Ervin Johnson Investment Fund

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Over the past 20 years, however, Johnson has proven he has the acumen for more than hoops.

Beverly Hills, Calif.-based Magic Johnson Enterprises now owns or operates gyms, Starbucks coffee shops, Burger Kings, movie theaters and other businesses in 85 cities across 21 states. His Canyon-Johnson Investment Fund has been behind nearly $4 billion in urban revitalization projects that resulted in the creation of 4.5 million square feet of retail and commercial space.

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David Drummond Chairman Google Capital

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David Drummond currently serves as senior vice president of corporate development for Alphabet. He previously served as senior vice president of corporate development and chief legal officer of Google. He joined Google in 2002 and led global teams for legal, public policy, communications, corporate development/mergers and acquisitions, and product quality operations.

He also serves as chairman of Google’s investment arms, Google Ventures and Google Capital. David was first introduced to Google in 1998 as a partner in the corporate transactions group at Wilson Sonsini Goodrich and Rosati, one of the nation’s leading law firms representing technology businesses. He served as Google’s first outside counsel and worked with Larry Page and Sergey Brin to incorporate the company and secure its initial rounds of financing. David earned his bachelor’s degree in history from Santa Clara University and his J.D. from Stanford Law School. He serves on the board of directors of Uber Technologies, Inc., KKR & Co. L.P., and Rocket Lawyer Inc.

Loop Capitol CEO James Reynolds

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James Reynolds, Jr., CFA
Chairman and Chief Executive Officer

James Reynolds, Jr. is founder, Chairman and Chief Executive Officer of Loop Capital. Mr. Reynolds, along with Albert R. Grace, Jr., founded Loop Capital in 1997 with a simple motto as a guide: “To provide client service beyond expectations.” The motto still serves as the foundational driving force of the firm.

Mr. Reynolds currently oversees all aspects of Loop Capital, including investment banking, brokerage and financial advisory services.

Mr. Reynolds has worked in the financial services industry for more than 27 years. Early in his career, Mr. Reynolds established and headed the Midwest Municipal Bond Sales Desk at PaineWebber. Subsequently, Mr. Reynolds joined the Corporate and Institutional Client Group at Merrill Lynch where he managed the municipal sales team responsible for the distribution of all tax-exempt products to institutions in the Midwest. In 1997, Mr. Reynolds collaborated with Albert R. Grace, Jr. to form Loop Capital Markets, where he has led the firm to becoming the largest minority-owned financial services firm and one of the largest privately-held investment banks in the United States. Mr. Reynolds is a CFA charterholder and is a member of the CFA Institute.

Mr. Reynolds strongly believes that successful executives have a responsibility to give back to the community. He currently serves on the boards of buildOn, Chicago United, Skills for Chicagoland’s Future and The University of Chicago Medical Center. Additionally, Mr. Reynolds serves as Vice-Chair of the board for the Chicago Urban League and is a member of the Advisory Board of the Levy Institute/ Kellogg School of Management at Northwestern University. Previously, he was appointed by the Governor to sit on the board of the Illinois Economic Recovery Commission in 2009, and was appointed to serve on the boards of World Business Chicago and the Illinois Sports Facilities Authority by the Mayor in 2011.

Mr. Reynolds holds a Masters of Management in Finance from Northwestern University’s Kellogg Graduate School of Management and a Bachelor of Arts in Political Science from the University of Wisconsin, La Crosse. He holds series 7, 24, 53 and 63 licenses.

Loop Capital’s latest transaction highlights

Loop Capital Serves as Co-Manager on Wal-Mart’s $5 billion Senior Debt Offering / April 4th, 2013

Wal-Mart, the world’s largest retailer, hit the market with a $5 billion four-part offering that included $1 billion of 3-year, $1.25 billion of 5-year, $1.75 billion of 10-year and $1.0 billion of 30-year senior notes.

