After a successful career in the NBA, playing for the Golden State Warriors, LA Lakers, and the Dallas Mavericks, Troy Murphy is on to his next venture -- helping people that come into sudden wealth manage their money with his company Sweven Wealth.
After a successful career in the NBA, playing for the Golden State Warriors, LA Lakers, and the Dallas Mavericks, Troy Murphy is on to his next venture -- helping people that come into sudden wealth manage their money with his company Sweven Wealth.
Investors have been diversifying out of bitcoin and into altcoin investment products, according to CoinShares.
Stock indexes were lower globally on Monday with technology shares on Wall Street falling, while U.S. Treasury yields traded little changed even after a report showing the highest prices ever paid in a May manufacturing survey for New York State. The S&P 500 technology sector was down 0.9% and was the biggest drag on the benchmark index. Concerns over inflationary pressure helped to lift gold prices to their highest in more than three months, however.
The Paxos Settlement Service uses blockchain technology to speed up the process of completing transactions.
(Bloomberg) -- Sign up for the New Economy Daily newsletter, follow us @economics and subscribe to our podcast.China’s recovery remained unbalanced in April, with industrial output and investment buoyed by strong exports and a hot property market, while retail sales missed forecasts.Industrial output rose 9.8% in April from a year earlier versus the median estimate for a 10% increase. Retail sales expanded 17.7% in the period, far slower than a projected 25% rise. Fixed-asset investment grew 19.9% in the first four months of the year, in line with forecasts. The unemployment rate was lower at 5.1%.The data underline that while China remains a global growth driver and source of demand for commodities, the economy’s expansion may have plateaued as policy makers seek to rein in real estate and scale back infrastructure stimulus before new growth drivers of consumer spending and manufacturing investment have recovered.“Economic growth likely peaked in the first quarter” on a quarter-on-quarter basis, said Zhiwei Zhang, chief economist of Pinpoint Asset Management. “We expect growth to gradually slow in the coming months.” Monetary policy tightening is probably on hold for now, he said, with small Covid outbreaks in China in recent days adding to policy maker’s caution.The data was heavily impacted by base effects from April 2020 when China’s industrial economy reopened after the coronavirus was brought under control. On a two-year average basis, which corrects for that distortion, industrial production growth was constant from the first quarter at 6.8%, while fixed-asset investment accelerated slightly to 3.9% from 2.9%.However, retail sales growth softened to 4.3% in April on an average two-year basis from 6.3% in March, with the consumption of goods and catering services both turning weaker, denting expectations that consumer demand was beginning to replace investment as a driver of growth.Households in China have yet to “resume their usual swagger” due to weak income growth, said Frederic Neumann, head of Asian economics at HSBC Holdings Plc. “If households fail to step up their spending in the coming months, the authorities may be forced to loosen the reins on liquidity and investment spending to prevent a sharper deceleration in growth,” he added.Read More: Some Theories on What’s Holding Back China’s ConsumerBeijing has pledged a gradual scaling back of the monetary and fiscal stimulus pumped into the economy last year, with no sharp turn in policy. Recent data shows a notable slowdown in credit in April, suggesting the exit might be materializing at a faster-than-expected pace. The central bank injected medium-term cash into the financial system Monday to match the amount falling due, a move largely expected by analysts.China’s stock benchmark CSI 300 Index extended gains to as much as 1.9%, with the data taming fears over tightening liquidity.Iris Pang, chief economist for Greater China at ING Bank NV, said weaker retail sales data last month, driven by home appliances, cosmetics and jewelery, reflected seasonal factors -- such as consumers saving ahead of discounts offered by retailers during a national holiday in early May. A fall in the unemployment rate to 5.1% in April from 5.3% in March suggests a tighter labor market could continue to boost consumer spending.While China’s economy has stabilized, its still challenged by an uneven pandemic recovery globally as well as a fragile basis for recovery at home, the National Bureau of Statistics said in a statement. A separate report from the NBS suggests the property market remains strong, with home prices rising at the fastest pace in eight months in April.The nation’s top leaders recently described the recovery as “unbalanced and unstable,” pledging further efforts to drive a rebound in domestic demand. Sheng Laiyun, a vice head of the NBS, said earlier this month there’s still a gap between actual and potential growth, suggesting the recovery has still some way to go.What Bloomberg Economics Says...The recovery is expected to continue at least into 3Q, but domestic weakness remains a drag on the overall economy. External demand should remain a support, with rival exporters facing disruptions from virus resurgences. Domestically, China’s recovery is broadening, with demand and small private firms on the mend. Even so, the recovery in consumption is still not on solid ground, and remains vulnerable to another setback caused by sporadic virus outbreaks.Chang Shu, chief Asia economistFor the full report, click here.Industrial production remained robust on the back of a recovery in global demand, with fiscal stimulus and faster vaccine rollouts in developed economies helping to keep export growth strong. China’s steel and aluminum output in April blasted through previous records as Beijing’s efforts to rein in production and emissions foundered in the face of surging prices.Despite a surge in exports and industrial profits, manufacturing investment remained weak in the first four months of the year, dropping 0.4% on a two-year average basis in April, suggesting that firms lack confidence about the future strength of the rebound.Nomura Holdings Inc. sees a number of risks building in the second half of the year: export growth may slow as consumers in developed economies shift spending from goods to services; a resurgence in virus cases in developing nations could cut demand from those countries; surging raw material prices will weigh on spending; and curbs on property and local governments debt will impact investment.(Updates with comments from economists.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
The air is leaking out of the crypto complex, led by sharp declines in popular trades, including bitcoin, dogecoin and crypto platform Coinbase Global on Monday.
