacks.
Worse, the intelligence community
has been accused of politicizing in-
telligence gathering. Mr. Trump
should complete a swift, top-down
review of the intelligence commu-
nity. Once finished, the president
can set clear priorities for Mr. Coats
and offer unwavering support as he
pursues his agenda.
Mr. Allen, a former congressional
and White House national-security
staffer, is managing director of Bea-
con Global Strategies and author of
“Blinking Red: Crisis and Compro-
mise in American Intelligence after
9/11” (Potomac, 2013).
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
A18 | Wednesday, February 1, 2017 THE WALL STREET JOURNAL.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
BUSINESS & FINANCE
© 2017 Dow Jones & Company. All Rights Reserved.
S&P 2278.87 g 0.09% S&P FIN g 0.68%
Exxon Takes a $2 Billion Charge
Oil slump results
in lowest annual profit
in 20 years; company
dogged by SEC probe
BY BRADLEY OLSON
Exxon Mobil Corp. said
Tuesday it wrote down the
value of more than $2 billion
in U.S. assets, departing from
decadeslong practice amid an
investigation by securities reg-
ulators, as the world’s largest
publicly traded oil company
posted its lowest yearly earn-
ings in 20 years.
Toshiba
Shrinks
Nuclear
Ambitions
BY RUSSELL GOLD
AND TAKASHI MOCHIZUKI
Toshiba Corp. plans to stop
building nuclear power plants
after incurring billions of dol-
lars in losses trying to com-
plete long-delayed projects in
the U.S., a move that could
have widespread ramifications
for the future of the nuclear-
power industry.
The Japanese industrial con-
glomerate is set to announce
plans to exit from nuclear con-
struction by the middle of Feb-
ruary, according to a Toshiba
executive familiar with the
matter. The executive also said
Toshiba’s chairman, Shigenori
Shiga, and Danny Roderick, a
Toshiba executive and the for-
mer head of its Pittsburgh-
based nuclear power
unit, Westinghouse Electric
Co., are expected to step down.
Toshiba’s decision deals a fa-
tal blow to its ambitions to be-
come a major player in the nu-
clear construction business.
The company has bet aggres-
sively on Westinghouse’s
AP1000 reactor design, which it
hoped would anchor a new gen-
eration of nuclear power plants
that were supposed to be easier
to build and to deliver on time.
But signs emerged that the
AP1000 wasn’t as easy to build
as hoped, and yet Toshiba re-
mained confident and took on
added financial risk, according
to legal filings and interviews
with people involved with the
construction process.
Toshiba declined to com-
ment. The company previously
said it would disclose the size
of Westinghouse’s losses
on Feb. 14. In December, it said
it was likely to take a write-
down of several billion dollars,
and people familiar with the
situation say the losses could
approach $6 billion—plunging
the company into a new crisis
just as it was seeking to move
away from an earlier account-
ing scandal.
Westinghouse will continue
to design nuclear reactors, the
Toshiba executive said, and is
expected to complete construc-
tion work at two U.S. nuclear
facilities it is still in the process
of building—in Georgia and
South Carolina, commissioned
by utilities Southern Co. and
Scana Corp., respectively.
Toshiba’s future involvement
with nuclear plants will be lim-
ited to selling its designs; it will
let other companies handle the
risk of building the facilities, an
approach it already takes in
China.
“We are closely monitoring
[Westinghouse’s] financial sta-
tus, as well as that of Toshiba,”
a Scana spokeswoman said.
Southern officials said they
are confident shareholders and
customers are protected
through a $920 million letter of
credit from Westinghouse and a
fixed-price contract which
transfers responsibility for cost
overruns to Westinghouse.
In October 2015, as Toshiba
faced a very public accounting
scandal centered on its com-
puter business, it was quietly
dealing with another crisis in
nuclear power-plant construc-
Please see TOSHIBA page B2
TECHNOLOGY: NINTENDO WANTS MORE FROM MARIO B4
* * * *
S&P IT g 0.61%
The move follows an inves-
tigation begun by the U.S. Se-
curities and Exchange Com-
mission in August over
Exxon’s accounting practices
and how the company values
its future oil and gas wells, or
reserves. The probe also
sought information about how
Exxon weighs the potential
impact that climate-change
regulations could have on its
business, The Wall Street
Journal reported in October.
An SEC spokesman declined
to comment Tuesday. Exxon
has said it is cooperating with
the probe and that its finan-
cial reporting meets all legal
President Trump wants more medicines sold in the U.S. to be made in the country. Above, a pharmacist in Saginaw, Mich., last year.
More Headaches for Drugmakers
BY PETER LOFTUS
AND PREETIKA RANA
The U.S. pharmaceutical in-
dustry has been under pres-
sure over high and rising drug
prices. Now after criticism
from the White House, it’s
feeling the heat for where it
makes its products, too
“I want you to manufacture
in the United States,” Presi-
dent Donald Trump told sev-
eral pharmaceutical CEOs at a
White House meeting Tuesday,
where he also attacked “astro-
nomical” pharmaceutical pric-
ing.
Mr. Trump’s latest call to
bring drug manufacturing back
to the U.S. echoed comments
he made shortly before his in-
auguration. “We have to get
our drug industry coming
back,” he said in a press con-
ference. “They supply our
drugs, but they don’t make
them here, to a large extent.”
A majority, roughly 60%, of
finished medicines sold in the
U.S. are made in the country,
according to the Food and
Drug Administration. But im-
INSIDE
ITALY RETAINS
ALLURE
FOR INVESTORS
PROPERTY REPORT, B8
ARCONIC TAKES
FIRE FROM
ACTIVIST
MANAGEMENT, B3
THE WALL STREET JOURNAL.
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and accounting standards.
Irving, Texas-based Exxon
reported a 40% drop in fourth-
quarter earnings, as low oil
and natural-gas prices also
took a toll. Annual 2016 profit
totaled $7.8 billion—Exxon’s
lowest since 1996, three years
before the company grew im-
mensely with an $82 billion
deal to buy rival Mobil Corp.
Exxon was alone among
major energy companies in not
having recognized on its books
any reduction in the value of
its reserves, a development
that had become fairly routine
for peers as prices crashed in
recent years. Since 2014, other
Drug Influx
Pharmaceutical imports to the U.S. have more than doubled in the past
decade, as U.S. and non-U.S. companies supply the market from overseas.
Pharmaceutical imports
$80 billion
60
40
20
0 India
2005 ’10
Sources: World Trade Organization; Commerce Dept.
ports have more than doubled
in recent years. The U.S. is
now the world’s biggest im-
porter of pharmaceuticals, ac-
cording to the Department of
Commerce, with imports of
$86 billion in 2015, compared
with $39 billion in 2005.
In the meeting Tuesday, Mr.
Trump offered carrots as well
as sticks. He said he aims to
‘Diva of Distressed’ Stresses Workers
BY PEG BRICKLEY
Eric Dopart was on his
break this past spring at
Duro Textiles in Fall River,
Mass., when the buzzers be-
gan sounding, signaling
power had failed to the ov-
ens that dried dyed fabrics.
The maintenance mechanic
went to investigate. Nothing
was wrong with the equip-
ment, but outside he found
the gas company shutting off
service to the mill, managed
by Lynn Tilton’s Patriarch
Partners LLC investment
firm. That was when Mr. Dop-
art realized the company
wasn’t paying its bills.
A few months later, Duro
shut down. Ms. Tilton,
known as the “Diva of Dis-
tressed” for her investments
in troubled businesses, didn’t
provide an explanation to the
company’s roughly 157 work-
ers, he said.
“She left everybody high
and dry. Just closed the doors,”
said Mr. Dopart, president of
the Unite Here local union that
LIBOR 3M 1.035
U.S. companies have slashed
the value of their assets by
more than $200 billion, ac-
cording to S&P Global Market
Intelligence.
“The impairment appears a
bit light given the company’s
resources,” said Brian Young-
berg, an energy analyst with
Edward Jones in St. Louis.
Exxon shares fell 1.1% to
$83.89 on Tuesday, while
peers such as Royal Dutch
Shell PLC either rose or held
roughly flat.
Exxon wrote down natural-
gas assets in the Rocky Moun-
tains. The company purchased
shale producer XTO Energy for
Imports by country
Others Ireland $15.2B
$34.9B
Germany
$14.5B
2015
$86B
Israel Switzerland
’15 $6 $6 $9.4B
THE WALL STREET JOURNAL.
reduce regulations and taxes
to encourage more domestic
drug manufacturing.
“We would be able to bring
jobs back to the U.S. if there
was a tax change,” Pfizer Inc.
Chief Executive Ian Read in an
interview Tuesday. Mr. Read
didn’t attend the White House
meeting because the company
reported earnings Tuesday.
JESSE BURKE FOR THE WALL STREET JOURNAL
Former employees of Duro Textiles in Fall River, Mass., stand in front of the now-closed factory.
represented workers in Duro’s
printing plant. “There were
people in their 60s. Where are
they going to get a new job?”
Duro’s shutdown was a
“horror show,” said Rene
Rondeau, president of the
Wednesday, February 1, 2017 | B1
NIKKEI (Midday) 19040.74 0.00% See more at WSJMarkets.com
IPO Gives
Blackstone
$31 billion in 2010 during the
heart of a drilling boom that
would send natural-gas prices
careening downward within a
Housing
few years. The price, which av-
eraged $5.35 per million Brit-
ish thermal units when the
Bet a Push
deal was announced late in BY CORRIE DRIEBUSCH
2009, is now about $3.23. AND RYAN DEZEMBER
The SEC investigation ini-
tially sprung out of a separate Blackstone Group LP took
examination begun in late a step toward cashing in its
2015 by New York Attorney big bet on housing Tuesday.
General Eric Schneiderman The private-equity giant’s
into Exxon’s history of advo- Invitation Homes Inc. raised
cacy about global warming $1.54 billion in its initial pub-
and how the company has lic offering late Tuesday, ac-
communicated with its inves- cording to two people familiar
Please see EXXON page B2 with the deal. The real-estate
investment trust sold 77 mil-
lion shares at $20 apiece in its
IPO, according to the people,
making it the largest U.S.-
listed IPO in more than a year.
Invitation Homes is the end
result of the biggest homebuy-
ing spree in history. Starting
in 2012 with a home in Phoe-
nix, Blackstone spent some
$10 billion buying and fixing
up homes to rent. For
stretches, the firm spent $150
million a week on foreclosed
homes, often buying them
sight unseen.
The company now owns
and rents 48,431 houses in 13
markets, from Seattle to south
Florida, according to Invita-
tion’s offering document.
Blackstone Group didn’t plan
to sell any of its roughly 70%
stake in the IPO, the filing
JOSIE NORRIS/ASSOCIATED PRESS
said, but the listing will enable
it to begin cashing out of its
investment in the future.
The IPO is also a test of in-
vestors’ interest in the rental-
home business.
Invitation is part of a
broader bet on Wall Street
that homeownership will re-
main out of reach for many
Americans. Invitation will join
its two largest rental-home ri-
vals on the stock market.
Shares of American Homes 4
In remarks during the meet- Rent and Colony Starwood
ing aired on television, Eli Lilly Homes debuted in recent years
& Co. CEO David Ricks told to tepid demand but surged
President Trump that Lilly’s last year as the homeowner-
home state of Indiana is ship rate fell to its lowest level
“where we make a lot of our in at least 50 years, according
products. We’re hiring for to U.S. Census Bureau data.
manufacturing jobs as I Homeownership has de-
speak.” Merck & Co. CEO Ken clined since the housing crisis
Frazier said: “We have a tre- amid stricter lending stan-
mendous number of high-pay- dards, mounting student debt
ing, skilled jobs including man- and potential buyers whose
ufacturing jobs in the U.S.” savings and credit diminished
Since the 1980s, U.S. drug- during the recession.
makers have built up consider- But some investors have
able manufacturing capacity in questioned whether the
countries such as Ireland, In- growth of Invitation and its ri-
dia, Singapore and China to vals will be limited now that
capitalize on tax and labor- the foreclosure crisis is over
cost advantages—while closing and home prices in many mar-
many domestic plants. kets have exceeded their 2006
The FDA also has estimated highs.
that 80% of active pharmaceu- Last week, Invitation won
tical ingredients—the main an important endorsement
components used to make from Fannie Mae when the
drugs—are now made outside government-controlled mort-
the country. Antibiotics sold in gage-finance company said it
the U.S. are made almost en- would guarantee as much as
tirely from ingredients sourced $1 billion of the company’s
Please see DRUGS page B2 debt, a development that will
likely mean cheaper borrowing
 Heard on the Street: Pharma’s costs for Invitation and poten-
woe is far from over............ B16 tially its rivals.
union local that represented
workers in Duro’s fabric-fin-
jobs. Ms. Tilton’s empire that
year was roiled by a flurry of
ishing operation. lawsuits as well as civil-fraud al-
Duro is one of at least three
Patriarch-managed companies
legations leveled by the Securi-
ties and Exchange Commission.
to abruptly close in 2016, to- In a statement, a represen-
gether costing around 2,000 Please see TILTON page B14
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
B2 | Wednesday, February 1, 2017
INDEX TO BUSINESSES
These indexes cite notable references to most parent companies and businesspeople
in today’s edition. Articles on regional page inserts aren’t cited in these indexes.
A Enterprise Products
AbbVie.........................B2
Adidas ......................... B3
Aetna...........................B5
Alcoa......................A2,B3
Alibaba Group.............B3
Alphabet .............. B4,B15
Amazon.com ............... B4
AmerisourceBergen..B16
Apple
.........A1,A10,B4,B15,B16
Arconic...................A2,B3
B
Bank of America.........B9
Betterment ................. B9
BG Group.....................B2
Blackstone Group ....... B1
Brevan Howard.........B14
C Harley-Davidson ......... B5
Calvin Klein...............A11
Caterpillar ................... B5
CBRE Group.................B8
Charles Schwab .......... B9
Chevron ....................... B2
Chicago Bridge & Iron B2
Chrysaor Holdings ...... B2
Coima...........................B8
Cushman & WakefieldB8
D Matrix Laboratories....B2
Dell Technologies........B4
Deutsche Bank..........B14
E Microsoft ............. B4,B15
84 Lumber...................B6
Eli Lilly ......................B16
Elliott Management ... B3
Enbridge......................A2
INDEX TO PEOPLE
A Huber, Lars..................B8
Abney, David...............B3
Anderson, Tom..........B15
B K
Bartlett, John...........B15
Bergman, David..........B3
Bertolini, Mark T. ....... B5
C Koutsoftas, Nick.......B16
Carlinsky, Michael .... B14
Carpaneda, Nicolò.....B15
Chan, Dennis.............A12
Cook, Tim....................A1
D Musk, Elon..................B4
Dalmiglio, Davide........B8
Dell, Michael...............B4
F O
Fitzpatrick, Dawn.....B14
Frazier, Ken.................B1
Friedman, Adena.......B14
G-H
Greifeld, Bob.............B14
Guttman, Tim ........... B16
Haberkorn, Bob.........B16
TOSHIBA
Continued from the prior page
tion—and made a series of bold
moves in an attempt to fix it.
The company bought out a
partner in a nuclear-construc-
tion consortium, settled law-
suits and renegotiated con-
tracts with Southern and
Scana, which put Toshiba over-
whelmingly on the hook if the
two construction projects con-
tinued to run over budget.
Toshiba’s decision to exit
from the nuclear construction
business could have widespread
ramifications. Nuclear power
appears to be “too big, too ex-
pensive, and most of all, too
slow to compete effectively in
what is an increasingly fero-
cious competition,” said Mycle
Schneider, a nuclear expert
based in Paris.
The nuclear construction
business, led by a General Elec-
tric Co.-Hitachi Ltd. venture
and France’s Areva SA, has
been under pressure since the
2011 Fukushima nuclear-plant
meltdowns in Japan.
Toshiba plunged into the
business in 2006, when it won
a bidding war to acquire West-
inghouse. Analysts worried at
the time that it had overbid.
But within a couple of years the
bet appeared to be paying off:
Southern chose Westinghouse’s
design for the first new nuclear
plant to be built in the U.S. in
30 years, and the next month
Scana also chose the AP1000
for a plant in South Carolina.
The U.S. government ap-
proved the designs in early
2012 and work began. Within a
few months, legal disputes
arose between Westinghouse,
its construction consortium
partner, Stone & Webster, and
Southern over who would pay
for unexpected costs resulting
from post-Fukushima tougher
safety standards, according to
filings.
Relations between Westing-
house and Stone & Webster’s
owner, Chicago Bridge & Iron
NV, broke down by 2015, ac-
cording to filings. William Ja-
cobs, the independent con-
struction monitor for the plant
Southern is building, said West-
inghouse and CB&I were “in-
curring very large costs beyond
those being publicly reported”
due in part to having so many
employees for a project that
was years behind schedule.
In March 2015, CB&I
broached a possible sale of
Stone & Webster to Toshiba. As
the talks intensified, Toshiba
became mired in the account-
ing scandal, prompting it to ac-
knowledge it padded profits in
* **** THE WALL STREET JOURNAL.
BUSINESS & FINANCE
News Corp...................B5
Partners....................A2 Nike......................B3,B16
Ernst & Young.............B6 Nintendo......................B4
Expedia........................B4 Noble Group................B2
Exxon Mobil.........B1,B15 Novo Nordisk............B16
F P
Facebook....................B15 Patriarch Partners......B1
FedEx...........................B3 Pfizer...........................B1
Fidelity Investments..B9 R
Frog Design.................B6
Royal Dutch Shell..B1,B2
G Rubicon Fund
General Electric .......... B6 Management...........B14
Goldman Sachs Group S
...................................B15 Sanofi........................B16
ANDREW HARRER/BLOOMBERG NEWS
Google ......................... B4
Soros Fund
H Management...........B14
Harbour Energy...........B2 Sprint .......................... B5
T
Hennes & Mauritz......B3 Target..........................B9
Hines ........................... B8 Tesla Motors...............B4
Humana.......................B5 Toshiba........................B1
I U
Inditex.........................B3 UBS Group.................B14
Invitation Homes........B1 Under Armour
M ...................... B3,B15,B16 Merck CEO Ken Frazier, flanked by other drug industry executives, following a meeting at the White House on Tuesday.
DRUGS
Marimekko..................B6 UniCredit.....................B8
Mastercard................B14 United Parcel Service a director at Ernst & Young nology drugs including its top noted that the majority of its
............................. B3,B15 LLP’s health-care practice in seller, arthritis treatment Hu- manufacturing workers are in
McDonald's................B16 V Singapore. mira. The combined cost of the the U.S., where it has 14 plants
Merck...................B1,B16 Vanguard Group..........B9 “I think this is something projects is $320 million. in 11 states. Last year, the com-
Visa............................B14 Continued from the prior page the industry needs to pay at- An AbbVie spokeswoman pany began building a new one
Morgan Stanley..........B9 W from China and India, for ex- tention to, in light of its poten- said the plants—which haven’t in Andover, Mass. The plant will
Mylan...........................B2 ample. tial impact on the cost of man- begun supplying products to be used in part for biotech
Wealthfront ................ B9
N Westinghouse Electric It isn’t just U.S. pharmaceu- ufacturing,” said John Taylor, the market—will meet growing products, a rapidly emerging
Nasdaq ...................... B14 .....................................B1 tical firms that import prod- a former FDA official and global demand for products, segment of the industry concen-
ucts; European and Asian com- pharmaceutical executive who adding that the company has a trated in the U.S. and Europe.
panies supply drugs and
ingredients to the U.S., too.
While offering the induce-
now advises the industry on
compliance and regulatory af-
fairs with Greenleaf Health Inc.
“balanced network” of plants
in the U.S. and abroad.
New York-based Pfizer said
American drugmakers have
also acquired facilities in Asia,
where manufacturing costs can
Riley, Will..................B16 ments of less regulation and The auto industry is already be 80% lower than in the U.S.
Hund-Mejean, Martina Roderick, Danny..........B1 lower taxes, Mr. Trump has dealing with disruption at the For example, in 2007, generic-
...................................B14 Rondeau, Rene............B1 also threatened to pursue a hands of the new administra- drugs maker Mylan NV ac-
S “very major” border tax on tion. Under withering attacks
A number of U.S. quired India’s Matrix Labora-
Kelley, Kathleen........B16 Sanders, Bernie........B16 companies moving operations from Mr. Trump, car makers drugmakers are in the tories Ltd., transforming itself
Kimishima, Tatsumi ... B4 Shiga, Shigenori ......... B1 overseas. And Republicans in are rethinking plans to pro- into one of the world’s biggest
Korapaty, Praveen .... B15 Simons, Raf..............A11 Congress have proposed legis- duce cars abroad, particularly
process of building makers of active pharmaceuti-
Slemp, Cal...................B9 lation that would effectively in Mexico, for sale in the U.S. plants overseas cal ingredients.
M Stein, Jon....................B9
increase taxes on imported Several U.S. drugmakers are Half of Mylan’s workforce is
Mignanelli, Andrea.....B8 T goods while favoring exports. in the process of building now based in India, as are 25
Milstein, Larry..........B15 Thakar, Sumedh..........B9 But any increased taxation on plants overseas or have re- out of its 40 manufacturing fa-
Molloy, Chip................B3 Thomsen, Marie Owens pharmaceuticals could under- cently done so. Not all of it is in June it will spend $350 mil- cilities. All the active ingredi-
...................................B15
mine another of Mr. Trump’s for U.S.-bound products; some lion to build a plant in Hang- ents Mylan supplies to drug
N Tillerson, Rex..............B2
stated objectives: reducing of the new manufacturing ca- zhou, China, to make copycat companies around the world
Tilton, Lynn.................B1
Nia, Mahbod................B8 drug prices. pacity is meeting rising de- versions of biotech drugs, with are made in India.
Toto, Serkan................B4
Tromp, Jos .................. B8 A crackdown on overseas mand in other countries. construction expected to be In an emailed statement, a
O'Connor, Paul .......... B15 W manufacturing of pharmaceu- AbbVie Inc., of North Chi- completed next year. The Mylan spokeswoman didn’t
P-R ticals would “cause great dis- cago, Ill., finished work on one plant’s initial focus will be to offer comment on overseas
Woods, Darren............B2
Persson, Karl-Johan ... B3 ruption to the health-care sys- plant in Singapore in Septem- supply the Chinese market but manufacturing, rather noting
Y tem in the U.S. and directly ber to make certain drug in- Pfizer said it could eventually that “on the finished-dose side
Pickart, John.............B16
Youngberg, Brian........B1 drive up costs,” said Jeff Wei- gredients, and is building an- be a global supplier. we manufacture in the U.S.
Pinedo, Jodi.................B9
Plank, Kevin................B3 Z sel, who has worked in Asia other plant on the same site to Pfizer said it has 49 manu- about 80% of what we sell in
Read, Ian.....................B1 Zuckerberg, Mark ..... B15 for drug companies and is now make components for biotech- facturing plants abroad, but the U.S.”
its personal-computer and
other businesses.
Toshiba worried that if the
lawsuits with Southern and
EXXON Shell Attacks Debt
With North Sea Sale
looned to $78 billion at the
end of the third quarter.
The sales announced on
make it hard to do deals.
Last year, Shell fell short of
its sales goal of $6 billion to $8
CB&I over the Fukushima-re- Continued from the prior page Tuesday included a deal worth billion but has now reached
lated safety-cost overruns con- tors on the matter. Exxon, up to $3.8 billion for much of deals worth about $11 billion
tinued, Toshiba might have had which has denied wrongdoing LONDON—Royal Dutch Shell’s British North Sea assets overall.
to acknowledge that Westing- and characterized that probe Shell PLC capped off a flurry of to Chrysaor Holdings Ltd.—an oil The North Sea sale stands
house faced big liabilities, ac- as politically motivated, sub- deals in January with sales in company backed by Harbour out for its size, the largest deal
cording to company execu- mitted more than 1 million Thailand and the North Sea Energy Ltd., an investment vehi- yet in Shell’s divestment pro-
tives. A large write-down at pages of documents to the worth nearly $5 billion, marking cle formed by Washington- gram.
that stage threatened to wipe New York Democrat, most of important milestones in the oil based EIG Global Energy Part- It is the latest deal in the re-
out the company’s capital. which have been shared with giant’s move to unload $30 bil- ners and Singaporean gion, where many big oil compa-
To end the litigation, the SEC, according to people lion in assets. commodities trader Noble nies are looking to sell off or re-
Toshiba made several deals in familiar with the matter. The Anglo-Dutch company Group Ltd. structure their interests after
October 2015. It acquired Stone Exxon hadn’t booked a de- is unloading oil fields, refiner- Shell also said it is selling its decades of pumping oil and gas
& Webster for $229 million in cline in the value of its assets ies, pipelines and other opera- interest in a Thai gas field to from dwindling fields. In Janu-
deferred payments and became since at least 1990. This is due tions to help pay for its state-owned Kuwait Foreign ary, BP PLC agreed to sell a
the only guarantor on the engi- in part to the company’s prac- roughly $50 billion acquisition Petroleum Exploration Co. for number of North Sea assets to
neering contract, releasing tice of being more conserva- of smaller rival BG Group last $900 million. exploration and production com-
CB&I. Scana agreed to push tive when initially recognizing year. The deal bolstered Shell’s The deals are among several pany EnQuest PLC.
back the completion date for the value of new oil and gas dominant position in global widely expected early this year, The North Sea was once
the South Carolina plant, but that it discovers, according to natural-gas markets and boosting confidence in the com- one of the world’s premier res-
negotiated a deal where it analysts and people familiar snagged potentially lucrative pany’s debt-reduction plans. ervoirs of crude oil, but many
would pay Toshiba $505 million with its accounting. oil fields off the coast of Bra- Shell’s commitment to slim of its fields have been drained
in exchange for switching to a It is also related to a man- zil, but also loaded the com- down has proved challenging at nearly dry.
fixed-price contract. Toshiba agement view that it is better pany with debt that had bal- a time of low oil prices that —Sarah Kent
agreed. to place a high burden on ex-
ecutives to ensure that proj-
ects can work at lower prices lion barrels of its reserves, those reserves are worth is could happen next year. Ac-
Toshiba than to write down their mostly in Canada’s oil sands, separately overseen by the Fi- cording to the accounting
executive value. The company’s senior aren’t profitable to produce, nancial Accounting Standards rules, such a determination
Danny leaders wanted to avoid write- according to SEC rules. The Board, an independent group would depend in part on
Roderick is downs because in accounting reserve losses might be offset that sets accounting standards Exxon’s view of future prices.
expected to terms, they have the effect of somewhat by new finds last for U.S. public companies. As Exxon Chief Executive Dar-
step down making the company’s invest- year, Jeff Woodbury, Exxon’s oil and gas producers spend ren Woods also plans a spend-
soon. ments appear more profitable, vice president of investor rela- money drilling new wells, ing increase this year, making
according to people familiar tions, told analysts Tuesday. those expenses can be capital- the company an anomaly
with Exxon’s practices. Although Exxon might no ized as an asset. But when ex- among major oil firms that
Southern faced up to $1.5 “We don’t do write-downs,” longer qualify those reserves pected future cash flow from mostly plan to continue mak-
billion in liability in the law- former Chief Executive Rex as “proved” based on SEC the reserves is no longer ing cuts. Exxon plans to spend
suits over post-Fukushima Tillerson told trade publica- rules, Mr. Woodbury said the greater than their so-called about $22 billion in 2017, up
safety-cost overruns, and set- tion Energy Intelligence in company wouldn’t alter its op- carrying value, which relates about 15% from last year.
tled for about $350 million in 2015. “We are not going to bail erations or change how it to the amount that was capi- Other companies such as
October 2015. The deal re- you out by writing it down. manages those assets. talized, the rules indicate that Chevron Corp. are continuing
stricted Westinghouse’s ability That is the message to our or- There are separate pro- a write-down is needed. to reduce their investment lev-
to “seek further increases in ganization.” cesses and rules that govern Thus, while the Canadian els even amid a modest oil-
the contract price,” Southern For the October-to-Decem- how oil-and-gas companies reserve losses didn’t result in price rebound.
said—meaning that if the nu- ber period, profit fell to $1.68 book reserves to assure inves- a write-down immediately, —Anne Steele
clear plant couldn’t be com- billion, or 41 cents a share, tors that they are finding new there is still a chance that contributed to this article.
pleted in a timely manner, from $2.78 billion. Analysts sources of future production
Toshiba would shoulder the polled by Thomson Reuters and how they value them. The
costs. were expecting 70 cents a SEC requires companies to
As problems contin- share. Revenue increased for evaluate their future prospects Notice to Security Holders of
ued, Westinghouse and CB&I the first time in over two based on the average price of
last year sued each other over years, rising 2% to $61 billion. the previous year, in this case NUVEEN HIGH INCOME
the Stone & Webster sale. Then Exxon also signaled Tues- about $43 a barrel. That is a DECEMBER 2018 TARGET TERM FUND (JHA)
Toshiba said it might need to day that it is likely to recog- 15% drop from 2015. NUVEEN MUNICIPAL
take a write-down of several nize that as much as 4.6 bil- Recognizing how much
billion dollars related to the
2021 TARGET TERM FUND (NHA)
value of Stone & Webster,
caused by cost overruns. Rare Write-down The following Funds are making generally available to their security
While Southern said it is in- While peers slashed asset values as oil prices fell, Exxon didn't holders an earnings statement for the twelve-month period ended January
sulated from cost overruns, it is 31, 2017, in connection with a Registration Statement of each Fund:
until the end of 2016.
unclear if the $920 million line Nuveen High Income December 2018 Target Term Fund: No. 333-205695,
of credit from Westinghouse Total impairments since 2012, in billions with respect to 26,100,000 Common Shares, $.01 par value, of the Fund,
would be sufficient to complete which was filed with the Securities and Exchange Commission under
BP* $25.9
its two generating units if the Securities Act of 1933, as amended, and which became effective on
Westinghouse’s financial prob- Royal Dutch Shell* $22.2 November 12, 2015.
lems prevent it from fulfilling
Nuveen Municipal 2021 Target Term Fund: No. 333-207475, with respect
its contract. Total SA* $17.8 to 8,100,000 Common Shares, $.01 par value, of the Fund, which was filed
“I don’t see how Southern with the Securities and Exchange Commission under the Securities Act of
and Scana are confident they Chevron $11.4 1933, as amended, and which became effective on January 26, 2016.
won’t be responsible for any
further cost increases,” said ConocoPhillips* $6.2 Copies of each such earnings statement will be furnished upon written
Sara Barczak, a critic of the request directed to: Gifford R. Zimmerman, Secretary, (Attn: Fund Name),
projects who works for the Exxon Mobil $2.0 333 West Wacker Drive, Chicago, IL 60606.
Southern Alliance for Clean En-
ergy, a nonpartisan advocacy Date: 31 January 2017 © 2017 Nuveen
*Have yet to report full-year 2016 figures
group. Source: S&P Global Market Intelligence THE WALL STREET JOURNAL.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
Elliott
Fires Shot
At Arconic
BY DAVID BENOIT AND BOB TITA
Elliott Management Corp.
launched a campaign Tuesday
to shake up the board of Ar-
conic Inc. and oust Chief Exec-
utive Klaus Kleinfeld, three
months after he separated the
aerospace and automotive-
parts maker from aluminum
giant Alcoa.
The activist hedge fund’s an-
nouncement that it would nom-
inate five directors to Arconic’s
board and seek to oust Mr.
Kleinfeld as CEO came just an
hour after the company re-
ported its first quarterly results
as a stand-alone company and
just before Mr. Kleinfeld was
scheduled to discuss the results
with investors and analysts.
Elliott, Arconic’s largest
shareholder with a 10.5%
stake, cited cost overruns, the
company’s stock performance
and a “broken company cul-
ture” in a presentation to in-
vestors. The Wall Street Jour-
nal reported Monday that
several of Arconic’s biggest in-
vestors have urged the com-
pany to remove Mr. Kleinfeld.
The company said Mr.
Kleinfeld has the unanimous
support of its board, which in-
cludes three directors Elliott
backed last year in an earlier
settlement. Mr. Kleinfeld is the
board’s chairman.
Arconic said its current slate
of directors are executives or
former executives with “a broad
range of knowledge, experience
and skills at the highest levels
of both public and private com-
panies.” It said the board had
reviewed Elliott’s allegations
and found that many are “mis-
leading or not substantiated.”
“Klaus and the management
team are 100% focused on con-
tinuing to improve operating
results, expand margins, im-
prove return on net assets and
deliver sustained shareholder
value,” said Pat Russo, Ar-
conic’s lead director.
In an interview Tuesday be-
fore the hedge fund’s announce-
ment, Mr. Kleinfeld attributed
the dissatisfaction of some in-
vestors to their unfamiliarity
with the aerospace, automotive
and defense markets Arconic
serves. He said the company’s
shareholder base is still largely
made up of commodity-focused
investors, but that is changing.
“We are always open to en-
gage with our shareholders,”
he said.
Arconic’s board has 13
members, and five seats will
be up for election at the an-
nual meeting this spring. El-
liott is nominating directors
for all five spots but said it
wouldn’t run a candidate
against Ulrich Schmidt, one of
the directors it backed last
year, if he runs for re-election.
The hedge fund is propos-
ing Larry Lawson, the former
chief executive of Spirit Aero-
Systems Inc., to replace Mr.
Kleinfeld as CEO.
Mr. Lawson “has the ideal set
of skills needed to turn around
Arconic’s woefully and continu-
ally underperforming business,”
Elliott said in its presentation.
The fight likely will hinge on
whether investors believe Mr.
Kleinfeld can boost the com-
pany’s margins and profitability.
Arconic has said Mr. Klein-
feld has cut $4.4 billion in
costs since he joined and more
than doubled the company’s
combined margin on earnings
before interest, taxes, depreci-
ation and amortization to 15%.
The company said
Mr. Kleinfeld has the
unanimous support
of its board.
It is targeting 17% for 2019.
The fight came after Ar-
conic posted results slightly
weaker than expected in its
first quarterly report as a
stand-alone company.
For the latest quarter, the
company posted a loss of $1.25
billion, or $2.88 a share, com-
pared with a loss of $701 mil-
lion, or $1.64 a share, a year
ago. Excluding certain items,
adjusted earnings were 12
cents a share, up from 3 cents,
but a penny shy of analysts
surveyed by Thomson Reuters.
Revenue edged up 0.8% to
$2.96 billion, just shy of the
$3 billion analysts expected.
—Ezequiel Minaya
contributed to this article.
* * * *
Under Armour Plunges After Slip
Shares fall 23% after
athletic-gear maker
reports drop in profit
and slowing growth
BY SARA GERMANO
AND ANNE STEELE
The streak is over. Under
Armour Inc.’s shares fell more
than 23% Tuesday as the com-
pany missed its revenue target
after 26 straight quarters of at
least 20% revenue growth.
The athletic-gear maker re-
ported that sales increased
just 12% in the holiday quar-
ter and revenue would in-
crease about half as much as
anticipated this year. The
slowing growth, coupled with
unexpected declines in quar-
terly profit, fanned fears
about Under Armour’s ability
to continue to win market
share from Nike Inc. and Adi-
das AG without heavier dis-
counting.
Under Armour, after its
rapid ascent from college
locker rooms to mass retail-
ers, must now cope with a
UPS Battles Costs From E-Commerce Surge
BY PAUL ZIOBRO
United Parcel Service Inc.
was stung by the rapid shift to
e-commerce this past holiday
season, as higher costs from a
glut of package deliveries hurt
its bottom line.
The Atlanta-based carrier
posted higher sales in its fourth
quarter, but profit margins fell
as its home deliveries outpaced
its more profitable business-to-
business segment.
UPS pledged to spend $4 bil-
lion this year, a 33% increase
from 2016, as it tries to keep up
with consumers’ shift to online
shopping.
“E-commerce brings chal-
lenges, it certainly brings great
opportunities,” UPS Chief Exec-
utive David Abney said Tuesday
on a call with analysts. “If this
Retailer H&M aims to put more emphasis on its online sales.
H&M Recalibrates
With Online Shift
BY MATTHIAS VERBERGT
STOCKHOLM—Hennes &
Mauritz AB said it is abandon-
ing its goal of opening 10% to
15% more stores globally each
year—a blistering pace that
turned it into one of the world’s
largest clothing retailers—shift-
ing to a new measure for growth
that includes online sales.
Instead, H&M will aim to
boost sales in every market it
operates by 10% to 15% in local
currency, with a new emphasis
on its online business.
The company disclosed the
change on Tuesday along with
strong quarterly results, de-
spite struggles in some of its
traditionally strong markets,
including the U.S., Europe and
China. The Swedish company
benefited from some emerging
markets, such as India, Mexico,
South Africa and Turkey, after
recently expanding there.
For years, H&M and its big-
ger European rival Inditex SA
raced each other around the
world opening stores that sell
so-called fast fashion—items
that can be designed, made
and rolled out to stores quickly
to keep up with changing fash-
ions and trends. Zara parent
Inditex started to slow its
store openings last year, while
H&M held on to its annual goal
Wednesday, February 1, 2017 | B3
BUSINESS NEWS
shift away from performance business shot up 55%.
equipment, fewer visits to re-
tail stores and increased com-
petition from new players in
Coming Up Short
Shares in Under Armour fell yesterday as the company missed its
target of 20% revenue growth.
“Numerous challenges and
disruptions in North Ameri-
can retail tempered our
the athletic-apparel market. fourth-quarter results,” Mr.
“This quarter was probably Share price Revenue, change from prior year Plank said.
as perfect [a] storm as you can In all, for the December pe-
get against them, since they’re $45 35% $1.3B riod, Under Armour reported a
highly dependent on the North 30 ▲12% profit of $104.9 million, or 23
40
American market,” said John 25 cents a share, down from
Horan, publisher of industry 35 $105.6 million, or 24 cents, a
tracker Sporting Goods Intelli- 20 year earlier. Revenue rose 12%
30
gence. Baltimore-based Under 15 to $1.31 billion. Analysts polled
Armour’s billionaire founder, 25 by Thomson Reuters had fore-
10
Kevin Plank, defended his busi- Tuesday cast earnings of 25 cents on
ness strategy in a conference 20 5 $1.41 billion in revenue.
$19.22
call Tuesday, though he admit- 15 ▼23.4% 0 Gross margin fell to 44.8%
ted the company needed to re- compared with 48% last year,
focus. “As we pass through $5 J J A S O N D J 2013 ’14 ’15 ’16 as better pricing was offset
billion on our way to $10 bil- Sources: WSJ Market Data Group; S&P Capital IQ THE WALL STREET JOURNAL. by aggressive efforts to man-
lion, we must get better, faster age inventory, changes in for-
and smarter at what we do, low the $6.06 billion analysts senior vice president of cor- eign currency, and the out-
why we do it and how we do had predicted. Despite adding porate finance, will serve as performance of the lower-
it,” he said. roughly $600 million in reve- acting chief financial officer. margin footwear and
As shares plummeted on nue in 2016, the company ex- Mr. Molloy will remain with international businesses. Ap-
Tuesday, Under Armour short pects its operating income to the company in an advisory parel sales rose 7.4% to
sellers reaped more than decline by about $100 million capacity to assist with the $928.5 million for the quarter,
$400 million on their posi- from the previous year. transition. with strength in golf and bas-
tions, according to Ihor Du- Under Armour also said its During the latest quarter, ketball.
saniwsky, head of research at finance chief, Chip Molloy, sales in North America, which —Ben Eisen
analytics firm S3 Partners. has decided to leave the com- make up more than 80% of the contributed to this article.
For 2017, the company ex- pany for personal reasons af- business, rose 5.9%, while sales
pects revenue to rise 11% to ter a year on the job. Effec- in the much smaller—and  Heard on the Street: Under
12% to about $5.4 billion, be- tive Friday, David Bergman, lower-margin—international Armour, a reckoning............ B16
quarter taught us anything, liveries with new routing sys- “We have to put more em- taled $79 million.
we’ve got to quicken the pace.” tems that optimize routes and phasis on making sure that we Revenue grew 5.5% to $16.93
UPS also issued an earnings bundling orders to be delivered pass on to our customers the billion. On an adjusted basis,
outlook below analysts’ esti- on certain days. increase in costs that e-com- the company said revenue was
mates reflecting lower profits It is also raising prices so it merce deliveries can bring,” Mr. $16.99 billion.
from residential deliveries and a can recoup the higher delivery Abney said in an interview. For the year, UPS is forecast-
stronger U.S. dollar. He said that in negotiations ing earnings of $5.80 to $6.10 a
UPS shares fell $7.90, or with larger customers about share, below the $6.17 expected
6.8%, to $109.13 in 4 p.m. com- rate increases, UPS hasn’t got- by analysts polled by Thomson
posite trading on the New York
The company said ten “any more pushback than Reuters.
Stock Exchange. residential deliveries we’d get any year.” The weaker forecast comes
Shares of rival FedEx Corp. UPS reported a loss $239 even as the carrier anticipates
fell 2.1% to $189.11.
are squeezing million, or 27 cents a share, for stronger economic conditions
As more people shop online, its profit margins. the quarter, compared with a in the U.S., with the White
UPS and FedEx are struggling to profit of $1.33 billion, or $1.48 a House expected to push for
keep up with the extra costs of share, a year earlier. lower tax rates and infrastruc-
having its drivers stop at homes Excluding items such as a ture investments.
and apartment buildings. costs as well as the additional mark-to-market pension “There’s a big focus on the
UPS said 55% of shipments in investments it is making to han- charge, earnings rose to $1.63 economy,” Mr. Abney said.
the quarter were to residential dle the increased volume. Last a share from $1.57. The most “That excites us because eco-
addresses, including 63% of all year, UPS spent nearly $3 bil- recent quarter included mark- nomic growth is the wood that
deliveries in December. lion on capital expenditures, in- to-market expenses of $1.67 starts our fire.”
The company is trying to off- cluding adding 7 million square billion, while the charges for —Imani Moise
set the added costs of those de- feet of new capacity. the year-earlier quarter to- contributed to this article.
GEORGE FREY/GETTY IMAGES
of opening 10% to 15% more
stores around the world.
“H&M-branded physical
stores didn’t reach the goals,”
said H&M Chief Executive
Karl-Johan Persson in an inter-
view on Tuesday. The company
hasn’t provided specific sales-
growth targets in recent years.
At the end of the quarter,
H&M had 4,351 stores, an in-
crease of 427 compared with a
year earlier. H&M is now pres-
ent in 64 markets.
Mr. Persson said H&M is
considering selling its clothes
through another big online
competitor, China’s Alibaba
Group Holding Ltd.
H&M said profit rose 7% to
5.91 billion Swedish kronor
($669 million) in its fiscal
fourth-quarter ended Nov. 30,
from 5.53 billion kronor in the
year-earlier period. Analysts
polled by FactSet had expected
profit of 5.42 billion kronor.
Fourth-quarter sales, in-
cluding value-added tax and
converted into kronor, rose 8%
to 61.10 billion kronor.
For the full year, H&M’s
profit fell 11% to 18.64 billion
kronor. The company cited in-
creased markdowns during the
year, along with higher pur-
chasing costs caused by the
strong U.S. dollar. Sales rose
6% to 222.87 billion kronor.
B4 | Wednesday, February 1, 2017
Technology Leaders Chide Amazon to Build Air-Cargo Hub
And Engage the President
BY JACK NICAS AND TIM HIGGINS
As Elon Musk and other
technology executives voiced
concern over the weekend
about President Donald
Trump’s immigration order, he
also asked the public for sug-
gestions on how to fix it.
“Please read immigration or-
der. [Let me know] specific
amendments,” read a post Sun-
day on the Tesla Motors Inc.
chief executive’s Twitter ac-
count. Mr. Musk added that he
intended to recommend changes
to the policy as a member of a
White House advisory group.
Mr. Musk’s role as a Trump
adviser is unusual in Silicon
Valley, but his effort to balance
criticism and constructive en-
gagement reflects the broader
quandary Silicon Valley faces as
it tries to reconcile industry
opposition to many of the new
president’s positions with the
reality of doing business under
a Trump administration.
Tech leaders were among
the earliest and most vocal
critics of Mr. Trump’s immigra-
tion order starting within hours
of its signing on Friday. The or-
der restricts travel and immi-
gration from seven Muslim-ma-
jority nations because of
concerns about terrorists en-
tering the U.S.
Apple Inc. is weighing legal
action and continuing to press
the Trump administration to
reverse the order, Chief Execu-
tive Tim Cook said in an inter-
view Tuesday.
Mr. Cook said hundreds of
Apple employees have been af-
fected by the order. He added
that he continues to contact
“very, very senior people in the
White House” and impress on
them why repealing the execu-
tive order is important not only
for Apple but for the country.
The White House has de-
fended the immigration order,
saying it is an effort to prevent
terrorists from entering the
U.S. and has wide support
among Americans. Thousands
of people gathered at airports
across the country over the
weekend to protest the policy.
Tech-industry criticism con-
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Tesla’s Elon Musk is part of a
White House advisory group.
tinued Monday, with Ama-
zon.com Inc. CEO Jeff Bezos
saying the e-commerce giant is
exploring legal options to help
counter the order. His company,
along with Microsoft Corp. and
Expedia Inc., is supporting a
lawsuit filed by Washington
state against the order.
Google co-founder Sergey
Brin and Chief Executive Sun-
dar Pichai on Monday attended
a rally of their employees op-
posed to the order, where both
men spoke against the policy.
But the big tech companies’
statements were careful to tar-
get the immigration order, in
many cases not even mention-
ing the Trump administration
directly. And some executives,
like Mr. Musk, have emphasized
the need to work with the ad-
ministration. Dell Technolo-
gies Inc. CEO Michael Dell, in a
message to employees Monday,
said “it’s imperative to us, our
customers and partners that we
have a seat at the policy table.
It’s an opportunity to influence
the policies that impact our
collective ability to compete.”
“The practical matter is,
you’re running a company
worth billions of dollars and
they’re the regulators, so what
choice do you have” but to en-
gage with the new administra-
tion, said Wesley Chan, a for-
mer Google executive turned
tech investor.
Companies usually are cau-
tious in dealing with a new ad-
TECHNOLOGY
ministration. But the tech in-
dustry’s dance is especially
delicate under Mr. Trump be-
cause of its history of discord
on issues including immigration
and overseas manufacturing as
well as the industry’s broad op-
position to his candidacy. Tech
companies also enjoyed gener-
ally supportive policies under
the Obama administration.
Google, a unit of Alphabet
Inc., has struggled internally
with how to approach the
Trump administration. At a
weekly meeting just after Elec-
tion Day, six of its top execu-
tives, including co-founders Mr.
Brin and Larry Page, spoke emo-
tionally to employees grappling
with Mr. Trump’s victory, ac-
cording to an account from
someone who saw it.
Mr. Brin, who immigrated to
the U.S. from Russia as a 6-year-
old, said at the November meet-
ing, which was broadcast to em-
ployees, that the presidential
campaign was “deeply offen-
sive” and “conflicts with many
of our values.” Mr. Pichai choked
up when he vowed the company
would stand up for minorities.
But the executives also made
clear that they had to work
with the administration. Mr. Pi-
chai said Google was talking to
Mr. Trump’s transition team,
and he asked Google employees
to support that process.
Google declined to comment.
Mr. Musk has performed his
balancing act partly in public,
via Twitter. He wrote there late
Saturday that the immigration
order is “not the best way to
address the country’s chal-
lenges.” On Sunday afternoon,
he promised to bring up the
policy during a meeting of the
president’s Strategic and Policy
Forum, on which he serves.
Late Sunday, he retweeted
another user’s message that said
the order “was far less bad than
portrayed,” and responded that
reading the “source material is
better than reading other peo-
ple’s opinions about the source
material.” Then he followed that
overnight with a tweet that said
the order “is still bad.”
—Tripp Mickle contributed
to this article.
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Revenue Up at Electronic Arts
BY SARAH E. NEEDLEMAN
Electronic Arts Inc. on
Tuesday posted a 7% gain in
revenue for the holiday quar-
ter as two of its marquee
games, “Battlefield 1” and “Ti-
tanfall 2,” delivered mixed re-
sults amid stiff competition.
The No. 2 U.S. game pub-
lisher by market value after
Activision Blizzard Inc. said
sales of “Battlefield 1” ex-
ceeded expectations, while
“Titanfall 2” sales fell short of
projections.
EA released both first-per-
son shooters within weeks of
each other in October. EA
didn’t disclose how many cop-
ies of “Battlefield 1” or “Titan-
fall 2” it sold in the fiscal
third quarter ended Dec. 31.
Neil Doshi, an analyst at
Mizuho Securities Co., said he
thinks “Battlefield 1” sold 15
million copies in the holiday
quarter. That would mean it
likely fared better than EA’s
‘Mario’
Disappoints
Nintendo’s
Chief
BY TAKASHI MOCHIZUKI
OSAKA, Japan—Nintendo
Co. said its smartphone game
“Super Mario Run” has
brought in over $50 million
since going on sale in Decem-
ber, a performance analysts
said was better than expected,
but Nintendo’s chief executive
wasn’t satisfied.
“Super Mario Run,” re-
leased for Apple Inc.’s iPhone
in December, has been
watched closely because it is
the first time Nintendo has
put one of its leading charac-
ters in a smartphone game in-
stead of games for Nintendo’s
own hardware.
Initial results released
Tuesday show the Mario game
Dividend Notice
The Board of Directors of Canadian
National Railway Company has declared
a quarterly dividend of CDN$ 0.4125
per share on the outstanding common
shares. The quarterly dividend is
payable on March 31, 2017 to
shareholders of record at the close
of business on March 10, 2017.
By order of the Board
Sean Finn
Executive Vice-President
Corporate Services and
Chief Legal Officer
Montreal, Quebec
January 24, 2017
* ***** THE WALL STREET JOURNAL.
“Star Wars Battlefront,” which
the company said sold more
than 13 million copies in the
final quarter of 2015, in addi-
tion to costing the company a
royalty fee.
Mr. Doshi estimated “Titan-
fall 2” sold about five million
units in the holiday quarter.
On Tuesday, shares of Elec-
tronic Arts fell 1.7% in after-
hours trading to $82.01.
EA said its latest “FIFA”
game helped lift sales for the
holiday period since it came
out late in the prior quarter.
In addition, the company said
revenue from “Ultimate
Team”—a special feature in-
side the company’s sports
games that lets players create
fantasy teams and compete
with others—rose 22%.
EA’s loss in the quarter nar-
rowed to $1 million from $45
million a year earlier, as reve-
nue climbed to $1.15 billion,
slightly above the company’s
expectations, and up from
Nintendo CEO Tatsumi Kimishima said initial results for the
smartphone game ‘Super Mario Run’ weren’t satisfactory.
has been far more successful
than the typical smartphone
game but still might not bring
in enough revenue by itself to
significantly boost Nintendo’s
bottom line.
“Super Mario Run” for Ap-
ple iOS devices has generated
more than 78 million down-
loads globally, Nintendo said.
More than 5% of those have
paid the $10 charge required
to unlock the game’s full con-
tent, bringing in more than ¥6
billion ($53.2 million) in reve-
nue so far, it said.
“For a game that charges
this much, the performance is
pretty amazing,” said Serkan
Toto, a Tokyo-based mobile-
game consultant. He said even
games that charge only a dol-
lar or two for in-game items
usually convert fewer than 5%
WSJ.com/Tech
ROSS D. FRANKLIN/ASSOCIATED PRESS
$1.07 billion a year earlier.
Full-game downloads, add-
on content and other non-
packaged items continued to
grow for EA. Digital revenue
reached $685 million, up 20%
from the year-ago period.
EA said its mobile game
“Star Wars: Heroes of the Gal-
axy” was a significant driver
of digital sales, with fans now
spending an average of 155
minutes a day playing it.
Mobile revenue overall
reached a record of $147 mil-
lion, up 16% from the year-ago
period, the company said.
Analysts who cover video-
game companies commonly
track financial measures ad-
justed for factors such as de-
ferred sales of online services.
EA stopped reporting those
figures last year, but based on
its results statement, adjusted
revenue in the holiday quarter
rose 15% to $2.07 billion,
while adjusted profit rose 36%
to $2.48 a share.
KIYOSHI OTA/BLOOMBERG NEWS
he hasn’t paid for extra func-
tions on other free-to-down-
load games.
Nintendo isn’t ruling out
other ways of earning money
from smartphone games.
Pokémon Go, a smash-hit
game app developed by a Nin-
tendo affiliate, charges small
amounts for in-game features
such as incense to attract vir-
tual Pokémon creatures. That
payment model was adopted
by Nintendo for the smart-
phone version of its Fire Em-
blem game, which it plans to
release in February.
Mr. Kimishima said Nintendo
would release more smart-
phone games including “Animal
Crossing,” which was originally
expected by March but now is
set to come in April or later.

