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

FRIDAY - SUNDAY, SEPTEMBER 22 - 24, 2017 ~ VOL. XXXV NO. 165 WSJ.com EUROPE EDITION
DJIA 22359.23 g 0.24% NASDAQ 6422.69 g 0.52% NIKKEI 20347.48 0.18% STOXX 600 382.88 0.24% BRENT 56.43 0.25% GOLD 1290.60 g 1.63% EURO 1.1939 0.37%

Hurricane Maria Leaves Puerto Rico in Dire Shape Trump

Whats Targets
News North
Business & Finance

T op SEC officials werent

told until recently about a
Korean
2016 cyberattack, raising
doubts about how the breach
was initially handled. A1
Trade
 Benchmark has said it is President Donald Trump
unlikely to sell its shares in launched a new phase of a
Uber, complicating a poten- crackdown on North Korea on
tial $93 billion investment Thursday, signing an executive
deal with SoftBank. B1 order he said will expand U.S.
authority to target individuals,
 Cat-bond investors could
companies and financial insti-
be on the hook for up to
tutions involved in business
$150 million after two earth-
with Pyongyang.
quakes struck Mexico. B1
 CVS will limit opioid pre- By Louise Radnofsky in
scriptions to seven days or New York and Ian
less for certain patients in a Talley in Washington
ALEX WROBLEWSKI/GETTY IMAGES

bid to fight addiction. B3

Foreign banks will face a
 Whole Foods plans to
clear choice: Doing business
change the way companies
with the United States or facil-
can sell and market their
itate trade with the lawless re-
products in its stores. B3
gime in North Korea, Mr.
 The EU said it is ready Trump said in remarks at a
to propose new taxes on lunch with leaders of South
tech firms by next spring if Korea and Japan alongside
there isnt adequate global CRISIS: The strongest storm to hit the island in decades destroyed its power grid and crippled communications. A damaged home, above. A5 United Nations meetings.
progress on new rules. B4 Also, European Union offi-
cials agreed in principle to in-
 Commonwealth Bank of

SEC Response Is in Focus

crease the blocs unilateral
Australia is selling its life-in-
sanctions on North Korea by
surance operations to AIA for
adding new individuals to
$3.05 billion and may shed its
their asset freeze and travel
asset-management unit. B5
ban list, according to people
 The ECB plans a new familiar with discussions.
overnight interest rate as Top officials informed breach was initially handled. Donald Trump, revealed the Analysis, and Retrieval Sys- Names under discussion for
an alternative to scandal- The SEC revealed the hack, breach and a related investiga- tem, known as Edgar. new sanctions include North
plagued benchmarks. B5 only recently of 2016 which occurred and was de- tion on Wednesday night, say- Former SEC Chairman Mary Korean leader Kim Jong Un,
 Postal Savings Bank is hack into system for tected last year, for the first ing the commission learned in Jo White, who led the agency but one official said there was
time on Wednesday. SEC Com- August that the breach could in 2016, declined to comment no agreement yet on who
raising up to $7.6 billion in corporate filings missioner Michael Piwowar, have enabled illegal trading. when asked about the hack. would be targeted once the
one of the largest-ever
who ran the SEC as acting The report follows Equifax The agency appeared not to new measures are final.
sales of offshore securities
BY DAVE MICHAELS chairman for three months Inc.s disclosure of a breach of have followed the typical pro- The bloc had said earlier
by a Chinese lender. B5
AND JEAN EAGLESHAM earlier this year, said he was its systems that affected 143 tocols for public companies, this month it was looking at
 Impax Labs is in merger only recently informed. An- million Americans. where cybersecurity issues ways to increase pressure on
talks with rival generic- WASHINGTONTop Securi- other SEC commissioner, Kara Mr. Piwowar, who led the are overseen by the board of Pyongyang.
drug maker Amneal. B3 ties and Exchange Commission Stein, was informed of the agency as its acting chairman directors, said Thomas Spor- Mr. Trump also praised Chi-
officials werent told until re- breach this week, a person fa- from late January until early kin, a former SEC enforce- nese President Xi Jinping for a
 U.S. oil is trading at the
cently about a 2016 cyberat- miliar with the matter said. May, said he was recently in- ment official. recent move by Beijings cen-
biggest discount to the
tack that penetrated its system SEC Chairman Jay Clayton, formed for the first time You would have expected tral bank to bar transactions
global price in two years. B8
for company filings, raising who started work in May after about the hack into the SECs the commission to have been with North Korea. China ac-
questions about how the his nomination by President Electronic Data Gathering, Please see HACK page A2 Please see KOREA page A4
World-Wide

 Trump signed an execu- INSIDE Stock Pickers Now Watch

tive order targeting trade
with North Korea, launch-
GERARD FOUET/AGENCE FRANCE-PRESSE/GETTY IMAGES

ing a new phase of a crack-

down on Pyongyang. A1
 Rescue workers continued
to search for survivors from
Passive Funds for an Edge
BY CHRIS DIETERICH and out of such funds as they valuations, generally remain
the Mexican quake that killed AND CORRIE DRIEBUSCH size up whether to buy or sell most important to stock pick-
at least 230 people, with shares of a company. ers. But with passive investing
hundreds still missing. A3 Stock pickers, who for so This new type of analysis this year representing about
 Puerto Rico is emerging long decried the rise of pas- shows how the rise of passive 29% of assets in domestic
crippled after Hurricane Ma- sive investing, are now trying investingtracking a basket of stock funds alone, according
ria hobbled its telecom sys- to profit from it. securities rather than picking to Moodys Investors Service
tem, destroyed its power grid In what is emerging as a individual onesis changing a figure the firm sees topping
and flooded communities. A5 nascent line of market re- the makeup of markets. Even 50% as soon as 2021inves-
search across Wall Street, in- active investors are now re- tors who pick single stocks are
 A U.S. demand to reopen vestors are attempting to puz- signing themselves to the in- paying attention.
the Iran nuclear deal has left
Europe scrambling to heed HEIRESS IKES LONDON zle out how passive investing
creates opportunitiesor pit-
fluence of indexing and are
contriving ways to take advan-
When I think about what
makes a stock tick, it comes
U.S. concerns without spark- TO LORAL HEADQUARTERS fallsfor individual stock tage of its impact. back to earnings, the quality of
ing an Iranian walkout. A4
 Iraqs army launched an
FORTUNE DIES GO HIGH-END trading. They are looking at
factors such as the percentage
The research, by investors
and academics alike, is largely
management and the ability of
a company to execute, but be-
offensive to drive Islamic of a stock owned by index in its infancy, many say. And ing in an ETF is a factor to be
State from one of the groups BUSINESS & FINANCE, B1 MANSION, W9 funds and money flows into fundamental factors, such as Please see ETF page A2
few remaining strongholds
in the country. A4
 Opponents of a GOP plan
ALDIS PLAN TO Filipino
to dismantle most of the ACA
are scrambling to ramp up Protesters
resistance before a possible
Senate vote next week. A5 WIN THE U.S. Decry
Duterte
 Mueller is seeking to de-
termine what White House
officials knew about a probe
GROCERY WARS DISSENT:
of ex-national security ad- Thousands of
viser Flynn early this year. A5 demonstrators in
 Saudi Arabias king plans
Secretive giant offers bare-bones stores and rock- Manila rallied
against President
to discuss Syria, the Qatar bottom prices; formula will further roil industry Rodrigo Dutertes
blockade and oil output with deadly war on drugs
Putin next month in Russia BY ZEKE TURNER countries and annual reve- and strongman
as political ties deepen. A3 nues approaching 70 bil- style. The protests
 S&P became the last of MLHEIM AN DER RUHR, lion, or $83 billion. extend weeks of
the three major rating firms GermanyDim lighting This summer, Aldi opened backlash since the
to lower its view on Chinas bounces off brownish-tiled a new chapter in this seem- alleged execution of
creditworthiness. A4 floors. The shelves are ingly unstoppable expansion, a teenager by police
sparsely filled with card- announcing a $3.4 billion in- last month. A4
 Died: Liliane Bettencourt, board boxes. Checkout lines vestment to boost its U.S. NOEL CELIS/AGENCE FRANCE-PRESSE/GETTY IMAGES
94, LOral heiress and the stretch to oblivion. presence by nearly 50% to
worlds richest woman. B1 There is nothing super 2,500 stores by the end of
about these stores. 2022. This puts the company
CONTENTS
Books...................... A7-9
Business News...... B3
Markets...................... B8
Off Duty.............. W1-8
Opinion.............. A10-11
Yet their owner, German
discounter Aldi, is betting
on a pace to become Amer-
icas third-biggest grocery
Silly Rabbit! Original Trix Is Back After Fan Revolt
Crossword.............. A12 Technology............... B4 billions it can win over retailer by locations behind i i i
Heard on Street.... B8 U.S. News.................. A5 spoiled American shoppers. Wal-Mart Stores Inc. and
Life & Arts.............. A12 Weather................... A12
Mansion............ W9-14 World News....... A2-4
How? By offering them fewer Kroger Co. The land grab Use of radishes, turmeric riled customers; Its basically a salad now
choicesway fewerthan ri- closely followed its decision
3.20; CHF5.50; 2.00; val retailers. to invest $1.6 billion in reno- BY ANNIE GASPARRO lesson the hard way af-
U.S. Military (Eur.) $2.20
The unlikely proposition vating the bulk of its exist- ter it started selling all-
has worked nearly every- ing 1,700-plus U.S. stores, Yes, some consumers are natural Trix in early 2016
where Aldi has set foot. The some of which have been clamoring for cold-pressed made instead with radishes,
company that started from a around since the 1970s. beet juice and quinoa chips. purple carrots and turmeric.
simple suburban grocery The American grocery But that doesnt mean they Change it back!! wrote
store in Germanys industrial market, one of the largest dont also want Red 40, Blue 1 Denver-area mother and pho-
northwest is now one of the and most competitive in the and Yellow 6. tographer, Ashley Carara, on
s Copyright 2017 Dow Jones & biggest retail groups in the world, is on the cusp of dra- General Mills Inc., maker of Facebook shortly after the
Company. All Rights Reserved
world with more than 10,000 matic change since Ama- Trix, the iconic child-friendly new recipe hit shelves.
locations, businesses in 18 Please see ALDI page A6 breakfast cereal, learned this Original Trix Please see TRIX page A6
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 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

WORLD NEWS

Chechnya Leader Seeks Global Muslim Role The Chechen leaders lat- with their paradesbroadcast
est intervention in the Myan- on his Instagram feedpunc-
mar crisis didnt please the tuated by pledges of loyalty
Moscow establishment. and cries of Allahu akbar.
Russian foreign policy in

B
terms of making major deci- ecause of this auton-
sions is very much central- omy, Mr. Kadyrov of-
MIDDLE EAST ized. This means that Kady- fers a Sunni alternative
rovs dmarche was met with to existing Islamist move-
CROSSROADS irritation at the foreign min- ments in the Middle East.
By Yaroslav Trofimov istry and by the leadership Unlike the theology of Is-
in general, said Andrey Kor- lamic State or al Qaeda, his
tunov, director of the Rus- brand of Islamismcolored
When the exodus of Roh- sian International Affairs by the relatively moderate
ingya Muslims from Myanmar Council, a state-run think Sufi tradition espoused by
began a month ago, some of tank in Moscow. his late fatherisnt hostile
the loudest protests erupted to Shiites and appeals to mil-

O
in an unexpected corner of n the other hand, Mr. lions of followers of Sufi reli-
the Muslim world: Russias Kadyrov could play a gious orders in the region.

BAIRAKOV ZUBAIR/ZUMA PRESS

republic of Chechnya. valuable role for Rus- In part in recognition of
In the capital Grozny, sia in the broader Muslim this status, Mr. Kadyrov over
Chechen leader Ramzan world just as the country the past year was received
Kadyrov pre- faces widespread criticism with honors far above those
sided over a for its involvement alongside of a provincial Russian gover-
Sept. 4 rally in the Iran-led Shiite axis in the nor when visiting Muslim na-
solidarity with Syrian war. tions, particularly by the mon-
the Rohingya As a young rebel, Mr. archies of the Persian Gulf.
that, accord- Muslims rallied this month in Grozny in solidarity with the Rohingya, a Muslim minority in Myanmar. Kadyrov used to fight against Those included even Saudi
ing to official Russian forces in Chechnyas Arabia, with which Mr. Kady-
count, was attended by a mil- strictly than in many Middle in the southern Philippines. just as his patron, President war of secession. His father rov has reconciled of late.
lion people. He proposed, East nations, the Myanmar Vladimir Putin, was visiting Akhmad, Chechnyas former Kadyrov is a man of big

N
among other things, dropping crisis has provided an oppor- o matter how power- the crucial ally of Myanmars mufti, or most senior Sunni ambitions. He plays the role
a nuclear bomb on Myanmar tunity to become an Islamic ful he is, though, Mr. government, China. Islamic scholar, once for- of an unofficial Russian envoy
to stop what he called a leader of global stature. The Kadyrov isnt a head In recent months, Mr. mally declared jihad against in the countries of the Middle
genocide of Muslims. protests also cemented his of state. And for Russia, his Kadyrov has also issued Russiaonly to switch sides East, said Dmitri Trenin, di-
Another large Muslim pro- status as one of Russias pretensions to a global man- harsh threats to Israel over and become the regions rector of the Carnegie Mos-
test, also with the involve- most powerful men, and he tle present a policy dilemma. its decision, since reversed, president under a peace deal cow Center. Yes, sometimes
ment of Chechen representa- increasingly speaks on behalf On one hand, many of Mr. to unilaterally impose new with Moscow. The elder Mr. he makes statements that go
tives, paralyzed central of the countrys estimated Kadyrovs recent initiatives security measures at a Jeru- Kadyrov was assassinated by further than or contradict
Moscow and forced Myanmar 20 million Muslim citizens. didnt coincide with Moscows salem compound where the jihadist insurgents opposed Russias official position. But
diplomats to temporarily Exploiting far-flung Is- foreign-policy priorities. In Al Aqsa mosque is located. to the peace deal in 2004. in general he promotes Russia
abandon their embassy there. lamic causes has long been a Myanmar, for example, Russia Last year, Mr. Kadyrov con- Chechnya today feels like a as a state with a large Muslim
For Mr. Kadyrov, a 40- winning strategy for other has long been a major sup- vened an international Is- separate country. While community and therefore a
year-old who has turned authoritarian leaders. Libyas porter and supplier of that lamic conference that essen- Chechnyas security forces state that has the right to par-
Chechnya into a personal fief Moammar Gadhafi, for one, countrys military. It didnt tially declared Saudi Arabias theoretically report to Mos- ticipate in all Muslim affairs.
where Islamic laws and cus- used to be an enthusiastic help that Mr. Kadyrov made dominant school of theology cow, in practice they are Mr. And thats something positive
toms are enforced more supporter of Muslim rebels his inflammatory statements outside the pale of Islam. Kadyrovs praetorian guard, for Russian foreign policy.

HACK against a public company that

misled investors about a hack
affecting share prices.
Mr. Clayton is sure to face
mercial information, said Mr.
Warner. The Senate Banking
Committee oversees the SEC.
Edgar was launched during
ers exploited a vulnerability in
part of Edgar that allows com-
panies to test the accuracy of
data transmitted in new forms.
Continued from Page One questions about the event next the 1990s to equalize access to Newly appointed directors and
informed of a breach to an week, when he is scheduled to information among retail and officers often file test forms
PABLO MARTINEZ MONSIVAIS/ASSOCIATED PRESS

SEC database that houses in- testify before the Senate Bank- sophisticated investors, but that reveal the extent of their
formation critical to inves- ing Committee. Sen. Mark has occasionally caused head- ownership of company stock
tors, said Mr. Sporkin, now a Warner (D., Va.), a member of aches for the commission. Ac- or options, Mr. Lane said.
partner at the law firm Buck- the panel, said he planned to ademic researchers found in We face the risks of cy-
ley Sandler LLP. ask Mr. Clayton about the du- 2014, for instance, that hedge berthreat actors attempting to
Mr. Claytons statement de- ties of public companies to funds and other investors got compromise the credentials of
scribed other SEC vulnerabili- earlier access to market-mov- authorized users, gain unau-
ties to hackers, but provided ing documents than other us- thorized access to filings data,
few details about the intru- ers of the standard, web-based place fraudulent filings on the
sion, possible trading or which
Its not great optics system, giving them a poten- system, and prevent the public
companies might have been if the agency itself is tial edge. The SEC later said it from accessing our system
affected. The SEC hasnt re- fixed the problem. through denial of service at-
sponded to requests for addi-
hacked, said a former The system ingests a moun- SEC chief Jay Clayton is sure to face questions on Capitol Hill. tacks, Mr. Clayton said in his
tional details. enforcement official. tain of data, filed by thou- statement Wednesday.
Mr. Clayton, a former cor- sands of public companies and the SEC closes the file. LLP. The forms are withheld David Smyth, a former SEC
porate lawyer, has a deeper brokerage firms and mutual Seeing that type of infor- from investors as companies enforcement official who is
background in cybersecurity funds. While most filings are mation before it is released receive feedback on the disclo- now a partner at law firm
than many of his predecessors. disclose when they are hacked. made public as soon as they publicly could allow a hacker sures from the SEC staff. See- Brooks, Pierce, McLendon,
He led Sullivan & Cromwell Yahoo Inc. took two months to are received, some other to gain insight into a pending ing the forms during that Humphrey & Leonard LLP, said
LLPs cybersecurity practice disclose to the public and its forms arent meant to be dis- accounting restatement, which phase would provide fascinat- the SEC is in a difficult posi-
and retained a cybersecurity shareholders after learning closed immediately and could would hurt a companys stock ing insight into a private com- tion because it is subject to
adviser, Christopher R. Hetner, that 500 million user accounts be juicy targets for hackers. price, said Richard Truesdell, panys earnings, but a hacker the same cyberthreats as the
who was formerly chief infor- were hacked in 2014. One example: correspon- head of capital markets at Da- couldnt immediately profit rest of Wall Street.
mation security officer at GE The SECs disclosure, dence that shows the SECs vis Polk & Wardwell LLP. from the information because But its not great optics if
Capital. which comes not even two feedback on disclosures such The Edgar system also the stock isnt yet trading on the agency itself is hacked, he
SEC officials routinely ex- weeks after Equifax revealed as annual reports. The letters stores confidential forms that an exchange, Mr. Lane said. said. I do find the fact that
amine the cybersecurity de- that it had been hacked, shows often focus on questions of ac- companies file when they sell Mr. Claytons statement the hack wasnt disclosed to
fenses of brokerage firms and that government and busi- counting judgment and lead to shares for the first time, didnt identify the precise date the commissioners themselves
investment advisers and have nesses need to step up their companies updating language known as registration state- of the intrusion or what sort quite surprising, he added.
sometimes indicated they efforts to protect our most in filings. The letters typically ments, said Brian Lane, a part- of nonpublic data was ob- Tatyana Shumsky
could take enforcement action sensitive personal and com- become public 20 days after ner at Gibson Dunn & Crutcher tained. The agency said hack- contributed to this article.