Loop Capital Serves as Co-Manager on Everglades Re’s $250 million Class A Principal-at-Risk Variable Rate Notes
March 25th, 2013

Everglades Re, a licensed special purpose insurer, followed up on its inaugural hurricane catastrophe bond offering last year, a $750 million 2-year offering – the largest single tranche CAT bond ever done − by issuing another $250 million of CAT bonds to further enhance and reinsure its surplus.

Loop Capital Serves as Co-Manager on PepsiCo’s $2.5 billion Senior Debt Offering

February 25th, 2013

PepsiCo Inc. hit the market with a three-part offering that included $625 million each 3-year fixed and floating rate notes and $1.25 billion of 10-year fixed-rate notes.

Loop Capital Serves as Co-Manager on Zoetis $2.6 billion Initial Public Offering

January 31st, 2013

Pfizer’s former animal health subsidiary, Zoetis, raised $2.6 billion in its initial public offering on January 31, 2013, becoming the largest IPO by a U.S. company since Facebook in May 2012, and the largest carve-out to list on a U.S. exchange in over five years.

Verizon Wireless Announces Sale of Spectrum for $2.1 billion

January 25th, 2013

On January 25, 2013, Verizon Wireless announced that it had signed agreements to complete a number of spectrum license transactions, including sales of licenses to AT&T and Grain Management, a Sarasota, Florida-based private equity firm that invests in the telecommunications sector.

Loop Capital Serves as Senior Manager on $126.2 million offering by the Triborough Bridge and Tunnel Authority

November 23rd, 2012

Loop Capital Markets successfully priced and sold $126,230,000 of The Triborough Bridge and Tunnel Authority’s (“TBTA” or the “Authority”) General Revenue Bonds on November 5-6, 2012, despite the widespread property damage and unprecedented interruption to financial market operations caused by Hurricane Sandy during the prior week.

Loop Capital Serves as Co-Manager on Wal-Mart’s $5 billion Senior Debt Offering
April 4th, 2013

Wal-Mart, the world’s largest retailer, hit the market with a $5 billion four-part offering that included $1 billion of 3-year, $1.25 billion of 5-year, $1.75 billion of 10-year and $1.0 billion of 30-year senior notes.

Loop Capital Serves as Co-Manager on Everglades Re’s $250 million Class A Principal-at-Risk Variable Rate Notes

March 25th, 2013

Everglades Re, a licensed special purpose insurer, followed up on its inaugural hurricane catastrophe bond offering last year, a $750 million 2-year offering – the largest single tranche CAT bond ever done − by issuing another $250 million of CAT bonds to further enhance and reinsure its surplus.

Loop Capital Serves as Co-Manager on PepsiCo’s $2.5 billion Senior Debt Offering

February 25th, 2013

PepsiCo Inc. hit the market with a three-part offering that included $625 million each 3-year fixed and floating rate notes and $1.25 billion of 10-year fixed-rate notes.
Loop Capital Serves as Co-Manager on Zoetis $2.6 billion Initial Public Offering

January 31st, 2013

Pfizer’s former animal health subsidiary, Zoetis, raised $2.6 billion in its initial public offering on January 31, 2013, becoming the largest IPO by a U.S. company since Facebook in May 2012, and the largest carve-out to list on a U.S. exchange in over five years.

Verizon Wireless Announces Sale of Spectrum for $2.1 billion
January 25th, 2013

On January 25, 2013, Verizon Wireless announced that it had signed agreements to complete a number of spectrum license transactions, including sales of licenses to AT&T and Grain Management, a Sarasota, Florida-based private equity firm that invests in the telecommunications sector.

Loop Capital Serves as Senior Manager on $126.2 million offering by the Triborough Bridge and Tunnel Authority

November 23rd, 2012

Loop Capital Markets successfully priced and sold $126,230,000 of The Triborough Bridge and Tunnel Authority’s (“TBTA” or the “Authority”) General Revenue Bonds on November 5-6, 2012, despite the widespread property damage and unprecedented interruption to financial market operations caused by Hurricane Sandy during the prior week.