 
 brokers@gottesman-company.com of downloaders into paying

 
  
 
  
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United States § Canada § Europe
customers.
Nonetheless, Nintendo Chief
‘For a game that
www.cn.ca
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Executive Tatsumi Kimishima charges this much,
said he wasn’t satisfied with
the performance is
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THE price was considered high.

However, some users said they
lion, more than double the
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THE WALL STREET JOURNAL. * * * * * NY Wednesday, February 1, 2017 | B5

BUSINESS NEWS BUSINESS WATCH

Aetna Outlines
Growth Options
BY ANNA WILDE MATHEWS tion representatives and that it
AND JOSHUA JAMERSON is “too soon to tell” what will
result from the Republican
Health insurer Aetna Inc. overhaul of the ACA, which he
fielded questions from Wall said he thought would take ef-
Street about its growth plans fect “at the earliest” in 2019.
as it reported earnings that He said that “everybody is
beat analysts’ expectations a very concerned about doing
week after a federal judge something rash that would
blocked its proposed merger blow the thing up and put
with Humana Inc., citing anti- people out of coverage.”
trust concerns. The company said it was still
Aetna’s net income dropped deciding whether to appeal the
sharply in the fourth quarter, antitrust ruling against the Hu-
hurt by restructuring costs, mana merger or terminate the
though revenue rose. deal, which is currently slated to
Chief Executive Mark T. Ber- expire on Feb. 15.

LEON NEAL/GETTY IMAGES

tolini said in an interview that Regarding engines for
the insurer wouldn’t expand its growth without Humana, Mr.
presence in the Affordable Care Bertolini highlighted organic
Act’s exchanges for 2018 and is Medicare growth and the com-
re-evaluating its current foot- pany’s Medicaid business, de-
print for next year. He said that spite some recent setbacks, as
Aetna had spoken with Capitol well as its core commercial
Hill officials and Trump transi- franchise. Harley-Davidson expects to ship up to 71,000 motorcycles in the first quarter. Above, a man tries out Low Rider in England last year.

HARLEY-DAVIDSON SPRINT area, the latest U.S. company to dozens of news staffers at The

Pratt & Whitney Gets Flat Shipments

Expected for Year
Loss Narrowed
In Latest Quarter
say they are gravitating toward
the Windy City in search of tal-
ent and better travel connections.
Wall Street Journal, according to
people familiar with the matter.
The Journal’s parent company,

New Heads for Engines Harley-Davidson Inc. said

BY DOUG CAMERON geared turbofan engines.
Mr. Calio was formerly chief
United Technologies Corp. of staff to United Technologies
said Tuesday it was appointing Chief Executive Greg Hayes. He
new leaders at its big aircraft takes over from Greg Gern-
engine businesses, including the hardt, who will remain at the
commercial unit where produc- company.
tion problems have hampered United Technologies said
the introduction of a new model Matthew Bromberg would suc-
aimed at reinvigorating the ceed Bennett Croswell as head
company’s jetliner franchise. of Pratt’s military arm after
The company also said the the latter retires in May but
president of the military arm of join the division Feb. 1. Mr.
its Pratt & Whitney engine Bromberg previously ran
subsidiary was retiring, just Pratt’s commercial aftermarket
weeks after the head of its unit operations, and the move
building engines for the F-35 comes as the Pentagon focuses
combat jet was unexpectedly more on cutting sustainment
replaced. expenses for the F-35 that is
United Technologies said built by Lockheed Martin
Chris Calio would take over as Corp. as well as the production
head of Pratt’s commercial cost that has come under at-
business from Feb. 1, leading tack by President Donald
the production of its new Trump.
Tuesday it expects shipments to
stay flat or decline slightly in 2017,
signaling another tough year for
the Milwaukee motorcycle maker.
Harley expects to ship up to
71,000 motorcycles in the first
quarter, about 15% fewer than
the prior year, as dealers sell
their inventories of 2016 models.
Revenue from motorcycles
and related products fell to $5.27
billion in 2016 from $5.31 billion
the previous year.
For the quarter that ended in
December, Harley reported net
income of $47.2 million, or 27
cents a share, up from $42.2 mil-
lion, or 22 cents a share, a year
earlier. Analysts polled by Thom-
son Reuters expected net in-
come of 31 cents a share. Reve-
nue in the quarter fell 7.4% to
$933 million, below the $972.5
million expected by analysts.
—Andrew Tangel
Sprint Corp. narrowed its loss
in its third fiscal quarter as the
wireless carrier continued to
grow its customer base.
The company said postpaid
phone net additions of 368,000
were the highest in four years.
In all for the December quar-
ter, Sprint posted a loss of $479
million, or 12 cents a share, com-
pared with a loss of $836 million,
or 21 cents a share, a year ago.
Revenue rose 5.5% to $8.55 bil-
lion. Analysts polled by Thomson
Reuters had forecast a loss of
nine cents a share on $8.29 bil-
lion in revenue.
—Anne Steele
CATERPILLAR
Headquarters
To Move to Chicago
Caterpillar Inc. is moving its
headquarters to the Chicago
Caterpillar expects about 300
employees to be based in the
new Chicago office, including
some from the company’s long-
time home in Peoria, Ill. Caterpil-
lar said that means it will scrap
plans to build a new headquar-
ters complex there, though about
12,000 employees will remain in
its current offices.
“Peoria will continue to be our
hometown,” said Caterpillar Chief
Executive Jim Umpleby.
—Andrew Tangel
and Shibani Mahtani
NEWS CORP
Dow Jones Revamps
In Europe and Asia
Faced with steep declines in
advertising revenue, Dow Jones &
Co. is reorganizing some of its op-
erations across Europe and Asia
to further reduce costs—moves
that will result in the layoffs of
Dow Jones, is moving toward cre-
ating continentwide filing and re-
porting hubs in cities such as Lon-
don and Barcelona to deal with
regional newswire operations pre-
viously handled by individual bu-
reaus, the people said. As part of
that effort, the U.S.-based news-
paper will be closing some interna-
tional offices and paring back in
some coverage areas, they said.
A Dow Jones spokeswoman
wouldn’t comment on specifics,
but said the moves were part of a
broader reorganization review the
company announced in late 2016.
Last year, Dow Jones, a unit
of News Corp, announced plans
for a substantial revamp of the
print newspaper and offered
buyouts to employees across the
company, while warning of possi-
ble involuntary layoffs. The com-
pany also announced a review of
operations, dubbed WSJ 2020.
—Lukas I. Alpert and
Jeffrey A. Trachtenberg

ADVERTISEMENT

Career Opportunities
To advertise: 800-366-3975 or WSJ.com/classifieds

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For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
B6 | Wednesday, February 1, 2017 THE WALL STREET JOURNAL.

MANAGEMENT

Shifting Gears After Promotions

The transition from specialized jobs to general-manager positions is becoming tougher as employers trim management layers, demand faster results
BY JOANN S. LUBLIN he said. Those apparent leagues soon updated Ma-
messes actually might be “a rimekko’s print design, de-
Just like a car stuck in different way of doing some- velopment and
gear, many functional lead- thing correctly.’’ commercialization by tying
ers struggle to shift into a Taking charge of unfamiliar operations together and im-
new mind-set after they be- territory represents another proving their efficiency, a
come general managers. challenge for such newly ap- spokeswoman said. Ms. Ala-
Rising stars often advance pointed general managers. huhta-Kasko became chief
their careers by leaping from Tiina Alahuhta-Kasko was executive last April.
specialized positions to first- the 32-year-old marketing An early foray into general

RYAN CHRISTOPHER JONES FOR THE WALL STREET JOURNAL

rung executive roles that typ-
ically oversee
YOUR business units.
EXECUTIVE The transi-
CAREER tion, however,
can be tough.
Experts in, say,
information technology sud-
denly must supervise work
that they often know little
about, such as finance or ad-
vertising. The hurdles have
become higher recently as em-
ployers trim management lay-
ers, increase job specialization
and demand faster results, ac-
cording to executive coaches
and strategy consultants.
“More high-potential lead-
ers don’t succeed at this tran-
sition than a decade ago,’’ said
Michael D. Watkins, professor
of leadership and organiza-
tional change at IMD Business
School in Switzerland.
Erik Manley had difficulty delegating some duties in 2014 when he was promoted at Frog Design.
Erik Manley faced this tran-
sition dilemma in 2014 when
the veteran program manager
took charge of two U.S. stu-
dios at Frog Design Inc., a
product-design company. For
months, he said, he had diffi-
culty delegating some duties
that he could handle faster.
Frog Design retained exec-
utive coach Rose Fiorilli to
counsel Mr. Manley for six
months following his promo-
tion. Ms. Fiorilli said she
regularly reminds new gen-
eral managers that they can’t
chief of Marimekko Corp.
when the Finnish design
house elevated her to chief
operating officer in fall 2014.
“My personal expertise in
marketing and communica-
tions helped in the (previous)
leadership role,’’ Ms. Alahuhta-
Kasko recalled. The new oper-
ating chief oversaw a manage-
ment team that included top
sales, product and creative ex-
ecutives. But she was less fa-
miliar with their areas.
She believes that she won
trust by admitting she had
plenty to learn before she
devise strategy, set priorities could fully understand Ma-
and implement business rimekko’s operations. “You
goals unless they relinquish must be open to your new
previous functional duties. team members about your
With his coach’s help, Mr. not knowing everything,”
Manley realized that “people and courageous about mak-
are going to mess up what I ing mistakes, she said.
think I could do correctly,’’ The COO and her col-
management almost derailed
Kelly J. Grier’s career at Ernst
& Young LLP, the U.S. arm of a
global business-services firm.
About 17 years ago, the
U.S. senior accounting spe-
cialist had gained a broad
management role based in
Europe. She managed 45
teams that advised a Fortune
50 company in about 40
countries. Her teams resisted
her push to serve the corpo-
rate client using a standard-
ized U.S. approach because
they preferred to follow their
local markets’ unique needs.
Unless she led differently,
she “was going to fail,’’ Ms.
Grier said. So she met with key
senior partners and got helpful
ideas about serving their cli-
ent better. Ms. Grier now over-
sees about 10,000 staffers in 15
central U.S. states.

Buying a Super Bowl Ad to Kick Off a Hiring Spree

BY JOSHUA JAMERSON
Advertisers such as Pep-
siCo Inc. and Budweiser spend
millions pushing their prod-
ucts to Super Bowl viewers. A
southern Pennsylvania build-
ing-supply chain is doing
something a little different
this year, using its first-ever
Super Bowl ad to kick off a na-
tional recruiting campaign.
With more than 100 million
people expected to watch Sun-
day’s big game, 84 Lumber
Co. is betting that its 90-sec-
ond spot would introduce
viewers to the company and
make a statement about Amer-
ican opportunity.
The Pittsburgh-area build-
ing-materials retailer is seek-
ing to fill 400 management-
trainee positions it plans to
create this year.
Companies spend millions
getting their products and ser-
vices in front of the nation’s
largest viewing audience, but
rarely—if ever—has a firm aired
a Super Bowl spot specifically
intended to attract potential job
applicants.
84 Lumber wouldn’t disclose
what it paid to air the 90-sec-
ond commercial, but with 30-
second spots going for as much
as $5 million, the company
could have shelled out $15 mil-
lion—for the airtime alone.
84 Lumber intends to run
more television ads nationally
in the coming months, and is
planning a social-media push.
Televised recruiting ads are
fairly rare, but as companies
compete to attract talent in a
tightening labor market, hir-
ing experts say more big-
ticket recruiting campaigns
may be on the way.
“It’s smart to me, though
obviously expensive,” said
John Sullivan, a professor at
San Francisco State Univer-
sity’s college of business who
specializes in human-resources
strategy. If 84 Lumber’s cam-
paign succeeds, other compa-
nies may follow suit, he said.
General Electric Co. ran a
comedic advertising campaign
last year as part of the com-
pany’s efforts to rebrand itself company’s entry-level manage- current economy and mood,
as a technology company. The ment training program from said Tim Calkins, a professor of
ads, which aired during last 600 spots to about 1,000. marketing at Northwestern Uni-
year’s Academy Awards broad- These hourly positions—load- versity who has studied Super
cast, sought to reintroduce GE ing and unloading trucks; main- Bowl ads. Ads for precious-met-
to software developers and taining inventory, among other als buyer Cash4Gold that aired
tout coding jobs, said Jen tasks—pay about $30,000 to during the 2009 game under-
Waldo, the head of human re- $38,000 a year, and 84 Lumber scored a mood of urgency at the
sources for GE Digital. frequently promotes trainees to nadir of the global financial cri-
In the ads, a new GE hire bigger roles in the company. sis, he said.
named Owen explains the com- Tom McCartney, 84 Lumber’s Rob Schapiro, chief creative
pany’s tech focus to baffled vice president of human re- officer at Brunner Inc., the
friends and family members. Ap- sources, says the ad is intended marketing firm that worked on
plications to GE Digital rose about to get job seekers thinking the 84 Lumber ad, said it would
24% in the months after the ads about 84 Lumber as a place to convey a patriotic message.
aired, according to the company, develop a career path. Mr. Mc- An earlier version of the spot
a sign that the spots gained Cartney himself started as a stirred controversy after Fox,
traction among job seekers. manager trainee in 1988 and has this year’s Super Bowl broad-
84 Lumber leaders are tak- since risen through the ranks. caster, reportedly rejected the ad
ing advantage of the booming Commercials during the big for its political content. A Fox
building market, expanding the game often reflect the nation’s spokesman declined to comment.