ETF list, he said.

So far, researchers say, the
influence of passive investing
is most pronounced for mid-
U.S. stocks, prompted by client
demand. He found dozens of
small and midsize companies
with more than 20% of their
shares.
Some $5 billion flowed into
the largest ETF tied to this in-
dex, the iShares Russell 2000
true float of available shares
is diminished, she said.
Stocks with more float
held by passive funds exhibit,
biggest single owners. Trading
volume during the session
when Meredith was added to
the index was the heaviest in
Continued from Page One size- and small-company shares outstanding owned by ETF, in the month after the on the margin, higher volatil- more than a year, according to
aware of, said Christopher stocks, which generally trade ETFs. election. KBW estimates that ity, Ms. Subramanian said. FactSet.
Marinac, director of research at less frequently than the larg- Mr. Patel said one-way ETF flows into all financial Still, being owned by in- We have seen inclusion in
Atlanta-based FIG Partners, of est ones. money flows into or out of in- ETFs, plus the small-cap stock dexes can be a good thing. indexes add to demand for
exchange-traded funds, a popu- Pankaj Patel, head of quan- dex funds potentially create ETF, resulted in 24% of share Nearly 40% of the tradable Meredith stock, said Mike
lar form of index investing. titative research at Cirrus Re- opportunities for active man- turnover in Southwest Ban- shares of Meredith Corp., a Lovell, Merediths director of
Passive ownership is not search, in Tarrytown, N.Y., this agers who, for example, might corp Inc. in the month after media company with a market investor relations. He said the
first or second on the list, but year published a series of re- opt to hold a stock longer than the election and 23% in First capitalization of $2.4 billion, is company doesnt manage its
now it is definitely on that ports on ETF ownership of they might otherwise when Connecticut Bancorp Inc. owned by passive mutual and business with an aim toward
flows are cresting, or pare These small banks stock exchange-traded fundsmore index inclusion, but added that
back a holding sooner if prices rose 28% and 27%, re- than any stock in the U.S. mar- its fundamentals, including a
Passive Power money is moving out. spectively, over that period. ket, according to Steven De- long record of paying divi-
These companies top the charts in their sector for passive Portfolio managers should ETFs arent really driving Sanctis, a small- and midcap dends, tick many boxes for in-
ownership, according to a Wall Street rms analysis. be aware of heavy ETF owner- performance, but flows can ex- analyst at Jefferies. dexes that screen for such
ship, Mr. Patel said. It can be acerbate performance, Ms. Passive ownership in Mere- traits.
Market Shares owned by passive funds an advantage when flows are Bermingham said. dith received a major boost in
Company Sector value ETFs Mutual funds Total
positive, but you want to be Research from Savita Sub- January, when the stock was THE WALL STREET JOURNAL.
careful when they turn ramanian, equity and quantita- tapped for inclusion in an in- Europe Edition ISSN 0921-99
Consumer The News Building, 1 London Bridge Street,
Meredith Corp. $2.4B 27.1% 12.6% 39.7% around. tive strategist at Bank of dex that powers the $16 billion
discretionary London, SE1 9GF
Analysts say Novembers America Merrill Lynch, sug- SPDR S&P 500 Dividend ETF,
presidential election provided gests that companies with a which includes only companies Thorold Barker, Editor, Europe
Tanger Factory Grainne McCarthy, Senior News Editor, Europe
Real estate $2.4B 16.8 20.2 37.0 a case study for the effects of larger proportion of tradable that have raised dividends for Cicely K. Dyson, News Editor, Europe
Outlet Centers
passive investing on small-cap shares in passive funds tend to 20 years in a row. In a matter Darren Everson, International Editions Editor
Waddell & Reed stocks. see heightened choppiness of days, the ETF bought nearly Joseph C. Sternberg, Editorial Page Editor
Financials $1.5B 21.6 13.3 34.9
Financial Inc. Roughly $9 billion poured since fewer shares are avail- three million Meredith shares
Anna Foot, Advertising Sales
into more than two dozen fi- able for active traders. The and became one of the stocks Jacky Lo, Circulation Sales
Black Hills Corp. Utilities $3.7B 19.8 13.9 33.7 nancial-stock ETFs in the Andrew Robinson, Communications
month following the election,
CORRECTIONS  AMPLIFICATIONS
Jonathan Wright,
according to Keefe, Bruyette & Global Managing Director & Publisher
The Medicines Co. Health care $2.5B 12.6 20.3 32.9 Woods. Melissa Roberts and Advertising through Dow Jones Advertising
Pell Bermingham, quantitative Sales: Hong Kong: 852-2831 2504; Singapore:
analysts at the firm, found Hoffman-Madison Water- it was Madison Marquettes 65-6415 4300; Tokyo: 81-3 6269-2701;
ManTech Frankfurt: 49 69 29725390; London: 44 207
Technology $1.6B 16.7 13.5 30.2 that ETF flows had a meaning- front, a partnership between project and incorrectly said
International Corp. 842 9600; Paris: 33 1 40 17 17 01;
ful impact both on the daily real-estate firms Madison the project was valued at $2 New York: 1-212-659-2176
ABM
Industrials $2.5B 15.7 13.6 29.3
trading volumes and perfor- Marquette Inc. and PN Hoff- billion. Printers: France: POP La Courneuve; Germany:
Dogan Media Group/Hrriyet A.S. Branch; Italy:
Industries Inc. mance of certain financial-sec- man & Associates Inc., in Oc- Qualiprinters s.r.l.; United Kingdom: Newsprinters
(Broxbourne) Limited, Great Cambridge Road,
tor stocks. Shares of compa- tober is opening the first Australian physician John Waltham Cross, EN8 8DY
H.B. Fuller Co. Materials $2.8B 14.0 14.1 28.1 nies included in financial ETFs phase of a $2.5 billion mixed- Vallentine previously taught Registered as a newspaper at the Post Office.
rose by a median 19.4% over used waterfront development medical ethics. A Page One ar- Trademarks appearing herein are used under
license from Dow Jones & Co.
Consumer
the period, compared with in Washington. A Property Re- ticle on Monday about aid 2017 Dow Jones & Company. All rights reserved.
Editeur responsable: Thorold Barker M-17936-
Universal Corp.
staples
$1.5B 13.3 14.4 27.7 14.2% for financial stocks not port article on Wednesday groups working to rescue mi- 2003. Registered address: Avenue de Cortenbergh
in these ETFs, they found. about open-air shopping cen- grants in the Mediterranean 60/4F, 1040 Brussels, Belgium
The passive effect was com- ters and mixed-use property Sea incorrectly called him a NEED ASSISTANCE WITH
Archrock Inc. Energy $829M 13.0 13.9 26.9
pounded, they said, because developments incorrectly said professor of medical ethics. YOUR SUBSCRIPTION?
many financial-sector stocks By web: http://services.wsje.com
are included in the Russell By email: [email protected]
Note: Rankings include components of the Russell 3000 Index of small, medium and large stocks. Readers can alert The Wall Street Journal to any errors in news articles by By phone: +44(0)20 3426 1313
Sources: Jefferies (passive ownership); FactSet (market cap) THE WALL STREET JOURNAL. 2000 index of small-company emailing [email protected].
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. * Friday - Sunday, September 22 - 24, 2017 | A3

WORLD NEWS
Populists Redirect German Campaign
Supporters say AfD tential threat posed by Muslim until now, said civil servant counting his own center-left
immigration. Protest Vote Uwe-Schulz Kopanski, refer- Social Democrats among those
party is speaking The AfD, as the party is Some typical characteristics of Alternative for Germany voters ring to immigration as the big- guilty of losing touch.
plainly of old taboos; known, is now polling at above are outliers when compared with backers of other parties. gest one. These lies, these Ms. Merkel closed her
10%less than its peak early lies, these liespeople have speech on Tuesday by warning
calling out lies this year and well below what Alternative for Germany Social Democrats Christian Democrats* had enough. that isolationism could carry
Free Democrats Left Greens
other far-right parties else- In the center of Wismar, a big risks for a country that
BY ANTON TROIANOVSKI where in Europe have gar- AfD supporters are more likely to be male Baltic seaport town of about makes much of its wealth from
nered in recent elections. But Percentage of male supporters 45,000 people, an outdoor- exports. We must understand
WISMAR, GermanyCandi- for Germany, if the polls hold, goods store advertises $7 cans that we cannot only take care
date Georg Pazderski of the its impending entry into par- 40% AfD: 69% of self-defense spray next to of ourselves, she said.
anti-immigrant Alternative for liament will mark a turning tend to live in less densely populated areas the thermoses and water bot- The previous day, leading
Germany spent nearly half his point in a country where Percentage of supporters in towns with fewer than 20,000 people tles in its window. AfD politicians took a different
25-minute speech in this har- right-wing populism has long The demand is very, very tack at their own rally here.
bor town earlier this week been banished from main- 32% 55% high in Wismar, because there The mainstream parties have
highlighting the danger of Is- stream discourse. And it will are many foreigners, an em- yet to see reason and finally
lamist terrorism. Chancellor show that despite Germanys ...have blue-collar jobs ployee said. take care of the security of
Angela Merkel dispatched the thriving economy, an under- Percentage of supporters classied as laborers Around the corner in City German citizens, Mr. Pazder-
topic in roughly 80 seconds in current of popular distrust Hall, Mayor Thomas Beyer ski said. He and deputy party
an address here the next day. and discontent threatens to in- 9% 34% said the share of foreigners in chairwoman Beatrix von
As this countrys election creasingly unsettle a largely town had increased to about Storch both said deportations
campaign reaches its cre- stable political system. ...and earn less 6% from 4% since 2015, in part of rejected asylum seekers
scendo ahead of Sundays vote, The unease is especially ap- Average hourly wages because of the influx of asy- were happening too slowly.
its participants increasingly parent here in the former East lum seekers. The data dont In addition to a heart, we
appear to be fighting different Germany, where unemploy- 14.56 26.83 show any increase in violent have a brain, Ms. von Storch
battles. Ms. Merkel, looking ment is higher and the main- *Includes Bavarian sister party Christian Social Union
crime as a result, he said. But, said of her party.
assured of victory, is engaging stream political parties are Sources: German Institute for Economic Research analysis based on an ALLBUS survey of he noted, many voters were This is a party thats fi-
her opponents in mainstream less deeply anchored than in about 3,500 respondents conducted in March-September 2016 (male support, residence, unsettled by changeand a nally showing protest, said
parties on pensions, infra- the more-prosperous former employment); SOEP panel study, 2015 (wages) significant number were sup- Martin Schmaltz, a 28-year-
THE WALL STREET JOURNAL.
structure, education, and eco- West. But AfD is drawing ris- porting the party that has be- old bus driver at the event in
nomic policy. The Alternative ing support from across the come Germanys most promi- Wismar who was considering
for Germany, meanwhile, is country, polls show. coast, yielded one common violent crime committed by nent symbol of protest against voting for the AfD. The party,
creeping up in the polls while Interviews with AfD sup- complaint: Mainstream politi- immigrantsseriously enough. the establishment. he said, says what the Ger-
positioning itself as the only porters conducted in recent cians, the voters said, dont The party clearly discusses The parties, in part, no man citizen has on the tip of
party sounding the alarm weeks, from the German take their concerns about im- problems that all the other longer speak the language of his tongue but cant say out
about what it says is the exis- southwest to the Baltic sea- migrationincluding fears of parties have been concealing the people, Mr. Beyer said, loud.

BRUSSELS BEAT | By Marcus Walker

Energy Alliance
Propels Russia-
Saudi Cooperation
Saudi Arabias King Salman ergy-investment fund and the
plans to discuss Syria, the Qa- first Saudi imports of liquefied
tar blockade and oil produc- natural gas from Russia, ac-
tion with Russian President cording to Russian and Saudi
Vladimir Putin next month in officials.
Russia, according to people fa- Saudi oil officials are con-
miliar with the matter, as en- sidering stakes in LNG proj-
ergy cooperation deepens po- ects led by Russian companies
litical ties between the two OAO Novatek and state energy
former foes. giant, PAO Rosneft, people fa-
miliar with the matter said.

ANTONIO PISACRETA/ROPI/ZUMA PRESS

By Summer Said Saudi Arabia has other
in Riyadh sources for many of the im-
and James Marson ports that Russia could pro-
in Moscow vide, including weapons, bar-
ley, pig iron and refined
In the first visit to Russia copper. The LNG deals under
by a Saudi monarch, King Sal- discussion could take months
man is expected to give his to come together or not hap-
support for new cease-fires pen at all, people familiar with
and de-escalation zones in the talks said.
Syria, where Riyadh and Mos- But the countries have polit- German Chancellor Angela Merkel appeared at a campaign rally in Freiburg on Monday. Victory for her party looks inevitable.
cow have been on opposing ical reasons to move closer and

Grip Weakens for Established Parties

sides, the people said. cite their oil coordination as a
The king is also expected to first move to build trust as
cement a deal with Russia to ex- they try to tackle broader eco-
tend efforts to withhold global nomic and geopolitical issues.
oil supply and prop up crude In May, Mr. Putin spoke
prices through the Saudi-led Or- about Syria with then-Deputy Germanys seemingly pre- In swaths of Continental ter-left parties were rooted in ences between her Christian
ganization of the Petroleum Ex- Crown Prince Mohammed bin dictable election campaign Europe, the established cen- organized labor, old center- Democrats and other main-
porting Countries, the people Salman, the kings son who may well have a twist in its ter-right and center-left par- right parties in churches. Both stream parties. She could
said. Russia isnt a member of has since been elevated to tail. ties have suffered far more have declined. Social media form her next coalition gov-
OPEC, but its cooperation was crown prince and heir appar- If the last opinion polls dramatic collapses, while pop- have broadened the reach of ernment with any of the
key in a deal among 24 coun- ent. The two countries remain before Sundays parliamen- ulist movements from the na- anti-mainstream messages. other moderate parties, vot-
tries to cut almost 1.8 million at odds but have celebrated tary elections are a guide, tionalist right to the anticapi- Another factor is that glob- ers know. That means Ger-
barrels of oil a day this year. their dialogue. the crumbling of Europes talist left have become strong alization has reduced the abil- mans who truly dislike the
The visit, scheduled for Russia this year ended its old political order is affect- enough to aspire to power. ity of national governments chancellor have only the radi-
early October, is the latest criticism in the United Nations ing even Germany, the conti- Germany is unique. Its to manage some of the most cal AfD or the Left to turn to.
sign of a warming relationship of Saudi Arabias war against nents bastion of stability. booming economy barely felt potent electoral issues, from The AfDs challenge to Ger-
between the two largest Houthi rebels in Yemen. The Support for Germanys two the eurozones debt crisis. economic crises to migration. man postwar taboosit wants
crude-oil producers, who have Saudis saw that as a conces- major parties could fall below Unemployment is below 4%, Voters still expect solu- Germans to feel less guilt and
long been on opposite sides of sion that came after the king- 60% combined, while protest compared with around 9% tions from their government, more pride about the coun-
the Middle Easts geopolitical dom threw its weight behind parties of the far right and overall in the 19-country eu- but thats no longer always trys history, including the
fault lines. Russia counts cutting its oil production, far left could win 20% of the rozone. In an age of interna- possible, says Peter Filz- Third Reichis likely to
Saudi rivals Iran and Syria as Saudi officials said. vote between them, a pattern tional rage against incum- maier, political scientist at prompt much soul-searching
its closest Middle Eastern al- The diplomacy has high- of polls suggests. bents, around two-thirds of Austrias Danube University in Germanys establishment.
lies, while Saudi Arabia has lighted Russias balancing act Politics in Germany re- Germans say theyre satis- Krems. Other mainstream leaders
looked to the U.S. as an ally. in the Middle East between its main rather staid compared fied with Ms. Merkel. More The almost inexorable re- in Europes big year of elec-
Cooperation between these traditional partner Iran, gas- with many other European broadly, the countrys post- sult is that new parties cater tions have made more effort
vehement Cold War enemies producing Qataran economic countries. Victory for Chan- war political culture and in- to dissatisfied segments of than Ms. Merkel to style
used to be unthinkable. Not any- rival that it now courts as an cellor Angela Merkels con- stitutions strongly favor the electorateincluding pop- themselves as outsiders to
more, said Jim Krane, a fellow investorand Saudi Arabia. servative Christian Demo- moderate, mainstream par- ulist movements that attack the establishment, or to
specializing in Middle East en- The kings discussions on crats looks inevitable, even if ties over radicals. old elites and offer simple reach out to voters tempted
ergy and geopolitical issues at Qatar are likely to be closely they win fewer votes than Yet even in Germany, the fixes. Over time, more small by populism. The greater
Rice Universitys Baker Institute. watched. Saudi Arabia and its four years ago. The anti-im- grip of center-right Christian parties have won a place in flexibility of such leaders in
The thaw began last year as Arab allies have cut off diplo- migration Alternative for Democrats and center-left So- Germanys federal parliament. Germanys neighbors reflects
Saudi Arabia sought Russian matic and economic ties with Germany, which could win cial Democrats is weakening. The rise of Germanys po- the fact that they are under
support for the cut in oil pro- Qatar over what it says is the over 10% according to sur- The deepest reason for the litical fringes also reflects Ms. greater pressure from anties-
duction, which it hoped would emirates support for Iran and veys, remains smaller than fragmentation of Europes pol- Merkels weaknesses, how- tablishment insurgents.
reverse a historic downturn in the Muslim Brotherhood. its far-right peers in neigh- itics is that societies have be- ever. Her consensus-seeking A similar test could face
petroleum prices. Russia has taken a neutral boring France or Austria. come more complex. Old cen- style has erased policy differ- Ms. Merkels successors.
Though the OPEC-led pro- stance, calling for a diplomatic
duction cut has done little to resolution through talks.
raise oil prices, Russia and
Saudi Arabia have since talked
about establishing a joint en-
Georgi Kantchev and
Benoit Faucon in London
contributed to this article.
Hundreds Still Missing After Mexico Quake
BY ANTHONY HARRUP reports, according to Mexicos search for survivors. ready pulled out at least 52
AND ROBBIE WHELAN Navy undersecretary. We are Several Israeli engineers people from the rubble in the
certain that all of the children turned up at the site of the previous two days, including
MEXICO CITYRescue have unfortunately died, are collapsed primary school to two women stuck for 11 hours
workers, hampered by heavy in hospitals or safely at help figure out how to move in a collapsed apartment
rains, continued to search for home, said ngel Sarmiento. rubble. building in the trendy Roma
survivors early Thursday from Only one person could still Many of the teams brought district.
this weeks deadly earthquake be alive under the rubble of trained sniffer dogs. Guate- Mexico City officials said
that killed at least 230 people, the school, thought to be a malas team brought Drago, a 38 buildings collapsed, most
a toll that seemed sure to rise woman who works there, Mr. rescue dog made famous for of them multistory apartment
amid reports of nearly as Sarmiento added. He said 25 finding a missing woman on a or office buildings.
many people missing. people died at the school, volcano. More than 200 people were
Overnight, the body of a most of them children. Thermal sensors are good missing and believed to be
58-year-old teacher was re- An estimated 1,800 people to detect survivors beneath trapped, according to broad-
moved from the collapsed re- in central Mexico were in- the rubble, but nothing beats caster Televisa.
mains of the Enrique Reb- jured, federal officials said. the sense of smell of a rescue Thousands of citizens, co-
samen primary school in Help started coming in dog, said one Spanish officer ordinating largely through so-
southern Mexico City. from outside the country. Spe- who specializes in urban res- cial media, have rushed sup-
No children are trapped cialized disaster teams from cue operations. plies of food, water, medical
alive in the primary school, the U.S., Spain, Israel and Mexican rescuers, known and other supplies to places
contrary to widespread media Guatemala arrived to help the as Topos, or moles, had al- where they are most needed.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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A4 | Friday - Sunday, September 22 - 24, 2017 HK JP KO ML SI IN UK FR MN PR THE WALL STREET JOURNAL.