Read more Loop Capitol

ACT-1 Group

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ACT-1 Group

Companies with staffing, human resources or business concerns turn to Janice Bryant Howroyd for her expertise, and she has built a firm with nearly $1 billion in annual revenue. The North Carolina A&T University graduate founded ACT-1, headquartered in Torrance, Calif., in 1978, and is CEO of what is now the nation’s largest woman- and minority-owned employment-services company. Howroyd is the author of The Art of Work: How to Make Work, Work for You!

Bureau of African Affairs

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Assistant Secretary Linda Thomas-Greenfield leads the Department of State’s Bureau of African Affairs, the division in the Department focused on the development and management of U.S. policy concerning the continent.

There are four pillars that serve as the foundation of U.S. policy toward Africa.

1) Strengthening Democratic Institutions;
2) Supporting African economic growth and development;
3) Advancing Peace and Security;
4) Promoting Opportunity and Development.

Read the full description of the pillars here: U.S. Strategy Toward Sub-Saharan Africa.

15-Year Old Starts Tech Company, He’s Now a Millionaire

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Jaylen Bledsoe is a one-of-kind superstar. The 15-year old sophomore started his own tech company a few years ago, and has found entrepreneurship to be his calling. As a result, he is his own man, and a millionaire because of it.

Jaylen says that he started his firm when he was 12-years old, and plans to attend Harvard after he finishes high school. Jaylen’s company, Bledsoe Technologies, is now worth an estimated $3.5 million. This means that if he manages his wealth in the right way, he will be set for life.

Jaylen doesn’t spend his time memorizing lyrics from the rapper “2Chainz,” smoking weed or chasing girls on Saturday nights. Instead, he spends his time chasing paper, pursuing his dreams and positioning himself for a truly empowered existence. Personally, I’m proud of him. I can also see that he is the beneficiary of good parents and role models. Our kids are like products off an assembly line: The outcomes we see in kids Jaylen’s age are direct products of what they’ve been exposed to on a daily basis. It’s just as easy to manufacture a businessman as it is to manufacture a thug.

Jaylen’s company does web design and other forms of IT consulting for companies located mainly in the Midwest. He actually reminds me of another young person I met recently, Emerson Spartz, the founder of Spartz Media. Spartz is not African American, but both of these young men serve as powerful templates for what our boys can become if given the right guidance.

When I spoke with Emerson, we both agreed that around the age of 12, we probably had ADHD. But we also both agreed that, while ADHD gets you in trouble in school, it can actually be beneficial to have a mind that races from one good idea to the next. Personally, my short attention span caused me to struggle in school until I gained my footing in college. High school felt like prison to me, and my horrible grades reflected that sentiment.

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TAG Holdings LLC

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CEO Joseph B. Anderson leads the Troy, Mich., parent company of a variety of businesses. TAG Holdings controls a Korean and a Chinese plumbing ceramics maker, four automobile wheel-assembly suppliers, and a firm that offers consolidation and warehouse services. Revenue in 2010 was more than $700 million. Anderson is a former White House fellow and a decorated West Point graduate. From 1979 to 1992, he was a General Motors executive. He is a vice chair of the Obama administration’s Manufacturing Council.

Kinder Morgan Energy Partners, L.P.

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Business Summary

Kinder Morgan Energy Partners, L.P. operates as a pipeline transportation and energy storage company in North America. Its Products Pipelines segment delivers gasoline, diesel fuel, jet fuel, and natural gas liquids to various markets through approximately 8,600 miles of refined petroleum products pipelines; and operates 62 associated product terminals and petroleum pipeline transmix processing facilities.