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resources.

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For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
PAID ADVERTISEMENT
Imagining the future.
Where is the next Google, Facebook, Uber, Airbnb
or Priceline coming from? Or, put another way:
What will be the next large-scale trend to transform
entire economic sectors, such as the Sharing
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Today these questions are being asked by many
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•••
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To identify the Next Big Thing, we might ask: What
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•••
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This already happens, in a modest way, every time
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one brand is on sale.
Yet, these ad hoc substitutions are just the tip of
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monetize micro-flexibility, at scale, will disrupt and
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A new “Flexibility Economy” will arise, alongside
the Sharing Economy and the Gig Economy.
•••
Monetizing micro-flexibility solves a huge,
expensive problem for payers who cover
the bills for a whole range of buyers.
Sometimes you buy a good or service but somebody
else is paying for it. Since the cost isn’t coming out
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prices and more concerned about quality, conven-
ience or even rewards. The typical bill-payer ends
up wondering, “How can I hold down these costs?”
It’s all about the upside.
First in a series of essays imagining the future of business.
Wednesday, February 1, 2017 | B7
This dynamic is easily seen, most notably, in the
U.S. healthcare market. Consumers are not incented
to save money on care when their total out-of-pocket
cost is the same co-pay no matter the price.
A similar problem affects business travel costs, par-
ticularly at small and medium-sized companies
where employees select their own flights and hotel.
Sometimes everyone in this travel market seems
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any savings they can realize aren’t worth their time,
trouble, inconvenience, discomfort and inefficiency.
And suppliers struggle with total price transparency,
where competitors can see and instantly match any
price reduction from anywhere in the world.
•••
The Flexibility Economy addresses these
problems for buyers, sellers and suppliers.
My new company, Upside, is all about monetizing
micro-flexibility to benefit all three parties. Upside
typically saves a company 10-15% on the cost of
every business trip, while giving the traveler a free
gift card – typically worth $100-$200 – for making
those savings happen. With Upside, travelers are
actually delighted to try to hold down travel costs.
Meanwhile, airlines and hotels get a new way to use
lower prices to capture valuable customers — without
destroying their public price integrity.
This was never possible before. But today, new and
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micro-flexibility to deliver both lower prices and
higher rewards — simultaneously.
Specifically, Upside’s Big Data algorithms instantly
scan and score 10,000+ possible itineraries for
each trip, locating the dozen or so best flight and
hotel options. The customer’s choices of flights and
room are then combined into a single purchase for
one low price. Component discounts are concealed
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The result: companies and travelers get significant
benefits, while airlines and hotels get more customers.
•••
The Flexibility Economy will touch many
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At Upside, we’re using small business travel as the
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The Flexibility Economy will soon revolutionize
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we can monetize flexibility to reward consumers,
strengthen our economy and help companies large
and small become more globally competitive.
— Jay Walker
Chairman and CEO
Upside / Upside.com
 For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
B8 | Wednesday, February 1, 2017
INTERNATIONAL PROPERTY REPORT: ITALY
ANTONIO CALANNI/ASSOCIATED PRESS
A Gucci store in Milan
High-End
Shopping
Space Is
In Vogue
BY THERESA AGOVINO
Italy’s economy is one of
the slowest in Europe, but you
would never know it from re-
tailer demand for stores in the
country’s most fashionable
shopping districts.
In the five years ended in
September, prime retail
rents—also known as “high
street” rents—in Rome surged
10%, to $1,148 a square foot a
year, while they rose 7%, to
$449 a square foot a year, in
Venice, according to real-es-
tate services firm Cushman &
Wakefield.
Milan’s high-street rental
growth has been the strongest
in the country, rising 12% over
five years, to $1,304 a square
foot a year, Cushman & Wake-
field said.
But during the past five
years, Italy’s economy was
anything but hot. In fact, it fell
2.8% in 2012 and 1.7% in 2013,
according to Moody’s Inves-
tors Service.
Moody’s said Italy’s gross
domestic product rose 0.8%
last year after increasing 0.7%
in 2015. It expects GDP to
jump 0.8% in 2017 and 1% in
2018.
Why the disconnect be-
tween economic growth and
high street rents?
Retail observers said it is
partly because Italians tend to
spend more of their disposable
$1,304
Recent yearly price of high-street
rental per square foot in Milan
income than nationalities,
such as Germans, who are big-
ger savers.
Even more important: A
large amount of purchases on
high streets are done by for-
eign tourists and other visi-
tors. With foreign travel
booming, retail sales are
strong in these popular dis-
tricts.
Today, Milan’s famed Via
Monte Napoleone features
stores from many of Italy’s top
designer names. It is the sixth
most-expensive retail strip in
the world and the third prici-
est in Europe, fetching rents of
$1,239 a foot a year, according
to Cushman & Wakefield.
Italy’s strong tourism sec-
tor also is helping drive up re-
tail rents in other cities. Thor-
oughfares in Rome, Florence
and Venice also hold spots on
the list of most-expensive re-
tail locations in Europe by
Cushman & Wakefield, giving
Italy the distinction of being
the only country with more
than one city on the list.
Davide Dalmiglio, head of
capital markets for real-estate
services firm JLL in Italy, said
Milan has also been helped by
a pro-business administration
that has made it easier for
companies to do business in
the city.
The city has laid out a mas-
ter plan so companies know
what to expect, and there have
been significant improvements
in infrastructure.
One new metro line has
been added in recent years
and there are planned expan-
sions to others.
“There is just a mentality of
improvement and it is helping
everything,” said Mr. Dal-
miglio. He added that a decade
ago, there were five major
streets coveted by retail-
ers. Now, there are about 15,
he said. “There is more de-
mand,” said Mr. Dalmiglio.
Family Firms Go It Alone on Deals
Hines and Catella
clans get back in the
game in buying and
developing properties
BY PETER GRANT
Less than two years since
the breakup of their Italian
real-estate partnership, the
Hines family of Texas and the
Catella family of Tuscany are
separately succeeding in rais-
ing capital for a new round of
deals.
Despite Italy’s rough invest-
ment climate and political un-
certainty, the Catella family’s
company, Coima, has raised
and invested €1 billion, or $1.1
billion, in equity since the sep-
aration through a group of
funds and Italy’s first new
real-estate investment trust
since the downturn. Coima
also is an active developer
with more than €500 million
in projects under way, such as
a César Pelli-designed mixed-
use tower in Milan.
“We’ve been able to raise
significant equity from global
investors,” said Manfredi Ca-
tella, Coima’s chief executive,
in a recent interview.
Houston-based Hines, one
of the world’s most active de-
velopers and investors, also
has been busy since the firm
essentially rebooted itself in
the fall of 2015 after selling
Coima its stake in the venture
they jointly owned. In the past
year, the firm has invested
more than €700 million in
seven properties.
Even as Italy copes with an
ailing banking industry and
the aftermath of last Decem-
ber’s failed constitutional ref-
erendum that led to the resig-
nation of Prime Minister
Matteo Renzi, the deals and
capital raising show the coun-
try remains attractive to inter-
national investors, especially
those with a record of profits
in the country.
A shopping center in Gravellona Toce owned by H.I.G. Capital, which bought the mall in January.
Investors Turn Up the Heat
BY ART PATNAUDE
Sales of commercial real es-
tate in Italy hit a nine-year
high in 2016, driven by inves-
tors looking outside of Eu-
rope’s biggest property mar-
kets for higher returns.
Property transaction vol-
umes in Italy reached €9.1 bil-
lion ($9.7 billion) last year,
topping the €8 billion in 2015
and the highest level since the
€10.4 billion peak in 2007, ac-
cording to real-estate services
firm CBRE Group Inc. The in-
creased demand has helped
boost values of the most
sought-after types of property
in top cities, like stores in Mi-
lan’s most fashionable shop-
ping districts.
The size of the market in It-
aly remains small compared
with the rest of Europe. While
the Italian economy is the
fourth biggest on the Conti-
nent, it accounted for just 4%
of the €251 billion of property
traded in Europe last year,
CBRE said. Sweden, a much
smaller economy, made up
about 7% of the total.
Still, the increasing deal ac-
tivity in Italy reflects a shift
by some investors away from
Europe’s biggest markets. Fol-
lowing the 2008 financial cri-
sis, investors in Europe first
set their sights on the U.K.,
Germany and France, and later
turned to countries like Spain
The Coima-Hines venture, which endured for 25 years, was known for development of the Porta Nuova complex in Milan, above.
“A variety of capital sources
are very keen on Italy,” said
Lars Huber, chief executive of
Hines Europe, in a recent in-
terview.
The flow of capital into It-
aly “supports the thesis that
you can have good investment
opportunity even within a
pretty poor macroeconomic
backdrop,” said Peter Papada-
kos, analyst with Green Street
Advisors, a research and advi-
sory firm.
The partnership of Hines
and Coima, which spanned a
quarter-century, is at the heart
of the evolution of Italy’s mod-
ern commercial property in-
dustry.
They are best known for the
Porta Nuova development in
Milan, a sprawling business
district that is compared with
Paris’s La Defense. And Milan
continues to attract much of
and Ireland.
But after years of strong
demand pushing up values in
those markets, investors have
been looking further afield.
For instance, U.K. transaction
volumes were nearly halved in
2016 from the year earlier,
while deals in Germany fell
about 27%, according to deal
tracker Real Capital Analytics.
Italy attracted a few U.S.
private-equity investors and
major global players like
Houston-based Hines in the
early postcrisis years. But
lately they have been joined by
others. Last year “marked the
return of cross-border and do-
mestic institutional investors,”
said Jos Tromp, head of EMEA
research at CBRE.
Yields for prime retail prop-
erty in Milan averaged 3.25%
in the fourth quarter of 2016,
compared with 2.25% in cen-
tral London and 2.85% in
Paris, CBRE data show.
Investing in Italy “is a way
to move up the risk curve and
deliver returns promised to in-
vestors,” said Mahbod Nia,
chief executive at North-
Star Realty Europe Corp., a
U.S. real-estate investment
trust. NorthStar, which fo-
cuses on the U.K., Germany
and France, sold two proper-
ties in Italy last year.
Strong demand has started
to push prices higher and ini-
tial returns lower for buyers.
Coima’s and Hines’s attention.
“It is the real winner in It-
aly,” said Mr. Papadakos.
The partnership was
launched more than 15 years
ago by Gerald Hines, founder
of the Texas firm, and Ric-
cardo Catella, Manfredi’s fa-
ther, who started Coima in
1974. They were soon joined
by Manfredi, who became
head of the venture, named
Hines Italy SGR, after Ric-
cardo’s death in 2004.
Hines Italy emerged as one
of the country’s leading devel-
opers as Porta Nuova started
taking shape in the middle
part of the last decade near
Milan’s Garibaldi train station.
The project expanded to in-
clude more than 25 buildings
with 25.8 million square feet
of office space, hundreds of
apartments and a wide range
of other space and amenities.
H.I.G. CAPITAL
Prime office yields in Milan
were 3.75% in the fourth quar-
ter of last year, down from 5%
in the same period two years
earlier, CBRE data show.
Peter Papadakos, an analyst
with Green Street Advisors,
estimated that yields for top
quality property in Italy have
fallen 0.25 to 0.5 percentage
point in the past year. Falling
yields are a sign that prices
are rising.
“Even with what we’ve all
read about the Italian banking
system, there is availability of
credit from Italian banks at
spreads that are very reason-
able,” Mr. Papadakos said.
“There’s nothing that’s indi-
cating the market is freezing.
There’s nothing that’s indicat-
ing that volume is drying up.”
Investors caution that many
of the perennial problems with
investing in Italy remain.
These include poor transpar-
ency, low liquidity, political
uncertainty and weak eco-
nomic growth.
“It’s not one of those mar-
kets where one can autopilot a
deal from abroad,” said Ric-
cardo Dallolio, a managing di-
rector at Miami-based pri-
vate-equity firm H.I.G. Capital
LLC. H.I.G. in January bought
an office building in a Milan
suburb and a shopping mall
about 55 miles away. The com-
pany didn’t disclose what it
paid.
THE WALL STREET JOURNAL.
Porta Nuova’s timing wasn’t
great. Italy was still reeling
from the financial crisis as the
developers began delivering
space, raising questions
among some whether the de-
velopment could be headed for
big problems.
“We went through very
tough years,” Mr. Catella said.
But, thanks in part to the
dearth of modern office space
in Italy, the project began at-
tracting some of the biggest
companies in the city, includ-
ing UniCredit SpA, Nike Inc.
and Samsung Electronics Co.
Today, Porta Nuova’s office
space is close to 100% occu-
pied and it is owned by the
Qatar Investment Authority.
Executives in both the
Coima and Hines camps say
that they decided to break up
the partnership, which con-
trolled more than €2 billion in
Lenders Chip Away
At Distressed Loans
BY GIOVANNI LEGORANO
ROME—Italian banks are
speeding up the sale of dis-
tressed loans backed by real
estate, an effort to mend bal-
ance sheets weakened by
enormous piles of debt.
But the banks still have a
long way to go. For many
loans, they are assigning a
higher value than what buyers
are willing to pay, meaning
that the process of unloading
bad debt is likely to remain
drawn out.
Bolstering the outlook are
signs that Italy is coming out
of a property slump, which
would make it easier to sell
more distressed loans. Italy is
lagging behind the U.S. and
some other European nations,
where recoveries in property
values have been strong.
“Last year was the real
turning point for bad real-es-
tate loans,” said Andrea Mig-
nanelli, chief executive of
Cerved Credit Management
Group SpA, a debt-services
firm.
To be sure, banks still own
€200 billion ($214 billion) of
the most toxic type of loan, in
which the borrowers are con-
sidered insolvent. That is 9%
more than in 2014, as more
property owners default.
There are nascent signs of
improvement, however. Italian
banks sold €1.4 billion in bad
loans backed by real estate in
2016, seven times the value
they unloaded two years be-
fore.
In addition, they shed €6.7
billion of secured and unse-
Intesa Sanpaolo uses a separate company that bids at auctions
of properties backing bad loans to put a floor under prices.
MAIRO CINQUETTI/PACIFIC PRESS/ZUMA PRESS
assets, because of differences
over strategy and risk appe-
tite. Manfredi Catella wanted
to maintain a development
arm and to tap Italy’s stock
market with an initial public
offering, according to the ex-
ecutives.
Houston-based Hines wasn’t
interested in an IPO and
wanted to focus on privately
funded real-estate investments
and a more conservative strat-
egy of buying existing prop-
erty, according to Hines execu-
tives.
After selling Coima its stake
in the partnership, Hines set
about rebuilding its operations
in the country.
Meanwhile, Coima is focus-
ing on buying property
through its real-estate invest-
ment trust and on develop-
ment deals through its asset-
management arm.
cured nonperforming loans
last year, compared with €1.8
billion in 2014, according to
the latest data from Pricewa-
terhouseCoopers.
While deal volume remains
small compared with the total
value of bad loans—those
backed by real estate and
those that aren’t—market par-
ticipants say they are encour-
aged. PwC said it expects Ital-
ian banks to sell at least €50
billion of loans this year, com-
pared with €14 billion in 2016.
UniCredit SpA said in De-
cember that it would shed €18
billion of its €77 billion in bad
loans by bundling them into
securities to be sold to inves-
tors by the end of the first
half. Banca Monte dei Paschi
di Siena SpA plans to sell the
entire portfolio of its most
toxic loans, valued at €28 bil-
lion, in one go.
Italy’s banking system has
lagged behind those of other
countries, such as Ireland and
Spain, in dealing with bad
loans, in particular those
backed by real estate. That has
created a big drag on the
economy.
Part of the reason is that
property values in Italy have
stayed stubbornly low while
markets in other countries re-
covered.
Some banks are learning to
better manage the properties
underlying the bad loans.
Intesa Sanpaolo SpA cre-
ated a separate company that
bids at auctions of properties
backing distressed loans as a
way of putting a floor under
prices.
ALESSIA PIERDOMENICO/BLOOMBERG NEWS
THE WALL STREET JOURNAL. Wednesday, February 1, 2017 | B9

BANKING & FINANCE

Robo-Advisory Firm Banks Ramp Up Vendor Security

Adds the Human Touch BY ROBIN SIDEL

BY ANNE TERGESEN Schwab Corp. announced a It is getting harder to do

new hybrid robo-advisory ser-
Robo adviser pioneer Bet- vice that will launch later this
terment LLC is joining the in- year and exist alongside the
dustry’s rapidly expanding company’s Intelligent Portfo-
trend of offering hybrid ser- lios, the purely robo service it
vices that pair computerized launched in June 2015 that
financial advice with human now has $12.3 billion in assets.
help. A number of other big finan-
Betterment, founded in cial-services companies—in-
2010, is one of a handful of cluding Morgan Stanley and
startups that put the robo-ad- Bank of America Corp.’s Mer-
visory industry on the map by rill Lynch—have recently an-
providing automated portfo- nounced plans to offer auto-
lios of low-cost exchange- mated investment services,
traded funds, mainly to youn- most of which include advis-
ger clients. While the company ers.
business with banks.
Stung by cyberattacks, fi-
nancial institutions are crack-
ing down on security practices
at thousands of vendors, from
those that store critical finan-
cial data to food-services com-
panies that post weekly lunch
menus on a bank’s internal
website.
This more-stringent review
of business relationships is
leading to heightened tension
between banks, which are try-
ing to ensure the safety of
their operations, and their

TOMOHIRO OHSUMI/GETTY IMAGES

will continue to offer its purely The industry is dominated outside contractors, which are
automated service for a fee of by Vanguard Group’s Personal being pummeled with de-
0.25% of assets a year, it is Advisor Services, a hybrid fi- mands for information before
now giving clients—whose nancial-planning and investing they even win a potential cli-
ranks number 210,000—the service launched in May 2015 ent’s business.
option to hire a human adviser that now has more than $52 Financial institutions are
for an additional annual fee of billion in assets. spending billions of dollars on
0.15% to 0.25% of assets. Among the original pure their own cybersecurity prac-
The New York-based com- robo firms, only Wealthfront tices in an effort to thwart
pany’s goal is to give prospec- Inc. remains all digital. A hackers. But the focus on ven- Participants competed in an international cybersecurity contest in Tokyo on Saturday.
tive customers who want more spokeswoman for the Redwood dors has intensified since Tar-
hand-holding that option and City, Calif., firm, which man- get Corp. discovered three Representatives of several review Pershing’s organiza- companies can use to assess
to equip itself to serve existing ages $5 billion of assets, said it years ago that hackers broke big banks declined to discuss tional charts, firewalls and cybersecurity risk, and tech-
customers whose needs be- has no plans to introduce a hy- into its computer network by their cybersecurity programs. even its employee-fingerprint nology consulting firms are
come more complex as they brid service. stealing the login credentials Regulators such as the Of- cards. also trying to develop their
age. With its new offering, Bet- of a heating-and-air condition- fice of the Comptroller of the Such questionnaires are one own versions.
Betterment Chief Executive terment will compete more di- ing contractor. The hackers Currency and the Consumer area of concern between banks “Companies that are low-
Jon Stein said he expects the rectly with firms such as went on to steal 40 million Financial Protection Bureau and vendors, executives say. It risk are being asked to answer
new hybrid service to allow Schwab and Fidelity Invest- credit-card and debit-card have also ordered banks to isn’t unusual for them to con- 500 to 1,000 questions even
the firm to expand at about ments. numbers. tighten oversight of third- tain hundreds of questions, though you know the company
twice its current rate. In 2016, “It is definitely creating a party relationships. They are and some have run into the asking isn’t doing much with
the firm’s assets under man- bit of tension because differ- also holding banks’ boards ac- thousands. the information,” said Cal
agement increased from $3.2 ent customers are asking the countable for overseeing ven- “It is definitely a challenge, Slemp, managing director at
billion to $7 billion. “We were vendors to adhere to all kinds dor risks, according to guide- and I don’t see it getting any Protiviti Inc., which works
hearing from new customers of different requirements from lines issued by the regulators. better. I see it getting worse,” with banks and vendors on the
who were coming to us and a security perspective,” said “Whatever controls we pro- Jodi Pinedo, director and se- issue.
checking us out but weren’t Sumedh Thakar, chief product vide internally, we have to nior managing counsel at Per- Another area of tension in-
sure if it was right for them officer at Qualys Inc. make sure the third party also shing LLC, a unit of Bank of volves banks that want to con-
without someone to talk to,” The company, which pro- follows,” said an executive at a New York Mellon Corp., said at duct physical audits of vendor
said Mr. Stein. vides cloud-based security ser- big bank. a cybersecurity conference facilities. The problem: Ven-
In offering a human option, vices to firms and counts But vendors said that some last year. dors may store data from mul-
MICHAEL NAGLE/BLOOMBERG NEWS

Betterment is following in the banks as its customers, has institutions are going too far, Federal agencies are trying tiple firms in the same loca-
footsteps of more traditional added employees to manage deluging them with questions to streamline the process. The tion, increasing the chance
wealth-management rivals that the process for clients asking about their practices, employ- Federal Financial Institutions that the wrong data could be
have added human advisers to for information about workers. ees and physical facilities. Examination Council, an inter- inadvertently exposed.
robo offerings to assist cus- A bank can use hundreds of Pershing LLC, which pro- agency government body that “It is fine when it’s one cus-
tomers with financial planning, vendors that have wide ranges vides clearing and settlement includes five regulators, has tomer, but when we are deal-
a process that includes setting of access to a bank’s informa- services and other assistance issued guidelines to help ing with a bunch of them, it
long-term financial goals and tion and computer systems, al- to banks, has been besieged banks assess vendor risk. becomes a huge labor problem
figuring out how much to save though some third-party pro- with lengthy questionnaires A technology industry or- on our side,” said Justin So-
and in what accounts. CEO Jon Stein says the hybrid viders don’t have any access from potential clients. ganization has crafted a stan- maini, chief security officer at
In December, Charles service will allow rapid growth. to a bank’s network. Some banks also want to dardized questionnaire that software provider SAP SE.

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B10 | Wednesday, February 1, 2017 THE WALL STREET JOURNAL.

MUTUAL FUNDS
WSJ.com/fundresearch

Net YTD Net YTD Net YTD Net YTD Net YTD Net YTD Net YTD
Explanatory Notes Data provided by
Fund NAV Chg %Ret Fund NAV Chg %Ret Fund NAV Chg %Ret Fund NAV Chg %Ret Fund NAV Chg %Ret Fund NAV Chg %Ret Fund NAV Chg %Ret
TotalBond 10.55 +0.01 0.5 ShtDurIncmA p 4.31 ... 0.3 IntlStk 15.91 Tweedy Browne Fds
+0.02 4.1 MuShtAdml 15.75 ... 0.3 LifeGro 29.49 +0.04 2.1 VANGUARD INSTL FDS
Top 250 mutual-funds listings for Nasdaq-published share classes with net assets of
at least $500 million each. NAV is net asset value. Percentage performance figures Fidelity Selects Lord Abbett F MCapGro 77.90 GblValue
+0.25 3.4 25.33 -0.03 1.2 PrmcpAdml r 112.22 -0.03 3.1 LifeMod 24.54 +0.03 1.6 BalInst 31.51 +0.03 1.3
are total returns, assuming reinvestment of all distributions and after subtracting Biotech r 185.01 +5.92 6.3 ShtDurIncm 4.31 ... 0.5 MCapVal 29.35 +0.16 1.0 REITAdml r 116.83 +0.88 ... PrmcpCor 22.84 ... 3.0 DevMktsIndInst 12.18 +0.03 3.7
annual expenses. Figures don’t reflect sales charges (“loads”) or redemption fees. First Eagle Funds N Horiz 45.19 +0.31 4.3 V SmCapAdml 62.74 +0.34 1.6 SelValu r 29.57 +0.04 2.7 ExtndInst 74.27 +0.41 2.1
NET CHG is change in NAV from previous trading day. YTD%RET is year-to-date GlbA 55.73 +0.02 2.7 M N Inc 9.38 VANGUARD ADMIRAL
+0.01 0.3 STBondAdml 10.44 +0.01 0.2 STAR 24.18 +0.02 2.1 GrwthInst 59.41 ... 3.7
return. 3-YR%RET is trailing three-year return annualized. FPA Funds Metropolitan West OverS SF r 9.42 500Adml
+0.03 3.9 210.48 -0.18 1.9 STIGradeAdml 10.65 ... 0.3 STIGrade 10.65 ... 0.3 InPrSeIn 10.48 +0.02 1.0
FPACres NA ... NA TotRetBd 10.54 +0.01 0.1 R2015 14.42 BalAdml
+0.02 1.7 31.50 +0.02 1.3 TotBdAdml 10.66 +0.02 0.3 TgtRe2015 14.69 +0.02 1.2 InstIdx 207.69 -0.18 1.9
e-Ex-distribution. f-Previous day’s quotation. g-Footnotes x and s apply. j-Footnotes e
FrankTemp/Frank Adv TotRetBdI 10.54 +0.01 0.3 R2020 20.82 CAITAdml
+0.02 2.0 11.57 +0.01 0.6 TotIntBdIdxAdm 21.46 +0.01 -0.9 TgtRe2020 28.69 +0.04 1.5 InstPlus 207.70 -0.19 1.9
and s apply. k-Recalculated by Lipper, using updated data. p-Distribution costs apply,
IncomeAdv 2.31 +0.01 1.3 TRBdPlan 9.92 +0.01 0.3 R2025 15.85 CapOpAdml r 128.84 +0.12 3.7 TotIntlAdmIdx r 25.60
+0.02 2.3 +0.05 3.9 TgtRe2025 16.63 +0.02 1.7 InstTStPlus 51.31 +0.02 1.9
12b-1. r-Redemption charge may apply. s-Stock split or dividend. t-Footnotes p and r
apply. v-Footnotes x and e apply. x-Ex-dividend. z-Footnote x, e and s apply. NA-Not FrankTemp/Franklin A MFS Funds Class A R2030 23.08 EMAdmr
+0.02 2.4 31.25 -0.07 4.9 TotStAdml 57.16 +0.02 1.9 TgtRe2030 29.77 +0.04 2.0 MidCpInst 37.07 +0.08 3.0
available due to incomplete price, performance or cost data. NE-Not released by Lipper; CA TF A p 7.33 ... 0.4 ValueA p 36.47 -0.05 1.2 R2035 16.72 EqIncAdml
+0.02 2.6 68.76 -0.07 0.6 TxMIn r 12.17 +0.04 3.7 TgtRe2035 18.12 +0.02 2.1 MidCpIstPl 182.81 +0.40 3.0
data under review. NN-Fund not tracked. NS-Fund didn’t exist at start of period. Fed TF A p 12.03 ... 0.5 MFS Funds Class I R2040 23.86 ExtndAdml
+0.03 2.8 74.27 +0.41 2.1 ValAdml 36.46 -0.04 0.6 TgtRe2040 30.92 +0.03 2.4
SmCapInst 62.74 +0.34 1.6
IncomeA p ValueI 36.67 -0.05 1.2 SmCapStk GNMAAdml 10.51 +0.01 -0.1 WdsrllAdml 63.05 -0.02 1.1 TgtRe2045 19.35 +0.02 2.4
2.32 ... 0.9 45.50 +0.25 1.3 STIGradeInst 10.65 ... 0.4
RisDv A p 53.08 -0.11 0.9 Mutual Series GrwthAdml 59.40 -0.01 3.6 WellsIAdml 61.88 +0.05 0.3 TgtRe2050 31.13 +0.04 2.4
Tuesday, January 31, 2017 SmCapVal 44.99 +0.15 -0.3 TotBdInst 10.66 +0.02 0.3
GlbDiscA 31.02 -0.02 1.5 Value HlthCareAdml r 80.09 +1.18 2.8 WelltnAdml 68.08 -0.05 0.9 TgtRetInc 12.92 +0.02 0.9
Net YTD Net YTD Net YTD FrankTemp/Franklin C 34.04 +0.06 1.2 TotBdInst2 10.62 +0.02 0.3
GlbDiscz 31.59 -0.02 1.5 Prudential Cl HYCorAdml r 5.86 ... 1.0 WndsrAdml 70.40 -0.05 1.7 TotIntBdIxInv 10.73 ... -0.9
Fund NAV Chg %Ret Fund NAV Chg %Ret Fund NAV Chg %Ret Income C t 2.35 ... 1.2 Z&I TotBdInstPl 10.66 +0.02 0.3
InfProAd 25.73 +0.05 1.0 VANGUARD FDS WellsI 25.54 +0.02 0.3
FrankTemp/Temp A TRBdZ 14.12
+0.02 0.5 TotIntBdIdxInst 32.20 +0.01 -0.9
A HiYldBd 7.70 -0.01 1.3 ExtMktIdxPrem r 56.72 +0.32 2.1
GlBond A p 11.93 -0.11 -0.4
O IntlGrAdml 72.24 +0.21 7.3 DivdGro 23.72 -0.05 1.2 Welltn 39.42 -0.03 0.9
TotIntlInstIdx r102.38 +0.21 3.9
StratIncOpptyIns 9.87 ... 0.6 IntlIdxPrem r 36.46 +0.10 3.2 ITBondAdml 11.26 +0.03 0.4 GNMA 10.51 +0.01 -0.1 WndsrII 35.53 -0.01 1.1
American Funds Cl A TMktIdxF r 65.78 +0.02 1.9 Growth A p 24.11 +0.01 2.3 Oakmark Funds Cl I S ITIGradeAdml 9.66 +0.01 0.4 HlthCare r 189.88 +2.79 2.8 VANGUARD INDEX FDS TotItlInstPlId r102.40 +0.21 3.9
EqtyInc r 30.99 +0.03 1.9
AmcpA p 28.14 -0.01 3.3 D TMktIdxPrem 65.78 +0.02 1.9 FrankTemp/Temp Adv
Oakmark 73.42 -0.23 1.3
Schwab Funds LTGradeAdml 10.06 +0.04 0.3 INSTTRF2020 20.44 +0.02 1.5 500 210.46 -0.19 1.9 TotStInst 57.16 +0.01 1.9
AMutlA p 37.36 ... 1.4 USBdIdxPrem 11.49 +0.01 0.2 GlBondAdv p 11.88 -0.12 -0.4 S&P Sel 35.07 -0.03 1.9 MidCpAdml 167.80 +0.37 3.0 INSTTRF2025 20.45 +0.02 1.7 ExtndIstPl 183.29 +1.02 2.1 ValueInst 36.46 -0.04 0.6
Del Invest Instl OakmrkInt 23.64 +0.03 4.1
BalA p 25.26 ... 1.8 19.64 +0.04 -0.2 USBdIdxInstPrem 11.49 +0.01 0.2 MuHYAdml 11.03 +0.01 0.5 INSTTRF2030 20.44 +0.03 1.9 SmValAdml 52.32 +0.21 0.7
BondA p 12.76 +0.02 0.5
Value
Fidelity Advisor I
H Old Westbury Fds T MuIntAdml 13.93 +0.01 0.5 INSTTRF2035 20.43 +0.03 2.2 TotBd2 10.62 +0.02 0.3
W
Dimensional Fds LrgCpStr 13.09 -0.02 2.0
CapIBA p 58.32 +0.10 1.2 5GlbFxdInc 10.90 +0.01 0.3 NwInsghtI 27.90 -0.04 3.5 Harbor Funds TIAA/CREF Funds MuLTAdml 11.39 +0.01 0.4 INSTTRF2040 20.41 +0.02 2.4 TotIntl 15.30 +0.03 3.9 Western Asset
CapApInst Oppenheimer Y
CapWGrA 45.17 -0.03 3.1 EmgMktVa 25.46 -0.06 6.3 Fidelity Freedom 59.15 -0.16 4.4 EqIdxInst 16.90 ... 1.9 MuLtdAdml 10.89 +0.01 0.6 LifeCon 18.64 +0.03 1.1 TotSt 57.13 +0.02 1.9 CorePlusBdI NA ... NA
DevMktY 33.56 -0.13 5.0
EupacA p 47.10 -0.07 4.4 EmMktCorEq 18.42 -0.02 6.1 FF2020 15.28 +0.02 1.9 IntlInst r 60.50 +0.17 3.6
IntGrowY 35.52 +0.18 2.4
FdInvA p 56.00 -0.12 2.9 IntlCoreEq 12.13 +0.05 4.0 FF2025 13.11 +0.02 2.0
GwthA p 43.95 -0.05 4.5 IntSmCo 17.99 +0.10 4.2 FF2030 16.17 +0.02 2.4 I P
HI TrA p
ICAA p
10.36 ...
37.22 -0.04
1.4
2.7
IntSmVa
US CoreEq1 19.61
19.84 +0.06 4.3
... 1.8
FreedomK2020
FreedomK2025
14.23
14.89
+0.02 1.9 Invesco Funds A
+0.02 2.1 EqIncA 10.63 ... 0.7
Parnassus Fds Dividend Changes
FreedomK2030 15.24 +0.02 2.4 ParnEqFd 40.07 -0.04 2.0
IncoA p 21.95 ... 1.3 US CoreEq2 18.89 +0.01 1.5
N PerA p 36.87 -0.05 4.4 FreedomK2035 15.82 +0.02 2.6 J PIMCO Fds Instl Dividend announcements from January 31.
US Small 33.84 +0.17 ... AllAsset NA ... NA
NEcoA p 37.77 +0.09 5.1 FreedomK2040 15.85 +0.03 2.7 John Hancock Class 1
US SmCpVal 37.19 +0.14 -0.5 HiYld 8.87 -0.01 1.1 Amount Payable / Amount Payable /
NwWrldA 54.08 -0.12 5.1 Fidelity Invest LSBalncd 14.52 +0.01 2.0 TotRt
US TgdVal 24.05 +0.05 0.2 10.08 ... 0.7 Company Symbol Yld % New/Old Frq Record Company Symbol Yld % New/Old Frq Record
SmCpA p Balanc 22.46 +0.02 2.0 LSGwth 15.06 +0.01 2.4 PIMCO Funds A
47.83 +0.22 4.0 USLgVa 35.60 -0.04 1.5
TxExA p 12.75 ... 0.3 Dodge & Cox
BluCh 70.62 ... 4.8 John Hancock Instl Increased Stocks
Contra 102.76 -0.21 4.4 IncomeFd NA ... NA
WshA p 41.50 -0.08 1.3 Balanced 105.18 +0.07 1.8 ContraK DispValMCI 21.97 +0.05 2.3 PIMCO Funds D Berkshire Hills Bancorp BHLB 2.4 .21 /.20 Q Mar02 /Feb16 ReneSola ADR SOL 1:5 /Feb10
102.69 -0.20 4.4
... NA Meredith Corp 3.4 .52 /.495 Mar15 /Feb28
AMG Managers Funds Income 13.64 +0.02 0.4 CpInc r JPMorgan Funds MDP Q
9.91 -0.01 2.4 IncomeFd NA
YacktmanFd I 22.09 -0.02 3.3 Intl Stk 39.74 -0.12 4.3 DivIntl 34.30 +0.09 3.0
MdCpVal L 36.93 +0.13 1.5 PIMCO Funds Instl North Eur Oil Royalty Tr NRT 8.7 .15 /.12 Q Feb22 /Feb17 Foreign
Stock 188.50 +0.07 2.3 DivIntlK r JPMorgan R Class IncomeFd NA ... NA Principal Financial Group PFG 3.2 .45 /.43 Q Mar31 /Mar06 DHT Holdings DHT 6.8 .08 Q Feb22 /Feb14
B DoubleLine Funds
34.22 +0.08 3.0
CoreBond 11.51 +0.02 0.3 PIMCO Funds P Sound Financial Bancorp SFBC 1.4 .10 /.075 Q Feb27 /Feb13
GroCo 142.66 +0.43 4.3 INVESCO IVZ 3.9 .28 Q Mar03 /Feb16
Baird Funds TotRetBdI NA ... NA GrowCoK 142.51 +0.42 4.3
JPMorgan Select Cls IncomeP NA ... NA U.S. Lime & Minerals USLM 0.7 .135 /.125 Q Mar17 /Feb24
Santander Fin FR Sers 6 SANpB 4.2 .25278 Q Mar06 /Feb19
AggBdInst 10.72 +0.02 0.3 TotRetBdN NA ... NA InvGB 7.81 +0.01 0.5 CoreBond 11.50 +0.02 0.4 Price Funds
Funds and investment companies Seadrill Partners SDLP 9.9 .10 Q Feb14 /Feb07
CorBdInst 11.05 +0.01 0.4 InvGrBd 11.12 +0.02 0.5 USLgCpCorPls 28.94 -0.06 2.9 BlChip 76.14 -0.12 4.9
BlackRock Funds A F LowP r 50.06 +0.18 1.2 CapApp 26.66 +0.08 1.8 DE Enhncd Glbl Div Inco DEX 6.0 .0525 M Feb24 /Feb10 UBS Group UBS 3.7 .60036 A May10 /
GlblAlloc p 18.50 +0.02 1.8 Federated Instl LowPriStkK r 50.02 +0.18 1.2
L EqInc 31.54 -0.06 0.2 Delaware Grp Div & Income DDF 4.8 .04 M Feb24 /Feb10 Unilever ADR UN 3.4 .3439 Q Mar15 /Feb10
BlackRock Funds C StraValDivIS 5.94 +0.04 0.6 MagIn 93.56 -0.12 2.4 Lazard Instl EqIndex 61.23 -0.05 1.9 Delaware Invest Colo VCF 4.9 .06 M Feb24 /Feb10 Unilever ADR UL 3.3 .3439 Q Mar15 /Feb10
GlblAlloc t 16.83 +0.02 1.7 Fidelity OTC 88.07 +0.48 5.7 EmgMktEq 16.75 -0.07 4.9 Growth 55.90 -0.12 5.0 Delaware Invest Minn VMM 4.1 .0475 M Feb24 /Feb10
BlackRock Funds Inst 500IdxInst 79.83 -0.07 1.9 Puritn 21.06 ... 2.3 Loomis Sayles Fds HelSci 61.98 +1.22 4.9 Delaware Invest Ntl Muni VFL 5.0 .055 M Feb24 /Feb10
EqtyDivd 22.57 -0.04 0.1 500IdxInstPrem 79.83 -0.07 1.9 SrsEmrgMktF 16.76 -0.01 6.5 LSBondI 13.81 +0.02 2.1 InstlCapG 30.80 -0.04 5.3 Franklin Liberty Invt Grd FLCO 3.4 .06764 M Feb07 /Feb02 KEY: A: annual; c: corrected; M: monthly; Q: quarterly; r: revised; SA:
GlblAlloc 18.60 +0.02 1.8 500IdxPrem 79.83 -0.07 1.9 SrsInvGrdF 11.13 +0.02 0.5 Lord Abbett A IntlValEq 13.13 +0.03 2.5 Franklin Short Dur US FTSD 1.3 .10477 M Feb06 /Feb02 semiannual; S2:1: stock split and ratio; SO: spin-off.