WORLD NEWS

U.S. Stance
On Iran Deal
Presses EU
European officials week they have no intention of
renegotiating the pact, in
dont want the accord which it agreed to signifi-
renegotiated but are cantly wind back its nuclear
activities in exchange for the
open to building on it suspension of most interna-
tional sanctions.
BY LAURENCE NORMAN To keep the deal alive,
Brussels may need to strike a
U.S. demands to reopen the balance between U.S. and Ira-
2015 Iranian nuclear agree- nian pressures, while main-
ment have placed European taining a united front among

EDUARDO MUNOZ/REUTERS
governments in the diplomatic the three European govern-
crosshairs, scrambling to heed ments that helped broker the
U.S. concerns without sparking accord. European officials say
an Iranian walkout from a deal they wont reopen it but are
they say is working. open to ways of building on
Trump administration offi- the agreement.
cials and their European allies The agreement is working
exchanged sharply differing and is delivering for its pur- EU foreign-policy chief Federica Mogherini says the Iran deal is working. Germany, France and the U.K. helped negotiate the accord.
views following a meeting pose, European Union for-
Wednesday night in New York eign-policy chief Federica if the U.S. withdraws from the Iran. In the past, European Even if the accord isnt re- gradually expand production
of foreign ministers from Iran Mogherini, who chairs the deal Tehran would decide companies have faced multi- opened, any supplementary of key nuclear materials.
and the six powers that nego- body that oversees compli- whether to restart banned nu- billion-dollar fines for breach- steps to hem in Irans future The Europeans have already
tiated the deal. That came af- ance, said Wednesday. We al- clear activities based in large ing U.S. sanctions on Tehran. nuclear activities could also be moved to tighten the deals
ter President Donald Trumps ready have one potential nu- part on how Europe responds. Ms. Mogherini now faces a opposed by Russia and China, implementation. French Presi-
assertion that he had decided clear crisis, she said in Europe could keep its own set of interlocking diplomatic which also helped negotiate dent Emmanuel Macron reiter-
whether to stick with itwhile reference to standoff over sanctions on Iran suspended. and technical challenges. the accord. Moscow and Bei- ated in a speech at the United
not revealing his decision. North Koreas program. Iran has different options. First, she must ensure that jing are building ever closer Nations this week the agree-
U.S. Secretary of State Rex Mr. Trump must decide by A big part of the equation is the U.K., France and Ger- economic and political ties ment could be filled out
Tillerson had already said mid-October whether to cer- related to what reaction the manythe European half of with Tehran. with international action to
Tuesday that Washington tify if the U.S. believes Iran is European Union will have to the six powersstick together. Ms. Mogherini will face contain Irans missile program.
would stand by the deal only if in compliance with the accord. this issue, Mr. Rouhani said. All three have said they want pressure to factor in U.S. con- The EU hasnt followed the
there were changes to it, in- If he says it isnt, Congress With many U.S. economic the U.S. to stand by the agree- cerns. The U.S. wants strict U.S. lead in imposing new
cluding addressing provisions would have 60 days to decide and banking ties to Iran still ment, but at a time that Brit- oversight of Irans compliance sanctions on those involved in
that allow Iran to expand its whether to reinstate sus- forbidden under U.S. law, the ain is exiting the EU and work- and has criticized the sunset missile tests.
nuclear activities from the pended U.S. sanctions. impact of renewed sanctions ing closely with Mr. Trumps clauses in the agreement that Farnaz Fassihi
middle of the next decade. Iranian President Hassan could fall most heavily on Eu- administration, that stance allow Tehran to step up re- and Rory Jones
Iranian officials said this Rouhani said Wednesday that ropean firms doing business in could be tested. search activities and then contributed to this article.

WORLD WATCH
S&P Cuts Iraq Moves to Retake ISIS Redoubt
Chinas BY BEN KESLING
AND GHASSAN ADNAN
province, some along the Syr-
ian border. The dual offensives
The town "now comes sec-
ond in significance only to
expected to begin an assault on
the town in early October, ac- FRANCE

Credit BAGHDADIraqs army

launched an offensive to drive
mark one of the final steps in
the campaign to oust Islamic
State from Iraq.
Raqqa in Syria, he said, refer-
ring to the groups de facto
capital in Syria, which is under
cording to an Iraqi official.
In Anbar province, mean-
while, Iraqi forces announced
National Front Loses
Chief Euroskeptic
Rating Islamic State from the town of
Hawija, one of the groups few
remaining strongholds in the
Hawija provides a strategic
position and a main source for
Daesh funding, counterterror-
assault from an array of Syr-
ian and Kurdish forces.
Mr. Abadi, announcing the
the retaking Thursday of their
first major objective, the town
of Ana. They will later push
The architect of Marine Le
Pens anti-euro stance, Florian
BY LINGLING WEI country and a hub it uses to ism forces spokesman Sabah start of the Hawija operation, toward the top prize in west- Philippot, quit the National Front.
threaten the oil-rich city Kir- al-Noman said, using an Ara- called it "a fulfillment to our ern Iraq, the border crossing Mr. Philippot, who champi-
BEIJINGS&P Global Rat- kuk and Iraqs semiautono- bic acronym for Islamic State. pledge to our people to liberate town of al-Qaim. oned the partys embrace of eco-
ings became the last of the mous Kurdish region. Hawija is used by the group all Iraqi lands and cleanse them The operations to retake nomic nationalism in this years
three major rating firms to The operation comes days as a center to build explosives from Daesh terrorist gangs. Hawija and towns in Anbar presidential election, said he had
lower its view on Chinas cred- after Prime Minister Haider al- including car bombs, and to Iraqi troops are pushing launched as the Kurdish re- left the party Thursday after
itworthiness, a move that Abadi announced the military launch attacks on surrounding through the outskirts of Hawija, gion in Iraqs north prepares Ms. Le Pen stripped him of his
came as Beijing has taken had begun clearing the mili- areas including Mosul. It is also which once had a population of to hold a controversial inde- role as vice president of strategy
measures to tamp down risks tants from areas that remain home to four Islamic State over 400,000 people but is now pendence referendum on Mon- and communications.
and emphasize stability. under their control in Anbar training camps, Mr. Noman said. home to just 45,000. Troops are day. The Iraqi government, I was told I was vice presi-
The timing of the move, United Nations and U.S., along dent of nothing. I dont like be-
just weeks ahead of a Commu- with most of the international ing ridiculed, nor do I like having
nist Party leadership transi- community, have opposed the nothing to do, so you bet I quit
tion, was likely to be an irri- votes timing in large part be- the party, he said on French
tant for Beijing and raised cause it coincides with the fi- television. Stacy Meichtry
eyebrows among some econo- nal stages of the battle against
mists and investors. Islamic State. JAPAN
In a statement Thursday, The district of Hawija makes
S&P said the downgrade, to A- up some 30% of Kirkuk prov- Central Bank Stands
plus from AA-minus, reflected ince, according to Iraqi offi- Fast on Easy Money
its assessment that a pro- cials. Though Kirkuk falls under
longed period of strong credit the control of Mr. Abadis Bagh- The Bank of Japan stuck by
AHMAD AL-RUBAYE/AGENCE FRANCE-PRESSE/GETTY IMAGES

growth has increased Chinas dad government, Kurds claim its ultraeasy monetary policy
economic and financial risks. the land should be part of their even as the U.S. Federal Reserve
The rating and the view of semiautonomous region. and other major central banks
risks in China now match Kirkuks city and provincial indicate that their withdrawal of
those of Moodys Investors leadership is Kurdish, and the stimulus is imminent.
Service, which lowered city is largely protected by the BOJ Gov. Haruhiko Kuroda
Chinas rating in May, and Kurdish military forces known told a news conference that any
Fitch Ratings, which did so in as the Peshmerga. potential interest-rate increases
2013. The area, riven with ethnic in the U.S. dont mean that rates
The S&P conclusion isnt divisions, has become a potential need to be raised in Japan too,
exactly head-slapping news to flashpoint for unrest as plans for because they should be deter-
the market or Chinese regula- the referendum move forward. mined by the economic and
tors, said David Loevinger, a Kurdish leaders have said price conditions in each country.
managing director at fund they are willing to consider call- Despite the best stretch of
manager TCW in Los Angeles. ing off the referendum at this economic growth in more than a
Its a bit ironic given that Smoke billows as Iraqi forces advance toward al-Sharqat ahead of an expected assault on Hawija. time if given certain concessions. decade, inflation in Japan re-
Chinas fundamentals are the mains weak, having picked up
strongest theyve been in two only a little speed. In July,
years, Mr. Loevinger said.
Chinas economy expanded
6.9% in the first half of the
year, well above Beijings 2017
KOREA the North Korean nuclear tests
to be unacceptable and sug-
gested that they were beyond
the scale of Hiroshima.
ment with South Korea, from
which he has threatened to
withdraw, but said that it mat-
tered less than the two coun-
the United States and so good
for South Koreawere going
to try to straighten it out and
make it fair for everybody. But
Japans core inflation accelerated
to 0.5%, far from the BOJs tar-
get of 2%.
I believe the current frame-
growth target, though recent Continued from Page One Referring to Mr. Trump as tries shared security interests. our real focus will be on the work is sufficient for reaching
data indicate that higher bor- counts for more than 90% of Donald, Mr. Abe praised his We are on a very friendly military and our relationship the 2% target, Mr. Kuroda said.
rowing costs are starting to Pyongyangs trade. leadership and described the basis working on trade, were with South Korea, which is ex- Megumi Fujikawa
have an effect on business ac- China, their central bank meeting as significant. working on a trade agreement. cellent, he said.
tivity. has told their other banksto Treasury Secretary Steven But much more important, The U.S. pushed a resolu- PHILIPPINES
An S&P spokesman declined immediately stop doing busi- Mnuchin planned to brief re- frankly, than trade is the other tion last week that resulted in
to comment on questions ness with North Korea, Mr. porters Thursday afternoon, aspect of our relation- the Security Council agreeing Protesters Denounce
about the timing of the rating Trump said. along with United Nations Am- shipNorth Korea, Mr. to sanction 90% of North Ko- Dutertes Policies
firms action. The presidential order out- bassador Nikki Haley. Trump said. reas annual revenue and re-
In a bid to keep the econ- lines a broad list of North Ko- Mr. Trump also twice men- Because of the fact that duce the countrys oil imports Thousands of antigovernment
omy on an even keel ahead of rean targets, including goods, tioned the U.S. trade agree- our trade deal is so bad for by 30%. protesters thronged Manila on
the power transition, Beijing services and technology, Mr. Thursday in the largest outpour-
has moved aggressively to rein Trump said. Our new execu- ing of opposition against Presi-
in rampant borrowing this tive order will cut off sources Seoul Approves Aid, phasized a two-track approach food, not in cash, there was vir- dent Rodrigo Dutertes deadly
year. of revenue that fund North Ko- toward North Korea, supporting tually no possibility that it war on drugs and strongman
However, S&P raises a valid reas efforts to develop the Despite Standoff tougher sanctions in response to would be diverted for other style of governance.
concern about Chinas credit deadliest weapons known to Pyongyangs weapons tests while purposes, the ministry said. The protests, planned to coin-
continuing to expand faster humankind, he said. opposing military action and leav- Despite the Norths advanc- cide with the 45th anniversary
than output, economists and The U.S. seeks the com- SEOULSouth Koreas gov- ing the door open to peace talks. ing weapons tests, Seoul has of the declaration of martial law
analysts say. That reflects plete denuclearization of ernment said it would send $8 Seoul plans to provide $3.5 said it would maintain humani- by former dictator Ferdinand
more loans going into sup- North Korea, Mr. Trump said. million in new humanitarian aid million in vaccines and medical tarian assistance regardless of Marcos, extend weeks of back-
porting unprofitable firms as It is unacceptable that oth- to North Korea, despite the nu- aid through Unicef and $4.5 political situations. lash against the Duterte admin-
opposed to more productive ers financially support this clear standoff on the peninsula. million in food through the U.N. That approach has istration after the alleged police
areas. criminal, rogue regime, Mr. The left-leaning administra- World Food Program for mal- prompted criticism from U.S. killing of a teenager last month.
Chinese officials have main- Trump told President Moon tion approved the new aid nourished children and preg- President Donald Trump, who Human lives are indispens-
tained that Beijing has the Jae-in of South Korea and tranche Thursday, after a meet- nant women, the unification this month suggested South able. One death is too many,
ability to control its debt Prime Minister Shinzo Abe of ing of government officials ministry said, with the timing Korea was seeking appease- said Robbie Solis, a 32-year-old
growth and prevent systemic Japan, who were both there chaired by unification minister and size of aid deliveries to be ment with the North. The U.S. who lives in Manila and joined a
risks. with delegations. Cho Myoung-gyon. determined later. Embassy in Seoul didnt com- protest. Even if theres a high
The Ministry of Finance Mr. Abe replied, in remarks Since taking office in May, Since the aid would be pro- ment on the aid decision. chance that the person is a
didnt respond to requests for that were translated into Eng- President Moon Jae-in has em- vided as medical products and Min Sun Lee criminal, people still have rights.
comment late Thursday. lish, that he had considered Jake Maxwell Watts
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THE WALL STREET JOURNAL. Friday - Sunday, September 22 - 24, 2017 | A5

U.S. NEWS
Opponents of GOP Repeal Effort Dig In
Critics step up attacks ferring to the other sponsors
of the bill.
on latest health bill The attacks seek to hit the
amid narrow window bills sponsors in areas of po-
litical vulnerability.
for Senate vote Save My Care, a health-
care advocacy group, has
BY STEPHANIE ARMOUR launched ad campaigns in Ne-
vada, Alaska, West Virginia,
Opponents of a Republican Maine, Tennessee and Ari-
plan to dismantle most of the zona. An ad this week targets
Affordable Care Act are scram- Sen. Dean Heller (R., Nev.) for
bling to ramp up a resistance co-sponsoring a bill that lets
campaign before a possible states waive ACA protections
Senate vote next week on a bill for people with pre-existing
many never expected would conditions.
gain traction. Were pulling out all the
With such a narrow win- stops. Were putting out a lot
dow, consumer and other of phone calls, said Brad
groups are seeking to pressure Woodhouse, campaign director
specific GOP senators they see at Protect Our Care, an advo-
as most likely to waver. They cacy group focused on block-
also assert that Republicans ing the repeal.