The company’s Natural Gas Pipelines segment gathers, transports, stores, treats, processes, and sells natural gas through approximately 33,000 miles of natural gas transmission pipelines and gathering lines, as well as natural gas storage, treating, and processing facilities. Its CO2 segment produces, markets, and transports carbon dioxide through approximately 1,500 miles of pipelines to oil fields. This segment also owns and operates 7 oil fields, and a 450 mile crude oil pipeline system in west Texas. The company’s Terminals segment transloads, stores, and delivers bulk, petroleum, petrochemical, and other liquids products through approximately 113 liquids and bulk terminal facilities; and approximately 35 rail transloading and materials handling facilities.

Its Kinder Morgan Canada segment transports crude oil and refined petroleum products through approximately 2,500 miles of pipelines from Alberta, Canada to marketing terminals and refineries in British Columbia, the state of Washington, and the Rocky Mountains, as well as in the central regions of the United States.

This segment also operates the Jet Fuel aviation turbine fuel pipeline that serves the Vancouver (Canada) International Airport. Kinder Morgan G.P., Inc. serves as the general partner of the company. Kinder Morgan Energy Partners, L.P. was founded in 1992 and is headquartered in Houston, Texas. Kinder Morgan Energy Partners, L.P. operates as a subsidiary of Kinder Morgan, Inc.

Also See:

Oil trains crowd out grain shipments to NW ports

As oil trains hauling North Dakota crude delay rail transport of grain to Pacific Northwest ports, the prospect of growing fossil-fuel traffic has some fearing that such shipping disruptions will become a long-term problem impeding exports and the regional economy.

Read more FULL ARTICLE

$3 Trillion-Dollar Firms

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Bill Gross and Larry Fink manage $3 Trillion-Dollar Firms Dominating Bonds

April 14 (Bloomberg) — A $3 trillion pile of bonds, an amount almost as big as Germany’s economy. Their firms, Pacific Investment Management Co. and BlackRock Inc., doubled holdings since 2008, outpacing the market’s growth of 50 percent.

Some of the largest hedge-fund firms, including Bridgewater Associates LP and BlueCrest Capital Management LLP, have also more than doubled their investments in debt, data compiled by Bloomberg show. At the same time, Wall Street banks are shrinking their stakes in bonds, Federal Reserve data show.

The lopsided bond market has caught the attention of the U.S. Securities and Exchange Commission. Not only is the SEC examining whether the biggest players get preferential prices and access because of their influence, it’s also worried about what happens when the five-year bond rally ends as U.S. policy makers prepare to raise interest rates.

“It’s going to be interesting to see who’ll take the other side of the trade if there’s a meaningful sell-off, which presents a huge risk,” said Arthur Tetyevsky, a credit-trading strategist at Imperial Capital LLC in New York. “We’re much closer to the end of the rally, that’s for sure.”

The biggest funds’ dominance may make it harder for everyone to sell when the Fed boosts borrowing costs from record lows and sends bond prices tumbling. In essence, their selling may crowd narrowed exits, making it more painful as all investors race to get out of a falling market.

Migrating Hazard
While regulators have looked at the threat to the financial system posed by too-big-to-fail banks, hazard has migrated to money managers. Banks, facing stiffer restrictions on borrowing and the amount of cash they need to keep on hand in the aftermath of the credit crisis, have cut the amount of their own money they use to help clients trade. That reduced role leaves the bond market more vulnerable to ripple effects from the actions of the behemoth managers.

More than five years of near-zero interest rates from the Fed has propelled corporate bonds to record performance and the biggest debt managers have ballooned in size. Pimco, Vanguard Group Inc. and Fidelity Investments manage 39 percent of all mutual fund-owned taxable bonds today, up from 18 percent in 1997, according to Morningstar Inc. data. The smallest 205 fund providers manage 0.1 percent of the market.

“When it comes to fixed-income management, there is an oligarchy,” said Robert Smith, the chief investment officer at Austin, Texas-based Sage Advisory Services Ltd., which oversees about $10.5 billion. “That can be good and that can be bad. It’s bad when you have a market that’s feeling like it’s weak and not doing well and selling off.”