New Highs and Lows | WSJ.com/newhighs Stock

52-Wk %
Sym Hi/Lo Chg Stock
52-Wk %
Sym Hi/Lo Chg Stock
52-Wk %
Sym Hi/Lo Chg Stock
52-Wk %
Sym Hi/Lo Chg Stock
52-Wk %
Sym Hi/Lo Chg Stock
52-Wk %
Sym Hi/Lo Chg
VailResorts MTN 172.32 0.6 QuantUSMktNeut CHEP 27.48 -0.8 AxoGen AXGN 11.00 6.3 IPG Photonics IPGP 115.20 1.2 SonomaPharmWt SNOAW 0.55 5.0 GlobalEagle ENT 5.90 -0.3
The following explanations apply to the New York Stock Exchange, NYSE Arca, NYSE MKT and WestlakeChemPtrs WLKP 25.80 -0.2 SPDRBloomBarc0-5Y SIPE 19.96 0.2 B.RileyNts2021 RILYL 26.58 ... iRhythmTechs IRTC 32.84 3.8 StoneCastleFin BANX 19.90 1.1 GreatElmCap GEC 3.35 -2.9
Nasdaq Stock Market stocks that hit a new 52-week intraday high or low in the latest session. Zoetis ZTS 54.97 1.2 SPDRBofAMLCrsOvCp CJNK 27.40 0.3 Bioverativ BIVVV 49.00 2.3 iSectorsPostMPT PMPT 25.30 3.4 SynergyPharm SGYP 7.15 8.1 IdealPower IPWR 2.00 -3.8
% CHG-Daily percentage change from the previous trading session. SPDRLgDollarGold GLDW 120.25 0.4 BlueknightEner BKEP 7.55 2.8 LHC Group LHCG 50.23 6.7 SynutraIntl SYUT 5.88 ... Innocoll INNL 0.56 -2.2
NYSE lows - 19 SPDRRuss1000Mom ONEO 68.94 0.5 BofI BOFI
BLVDW
30.60 4.0 Lantronix
0.65 8.3 LawsonProducts
LTRX
LAWS
2.43
26.10
10.3
5.3
TESARO
Transcat
TSRO
TRNS
163.78
12.05
6.1
9.7
InsigniaSystems ISIG 1.53 -1.3
Tuesday, January 31, 2017 VanEckInvtGrFR FLTR 25.36 -0.1 BoulevardAcqnIIWt InternetGold IGLD 10.04 2.2
Abercrombie&Fitch ANF 10.91 3.0 TriCoBancshares TCBK 37.00 7.1
CBOE Holdings CBOE 79.76 2.2 LibertyGlobal A LBTYA 36.78 -0.4 JA Solar JASO 4.42 1.1
52-Wk % 52-Wk % 52-Wk % AdeptusHealth ADPT 6.87 -1.1
Stock Sym Hi/Lo Chg Stock Sym Hi/Lo Chg Stock Sym Hi/Lo Chg CGG CGG 10.06 -4.9 NYSE Arca lows - 5 CDK
CF
Global CDK
CFCO
62.63 0.6 MMACapitalMgmt
10.02 0.3 MakeMyTrip
MMAC
MMYT
22.36
34.20
0.5
2.1
UtdCmntyBcp
UnitedTherap
UCBA
UTHR
17.10
163.99
1.8
2.5
Jamba
JounceTherap
JMBA
JNCE
9.08
16.33
-1.5
-2.5
Cato CATO 24.82 -0.4 DirexionConStpBr1 SPLZ 24.75 -1.2 UplandSoftware UPLD 12.25 2.0
EatonVanceSrInc EVF 6.81 ... NuvGlblHiIncmFd JGH 16.44 0.1 Ciber CalamosConvOp CHI 10.82 0.9 MarketAxess MKTX 188.87 3.3 LM Funding Wt LMFAW 0.11 -20.4
CBR 0.42 -12.0 FranklinIntlEquity FLQH 23.35 -0.7
NYSE highs - 72 EtnVncTxAdvDiv EVT
EmpresaDisCom EDN
21.69 0.8
34.54 7.6
NuvShrtDurCrOppFd JSD
OldRepublic ORI
18.22 0.2 ColonyNrthStPfA CLNSpA 25.31 -0.1
20.94 1.0 Express
JPMDivRetEurCur JPEH 24.74 -1.0
CalamosStratTot
CaraTherap
CSQ
CARA
10.88 1.2 MarlinBusSvcs
15.68 8.0 Masimo
MRLN
MASI
22.95
73.72
2.9
2.5
VarexImaging VREX
WayneSavings WAYN
29.23
18.01
5.4
0.5
LRAD
LeapTherap
LRAD
LPTX
1.43
6.10
-4.5
-12.0
EXPR 9.91 4.7 WisdTreeMngdFutStr WDTI 40.40 -0.3 WheelerREITPfdB WHLRP 23.48 1.5
AllyFinancial ALLY 21.14 7.3 ForestCity B FCE/B 29.23 1.5 OutfrontMedia OUT 27.64 0.1 GenAmInv pfB CarolinaBankNC CLBH 27.93 1.0 MercerIntl MERC 12.30 0.8 MedallionFin MFIN 2.17 -13.1
GAMpB 25.36 -0.3 WisdTrJpnRealEst DXJR 13.45 -0.2
Altria MO 71.44 -0.2 FIG 5.65 4.5 PIMCOCorp&Incm PTY 15.48 0.1 Infosys Cavium CAVM 66.52 0.1 Merus MRUS 27.36 5.5 MeridianWaste MRDN 2.85 -1.2
AnixterIntl AXE 88.00 5.4
FortressInvt
GasLogPartners GLOP 23.00 2.9 PIMCO IncmStrFdII PFN 9.81 0.4 Intrexon
INFY 13.58 -0.3
ChampionsOncology CSBR 4.75 11.0 Mocon MOCO 20.00 2.0 Nasdaq lows - 51 Michaels MIK 19.00 1.7
Anthem ANTM 154.97 ... Glaukos GKOS 41.42 8.3 PackagingCpAm PKG 96.87 0.4 L Brands
XON
LB
20.41 0.8
58.18 2.6
NYSE MKT highs - 4 ChanticleerWt HOTRW 0.57 101.8 MomentaPharm MNTA 19.10 25.2
AegleaBioTherap AGLE 3.66 -0.5 NantHealth NH 7.92 -1.3
AnthemUn ANTX 48.66 -0.3 Graco GGG 91.23 0.2 PampaEnergia PAM 46.58 1.9 Luby's ClovisOncology CLVS 64.90 4.8 Napco Security NSSC 9.75 5.5 NantKwest NK 4.96 3.9
LUB 3.63 -3.2 EtnVncLtdFd EVV 14.11 0.1 Amedica AMDA 0.35 -1.8
AnworthMtgPfdA ANHpA 25.93 ... GuggCreditAlloc GGM 23.88 3.1 Petrobras PZE 9.67 2.3 ReneSola CoastwayBancorp CWAY 16.75 0.6 NICE NICE 70.49 0.8 Angie'sList ANGI 6.22 -4.1 OncoSecMedical ONCS 1.11 -2.5
SOL 0.59 -2.2 ReavesUtilFd UTG 32.87 0.8
AresDynamicCredit ARDC 15.65 0.6 GuggenheimStrOp GOF 20.10 0.2 PlatformSpecialty PAH 12.19 1.2 RiteAid Datawatch DWCH 8.20 6.6 NV5Global NVEE 40.90 2.4 Apptio APTI 13.54 -2.1 PlugPower PLUG 1.02 ...
RAD 5.60 -1.7 VoltInfoSci VISI 8.74 -4.6
AtkoreIntl ATKR 27.21 0.7 HCI Group HCI 41.80 2.0 ProspectCapNt PBB 25.93 0.6 RubyTuesday EXFO EXFO 6.00 4.4 Neothetics NEOT 1.62 14.3 AscenaRetail ASNA 4.44 4.3 SITO Mobile SITO 2.05 -0.5
RT 1.88 2.6 WellsFargoIncOpp EAD 8.57 ...
BlkRkDurInco Tr BLW 15.84 0.5 HercHoldings HRI 50.22 -0.6 ReinsuranceGrp RGA 132.31 0.4 SallyBeauty ElbitSystems ESLT 110.32 1.2 NetScout NTCT 33.95 5.9 BiogenWi BIIBV 248.36 -0.1 SearsHometown SHOS 3.55 -1.4
SBH 23.19 -2.3
Brunswick BC 59.91 1.2 ElectrumSpec ELEC 9.96 -0.1 NortheastBancorp NBN 14.75 2.2 SocialReality SRAX 2.46 -15.8
CellcomIsrael CEL 10.54 1.1
HiltonGrandVac HGV
Hubbell HUBB
29.46 3.4
125.00 3.6
RoperTech
RoyalBkCanada RY
ROP 191.94 0.8 UnderArmour C UA
72.25 0.2 UnderArmour A UAA
18.52 -23.4
20.80 -25.7
NYSE MKT lows - 3 Fauquier FBSS 16.95 0.4 NovaMeasuring NVMI 15.05 2.3
COPsync
Cray
COYN
CRAY
0.46
16.10
8.0
4.6 SteinMart SMRT 3.50 1.7
CenterPointEner CNP 26.23 1.5 JELD-WEN JELD 27.26 3.9 ShawComm B SJR 21.73 0.1 VF BAA 0.13 -12.4 GilatSatellite GILT 6.18 10.4 ParagonCommercial PBNC 46.40 0.2 DicernaPharma DRNA 2.46 -4.2 Strattec STRT 30.63 -6.1
VFC 49.65 0.3 Banro
CtrlEuropeRussiaFd CEE 21.49 0.4 KB Fin KB 40.67 1.1 SnapOn SNA 181.61 ... CanFiteBiopharm CANF 1.74 -2.7 GlbPartnerAcqnWt GPACW 0.65 18.2 Park-Ohio PKOH 45.25 1.1 DimensionTherap DMTX 1.90 -54.1 Tantech TANH 1.76 -6.3
Civeo
CompassMnlInt CMP
CVEO 3.70 0.3
83.70 1.8
Kyocera KYO
MSG Networks MSGN
54.70 4.9
23.50 2.2
SouthwestGas SWX
Sprint S
80.76 2.8
9.65 1.3
NYSE Arca highs - 12 XtantMedical XTNT 0.29 -1.5 GolarLNGPartners
GreenBancorp
GMLP
GNBC
24.91 0.6 PathfinderBncp
17.25 0.9 PinnacleEnt
PBHC
PNK
14.50
15.44
1.1
2.1
DragonWave
EducDev
DRWI
EDUC
1.55
6.95
-3.0
0.7
TenaxTherap
The9
TENX
NCTY
0.42
0.94
-76.4
-8.7
CushingRenaissance SZC
Danaher DHR
18.89 1.8
84.11 4.4
Manpower
MaxLinear
MAN
MXL
97.34 0.8
25.61 1.3
TemplGlob
TItanIntl
GIM
TWI
6.68 1.1 DirexnCyberBull2X HAKK
13.39 0.6 ElemntsRogrMrngstr WMW
46.39 3.3
26.40 4.2
Nasdaq highs - 83 GulfIslandFab
HMN Fin
GIFI
HMNF
13.95 0.7 ProvidentBancorp
18.70 1.9 RitterPharm
PVBC
RTTR
19.75
3.70
2.9
3.2
Endocyte
ExtractionOil
ECYT
XOG
2.06
17.73
4.7
-2.4
TheStreet
TrilliumTherap
TST
TRIL
0.77
4.50
-2.3
-2.1
DelekLogistics DKL 35.00 1.9 MedleyNts24 MDLQ 25.30 0.1 TransportadGas TGS 10.50 5.1 FranklinIntlOpps FLIO 24.64 0.9 AdvEnergyInds AEIS 63.75 -1.3 HowardBancorp HBMD 18.68 1.2 SLM SLM 11.96 1.3 FinishLine FINL 16.55 0.6 US Energy USEG 1.01 -7.0
Domino's DPZ 175.09 0.4 MercuryGeneral MCY 63.59 0.6 TritonIntl TRTN 24.40 1.6 GuggenheimBS2019HY BSJJ 24.44 ... AriadPharm ARIA 23.85 0.7 HunterMaritimeWt HUNTW 0.85 13.3 Sanmina SANM 40.85 4.6 FirstNBCBank FNBC 3.60 -32.8 VeraBradley VRA 11.01 ...
DoubleLineIncm DSL 19.88 0.7 Natuzzi NTZ 2.44 7.9 Tronox TROX 12.65 3.6 iPathBloomCopperTR JJC 31.60 2.4 AscendisPharma ASND 21.94 1.5 IdexxLab IDXX 122.47 1.5 ServisFirstBcshs SFBS 40.35 5.2 FlexPharma FLKS 4.10 -2.0 VisionChina VISN 3.81 -1.0
EtnVncSrFltRte EFR 15.10 ... NuSTAREnergy NS 55.64 1.0 UnitedRentals URI 129.60 -1.8 PIMCOEnhShMaturity MINT 101.52 ... AudioCodes AUDC 6.80 3.3 ILG ILG 19.00 2.2 SmartFinancial SMBK 23.20 2.7 GalenaBiopharma GALE 1.61 -2.9 VistaGenTherap VTGN 2.80 -4.2

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Class “A” 62,000 Sq Ft
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Ideal for 1031 Investors
Hampton Inn J/V Opportunity &'()**+)(+++ EVERY WEDNESDAY
843-290-9948
Central Florida
Experienced Developer looking for 
scott.rogers@colliers.com Equity Partner to Co-Fund LIST YOUR
Colliers International Seeking $4M Equity, Preferred Return PROPERTY TODAY
INVESTMENT PROPERTIES INVESTMENT PROPERTIES Approved 101 Room Hotel on
Major I-95 Interchange INVESTMENT PROPERTIES
954-971-6775 § speno.tom@prd-realty.com
(800) 366-3975
sales.realestate@wsj.com
For Sale Commercial Building For Sale: SoCal Retail Strip Center 5 Acres of R-3 Infill Land in Santa Barbara Don’t think too long. Act!
Hillsdale MI 1990s-Built Value-Added Opportunity Excellent Long-Term Investment with Income For sale by owner. 1st TD for Sale Place an ad at:
wsj.com/classifieds
Excellent investment. Building with 4 lots on 23,500 SF on 1.7 Acres of Land Currently Mobile Home Park -- Major Upside Exclusive rare developable land.
M-99. 5,300 sq ft, large shop area, office space $62/SF - Below Replacement Cost Priced Below Land Value -- Trophy Property 100x100. R6b zoned. $345,000 Principal
and 1 bedroom 2 bath apartment. 60% Occupied w/ Below Market Rents $6,495,000 Firm - Only $29 per square foot In booming downtown Brooklyn.
Lots of storage. Great location. $225,000. Offered at $1,449,000 Will Consider Joint Venture or Creative Opps Clinton Hill section 10.9% interest only
Hillsdale Rental Management LLC Call or Text 760-618-6655 SantaBarbaraMHP@gmail.com Serious investors only.
517-797-5528 SoCalRetailCenter@gmail.com Call owner direct. 516 233 4830 note4sale@sovcapital.com © Dow Jones & Company, Inc.
Call or Text 805-335-1545 All Rights Reserved.
THE WALL STREET JOURNAL. Wednesday, February 1, 2017 | B11