MICHAEL REYNOLDS/EPA/SHUTTERSTOCK
are trying to ram through a The proposal would let
bill outside the normal process states get waivers to end the
while reneging on a promise to ACA prohibition on insurers
preserve the ACAs consumer charging higher premiums to
protections, claims the bills people with pre-existing health
sponsors reject. conditions. That was the situa-
Timing is clearly a chal- tion before the ACA estab-
lenge for the bills supporters, lished the restriction.
who must cobble together A few months ago, Mr.
votes by a Sept. 30 deadline, Cassidy spoke out in favor of
when a parliamentary vehicle GOP Sen. Lindsey Graham of South Carolina and former Sen. Rick Santorum, a Republican, in Washington on Wednesday. protections for people with
that enables the Senate to pass pre-existing conditions. Mr.
legislation with a simple ma- much time for the bills oppo- Levitt, a senior vice president the ACA. They say it protects hearings early next week on Cassidy has said the bill would
jority expires. Senate Majority nents, who had weeks to build at the Kaiser Family Founda- people with pre-existing condi- the legislation. protect these consumers be-
Leader Mitch McConnell (R., up resistance to previous ACA- tion. Interest groups dont tions and returns control over Under Graham-Cassidy- cause it stipulates that cover-
Ky.) has said he plans to hold a repeal attempts, including leg- have a lot of time to mobilize health care to the states. They Heller-Johnson, more people age must be affordable.
vote next week, by Sens. Lind- islation that failed in July to and figure out what it means. disagree with critics who say will have coverage and we Critics say that definition is
sey Graham of South Carolina pass the Senate. Republican leaders have be- they have been secretive with protect those with pre-exist- so vague that rates for sick
and Bill Cassidy of Louisiana. This bill is complicated gun responding to the attacks the bills process, pointing out ing conditions, Mr. Cassidy people still could become pro-
But it also doesnt leave and far-reaching, said Larry on their bill to topple much of that theyre holding public said Wednesday on CNN, re- hibitively expensive.

White House Ties Puerto Rico Assesses Storm Damage

To Flynn in Focus SAN JUAN, Puerto Rico
Puerto Rico is emerging crip-
pled after the most powerful
hurricane to hit the U.S. terri-
Special Counsel Robert the May firing of Mr. Comey,
Mueller is seeking to deter- provides a window into Mr. By Jos de Crdoba,
mine what White House offi- Muellers investigation, the Arian Campo-Flores

HECTOR RETAMAL/AGENCE FRANCE-PRESSE/GETTY IMAGES

cials knew about a federal in- people said. Mr. Muellers and Joseph De Avila
vestigation into former probe has taken aim at two of
national security adviser Mi- Mr. Trumps top advisers dur- tory in almost a century hob-
chael Flynn early this year. ing the 2016 campaign: Mr. bled its telecommunications
Flynn and former Trump cam- system, destroyed its power
By Aruna Viswanatha, paign chairman Paul Manafort. grid and left communities
Rebecca Ballhaus The special counsels office flooded.
and Del Quentin Wilber is exploring whether Mr. Puerto Rican authorities
Manafort engaged in potential warned the islands 3.4 million
The move comes as Mr. violations of lobbying and residents of a long, difficult
Muellers team examines money-laundering laws, ac- path to recovery from Hurri-
whether President Donald cording to people familiar cane Maria. Abner Gmez, ex-
Trump or other administration with the matter. Mr. Manafort ecutive director of the islands
officials sought to obstruct has said he did nothing wrong. emergency-management
that probe, according to peo- The investigation also fo- agency, said residents should
ple familiar with the matter. cuses on alleged Russian inter- be prepared to sustain them- Hurricane Maria hobbled the islands telecommunications system and destroyed its power grid.
As part of that effort, Mr. ference in the 2016 presiden- selves without aid for 72
Muellers prosecutors have in- tial campaign and whether the hours, given the severity of flow in, as well as to restore Many areas confronted his- Juan.
dicated they would like to in- Trump campaign colluded with the damage, the obstacles to telecommunications. I havent toric flooding that stranded Puerto Rico was absolutely
terview key White House offi- Moscow. Russia has denied in- reach people and how thinly been able to communicate residents. Gov. Rossell joined obliterated, President Donald
cials and have requested a terfering, and Mr. Trump has stretched government re- with my parents, he said National Guard troops early Trump said Thursday. Their
trove of documents on a range denied any collusion. sources are. More than 95% of Puerto Thursday that were conduct- electrical grid is destroyed. It
of topics, including Mr. Flynn Mr. Muellers document re- Its a crisis, said Gov. Ri- Ricos wireless cell sites are ing rescue operations in Levit- wasnt in good shape to start
and a warning from a Justice quest came last month, ac- cardo Rossell in a news con- currently out of service, the town, a suburb of San Juan, off with. But their electrical
Department official about his cording to one of the people. A ference aired at the only radio Federal Communications Com- according to a spokeswoman grid is totally destroyed.
interactions with a Russian spokesman for the special station that can still be broad- mission said Thursday. Thats for the governor. FCC Chairman Ajit Pai said
diplomat, the people said. counsel declined to comment. cast across the entire island. worse than immediately fol- Gov. Rossell said authori- the agency is reaching out to
Mr. Flynn was forced to re- The White House does not He said the governments main lowing Hurricane Irma, which ties have rescued 500 people telecom providers to look for
sign on Feb. 13, just a few comment on any specific re- goals are to open seaports and knocked out 56% of the is- in the flooded town of Toa ways to help get the communi-
weeks into Mr. Trumps presi- quests being made or our con- airports so aid shipments can lands wireless networks. Baja, 26 miles west of San cations networks back online.
dency, for giving misleading versations with the special
statements about his contacts counsel, said Ty Cobb, the
with Russian officials to Vice
President Mike Pence.
The day after Mr. Flynns res-
ignation, Mr. Trump met with
White House special counsel,
in an interview. The White
House is fully committed to
cooperating with Mr. Muel-
Poll: Presidents Outreach Effort Pays Off
then-Federal Bureau of Investi- lers probe, he said. BY JANET HOOK News poll has found. Meanwhile, the GOP presi- GOP, compared with the partys
gation Director James Comey in White House aides were or- The poll found 71% of adults dents job approval rating congressional leaders.
the Oval Office. Mr. Comey later dered earlier this year to be- President Donald Trumps in the U.S. approved and 8% edged up for the first time Nearly six in ten registered
testified before Congress he be- gin preserving documents that deal with congressional Dem- disapproved of Mr. Trump by- since the spring, rising 3 per- Republicans are dissatisfied
lieved Mr. Trump was asking Mr. Mueller might re- ocrats to keep the govern- passing GOP leaders to strike a centage points to 43%. That is with the work of Senate Major-
him to back off an investigation quest. Aides werent surprised ment funded and provide hur- short-term spending deal with still the lowest mark for mod- ity Leader Mitch McConnell (R.,
into Mr. Flynn when Mr. Trump by the special counsels latest ricane relief is drawing Congresss Democratic leaders, ern presidents at this point in Ky.) and House Speaker Paul
allegedly asked the director if request, a White House official strong support from across Sen. Chuck Schumer of New their first term. Ryan (R., Wis.) to achieve the
he could see his way to letting said. It was earlier reported by the political spectrum, a new York and Rep. Nancy Pelosi of Still, Mr. Trump is in a partys legislative priorities.
Flynn go. the New York Times. Wall Street Journal/NBC California. stronger position within the Messrs. McConnell and Ryan
Mr. Mueller is investigating People close to the presi- are facing the highest levels of
whether Mr. Trumps actions dents legal team described unpopularity since they be-
amounted to obstruction of the requests as within Mr. For Trump, Bipartisanship Wins Applause came national figures: 41% have
justice. Mr. Trump has denied Muellers mandate as a special President Trump's job-approval rating has ticked up amid high support of his agreement with Democrats a negative view of Mr. McCon-
any wrongdoing. counsel. Exploring the presi- to fund the government and provide hurricane aid. Opinion of other Trump actions is lower. nell, including 25% of Republi-
Mr. Muellers request, dents history of business cans. Overall, 40% view Mr.
which includes a dozen other dealings, they said, would fall ON PRESIDENT TRUMP Ryan unfavorably, including
topics of interest, including outside that mandate. Do you approve of Mr. Trumps Do you approve of Mr. Trumps handling of these issues? 21% of Republicans.
job performance? Working with Democrats to Bill McInturff, the GOP poll-
keep government open and Disapprove Approve ster who conducted the survey
75% with Democratic pollster Fred
Household Net Worth Rises Disapprove
fund hurricane relief
The economy
8%
36
71%
41 Yang, said those findings illus-
trate the toll on GOP leaders of
52% Border security, immigration 47 39
BY ERIC MORATH business and consumer confi- a president who has blamed
50 North Korea 43 36
dence and broad economic them publicly for failing to de-
The total net worth of U.S. growth around the globe. Health care 53 27 liver on key legislative promises.
households pushed further into The value of real estate rose Pardon of Joe Arpaio 42 25 Mrs. Pelosi engenders an
record territory, climbing by by $564 billion last quarter, a Approve 43% even higher level of negative
25 Twitter use 66 23
$1.7 trillion in the second quar- better gain than the prior quar- feelings than either GOP leader,
ter of 2017, to $96.2 trillion. ter, showing that home prices F M A M J J A S Events in Charlottesville, Va. 55 20 but she retains more support
The increase reflected rising are rising at time when demand within her party than Messrs.
values of stocks and homes, for housing is high and unem- ON TAXES McConnell and Ryan do in
but the gain was smaller than ployment is low. The sum Amer- To fund the government, how would you tax... Do businesses pay their theirs. Some 43% view Mrs.
the $2.3 trillion advance in the icans held in savings accounts fair share in taxes? Pelosi in an unfavorable light,
first quarter, according to the and in bonds fell slightly in the Increase Keep the same Decrease including 17% of Democrats.
More About Less
data the Federal Reserve re- quarter. Overall assets rose by ...the wealthy? 62% 24% 12 % than right than The presidents approval
leased Thursday. 1.8 trillion last quarter. That was 20% 34% 37% rating had been stuck around
...corporations? 55 25 16
Household wealth in the partly offset by a $146 billion 40% for months, and much of
stock market climbed by $1.1 increase in household debt. ...you/your family? 7 53 40 Do you think you pay your the 3-percentage-point increase
trillion in the second quarter. The figures are from a fair share in taxes? since an August poll comes
...the middle class? 4 48 47
While a slightly smaller in- quarterly Fed report, known as More About Less from improved standing among
crease than in the first quarter, the Flow of Funds, which ..small businesses? 4 37 57 than right than voters unaffiliated with any
the improvement still reflected tracks the aggregate wealth of 40 55 4 party: 41% now approve of the
Note: Not sure/dont know answers not charted
a steady upward trend in equi- all U.S. households and non- Source: WSJ/NBC News telephone polls, most recent of 900 adults job he is doing, up from 32% in
ties prices supported by solid profit organizations. conducted Sept. 1418; margin of error: +/3.27 pct. pts. THE WALL STREET JOURNAL. August.
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
A6 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

IN DEPTH

ALDI An Aldi store in Greenville,

N.C., this summer featured a
private brand of diet soda in
boxes of 12 for $2.25 and a
Continued from Page One cup of Greek yogurt for 69
zon.com Inc. acquired Whole cents. In the parking lot,
Foods Market Inc. this summer Latonya Edwards, 44, a nurse,
and Google struck a partner- said she comes to Aldi to stock
ship with Wal-Mart. But the up on staples for her pantry
Germans have a plan, forged in such as canned goods, a signa-
the rubble of World War II. ture of the brand since the Al-
The strategy is simple, brecht brothers entered busi-
said Aldi spokesman Florian ness after the war. You have
Scholbeck, sitting in the dark- to know how to shop, said
ened break room of a proto- Ms. Edwards, who was push-
type store in the companys ing a full cart toward her car.
home state. But its not easy. Theo Albrecht of Aldi Nord
Even in Germany, not much approached cutting waste at
is known about how Aldi oper- the company with religious fer-
ates. It does little media adver- vor, according to Mr. Fedtke,
tising, doesnt publish financial who attended Catholic church
statements, and its top execu- with the brothers at St. Markus
tives dont give interviews. in Essen-Bredeney, a neighbor-
The Wall Street Journal fig- hood of industrialist estates.

DANIEL ACKER/BLOOMBERG NEWS

ured out Aldis idiosyncratic The younger Mr. Albrecht
playbook through internal docu- asked employees to turn the
ments, the companys rare pub- lights off when the sun was out,
lic filings, and interviews with took notes on scrap paper and
past and present managers. asked store managers to set
It offers a deliberately bathroom hand dryers not to
pared-down selection, some- blow for one second too long.
times a tiny fraction of the Former executives say he
number of items sold by rivals, saw every cent of waste in a
which helps Aldi cut costs to An Aldi supermarket in Chicago. Aldis increased focus on the U.S. comes amid upheaval in the supermarket landscape. single store as an existential
levels U.S. grocers can only threat that, if multiplied
dream of. Among other bene- zern, a legal structure under as simple, as standardized and across his growing empire,
fits, fewer items means faster which a fleet of legally inde- as streamlined as possible, Growing Empire could put his fortune at risk.
turnover, smaller stores, less pendent companies swear loy- said Matthias Queck, an Aldi Expanding across Germany and beyond gave Aldi Sd and Aldi Nord One of Aldis strengths that
rent, lower energy costs and alty to each other while re- expert at the German grocery massive purchasing power, allowing them to negotiate some of the has eluded many discounters
fewer staff to stock the shelves. porting to a central board. consultancy LZ Retailytics. lowest prices in the grocery industry with suppliers. is its ability to draw middle-
That parsimony enabled Aldi to The arcane structure had Crucially, Aldi limits its stock class shoppers despite its lim-
establish itself in Europe and one crucial advantage: It of brand-name items, so it is When Aldi entered each market, by decade: ited array of goods. It did this
then launch into the U.S. meant the group never trig- often easier to negotiate low by cultivating the image of a
About 70 years ago, broth- gered financial reporting re- prices from its suppliers. Even 1960s 70s 80s 90s 2000s 10s company focused on quality
ers Karl and Theo Albrecht, quirements imposed on other Wal-Mart, famous for extract- rather than pinching pennies.
fresh from military service in businesses of its size. German ing concessions from its suppli- DENMARK Poor people need us, rich
World War II, took over their companies must publish earn- ers, can sometimes only go so IRELAND people love us, Theo Albrecht
familys store in Schonnebeck, ings reports if they check two far because premium con- used to tell executives, accord-
U.K.
a mining neighborhood of the out of three boxes: more than sumer-goods companies have to NETH. POLAND ing to Mr. Brandes, the former
bombed-out industrial city of 65 million in assets, over bear costs such as advertising. GERMANY board member.
BELG.
Essen. In the early 1950s, they 130 million in annual sales, On a basket of 30 typical LUX. There too, executives say,
began rolling out their ascetic or more than 5,000 employees. household items, Aldis prices the limited assortment played a
concept to other branches Broken up into small parts, are on average almost 17% FRANCE AUSTRIA HUNGARY central role. The small number
SWITZ.
throughout the region. Aldis armada of companies lower than Wal-Marts, accord- of items ensured staff could
Back then, their stores of- didnt cross these thresholds. ing to research conducted by ITALY* SLOVENIA carefully choose, taste-test and
fered just 250 items, the ba- Under their cloak of secrecy, Mr. Johnson of Customer quality-control each item.
sics miners and steelworkers the brothers could hide their Growth Partners. PORT. The ground floor of Aldi
families needed to survive colossal and rapidly rising Its a system of 1,000 de- Sds headquarters in Mlheim
flour, sugar, coffee, butter, ba- sales volume from competitors. tails all made against the GREECE has a test kitchen where every
con, peas and condensed milk. After the split, the twin dy- backdrop of costs, said Dieter day from 8:30 a.m. to 2:30
In the 1950s and 60s, Ger- nasties continued to keep their Brandes, who sat on Aldi p.m. the companys executives
manys economic miracle took selection in check, pool mar- Nords board of directors with and buyers sample food sold in
off, and a wave of glitzy super- ket intelligence and avoid di- Theo Albrecht until 1985. No- its stores and conduct blind
markets selling thousands of rect competition. body needs 50 different types N.H. tastings to see if it beats the
Vt.
items sprouted up to serve the By then, Aldi Sd was sell- of toilet paper, he said. Minn. competition. One test involves
newly affluent middle class. ing 400 items per store in its With its limited assortment, sampling spoonfuls of olive oil.
S.D. Wis. N.Y. Mass.
Aldi didnt flinch. Southern German fief, its in- Aldis biggest problem, accord- Mich. Mr. Scholbeck, who became
In his only known public re- ventories arranged on wooden ing to Eberhard Fedtke, who Neb. Iowa Pa. Aldi Nords first ever communi-
marks on Aldis business model, pallets on the floor. In the managed Aldi Nord stores in Ohio cation director this year, said a
Ill. Ind.
Karl Albrecht said in a 1952 the flagship region in Essen in W.Va. 4.99 bottle of Spanish Gren-
Calif. Kan. Mo. Ky. Va.
speech that the brothers had the 1970s, was where to get N.C. ache red wine recently on sale
once toyed with the idea of fol- enough stock, and where to put Tenn. R.I. in the companys German stores
Okla.
lowing the supermarket trend.
Aldi is gambling on all the cash we were making.
Ark. S.C.
Conn. scored 93 out of 100 points on
Miss. Ala. Ga.
In the end, they decided to small stores instead of His region of around 40 Aldi Texas
N.J. the American wine expert Rob-
keep their limited selection af- stores rang up sales of about Del. ert Parkers rating system, mak-
ter realizing it gave them an
warehouses that take 1.2 million deutsche marks, or Fla.
Md.
ing it an outstanding wine of
D.C.
edge: We had much lower ex- longer to navigate. roughly $3 million at the time, exceptional complexity.
penses, Mr. Albrecht said. every day. His stores sold out You should see what kind
By keeping costs low, the of goods so quickly, in about *Expansion in progress, not yet opened. entered, then left, in 2010 of cars were out there! he
Spartan assortment allowed eight days, that he would order Note: Stores in Australia since 2001; e-commerce sales in China said. The Porsche drivers
the founders to sell their in- north, Aldi Nords markets inventory twice in the time it since 2017 through Alibaba shopping portal. were buying 6-packs. Because
ventory for less and turn it were selling about 450. Today, took suppliers to bill him once. Source: the company THE WALL STREET JOURNAL. the quality is on point.
over at lightning speed, boost- the brothers are deceased and While becoming the first to After the introduction of
ing profit margins, according power lies with the empires scale the hard-discount model mium discounter. man hard-discount model in the the euro fueled rising prices,
to former executives. collective leadership. But Aldi in Germany, Theo Albrecht of Other American brands also U.S. comes at a time when the discounter asserted itself
Speed wins, speed kills, has stayed true to the concept. Aldi Nord found a kindred developed a concept based on shoppers are, more than ever, as a mainstay in the vast ma-
said Craig Johnson, president Most Aldi stores stock be- spirit in the U.S., buying the curbing selection, including seeing the appeal in a small for- jority of German households,
of the Connecticut-based retail tween 1,300 and 1,600 items, California-based franchise Costco Wholesale Corp., which mat, quick-trip-type store that according to analysts.
consultancy Customer Growth depending on the country. Trader Joes in 1979 from its these days limits its stock in offers low prices and high qual- A Forsa Institute poll in
Partners. By comparison, Wal-Marts founder, Joe Coulombe. U.S. stores to 3,800 items to ity, said Mike Paglia, director 2002 found that 95% of blue-
In 1961, the brothers di- Supercenters have in recent Trader Joes had concocted boost turnover speed. of retail insights at the Kantar collar workers and 88% of
vided their growing empire years carried around 120,000 a similar model based on lim- Aldi is gambling it is more Retail consultancy in America. white-collar workers in Ger-
into two kingdoms, Aldi Nord items. Average supermarkets in ited selection, keeping inven- in tune with the American The typical 40,000 square- many shopped at Aldi.
and Aldi Sd (the shared name the countries where Aldi oper- tory back then to 1,100 items. tastes, rolling out small, nim- foot supermarket is a dino- Aldi is like a lighthouse,
came from a contraction of the ates now carry between 20,000 In Mr. Albrechts obituary, the ble stores instead of sprawling saur, and its extinct, said Phil said Michael Lohse, spokesman
words Albrecht and dis- and 50,000 items, experts say. only comments from the fam- warehouses and supermarkets Lempert, an American grocery for Germanys Farmers Associ-
count). They organized each Aldi has always been fo- ily on the acquisition, Trader that take longer to navigate. retail expert. Those stores ation. If its prices move, other
part as a Gleichordnungskon- cused on making everything Joes is described as a pre- The expansion of the Ger- need to die. retailers have to follow them.