The crypto car drove to the dump Monday as most blockchain assets fell.
The payments will reach more than 65 million children, according to senior administration officials.
Dividend stocks are always popular. They offer investors a clear path to returns, with regular cash payments and a yield – a return on the original investment – that usually far exceeds bond yields. But not all dividend stocks are created equal, and some offer better opportunities than others. Dividend yield is a key metric. Among S&P listed companies the average yield is only 2%. However, the highest yields aren’t always the way to go. Investors should also consider share appreciation or upside potential – these factors aren’t always connected to dividends, but they will affect the general returns available from a given stock. To that end, we’ve used the TipRanks database to pull up two high-yield dividend stocks that share a profile: a Buy-rating from the Street’s analyst corps; considerable upside potential; and a dividend yielding over 8%. Let’s take a closer look. New York Mortgage Trust (NYMT) We’ll start with a real estate investment trust (REIT), a logical place to turn for high dividend returns. REITs typically pay out higher than average dividends, as a way of complying with profit-return regulations in the tax code. New York Mortgage Trust, which holds a portfolio of adjustable-rate residential mortgage loans, commercial mortgages, and non-agency mortgage-backed securities, is typical of its niche, both in the quality of its portfolio and its high yield dividend. In its recent 1Q21 financial release, NYMT listed several metrics of interest to investors. The company sold off non-agency RMBS and CMBS totaling $111.6 million, purchased $347.3 million in residential loans, and finished the quarter with $4.72 billion in total assets. The company saw net investment income of $30.3 million, and was able to fund its dividend payment, to the tune of 10 cents per common share. At that payment rate, the dividend yields 8.91%. This was the second dividend declaration in a row at 10 cents; the company has been gradually increasing the payment since cutting it back last summer during the worst of the corona crisis. B. Riley analyst Matt Howlett was impressed by NYMT’s management of the recent economic crisis, and that factor takes a lead role in his recent initiation report. “Over the last decade, NYMT has delivered among the highest economic return within the space due in part to strong asset selection, low leverage, and a highly efficient operating structure. While the March 2020 liquidity crisis was a setback for the industry, NYMT managed the crisis admirably, in our view, and avoided any major wear and tear on the company. In fact, we argue that as NYMT has rebuilt, its originations have become more direct (acquiring loans vs. securities), and its cost of capital has been declining,” Howlett opined. In line with these comments, Howlett rates the stock a Buy, and his $6 price target implies a one-year upside potential of 36%. Based on the current dividend yield and the expected price appreciation, the stock has ~45% potential total return profile. (To watch Howlett’s track record, click here) Overall, there are four recent reviews on record for NYMT, and they break down to 2 Buys, 1 Hold, and 1 Sell for a Moderate Buy consensus rating. The shares are selling for $4.45, and the average price target of $5.17 suggests room for ~17% upside from that level. (See NYMT stock analysis on TipRanks) Global Net Lease (GNL) Next up, Global Net Lease, is another REIT. The portfolio here is built on commercial real estate properties. A review of the company’s portfolio shows 306 such properties, totaling 37.2 million square feet of leasable space, let to 130 tenants. GNL operates in 10 countries, and boasts that 99.7% of its total square footage has been leased. The average lease has 8.3 years remaining – an important factor, as the long term provides stability to the portfolio. In the first quarter of 2021, GNL showed a top line of $89.4 million, up 12.8% from the year-ago quarter. The company ran a net loss, but at $800,000 that loss was significantly smaller than the $5 million lost in 1Q20. Net operating income was up from $71.9 million one year ago to $81.8 million in 1Q21. GNL reported sound liquidity in the quarter, with $262.9 million in cash or cash equivalents and an additional $88.6 million available in credit. And most importantly, GNL reported collecting 100% of rents due in Q1. GNL declared a 40 cent dividend for common shareholders