BIGGEST 1,000 STOCKS

WSJ.com/stocks
Net Net Net Net Net Net
How to Read the Stock Tables Footnotes: Stock Sym Close Chg Stock Sym Close Chg Stock Sym Close Chg Stock Sym Close Chg Stock Sym Close Chg Stock Sym Close Chg
The following explanations apply to NYSE, NYSE s-New 52-week high. Flowserve FLS 49.16 -1.32 Leggett&Platt LEG 47.72 0.53 PetroChina PTR 79.49 0.32 TJX TJX 74.92 0.88 ZayoGroup ZAYO 31.96 0.02 LamarAdvertising LAMR 75.52 -0.18
Arca, NYSE MKT and Nasdaq Stock Market listed t-New 52-week low. Fluor FLR 55.50 -0.66 Leidos LDOS 48.32 -0.30 PetroleoBrasil PBR 10.26 -0.13 TaiwanSemi TSM 30.91 -0.28 ZimmerBiomet ZBH 118.33 2.94 LibertyBroadbandA LBRDA 83.68 0.05
securities. Prices are composite quotations that dd-Indicates loss in the most recent four FomentoEconMex FMX 75.23 -0.46 Lennar A LEN 44.65 -0.81 PetroleoBrasilA PBR/A 9.51 0.02 TargaResources TRGP 57.62 0.45 s Zoetis ZTS 54.94 0.67 LibertyBroadbandC LBRDK 85.34 0.27
include primary market trades as well as trades quarters. FootLocker FL 68.54 0.62 Lennar B LEN/B 35.96 -0.62 Pfizer PFE 31.73 0.42 Target TGT 64.48 0.36 s LibertyGlobal A LBTYA 36.48 -0.14
reported by Nasdaq OMX BXSM (formerly FD-First day of trading. FordMotor F 12.36 -0.01 LennoxIntl LII 156.81 0.23 PhilipMorris PM 96.13 0.17 TataMotors TTM 38.96 0.16 NASDAQ LibertyGlobal B LBTYB 39.41 -0.39
Boston), Chicago Stock Exchange, CBOE, National h-Does not meet continued listing ForestCIty A FCE/A 22.64 0.36 LeucadiaNatl LUK 23.85 0.11 Phillips66 PSX 81.62 -0.71 TechnipFMC FTI 33.62 0.32 LibertyGlobal C LBTYK 35.13 -0.17
Stock Exchange, ISE and BATS. standards s Level3Comm LVLT 59.46 0.13 53.19 0.45 AGNC Invt AGNC 18.67 -0.25
LibertyLiLAC A LILA 23.02 -0.06
ForestCity B FCE/B 29.10 0.44 PinnacleFoods PF TeckRscsB TECK 24.54 0.25
The list comprises the 1,000 largest companies lf-Late filing LibertyProperty LPT 38.39 0.74 PinnacleWest PNW 77.63 1.19 Ansys ANSS 93.26 -0.22
LibertyLiLAC C LILAK 22.32 -0.08
Fortis FTS 32.14 0.89 TelecomItalia TI 8.61 0.21
based on market capitalization. q-Temporary exemption from Nasdaq LLY 77.03 2.33 PioneerNatRscs PXD 180.23 1.43 ARRIS Intl ARRS 28.58 -0.14
LibertyQVC B QVCB 19.99 0.61
Fortive FTV 55.31 -0.13 EliLilly TelecomItalia A TI/A 7.13 0.19
Underlined quotations are those stocks with requirements. LincolnNational LNC 67.51 -0.98 PlainsAllAmPipe PAA 31.39 0.32 ASML ASML 121.40 -0.31 LibertyQVC A QVCA 19.18 0.01
FortBrandsHome FBHS 55.13 -0.51 Teleflex TFX 167.73 2.18
large changes in volume compared with the t-NYSE bankruptcy Franco-Nevada FNV 65.04 2.63 LionsGate A LGF/A 28.77 0.22 PolarisIndustries PII 84.07 0.52 TelefonicaBras VIV 14.78 ...
ActivisionBliz ATVI 40.21 0.60 LibertyVenturesA LVNTA 43.65 0.26
issue’s average trading volume. v-Trading halted on primary market. LiveNationEnt LYV 28.62 0.40 PostHoldings POST 83.68 0.24 AdobeSystems ADBE 113.38 -0.44 LincolnElectric LECO 83.37 -0.55
FranklinRscs BEN 39.74 -0.43 Telefonica TEF 9.64 0.05
Boldfaced quotations highlight those issues vj-In bankruptcy or receivership or being LloydsBanking LYG 3.32 0.03 Potash POT 18.60 0.07 AkamaiTech AKAM 68.59 0.78 LLTC 63.13 -0.30
Freeport-McMoRan FCX 16.65 0.40 TelekmIndonesia TLK 29.42 0.32 LinearTech
whose price changed by 5% or more if their reorganized under the Bankruptcy Code, LockheedMartin LMT 251.33 -1.50 Praxair PX 118.44 -0.86 AlexionPharm ALXN 130.68 2.63 LULU 67.51 0.62
FreseniusMed FMS 40.80 0.40 Tenaris TS 35.04 0.18 lululemon
previous closing price was $2 or higher. or securities assumed by such companies. 46.58 0.16 PrincipalFin PFG 57.09 -0.65 AlignTech ALGN 91.69 1.71 s
GGP GGP 24.84 0.88 Loews L Teradyne TER 28.38 -0.42 MarketAxess MKTX 187.25 5.91
Lowe's LOW 73.08 -0.49 Procter&Gamble PG 87.60 0.85 Alkermes ALKS 54.11 1.85
MAR 84.60 -0.66
Gallagher AJG 53.83 -0.04 Tesoro TSO 80.85 -2.56 Marriott
Wall Street Journal stock tables reflect composite regular trading as of 4 p.m. and Luxottica LUX 53.56 -0.33 Progressive PGR 37.44 -0.05 Alphabet A GOOGL 820.19 -3.64
MarvellTech MRVL 14.87 -0.04
Gap GPS 23.03 0.15 TesoroLogistics TLLP 57.88 -0.08
changes in the closing prices from 4 p.m. the previous day. LyondellBasell LYB 93.27 -1.03 Prologis PLD 48.85 0.11 Alphabet C GOOG 796.79 -5.53
MAT 26.21 -0.11
Gartner IT 99.36 -0.46 TevaPharm TEVA 33.43 -1.09 Mattel
M&T Bank MTB 162.57 -0.68 PrudentialFin PRU 105.11 -0.46 Amazon.com AMZN 823.48 -6.90
MaximIntProducts MXIM 44.48 -0.53
Gazit-Globe GZT 9.27 -0.07 Textron TXT 47.37 -0.08
MDU Rscs MDU 29.35 0.06 Prudential PUK 38.79 -0.12 Amdocs DOX 58.71 0.39
MelcoCrownEnt MPEL 16.84 -0.22
Tuesday, January 31, 2017 Net Net GeneralDynamics GD 181.08 -1.39 ThermoFisherSci TMO 152.39 9.10
MGM Resorts MGM 28.80 -0.31 PublicServiceEnt PEG 44.25 1.04 Amerco UHAL 376.67 -4.13
MercadoLibre MELI 185.39 0.27
Stock Sym Close Chg Stock Sym Close Chg GeneralElec GE 29.70 -0.26 ThomsonReuters TRI 44.84 0.12
Net GeneralMills GIS 62.48 -0.12 MPLX MPLX 37.85 0.45 PublicStorage PSA 215.00 0.01 ThorIndustries THO 103.50 -0.74
AmericanAirlines AAL 44.25 -0.65
MicrochipTech MCHP 67.35 -1.71
Stock Sym Close Chg MSCI MSCI 82.75 -0.86 PulteGroup PHM 21.51 0.12 Amgen AMGN 156.68 2.25
MicronTech MU 24.11 -0.07
BcoSantChile BSAC 21.59 -0.05 Colgate-Palmolive CL 64.58 0.05 GeneralMotors GM 36.61 0.28 3M MMM 174.82 -0.60
MSC Industrial MSM 102.15 -1.31 QuantaServices PWR 35.89 -0.69 AnalogDevices ADI 74.94 -1.34
Microsemi MSCC 53.15 -1.24
BancoSantander SAN 5.56 ... ColonyNorthStar CLNS 13.92 0.07 GenuineParts GPC 96.81 -0.27 Tiffany TIF 78.72 0.67
NYSE BanColombia CIB 37.86 0.08 Comerica CMA 67.53 -0.57 Gerdau GGB 3.83 -0.02 Macerich MAC 68.69 1.01 QuestDiag DGX 91.92 1.38 TimeWarner TWX 96.85 0.23
Apple AAPL 121.35 -0.28
Microsoft MSFT 64.65 -0.48
MacquarieInfr MIC 74.99 0.22 QuintilesIMS Q 78.49 3.14 AppliedMaterials AMAT 34.25 -0.09
Middleby MIDD 134.18 -0.40
ABB 23.82 0.02 BankofAmerica BAC 22.64 -0.31 SABESP SBS 9.96 -0.01 Gildan GIL 26.17 0.41 Torchmark TMK 73.54 -0.51
ABB Macy's M 29.54 0.02 RELX RENX 16.84 0.14 ArchCapital ACGL 88.35 -0.07
Mondelez MDLZ 44.28 -0.15
ACM 36.93 -0.07 BankofMontreal BMO 75.63 0.11 CSC CSC 62.20 0.90 GlaxoSmithKline GSK 39.31 0.31 Toro TTC 58.93 0.13
AECOM MagellanMid MMP 80.03 0.20 RELX RELX 18.21 0.15 Atlassian TEAM 27.63 0.02
MonsterBeverage MNST 42.60 0.17
AES 11.44 0.23 BankNY Mellon BK 44.73 0.06 ConagraBrands CAG 39.09 0.07 GlobalPayments GPN 77.28 -0.53 TorontoDomBk TD 51.77 0.01
AES MagnaIntl MGA 43.28 0.21 RPM RPM 52.26 -0.34 Autodesk ADSK 81.34 0.18
Mylan MYL 38.05 1.71
AFL 69.99 -0.36 BkNovaScotia BNS 59.78 0.14 ConchoRscs CXO 139.44 0.66 Goldcorp GG 16.17 0.38 Total TOT 50.56 0.74
Aflac s Manpower MAN 95.46 0.80 RSP Permian RSPP 42.56 0.57 ADP ADP 100.99 -0.98
NXP Semi NXPI 97.85 -0.17
42.16 0.34 Barclays BCS 11.07 -0.12 ConocoPhillips COP 48.76 1.28 GoldmanSachs GS 229.32 -4.58 TotalSystem TSS 50.68 -0.59
AT&T T ManulifeFin MFC 19.16 0.18 RalphLauren RL 88.43 -0.01 B/EAerospace BEAV 61.47 -0.03
Nasdaq NDAQ 70.54 2.36
AXIS Capital AXS 64.01 -0.21 Bard CR BCR 237.33 0.51 ConEd ED 74.35 1.09 Grainger GWW 252.57 -2.09 ToyotaMotor TM 115.75 -0.32
BOK Fin BOKF 82.24 0.40
GreatPlainsEner GXP 27.55 0.62 MarathonOil MRO 16.75 0.22 RangeResources RRC 32.34 -1.00 TransCanada TRP 47.22 0.21 NetApp NTAP 38.32 0.25
AbbottLabs ABT 41.77 0.76 BarrickGold ABX 18.44 0.43 ConstBrands A STZ 149.76 1.42
MarathonPetrol MPC 48.05 -0.31 RaymondJames RJF 74.93 -0.63 Baidu BIDU 175.07 0.35
BaxterIntl BAX 47.91 1.01 ConstBrands B STZ/B 151.28 3.33 GpoAvalAcciones AVAL 8.32 -0.07 TransDigm TDG 216.40 -0.21 Netease NTES 253.90 3.41
AbbVie ABBV 61.11 0.68 MarineHarvest MHG 17.67 0.01 Raytheon RTN 144.16 -1.39 BankofOzarks OZRK 54.87 -0.27
GpFinSantandMex BSMX 7.15 0.05 Transocean RIG 13.97 0.12 Netflix NFLX 140.71 -0.51
Accenture ACN 113.87 -0.76 BectonDickinson BDX 177.29 2.47 ContinentalRscs CLR 48.56 0.57
Markel MKL 925.00 9.07 RealtyIncome O 59.63 0.34 BedBath BBBY 40.35 0.35
WRB 67.21 -0.09 Cooper COO 184.61 2.85 GrupoTelevisa TV 22.40 -0.11 TransUnion TRU 31.53 -0.40 NewsCorp A NWSA 12.29 -0.04
AcuityBrands AYI 207.23 2.38 Berkley Marsh&McLennan MMC 68.02 -0.32 RedHat RHT 75.88 0.37 Biogen BIIB 277.24 1.18
GLW 26.49 -0.16 GuangshenRail GSH 32.21 0.07 TRV 117.78 0.27 NewsCorp B NWS 12.65 -0.05
Adient ADNT 63.49 -0.53 BerkHathwy A BRK/A 245980-519.66 Corning MartinMarietta MLM 229.60 -5.71 RegencyCtrs REG 69.73 0.78
Travelers BioMarinPharm BMRN 87.63 2.09
COTY 19.20 0.35 HCAHoldings HCA 80.28 0.99 7.45 -0.06 Nordson NDSN 113.53 -1.14
AdvanceAuto AAP 164.24 -0.39 BerkHathwy B BRK/B 164.14 -0.66 Coty Masco MAS 32.95 -0.36 RegionsFin RF 14.41 -0.04
TurkcellIletism TKC BlackBerry BBRY 7.06 0.01
BerryPlastics BERY 51.03 0.32 Credicorp BAP 163.68 -0.39 HCP HCP 30.32 0.25 TurquoiseHill TRQ 3.61 0.07 NorthernTrust NTRS 82.96 -0.19
AdvSemiEngg ASX 5.72 -0.03 Mastercard MA 106.33 -2.97 s ReinsuranceGrp RGA 125.47 0.54 Broadcom AVGO 199.50 -3.72
BBY 44.52 0.30 CreditSuisse CS 15.20 -0.20 HDFC Bank HDB 68.93 0.58 Twitter TWTR 17.62 0.68 NorwegianCruise NCLH 47.00 -1.03
Aegon AEG 5.48 0.02 BestBuy McCormick MKC 95.55 0.07 RelianceSteel RS 79.65 -0.85 CA CA 31.27 0.14
Bio-RadLab A BIO 190.08 3.47 CrescentPoint CPG 11.67 0.08 HP HPQ 15.05 0.21 TylerTech TYL 146.02 -1.46 NVIDIA NVDA 109.18 -0.84
AerCap AER 44.27 0.14 McCormickVtg MKC/V 95.50 0.23 RenaissanceRe RNR 136.32 -0.34 s CBOE Holdings CBOE 79.62 1.75
HSBCHoldings HSBC 42.60 0.10 TysonFoods TSN 62.79 0.22 OReillyAuto ORLY 262.27 0.38
Aetna AET 118.61 1.90 Bio-RadLab B BIO/B 187.42 -0.03 CrestwoodEquity CEQP 27.45 0.95
McDonalds MCD 122.57 -0.45 RepublicServices RSG 57.38 -0.07 s CDK Global CDK 62.55 0.40
BLK 373.98 -1.20 CrownCastle CCI 87.83 1.07 Halliburton HAL 56.57 0.09 UBS Group UBS 16.11 -0.17 OldDomFreight ODFL 88.28 -1.21
AffiliatedMgrs AMG 152.36 1.04 BlackRock McKesson MCK 139.15 2.04 ResMed RMD 67.54 -0.16 CDW CDW 51.51 0.47
30.63 -0.39 CrownHoldings CCK 54.17 0.51 Hanesbrands HBI 23.71 0.38 UDR UDR 34.95 0.30 ON Semi ON 13.32 -0.43
AgilentTechs A 48.97 1.30 BlackstoneGroup BX MeadJohnson MJN 70.46 0.33 RestaurantBrands QSR 49.08 -0.26 CH Robinson CHRW 76.06 -0.45
BoardwalkPipe BWP 18.46 0.19 Cullen/Frost CFR 89.40 -0.61 HarleyDavidson HOG 57.04 -0.88 UGI UGI 46.37 0.82 OpenText OTEX 34.27 0.20
AgnicoEagle AEM 47.70 1.53 Mednax MD 68.35 0.41 ReynoldsAmer RAI 60.13 0.26 CME Group CME 121.08 0.64
BA 163.42 -2.15 Cummins CMI 147.01 ... HarmanIntlInds HAR 111.16 0.06 US Foods USFD 27.20 0.04 PTC PTC 52.57 0.42
Agrium AGU 102.91 0.01 Boeing Medtronic MDT 76.02 1.35 RioTinto RIO 44.79 0.40 CSX CSX 46.39 -1.10
BorgWarner BWA 40.83 0.27 DDR DDR 15.18 0.29 Harris HRS 102.71 0.33 UltraparPart UGP 20.94 -0.09 Paccar PCAR 67.31 -0.31
AirProducts APD 139.76 -1.23 Merck MRK 61.99 0.56 t RiteAid RAD 5.62 -0.10 CadenceDesign CDNS 26.03 -0.09
HartfordFinl HIG 48.71 -0.25 t UnderArmour A UAA 21.49 -7.45 PacWestBancorp PACW 55.40 0.22
AlaskaAir ALK 93.82 -0.34 BostonProperties BXP 130.90 0.63 DTE Energy DTE 98.64 1.49
MetLife MET 54.41 -0.49 RobertHalf RHI 47.06 0.83 Celgene CELG 116.15 2.97
s 83.92 3.56 71.16 0.71 t UnderArmour C UA 19.22 -5.87 Paychex PAYX 60.29 -0.52
Albemarle ALB 92.64 -1.93 BostonScientific BSX 24.06 0.21 Danaher DHR Helmerich&Payne HP
MettlerToledo MTD 426.63 4.57 Rockwell ROK 147.99 -1.32 Cerner CERN 53.71 0.77
BAK 20.69 -0.38 Darden DRI 73.28 -0.54 Herbalife HLF 56.20 0.51 Unilever 40.65 0.20 PayPal PYPL 39.78 -0.08
Alcoa AA 36.45 -0.10 Braskem MichaelKors KORS 42.81 1.02 RockwellCollins COL 90.76 -0.09
UN CharterComms CHTR 323.95 -0.85
DVA 63.75 0.40 HSY 105.47 0.40 41.11 0.21 People'sUtdFin PBCT 18.75 0.09
AlexandriaRealEst ARE 110.82 -1.34 Bristol-Myers BMY 49.16 0.47 DaVita Hershey
MidAmApt MAA 94.95 0.15 RogersComm B RCI 43.40 0.23
Unilever UL CheckPointSftw CHKP 98.77 0.32
DE 107.05 -0.01 HES 54.18 0.24 UnionPacific UNP 106.58 -1.42 Priceline PCLN 1575.13 -27.18
Alibaba BABA 101.31 0.29 BrixmorProp BRX 24.13 0.09 Deere Hess
MitsubishiUFJ MTU 6.39 0.02 Rollins ROL 35.26 0.08 CincinnatiFin CINF 70.58 0.54
66.53 0.12 DelphiAutomotive DLPH 70.06 0.36 HewlettPackard HPE 22.68 0.53 UnitedContinental UAL 70.47 -1.25 Qiagen QGEN 28.98 0.49
Alleghany Y 611.57 1.99 BroadridgeFinl BR MizuhoFin MFG 3.68 0.02 s RoperTech ROP 191.85 1.45 Cintas CTAS 116.11 -0.09
BrookfieldMgt BAM 34.58 0.23 DeltaAir DAL 47.24 -0.43 HiltonWorldwide HLT 57.58 -0.46 UPS B UPS 109.13 -7.90 Qorvo QRVO 64.21 -0.08
Allegion ALLE 65.67 -0.17 MobileTeleSys MBT 10.47 -0.09 s RoyalBkCanada RY 71.87 0.17 CiscoSystems CSCO 30.72 -0.11
34.95 0.51 DeutscheBank DB 19.91 -0.20 HollyFrontier HFC 28.97 -0.42 s UnitedRentals URI 126.51 -2.26 Qualcomm QCOM 53.43 -0.18
Allergan AGN 218.89 7.02 BrookfieldInfr BIP Mobileye MBLY 42.96 -0.53 RoyalBkScotland RBS 5.62 -0.06 CitrixSystems CTXS 91.19 0.06
Brown&Brown BRO 42.13 -0.26 DevonEnergy DVN 45.54 0.47 HomeDepot HD 137.58 -0.89 US Bancorp USB 52.65 -0.20 RandgoldRscs GOLD 84.94 2.78
AllianceData ADS 228.38 0.20 MohawkIndustries MHK 215.84 0.38 RoyalCaribbean RCL 93.63 -0.77 Cognex CGNX 67.56 0.51
DEO 112.03 0.36 HondaMotor HMC 29.72 -0.23 32.71 -0.29 RegenPharm REGN 359.29 14.79
AllianceBernstein AB 23.35 0.05 Brown-Forman A BF/A 46.78 0.02 Diageo MolsonCoors A TAP/A 96.21 1.21 RoyalDutchA RDS/A 54.39 0.68
US Steel X CognizantTech CTSH 52.59 -1.07
DKS 51.60 -0.57 HON 118.32 -0.79 UnitedTech UTX 109.67 0.50 RossStores ROST 66.11 0.72
AlliantEnergy LNT 37.65 0.79 Brown-Forman B BF/B 45.60 0.12 Dick's Honeywell
MolsonCoors B TAP 96.52 1.05 RoyalDutchB RDS/B 57.47 0.59 Comcast A CMCSA 75.42 0.08 Ryanair RYAAY 83.66 0.15
AllisonTransm ALSN 34.98 0.12 s Brunswick BC 59.86 0.70 DigitalRealty DLR 107.63 1.21 HormelFoods HRL 36.30 0.03
Monsanto MON 108.31 -0.26 SAP SAP 91.51 0.18
UnitedHealth UNH 162.10 0.01 CommerceBcshrs CBSH 56.53 0.03
BuckeyePtrs BPL 69.71 0.63 DiscoverFinSvcs DFS 69.28 -0.35 DR Horton DHI 29.91 -0.80 UniversalHealthB UHS 112.63 -0.12 SBA Comm SBAC 105.26 0.96
Allstate ALL 75.21 -0.40 Moody's MCO 103.67 -0.09 S&P Global SPGI 120.18 -0.44 CommScope COMM 37.82 0.82
69.21 1.40 Disney DIS 110.65 -0.29 HostHotels HST 18.07 0.13 UnumGroup UNM 45.43 -0.20 SEI Investments SEIC 48.51 -0.31
s AllyFinancial ALLY 21.12 1.43 Bunge BG
MorganStanley MS 42.49 -0.63 SINOPECShanghai SHI 62.34 0.03 Copart CPRT 56.74 -0.19
73.82 1.82 HuanengPower HNP 26.17 0.03 8.53 0.16 SS&C Tech SSNC 32.13 0.16
s Altria MO 71.18 -0.12 BurlingtonStores BURL 83.70 2.06 DollarGeneral DG
Mosaic MOS 31.37 0.40 SK Telecom SKM 21.50 0.16
VEREIT VER CoStarGroup CSGP 202.10 0.06 SVB Fin SIVB 172.23 -2.52
AlumofChina ACH 12.89 -0.02 CBRE Group CBG 30.36 0.27 DominionRscs D 76.28 1.02 s Hubbell HUBB 122.08 4.27 t VF VFC 51.48 0.13 Costco COST 163.95 0.70
MotorolaSolutions MSI 80.71 -0.99 SLGreenRealty SLG 108.97 -0.07 Sabre SABR 24.50 -0.04
Ambev ABEV 5.39 -0.01 CBS A s
CBS/A 65.77 0.17 Domino's DPZ 174.54 0.61 HudsonPacProp HPP 35.41 0.02 Visa V 82.71 -0.99 Ctrip.com CTRP 43.21 -0.19
NCR NCR 43.02 0.57 Salesforce.com CRM 79.10 0.39 ScrippsNetworks SNI 76.16 -0.14
Ameren AEE 52.65 0.96 CBS B CBS 64.49 0.09 Donaldson DCI 42.25 -0.26 Humana HUM 198.50 -0.76 s VailResorts MTN 171.54 1.03 DISH Network DISH 59.17 -0.17
NTTDoCoMo DCM 23.92 0.17 Sanofi SNY 40.78 0.78 Seagate STX 45.15 0.25
AmericaMovil AMX 12.61 -0.16 CF Industries CF 35.29 -0.10 DouglasEmmett DEI 37.84 0.28 HuntingtonIngalls HII 193.96 1.35 Vale VALE 10.18 -0.13 DentsplySirona XRAY 56.70 0.36
NVR NVR 1858.00 -18.83 Sasol SSL 29.86 0.20 SeattleGenetics SGEN 60.24 3.01
AmericaMovil A AMOV 12.57 -0.09 CGI Group GIB 48.09 -0.03 Dover DOV 77.75 -0.68 HyattHotels H 54.71 0.31 ValeantPharm VRX 13.78 0.45 DexCom DXCM 79.15 0.60
NationalGrid NGG 58.47 0.86 Scana SCG 68.70 0.57 Shire SHPG 167.81 3.49
AmCampus ACC 48.62 0.31 CIT Group CIT 41.19 -0.65 DowChemical DOW 59.63 -0.52 ICICI Bank IBN 7.75 -0.14 ValeroEnergy VLO 65.76 -2.47 DiamondbackEner FANG 105.17 2.67
NatlOilwell NOV 37.81 0.26 Schlumberger SLB 83.71 0.10 SignatureBank SBNY 157.52 0.23
AEP AEP 64.06 0.85 CMS Energy CMS 42.60 0.56 DrPepperSnap DPS 91.20 0.51 ING Groep ING 14.38 0.04
NatlRetailProp NNN 43.60 1.01 SchwabC SCHW 41.24 -0.59 Valspar VAL 110.67 0.30 DiscoveryComm A DISCA 28.35 0.37
CNA 41.65 0.05 DrReddy'sLab RDY 45.20 0.80 Invesco IVZ 28.92 -0.30 VNTV 62.24 -0.59 SiriusXM SIRI 4.72 -0.04
AmericanExpress AXP 76.38 -0.90 CNA Fin NewOrientalEduc EDU 47.55 0.10 ScottsMiracleGro SMG 91.97 -1.01 Vantiv DiscoveryComm C DISCK 27.71 0.31
CEO 125.83 0.74 DuPont 75.50 -0.50 IDEX IEX 90.16 -1.86 VAR 77.65 -0.03 Skyworks SWKS 91.74 -0.97
AmericanFin AFG 86.17 -0.26 CNOOC DD NY CmntyBcp NYCB 15.19 0.04 SealedAir SEE 48.50 -0.08 VarianMed DollarTree DLTR 77.19 1.94
IllinoisToolWks ITW 127.20 -1.59 Splunk SPLK 57.86 0.46
AmerHomes4Rent AMH 22.28 0.36 CPFLEnergia CPL 16.06 -0.14 DukeEnergy DUK 78.54 1.42 NewellBrands NWL 47.33 1.05 SemicondctrMfg SMI 6.88 -0.06 Vedanta VEDL 14.80 -0.19 Dunkin' DNKN 51.87 -0.11
CRH CRH 34.52 -0.63 DukeRealty DRE 24.33 0.29 t Infosys INFY 13.77 -0.04 VeevaSystems VEEV 42.33 0.27 Staples SPLS 9.20 -0.01
AIG AIG 64.26 -0.63 NewfieldExpln NFX 40.08 -0.04 SempraEnergy SRE 102.39 1.57 E*TRADE ETFC 37.45 -0.50
30.91 0.03 79.35 -0.20 Starbucks SBUX 55.22 -0.68
AmerTowerREIT AMT 103.50 0.49 CVS Health CVS 78.81 0.13 ENI E Ingersoll-Rand IR NewmontMining NEM 36.28 1.31 SensataTech ST 41.95 -0.35 Ventas VTR 61.67 0.24 EastWestBancorp EWBC 51.44 -0.41
CabotOil COG 21.48 0.22 EOG Rscs EOG 101.58 0.38 Ingredion INGR 128.19 1.04 Verizon VZ 49.01 -0.36 SteelDynamics STLD 33.81 -1.35
AmerWaterWorks AWK 73.44 1.53 NextEraEnergy NEE 123.72 1.27 ServiceCorp SCI 29.13 -0.09 eBay EBAY 31.83 -0.34
58.36 0.42 Stericycle SRCL 77.14 0.84
Amerigas APU 49.21 0.17 CamdenProperty CPT 83.57 1.28 EQT EQT 60.63 -1.28 ICE ICE NielsenHoldings NLSN 40.91 -0.16 ServiceNow NOW 90.62 0.50 VermilionEnergy VET 41.19 0.70 ElectronicArts EA 83.43 -0.41
CCJ 12.75 0.14 EQT Midstream EQM 78.26 1.20 InterContinentl IHG 46.43 -0.04 VIPS 11.32 0.26 Symantec SYMC 27.55 0.28
Ameriprise AMP 112.27 -0.79 Cameco Nike NKE 52.90 -0.18 s ShawComm B SJR 21.59 0.03 Vipshop Equinix EQIX 384.98 -1.39
IBM 174.52 -1.28 Synopsys SNPS 62.89 0.27
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69.52 -0.25 Ecolab ECL 120.13 -1.36 IntlGameTech IGT 26.41 0.30 VoyaFinancial VOYA 40.22 -0.13 TESARO TSRO 162.84 9.40
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CAJ 29.57 -0.18 EdwardsLife EW 96.24 -0.23 IronMountain IRM 35.80 0.01 EWEC Energy WEC 59.05 0.84 TeslaMotors TSLA 251.93 1.30
AnnalyCap NLY 10.22 -0.03 Canon Nordstrom JWN 44.22 0.52 SimonProperty SPG 183.77 6.03 ExpressScripts ESRX 68.88 0.77
COF 87.39 -1.42 EmersonElectric EMR 58.66 -0.48 IsraelChemicals ICL 4.60 -0.01 WPC 61.94 0.89 TexasInstruments TXN 75.54 -2.36
AnteroMidstream AM 33.52 -0.08 CapitalOne NorfolkSouthern NSC 117.46 -2.17 SixFlags SIX 59.58 -0.07 W.P.Carey F5Networks FFIV 134.03 -0.66
ItauUnibanco ITUB 11.81 -0.11 TractorSupply TSCO 73.67 -0.81
AnteroResources AR 24.41 -0.22 CardinalHealth CAH 74.96 1.77 EnbridgeEnPtrs EEP 19.37 0.36 NorthropGrumman NOC 229.08 -0.40 SmithAO AOS 48.75 0.30 WPX Energy WPX 13.93 -0.16 Facebook FB 130.32 -0.66
CSL 109.11 -1.62 Enbridge ENB 42.60 0.12 JPMorganChase JPM 84.63 -1.40 WAB 86.64 -0.08 Trimble TRMB 29.62 0.28
s Anthem ANTM 154.14 -0.04 Carlisle Novartis NVS 73.92 1.62 Smith&Nephew SNN 30.38 0.12 Wabtec Fastenal FAST 49.68 -0.52
KMX 66.71 -0.18 Encana ECA 12.76 0.09 JacobsEngineering JEC 58.55 -0.83 WMT 66.74 0.32 TripAdvisor TRIP 52.90 0.65
Aon AON 112.70 0.63 CarMax NovoNordisk NVO 36.17 0.48 Smucker SJM 135.85 1.73 Wal-Mart FifthThirdBncp FITB 26.10 -0.23
Carnival CCL 55.38 -0.26 Endurance ENH 92.69 -0.04 JamesHardie JHX 15.77 0.06 WasteConnections WCN 80.30 0.19 21stCenturyFoxA FOXA 31.38 0.01
Apache APA 59.82 -0.13 Nucor NUE 58.09 -2.01 s SnapOn SNA 181.53 0.05 Fiserv FISV 107.43 -0.72
CUK 54.37 -0.24 EnelAmericas ENIA 9.03 0.19 J&J JNJ 113.25 0.12 WM 69.50 -0.10 21stCenturyFoxB FOX 31.01 0.03
ApartmtInv AIV 44.07 0.19 Carnival s NuSTAREnergy NS 55.31 0.55 SOQUIMICH SQM 32.32 0.01 WasteMgt Flex FLEX 15.67 -0.31
CAT 95.66 -1.13 EnelGenChile EOCC 19.38 -0.03 JohnsonControls JCI 43.98 0.21 WAT 141.65 0.70 UltaBeauty ULTA 272.28 2.10
AquaAmerica WTR 30.41 0.54 Caterpillar OGE Energy OGE 33.54 0.30 SonocoProducts SON 54.95 0.14 Waters Fortinet FTNT 33.26 0.45
84.40 0.28 EnergyTrfrEquity ETE 17.95 -0.07 JoyGlobal JOY 28.12 ... WSO 152.74 0.06
UltimateSoftware ULTI 193.66 -0.04
Aramark ARMK 33.84 0.31 Celanese A CE ONEOK OKE 55.11 1.34 Sony SNE 30.27 0.83 Watsco Gaming&Leisure GLPI 31.63 0.53 s
9.26 -0.04 EnergyTrfrPtrs ETP 38.15 0.06 JuniperNetworks JNPR 26.78 0.33 WellCareHealth WCG 145.54 0.53
UnitedTherap UTHR 163.63 3.96
ArcelorMittal MT 7.79 -0.17 Cemex CX ONEOK Partners OKS 43.14 0.58 Southern SO 49.43 0.77 Garmin GRMN 48.29 0.94
CNCO 8.61 -0.21 Enerplus 8.93 0.31 KAR Auction KAR 45.55 0.13 WellsFargo WFC 56.33 0.25
VCA WOOF 90.60 -0.10
ArcherDaniels ADM 44.26 0.13 Cencosud ERF OccidentalPetrol OXY 67.77 -0.11 SoCopper SCCO 38.36 ... Gentex GNTX 20.89 -0.03
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Arconic ARNC 22.79 0.29 CenovusEnergy CVE 13.63 0.01 EnLinkMidPtrs ENLK 17.93 0.33 KB Fin KB Och-Ziff OZM 3.25 0.06 SouthwestAirlines LUV 52.31 -0.04 Welltower HCN 66.30 -0.04 GileadSciences GILD 72.45 0.94
CNC 63.27 0.52 Entergy ETR 71.64 1.03 KKR KKR 17.36 -0.18 WestPharmSvcs WST 84.63 1.20
VeriskAnalytics VRSK 82.64 -0.10
AristaNetworks ANET 94.00 0.33 Centene s OldRepublic ORI 20.80 0.20 SpectraEnergy SE 41.65 0.09 Goodyear GT 32.39 1.05
VertxPharm VRTX 85.87 1.49
ArrowElec ARW 73.52 0.64 s CenterPointEner CNP 26.21 0.38 EnterpriseProd EPD 28.33 -0.12 KT KT 14.87 0.32 OmegaHealthcare OHI 32.07 0.36 SpectraEnerPtrs SEP 45.34 0.04 WestarEnergy WR 54.69 0.10 Grifols GRFS 17.00 0.13
6.57 0.01 EnvisionHlthcr EVHC 68.00 1.06 KSCitySouthern KSU 85.91 -0.45 Viacom A VIA 45.25 -0.25
AshlandGlobal ASH 119.03 0.73 CentraisElBras EBR Omnicom OMC 85.65 -1.44 SpectrumBrands SPB 133.39 1.88 WestAllianceBcp WAL 49.38 -0.81 HDSupply HDS 42.30 0.07
EFX 117.28 -0.06 72.71 0.04 Viacom B VIAB 42.14 -0.32
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KEY 17.97 -0.10 VimpelCom VIP 4.23 0.01
AstraZeneca AZN 27.23 0.14 ChesapeakeEner CHK 6.45 -0.01 EquityLife ELS 73.94 0.19 KeyCorp Orange ORAN 15.55 0.17 s Sprint S 9.23 0.12 WesternGasPtrs WES 61.38 0.28 HenrySchein HSIC 159.86 1.54
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Autoliv ALV 115.66 1.78 ChinaLifeIns LFC 13.75 ... EsteeLauder EL 81.21 0.34 OwensCorning OC 55.25 -0.08 StateStreet STT 76.20 ... WestpacBanking WBK 24.14 -0.07 HuntingtonBcshs HBAN 13.53 -0.09
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AutoZone AZO 724.98 0.57 ChinaPetrol SNP 80.04 0.33 EversourceEner ES 55.32 0.89 PLDT PHI 30.05 -0.30 Steris STE 70.83 0.80 Weyerhaeuser WY 31.33 0.17 s IdexxLab IDXX 122.33 1.83
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BakerHughes BHI 63.08 1.26 Coach COH 37.35 1.37 FirstData FDC 15.34 -0.11 LambWeston LW 37.36 0.58 Pentair PNR 58.63 -2.13 TE Connectivity TEL 74.35 0.09 YanzhouCoal YZC 7.69 0.03 KLA Tencor KLAC 85.11 -1.14 CheniereEnergy LNG 47.65 0.20
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B12 | Wednesday, February 1, 2017 THE WALL STREET JOURNAL.

MARKETS DIGEST
EQUITIES

Dow Jones Industrial Average S&P 500 Index Nasdaq Composite Index
Last Year ago Last Year ago Last Year ago
19864.09 t 107.04, or 0.54% Trailing P/E ratio * 20.10 16.68 2278.87 t 2.03, or 0.09% Trailing P/E ratio * 24.74 20.93 5614.79 s 1.07, or 0.02% Trailing P/E ratio * 20.10 21.15
High, low, open and close for each P/E estimate * 17.50 15.07 High, low, open and close for each P/E estimate * 17.52 15.89 High, low, open and close for each P/E estimate * 19.15 17.10
trading day of the past three months. Dividend yield 2.41 2.76 trading day of the past three months. Dividend yield 2.12 2.32 trading day of the past three months. Dividend yield 1.16 1.27
All-time high 20100.91, 01/26/17 All-time high: 2298.37, 01/25/17 All-time high: 5660.78, 01/27/17

Current divisor 0.14602128057775

20000 2310 5660

19600 2270 5550

19200 2230 5440

65-day moving average
Session high 18800 2190 5330
DOWN UP
t

Session open Close

18400 2150 5220
Close Open
t

65-day moving average

Session low 65-day moving average 5110
18000 2110

Bars measure the point change from session's open

17600 2070 5000
Oct. Nov. Dec. Jan. Oct. Nov. Dec. Jan. Oct. Nov. Dec. Jan.
* P/E data based on as-reported earnings from Birinyi Associates Inc.