TRIX most of his lunches from the

7-Eleven across the street
from his office while his co-
worker eats weird vegetable
trendy, natural and organic
food, and is not embarrassed
about it. Hes never tried kale
chips because Pringles are
as maltodextrin and Blue 2
Lake, have withstood the
health trends. Kellogg says
they are two of the companys
also have cited health reasons
for wanting to steer clear of
artificial dyes in particular.
That didnt stop an out-
cereal, because the look, flavor
and smell are nostalgic. The
experience is also liberating,
she says, because her mom
Continued from Page One chips from Trader Joes and just too good. best-selling brands. pouring of nostalgia when the wouldnt let her eat sugary ce-
She said in an interview puffed kale. Mr. Fauria has tried and When Hostess products re- company announced its new real as a child.
Thursday she likes the way the Food giants have long failed to find Apple Jacks in turned to shelves in 2013 after formula. We either had granola in a
artificial colors and high-fruc- sought to shed additives to Sprouts and Whole Foods being out of production for On Twitter after the death box with people backpacking
tose corn syrup look and taste. appease consumers desire for stores. Its an atrocity, he eight months following the of Classic Trix, people posted on a mountain on the cover, or
The new recipenot so much. simple, natural ingredients. said. Once, he ended up with companys bankruptcy, retail- messages such as, I genuinely an all-natural amaranth flake,
My kids find the color of the Kellogg Co. also said two years Bear Naked cereal, which he ers placed orders for 50 mil- feel bad for the kids that Ms. Guarnaschelli said.
new Trix cereal quite depress- ago it would remove artificial said gets too soggy in the lion Twinkies and nearly 40 never got to experience the Kraft Heinz Co. tried a dif-
ing, she said. dyes from Froot Loops cereal milk. Apple Jacks hold up million Hostess CupCakes in old Trix cereal, and My ferent tack when it quietly re-
So change it back is what and Nutri-Grain bars by the better. (That could be the ar- the first two weeks. childhood fading away with moved artificial yellow dye
the company did. General end of 2018. It hasnt released tificial additives. Kellogg Food giants like General the colors of Trix cereal. from its boxed macaroni and
Mills has decided to reintro- the new versions yet, a makes both Apple Jacks and Mills thought switching to Rabobank food industry an- cheese in 2015. Its signature
duce the original, more-vi- spokeswoman said. Bear Naked.) simpler ingredients would alyst Nicholas Fereday said the yellow color was easier to rep-
brant Trix, artificial flavorings Americans love affair with Other products including help revive lackluster sales of revival of Classic Trix could be licate, so after months of sell-
and all, and will start selling it processed foods is enduring, Pringles and Pop-Tarts, which goods such as cereal and called Trix Shameless. ing the new recipe, most con-
on supermarket shelves along- however, despite a decade of are made with additives such canned soup. Some consumers Part of the problem for Trix sumers didnt notice a
side the more wholesome ver- finger-wagging from nutri- was that General Mills food difference, the company said.
sion in October. tionists, influential celebrities scientists said they couldnt It then began an ad campaign
The reintroduction of Clas- and trendy grocery chains replicate the vibrant red and with the slogan Its changed.
sic Trix is a reversal of Gen- such as Whole Foods peddling neon blue-green corn puffs But it hasnt.
eral Mills pledge two years healthy and sometimes ob- with fruit and vegetable juices. General Mills said it isnt
ago to remove artificial colors scure ingredients to the Besides producing a bland planning to bring back artifi-
and flavors from all its cereal masses. color, the juices and extracts cially colored Fruity Cheerios
brands. It said the seven re- Sales of products without gave the cereal a different or other cereals it replaced
formulated, all-natural cere- artificial colors or flavors are taste. with natural ingredients, be-
als boosted sales by 6% in rising faster than overall food Trix has long marketed it- cause it hasnt received as
early 2016. and beverage sales, according self as a cereal for kids. Its many complaints about those.
At the same time, natural- to Nielsen and Label Insight. commercials have featured its The company is delaying
ingredient haters flooded the But more than 25,000 prod- floppy-eared mascot, the Trix swapping some of its other
company with calls, emails ucts in the U.S. still contain Rabbit, repeatedly getting re- iconic, playful cereal brands
and social-media posts, ac- high fructose corn syrup, some buffed in his efforts to wrest with all-natural versions until
RICHARD B. LEVINE/ZUMA PRESS

cording to Mike Siemienas, a 46,000 are made with artificial the cereal from children. They it can get the new recipes
spokesman. colors and 63,000 have artifi- end with the slogan, Silly right.
It turns out consumers cial flavors. Rabbit, Trix are for kids. Food scientists are still
dont all want one thing, he Philip Fauria, a 30-year-old Alex Guarnaschelli, a chef working on removing the syn-
said. optometrist who recently ate on the Food Networks Iron thetic dyes in its Lucky
Its basically a salad Reeses Puffs cereal for break- Chef and Chopped reality tele- Charms, Mr. Siemienas, the
now, said 35-year-old Justin fast and Pringles with an Os- vision shows, said she occa- spokesman, said, because
Storer of the new Trix. The car Mayer turkey sandwich for sionally enjoys childhood fa- those marshmallow bits are a
Chicago lawyer said he gets lunch, said hes not a fan of Boxes of General Mills cereal displayed on supermarket shelves. vorites, such as Fruity Pebbles big challenge.
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. Friday - Sunday, September 22 - 24, 2017 | A7

BOOKS
A revolution is not a dinner party. Mao Zedong

Through a Glass, Darkly

In 1949, Truman and U.S. policy makers struggled to foresee the consequences of the Chinese revolution
ground in terms of argumentation
A Force So Swift or analysis.
By Kevin Peraino The value lies primarily in Mr.
Crown, 379 pages, 20.90 Perainos ability to tell an interest-
ing story well, to illuminate the per-
BY HAL BRANDS sonalities of the key actorsChiang
and Mao, Truman and Acheson, and
othersand to capture the travails
ONE OF THE MOST daunting chal- inherent in coming to grips with a
lenges of statecraft is how to fashion revolution in progress. The inti-
coherent policy in the midst of a rev- mate, blow-by-blow reconstruction
olution. Foreign policy frequently of the story offers a vivid sense of
rests on established diplomatic rela- what it must have been like for
tionships and ingrained assumptions; American policy makers as they
revolutions sweep such verities grappled not just with the rapidly
away, creating geopolitical turmoil in deteriorating situation in China but
the present and intellectual uncer- with the political pressures, bureau-
tainty about the future. cratic disputes and personality
For more than two centuries clashes that made their labors all
particularly since the U.S. became a the more trying.
global powerAmerican leaders That said, A Force So Swift is
have frequently been forced to con- unsatisfying in some key respects.
front the dilemmas presented by Mr. Perainos focus on the events of
revolutions in countries of strategic 1949 is a good device for keeping
importance. The uncertain and con- the narrative moving and covering
tradictory nature of the Carter ad- the climax of Chinas revolution.
ministrations policy toward the col- Yet it means that crucial parts of
lapsing regime of the shah of Iran the story get less attention than
in 1979, the indecisive character of they deserve.

GETTY IMAGES
the Obama administrations re- Many of the key developments in
sponse to the Arab Spring in 2011, both the civil war and U.S. policy
and other such episodes testify to came in 1947-48, when Chiangs
the perpetually vexing nature of the RED TIDE Communists entering Beijing after the defeat of Chiang Kai-sheks Nationalists, 1949. forces suffered disastrous military
challenge. As Kevin Peraino reminds setbacks and the Truman adminis-
us in A Force So Swift: Mao, Tru- curred during the Truman years, But that initiative also offended with Mao (some excessively opti- tration deprioritized Chinawith
man, and the Birth of Modern and they were only complicated by Mao by holding out hope for a res- mistic State Department reporting obvious implications for Chiangin
China, 1949, much the same diffi- the myriad other dilemmas faced by toration of democratic individual- to the contrary), who was a devoted order to focus on Europe. These
culty confronted the Truman admin- U.S. global strategy in the early ism in China. Acheson and his chief Communist and deeply suspicious events are treated mostly as pro-
istration amid the culmination of Cold War. adviserssuch as Policy Planning of the U.S. Third forcesmove- logue in the book.
the Chinese revolution. The Truman administration had Staff director George Kennan ments that were both anti-Chiang Similarly, although Mr. Peraino
The year 1949 marked the final wrapped its call for the energetic hoped eventually to drive a wedge and anti-Maowere simply not describes the connections between
collapse of Chiang Kai-sheks Na- containment of an expansionist So- between the domineering Stalin and strong or cohesive enough to exert the Chinese civil war and U.S. do-
tionalist regime, a deeply flawed viet Union in inspiring, universalis- the equally headstrong Mao, but much influence. mestic politics, he curiously de-
government that the U.S. had, none- tic rhetoric, and yet Trumans advis- Washington simultaneously pursued clines to say much about the ties
theless, supported out of necessity ers understood that limited policiessuch as covertly support- between the Who Lost China? de-
for many years, and the rise of Mao resources compelled them to choose ing anticommunist elements in The origin story bate that followed Chiangs flight
Zedongs Communist dictatorship, carefully where America would ac- western Chinathat seemed more from the mainland and the rise of
which would eventually become one tually make a stand. American strat- likely to force the two Communist of Americas decades- McCarthyism.
of the bloodiest tyrannies ever to egists preferredcorrectlya Eu- powers together, at least in the long friction with Not least, one of the most sur-
plague the earth. Although no one in rope first approach to short term. prising outcomes of the Chinese rev-
a position of authority in Washing- containment, due to the enormous Finally, Achesons State Depart- Mao and its abiding olutionthat the U.S., which had
ton wished for Chiangs forces to be geopolitical significance of that con- ment favored allowing Mao to con- commitment to Taiwan. tried so hard to cut Chiang loose,
defeated by Mao, by 1949 the con- tinent, but it was in Asia where quer Taiwan, the island redoubt to ended up committed to preserving
sensus among American officials Communist movements were gain- which Chiang retreated, as a way of his regime on Taiwan as a result of
was that Chiangs regime was simply ing the most ground. fully disentangling Washington from The trouble, as Kennan aptly put it the Korean Waris treated almost
too corrupt and incompetent to be The administration had sought to the conflict; the Defense Department in 1948, was that there are operating as an afterthought. In reading this
saved. Meanwhile, Maos dictatorial build bipartisan support for contain- and Gen. Douglas MacArthur, by in China tremendous, deep-flowing, book, one sometimes gets the sense
tendencies were clear enough, but ment in the late 1940s, and yet the contrast, demanded that the island indigenous forces which are beyond that one is reading only part of a
his future geopolitical orientation loss of Chinawhether the result of be held as a critical bulwark against our power to control. Under the much longer and more fascinating
whether he would lean decisively American abandonment or Chiang communism in Asia. circumstances, the policy toward tale, and perhaps not the most im-
toward Stalins Soviet Union or take Kai-sheks own inadequacieswas Throughout 1949, U.S. strategy which the Truman administration portant part.
a more neutral course in the manner certain to ignite a political firestorm was more hesitant and contradictory stumbledavoiding a quixotic mili- Yet the fact that the narrative
of Yugoslavias Titoremained in Washington. In these circum- than coherent and purposeful, and tary intervention on behalf of Chiang, leaves the reader wanting more
murky, at least to those watching stances, and amid the cloud of un- by the end of that year the civil war shoring up the Southeast Asian pe- rather than less is the mark of a
anxiously in the West. certainty and confusion created by had concluded in precisely the sce- rimeter through military and eco- tale well told. And what Mr. Peraino
So how should the U.S. respond to the rapid progression of events in narioa Communist China seeking nomic assistance to neighboring does well in this book is to capture
the likely takeover of the worlds China, the Truman administration an alliance with Stalinthat Ameri- countries, and hoping that Commu- a critical moment in the founding
most populous country by a Commu- pursued a policy that was itself un- can officials had feared most. nist ideology would eventually tear of what is today the most impor-
nist movement at a time of intensi- certain and confused. In fairness, it isnt clear that Beijing and Moscow apart rather than tant bilateral relationship in the
fying Cold War between Washington The administration moved pro- there were many better options bind them togetherwas not such an world and to show the dynamics
and Moscow? Mr. Peraino recounts gressively toward a break with available to U.S. officials or that unreasonable course to follow. It re- that so often complicate the policy
the endgame of the Chinese civil war Chiang over the course of 1949, for bad policiesas opposed to rotten flected, as Mr. Peraino writes, a makers task at times of upheaval
over the 12 months beginning in De- instance, and yet it continued to circumstanceswere the root of dark, but coherent, worldview. and revolution.
cember 1948, as well as the resulting send military supplies to his regime. Americas problems in China. By Mr. Perainos book is a useful One imagines that U.S. officials
debates in Washington. As Maos Truman and his secretary of state, 1949 there was no possibility of guide to the final months of the civil will confront those dynamics many
and Chiangs forces battled each Dean Acheson, sought to distance saving Chiangs government absent war and the challenges that U.S. of- times again in the future. By way of
other in China, he writes, American themselves from the Nationalists a major military intervention that ficials confronted. The story he tells preparation, they could do far worse
policymakers battled fiercely with both to deflect blame for their col- would have consumed untold and will be largely familiar to those who than to read Kevin Perainos book.
one another as they struggled to lapse and to signal openness to a badly needed American resources have studied this period, for the
shape a response. relationship with the Communists with scant chance of success. Nor, bookdespite diligent research in Mr. Brands is a professor
Indeed, the disputes were as by publishing a white paper detailing in retrospect, was there ever much many of the relevant archives and of global affairs at Johns
fierce and profound as any that oc- the failings of Chiangs government. hope for a positive relationship sourcesbreaks relatively little new Hopkins University.