during the quarter, and through it distributed a total of $36.2 million. At that rate, the dividend annualizes to $1.60 and gives a high yield of 8.59%. The dividend was cut last year during the corona crisis, but has been kept stable for five quarters since then. All of this adds up to a company that is sound on fundamentals of its business, and that has attracted notice from analyst Bryan Maher. In his note for B. Riley, Maher writes, “GNL's strong portfolio metrics provide for an attractive setup for the balance of 2021…. Given that GNL, in our view, is not over-levered and can borrow at exceedingly low rates, combined with prudent use of its in-place ATM, we are not concerned about the REIT's ability to finance acquisitions to hit our $300.0M target for 2021.” The analyst summed up, "Given GNL's well-crafted industrial/ office net lease portfolio and strong operating metrics, we reiterate our Buy rating on the shares." The Buy rating comes with a $23 price target attached. At current share price, that implies an upside of ~25% for the next 12 months. (To watch Maher’s track record, click here) Some stocks fly under the radar, and GNL is one of those. Maher's is the only recent analyst review of this company. (See GNL stock analysis on TipRanks) To find good ideas for dividend stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights. Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
AT&T ruined a lot of shareholder value by trying to get success in the media business, a veteran media analyst Craig Moffett tells Yahoo Finance Live.
(Bloomberg) -- JD Logistics Inc., the delivery arm of e-commerce giant JD.com Inc., is seeking to raise as much as HK$26.4 billion ($3.4 billion) in its Hong Kong initial public offering, seizing on China’s online shopping boom sparked by the coronavirus pandemic.The warehousing and shipping company is selling 609.2 million shares at HK$39.36 to HK$43.36 each, according to a statement published in the South China Morning Post. The company will start taking investor orders from Monday and is set to begin trading on May 28 in Hong Kong. The deal is expected to be priced on May 21, according to the terms of the IPO obtained by Bloomberg News.At $3.4 billion, JD Logistics would be the second-largest IPO in the city this year, after Kuaishou Technology’s $6.2 billion listing in February. Hong Kong has seen two other blockbuster JD.com-related offerings in the past 12 months, including online health-care unit JD Health International Inc.’s $4 billion IPO in December, as well as its own second listing in June, which raised $4.6 billion.JD Logistics’ first-time share sale comes as Hong Kong’s market shrugs off concerns over inflation. The city has hosted $20.5 billion worth of IPOs so far this year, nearly seven times the $3 billion raised in the same period in 2020, data compiled by Bloomberg show.Created in 2007 and set up as a standalone unit under JD.com a decade later, JD Logistics’ networks include both so-called last mile and longer distance lines, as well as cold chain and bulky item networks, according to its prospectus. It operated more than 900 warehouses across China as of the end of 2020.The logistics firm’s revenue climbed 47% in 2020 to 73.4 billion yuan, the prospectus shows. The company reported a net loss of 4.1 billion yuan last year, compared to 2.2 billion yuan in 2019. It plans to use the proceeds from the IPO to upgrade and expand its logistics networks, develop advanced technologies and to expand its customer base.JD Logistics has attracted seven cornerstone investors to its offering, who agreed to subscribe for about $1.53 billion of stock, according to the terms.The cornerstone investors are:SoftBank Vision Fund $600 millionTemasek Holdings Pte about $220 millionBlackstone Group Inc. $150 millionTiger Global $200 millionChina Chengtong Holdings Group Ltd. $160 millionMatthews Asia $100 millionOaktree Capital $100 millionBofA Securities Inc., Goldman Sachs Group Inc. and Haitong International Securities Group Ltd. are joint sponsors for the listing.(Updates with details of cornerstone investors from term sheet.)For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
Berkshire Hathaway took a stake of more than $900 million in insurance broker (AON) and sold off nearly all of its longtime investment in (WFC) (WFC) in the first quarter. Berkshire’s quarterly 13-F filing released late Monday showed a new position of about 4.1 million shares in Aon (ticker: AON). Berkshire (BRK.A, BRK.B) has been steadily selling its stake in Wells Fargo since early 2020.