Shrinking Dealers
Just because an investment firm is big doesn’t mean it poses more risk to the financial system, according to BlackRock. Rather than size, regulators should look at how much borrowed money a fund uses as a way to screen for systemic importance, it said in an April 4 letter to the Financial Stability Board. BlackRock said it uses very little leverage across its funds.

“The fact that some firms have gotten larger and some firms have gotten smaller, I’m not sure that’s relevant to secondary trading,” said Richard Prager, head of trading and liquidity strategies at BlackRock. “You have to think about it in terms of the different funds. It’s going to affect all of them equally if the dealers are all shrinking.”

Mark Porterfield, a Pimco spokesman, declined to comment, as did Ryan FitzGibbon, a spokeswoman for Bridgewater, and Ed Orlebar, a representative for BlueCrest.

Two Tiers
At the same time, regulators are examining the way larger firms benefit in markets where transactions are often executed the same way they were a decade ago — through telephone conversations and e-mails.

In this two-tiered market, brokers choose which rivals and clients may see their bond prices on electronic trading systems by turning quotes on and off. Dealers often give bigger investors better prices in return for all of the business they do with Wall Street.

The SEC is examining to what extent smaller buyers are disadvantaged, and whether the behavior constitutes market manipulation, according to two people with direct knowledge of the matter who asked not to be identified because the probe hasn’t been made public.

“For the do-it-yourselfer, the disadvantages are growing by leaps and bounds,” said Marilyn Cohen, who manages $315 million of corporate and municipal bonds as founder of Envision Capital Management Inc. in El Segundo, California. “There’s a smaller and smaller market for money managers that aren’t the size of BlackRock and Pimco.”

Worse Prices
Investors typically get worse prices when they trade smaller blocks of bonds. One day last month, dealers sold $15,000 of steel company ArcelorMittal SA’s bonds maturing in 2041 for 3.5 cents on the dollar more than they paid to buy $25,000 of the same securities an hour later. By contrast, two exchanges of $100,000 or more of the debt that day were within 0.05 cent of one another, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

Finra is examining whether Wall Street firms overcharge investors and whether they unfairly allocate new corporate debt issues to reward certain clients, Nancy Condon, a spokeswoman, confirmed in an e-mail last week.

It’s getting tougher to trade bonds as the business gets less profitable for Wall Street. Corporate-debt trading volumes in the U.S. have failed to keep pace with issuance, increasing 14 percent since 2010 as outstanding notes grew by 33 percent, according to Finra and Bank of America Merrill Lynch index data.

Bondholders Hurt
Requirements that banks hold more cash in the event their investments tank have prompted dealers to reduce their inventories, giving the biggest managers even more sway in the market. The largest dealers had slashed their holdings of corporate bonds to $56 billion as of a year ago from $235 billion in 2007, according to Federal Reserve Bank of New York data. The inventories worked to cushion against price swings and made it easier to trade in larger sizes.

“There may be limits to what regulation can achieve,” New York Fed analysts Samuel Antill, David Hou and Asani Sarkar wrote in a March 27 report. “Financial growth has occurred in the more opaque and harder-to-regulate sectors.”

All bondholders are hurt when the biggest funds unload securities. When investors yanked a record $61.8 billion from broad-market bond funds in the first nine months of last year, it helped spur about $410 billion of losses on $20.5 trillion of U.S. government and corporate debt, Bank of America Merrill Lynch index data show. That was the securities’ worst performance since 1994.

Biggest Withdrawals
Barclays Plc strategist Jeff Meli noted in August that flows are “showing up real time in performance” since dealers aren’t buffering against such lurches as much as they used to.

The New York Fed routinely monitors market liquidity as part of its financial stability role for the central bank, and officials are seeing what they can learn from last year’s bond market sell-off. New York Fed researchers said in an Aug. 5 blog post that the sell-off was “steeper than most historical episodes.”