Lifestyles of the Rich and Tidy

in a timely fashion wake up to find timedia artist Mia Warren, who mystery of Pearls father she starts a ternoon TV and internet searching
BY SAM SACKS city employees doing it for them, be- rents a property from the Richard- series of deceptions and reprisals was done on AltaVista.
fore receiving hefty fines. On Hal- sons with her teenage daughter, that culminate in the fire. The writing is poised and tidy as
loween sirens blare at 6 and 8 p.m. Pearl, after years of nomadic, hand- Ms. Ng, whose best-selling debut, welltoo tidy, in fact, for a novel
THE SUBURBS are a hazardous to mark the start and end of trick- to-mouth subsistence. Just as Pearl Everything I Never Told You whose allegiances are with rebels
place for novelists to venture, and or-treating. is seduced by the easy comforts in (2014), also took place in small-town and freethinkers. The characters
the more comfortable they are the Elena Richardson is a third-gener- central traits are so baldly stated
more acute their dangers. Storytell- ation Shakerite who has raised her that they may as well be spelled out
ers are in their natural element children to respect its rules and reg- in topiary. Elena believes that pas-
when finding meaning amid confu- ulations. Shes a journalist at the lo- sion, like fire, [is] a dangerous
sion, like creators dividing light from thing, whereas our budding arsonist
the darkness. The problem with sub- Izzy senses in Mia a similar subver-
urbia is that it has already done the For a novel that sides with sive spark to the one she often felt
work for them. Its very purpose is to flaring inside her. Suburbias insidi-
provide order and stability. Because rebels and freethinkers, ous power is that it, much like high
its universe is designed to be pre- Celeste Ngs latest is a bit school, transforms people into ste-
dictable, novels set there need to be reotypes, defining them exclusively
in the business of un-makingof too poised and orderly. by the degree to which they fit in.
creative destruction. Ms. Ng doesnt dodge this trap.
This is especially true for the af- Which isnt to say that Little
fluent Cleveland suburb of Shaker cal newspaper, her husband is an at- Fires Everywhere isnt smart and
GETTY IMAGES

Heights, which, built in 1912, is torney, and their kids are Lexie, Trip, readable. Its both, eminently so. But
among the countrys oldest planned Moody and Isabelle, the last-named 2017 has seen unforgettable break-
communities. The eeriest details of being the youngest and the black downs of suburban domesticity in
Celeste Ngs novel Little Fires sheep of this neatly groomed fold. treatments as various as Nicole
Everywhere (Little Brown, 338 When the book begins, the Richard- the Richardson home (and by Trips Ohio, captures her setting with an Krausss intellectual fantasia Forest
pages, 14.99) concern the city ordi- sons beautiful house has burned pouting smile), Izzy becomes besot- ethnologists authority, fleshing out Dark, Dan Chaons gothic horror
nances that keep Shaker Heights down and everyone correctly as- ted with Mia, a woman, Elena disap- the regions politics (progressive), novel Ill Will and the undiluted
running with the precision of a fu- sumes that Izzy, who has vanished, provingly reflects, who took an al- its local scandal (a divisive custody surrealism of David Lynchs Twin
turistic dystopia. To avoid unsightli- started the blaze. Ms. Ng unfolds the most perverse pleasure in flouting battle), its infamous high school Peaks reboot. Ms. Ngs book seems,
ness, trash bins are stashed behind story of why she did it. the normal order. Shaker Heights prank (the legendary Toothpick Day in contrast, a little too orderly.
each house and picked up by gar- As with so many novels, events has rules about what shingle colors incident). And there are time-cap-
bage collectors on motor scooters. are set in motion when a stranger you can use but none about med- sule pleasures in her evocation of Mr. Sacks writes the fiction
Families who fail to mow their lawns comes to town, in this case the mul- dling, and when Elena pries into the 1997, when Jerry Springer ruled af- chronicle for the 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
A8 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

BOOKS
Here I am, out from behind the disguises and inventions and artifices of the novel. Here I am . . . denuded of all those masks. Philip Roth

Against Trivialization
structuralism, dodecaphony, Bartks Why Write? also contains
Why Write? music, Kafkas and Musils new aes- roughly half the contents of Reading
By Philip Roth thetics of the novel. A Modernist Myself and Others (1985) and the
Library of America, 452 pages, 29.99 Enlightenment, snuffed out by the complete contents of Shop Talk
postwar division of Europe. (2001), his two previous collections
BY JAMES CAMPBELL Mr. Roth can be said to have of nonfiction. There is a fond essay
played a part in rekindling the aes- on his friend Bernard Malamud
thetic flamehe would say a minor whose character surely shadows that
WHY WRITE? In an interview with part, but it is a significant one never- of E.I. Lonoff, the principal figure in
the Swedish newspaper Svenska theless. In 1976, he was instrumental Mr. Roths novel The Ghost
Dagbladet in 2014, four years after in establishing the Penguin series Writerand another about the art-
the publication of what he claimed Writers From the Other Europe, ist Philip Guston. In each case, the
would be his final novel, Philip Roth featuring works by Mr. Kundera, subject of the article is as much
offered an oblique answer to the Danilo Ki (Yugoslavia), Bruno Schulz Philip Roth as anything else. Reread-
question that gives the title to this ing Saul Bellow is the closest the
collection. Writing for me was a feat collection comes to straightforward
of self-preservation. . . . It was also literary criticism. Its pedestrian de-
my good luck that happiness didnt Roth grew up condent velopment, novel by novel, helps to
matter to me and I had no compas- that orthodox opinion answer the question why Mr. Roth
sion for myself. Though why such a has not done more in that line.
task should have fallen to me I have is the artists enemy. If Mr. Roths basic subject is me
no idea. Maybe writing protected me and my novels, the former is protec-
against even worse menace. tive of the latter. An amusing 14-page
The interview is one of 15 in Why (Poland) and George Konrd (Hun- letter to Wikipedia, titled Errata,
Write? Collected Nonfiction, 1960- gary). In A Czech Education, in- sets out to correct the misrepresenta-
2013. A reader opening the book in cluded here, Mr. Roth relates how, tions of his work that he found on the
expectation of an assortment of between 1972 and 1977, he traveled website. The first concerns the novel
literary and social essays, in the man- regularly to Prague to visit writers, The Human Stain (2000), described
ner of James Baldwin, John Updike journalists and historians whose in the Wikipedia entry at the time of
CONTOUR/GETTY IMAGES

or Gore Vidal, will be disappointed. In books could not be published and writing (2012) as allegedly inspired
addition to the interviews, there is a whom he terms the repudiated. by the life of the writer Anatole Bro-
scattering of brief memoirs and some Some were selling cigarettes at a yard. Broyard was a book critic for
appreciations, but Mr. Roths subject streetcorner kiosk, others were the New York Times, who, although
matter can be summed up as My wielding a wrench at the public African-American by heritage, passed
novels. And me. water works, others spent their days in literary society for white (there is
The sense of disappointment will REFLECTIVE Roth at his New York apartment, 2010. on bicycles delivering buns to baker- debate about how much of a secret
not last long. Mr. Roths responses to ies. . . . These people, as Ive indi- his passing was). When Mr. Roth con-
interviewers are eloquent and free Mr. Roth was speaking a decade and piece in Why Write? Mr. Klma and cated, were the cream of the nations tacted Wikipedia to correct the mis-
from inhibition. A man who can say a half before the words smartphone Mr. Kundera were allied in their op- intelligentsia. statement that his novel was based
It was . . . my good luck that happi- and Facebook were coined. position to the Communist regime in In 1977, Mr. Roth was refused a on Broyards experience, he was told
ness didnt matter to me is in a The trivialization of everything, he Czechoslovakia, but not in much else. visa to return to Czechoslovakia, (through his official interlocutor)
strong position to weather stormy continues in an interview titled On Mr. Klma explains that the picture of doubtless because his activities in that I, Roth, was not a credible
accusations, such as being a Jew Zuckerman, results from exactly the totalitarian system that one finds promoting writers of the Other Eu- source. I understand your point that
hater and a woman hater, charges what they do not have in Eastern in the migr Mr. Kunderas novels rope had by then reached the ears of the author is the greatest authority
that have pursued him down the Europe or the Soviet Unionthe free- novels that have had much greater the authorities. On one of the many on their own work, writes the Wiki-
years, since the publication of Good- dom to say anything. This leads to a success in the West than those of Mr. occasions on which he was accosted pedia Administratorbut we require
bye, Columbus (1959) and, espe- discussion of the proposition, not Klma himselfis the sort of picture by the police, Mr. Klma was ques- secondary sources.
cially, Portnoys Complaint (1969). uncommon at a time when the Soviet that you would see from a very capa- tioned about his friend Mr. Roths Mr. Roth reveals that the inspira-
It was Mr. Roths good luck to grow empire still stood, that the Western ble foreign journalist whod spent a regular visits to Prague. What was it tion for The Human Stain was an
up feeling confident that orthodox writer, blithe about freedom and few days in our country. Such a pic- all about? Mr. Klma reacted with unhappy event in the life of my late
opinionor correct thinkingis the shuttered from existential drama, ture is acceptable to the Western faux-naivet: Dont you read his friend Melvin Tumin, professor of so-
artists enemy. might benefit from a little state reader because . . . it reinforces the books? The policemen were stymied, ciology at Princeton for some thirty
There is one form of tyranny that oppression. fairy tale about good and evil, which but Ivan quickly enlightened them. years, the type of event involving
troubles Mr. Roth, however, of which Mr. Roths experience of Eastern a good child likes to hear again and He comes for the girls. student complaint that has become
he makes mention more than once in Europe and his involvement with again. Czech readers expect a As a punch line to a speechin more common since Tumins ordeal
this enjoyable book: the trivializa- writers from Czechoslovakia in par- deeper insight into our lives from a this case before the PEN Literary in 1985. Wikipedia amended the entry
tion of everything, which, speaking ticular forbids any such glibness. writer of Kunderas stature. Gala in 2013it would have raised a on The Human Stain but not
in 1988, he felt was of no less impor- Why Write? is unusual in contain- The interview with Mr. Kundera, laugh, but readers of a collection of enough to satisfy the greatest au-
tance for Americans than repression ing not only interviews with Roth, for though shorter, is equally engrossing essential statements on Mr. Roths thority on the work of Philip Roth.
is for Eastern Europeans. The threat the Paris Review and other journals, and a reminder of why in the 1980s writing life might hope for a more As well as being consistently intelli-
to serious literary debate in America but several interviews by him, with and 90s he was seen by Western thorough account of his involvement gent and entertaining, Why Write?
(he could have thrown in Britain and foreign writers: Aharon Appelfeld, readers as a wise and witty messen- with that Penguin series: the risks it is a primary source.
most of Western Europe, too) is not Primo Levi, Ivan Klma and Milan ger from an obscure planet, whatever presented to both authors and editor,
the censorship of this or that book Kundera among them. All justify the the merit of Mr. Klmas criticism its estimated successes and frustra- Mr. Campbell is the author of a
in some atypical school district some- space they occupy in another writers may be. Particularly striking is Mr. tions. A Czech Education is one of biography of James Baldwin,
where. . . . Its the superabundance of book, the last two in particular. Kunderas belief that it was in Central 14 pieces in the third and final part of Talking at the Gates, and a
information. If that claim sounds At almost 30 pages, the conversa- Europe that modern culture found the book, eight of which derive from columnist at the Times Literary
perfectly up to date, remember that tion with Mr. Klma is the longest its greatest impulses: psychoanalysis, the texts of speeches. Supplement.

Salvation and Self-Sacrice

McDermott noveland The Ninth mission to provide for Annie and, lined with towels, then graduates to stick. The decisive moment comes
The Ninth Hour Hour is a great onemakes you re- eventually, her baby daughter, Sally. playing on an old rug, helping to sort during one of the most mesmerizing
By Alice McDermott alize the wisdom of her decision to (The name of the nuns order all but the laundry, going to school and ulti- sections of the novel, when Sally
Bloomsbury, 247 pages, 16.99 stay put in the old neighborhood. demands a spontaneous genuflec- mately declaring her intentions to takes an overnight train from New
The Ninth Hour is a Brooklyn tion: The Little Nursing Sisters of become a nunagainst Annies Yorks old Penn Station to Chicago to
BY MAUREEN CORRIGAN novel. Like its immediate predeces- the Sick Poor, Congregation of Mary wishes. The irony is that Sally is enter the novitiate. The whole hallu-
sor, Someone, its set in the early- Before the Cross.) Even priests secretly motivated to join the con- cinatory journey reads like a specifi-
to-mid-20th century and is largely a pampered mommas boys, in the vent to save her beloved mothers cally female riff on the infamous
IF VARIETY WERE an absolute re- female story. It opens on a dark immortal soul. Nighttown chapter in James Joyces
quirement for literary greatness, February afternoon when a young What sounds like a Ulysses; instead of reveling (as
Alice McDermott would be out of Irish immigrant named Jim sends his simple plot-line is Leopold Bloom and Stephen Dedalus
luck. With few exceptions, her char- wife out to do her shopping and then complicated by a nar- did) in the lewd jokes, liquor and hot
acters are always Irish-American and turns on the gas tap in their apart- rative that jumps bodies pressed upon her, Sally is
Catholic. They live the kind of lives around in time, span- repulsed and, by journeys end, she
that are unfailingly called small ning events from the realizes that her own capacity to
meaning that theyre mostly working Civil War to the pres- generously minister to her fellow hu-
class. And Ms. McDermotts novels The Irish-Catholic women ent, and that also man beings has limits. Because Sally
frequently look back to an era (from in McDermotts ction noses its way deep is a young Catholic woman of her
the twilight years of Tammany Hall into the lives of other time, she feels guilty about this fail-
to the ascendancy of JFK) when feel the pull of martyrdom. characters in the ing and, so, tries harder and harder
Irish-Americans were a distinct and neighborhood and to sacrifice herself.
dominant urban ethnic presence. So within the convent. Female self-sacrificeits allure
resolutely does Ms. McDermott, who ment. Jim has just been discharged Theres Sister Lucy, a and moral complicationsis Ms.
was born in Brooklyn, remain on na- from his job as a trainman on the tough nut with a McDermotts overarching subject
tive grounds that her dedicated read- BRT. These days, we would call him habit of stopping here. (Her title alludes to the
ers no longer bother to ask what a clinically depressed, but the collec- neighborhood women ultimate Christian image of self-
new McDermott novel is about, tive diagnosis of Ms. McDermotts in the street and de- sacrifice: In the New Testament, the
but, rather, which outer borough of narrators (the novel is told from the manding, Is your ninth hour is the hour when Christ
New York City the story is set in this omniscient point of view of Jims husband good to died on the cross.) As Mary Gordon
time: Brooklyn, Queens or, for those future grandchildren) is, at once, you? Just as trying did almost 40 years ago in her now
GETTY IMAGES

characters whove moved on up, the more chilling and poetic: is Mrs. Costello, the classic debut, Final Payments, Ms.
outermost aspirational borough of milkmans wife, whos McDermott brilliantly dramatizes the
all, Long Island. His trouble was . . . he liked to re- missing a leg; she pull, especially on loving Catholic
Ms. McDermotts range may be fuse time. He delighted in refusing spends days propped daughters, of martyrdom. But, you
confined, but she sees a world within it. He would come to the end of a words of an otherwise good Catholic up by the window in a room filled dont have to be Catholic to under-
those dusty parish halls, tenements, long night, to the inevitability of 5 mother in the neighborhoodare el- with light that was the color of stand the impulse. Save yourself;
bars and funeral homes whose inter- a.m. . . . and while other men, poor bowed to the sidelines in this city of urine, the color of bile. Ms. McDer- others you cannot save, urges
est is inexhaustible. With the preci- sheep, gave in every morning, busy women. motts language is, as always, pre- Adrienne Rich in her early (1963)
sion of a masternever over-reach- turned like lambs in the chute Annie is given a job in the quiet cise, unpredictable, and gorgeous. feminist poem Snapshots of a
ing for significance or relaxing into from the pleasures of sleep or underworld of the convents base- She can make music even out of a Daughter-in-Law. Rich wouldnt
sentimentalityMs. McDermott lays drink or talk or love to the duties ment laundry, helping the aged Sister catalogue of Sister Illuminatas laun- have had to issue that warning if the
bare the reasons why those small of the day, he had been aware Illuminata wash, iron and mend do- dry supplies: Borax and Ivory and danger werent general. In The
lives matter. Though the culture of since his childhood that with the nated clothing, as well as the nuns bluing agents . . . bran water to Ninth Hour, Ms. McDermott has
her novels is very Catholic (real easiest refusal, eyes shut, he could own habits, soiled by their nursing stiffen curtains and wimples, alum once again managed a marvelous
holy, as we used to say in my own continue as he willed. work. (Annie contends with the water to make muslin curtains and literary feat: Shes written another
Catholic girlhood in Queens), even odor of vomit on wool and the ex- nightwear resist fire. one of those parochial novels of
readers who think that the term ex- Jims suicide leaves his pregnant cretions of the nuns own mortal Back to that reckless idea of hers whose reach is universal.
treme unction refers to excessive wife, Annie, adrift and also marks bodies: menstrual rags and long Sallys to join the convent: Given that
flattery can appreciate the comfort- the exitexcept for brief appear- johns stained yellow at underarm or The Ninth Hour is narrated by Ms. Corrigan, the book critic for the
ing coherency and power of her char- ancesof men from this novel. Nuns crotch.) The infant Sally sleeps at Sallys children, we readers already NPR program Fresh Air, teaches
acters religious worldview. A great from a nearby convent undertake the her mothers feet in a wicker basket know her vocation isnt going to literature at Georgetown University.
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. Friday - Sunday, September 22 - 24, 2017 | A9

BOOKS
What makes me such a lightning rod for fury? Im really asking. Im at a loss. Hillary Clinton

POLITICS: BARTON SWAIM

ONLY HILLARY
Can They Forgive Her? message. If you do, Ms. Clinton will
Clinton could make take responsibility.
this book boring. But what does that mean, ex-
What Happened actly? Throughout the book, she
(Simon & Schuster, pointedly does not blame the data
494 pages, 20) or the message; she vigorously de-
recounts the events of her 2016 presi- fends her campaign on both counts.
dential campaign, defends her own Whats meant to sound like a mea
conduct and decisions, and assigns culpa is just another insistence
the blame for her loss to Donald that she was basically right about
Trump in the November election. Ms. everything.
Clinton has always been a tough critic
of her foes. Surely we were in for a
scorcher. And yet its a snoozerex- A memoirist no less than
cruciatingly tedious.
Readers of her first two memoirs a politician must have
wont be surprised. The reason for some genuine awareness
the dreariness of Living History
(2003), about her upbringing and of his or her deciencies.
eight years as first lady, and Hard
Choices (2014), about her time as
secretary of state, isnt bad writing A memoirist no less than a poli-
or the inability to tell a story. tician must have some genuine
Theyre fluent and well-structured awareness of his or her deficiencies
narratives, and they dont avoid the and some ability to express that
controversies and scandals that awareness. The trouble with What
have dogged her public career: Happened is not that Ms. Clinton

GETTY IMAGES
Travelgate, the Rose law firms insists that she was right and that
billing records, Whitewater, the her adversaries were wrong and un-
Lewinsky scandal and impeachment fair in their criticisms. The trouble
trial of her husband, her response with her writing, and indeed with
to the attacks on American diplo- server; the medias fixation on that wrong? This paradox haunts all have realized it would be bad op- her whole political persona, is that
mats in Benghazi, Libya. investigation; Vladimir Putins in- three of her memoirs and deprives tics and stayed away from anything she is obsessed with her own recti-
What makes these accounts so terference on the Trump campaigns them of any genuine insight or in- having to do with Wall Street. I tude, and nobody else is.
hard to enjoy, even for her admir- behalf; sexism; and the voters who teresting thought. didnt. Thats on me. In all three of her memoirs, she
ers, is Ms. Clintons intense belief in assumed she would win and didnt In a passage early in this book, Her mistake was to think her quotes an apocryphal line from
her own righteousness and her ef- vote. But Americans with any inter- she recalls the severe criticisms she critics were honest and fair. Her John Wesley and claims that its a
fort to use every word at her dis- est in politics have been discussing received as a result of earning mil- fault was failing to remember that personal credo: Do all the good
posal to make you believe in it, too. and debating these points for the lions of dollars in speaking fees perfectly innocent activities can you can, for all the people you can,
What Happened is full of long, past 10 months. The only thing dis- from banking groups and refusing have bad optics. in all the ways you can, as long as
detailed explanations of why Ms. tinguishing Ms. Clintons discussion to release the transcripts of what Other moments of self-criticism ever you can. Ms. Clinton thinks of
Clinton and her campaign were al- is the rigorously one-sided way in she said. When you know why similarly miss the self part. Why this implausible dictum as somehow
ways well-meaning and principled which she presents it. youre doing something and you did I lose? she asks nearly 400 essential to her political brand,
but constantly disadvantaged and The author seems vaguely aware know theres nothing more to it and pages in. I go back over my own even as the rest of us think of her
repeatedly sabotaged at crucial mo- that the books chief hypothesis is certainly nothing sinister, its easy shortcomings and the mistakes we as a tough, ambitious and prag-
ments. Ms. Clinton blames her loss improbablewas everybody really to assume that others will see it the made. I take responsibility for all of matic politician. Her determination
on Donald Trumps dishonesty; his at fault except her and her senior same way, she writes. That was a them. You can blame the data, to make us see her as she sees her-
campaigns ability to generate un- campaign staff?and so at various mistake. Just because many former blame the message, blame anything self is what makes her writing so
thinking resentment; FBI Director points she offers half-hearted decla- government officials have been paid you wantbut I was the candidate. profoundly dulland perhaps also
James Comeys unprecedented blab- rations that she bears the ultimate large fees to give speeches, I It was my campaign. Those were what made her susceptible to de-
bing about his agencys investiga- blame. But how can she bear the shouldnt have assumed it would be my decisions. Note the pronoun: feat by a man who, whatever his
tion into her use of a private email blame if she never did anything okay for me to do it. . . . I should You can blame the data or the weaknesses, cant be called boring.