Consequently, data retrieved from Glassnode affirmed the Bitcoin supply held by long term holders has returned to accumulation mode, even as price dips.
‘When same-sex marriage became a possibility in New York, he declined to consider it because he did not want to take on any possible financial obligations that a future divorce might entail.’
The stock markets can sometimes be a study in paradoxes. Good and bad news will exist simultaneously, tugging in various directions, and short-term trends can shift in a single trading session. Start with two data points noted by Oppenheimer’s chief investment strategist John Stoltzfus. He draws attention to the Q1 earnings – reporting season is winding down – particularly to the strong results. After 91% of the S&P 500-listed companies had reported, quarterly revenues had grown 9.8% year-over-year and earnings were up 47%. On the negative side, Stoltzfus contrasted the solid earnings with the poor April jobs report. The new jobs total reached a mere 266,000; far short of the nearly 1 million expected, and the February/March numbers were revised downwards. Stoltzfus sees resilience in the markets, however, as stocks continue to hover near record levels. "So far in 2021 the US economy and stocks have shown remarkable resilience considering the challenges and uncertainties they face in the process of moving towards the 'next new normal.' It’s no secret that a whole lot of love in the form of accommodative monetary policy from the Fed and gargantuan levels of stimulus from Capitol Hill have played a significant role to effect the process of navigating a landscape fraught with the uncertainties that come with any recovery from a major crisis," Stoltzfus wrote. The upshot: Oppenheimer comes down in favor of stock investing in today’s overall market environment, with an emphasis on US equities. The investment firm has been consistent in this stance for some time now, and its stock analysts have been making their recommendations accordingly. Two of those recent stock recommendations caught our eye; according to the TipRanks database, these are stocks that gotten under the radar of the analyst class. They haven’t had much coverage, but Oppenheimer’s analysts believe that each could double or more in the next year. Let’s find out why. Cyclacel Pharmaceuticals (CYCC) The first stock we’re looking at, Cyclacel Pharma, is involved in clinical-stage research into new cancer medications. The company’s focus is on innovative drug candidates based on ‘cell cycle, transcriptional regulation, and mitosis biology;’ in plainer language, the way cells divide. Uncontrolled cell division is a hallmark of tumor growth, and Cyclacel aims to tackle that facet of cancer through several pathways. Cyclacel has two main drug candidates in its pipeline, fadraciclib and CYC140. Both are undergoing clinical trials as treatments for solid tumors and leukemia, but with different mechanisms. The first is a transcriptional regulator, while the second is in the anti-mitotic program. Fadraciclib is administered either orally or intravenously, and is an inhibitor or CDK2 and CDK9. It has been shown to cause death of cancer cells at sub-micromolar concentrations. The company plans to begin dosing patients with fadraciclib in Phase 1b/2 studies against solid tumors and leukemia by the end of this year. Data from the earlier Phase 1 study, against two forms of leukemia, will also be released later this year. CYC140 follows a different pathway, being a selective inhibitor of PLK1, a mitotic pathway enzyme. PLK1 has a central role in cell division, and its inhibition in tumor cells is a promising mode of treatment. Like fadraciclib above, CYC140 will be entering a Phase 1/2 study against solid tumor and leukemia, with patient dosing to begin this year. The drug candidate has already completed a Phase 1 study in patients with advanced leukemias, and data from that study will also be released in the coming months. Covering this stock for Oppenheimer, 5-star analyst Kevin DeGeeter lays out the upbeat prospects for the company. “We view CYCC as offering a unique opportunity to participate in POC data readouts from two targeted cancer therapies before the end of 2022. Our investment thesis is based on the following assumptions: 1) oral fadraciclib maintains an acceptable safety profile, including myelosuppression—a key challenge for first-generation pan-CDK inhibitors; and 2) CYC140 exhibits potential for single-agent activity. With successful POC data from one or more Phase II expansion cohorts, we expect CYCC to explore opportunities for partnering of commercial rights to markets outside the US,” DeGeeter opined. In line with his bullish comments, DeGeeter rates CYCC an Outperform (i.e. Buy) along with a $17 price target. The figure is set to reward investors with 12-month returns of ~140%, should DeGeeter's thesis play out accordingly. (To watch DeGeeter’s track record, click here) Micro-cap biopharmas don’t get a lot of analyst attention – they tend to fly under the radar. However, there are two reviews on file here and both are to Buy, making the consensus rating a Moderate Buy. CYCC shares are priced at $7.06, with an average price target of $17.50 indicating a runway toward ~148% upside for 2021. (See CYCC stock analysis