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

Latest 52-Week % chg Most-active and biggest movers among NYSE, NYSE Arca, NYSE MKT Volume, Advancers, Decliners
High Low Close Net chg % chg High Low % chg YTD 3-yr. ann. and Nasdaq issues from 4 p.m. to 6:30 p.m. ET as reported by electronic NYSE NYSE MKT
Dow Jones trading services, securities dealers and regional exchanges. Minimum Total volume*1,115,393,790 16,299,020
Industrial Average 19918.17 19784.77 19864.09 -107.04 -0.54 20100.91 15660.18 23.0 0.5 8.2 share price of $2 and minimum after-hours volume of 5,000 shares. Adv. volume* 623,818,838 8,007,217
Transportation Avg 9277.32 9137.05 9191.98 -137.36 -1.47 9468.77 6764.16 35.9 1.6 8.0 Most-active issues in late trading Decl. volume* 478,366,369 7,847,572
Utility Average 669.10 658.24 668.87 10.87 1.65 723.51 610.87 8.1 1.4 9.7 Volume After Hours Issues traded 3,117 333
Company Symbol (000) Last Net chg % chg High Low Advances 1,888 198
Total Stock Market 23711.72 23573.10 23706.14 7.11 0.03 23922.90 18663.11 21.7 1.8 8.1
VanEck Vectors Gold Miner GDX 17,596.5 23.88 -0.05 -0.21 23.93 23.83 Declines 1,096 115
Barron's 400 610.04 603.75 609.33 1.82 0.30 617.40 446.15 30.2 1.3 7.4
SPDR S&P 500 SPY 10,811.0 227.66 0.13 0.06 227.88 226.99 Unchanged 133 20
Nasdaq Stock Market Apple AAPL 8,258.3 125.12 3.77 3.11 125.61 119.06 New highs 72 4
Nasdaq Composite 5615.15 5576.09 5614.79 1.07 0.02 5660.78 4266.84 24.3 4.3 11.0 iShares MSCI Emg Markets EEM 6,618.0 37.34 … unch. 37.36 37.28 New lows 19 3
5116.80 5086.33 Closing tick 237 49
Nasdaq 100 5116.77 -12.56 -0.24 5168.06 3947.80 22.0 5.2 13.3 iShares Russell 2000 ETF IWM 5,203.5 135.33 0.10 0.07 135.48 135.13
Closing Arms† 1.49 2.22
VanEck Vectors Jr Gold GDXJ 4,886.2 37.71 -0.07 -0.19 37.79 37.62
Standard & Poor's Block trades* 6,786 201
Synergy Pharmaceuticals SGYP 4,310.9 6.15 -0.92 -13.01 7.07 6.00
500 Index 2279.09 2267.21 2278.87 -2.03 -0.09 2298.37 1829.08 19.7 1.8 8.5 Nasdaq NYSE Arca
Citigroup C 3,978.4 55.88 0.05 0.09 55.94 55.83
MidCap 400 1689.76 1672.66 1687.19 4.64 0.28 1710.29 1238.82 30.9 1.6 8.7 Total volume*2,008,293,641 331,682,552
SmallCap 600 835.40 823.87 834.20 7.06 0.85 857.50 588.26 35.6 -0.4 9.3 Percentage gainers… Adv. volume*1,050,592,868 207,612,063
Decl. volume* 916,160,072 122,843,742
Other Indexes XOMA XOMA 27.0 4.74 0.45 10.49 4.83 4.55
Issues traded 3,017 1,347
Russell 2000 1363.60 1345.65 1361.82 9.49 0.70 1388.07 953.72 35.0 0.3 6.4 Kandi Technologies Group KNDI 33.8 4.50 0.25 5.88 4.50 4.22
Advances 1,760 845
NYSE Composite 11225.94 11166.21 11222.96 17.72 0.16 11339.05 9029.88 19.2 1.5 4.0 Alon USA Energy ALJ 37.1 11.90 0.64 5.68 11.92 11.24 Declines 1,109 472
Value Line 513.34 508.17 513.02 1.98 0.39 520.17 383.82 27.6 1.4 2.7 Brandywine Realty Trust BDN 13.9 16.90 0.80 4.97 16.90 16.10 Unchanged 148 30
NYSE Arca Biotech 3254.47 3103.49 3250.57 116.54 3.72 3477.87 2642.53 17.1 5.7 8.6
Natuzzi ADR NTZ 16.9 2.42 0.11 4.76 2.42 2.17 New highs 83 12
New lows 51 5
NYSE Arca Pharma 479.89 469.86 479.87 6.25 1.32 554.66 463.78 -4.5 -0.3 0.8 ...And losers
Closing tick 366 69
KBW Bank 92.31 90.87 91.41 -0.58 -0.63 93.71 56.51 49.4 -0.4 10.7 Synergy Pharmaceuticals SGYP 4,310.9 6.15 -0.92 -13.01 7.07 6.00 Closing Arms† 1.38 1.07
PHLX§ Gold/Silver 91.76 90.64 91.76 2.73 3.07 112.86 46.25 98.4 16.4 0.4 Accuray ARAY 68.7 5.20 -0.55 -9.57 5.75 5.20 Block trades* 7,645 1,722
PHLX§ Oil Service 180.40 177.28 180.24 1.52 0.85 192.66 129.55 31.7 -1.9 -12.0 Boot Barn Holdings BOOT 14.9 9.99 -0.86 -7.93 10.85 9.60 * Primary market NYSE, NYSE MKT NYSE Arca only.
PHLX§ Semiconductor 952.65 938.76 944.28 -12.56 -1.31 962.26 559.18 58.5 4.2 21.3 Tractor Supply TSCO 28.0 68.73 -4.94 -6.71 74.31 68.73 †(TRIN) A comparison of the number of advancing and declining
CBOE Volatility 12.99 11.79 0.11 28.14 10.58 -45.5 -14.6 -13.3 issues with the volume of shares rising and falling. An
11.99 0.93 Match Group MTCH 77.0 16.46 -0.91 -5.24 17.65 15.86 Arms of less than 1 indicates buying demand; above 1

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

International Stock Indexes Percentage Gainers... Percentage Losers

Latest YTD
Region/Country Index Close Net chg % chg % chg Latest Session 52-Week Latest Session 52-Week
Company Symbol Close Net chg % chg High Low % chg Company Symbol Close Net chg % chg High Low % chg
World The Global Dow 2597.74 –4.35 –0.17 2.6 DryShips DRYS 5.05 2.59 105.28 2227.20 1.97 -99.6 Dimension Therapeutics DMTX 1.95 -2.30 -54.12 10.47 1.90 -69.9
The Global Dow Euro 2263.38 –28.39 –1.24 0.2 Diana Containerships DCIX 3.05 0.67 28.15 26.17 2.00 -30.7 First NBC Bank Holding FNBC 4.00 -1.95 -32.77 29.85 3.60 -85.3
DJ Global Index 334.91 0.03 0.01 2.7 Momenta Pharm MNTA 18.90 3.80 25.17 19.10 7.86 51.8 Roadrunner Trans Sys RRTS 7.92 -3.62 -31.37 13.67 6.67 0.5
World DJ Global ex U.S. 221.54 0.06 0.03 3.5 AEterna Zentaris AEZS 3.15 0.55 21.15 5.59 2.35 5.7 SeaDrill SDRL 1.87 -0.79 -29.70 7.49 1.57 -0.5
Americas DJ Americas 552.09 0.04 0.01 2.2 PAVmed PAVM 6.75 0.87 14.82 15.24 4.50 ... Psychemedics PMD 18.87 -6.75 -26.35 27.46 9.70 78.5
Brazil Sao Paulo Bovespa 64670.78 369.05 0.57 7.4 Fuling Global FORK 2.90 0.35 13.73 3.45 1.68 -5.8 Eco-Stim Energy Solutions ESES 1.48 -0.52 -26.06 3.38 0.66 -27.5
Canada S&P/TSX Comp 15385.96 –19.16 –0.12 0.6 CounterPath CPAH 2.63 0.31 13.36 2.80 1.81 19.5 Under Armour A UAA 21.49 -7.45 -25.74 47.95 20.80 -49.3
Mexico IPC All-Share 47001.06 –90.76 –0.19 3.0 Bellicum Pharmaceuticals BLCM 13.38 1.51 12.72 23.11 7.24 21.7 Under Armour Cl C UA 19.22 -5.87 -23.40 46.20 18.52 ...
Chile Santiago IPSA 3250.28 –7.96 –0.24 0.8 Tilly's TLYS 13.40 1.50 12.61 15.29 5.49 103.0 Rayonier Advanced Matls RYAM 13.57 -3.21 -19.13 17.38 5.88 94.7
Cynosure Cl A CYNO 53.40 5.90 12.42 55.94 32.90 45.6 NL Industries NL 6.00 -1.40 -18.92 9.60 2.01 191.3
Europe Stoxx Europe 600 360.12 –2.43 –0.67 –0.4
Euro zone Euro Stoxx 346.53 –3.05 –0.87 –1.1 Direxion S&P Biotech Bull LABU 40.23 4.40 12.28 55.88 19.00 51.9 Pulmatrix PULM 2.15 -0.50 -18.87 3.89 0.50 -23.8
Belgium Bel-20 3542.27 –22.68 –0.64 –1.8 Capricor Therapeutics CAPR 2.44 0.26 11.93 5.40 1.91 -5.8 Social Reality Cl A SRAX 2.86 -0.54 -15.76 9.40 2.46 -59.4
France CAC 40 4748.90 –35.74 –0.75 –2.3 VivoPower International VVPR 5.20 0.55 11.81 7.08 3.99 ... Spartan Motors SPAR 7.90 -1.45 -15.51 10.50 2.81 159.9
Germany DAX 11535.31 –146.58 –1.25 0.5 Strongbridge Biopharma SBBP 2.45 0.25 11.36 6.39 2.00 -42.2 Real Goods Solar Cl A RGSE 3.87 -0.71 -15.50 528.00 2.90 -98.8
0.07 –4.2 Champions Oncology CSBR 4.75 0.47 10.98 4.75 1.11 34.3 The Bancorp TBBK 5.99 -1.05 -14.91 8.20 3.88 27.4
Israel Tel Aviv 1408.29 1.05
Italy FTSE MIB 18590.73 –168.67 –0.90 –3.3
Netherlands AEX 476.71 –2.82 –0.59 –1.3 Most Active Stocks Volume Movers Ranked by change from 65-day average*
Spain IBEX 35 9315.20 –46.10 –0.49 –0.4
0.40 Volume % chg from Latest Session 52-Week Volume % chg from Latest Session 52-Week
Sweden SX All Share 541.48 2.15 1.3 Company Symbol (000) 65-day avg Close % chg High Low Company Symbol (000) 65-day avg Close % chg High Low
Switzerland Swiss Market 8291.69 –29.14 –0.35 0.9
DryShips DRYS 163,936 4301.1 5.05 105.28 2227.20 1.97 Easterly Acquisition EACQ 824 5053 9.95 0.51 11.85 9.48
U.K. FTSE 100 7099.15 –19.33 –0.27 –0.6
Bank of America BAC 89,192 -25.0 22.64 -1.35 23.55 10.99 Psychemedics PMD 1,201 3193 18.87 -26.35 27.46 9.70
Asia-Pacific DJ Asia-Pacific TSM 1489.94 –4.73 –0.32 4.7 VanEck Vectors Gold Miner GDX 75,324 -7.8 23.93 3.37 31.79 14.11 WT Interest Rt Hdg HY Bd HYZD 446 2410 23.93 -0.08 26.10 19.87
Australia S&P/ASX 200 5620.90 –40.60 –0.72 –0.8 SPDR S&P 500 SPY 65,027 -25.3 227.53 -0.01 229.71 181.09 Under Armour Cl C UA 56,801 2228 19.22 -23.40 46.20 18.52
China Shanghai Composite 3159.17 … Closed 1.8 iShares MSCI Emg Markets EEM 60,640 -4.1 37.34 0.19 38.32 28.60 CS X-Links L/S Equity ETN CSLS 172 2155 26.97 0.07 27.50 25.14
Hong Kong Hang Seng 23360.78 … Closed 6.2 Under Armour Cl C UA 56,801 2227.5 19.22 -23.40 46.20 18.52 New Residential Invt NRZ 53,140 2034 15.15 -3.26 16.43 9.69
India S&P BSE Sensex 27655.96 –193.60 –0.70 3.9 Finl Select Sector SPDR XLF 54,802 -31.6 23.31 -0.64 23.87 15.86 VanEck Vectors Pharm PPH 3,472 1779 52.32 1.57 62.22 50.35
Japan Nikkei Stock Avg 19041.34 –327.51 –1.69 –0.4 Under Armour A UAA 53,866 959.8 21.49 -25.74 47.95 20.80 Summit Midstream Partners SMLP 2,863 1453 23.95 -8.41 26.50 11.06
Singapore Straits Times 3046.80 –18.05 –0.59 5.8 New Residential Invt NRZ 53,140 2033.8 15.15 -3.26 16.43 9.69 WisdomTree Continuous GCC 682 1273 19.84 0.71 20.80 17.73
South Korea Kospi 2067.57 –16.02 –0.77 2.0 DXN DLY GLDMNR 3x BL NUGT 51,259 -1.0 11.08 9.27 35.80 5.02 Korea Equity Fund KEF 205 1016 8.14 0.74 8.73 6.71
Taiwan Weighted 9447.95 … Closed 2.1 * Volumes of 100,000 shares or more are rounded to the nearest thousand * Common stocks priced at $5 a share or more with an average volume over 65 trading days of at least
Sources: SIX Financial Information; WSJ Market Data Group 5,000 shares =Has traded fewer than 65 days

CREDIT MARKETS Currencies CURRENCIES

U.S.-dollar foreign-exchange rates in late New York trading
Consumer Rates and Returns to Investor Benchmark
Treasury Yields
yield curve Forex Race US$vs, US$vs,
andtoRates
Yield maturity of current bills, Yen, euro vs. dollar; dollar vs. Country/currency
Tues YTDchg
in US$ per US$ (%) Country/currency
Tues YTDchg
in US$ per US$ (%)
U.S. consumer rates Selected rates notes and bonds major U.S. trading partners
Americas Thailand baht .02849 35.100 –2.0
A consumer rate against its 5-year CDs Vietnam dong .00004415 22653 –0.5
5.00% Argentina peso .0629 15.8985 0.2
benchmark over the past year 18% Brazil real .3174 3.1508 –3.2 Europe
Bankrate.com avg†: 1.22%
4.00 s Canada dollar .7673 1.3033 –3.0 Czech Rep. koruna .03996 25.024 –2.6
First Internet Bank of Indiana 2.07% 12
Chile peso .001542 648.30 Denmark krone .1452 6.8866
Yen –3.2 –2.6
Five-year CD yields 1.50% Indianapolis, IN 888-873-3424 3.00 6 Euro Colombia peso .0003439 2907.50 –3.1 Euro area euro 1.0798 .9261 –2.6
t s
State Farm Bank 2.10% Ecuador US dollar 1 1 unch Hungary forint .003485 286.97 –2.5
1.00 Tuesday 2.00
t

Bloomington, IL 877-734-2265 0 Mexico peso .0480 20.8326 0.5 Iceland krona .008623 115.97 2.7
Federal-funds Peru new sol .3058 3.271 –2.5 Norway krone .1213 8.2458 –4.6
target rate 0.50 EverBank 2.28% 1.00 –6 Uruguay peso .03555 28.1300 –4.2 Poland zloty .2498 4.0029 –4.4
t s
t

Jacksonville, FL 855-228-6755 One year ago Venezuela b. fuerte .100150 9.9851 –0.1 Russia ruble .01661 60.187 –1.8
0.00 WSJ Dollar index
0.00 Pentagon Federal Credit Union 2.28% –12 Asia-Pacific Sweden krona .1144 8.7427 –4.0
1 3 6 1 2 3 5 710 30 2016 2017 Switzerland franc 1.0106 .9895 –2.9
Alexandria, VA 800-247-5626 Australian dollar .7584 1.3186 –5.0
–0.50 month(s) years Turkey lira .2650 3.7732 7.1
Popular Direct 2.28% China yuan .1453 6.8808 –0.9
FMAM J J A S ON D J maturity Ukraine hryvnia .0369 27.0900 0.03
Hong Kong dollar .1289 7.7606 0.1
2016 New York, NY 800-274-5696 UK pound 1.2578 .7950 –1.9
India rupee .01482 67.468 –0.7
Sources: Ryan ALM; Tullett Prebon; WSJ Market Data Group Middle East/Africa
Indonesia rupiah .0000749 13353 –1.3
Yield/Rate (%) 52-Week Range (%) 3-yr chg Japan yen .008865 112.81 –3.6 Bahrain dinar 2.6539 .3768 –0.1
Interest rate Last (l)Week ago Low 0 2 4 6 8 High (pct pts)
Kazakhstan tenge .003093 323.35 –3.1 Egypt pound .0534 18.7230 3.3
Federal-funds rate target 0.50-.75 0.50-.75 0.25 l 0.75 0.50 Corporate Borrowing Rates and Yields Macau pataca .1256 7.9636 0.6 Israel shekel .2653 3.7694 –2.0
Malaysia ringgit .2257 4.4300 –1.2 Kuwait dinar 3.2779 .3051 –0.2
Prime rate* 3.75 3.75 3.50 l 3.75 0.50 Yield (%) 52-Week Total Return (%)
Bond total return index Close Last Week ago High Low 52-wk 3-yr New Zealand dollar .7313 1.3674 –5.3 Oman sul rial 2.5975 .3850 0.01
Libor, 3-month 1.03 1.04 0.62 l 1.04 0.80 Pakistan rupee .00955 104.745 0.4 Qatar rial .2746 3.642 0.04
Money market, annual yield 0.31 0.28 0.22 l 0.32 -0.10 Treasury, Ryan ALM 1426.553 2.054 2.075 2.186 1.141 –1.776 2.710 Philippines peso .0201 49.715 0.2 Saudi Arabia riyal .2666 3.7503 –0.01
Five-year CD, annual yield 1.22 1.22 1.17 l 1.33 -0.11 10-yr Treasury, Ryan ALM 1690.199 2.451 2.471 2.600 1.366 –7.100 2.910 Singapore dollar .7093 1.4098 –2.6 South Africa rand .0742 13.4751 –1.6
30-year mortgage, fixed† 4.16 4.16 3.43 l 4.29 -0.24 South Korea won .0008683 1151.65 –4.7
DJ Corporate 361.018 3.200 3.218 3.410 2.460 5.027 3.807 Close Net Chg % Chg YTD%Chg
Sri Lanka rupee .0066472 150.44 1.3
15-year mortgage, fixed† 3.36 3.36 2.70 l 3.50 -0.11 Aggregate, Barclays Capital 1879.750 2.620 2.630 2.770 1.820 1.427 2.586 Taiwan dollar .03209 31.166 –4.0 WSJ Dollar Index 90.48 –0.65–0.71 –2.64
Jumbo mortgages, $424,100-plus† 4.52 4.54 4.02 l 4.88 -0.03 High Yield 100, Merrill Lynch n.a. n.a. 5.504 n.a. n.a. n.a. n.a. Sources: Tullett Prebon, WSJ Market Data Group
Five-year adj mortgage (ARM)† 3.58 3.58 2.97 l 4.03 -0.06
Fixed-Rate MBS, Barclays 1937.310 2.930 2.930 3.070 1.930 0.268 2.516
New-car loan, 48-month 3.13 3.09 2.87 l 3.38 0.32
HELOC, $30,000 4.66 4.64 4.29 l 5.01 -0.61
Muni Master, Merrill n.a. n.a. 2.193 n.a. n.a. n.a. n.a. COMMODITIES
Bankrate.com rates based on survey of over 4,800 online banks. *Base rate posted by 70% of the nation's largest EMBI Global, J.P. Morgan n.a. n.a. 5.910 n.a. n.a. n.a. n.a. Commodities Tuesday 52-Week YTD
banks.† Excludes closing costs. Pricing trends on someClose
raw materials, or commodities
Sources: SIX Financial Information; WSJ Market Data Group; Bankrate.com Sources: J.P. Morgan; Ryan ALM; S&P Dow Jones Indices; Barclays Capital; Merrill Lynch Net chg % Chg High Low % Chg % chg

DJ Commodity 573.21 4.22 0.74 580.38 432.69 31.90 1.05

ONLINE 192.04 0.40 195.82 19.89 -0.25

WSJ
TR/CC CRB Index 0.77 155.01
Crude oil, $ per barrel 52.81 0.18 0.34 54.06 26.21 76.74 -1.69
Real-time U.S. stock quotes are available on WSJ.com. Track most-active stocks, new highs/lows, mutual funds and ETFs. Natural gas, $/MMBtu 3.117 -0.115 -3.56 3.93 1.64 53.93 -16.30
.COM
Plus, get deeper money-flows data and email delivery of key stock-market data. All are available free at WSJMarkets.com Gold, $ per troy oz. 1208.60 15.40 1.29 1364.90 1127.30 7.21 5.10
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL. Wednesday, February 1, 2017 | B13

COMMODITIES WSJ.com/commodities

Futures Contracts Open

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

Metal & Petroleum Futures July 3.360 3.363 3.291 3.300 –.092 70,018 March 323.50 334.10 322.70 330.00 5.80 3,023
Oct 3.354 3.354 3.290 3.298 –.089 91,997 May 332.80 343.00 332.00 339.40 5.30 751 Currency Futures
Contract Open Milk (CME)-200,000 lbs., cents per lb.
Open High hi lo Low Settle Chg interest Japanese Yen (CME)-¥12,500,000; $ per 100¥
Agriculture Futures Jan 16.75 16.76 16.74 16.75 .01 4,249 March .8802 .8933 s .8786 .8883 .0075 192,141
Copper-High (CMX)-25,000 lbs.; $ per lb. Feb 16.61 16.74 t 16.44 16.71 .15 4,237 June .8842 .8973 s .8827 .8925 .0075 8,760
Feb 2.6580 2.7205 2.6580 2.7215 0.0740 2,483 Corn (CBT)-5,000 bu.; cents per bu. Cocoa (ICE-US)-10 metric tons; $ per ton. Canadian Dollar (CME)-CAD 100,000; $ per CAD
March 2.6700 2.7375 s 2.6595 2.7275 0.0725 147,732 March 358.50 361.25 357.75 359.75 2.00 590,878 March 2,072 2,150 t 2,072 2,103 25 108,381 March .7629 .7715 s .7624 .7683 .0052 105,016
Gold (CMX)-100 troy oz.; $ per troy oz. May 365.25 368.50 365.00 367.00 2.00 243,074 May 2,072 2,144 t 2,072 2,102 23 64,559 June .7648 .7723 s .7634 .7692 .0052 2,312
Feb 1194.90 1214.70 1193.50 1208.60 15.40 6,455 Oats (CBT)-5,000 bu.; cents per bu. Coffee (ICE-US)-37,500 lbs.; cents per lb. British Pound (CME)-£62,500; $ per £
April 1197.70 1217.40 1195.60 1211.40 15.40 263,159 March 245.00 247.50 243.00 244.25 .50 4,672 March 151.00 152.50 146.60 149.55 –1.60 67,746 March 1.2502 1.2606 1.2421 1.2591 .0097 210,251
June 1201.00 1220.50 1198.90 1214.50 15.40 58,590 May 237.75 242.25 236.75 238.75 .50 2,373 May 153.60 155.00 149.20 152.00 –1.70 57,934 June 1.2540 1.2634 1.2453 1.2622 .0096 1,461
Aug 1205.10 1223.00 1205.10 1217.70 15.40 15,791 Soybeans (CBT)-5,000 bu.; cents per bu. Sugar-World (ICE-US)-112,000 lbs.; cents per lb. Swiss Franc (CME)-CHF 125,000; $ per CHF
Dec 1211.70 1229.80 1211.50 1223.90 15.40 27,011 March 1023.00 1026.50 1019.50 1024.50 1.75 324,578 March 20.37 20.53 20.25 20.45 .14 274,869 March 1.0073 1.0163 s 1.0055 1.0136 .0065 46,364
Feb'18 1219.00 1228.40 1219.00 1227.20 15.40 4,395 May 1032.75 1036.75 1029.50 1034.25 1.50 146,588 May 20.37 20.53 20.30 20.46 .09 182,292 June 1.0124 1.0220 s 1.0119 1.0198 .0065 138
Palladium (NYM) - 50 troy oz.; $ per troy oz. Soybean Meal (CBT)-100 tons; $ per ton. Sugar-Domestic (ICE-US)-112,000 lbs.; cents per lb. Australian Dollar (CME)-AUD 100,000; $ per AUD
Feb 732.85 732.85 732.85 754.35 15.85 5 March 334.70 335.70 332.60 334.60 .20 163,859 March 31.00 31.00 s 30.75 30.18 –.16 1,552 March .7551 .7598 .7535 .7578 .0032 99,716
March 739.60 759.00 738.90 754.30 15.85 25,908 May 337.60 338.50 335.50 337.90 .40 91,749 May 30.50 30.50 30.50 30.50 –.04 881 June .7540 .7581 .7520 .7562 .0032 771
June 740.00 759.50 740.00 755.40 15.85 2,552 Soybean Oil (CBT)-60,000 lbs.; cents per lb. Cotton (ICE-US)-50,000 lbs.; cents per lb. Sept .7482 .7510 .7482 .7549 .0031 683
Platinum (NYM)-50 troy oz.; $ per troy oz. March 33.65 34.17 33.55 33.85 .24 174,260 March 74.16 75.13 74.10 74.94 .80 153,824 Mexican Peso (CME)-MXN 500,000; $ per MXN
Feb 978.80 979.10 978.80 993.00 3.20 95 May 33.92 34.45 33.83 34.14 .24 92,073 May 74.85 75.75 74.80 75.60 .78 58,841 March .04782 .04812 .04758 .04770 –.00019 137,551
April 991.80 1002.80 989.30 996.50 3.00 58,754 Rough Rice (CBT)-2,000 cwt.; $ per cwt. Orange Juice (ICE-US)-15,000 lbs.; cents per lb. June .04735 .04741 .04693 .04702 –.00018 47,957
Silver (CMX)-5,000 troy oz.; $ per troy oz. March 971.00 974.50 952.50 953.50 –23.00 10,025 March 177.40 177.40 171.95 172.90 –4.95 8,781 Euro (CME)-€125,000; $ per €
Feb 17.330 17.560 s 17.330 17.512 0.390 246 May 995.50 1001.00 978.50 979.50 –22.50 1,353 May 172.95 172.95 168.60 169.55 –4.25 2,221 March 1.0718 1.0829 s 1.0702 1.0821 .0110 390,539
March 17.130 17.635 s 17.105 17.543 0.391 132,028 Wheat (CBT)-5,000 bu.; cents per bu. June 1.0772 1.0880 s 1.0754 1.0873 .0110 9,403
Crude Oil, Light Sweet (NYM)-1,000 bbls.; $ per bbl. March 414.00 421.25 413.00 420.75 6.75 242,276 Interest Rate Futures
March 52.60 53.56 52.24 52.81 0.18 574,920 May 427.75 434.00 427.00 433.50 5.25 93,976 Index Futures
April 53.23 54.20 52.90 53.42 0.18 188,354 Wheat (KC)-5,000 bu.; cents per bu. Treasury Bonds (CBT)-$100,000; pts 32nds of 100%
May 53.76 54.74 53.47 53.94 0.16 170,754 March 426.25 430.25 423.75 429.50 3.75 91,919 March 150-050 151-060 149-240 150-270 19.0 614,032 Mini DJ Industrial Average (CBT)-$5 x index
July 452.25 454.75 448.25 454.25 4.00 66,202 June 148-280 149-270 148-160 149-190 18.0 1,879 March 19883 19891 19713 19792 –96 127,406
June 54.32 55.20 53.95 54.38 0.14 270,204
Wheat (MPLS)-5,000 bu.; cents per bu. June 19813 19828 19654 19731 –98 736
Dec 55.12 56.10 54.95 55.33 0.12 214,909 Treasury Notes (CBT)-$100,000; pts 32nds of 100%
Dec'18 55.37 56.12 55.09 55.41 0.09 115,172 March 550.75 554.25 547.75 548.50 –2.75 28,455 March 124-045 124-215 124-020 124-150 8.0 3,153,754
S&P 500 Index (CME)-$250 x index
March 2276.00 2276.30 2262.50 2274.50 –1.50 62,476
NY Harbor ULSD (NYM)-42,000 gal.; $ per gal. May 550.00 552.75 546.50 547.50 –2.00 26,079 June 123-220 124-040 123-200 123-290 8.0 28,233
June 2263.00 2271.40 2255.90 2269.30 –1.60 1,773
Feb 1.6050 1.6428 1.6000 1.6117 .0050 5,581 Cattle-Feeder (CME)-50,000 lbs.; cents per lb. 5 Yr. Treasury Notes (CBT)-$100,000; pts 32nds of 100% Mini S&P 500 (CME)-$50 x index
March 1.6229 1.6617 1.6163 1.6308 .0066 134,726 March 123.800 t 122.325 122.775 –1.125 23,945
124.525 March 117-222 117-312 117-217 117-277 3.7 3,099,459 March 2275.75 2276.75 2262.25 2274.50 –1.50 2,805,447
Gasoline-NY RBOB (NYM)-42,000 gal.; $ per gal. May 122.025 t 120.900 121.325 –.825
122.800 9,482 June 117-175 117-185 117-162 117-160 4.2 54,018 June 2271.25 2271.50 2257.25 2269.25 –1.75 31,392
Feb 1.5041 1.5513 1.5024 1.5256 .0201 4,053 Cattle-Live (CME)-40,000 lbs.; cents per lb. 2 Yr. Treasury Notes (CBT)-$200,000; pts 32nds of 100% Mini S&P Midcap 400 (CME)-$100 x index
March 1.5293 1.5789 1.5262 1.5501 .0170 157,577 Feb 116.050 116.575 115.450 115.600 –.575 39,435 March 108-120 108-140 108-117 108-127 .5 1,286,009 March 1680.60 1688.90 1670.30 1685.50 4.90 95,906
Natural Gas (NYM)-10,000 MMBtu.; $ per MMBtu. April 114.700 115.125 114.000 114.175 –.650 150,435 30 Day Federal Funds (CBT)-$5,000,000; 100 - daily avg. Mini Nasdaq 100 (CME)-$20 x index
March 3.224 3.235 t 3.110 3.117 –.115 289,649 Hogs-Lean (CME)-40,000 lbs.; cents per lb. Jan 99.350 99.353 t 99.350 99.350 … 161,338 March 5123.5 5135.0 5083.3 5112.8 –11.8 235,837
April 3.260 3.271 3.159 3.165 –.106 117,574 Feb 67.200 69.300 s 67.150 69.075 1.975 23,593 April 99.285 99.295 99.285 99.290 .005 324,756 June 5120.3 5131.0 5083.8 5112.0 –11.8 529
May 3.295 3.302 3.199 3.208 –.097 110,347 April 68.550 70.200 68.425 69.250 1.025 93,566 10 Yr. Del. Int. Rate Swaps (CBT)-$100,000; pts 32nds of 100% Mini Russell 2000 (ICE-US)-$100 x index
June 3.315 3.325 3.246 3.259 –.092 58,895 Lumber (CME)-110,000 bd. ft., $ per 1,000 bd. ft. March 93.734 94.125 93.656 93.969 .313 32,082 March 1349.80 1363.40 1342.30 1359.50 9.60 638,683
1 Month Libor (CME)-$3,000,000; pts of 100% June 1341.50 1361.70 1341.50 1357.00 9.60 518
Feb 99.2175 99.2175 s 99.2150 99.2200 … 4,821 Mini Russell 1000 (ICE-US)-$100 x index
Eurodollar (CME)-$1,000,000; pts of 100% March 1260.10 1265.00 1256.80 1262.60 –1.00 7,756
Cash Prices | WSJ.com/commodities Tuesday, January 31, 2017 Feb 98.9575 98.9575 98.9525 98.9550 .0025 90,710 U.S. Dollar Index (ICE-US)-$1,000 x index
March 100.39 100.51 t 99.40 99.48 –.93 73,119
March 98.9200 98.9300 98.9150 98.9250 .0050 1,428,611
These prices reflect buying and selling of a variety of actual or “physical” commodities in the marketplace— June 98.7550 98.7750 98.7500 98.7700 .0100 1,375,085
June 100.30 100.42 t 99.33 99.43 –.90 2,109
separate from the futures price on an exchange, which reflects what the commodity might be worth in future Dec 98.4800 98.5100 98.4750 98.5000 .0150 1,369,032
Source: SIX Financial Information
months.
Tuesday Tuesday Tuesday

Energy (U.S.$ equivalent)

Coins,wholesale $1,000 face-a
17.2900
13704
Soybeans,No.1 yllw IL-bp,u
Wheat,Spring14%-pro Mnpls-u
9.9500
6.4500
Bonds | WSJ.com/bonds
Propane,tet,Mont Belvieu-g 0.8439 Other metals Wheat,No.2 soft red,St.Louis-bp,u 4.1600
Butane,normal,Mont Belvieu-g 1.1176 LBMA Platinum Price PM *979.0 Wheat - Hard - KC (USDA) $ per bu-u 3.6850 Tracking Bond Benchmarks
NaturalGas,HenryHub-i 3.000 Platinum,Engelhard industrial 993.0 Wheat,No.1soft white,Portld,OR-u 4.6338
NaturalGas,TranscoZone3-i 2.960 Platinum,Engelhard fabricated 1093.0
Return on investment and spreads over Treasurys and/or yields paid to investors compared with 52-week
Palladium,Engelhard industrial 760.0
Food highs and lows for different types of bonds
NaturalGas,TranscoZone6NY-i 3.010
NaturalGas,PanhandleEast-i 2.840 Palladium,Engelhard fabricated 860.0 Beef,carcass equiv. index Total Total
NaturalGas,Opal-i 2.890 Aluminum, LME, $ per metric ton *1807.0 choice 1-3,600-900 lbs.-u 179.97 return YTD total Yield (%) return YTD total Yield (%)
NaturalGas,MarcellusNE PA-i 2.680 Copper,Comex spot 2.7215 select 1-3,600-900 lbs.-u 175.89 close return (%) Index Latest Low High close return (%) Index Latest Low High
NaturalGas,HaynesvilleN.LA-i 2.870 Iron Ore, 62% Fe CFR China-s 82.4 Broilers,dressed 'A'-u n.a.
Shredded Scrap, US Midwest-s,w 312 Broilers, National comp wghtd-u,w 0.8336 Broad Market Bloomberg Barclays Mortgage-Backed Bloomberg Barclays
Coal,C.Aplc.,12500Btu,1.2SO2-r,w 50.000
Coal,PwdrRvrBsn,8800Btu,0.8SO2-r,w 11.800 Steel, HRC USA, FOB Midwest Mill-s 631 Butter,AA Chicago 2.2400 1937.31 -0.1 Mortgage-Backed 2.930 1.930 3.070
Cheddar cheese,bbl,Chicago 151.75 1879.75 0.2 U.S. Aggregate 2.620 1.820 2.770
Metals Fibers and Textiles Cheddar cheese,blk,Chicago 170.75 U.S. Corporate Indexes Bloomberg Barclays 1917.61 0.01 Ginnie Mae (GNMA) 2.860 1.850 2.990
Burlap,10-oz,40-inch NY yd-n,w 0.5700 Milk,Nonfat dry,Chicago lb. 94.50
Gold, per troy oz Cocoa,Ivory Coast-w n.a. 2635.13 0.3 U.S. Corporate 3.360 2.750 3.710 1132.56 -0.1 Fannie mae (FNMA) 2.950 1.950 3.090
Cotton,1 1/16 std lw-mdMphs-u 0.7444
Engelhard industrial 1208.70 Coffee,Brazilian,Comp 1.4942
Cotlook 'A' Index-t *84.25 2529.02 0.4 Intermediate 2.830 2.190 3.110 1743.91 -0.1 Freddie Mac (FHLMC) 2.970 1.980 3.110
Engelhard fabricated 1299.35 Coffee,Colombian, NY 1.6957
Hides,hvy native steers piece fob-u 76.000
Handy & Harman base 1212.80 0.7850 n.a. n.a. Muni Master n.a. n.a. n.a.
Wool,64s,staple,Terr del-u,w n.a. Eggs,large white,Chicago-u 3511.05 0.1 Long term 4.550 3.960 5.130
Handy & Harman fabricated 1346.20 Flour,hard winter KC 13.95
LBMA Gold Price AM *1189.85 Grains and Feeds Hams,17-20 lbs,Mid-US fob-u n.a. 541.68 0.2 Double-A-rated 2.730 1.980 2.870 n.a. n.a. 7-12 year n.a. n.a. n.a.
LBMA Gold Price PM *1192.80 Hogs,Iowa-So. Minnesota-u 67.31
Barley,top-quality Mnpls-u n.a. 673.47 0.5 Triple-B-rated 3.680 3.180 4.450 n.a. n.a. 12-22 year n.a. n.a. n.a.
Krugerrand,wholesale-e 1258.24 Pork bellies,12-14 lb MidUS-u n.a.
Bran,wheat middlings, KC-u 95
Maple Leaf-e 1270.34 Pork loins,13-19 lb MidUS-u 0.9183 High Yield Bonds Merrill Lynch n.a. n.a. 22-plus year n.a. n.a. n.a.
Corn,No. 2 yellow,Cent IL-bp,u 3.4300
American Eagle-e 1270.34 Corn gluten feed,Midwest-u,w 100.0 Steers,Tex.-Okla. Choice-u n.a.
Mexican peso-e 1466.72 Steers,feeder,Okla. City-u,w 145.27 n.a. n.a. High Yield Constrained n.a. n.a. n.a. Global Government J.P. Morgan†
Corn gluten meal,Midwest-u,w 502.1
Austria crown-e 1188.89 230
Cottonseed meal-u,w Fats and Oils n.a. n.a. Triple-C-rated n.a. n.a. n.a. 532.92 -0.8 Global Government 1.490 0.750 1.520
Austria phil-e 1270.34 Hominy feed,Cent IL-u,w 80
Silver, troy oz. Meat-bonemeal,50% pro Mnpls-u,w 288 Corn oil,crude wet/dry mill-u,w 38.0250 n.a. n.a. High Yield 100 n.a. n.a. n.a. 750.92 -0.3 Canada 1.930 0.770 1.980
Engelhard industrial 17.4300 Oats,No.2 milling,Mnpls-u 2.9675 Grease,choice white,Chicago-u 0.2750
20.9160 n.a. n.a. n.a. Global High Yield Constrained n.a. n.a. n.a. 361.21 -2.1 EMU§ 1.272 0.512 1.282
Engelhard fabricated Rice, 5% Broken White, Thailand-l,w 357.00 Lard,Chicago-u
Handy & Harman base 17.5450 Rice, Long Grain Milled, No. 2 AR-u,w 21.00 Soybean oil,crude;Centl IL-u 0.3220 n.a. n.a. Europe High Yield Constrained n.a. n.a. n.a. 688.00 -2.6 France 1.110 0.270 1.110
Handy & Harman fabricated 21.9310 Sorghum,(Milo) No.2 Gulf-u 6.9600 Tallow,bleach;Chicago-u 0.3125
LBMA spot price £13.8686 SoybeanMeal,Cent IL,rail,ton48%-u 332.60 Tallow,edible,Chicago-u n.a. U.S Agency Bloomberg Barclays 507.78 -1.3 Germany 0.440 -0.100 0.490
1609.05 0.3 U.S Agency 1.740 1.150 1.910 286.19 -0.7 Japan 0.420 -0.120 0.510
KEY TO CODES: A=ask; B=bid; BP=country elevator bids to producers; C=corrected; E=Manfra,Tordella & Brooks; G=ICE; I=Natural Gas Intelligence;
L=livericeindex.com; M=midday; N=nominal; n.a.=not quoted or not available; R=SNL Energy; S=The Steel Index; T=Cotlook Limited; U=USDA; W=weekly, Z=not quoted. 1449.53 0.3 10-20 years 1.540 0.960 1.710 556.53 -1.7 Netherlands 0.630 0.020 0.680
*Data as of 1/30
Source: WSJ Market Data Group 3145.33 0.8 20-plus years 3.260 2.390 3.460 896.57 -1.8 U.K. 1.710 0.960 2.060
2350.54 0.4 Yankee 2.920 2.320 3.090 n.a. n.a. Emerging Markets ** n.a. n.a. n.a.
Exchange-Traded Portfolios | WSJ.com/ETFresearch *Constrained indexes limit individual issuer concentrations to 2%; the High Yield 100 are the 100 largest bonds † In local currency § Euro-zone bonds
** EMBI Global Index Sources: Merrill Lynch; Bloomberg Barclays; J.P.Morgan
Closing Chg YTD
Largest 100 exchange-traded funds, latest session ETF Symbol Price (%) (%)