The Cold War on the Ocean Floor

Dean writes: communications codes, would take five years and cost at books and coding machinery. The over Project Azorian, Mr. Dean says
The Taking of K-129 code-breaking machinery, and most least $250 million, and the personnel Explorer retrieved the rest of the sub, that in that same year Helms
By Josh Dean compelling of all, the nuclear war- involved wouldnt know if many of however, and the Navy and CIA did strongly disliked the ideaclarifica-
Amberley, 431 pages, 20 heads atop the ballistic missiles. Any the Explorers novel high-tech ele- obtain some useful information about tion by the author would have been
combination of these things would ments worked until the ship was Soviet submarine technology and the helpful. And the relationship
BY HOWARD SCHNEIDER provide the greatest intelligence haul hovering over its target. K-129s missiles. between the Hughes Tool Co. and the
of the Cold War. The CIA realized that a spectacu- When the Explorer returned to the Summa Corp. (also a Hughes busi-
Obtaining those items, however, lar vessel like the Explorer couldnt U.S., some government officials ness) is confusingly blurry.
THE COLD WAR wasnt a shooting meant somehow raising the subma- be kept a secret, and so the agency wanted to order the ship to return to Was Project Azorian worth the
conflict, but that doesnt mean there rine, and conventional wisdom held crafted an ingenious cover story to the K-129 and secure the remains. money spent and the incredible work
werent casualties. Nor does it mean that no technology existed that could account for it. The Hughes in the But in the fall of 1974 the Soviet Em- that went into it? Mr. Dean thinks it
that the United States and the So- perform the task. Furthermore, if the ships name was the astounding bassy in Washington was tipped off was. He takes what can be called the
viet Union didnt use every resource Soviet Union discovered an American Howard Hughes. His companies were that the American government had aesthetic-existential view: The fact
at their disposal to learn as much as attempt to seize the K-129, all geopo-
possible about each others military litical hell would break loose, includ-
capabilities. Josh Deans The Tak- ing, possibly, armed confrontation.
ing of K-129: How the CIA Used But because Americans in high
Howard Hughes to Steal a Russian places (including, eventually, Presi-
Sub in the Most Daring Covert Oper- dents Nixon and Ford) fervently
ation in History is an absorbing, desired the K-129, a stealth project
suspenseful chronicle of a remark- was launched.
able Cold War episode.
On Feb. 24, 1968, the Soviet sub-
marine K-129, 328 feet long, diesel- How the CIA recovered a
powered, with a crew of 98, sailed
from its base on the Kamchatka sunken Soviet submarine
Peninsula in Russias far east. It was in an ingenious and high-
equipped with the newest, most
advanced navigation system in the risk covert operation.
Pacific Fleet, Mr. Dean writes, and
carried three nuclear ballistic mis-
siles. The submarines mission: pa- The venture, code-named Project
trol off the Hawaiian Islands and, in Azorian, was assigned to the Central
case of war, annihilate three vital Intelligence Agency rather than the
military bases there. The Soviet navy Navy because the agency had a great
lost contact with the vessel on March deal of technological expertise with
8 and a day later commenced a spy planes, like the U-2, and spy sat-
search. The operation, which encom- ellites. How did Project Azorian
passed a million square miles of the retriev[ing] a 3-million-pound sub-
Pacific, was a failure. In September, marine from 16,700 feet under the
Mr. Dean says, the Soviets an- Pacific Ocean, a task every bit as
GETTY IMAGES

nounced that the sub had been lost daunting as the moon landing
. . . and that all the men on board proceed? With a huge, technically
were presumed dead. dazzling ship, the Hughes Glomar
The American Navy quickly real- Explorer, that was created by gov- COVER The barge inside which the Glomar Explorers claw was assembled.
ized that the Soviets were searching ernment agencies, defense contrac-
for a lost submarine and that it was tors and other arms of the military- enlisted to tell the world that they designs on the K-129, and in Febru- that the [CIA] built and protected a
probably the K-129. After the industrial-intelligence complex. In were building the Explorer to mine ary 1975 the Los Angeles Times dis- cover story for five years is undeni-
U.S.S.R. ended its hunt, Americas the days before modern computers, the ocean floor for valuable manga- closed the real purpose of Project able; by that measure alone, the proj-
superior technology succeeded Mr. Dean notes, it was designed with nese nodules. This cover storycom- Azorian. The Explorer never re- ect was a success. And the program
where its opponent hadnt. Hydro- faith, and pencils. plemented by some discreet CIA turned to the Soviet submarine; its engineers . . . did design and build the
phones in the Pacific designed to The vessels main features were a arm-twisting of journalistshood- glory days were over. In 2015 it was most complicated ship in history, a
detect Soviet undersea nuclear tests moon pool, a huge hollow in the winked the public and even Soviet sold for scrap. vessel that everyone considers a
registered an explosion on March 11 ships bottom to hold the sub; a sys- intelligence. The Taking of K-129 is admira- marvel. That ship was able to do
that was almost surely the K-129. tem to disgorge and retract twenty On July 4, 1974, more than six bly thorough in its research. Mr. something that seemed nearly impos-
Further analysis of the data re- thousand feet of threaded gun-barrel years after the K-129 sank, the Ex- Dean, a longtime magazine journal- sible. But as an ornery taxpayer and
vealed that the sub had sunk 1,560 steel pipe; and a mechanical grab- plorer reached the submarines loca- ist, clearly loves technology, and he amateur realpolitiker, I suspect that
miles northeast of Hawaii under al- ber or claw, attached to the steel tion. Thirty days after it arrived, the is quite good at describing it. He is the Cold War would have followed
most 17,000 feet of water. pipe, for enfolding the K-129. The pipe and claw began lifting the K-129. also deft at detailing how govern- the course it did even if the Explorer
A U.S. submarine was dispatched claw was so large that, to avoid de- But some of the claws tines were ment agencies interacted with one had secured the entirety of K-129. In-
to the site and took photographs that tection, it had to be assembled off- stressed by contact with the sea floor another and with the private sector. cidentally, it has never been learned
confirmed the K-129 was where the shore inside a nondescript barge, and by the pressure of clutching the Two cavils: Thirty pages after Rich- what destroyed the submarine.
hydrophones indicated. American which was then submerged and K-129, and two-thirds of the sub ard Helms, the director of central in-
government officials were eager to towed to the Explorer. The extraordi- plummeted back to the bottom of the telligence, is described as want[ing] Mr. Schneider reviews books
examine what was inside the sub, Mr. nary planning and construction Pacificalong with its missiles, code very badly for [the CIA] to take for newspapers and magazines.
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A10 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

OPINION
REVIEW & OUTLOOK
Donald Trump
All Mr. Comeys Wiretaps Goes Nuclear
W
hen Donald Trump claimed in March search firm Fusion GPS and developed by former
that hed had his wires tapped prior British spy Christopher Steelewho relied on On July 28 this year, suggest the Iranians are less trust-
North Koreas Kim worthy on nukes than, say, Mikhail
to the election, the press and Obama Russian sources. But the Washington Post and
Jong Un tested an in- Gorbachev.
officials dismissed the accusa- others have reported that Mr. tercontinental ballistic Since 1993, the U.S. has pursued
tion as a fantasy. We were Congress needs to learn Steele was familiar to the FBI, missile. Analysts said the standard model of rational-man
among the skeptics, but with how the FBI meddled had reached out to the agency its potential flight path arms control negotiations with North
former director James Comeys about his work and had even on an optimum trajec- Korea. This false presumption now
politicized FBI the story is get- in the 2016 campaign. arranged a deal in 2016 to get WONDER
tory could travel some has brought us to within perhaps one
LAND
ting more complicated. paid by the FBI to continue his By Daniel
6,400 miles. We cant year of Kim being able to attach a
CNN reported Monday that research. help but notice that miniaturized nuclear bomb to the
Henninger
the FBI obtained a warrant last year to eaves- The FISA court sets a high bar for warrants most of the commenta- cone of an ICBM.
drop on Paul Manafort, Mr. Trumps campaign on U.S. citizens, and presumably even higher tors who are dumping The day that happens, the world
manager from May to August in 2016. The story for wiretapping a presidential campaign. Did condescension on President Trump for will have crossed a Rubicon into a nu-
threatening to totally destroy North clear reality incomparably more dan-
claims the FBI first wiretapped Mr. Manafort in Mr. Comeys FBI marshal the Steele dossier to
Korea live in New York or Washington gerous than anything in the previous
2014 while investigating his work as a lobbyist persuade the court? rather than Seattle or San Francisco. seven decades. On Tuesday, a U.S.
for Ukraines ruling party. That warrant lapsed, All of this is reason for House and Senate Or Seoul or Tokyo or anywhere people president spoke truth to nuclear
but the FBI convinced the court that administers investigators to keep exploring how Mr. live who no longer see Kims 250-kilo- power. Eastern punditry will never re-
the Foreign Intelligence Surveillance Act (FISA) Comeys FBI was investigating both presiden- ton bomb as an intellectual or journal- cover from the way Mr. Trump said
to issue a second order as part of its probe into tial campaigns. Russian meddling is a threat istic abstraction. it, but the rest of the rational world
Russian meddling in the election. to democracy but so was the FBI if it relied on Mr. Trump violated foreign-policy will adapt.
Guess who has lived in a condo in Trump Russian disinformation to eavesdrop on a pres- sensibilities on the Eastern Seaboard
Tower since 2006? Paul Manafort. idential campaign. The U.S. Justice Depart- by saying out loud what has been an
The story suggests the monitoring started in ment and FBI have stonewalled Congressional implicit reality of U.S. strategic pol- Critics of Trumpian rhetoric
icy since the dawn of the nuclear live outside the range of
the summer or fall, and extended into early this requests for documents and interviews, citing
age: We reserve the right to use nu-
year. While Mr. Manafort resigned from the cam- the integrity of Special Counsel Robert clear weapons to pre-empt a first Kims missilesfor now.
paign in August last year, he continued to speak Muellers investigation. strike from an adversary, and that in-
with Candidate Trump. It is thus highly likely But Mr. Mueller isnt investigating the FBI, cludes an enemys nuclear, chemical
that the FBI was listening to the political and and in any event his ties to the bureau and Mr. or biological weapons. The reason re- Adaptation of some sort is needed
election-related conversations of a leading con- Comey make him too conflicted for such a job. sided in one simple Cold-War word: as well to Mr. Trumps thoughts on
tender for the White House. Thats extraordi- Congress is charged with providing oversight deterrence. sovereignty, mentioned more than 20
naryand worrisome. of law enforcement and the FISA courts, and it Toward the end of the Obama pres- times in the speech. I have no fully
Mr. Comey told Congress in late March that has an obligation to investigate their role in idency, concerns emerged that Mr. graspable idea what he is talking
he had no information that supports those 2016. The intelligence committees have sub- Obama would adopt the no first use about, and Im not sure Mr. Trump
[Trump] tweets. Former Director of National poena authority and the ability to hold those doctrine on nuclear weapons long fa- does either.
vored by progressive arms-control ac- The idea of protecting a countrys
Intelligence James Clapper was even more spe- who dont cooperate in contempt.
tivists. He did not. Also worth keep- national security and economic in-
cific that there was no such wiretap activity Mr. Comey investigated both leading presi- ing in mind amid the outcry that Mr. terests is easy enough to under-
mounted againstthe President-elect at the dential campaigns in an election year, playing Trumps speech violated some sort of stand. Mr. Trump, however, seems to
time, or as a candidate, or against his campaign. the role of supposedly impartial legal authority. international gentlemens agreement be talking about something more
He denied that any such FISA order existed. But his maneuvering to get Mr. Mueller ap- is that NATO has refused for 70 years transcendent.
Were they lying? pointed, and his leaks to the press, have shown to adopt no first use. Sovereignty as a mystical force in
The warrants timing may also shed light on that Mr. Comey is as political and self-serving Until recently, no American presi- the lives of nations is an idea brought
the FBIs relationship to the infamous Steele as anyone in Washington. No investigation into dent needed to make such threats in into the Trump presidency by Steve
dossier. That widely discredited dossier claim- Russias role in the 2016 campaign will be credi- public. An assumption of the Cold Bannon and articulated in the United
ing ties between Russians and the Trump cam- ble or complete without the facts about all Mr. War was that the Soviet Unions lead- Nations speech and elsewhere by Mr.
paign was commissioned by left-leaning re- Comeys wiretaps. ership ultimately was rational, and so Trumps chief speechwriter and Ban-
we negotiated nuclear agreements non ally, Stephen Miller.
with them. Some similar baseline of Nationalism and what it means for

The Slow and Steady Fed assumed rationality attached to deal-

ing with each subsequent nuclear
increasingly volatile populations is a
good subject just now, but I dont

T
power, such as China, India and even think Messrs. Bannon and Miller have
he Federal Reserves Open Market Com- The Fed will need to keep more assets now Pakistan. put across the idea in any feasible
mittee said Wednesday that the not-so- given the increase of cashan offsetting Fed Pakistan and Indiaestimated to operational sense for U.S. policy mak-
rapid unwinding of its $4.5 trillion liabilityin circulation. But a return to the have more than 100 nuclear warheads ers. In practice, that makes it largely
bond portfolio will finally be- Feds precrisis role of buying eachrattled the worlds nerves as irrelevant.
gin in October, and markets A rate increase in only Treasury bonds to con- recently as 2002, when the two coun- My own tastes in Trumpian philos-
are taking it in stride. The duct open-market operations tries massed armies along their ophizing run more toward statements
committee also signaled that
December looks ought to be the goal. 2,000-mile border after a terrorist at- like this at the U.N.: Major portions
increasingly likely. tack on the Indian Parliament. of the world are in conflict, and
another interest-rate increase Former Chair Ben Ber- Whether Irans revolutionary and some, in fact, are going to hell.
is probably coming in Decem- nanke sold the Feds quantita- messianic religious leadership is ra- Again, the pundits gagged, pre-
ber, and that isnt spooking tive easing policies as a crisis- tional in the Cold War meaning lies sumably nostalgic for the prudent,
anyone either. driven necessity that wouldnt last forever, and at the heart of the disagreement over considered cadences of Barack
Theres no reason they should, since the Fed with the crisis now past the Fed should return the Obama nuclear deal with Tehran. Obama, whose foreign policies left
is moving at such a gradual pace that no one to its traditional economic role for the sake of The Iranians understood this require- much of the world, um, going to hell.
is being taken by surprise. Our balance sheet its own credibility. ment, and so they put forth as their Aleppos bombardment into rubble
will decline gradually and predictably, Fed No one should call any of this a tight mone- negotiator Foreign Minister Javad Za- comes to mind.
Chair Janet Yellen said at her news conference tary policy, not with the fed funds rate still at rif, a rational man from Hollywood Hearing Mr. Obama describe more
following the Fed meeting. We wish the pace 1%-1.25%. The bigger question is how the Fed central casting, unlike the evil-eye of the same will cost you $400,000
mullahs who actually decide Iranian now. President Trump gets to talk for
of the asset drawdown were faster, and had be- will respond if U.S. Congress passes tax reform
nuclear strategy, which looks a lot free about Kim Jong Uns march to-
gun sooner, but at least it is finally under way that lifts growth to more than 3%. (See nearby.) like North Koreas nuclear strategy. ward a nuclear Armageddon. Between
and will march on a steady course. Then it may have to reconsider its slow pace Yet another of Mr. Trumps violations these two, Ill take the free version.
One lingering uncertainty is how far the Fed of rate increases, lest it repeat its mistake of of Eastern Seaboard sensibilities is to Write [email protected].
will shrink its balance sheet, which was less 2003 and keep rates too low for too long after
than $1 trillion before the 2008 financial panic. a pro-growth tax cut. We know how that ended.