on TipRanks) Chemomab Therapeutics (CMMB) Next up, Chemomab, is another biotech firm. This company is focused on the treatment of fibrosis-related diseases, especially of the liver. The company merged with the Israeli biotech firm Anchiano this past December, forming a combined entity that will pool resources to develop Chemomab’s drug candidate, CM-101. The merged company began using the CMMB ticker on the NASDAQ this past March. The pipeline drug, CM-101, is a monoclonal antibody, first in its class, targeting CCL24 and known to interfere with disease-causing fibrosis of the liver, skin, and lungs. Chemomab has three parallel programs, all Phase 2 clinical trials, to study CM-101 in the treatment of rare fibrotic diseases. These diseases include Primary Sclerosing Cholangitis (PSC), Systemic Sclerosis, and Liver Fibrosis MoA (NASH). The first is a chronic, progressive, cholestatic disease of the liver, without current treatment options. In preclinical studies, CM-101 was seen to inhibit the overexpression of CCL24 and to attenuate cholestasis and fibrosis in animal subjects. The company is currently enrolling patients in a Phase 2a clinical trial, SPRING, for the treatment of PSC. The trial is expected to enroll 45 patients by early 2022, and preliminary data is expected in the first half of next year. Systemic Sclerosis is a rare, chronic autoimmune disease of the skin, and is better known as scleroderma. The disease can involve numerous organs of the body, and is slowly progressive. CM-101’s anti-fibrotic action has been found efficacious in preclinical studies, and a Phase 2 clinical trial is planned to start later this year. Finally, NASH – non-alcoholic steatohepatitis, or non-alcoholic fatty liver – is another fibrotic illness without a currently approved treatment. The disease is the liver manifestation of an underlying metabolic disorder, and can lead to liver failure. The Phase 1b clinical trial indicated that CM-101 was well-tolerated and showed promise in treating this condition. A Phase 2a trial, SPLASH, is scheduled to enroll 40 patients by year’s end, and early data is expected in 1H22. Analyst Jeff Jones, in his coverage of this stock for Oppenheimer, notes the company's pipeline and the cash runway as significant factors. “Compelling results in several disease models point to CCL24 neutralization as a treatment strategy, and initial clinical safety is supportive. Phase 2 reveals in primary sclerosing cholangitis (PSC) and non-alcoholic steatohepatitis (NASH) are anticipated in 1H:22, and a trial in systemic sclerosis (SSc) is on track to commence later this year. We would expect success in any of these poorly-met fibrotic indications, each of which offers sizable sales potential for CM-101, to drive significant value for CMMB. Cash runway, post recent financing, is approximately two-plus years," Jones wrote. To this end, Jones gives CMMB shares an Outperform (i.e. Buy) rating along with a $42 price target. At the current share price of $16.63, that price target suggests an upside of ~153%. This stock appears to be flying under the Street’s radar and currently Jones' is the sole CMMB review. (See CMMB stock analysis on TipRanks) To find good ideas for biotech stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights. Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
Coinbase Global on Monday said it plans to sell $1.25 billion of convertible debt. Its stock closed below its $250 reference price for the first time since the crypto platform listed on the Nasdaq exchange in mid-April.
Cathie Wood's firm believes the concern about Bitcoin mining's impact on the environment is misguided.
AT&T said Monday it will combine its massive WarnerMedia media assets, which includes HBO and CNN, with Discovery Inc. to create a new media heavyweight in a $43 billion deal.
Delving deeper into the global oil and gas outlook suggests that it's peak oil supply, not peak oil demand, that's likely to start dominating headlines as the years roll on
With Tax Day finally arriving Monday, delayed from its usual date in April due to pandemic-related changes to the tax code, last-minute filers should prepare for what could be a long wait to get their refunds. Even before the tax filing deadline, the IRS had a backlog of more than 30 million returns that still needed processing, according to the Taxpayer Advocate Service. The flood of new returns on Monday is expected to make matters worse. “Taxpayers will continue to experience unusually long delays,” National Taxpayer Advocate Erin M. Collins told CBS MoneyWatch. “I don't think anyone wants to hear that, but that is the case.” The backlog is a mix of 2019 returns, the processing of which was severely delayed by the closure of many IRS offices last year, and 2020 returns that have been stacking up behind them. Changes in the tax system related to the pandemic, including new tax credits and the issuance of stimulus checks, are adding to the delays. Adjustments to stimulus payments require manual review by the IRS, a time-consuming process even in the best of circumstances. The IRS expects to receive about 160 million tax returns this year, with about 40 million of those arriving on or after the May 17 deadline. Like what you're reading? Sign up for our free newsletter.