The funds that attracted the most assets in the previous four years experienced some of the biggest withdrawals. The world’s largest bond fund, Pimco’s Total Return Fund, for example, reported $8.3 billion of outflows in the first three months of 2014. That overwhelmed $6.4 billion of inflows into the rest of funds in its category, Morningstar data show.

Verizon Deal
The largest bond-fund managers have been able to amass a disproportionate amount of securities over the past five years partly by getting first dibs on new corporate-bond sales. The SEC is also investigating whether banks are fairly divvying up new issues and whether they give preferential treatment to top clients.

Bankers gave almost half of Verizon Communications Inc.’s record $49 billion bond sale in September to just 10 firms, people with knowledge of the matter said at the time. The price instantly jumped, handing those buyers about $2.5 billion in gains just one day after issuance.

Newport Beach, California-based Pimco purchased $8 billion of the Verizon debt and BlackRock bought about $5 billion, people familiar with the sale said at the time. Fink, 61, is chief executive of New York-based BlackRock and Gross, 70, is chief investment officer and co-founder of Pimco.

Robert Varettoni, a spokesman for Verizon, declined to comment on last year’s bond sale.

Being Big
“With the bond market you want to be big,” said Michael Rawson, an analyst at Morningstar in Chicago. “If you’re too small, it’s hard to get a decent allocation and good pricing.”

Being big can cut costs by having many different funds rely on the same people to trade, analyze and process specific bonds.
“They can lower their fees,” said Andrew McCollum, a managing director at Greenwich Associates in Stamford, Connecticut. “That’s the reason the big managers are getting bigger — they can basically do the same thing for a lower cost.”

BlackRock oversees $1.2 trillion of debt, compared with $483.2 billion in December 2008, according to the firm’s financial filings. Pimco manages $1.9 trillion of assets, with more than 90 percent in bond-related funds, versus $960 billion of assets five years earlier.

Enjoying Perks
Bridgewater’s All Weather fund, which emphasizes debt- related investments, has quadrupled since the end of 2009 to about $80 billion in assets, according to data compiled by Bloomberg. BlueCrest, co-founded by former JPMorgan Chase & Co. proprietary trader Michael Platt, has expanded to include about $32 billion of assets since its 2000 inception.

Hedge funds with more than $1 billion under management hold 59 percent of debt assets among similar firms, up from 29 percent in 2008, according to data compiled by Eurekahedge Pte Ltd., an alternative investment research firm, on relative-value strategies.

While they enjoy perks, bigger funds can also have a harder time being nimble as trading falls as a proportion of the overall market.

Pimco has faced withdrawals at the same time former Chief Executive Officer Mohamed El-Erian resigned in January.
Worst Returns

Its $232 billion Total Return Fund produced the worst risk- adjusted return over the past year among 16 U.S. intermediate- term funds with at least $5 billion in assets, according to the Bloomberg Riskless Return Ranking. As shorter-term debt tumbled in anticipation of rising interest rates, Gross’s fund posted the second-worst returns and second-highest volatility in the group.
When Gross sells, it resonates throughout the market — and a world of falling bond prices may be about to take hold. Analysts surveyed by Bloomberg predict yields on the 10-year Treasury note will climb to 3.33 percent at year-end and to 3.6 percent in the first half of 2015 from 2.62 percent on April 11.

The SEC’s priorities for the year include monitoring “the risks associated with a changing interest-rate environment and the impact this may have on bond funds,” according to a January memo from the agency’s Office of Compliance Inspections and
Examinations.

“There’s a market until there isn’t one,” said Tim Gramatovich,
who helps manage more than $800 million as chief investment officer of Santa Barbara, California-based Peritus Asset Management LLC. “What happens when there’s no bid?”

–With assistance from Charles Stein in Boston, Alexis Leondis, Miles Weiss and Craig Torres in Washington and Christine Harper in New York.

To contact the reporter on this story: Lisa Abramowicz in New York at labramowicz@bloomberg.net To contact the editors responsible for this story: Bob Ivry at bivry@bloomberg.net Caroline Salas Gage

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