Tuesday, January 31, 2017 Closing Chg YTD TechSelectSector XLK 50.08 –0.50 3.6
Global Government Bonds: Mapping Yields
ETF Symbol Price (%) (%) UtilitiesSelSector XLU 49.18 1.55 1.3
Closing Chg YTD Yields and spreads over or under U.S. Treasurys on benchmark two-year and 10-year government bonds in
ETF Symbol Price (%) (%) VanEckBiotech BBH 113.97 2.62 5.9
iSharesMSCIEAFEETF EFA 59.63 0.15 3.3
iShMSCIEmgMarkets EEM 37.34 0.19 6.7
VanEckGoldMiner GDX 23.93 3.37 14.4 selected other countries; arrows indicate whether the yield rose(s) or fell (t) in the latest session
AlerianMLPETF AMLP 13.01 0.15 3.3
VanEckOilSvcs OIH 33.36 0.76 0.0
CnsmrDiscSelSector XLY 84.83 –0.15 4.2 iShMSCIEurozoneETF EZU 35.34 0.14 2.1 Country/ Yield (%) Spread Under/Over U.S. Treasurys, in basis points
VanEckPharm PPH 52.32 1.57 –0.4 Coupon (%) Maturity, in years Latest(l) 0 20 40 60 80 100 120 Previous Month ago Year ago Latest Prev Year ago
CnsStapleSelSector XLP 52.59 0.48 1.7 iShMSCIJapanETF EWJ 50.57 –0.24 3.5
VanEckRetail RTH 76.58 0.29 1.0
DBGoldDoubleLgETN DGP 22.22 2.59 10.4 iShNasdaqBiotech IBB 278.07 2.84 4.8
VanEckSemiconduc SMH 74.44 –1.39 3.9
1.125 U.S. 2 1.204 t l 1.216 1.206 0.778
DBGoldDoubleShrt DZZ 6.13 –3.01 –10.6 iShNatlAMTFrMuniBd MUB 108.46 0.14 0.3
VangdInfoTech VGT 126.74 –0.48 4.3 2.000 10 2.450 t l 2.488 2.445 1.924
DeutscheXMSCIEAFE DBEF 28.26 –0.53 0.7 iShRussell1000Gwth IWF 108.35 –0.07 3.3
VangdSC Val VBR 121.79 0.40 0.7 5.250 Australia 2 1.790 t 1.821 1.834 1.907 60.5 113.0
EnSelectSectorSPDR XLE 72.90 0.04 –3.2 iShRussell1000ETF IWB 126.86 –0.02 1.9 l 58.5
iShRussell1000Val IWD 112.71 0.12 0.6 VangdDivApp VIG 86.68 –0.06 1.8
FinSelSectorSPDR XLF 23.31 –0.64 0.3 4.750 10 2.718 t 2.731 2.765 2.590 24.3 66.7
VanguardFTSEDevMk VEA 37.88 0.34 3.7
l 26.8
GuggenheimSP500EqW RSP 88.38 0.16 2.0 iShRussell2000Gwth IWO 156.24 0.85 1.5
HealthCareSelSect XLV 70.52 1.60 2.3 iShRussell2000ETF IWM 135.23 0.70 0.3 VanguardFTSEEmgMk VWO 37.84 0.05 5.8 0.000 France 2 -0.497 t l -0.419 -0.704 -0.395 -170.1 -163.5 -117.3
iShRussell2000Val 117.93 0.44 –0.8 VanguardFTSEEurope VGK 49.36 0.49 3.0
IndSelSectorSPDR XLI 63.38 –0.88 1.9 IWN 0.250 10 1.036 t l 1.056 0.688 0.646 -143.3 -127.7
VanguardAWxUS VEU 46.01 0.28 4.1 -141.4
iShIntermCredBd CIU 108.69 0.16 0.5 iShRussell3000ETF IWV 135.38 0.07 1.8
iSh1-3YCreditBond CSJ 105.14 0.06 0.2 iShRussellMid-Cap IWR 183.11 0.28 2.4 VangdGrowth VUG 115.41 ... 3.5 0.000 Germany 2 -0.707 t l -0.683 -0.786 -0.483 -191.1 -189.9 -126.1
114.18 0.21 0.9 iShRussellMCValue IWS 81.76 0.36 1.7 VanguardHiDiv VYM 75.74 –0.12 –0.0
iSharesTIPSBondETF TIP
VanguardIntrm BIV 83.34 0.36 0.3
0.250 10 0.442 t l 0.453 0.207 0.327 -200.8 -203.6 -159.6
iShCoreHiDividend HDV 81.65 –0.01 –0.7 iShS&P500Growth IVW 125.35 –0.16 2.9
iShCoreMSCIEAFEETF IEFA 55.44 0.11 3.4 iShS&P500ValueETF IVE 101.97 0.11 0.6 VangIntrCorpBd VCIT 86.01 0.31 0.4 0.300 Italy 2 0.024 t l 0.062 -0.187 -0.016 -118.1 -115.4 -79.4
45.24 0.24 6.6 iShUSPfdStk 38.10 0.32 2.4 VanguardLC VV 104.36 –0.04 1.9
iShCoreMSCIEmgMk IEMG PFF 1.250 10 2.277 t l 2.321 1.822 1.420 -17.3 -16.8 -50.3
iShCoreS&P500ETF IVV 228.93 –0.04 1.8 iSh1-3YTreasuryBd SHY 84.54 0.02 0.1 VanguardMC VO 135.52 0.24 3.0
iShCoreS&PMdCp IJH 168.17 0.29 1.7 iSh7-10YTreasuryBd IEF 105.05 0.34 0.2 VanguardMCVal VOE 99.30 0.41 2.2 0.100 Japan 2 -0.203 s l -0.215 -0.182 -0.075 -140.7 -143.1 -85.2
68.36 0.68 –0.6 iShRussellMCGrowth 100.60 0.17 3.3 VangdREIT VNQ 82.37 0.72 –0.2
iShCoreS&PSmCpETF IJR IWP 0.100 10 0.090 s l 0.085 0.042 0.102 -236.0 -240.3 -182.1
iShS&PTotlUSStkMkt ITOT 52.32 0.17 2.0 PwrShrs QQQ QQQ 124.57 –0.20 5.1 VanguardS&P500 VOO 208.97 –0.00 1.8
iShCoreUSAggBd AGG 108.29 0.24 0.2 PS SP500LoVoltlPrt SPLV 41.82 0.38 0.6 VangdST Bond BSV 79.68 0.06 0.3 0.250 Spain 2 -0.297 t l -0.254 -0.307 -0.009 -150.2 -147.0 -78.6
89.76 0.66 1.3 23.30 –0.09 –0.3 VanguardSTCpBd VCSH 79.62 0.13 0.3
iShSelectDividend DVY PwrShSrLoanPtf BKLN 1.300 10 1.598 t l 1.617 1.399 1.524 -85.2 -87.1 -39.9
iShEdgeMSCIMinEAFE EFAV 63.17 0.40 3.2 SPDRBloomBarcHYBd JNK 36.91 –0.03 1.3 VanguardSC VB 130.93 0.57 1.5
iShEdgeMSCIMinUSA USMV 45.79 0.24 1.3 SchwIntlEqty SCHF 28.69 0.28 3.6 VanguardTotBd BND 80.94 0.21 0.2 1.250 U.K. 2 0.125 t l 0.146 0.053 0.319 -108.0 -107.0 -45.9
11.67 1.30 5.3 55.21 0.05 1.9 VanguardTotIntlBd BNDX 53.76 0.19 –1.0
iSharesGold IAU SchwUS BrdMkt SCHB 4.250 10 1.517 t l 1.540 1.096 1.562 -93.2 -94.8 -36.2
iShiBoxx$InvGrCpBd LQD 117.35 0.18 0.1 SchwUS LrgCap SCHX 54.32 –0.02 2.0 VanguardTtlIntlStk VXUS 47.75 0.23 4.1
iShiBoxx$HYCpBd HYG 87.34 –0.10 0.9 SPDR DJIA Tr DIA 198.36 –0.51 0.4 VanguardTotStk VTI 117.46 0.09 1.9 Source: Tullett Prebon
iSharesJPMUSDEmgBd
iShMBSETF
EMB
MBB
112.13
106.44
0.37
0.18
1.7
0.1
SPDR GldTr
SPDR S&PMdCpTr
GLD
MDY
115.55
306.70
1.39
0.34
5.4
1.6
VangdTotlWrld
VangdValue
VT
VTV
62.83
93.47
0.18
–0.05
3.0
0.5
Corporate Debt
iShMSCIACWIETF ACWI 60.89 0.15 2.9 SPDR S&P 500 SPY 227.53 –0.01 1.8 WisdTrEuropeHdg HEDJ 57.43 –0.81 0.1 Price moves by a company’s debt in the credit markets sometimes mirror and sometimes anticipate moves in
iSharesMSCIEAFESC SCZ 51.75 0.45 3.8 SPDR S&P Div SDY 86.18 0.16 0.7 WisdTrJapanHdg DXJ 49.87 –0.85 0.7 that same company’s share price. Here’s a look at both for two companies in the news.
Investment-grade spreads that tightened the most…
Borrowing Benchmarks | WSJ.com/bonds Issuer Symbol Coupon (%) Maturity Current
Spread*, in basis points
One-day change Last week
Stock Performance
Close ($) % chg

6.350 May 15, ’67 3343 –285 4367 ... ...

Money Rates January 31, 2017 Transcanada Pipelines
Citigroup
TRPCN
C 5.350 May 15, ’49 260 –16 289 55.83 –1.38
Key annual interest rates paid to borrow or lend money in U.S. and international markets. Rates below are a Commerzbank AG CMZB 8.125 Sept. 19, ’23 348 –16 n.a. ... ...
guide to general levels but don’t always represent actual transactions. Deutsche Bank AG DB 4.500 April 1, ’25 284 –11 295 19.91 –0.99
General Motors Financial GM 3.450 Jan. 14, ’22 150 –11 160 … …
Week —52-WEEK— Week —52-WEEK— HSBC Holdings HSBC 3.400 March 8, ’21 98 –10 103 42.60 0.24
Inflation Latest ago High Low Latest ago High Low
Dec. index Chg From (%) Lam Research LRCX 2.800 June 15, ’21 85 –10 n.a. 114.86 –0.98
level Nov. '16 Dec. '15 Secondary market Euro interbank offered rate (Euribor) Bank of America BAC 5.200 June 1, ’49 243 –9 261 22.64 –1.35