(Bloomberg) -- It’s a Wall Street nightmare. You score hundreds of millions of dollars on a trade and you just can’t get paid.That’s what Goldman Sachs Group Inc. faces in a transaction pitting its traders against Mexico’s dominant power company, championed by none other than President Andres Manuel Lopez Obrador, according to people with knowledge of the matter. At issue: roughly $400 million the Wall Street bank believes it’s owed from a natural-gas trade that went wild when a deep freeze hit Texas in February.In private discussions with Goldman Sachs, state-owned utility Comision Federal de Electricidad has blamed rogue traders, ejected staff and even hinted that the side lacking financial sophistication in the trade was, perhaps, the Wall Street bank, the people said.If the impasse continues to escalate, it risks dragging the bank into a political blowup.The freakishly cold storm that battered the central U.S. set off sweeping blackouts as ice formed on wind turbines and some pipelines froze, forcing oil and gas wells to shut. As power suppliers and traders struggled to track down fuel to meet obligations, prices skyrocketed. The surge benefited companies that happened to be on the right side of trades, but their ability to collect depends on what happens to gas suppliers, power generators and utility customers, some of whom have filed price-gouging lawsuits.The cost of paying Goldman Sachs could ultimately come from Mexican households, many of whom were left without power in the winter -- not so much because of local malfunctions but because authorities in Texas cut off fuel exports when their own lightly regulated system failed. It’s little surprise then that officials south of the border are reluctant to write a check to a giant U.S. bank.Yet anybody who bails on such a bet risks becoming persona non grata on Wall Street, complicating their future access. On the other side, Goldman’s leaders have to consider how angry they want to make the government of Mexico, a market where the firm has been expanding.The descriptions of the dispute and the underlying transaction between Goldman and a CFE subsidiary were provided by people with knowledge of the matter, who asked not to be identified publicly discussing the talks. A representative for Goldman Sachs didn’t comment for this story.The bank and CFE are heading into arbitration over the matter, a spokeswoman for the utility told a Whatsapp chat room with journalists on Monday, noting “the CFE considers that it has solid and sufficient arguments.”On the face of it, it was a routine natural-gas contract. Goldman had entered into the arrangement with CFE International, an arm of CFE. The investment bank’s obligations were tied to a monthly index of gas prices, while the CFE unit would be exposed to daily rates at certain hubs, such as the Waha hub in West Texas.The daily price there surged by nearly 100 times, whereas the monthly price was left largely unchanged, leaving the CFE subsidiary on the hook for an unusually large amount. But instead of the contract getting settled in the Wall Street firm’s favor, the situation has devolved into an acrimonious spat.The Mexican utility has argued that the traders who initiated the deal at its subsidiary weren’t authorized to do so, and some of them have since left, the people said. CFE has also argued it shouldn’t have to fulfill the contract because of the unforeseeable, extreme price action. And it has asserted that Goldman failed to strike a rock-solid contract because it didn’t get an explicit nod from the parent company as a guarantor on the trade, undermining the bank’s ability to extract the money.For Goldman, the dispute boils down to a contractual obligation that its counterparty is duty-bound to fulfill, even if the debt resulted from unforeseen disaster. The bank has also privately argued that such a trade was routinely carried out between the two sides and that the subsidiary even represented in documentation that it had a guarantee from the parent company, a person close to Goldman said. Chat logs during the deal indicate that CFE’s subsidiary was seeking approvals on various aspects of the trade from its parent, the person said.It’s unclear how and when Goldman will be able to realize the money it insists it’s owed, especially as CFE becomes a central part of the Mexican president’s campaign to reshape the domestic energy market.Read More: Mexico Blames U.S. as Energy Crisis Spills Across the BorderSince winning in a landslide in 2018, Lopez Obrador has sought to roll back energy reforms by his predecessor and has said he wants to turn CFE back into an economic champion. He’s broadly blamed private companies for fleecing the nation in deals hatched with corrupt officials, and he’s taken particular issue with gas contracts that he says unfairly benefited businesses at the expense of the state utility.“We are going to continue to comply with the commitment not to increase the price of electricity, even with speculation and the increases in gas prices that are taking place in Texas and the United States,” he said during his morning press conference on Feb. 18.(Updates with comment from CFE spokeswoman in ninth paragraph.)More stories like this are available on bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.