U.S. consumer price index Fannie Mae One month -0.372 -0.372 -0.231 -0.374 …And spreads that widened the most
0.03 2.1 30-year mortgage yields Three month -0.327 -0.328 -0.161 -0.329
All items 241.432 Bbva Bancomer S.A. de C.V. BBVASM 7.250 April 22, ’20 282 30 268 ... ...
Core 249.134 –0.04 2.2 30 days 3.688 3.658 3.828 2.806 Six month -0.243 -0.242 -0.094 -0.244
Bank of America BAC 8.000 Jan. 30, ’49 141 28 n.a. 22.64 –1.35
60 days 3.719 3.690 3.862 2.832 One year -0.101 -0.101 0.009 -0.102
International rates JPMorgan Chase JPM 5.150 May 1, ’49 243 25 258 84.63 –1.63
Other short-term rates Value 52-Week Under Armour UAA 3.250 June 15, ’26 180 22 154 21.49 –25.74
Week 52-Week Latest Traded High Low
Latest High Low
AT&T T 6.375 March 1, ’41 240 20 221 42.16 0.81
ago Week 52-Week
Latest ago high low DTCC GCF Repo Index Abbott Laboratories ABT 5.125 April 1, ’19 99 16 85 41.77 1.85
Prime rates Microsoft MSFT 1.550 Aug. 8, ’21 39 16 35 64.65 –0.74
Treasury 0.695 46.150 1.266 0.244
U.S. 3.75 3.75 3.75 3.50 Call money
Canada 2.70 2.70 2.70 2.70 2.50 2.50 2.50 2.25
MBS 0.722 82.350 1.328 0.257 High-yield issues with the biggest price increases…
Japan 1.475 1.475 1.475 1.475 Open Implied Bond Price as % of face value Stock Performance
Commercial paper Settle Change Interest Rate Issuer Symbol Coupon (%) Maturity Current One-day change Last week Close ($) % chg
Policy Rates 30 to 270 days n.q. ... ... ... Linn Energy LINE 6.500 Sept. 15, ’21 50.000 17.00 44.750 ... ...
Euro zone 0.00 0.00 0.05 0.00 DTCC GCF Repo Index Futures
Commercial paper (AA financial) Peabody Energy BTU 6.000 Nov. 15, ’18 40.250 6.25 50.875 ... ...
Switzerland 0.50 0.50 0.50 0.50 Treasury Jan 99.399 -0.006 5649 0.601
Britain 0.25 0.25 0.50 0.25 90 days 0.91 0.87 1.03 0.45 Intelsat Connect Finance S.A. INTEL 12.500 April 1, ’22 64.563 2.31 60.000 ... ...
Treasury Feb 99.410 unch. 8718 0.590 Ep Energy EPENEG 9.375 May 1, ’20 101.750 2.00 96.450 ... ...
Australia 1.50 1.50 2.00 1.50
Euro commercial paper Treasury Mar 99.320 0.005 3105 0.680
Navios Maritime Holdings NM 7.375 Jan. 15, ’22 70.000 1.50 62.500 1.96 0.51
Overnight repurchase 30 day n.q. n.q. -0.13 -0.14 Chs/Community Health Systems CYH 6.875 Feb. 1, ’22 73.875 1.08 71.063 … …
U.S. 0.61 0.60 1.30 0.15 Two month n.q. n.q. n.q. n.q.
Notes on data: Pacific Drilling V PACD 7.250 Dec. 1, ’17 59.000 1.00 53.250 … …
Three month n.q. n.q. n.q. n.q.
U.S. government rates Four month n.q. n.q. n.q. n.q. Royal Caribbean Cruises RCL 5.250 Nov. 15, ’22 108.500 0.73 107.000 93.63 –0.82
U.S. prime rate is effective December 15, 2016.
Five month n.q. n.q. n.q. n.q. Discount rate is effective December 15, 2016.
Discount
Six month n.q. n.q. n.q. n.q. U.S. prime rate is the base rate on corporate …And with the biggest price decreases
1.25 1.25 1.25 1.00 loans posted by at least 70% of the 10 largest
U.S. banks; Hexion HXN 13.750 Feb. 1, ’22 100.000 –1.50 n.a. ... ...
Libor
Federal funds Other prime rates aren’t directly comparable; Transocean RIG 6.800 March 15, ’38 80.500 –1.50 78.500 13.97 0.87
One month 0.77944 0.77111 0.78000 0.42650 lending practices vary widely by location; ACOSTA 7.750
Effective rate 0.6000 0.6900 0.7000 0.2700 Acosta Oct. 1, ’22 88.250 –1.25 84.250 ... ...
Three month 1.03456 1.03789 1.04344 0.61720 DTCC GCF Repo Index is Depository Trust &
High 0.8125 0.8125 0.8125 0.5600 Clearing Corp.'s weighted average for overnight GameStop GME 6.750 March 15, ’21 102.500 –1.25 102.000 24.49 1.28
Low 0.5000 0.5000 0.6600 0.2000 Six month 1.34739 1.35239 1.36183 0.85785
trades in applicable CUSIPs. Value traded is in L Brands LB 6.750 July 1, ’36 96.250 –1.25 98.500 60.21 2.55
Bid 0.5600 0.6600 0.6800 0.2000 One year 1.71344 1.72122 1.73289 1.11560 billions of U.S. dollars.
0.7500 0.7500 0.2600 Futures on the DTCC GCF Repo Index are Genworth Financial GNW 6.515 May 22, ’18 97.500 –1.06 99.688 3.36 1.82
Offer 0.5800
Euro Libor traded on NYSE Liffe US. Avaya AVYA 7.000 April 1, ’19 83.000 –1.00 84.750 ... ...
Treasury bill auction One month -0.383 -0.383 -0.233 -0.386 Sources: Federal Reserve; Bureau of Labor General Cable BGC 5.750 Oct. 1, ’22 98.750 –1.00 99.500 … …
4 weeks 0.490 0.480 0.520 0.160 Three month -0.344 -0.341 -0.181 -0.345 Statistics; DTCC; SIX Financial Information;
*Estimated spread over 2-year, 3-year, 5-year, 10-year or 30-year hot-run Treasury; 100 basis points=one percentage pt.; change in spread shown is for Z-spread.
13 weeks 0.515 0.505 0.555 0.220 Six month -0.242 -0.240 -0.107 -0.242 General Electric Capital Corp.; Tullett Prebon Note: Data are for the most active issue of bonds with maturities of two years or more
26 weeks 0.625 0.600 0.660 0.340 One year -0.102 -0.096 0.000 -0.102 Information, Ltd. Sources: MarketAxess Corporate BondTicker; WSJ Market Data Group
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
B14 | Wednesday, February 1, 2017
Brevan Howard Sees
$4.4 Billion Outflow
BY LAURENCE FLETCHER
LONDON—Investors pulled
more than $4 billion from
Brevan Howard Asset Man-
agement LLP in the second
half of 2016, the latest sign
they are becoming tired of
lackluster performance by the
hedge-fund industry.
Brevan, run by the Swit-
zerland-based British billion-
aire Alan Howard, had about
$4.4 billion of net outflows in
its flagship Master fund in
the six months to the end of
December, according to calcu-
lations by The Wall Street
Journal based on letters to
investors.
A spokesman for Brevan de-
clined to comment.
The Master fund was once
widely regarded as the gold
standard for the hedge-fund
industry because of its impres-
sive record. It racked up 11
consecutive calendar years of
gains to 2013, including large
profits during the credit crisis.
3%
Last year’s gain for Brevan
Howard’s flagship fund
But like many macro
funds—portfolios that trade
global bonds, currencies and
stocks—Brevan has struggled
in recent years to find ways to
profit given a backdrop of
loose monetary policy from
central banks.
The fund lost money in
both 2014 and 2015, including
a wrong-way bet on the euro
in December 2015, when the
European Central Bank un-
veiled a weaker stimulus pack-
age than many had expected.
Some commentators also have
pointed to the 2012 departure
of star trader Chris Rokos,
who made billions of dollars of
profits for the fund and who
BANKRATE.COM® MMA, Savings and CDs
Average Yields of Major Banks
Type
National average
Savings
Jumbos
Weekly change
Savings
Jumbos
Consumer Savings Rates
Explanation of ratings: Safe Sound SM, (855) 733-0700, evaluates the financial condition of fed-
erally insured institutions and assigns a rank of 1,2,3,4 or 5 based on data from the fourth quarter
of 2015 from federal regulators. 5: most desirable performance; NR: institution is too new to rate,
not an indication of financial strength or weakness. Information is believed to be reliable, but not
guaranteed.
High yield savings
Bank/rank
Phone number
Money market and savings account
Dime Community Bank /4 $1,000
(800) 321-3463
iGObanking.com /3 $25,000
(888) 432-5890
Pacific National Bank /4 $100
(305) 539-7500
One-month CD
VirtualBank /4 $10,000
(877) 998-2265
AloStar Bank of Commerce /4 $1,000
(877) 738-6391
Mount McKinley Bank /4 $5,000
(907) 452-1751
Two-month CD
VirtualBank /4
(877) 998-2265
Applied Bank /5
(800) 616-4605
Three-month CD
TAB Bank /4
(800) 837-4136
EverBank /3
(855) 228-6755
VirtualBank /4
(877) 998-2265
High yield jumbos - Minimum is $100,000
Money market and savings account
ableBanking,adivisionofNortheastBank/4
(877) 505-1933
California First National Bank /4
(800) 735-2465
EH National Bank /1
(888) 392-5265
One-month CD
USAA /5
(800) 583-8295
VirtualBank /4
(877) 998-2265
AloStar Bank of Commerce /4
(877) 738-6391
Two-month CD
VirtualBank /4
(877) 998-2265
Applied Bank /5
(800) 616-4605
Citizens Trust Bank /3
(404) 659-5959
Three-month CD
EverBank /3
(855) 228-6755
EH National Bank /1
(888) 392-5265
First Internet Bank of Indiana /4
(888) 873-3424
Notes: Accounts are federally insured up to $250,000 per person effective Oct. 3, 2008. Yields
are based on method of compounding and rate stated for the lowest required opening deposit to
earn interest. CD figures are for fixed rates only. MMA: Allows six (6) third-party transfers per
month, three (3) of which may be checks. Rates are subject to change.
Source: Bankrate.com, a publication of Bankrate, Inc., North Palm Beach, FL 33408
* *** THE WALL STREET JOURNAL.
BANKING & FINANCE
Deutsche Settles Probes
Bank will pay $629
million in New York
and U.K. investigations
tied to Russian trading
BY JENNY STRASBURG
PRENSA INTERNACIONAL/ZUMA PRESS
Deutsche Bank AG has
agreed to pay $629 million to
end investigations by U.K.
and New York regulators into
Russian equity trades that
transferred $10 billion out of
LEON NEAL/GETTY IMAGES
that country in violation of
anti-money-laundering laws.
The two fines—$425 mil-
lion to New York’s Depart-
Brevan’s Alan Howard ment of Financial Services
and $204 million to the U.K.’s
has since started his own Financial Conduct Author-
hedge fund, as a reason for ity—only partially resolve le- The settlements by Deutsche Bank don’t end a separate probe into the Russian trades by the U.S.
weaker returns. gal issues hanging over the
Brevan’s fund has roughly German lender. authorities in both countries costs ahead of its year-end of so-called mirror trades be-
halved in size in just two The U.K. regulator said lambasted what they de- earnings report, scheduled tween April 2012 and October
years, according to letters to Tuesday that the fine was the scribed as the bank’s lacka- for Thursday. Shares in the 2014 alone, the U.K. regulator
investors. largest that it or its prede- daisical oversight, particu- bank declined 1.2% Tuesday said. Customers of Deutsche
The latest outflows have cessor body had imposed for larly in light of past in Frankfurt trading. Bank’s Moscow office bought
come during a period of better failings in money-laundering misdeeds, including behavior The Russian trades in- highly liquid Russian securi-
performance for Brevan. prevention. tied to interest-rate rigging volved Deutsche Bank offices ties in rubles, while Deutsche
The fund gained almost 7% The settlement doesn’t end and sanctions violations. in Moscow, London and New Bank arranged for non-Rus-
in the final three months of a separate probe into the The lender agreed with York between 2011 and 2015. sian customers to sell the
2016 and finished the year Russian trades by the U.S. New York authorities to bring The bank notified regulators same securities in exchange
up 3%, helped by a spike in Justice Department. It is un- in an independent monitor of concerns about the trades for U.S. dollars.
bond yields and a rise in the clear when a settlement into for as long as two years. in early 2015. The U.K. authorities called
dollar. that investigation might be Earlier in January, In July 2015, Deutsche the transfers “highly sugges-
Some investors have hailed reached. Deutsche Bank completed a Bank named John Cryan as tive of financial crime.”
the election of President Don- Deutsche Bank said the separate agreement with the the replacement for then-co- The customers, who effec-
ald Trump as a boost for $629 million in settlements U.S. Justice Department to Chief Executive Anshu Jain. tively faced each other in the
hedge funds. Macro funds in announced Monday and Tues- pay $7.2 billion in cash and Within months, the bank shut trades, shared owners, ad-
particular have for years been day were materially covered consumer relief to end a se- down its domestic trading dresses or other links and
waiting for a pickup in bond by existing litigation reserves ries of mortgage-securities and investment-banking busi- were either unregulated or
yields and the dollar. and that the bank was coop- probes. The $3.1 billion cash ness in Russia. regulated in Russia, U.K. au-
However, the Trump trade erating with ongoing investi- portion was seen by analysts The U.K. and New York thorities said.
has reversed since the turn gations. and investors as a manage- regulators cited repeated The trades allowed cus-
of the year, leaving a number Regulators said Deutsche able outcome and ended shortcomings in Deutsche tomers to transfer billions of
of funds nursing losses. Bank had made significant speculation that the settle- Bank’s controls to detect sus- dollars out of Russia to banks
Brevan was down 1.3% in improvements to its anti- ment might force the bank to picious trades or determine in Cyprus, Estonia and Latvia,
January through Jan. 20, money-laundering program immediately raise capital. clients’ identities and sources U.K. authorities said.
said a person who had seen and other controls and had Investors remain focused of wealth. The lender exe- —Erica Orden
the numbers. cooperated with probes. But on the bank’s mounting legal cuted more than 2,400 pairs contributed to this article.
London-based Rubicon
Fund Management, headed by
former Salomon Brothers
trader Paul Brewer, made dou-
ble-digit-percentage gains fol-
lowing Mr. Trump’s election
TILTON the Zohar funds, distancing Pa-
triarch from the investment ve-
hicles she created.
After resigning, Ms. Tilton
victory but is down 5.1% this Continued from page B1 was no longer willing to fi-
month, according to numbers tative for Ms. Tilton and Patri- nance the companies, a repre-
sent to investors. A spokes- arch said the companies they sentative for Ms. Tilton and Pa-
man for Rubicon declined to manage are often in financial triarch said. The funds’ new
comment. distress. “Given the substantial managers, consulting firm Al-
obstacles that many of these varez & Marsal, failed to line
companies face, not all of them up new financing, the repre-
can be saved,” it said. sentative said.
The size of Ms. Tilton’s op- “As a result of this inaction,
Tuesday, January 31, 2017 eration isn’t clear. In 2015, Pa- several companies have been
MMA 1-MO 2-MO 3-MO 6-MO 1-YR 2-YR 2.5YR 5YR triarch counted 74 companies left with no alternative but to
in its portfolio, according to a cease operations,” said a repre-
0.10 0.07 0.07 0.11 0.16 0.27 0.43 0.43 0.82 news release. On the witness sentative for Ms. Tilton and Pa-
0.19 0.07 0.07 0.12 0.18 0.30 0.46 0.45 0.85
stand in a Delaware court in triarch.
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
August, Ms. Tilton said she be- Any money Ms. Tilton put
0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 -0.01 lieved there were about 50 Pa- into the companies wasn’t to
triarch-run businesses still in save them but to save herself
operation. In a television inter- from acknowledging how
view last week, she put the deeply troubled they were, said
number at more than 60. The Michael Carlinsky, a partner at
representative for Ms. Tilton Quinn Emanuel Urquhart &
and Patriarch declined to ex- Sullivan LLP who is represent-
GETTY IMAGES
plain the discrepancy or dis- ing the funds. “Ms. Tilton at-
cuss individual businesses. tempts to scapegoat others for
Yield Bank/rank Yield The SEC alleges that Ms. her own failure to navigate the
Minimum (%) Phone number Minimum (%) Tilton, a former banker who financial needs of the compa-
Six-month CD started Patriarch Partners 17 Lynn Tilton’s Patriarch Partners invests in distressed firms. nies she is responsible for
1.10 iGObanking.com /3 $1,000 1.10 years ago, hid losses in funds managing as senior executive
(888) 432-5890
1.10 TAB Bank /4 $1,000 0.95
she controlled that hold what vestors. Ms. Tilton has denied the and sole board member,” he
(800) 837-4136 are known as collateralized The SEC says Ms. Tilton civil-fraud charges and is said. The funds have sued Pa-
1.06 VirtualBank /4 $10,000 0.93 loan obligations. The funds, failed to disclose to investors awaiting a decision from an triarch, accusing the firm of si-
(877) 998-2265 known as the Zohars, raised that she claimed to have dis- SEC administrative law judge phoning $1 billion in cash and
One-year CD more than $2.5 billion from in- cretion in reporting loans as after a trial this past fall. The assets from the funds and the
0.15 EverBank /3 $5,000 1.38 vestors and used these invest- performing as long as she be- SEC seeks to bar her from the companies. Patriarch has said
(855) 228-6755
0.10 CIT Bank /NR $1,000 1.32
ments to make loans to trou- lieved the company had a securities industry as well as the suit is based on “vicious,
(855) 462-2652 bled companies controlled by chance to turn around. She reclaim $200 million in alleged spurious accusations” that
0.09 Pacific National Bank /4 $1,000 1.32 Patriarch. Cash collected on the says investors were aware of improper fees. Last year, she “will be exposed for the lies
(305) 539-7500 loans is used to repay fund in- the arrangement. resigned from management of that they are.”
Two-year CD
FINANCE WATCH
$10,000 0.15 EverBank /3 $5,000 1.55
(855) 228-6755
$1,000 0.05 Nationwide Bank /4 $500 1.51
(855) 255-1176
First Internet Bank of Indiana /4 $1,000 1.51
(888) 873-3424 MASTERCARD using their mobile phones at million, or $1.35 a share, from a
Five-year CD store checkout terminals. profit of $148 million, or 88
$1,000 0.85 EverBank /3 $5,000 2.28 Transactions Rise She added that Mastercard is cents a share, a year earlier. Ex-
(855) 228-6755
$5,000 0.85 State Farm Bank /4 $500 2.10 17%, Lifting Revenue accelerating its advertising and cluding restructuring and acqui-
(877) 734-2265 marketing spending into the first sition-related charges and other
$10,000 0.82 First Internet Bank of Indiana /4 $1,000 2.07 Mastercard Inc.’s fourth-quar- half to support Masterpass’s roll- items, per-share earnings rose
(888) 873-3424 ter profit rose from a year earlier out. This spending in the first to 95 cents.
on a jump in transactions as part quarter will be up by about $40 Revenue increased to 12% to
ANDREW HARRER/BLOOMBERG NEWS
of the card company’s push to million from a year earlier. $599 million. Analysts polled by
Six-month CD compete in digital payments, but Mastercard is expanding be- Thomson Reuters expected a
1.00 My e-BAnC by BAC Florida Bank /4 0.92 revenue growth slowed. yond traditional physical credit per-share profit of 94 cents on
(855) 512-0989
1.00 First Internet Bank of Indiana /4 0.90
Mastercard said transactions and debit cards as consumers revenue of $600.9 million.
(888) 873-3424 rose 17% as cross-border vol- move to digital formats. Shares of Nasdaq rose 3.5%
0.87 Colorado Federal Savings Bank /4 0.90 umes climbed 13%. Those factors For the fourth quarter, Master- to $70.54 Tuesday.
(877) 484-2372 helped revenue rise 9%, but the card reported a profit of $933 —Austen Hufford
One-year CD fourth quarter was the only one million, or 86 cents a share, up
0.22 EverBank /3 1.38 in 2016 in which revenue didn’t from $890 million, or 79 cents a HEDGE FUNDS
(855) 228-6755
climb by double-digit percent- share, a year earlier. Revenue Nasdaq site in New York
0.15 My e-BAnC by BAC Florida Bank /4
(855) 512-0989
1.30
ages. rose to $2.76 billion from $2.52 Soros Hires New
0.10 California First National Bank /4
(800) 735-2465
1.26 Mastercard’s stock fell 2.7% to billion. Analysts polled by Thom- initiatives under a new chief ex- Investment Chief
$106.33 Tuesday. Like its main ri- son Reuters expected 85 cents in ecutive led to write-downs.
Two-year CD val, Visa Inc., Mastercard charges per-share profit on $2.79 billion in This month, Adena Fried- Soros Fund Management
0.15 Nationwide Bank /4 1.56 fees to financial institutions for revenue. Mastercard said revenue man became Nasdaq’s chief ex- LLC has hired one of the most
(855) 255-1176
0.05 EverBank /3 1.55
transactions that travel over its was weighed down by more re- ecutive officer, making her the prominent women in the hedge-
(855) 228-6755 networks. bates and incentives mainly with first woman to lead a major fund industry as its new chief in-
0.01 First Internet Bank of Indiana /4 1.51 Operating expenses at the issuing banks, partly related to U.S. stock-exchange operator. vestment officer, according to
(888) 873-3424 company fell 1% from a year new and renewed agreements. It Former Chief Executive Bob someone close to the matter.
Five-year CD prior and were up 9% for the full also cited stronger dollar. Greifeld became chairman after Dawn Fitzpatrick was head of
0.85 EverBank /3 2.28 year versus 2015, while net reve- —Joshua Jamerson, almost 14 years at the helm. investments at UBS Asset Man-
(855) 228-6755
nue for 2016 rose 11%. AnnaMaria Andriotis On Tuesday, the company said agement, where she was global
0.82 State Farm Bank /4 2.10
(877) 734-2265 Mastercard finance chief Mar- it was evolving and rebranding head of equities, multiasset and
0.60 First Internet Bank of Indiana /4 2.07 tina Hund-Mejean said on an NASDAQ its fixed-income products, realign- the O’Connor hedge-fund busi-
(888) 873-3424 earnings call that expenses will ing some of its segments and ness. Ms. Fitzpatrick is the sev-
rise in 2017 as the company con- Restructuring Moves ending its NLX European inter- enth person to hold the job at
tinues to invest in areas such as Result in a Loss est-rate futures business to fo- Soros since April 2000, when in-
safety and security and its digi- cus on other goals. vestor Stanley Druckenmiller quit
tal-payment platform Master- Nasdaq Inc. posted a revenue For the quarter, the com- to run his own firm.
Internet: www.bankrate.com pass. That is geared for shoppers increase but swung to a loss as pany swung to a loss of $224 —Gregory Zuckerman
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com
THE WALL STREET JOURNAL.
As Yields Increase, Bonds
Regain Allure as a Hedge
Seeking insurance
against turbulence
could help set a floor
on prices of Treasurys
BY JON SINDREU
AND CHRISTOPHER WHITTALL
The recent bond selloff has
brought back one of the main
reasons for investors to hold
them: as an insurance policy.
Sovereign-bond yields
across the developed world
tumbled to all-time lows last
year as prices soared, dimin-
ishing their appeal to some in-
vestors. Now, with govern-
ment bonds offering higher
returns, some money manag-
ers are starting to buy Trea-
surys and other high-grade
debt again as a hedge against
market turbulence.
This nascent source of de-
mand could help set a floor on
prices for U.S. Treasurys—the
haven asset of choice for many
investors—following a rocky pe-
riod for the $13 trillion market,
as well as for German bunds.
The yield on the 10-year
Treasury note is up more than
a percentage point from last
July’s low but is little changed
over the past month.
Investors have paused in re-
cent weeks to gauge how much
President Donald Trump’s pol-
icies will boost economic
growth and inflation, increases
in which are broadly good for
stocks and bad for bonds. For
years now, investors have
liked bonds because their
prices kept rising, rather than
for their hedging properties.
But as yields rise again,
those old insurance seekers
may start to return.
They include Paul O’Connor,
who has started to rebuild po-
sitions in government bonds
in 2017 after several years of
largely avoiding using these
securities as “shock absorb-
ers” in the cross-asset portfo-
lios he runs. “We can now ex-
pect that government bonds
can offer some kind of insur-
ance feature again,” said Mr.
O’Connor, who heads multias-
set investments at Henderson
Dollar
Falls on
Weak Data
BY CHELSEY DULANEY
The U.S. dollar slid to its
lowest level since November
on Tuesday amid weak U.S.
data and new indications
that the Trump administra-
tion would prefer a weaker
dollar.
The Wall Street Journal
Dollar Index,
CURRENCIES which mea-
sures the
U.S. currency
against a basket of 16 others,
fell 0.7% to 90.48, its lowest
closing level since mid-No-
vember.
The dollar had rallied to a
14-year-high after President
Donald Trump’s election in
November. But the U.S. cur-
rency has lost steam since
the start of the year, falling
nearly 3% in January, as in-
vestors assess the impact of
Mr. Trump’s protectionist
trade and immigration poli-
cies.
Comments from key ad-
ministration officials indicat-
ing that the U.S. would pre-
fer a weaker currency also
buffeted the dollar.
Mr. Trump suggested
Tuesday that Japan and
China are devaluing their
currencies.
“Every other country lives
on devaluation,” Mr. Trump
said at a meeting with phar-
maceutical executives. “They
play the devaluation market
and we sit there like a bunch
of dummies.”
Separately, a U.S. trade
adviser told the Financial
Times that Germany is using
a “grossly undervalued” euro
to gain an advantage over
trading partners, including
the U.S. German Chancellor
Angela Merkel denied the
claims in a press conference.
A weaker currency helps
countries by making their ex-
ports more competitive
abroad.
* * * * Wednesday, February 1, 2017 | B15
MARKETS
Treasurys Heartened
By Signs of Weakness
BY MIN ZENG
U.S. government bonds
strengthened Tuesday as dis-
continue to generate fluctua-
tions in the bond market in
the near term, said Praveen
Korapaty, head of interest-
meaty returns, while high- appointing reports on busi- rate strategy at Credit Suisse.
grade debt would act as a buf- ness activity and consumer Selling Treasury bonds had
fer—rising in value when fears confidence stoked demand for been the popular trade for in-
were high and stock prices fell. haven assets. vestors to bet that the pros-
But investors became more The yield on the benchmark pect of large fiscal spending,
wary of relying on bonds as a 10-year Treasury note settled lower taxes and lighter regu-
safety valve in portfolios as at 2.451%, compared with lation would lead to stronger
yields plumbed new depths, 2.486% Monday. Yields fall as economic growth.
dragged down—even below bond prices rise. Demand for Treasury secu-
CHUCK MYERS/TNS/ZUMA PRESS
zero—by loose central-bank The Federal Reserve rities also had diminished as
policy in Europe and Japan. started its two-day policy investors expect the policies
At the peak in late Septem- meeting Tuesday and is to generate higher inflation,
ber, there was $13.34 trillion scheduled to release a policy potentially allowing the Fed to
of negative-yielding debt glob- statement Wednesday after- quicken its pace of interest-
ally, according to Bank of noon. The U.S. central bank is rate increases.
America Merrill Lynch. Inves- widely expected to stand pat The 10-year Treasury yield
tors didn’t have to pay to hold after raising short-term inter- reached a two-year high of
Treasurys, but yields became est rates in December for the 2.6% in mid-December from
Shifting Sands increasingly slender. The 10- second time since 2006. 1.867% on Election Day in No-
Some investors believe fixed income could retake its role as an year note hit a record-low vember. The yield has been
insurance policy against periods of market pessimism. yield of 1.366% in July. fluctuating largely between
Because equities also get a 2.3% and 2.6% over the past
Bond prices have slipped while U.S. stock indexes this year have
roared to fresh records...
Change in prices since 2014
15%
boost from loose monetary
policy, stocks and bonds actu-
ally started moving almost in
lockstep with each other.
111.8
Consumer-confidence index
weeks. The yield was only
marginally above 2.446%
traded at the end of 2016.
Hedge funds accumulated
Government debt became reading for this month $14.7 billion of net bets wa-
10 Stocks (S&P 500) not only a poor hedge in re- gering on lower prices for the
5 cent years, some investors say, 10-year Treasury futures for
but also an asymmetric bet. the week that ended Jan. 24,
0 Yields looked like they had lit- The Chicago Business Ba- according to TD Securities. On
–5 tle room to fall further—leav- rometer fell to 50.3 in January the other hand, asset manag-
ing investors vulnerable to a from 53.9 in December. In ad- ers held a net $10.2 billion in
–10
Bonds (10-year Treasurys) reversal in the market. dition, the U.S. Conference wagers on higher prices of the
–15 This is what happened in Board’s consumer-confidence 10-year Treasury futures dur-
2015 ’16 ’17 September: Money managers index declined to 111.8 in Jan- ing the same period.
started doubting that central uary from 113.3 in December. Tom Anderson, chief in-
...and fewer bonds are trading at negative yields, which imply banks would go much further, The data are “a bit of a vestment officer at Boston
a subzero return to a buyer at par. driving Treasury and German pushback against the optimism Private Wealth, said the pros-
Share of the $43 trillion global bond market yielding a return below zero bund yields to slowly ratchet that sent stocks soaring to re- pect of fiscal stimulus is likely
30% higher. The election of Mr. cords and Treasury yields to boost the economy and
Trump on Nov. 8 sparked a climbing” since the U.S. elec- push up bond yields, though
further selloff in bonds, joined tion, said Larry Milstein, head he doesn’t expect a swift rise.
20 by a rally in stocks across de- of government and agency
veloped nations. trading at R.W. Pressprich & Co.
Now, U.S. bonds and stocks Both U.S. stocks and the AUCTION RESULTS
Here are the results of Tuesday's Treasury auctions.
10 are moving in opposite direc- dollar fell Tuesday, the latest All bids are awarded at a single price at the market-
tions again, according to an signs that the reflation trade clearing yield. Rates are determined by the difference
between that price and the face value.
analysis of market correlations since the U.S. election is pull-
FOUR-WEEK BILLS
0 by The Wall Street Journal. In ing back. The Dow Jones In- Applications $155,418,623,500
’15 ’16 ’17 Europe, a smaller share of bonds dustrial Average has been Accepted bids $45,000,618,500
" noncompetitively $397,952,500
Sources: Thomson Reuters (prices), is offering negative returns. weakening after rising above " foreign noncompetitively $100,000,000
Bank of America Merrill Lynch (global bonds) THE WALL STREET JOURNAL. With bond yields higher, Ni- 20000 last week for the first Auction price (rate) 99.961889
(0.490%)
colò Carpaneda has been in- time. The dollar has been fall- Coupon equivalent 0.497%
Global Investors, which over- sen, chief economist at Indos- creasing holdings of short-term ing after reaching its highest Bids at clearing yield accepted 21.37%
Cusip number 912796JE0
sees roughly £100 billion ($125 uez Wealth Management. government bonds in Europe, since 2002 in early January.
The bills, dated Feb. 2, 2017, mature on March 2, 2017.
billion) world-wide. This could When yields rose in December, as well as U.S. corporate debt. Investors are weighing the
52-WEEK BILLS
limit any losses for sovereign Indosuez was one of the firms “Much of the Trump rally is prospect of expansive fiscal
Applications $69,608,405,400
bonds, which have moved that increased its exposure to already priced in; this way we stimulus and Mr. Trump’s pro- Accepted bids $20,000,281,400
sideways over the past month. sovereign debt. can protect ourselves against tectionism. His executive or- " noncompetitively $233,300,400
" foreign noncompetitively $0
If 10-year Treasury yields Traditionally, the classic as- any negative events,” said Mr. der suspending immigration Auction price (rate) 99.181000
go above 2.75% in the medium set-allocation structure was to Carpaneda, investment direc- from seven countries added to (0.810%)
Coupon equivalent 0.826%
term, from 2.451% on Tuesday, invest 60% of a portfolio in eq- tor of the retail fixed-interest the uncertainty. Bids at clearing yield accepted 42.20%
they will lure many more buy- uities and 40% in bonds. Equi- team at M&G Investments, a “There is still a lot of un- Cusip number 912796LJ6
ers, said Marie Owens Thom- ties were supposed to deliver £248 billion money manager. certainty,” which is likely to The bills, dated Feb. 2, 2017, mature on Feb. 1, 2018.
EQUITIES
Stocks Sound Retreat Amid Poor Earnings
BY AKANE OTANI AND RIVA GOLD
Retreat From Risk
Dow component Exxon
Mobil fell 97 cents, or 1.1%, to
The Dow Jones Industrial Shares of industrial companies 83.89, after the company re-
Average fell again, as earnings gave back some of their ported lower fourth-quarter
results hurt the shares of some postelection gains, while utilities earnings and said its 2016
big companies. rallied alongside other havens. profit came in at its lowest in
The stock-market rally that 20 years.
catapulted the Dow industrials 2% S&P 500 utilities sector United Parcel Service shed
over 20000 last week has 7.90, or 6.8%, to 109.13, after
stalled in recent sessions, with the company gave a downbeat
investors backing away from 1 outlook for its 2017 earnings
shares of financial and indus- and said lower margins in e-
trial companies and picking up S&P 500 commerce deliveries hurt its
0
havens such as gold. bottom line.
Some investors and analysts Industrial companies in the
JOHN SOMMERS II/REUTERS
said discord over President –1
S&P 500 fell 0.9% and were
Donald Trump’s move to re- among the worst performers
strict immigration has tem- in the broad index.
pered risk appetite at the end –2 S&P 500 industrials sector Under Armour fell 7.45, or
of an otherwise strong month 26%, to 21.49, after the ath-
for stocks. 9:30 10 11 noon 1 2 3 4 letic-gear maker posted an un-
The blue-chip index fell Source: FactSet expected fall in quarterly
107.04 points, or 0.5%, to UPS gave a downbeat outlook for 2017 earnings. Shares fell 6.8%. THE WALL STREET JOURNAL. profit and issued a disappoint-
19864.09, on Tuesday, ending ing sales forecast for 2017.
lower for a third consecutive month higher in what was their postelection gains in Jan- slipped 0.6% Tuesday, notching Havens gained. Utilities
session. The S&P 500 lost 2.03 their first January gains since uary. Dow component Gold- a 0.4% decline for January. companies were the best per-
points, or 0.1%, to 2278.87, 2013. man Sachs Group fell $4.58, “Everyone’s trying to figure formers in the S&P 500 on
while the Nasdaq Composite The Dow industrials added or 2%, to $229.32, on Tuesday, out if Trump is going to be Tuesday, rising 1.6%.
gained 1.07 points, or less than 0.5% for the month, the S&P 500 posting a 4.2% decline for the successful in reigniting the Early Wednesday, Japan’s
0.1%, to 5614.79. Major indexes rose 1.8% and the Nasdaq Com- month. economy,” said John Bartlett, Nikkei was flat, while Hong
posted their biggest declines posite climbed 4.3%, with all The KBW Nasdaq Bank In- portfolio manager at Reaves Kong’s Hang Seng Index was
of the year on Monday. three indexes posting their third dex of large U.S. commercial Asset Management. down 0.9%, South Korea’s Ko-
Despite this week’s set- consecutive month of advances. lenders, which rallied 22% Corporate earnings also spi was up 0.5% and Australia’s
backs, major indexes ended the Banks gave back some of from Election Day to year-end, tripped up stocks. S&P ASX 200 was up 0.3%.
AHEAD OF THE TAPE | Steven Russolillo
Facebook’s Steep Wager on Online Video Has to Pay Off
First it was people’s news feeds with too have increased 46% from the this week that Facebook is gest risks facing the stock
desktop. Then many ads. prior year. developing an app for televi- price. Some content owners
it was mobile. Now it is betting on video, Facebook acknowledges sion set-top boxes, which have resisted making deals
Next up on with the aim of swiping tele- that heady growth won’t last would include Apple Inc.’s due to concerns about adver-
Facebook vision ad dollars to keep up forever. It has warned that it Apple TV. tising arrangements.
Inc.’s quest growth. will stop showing users more With that in mind, the The highflying stock has
for world domination: video. With Facebook due to re- ads in their news feed, which company already is making had more tempered moves of
Strong advertising lease fourth-quarter earn- it says will prompt advertis- adjustments to attract ad late. Shares rose 10% last
growth, with a vast majority ings on Wednesday, inves- ing growth to “come down money from TV advertisers. year, the smallest calendar-
of it driven by mobile, has tors should watch this space. meaningfully” later this year. In an update published last year gain in Facebook’s short
propelled the social network Any stumble won’t be well That puts the onus on its week, Facebook said it would history as a public company.
to become the sixth-biggest received, particularly with video endeavors, including tweak its news feed to favor Fetching 24 times projected
U.S. corporation by market shares nearly priced for per- Facebook Live. Chief Execu- longer videos and, in partic- earnings over the next 12
value. fection. tive Mark Zuckerberg has ular, videos that people are months, Facebook is pricier
But even Facebook ac- Analysts polled by FactSet said he envisions the social watching closer to the end. than rivals Microsoft Corp.,
knowledges that it won’t be estimate earnings of $1.31 a network morphing into a Uncertainty about Alphabet Inc. and Apple.
able to maintain its current share, up 65% from a year “video-first” company. The whether they can attract There is still a lot to like,
trajectory without clogging ago. Revenue is expected to Wall Street Journal reported those ads is one of the big- but not at this price.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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B16 | Wednesday, February 1, 2017
Bullish Oil Bets Climb to Record
Optimism abounds
that OPEC production
curbs will firm prices,
but risks are growing
BY ALISON SIDER
AND TIMOTHY PUKO
Bullish bets on oil rose to a
record in January, reflecting
widespread optimism that
crude prices are poised to
move higher as OPEC starts
cutting production in a bid to
ease a global supply glut.
Wagers on rising U.S. oil
prices have more than doubled
in less than three months. In-
vestors have turned more bull-
ish since the Organization of
the Petroleum Exporting
Countries in late November
reached a deal to cut output.
Long, or bullish, positions
last week exceeded short, or
bearish, positions by 370,939,
marking the largest net bullish
position in 10 years of data
from the Commodity Futures
Trading Commission. That
compares with a net bullish
position of 159,415 contracts in
early November.
To put the size of the bull-
ish position in context: The
more than 420,000 bets on
rising oil prices in place last
week represented nearly all of
the crude held in U.S. commer-
cial storage tanks.
That is a sign of faith that
the nearly yearlong oil rally
has more room to run. But the
bullish slant to the market is a
concern for traders, who
worry that a dimming of the
market’s view on oil could
prompt a rush for the exits
and intensify any selloff.
The last time speculative
investors were this bullish on
oil was in June 2014—when Is-
lamic State militants began
threatening major cities in
Iraq. That was a few weeks be-
fore the market began a 20-
month-long slide. The historic
selloff sent oil from above
$100 a barrel to a decade low
Email: heard@wsj.com
Pharma’s Woe Is Far From Over
A high-profile meeting
Tuesday with a president
who accused the drug indus-
try of getting away with
murder could have ended
badly for the big pharma
companies.
Though he said drug price
increases have been “astro-
nomical” and vowed to
toughen Medicare negotia-
tion practices, President
Donald Trump pledged to
speed up regulatory approv-
als for new drugs and make
the process less expensive, a
positive for the pharma in-
dustry, especially smaller
biotechs.
Drug stocks traded
sharply higher Tuesday,
while most of the stock mar-
ket sold off. That was prema-
ture; it will take months to
sort out whether it is truly
business as usual for the be-
leaguered sector. But more
uncertainty from industry
earnings ought to postpone
any sense of relief.
Drug distributor Ameri-
sourceBergen on Tuesday
said on its fiscal first-quar-
ter earnings call that the
company is planning for
branded drug-price inflation
A Reckoning for Under Armour as Winning Streak Ends
Under Armour has long
promised a lot and then de-
livered. On Tuesday, it didn’t
come through, and now in-
vestors need to understand
the costs of that impressive
winning streak.
The sportswear maker’s
26-quarter string of 20%-
plus sales growth came to an
abrupt halt when it said
fourth-quarter sales rose
only 12%.
Under Armour also low-
ered its 2017 revenue-growth
outlook to between 11% and
12% from the low-20% range
and said operating income
would fall.
That wasn’t the fast-grow-
ing company investors have
Long Game
Bets on higher U.S. oil prices have climbed to record highs...
Speculative net position in U.S. crude
400,000 contracts of 1,000 barrels of oil on the New York Mercantile Exchange
300,000
200,000
100,000
0 tile Exchange. A weaker dollar
2013
...as investors anticipate that OPEC production
cuts will bring supply and demand into balance...
98 million barrels a day
96
94
92
90
2013 ’14
Sources: CFTC (contracts); WSJ Markets Data Group (price); International Energy Agency (production)
around $26.
Investors continue to pile
into long positions even
though the oil rally has been
on pause in the past seven
weeks. Oil volatility has plum-
meted to a two-year low. U.S.
prices stayed within a roughly
$3 range throughout January
as traders awaited confirma-
tion that promised cutbacks
from members of OPEC would
materialize.
Data on OPEC’s compliance
recently have started to trickle
in. The cartel is on track to
meet 75% of its promised cuts,
according to tanker tracker
Petro-Logistics. Other firms
have put the rate even higher.
HEARD ON THE STREET
Discounting
Eli Lilly's annual Humalog sales
$3.0 billion
2.5
2.0
1.5
1.0
0.5
0 distributors and pharmacy-
2010 ’11 ’12 ’13 ’14 ’15 ’16
Source: FactSet
THE WALL STREET JOURNAL.
of 7% to 9% this year.
AmerisourceBergen also said
that it expects companies to
raise prices again this sum-
mer, which would be a re-
turn to normal practice for
the sector.
However, finance chief
Tim Guttman also noted that
there is more uncertainty
about whether drug compa-
nies will follow similar pric-
ing strategies of years past.
That is one reason the com-
pany’s full-year adjusted
profit forecast of $5.72 to
fallen in love with. Class A
shares of Under Armour fell
sharply.
Under Armour’s fall was
partly a result of its lofty
multiple. Its shares traded at
44 times 2017 earnings esti-
mates as of Monday’s close.
Investors had already sent
its shares down 24% since
the company reported third-
quarter results on Oct. 25. At
that point, management ac-
knowledged that growth in
apparel would be slower
than growth in footwear,
pressuring gross margin.
Tuesday’s results revealed
a deeper problem with the
health of Under Armour’s
sales and its need to keep
MARKETS
’14
Global oil production
Global oil demand
’15 ’16
Those levels are well above
the producing group’s typical
compliance with quotas, ana-
lysts say, which helps explain
why so many investors are
bullish.
Oil prices rose 18 cents to
$52.81 a barrel Tuesday after
data on OPEC production lent
further support to the belief
that the group was abiding by
its pledge to cut output.
Will Riley, a portfolio man-
ager with Guinness Atkinson
Asset Management, said he ex-
pects crude prices to rise be-
cause he thinks OPEC mem-
bers are likely to keep
complying.
“I don’t think they are sat-
FINANCIAL ANALYSIS & COMMENTARY
Boxes of Eli Lilly’s
Humalog medication
$5.92 a share is wider than
normal, Mr. Guttman said.
Eli Lilly’s fourth quarter
results, also out Tuesday,
present a case in point: The
drug manufacturer has faced
sharp criticism from Sen.
Bernie Sanders, along with
rival drugmakers Sanofi and
Novo Nordisk, for the sharp
rises in insulin list prices.
The Wall Street Journal re-
ported in October that the
list price for Humalog, Lilly’s
best-selling drug, had more
than doubled since 2011.
spending in order to grow.
The company’s gross mar-
gins were 44.8%, down from
48% a year earlier.
On a conference call with
analysts, Under Armour said
it couldn’t reduce its ex-
penses enough in the near
term to match its lower reve-
nue expectations. It also said
that maintaining investments
in footwear, its international
business and e-commerce
was essential to its plan to
grow to a $10 billion brand
from $4.8 billion in 2016.
The gross margin pressure
shouldn’t have been news to
investors paying close atten-
tion. Under Armour’s gross
margins have been falling
’15
...helping lift crude prices out of their narrow range.
U.S. crude oil price
$60 a barrel
50
40
30
20
2016
isfied with the current [oil-
price] level,” Mr. Riley said.
OPEC’s agreement runs
through June. The prospect of
an extension of the curbs in
May is another reason inves-
tors are reluctant to bet on
lower prices, said Nick Kout-
softas, a portfolio manager
with Cohen & Steers. Mr.
Koutsoftas has placed bullish
bets on oil in recent weeks.
If OPEC prolongs output
cuts, that could cause stock-
piles to decline and send oil
toward $65 by year-end, he
said.
But some traders say the
lopsided market raises the
likelihood of a sharp reversal.
However, Lilly is hardly
living large as a result. The
drugmaker booked $2.8 bil-
lion in full-year Humalog
sales, down 3% from a year
earlier.
Lilly said volumes for the
drug grew amid a lower real-
ized net price. Humalog
sales have barely budged
since 2013, when Lilly
booked $2.6 billion in sales.
The drug companies are
implying that others in the
supply chain—mainly drug
benefit managers—are taking
their cut of rising drug
prices. Overall, price in-
creases in the U.S. boosted
Lilly revenue by just 1%. Data
released by Merck & Co. last
week indicate that the com-
pany’s net prices—which re-
flect what the company col-
lects in revenue—rose just
5.5% in 2016 even though list
prices rose 9.6% on average.
While health-care compa-
nies are pointing fingers at
each other, they risk getting
slammed all together by Mr.
Trump’s effort to cut costs.
Investors should be prepared
for another bumpy year.
—Charley Grant
Tuesday’s results
revealed a deeper
problem with Under
Armour’s sales.
since the first quarter of
2015, and the company’s
days of sales outstanding—a
measure of the average num-
ber of days it take a com-
pany to get paid after a
sale—began to climb in the
third quarter of 2015, ac-
cording to Instinet analyst
Simeon Siegel.
Under Armour’s manage-
* * THE WALL STREET JOURNAL.
Jan. 24
370,939
’16 ’17
Tuesday
$52.81
’17
THE WALL STREET JOURNAL.
Cascading sell orders could
quickly sink prices, they say.
“It’s going to be harder and
harder to get the market
higher when the market is al-
ready so long,” said Kathleen
Kelley, chief executive of
Queen Anne’s Gate Capital
Management, a commodities
consulting firm. “The market
is really vulnerable here.”
There is an expectation that
OPEC will continue to abide by
its agreement, said John Pick-
art, a commodity-fund man-
ager with Franklin Templeton
Investments. “But if there’s
any whiff of it not happening,
there’s a lot of positions there
that can get unwound.”
OVERHEARD
Little did they know, but
customers who uttered the
phrase “there’s a Big Mac for
that” during specific hours at
certain McDonald’s restau-
rants could have made a
sweet profit. Winners
snagged one of 10,000 free
bottles of the special sauce
made famous by the old jin-
gle about the world’s most fa-
mous hamburger.
The sauce is selling for be-
tween $60 and $70 on
eBay—enough for a devotee
to trade them in for upwards
of 15 servings of the sauce
along with two all-beef pat-
ties, lettuce, cheese, pickles,
onions and a sesame seed
bun.
Unlike the secret formulas
such as the KFC colonel’s 11
herbs and spices or Coca-
Cola’s secret recipe, the spe-
cial sauce isn’t exactly
shrouded in mystery. Those
without access to high fruc-
tose corn syrup, xanthan gum,
EDTA or propylene glycol can
whip up a close approxima-
tion of it with mayonnaise,
pickle relish and Thousand Is-
land dressing and have at
least $57 in change left over.
ment is right when it says
the only way to $10 billion in
sales is to continue to invest.
But that scale may not help
Under Armour get much le-
verage over its costs, Mr.
Siegel argues.This is because
athletic brands are domi-
nated by variable costs such
as sponsorship and market-
ing. That means these com-
panies must continue to
spend in order to grow, and
Nike’s superior marketing
budget gives it a built-in ad-
vantage.
Under Armour pulled off a
stunning winning streak, the
question for investors is, at
what cost.
—Miriam Gottfried
Price of
Gold Rises
On Data,
Politics
BY IRA IOSEBASHVILI
AND KATHERINE DUNN
Gold prices rose Tuesday,
boosted by weaker U.S. eco-
nomic data and political un-
certainty.
Gold for April delivery
closed up 1.3% at $1,211.40 a
troy ounce on the Comex divi-
sion of the New York Mercan-
and heightened political tur-
bulence in the U.S. have lifted
gold prices by 4.9% this
month, their best percentage
gain since
COMMODITIES June.
The Chi-
cago Pur-
chasing Managers Index, a
gauge of manufacturing activ-
ity, fell to 50.3 in January
from a reading of 53.9 a
month before.
The data helped push the
dollar lower, providing a boost
to gold, which is priced in the
U.S. currency and more afford-
able to foreign buyers when
the dollar falls.
“It’s a pretty big miss and
sparked a flight to safety,”
said Bob Haberkorn, a broker
at RJO Futures.
The Wall Street Journal
Dollar Index fell 0.7% to 90.48.
With the Federal Reserve
scheduled to conclude its
monetary policy meeting
Wednesday, traders have been
keeping an especially close
eye on U.S. economic data. A
more hawkish view on mone-
tary policy from the central
bank would be detrimental for
gold, as the metal struggles to
compete with yield-bearing in-
vestments when interest rates
rise.
Silver for March delivery
was up 2.3% at $17.54 a troy
ounce. April platinum rose
0.3% at $996.50 a troy ounce.
WSJ.com/Heard
Apple Ready
For Its Next
‘Supercycle’
For those wondering what
exactly an iPhone “supercy-
cle” looks like, take heed
that the meaning changes
with time.
Bullish analysts coined the
term in 2012, as Apple Inc.
was preparing to launch the
iPhone 5. The idea was recy-
cled ahead of the iPhone 6 in
2014, and has again been
making the rounds leading
up to Apple’s fiscal first-
quarter results, posted Tues-
day afternoon.
The concept is the same—
that the best time to own
Apple’s shares is ahead of a
major upgrade, such as the
one expected later this year
for the iPhone’s 10th anni-
versary.
But Apple sells more than
200 million iPhones a year
now, so the law of large
numbers is no longer theo-
retical. Analysts see the next
supercycle equating to Apple
growing iPhone’s annual
sales by 18 million units in
fiscal 2018—for growth of
about 8%.
The logic is that a large
base of iPhone users will be
hungry for an upgrade. Ap-
ple reported Tuesday that
iPhone unit sales for the De-
cember quarter rose 5% year
over year.
That beat estimates, and
gave the stock a lift after
hours.
Apple’s stock has jumped
more than 30% since bot-
toming last year, but it still
trades just above 10 times
forward earnings, excluding
net cash. That is a price that
can be justified even by a
less-super cycle, assuming
Apple keeps its crucial gross
margins in line. To go be-
yond a modest bounce, the
world’s largest company will
need to pull something
new—and big—from its
sleeve.
—Dan Gallagher