Americas Tax-Reform Progress

Kick North Korea
Out of the U.N.
U
.S. House Republicans like to grouse sumptions mean they always underestimate
about the Senate as a legislative grave- the growth impact of cuts in tax rates and on
By Claudia Rosett The U.S. and its allies pay most of
yard, but on tax reform GOP Senators capital income. The $1.5 trillion deal liberates

C
the tab for these amenities, while
may be saving the day. A ten- Congress from that process alls by the United Nations Se- Pyongyang avails itself of opportuni-
tative deal between Senators A Senate budget deal tyranny. curity Council to isolate North ties for spying, money laundering and
Pat Toomey and Bob Corker to creates more space The Senate is more crucial Korea havent stopped Kim illicit procurement.
create $1.5 trillion in tax- this time because the House Jong Un from launching missiles over From the start North Korea was in-
cutting room as part of the for cutting tax rates. still hasnt found a majority Japan or threatening America and its tent on causing trouble for the U.N.
budget resolution could res- for its budget resolution. allies. This week President Trump As early as 1993 the Security Council
cue the House from its famil- Freedom Caucus Reps. Mark told the General Assembly that the was expressing concern that Pyong-
iar factional dysfunction. Meadows and Jim Jordan complained Thursday U.S. is prepared to totally destroy yang was out of compliance with U.N.
North Korea in the event of an at- nuclear safeguards. North Korea is
The Senatorskey voices on the Budget on these pages that House leaders want Mem-
tack. If the international community now in violation of nine Security
Committeeannounced their deal without bers to vote on a budget without first releasing is serious about isolating the Kim re- Council resolutions, after developing
specifying a budget number, but our sources the details of tax reform. They contend this or- gime, theres a less drastic option intercontinental ballistic missiles and
confirm that the handshake is for $1.5 trillion der doomed ObamaCare repeal: Members were not yet tried: Expel North Korea from carrying out six nuclear tests.
over 10 years. This means the budget resolution presented with a fait accompli and werent al- the U.N.
will not have to bow to the Beltway golden idol lowed to influence policy. Since the U.N.s founding in 1945,
known as deficit neutrality, so it can be a net This is fake history. The Freedom Caucus de- no member state has ever been ex- Membership has its
tax cut. This creates more budget room for cut- mandedand wonmany accommodations on pelled. The U.N. charter does, how-
ting rates and increases the chances that a tax health care. One was preserving the tax exclu- ever, provide for eviction: A Member privilegesspying,
reform will be large enough to spur the econ- sion for employer-sponsored health insurance of the United Nations which has per- money laundering
omy and raise incomes. that is a subsidy for large companies, and so sistently violated the Principles in the
present Charter may be expelled from and illicit procurement.
In an ideal world, Congress would put policy much for conservative purity on that one. By
the Organization by the General As-
above this process mumbo-jumbo. But in Wash- Messrs. Meadows and Jordans own account, sembly upon the recommendation of
ington a budget outline is necessary for passing their later demands improved the House Obama- the Security Council. As for human rights, a special U.N.
tax reform under the Senates reconciliation Care repeal bill that eventually passed. North Korea never met the U.N. Commission of Inquiry concluded in
process that allows a bill to pass the upper On tax reform, the Freedom Caucus has al- membership requirements to begin 2014 that the gravity, scale and na-
chamber with 51 votes. The alternative is rely- ready helped scuttle the border-adjusted tax. with. The charter says membership ture of the violations committed by
ing on the tender mercies of Chuck Schumers Now the gang has pivoted in private to target is open only to peace-loving the Democratic Peoples Republic of
Democrats to come up with 60 votes. expensing provisions, while claiming in public states that promote respect for Korea reveal a state that does not
In an ideal world, the Senate deal would cre- that they have no idea what the reform in- human rights and for fundamental have any parallel in the contempo-
ate room for tax cuts of $2.5 trillion or more. cludes. The real question is whether any con- freedoms. rary world.
Thats at least how much more revenue the gov- cession will appease themor if theyll keep North Korea was admitted in tan- A bid to toss North Korea out of
dem with South Korea on Sept. 17, the U.N. would need strong U.S. lead-
ernment would get if the economy returned to moving the goal posts until the bill is impossi-
1991. At the time, with the Soviet ership, and it could fail. China and
its historic growth rate of 3% a year from the ble to pass. Union in the process of collapse, the Russia could block it with their Secu-
Obama eras 2%. Better policy like tax reform The political reality is that the budget reso- rationalization was that finally bring- rity Council vetoes. The despot-
would help growth get to 3%, but Senate lead- lution has only one purpose: A vehicle to pass ing North Korea into the U.N. fold packed General Assembly, wary of
ers fear such an estimate might scare some tax reform in the Senate with 51 votes. Every- might induce it to give up its brutal setting a precedent, could balk.
Members and they can only afford to lose two thing else is political eyewash. If the Toomey- and predatory ways. Its still worth a try. Even failure
of their 52 GOP Senators on the floor. The $1.5 Corker deal passes the Senate, the House Instead, the legitimacy and per- would better illuminate the perils of
trillion figure is fiscally conservative to a fault, should adopt it and move on to the substance quisites conferred by U.N. member- relying on a U.N. that values North
and if Republicans cant agree on that much of tax reform. ship might have helped the regime Koreas company above its own
they ought to pack up and go home. On that score, the $1.5 trillion is a decent survive. charter. Success could help undercut
Expelling North Korea now could the Kim regime, and confer a mea-
The $1.5 trillion deal will also be scored on start, and Republicans can create more running
undermine Mr. Kim domestically. His sure of badly needed redemption on
a static basis, which means it wont be hos- reform for lower rates by closing loopholes. The regime would lose the international the U.N. itself.
tage to growth estimates from the gnomes at state and local tax deduction is worth another respect that accompanies a U.N. seat.
the Joint Tax Committee and Congressional $1.25 trillion or so. Republicans should follow North Korean diplomats would be Ms. Rosett is a foreign policy fel-
Budget Office. Those outfits will still produce the Toomey-Corker lead, get past phony budget forced to give up access to lavishly low with the Independent Womens
an additional dynamic score that considers obstacles, and move on to fulfill their promise appointed U.N. offices and soirees in Forum, and author of What to Do
economic growth, but their Keynesian as- to reform the tax code. New York, Rome and Vienna. About the U.N. (Encounter).
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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THE WALL STREET JOURNAL. Friday - Sunday, September 22 - 24, 2017 | A11

OPINION

After Islamic State, Is There Still an Iraq?

By Michael Dempsey the answer will be determined by widely viewed as only a temporary

A
how the Iraqis respond to five key solution, and most experts still be-
s the U.S.-led coalition ef- unresolved issues. lieve there is the potential for a cata-
fort to destroy Islamic First, the Kurdish independence strophic dam breach.
States physical caliphate referendum, originally scheduled for Fifth, Mr. Abadi has to begin
nears its endgame in Sept. 25, is threatening to spark a preparing for local and national
Iraq, a major question full-blown crisis even before Islamic elections. Despite a surge in his
hangs over the country: Is there State is defeated on the battlefield. popularity following the Iraqi mili-
still an Iraq? At issue is whether a large chunk of tarys victories against Islamic
Islamic State has suffered a series Iraq will eventually break away en- State, he will likely face a signifi-
of crippling blows, including its loss tirely or redefine its relationship cant re-election challenge from,

AHMAD AL-RUBAYE/AFP/GETTY IMAGES

of the strategically important town with the central government. Com- among others, Hadi al-Amiri, a
of Tal Afar in Nineveh province. The plicating the issue is the inclusion in longstanding ally of Iran.
U.S.-led coalition will next focus on the vote of disputed territories, in- Mr. Abadi has been a strong part-
driving Islamic State out of Hawijah, cluding the oil-rich city of Kirkuk, ner for the U.S. in the counter-Is-
some 200 miles north of Baghdad. which is held by Kurdish forces but lamic State campaign, and his re-
claimed by Baghdad. election offers the best hope for
On Monday Iraqs Supreme Court continuing a positive working rela-
Reconciliation is possible, ordered the referendum suspended tionship between Washington and
until it can assess the votes legality. Baghdad, and for balancing Tehrans
but the country will have United Nations Secretary-General growing influence in Iraq.
to overcome at least Antnio Guterres is also calling for a An Iraqi patrol near Tal Afar on Aug. 27. Other challenges will eventually
delay, as are U.S. Secretary of State have to be addressedamong them
five major challenges. Rex Tillerson and the Turkish and ties. This is a difficult task given Fourth, as winter approaches, closing the governments budget
Iranian governments. Kurdish leader the deep divisions over this issue Baghdad must make progress in im- deficit, modernizing the oil infra-
Masoud Barzani has previously within the Iraqi parliament, but proving living conditions throughout structure and strengthening the
Hawijah has an outsize military hinted that he might delay the refer- Sunni isolation fueled Islamic the country. Islamic State devastated banking sector. But these five chal-
importance because Islamic State endum until after national elections States rise, and progress must be infrastructure in the areas it con- lenges are urgent.
has used it as a staging area from in April, but only at the price of con- made on this issue soon. trolled. The latest U.N. estimate is After nearly three years of a gru-
which to attack Baghdad with hun- cessions and assurances about the Third, Baghdad must exercise that some 11 million Iraqis require eling fight against Islamic State and
dreds of improvised explosive de- Kurds future status. tight control over the thousands of humanitarian assistance, with more a huge commitment of U.S. blood
vices, including car bombs. When the Whether or not the referendum is Shiite militia fighters (many of than three million displaced across and treasure, there is finally reason
Hawijah operation is complete, the held next week, its likely to be only whom participated in Tal Afars lib- the country, more than one million to be optimistic about Iraqs future.
coalition will focus on attacking Is- the opening act in lengthy negotia- eration) and limit their authority in living in temporary housing settle- But the country is nearing an inflec-
lamic State in its remaining enclaves tions between the parties, and re- traditional Sunni areas. Mr. Abadi ments, and more than 200,000 refu- tion point, and only with mature and
along the border with Syria. solving the question in a way that must ensure that the Shiite militias gees abroad. The critical work of inclusive leadership in Baghdad, sus-
Once Islamic State has been de- doesnt undermine Baghdads legiti- arent allowed to determine unilater- providing food and shelter to dis- tained U.S. engagement, and support
prived of the territory it holds, can macy and threaten Iraqs neighbors ally which populations are allowed placed Iraqis is a top priority. from key allies in the West and the
Iraqs major communities come to- will be critically important. to re-enter liberated areas, and that The recent claim by Iraqs minis- Gulf Cooperation Council will it be
gether to share power and build a Second, to ensure that Islamic the bulk of reconstruction aid from ter of water resources that the Mosul possible for Iraq to achieve a future
common future? That question is State remains marginalized, Prime Baghdad isnt distributed only to Dam is no longer in danger is worri- with less violence and suffering and
sparking increasingly heated de- Minister Haider al-Abadi must ac- Shiite communities. The Shiite mili- some, especially if it reflects a will- more reconciliation.
bate in Iraq and the international celerate long-delayed political rec- tias are deeply distrusted by the ingness of the central government to
community. onciliation efforts, specifically by Sunni populations of Nineveh and gloss over difficult infrastructure- Mr. Dempsey is national intelli-
In my opinion (which doesnt re- easing de-Baathification efforts and Anbar provinces, and they are a po- related challenges. The grouting gence fellow at the Council on For-
flect the view of the intelligence providing more local power and job tential flashpoint in the delicate Shi- work performed by an Italian firm to eign Relations, a fellowship spon-
community or the U.S. government), opportunities to Sunni communi- ite-Sunni relationship. shore up the dams foundation was sored by the U.S. government.

Four Facts for Theresa May and the Brexiteers

By Andrew Hammond The success of the speech will where and put pressure on Brussels that Britains place in Europe will and the EU will be obliged to en-
And Tim Oliver turn on how well Mrs. May ad- and other national leaders to reform be shaped by this dynamic, and not gage much more constructively in

T
dresses four central points, much to the EU in ways that would benefit only by its own plans for Brexit. Brexit negotiations.
heresa May gives a landmark do with Britains own attitude to- Britain and make Brexit easier. Brexit is but one of several chal- Such statesmanship wont be
speech in Italy on Friday that ward Brexit. Thats not happening. To many lenges and opportunities confront- easy for Mrs. May. Losing her ma-
may be her last best chance First, she needs to be more hon- politicians and voters in France and ing Brussels, among them the pres- jority in an election called to
to get Brexit moving. Despite the est about what Britain can and can- Germany, for instance, Brexit looks sures facing the eurozone, the strengthen her political position
setting, shell need to speak at least not achieve in the two-year time- passport-free Schengen zone, Rus- was one of the most disastrous
as much to a domestic audience as frame of the so-called Article 50 sian relations, the future of NATO electoral outcomes in British his-
to a foreign one, in the hope of process for negotiations with Brus- Brexit is not magically and ties with the U.S. tory. The subsequent public infight-
starting to resolve some of the deep sels. Hoping that Brexit could be set- How the EU responds to these ing among cabinet members shows
divisions surrounding Brexit policy tled between March 2017 and 2019 remaking the European pressures will determine its place in that many disputes surrounding
at home. was unrealistic from the start. Union, and Britain needs the world and frame its future rela- Brexit are still unreconciled.
Britain under Mrs. Mays leader- This part of the speech should be tionship with Britain. A longer Britain remains a country of im-
ship seems unclear about what end as much addressed to a domestic a reality-based strategy. Brexit transition period would allow mense power and potential, which
it wants from Brexit, let alone audience in Britain as it is to the Britain and the EU time to forge a can only be fulfilled if it is gov-
what means it should use to get rest of the European Union. Brexi- new, successful relationship based erned by leaders with a clear
there. This leaves Britain heading teers must understand that Britain like an act of vandalism. Britains on mutual self-interest. strategy for what they want to
toward a hard, disorderly Brexit is likely to require a transitional ar- Brexit indecision isnt setting a pos- Fourth, Mrs. May shouldnt lose achieve and an ability to direct
that could see an unprecedented rangement after 2019, and that this itive example for others. And the sight of domestic politics beyond Britain toward it.
breakdown in relations with its will require continued budgetary stronger performance of the Euro- Brexit. Most British peoples lives Florence may be Mrs. Mays last
closest neighbors, trading partners contributions to Brussels to buy pean economies over the past year, are defined by other concerns. Al- chance to turn things around. The
and allies. more time. Mrs. May needs to face plus the failure of far-right popu- lowing for a longer transition would challenges are real, but if she can
Mrs. May still has a limited win- down right-wing critics on this is- lists to win elections in France and give time to focus on drivers of posi- surmount them, the prize could be
dow of opportunity to turn things sue. A coherent explanation of the the Netherlands, is changing the tive change in British society, such a clearer course for positive future
around, with a new president in problem would be a start. mood such that closer European in- as education, public works and pro- relations with European allies.
France and Angela Merkel looking Second, Mrs. May needs to dis- tegration, rather than disintegra- ductivity, and help deliver the most
set to win a new term in Sundays miss any lingering hopes held by tion, now seems more likely. This prosperous post-EU future. Mr. Hammond is an associate at
German elections. In what is being some Brexiteers about the potential potentially reduces British leverage If Mrs. May delivers, she will cre- LSE IDEAS at the London School of
billed as a set-piece, agenda-setting for a reordering of European geopol- in negotiations, which was not high ate the political capital and diplo- Economics. Mr. Oliver is a Jean
speech in Florence, the prime min- itics. Some Brexiteers hoped that to begin with. matic space for a smoother pathway Monnet fellow at the European Uni-
ister on Friday will set out her up- Britains vote to leave would trigger Third, Mrs. May needs to recog- in Brexit talks, increasing prospects versity Institute in Florence and an
dated vision for Brexit. similar popular movements else- nize that the EU is changing and of a good final deal. And Brussels associate at LSE IDEAS.

Europe Needs to Talk About Resilience

By Michael Heise Since then, regulators have hold large amounts of their sover- policy makers shouldnt be shy to an end in all countries, but it has

T
worked studiously to prevent future eigns bonds, any doubt about the about raising them, even if this leads progressed significantly.
en years have passed since the liquidity crunches and asset melt- sustainability of a countrys public them straight to the current state of In the U.S., for example, lending
U.S. subprime crisis spilled downs. They have ramped up capital finances could once again destabilize monetary policya taboo subject in to nonfinancial firms and house-
over into Europe and beyond. and liquidity requirements, re- its banking sector. many political circles. It shouldnt holds has been accelerating. In
Questions of financial resilience have stricted certain business activities Moreover, the zero-capital require- be: Low or negative central-bank some areas, such as car and student
been hotly debated on the Continent and revamped remuneration incen- ment for government bondsallow- rates still represent the biggest risk loans, this is happening at a truly
ever since. tives to reduce reckless risk taking. ing banks to accumulate government to long-term financial stability. disturbing pace. The U.S. Federal
For many, the global financial Risk management, especially in sys- bonds without needing to match Reserve is therefore right to exit its
crisis shattered the belief that temically important institutions, is higher levels of capital to limit risks, ultraexpansionary policies, and oth-
highly developed financial markets now under intense scrutiny by regu- and therefore incentivizing banks to Regulators can no longer ers should stand ready to follow
tend to be robust and good for eco- lators and supervisors. do socrowds out private bonds and suit in practice, implementing what
nomic growth. Their purported As a result, financial systems in thereby runs counter to central-bank ignore the financial- to date has been only hinted at by
benefits, such as efficient capital the large Western economies are efforts to channel more money into stability dangers they the Bank of England and the Euro-
allocation and the monitoring and now better supervised and more ro- the private economy. pean Central Bank.
transfer of risk, were nowhere to bust. Given the massive scope of the Finally, institutional investors created after the crisis. Proponents of pure inflation tar-
be seen. Rather, it was the effi- reregulation, however, some incon- such as insurers need to cover bank geting will, of course, reject the no-
ciency of financial markets, in the sistencies have crept in. bonds with large amounts of capital tion that central banks should be
shape of ever more complex instru- One of the most damaging incon- not only because of default risks, but The prolonged stimulus provided responsible for financial stability,
ments and cross-border schemes, sistencies lies in preferential capital also because their prices vary sub- by the European Central Bank, the arguing that monetary-policy in-
that tipped the Western world into requirements for government bonds. stantially in the course of the credit Bank of Japan and the Bank of Eng- struments are too blunt to prevent
what has become known as the Regulators still consider them to be cycle. This makes it difficult for land, among others, is supposed to mispricing and excessive leverage.
Great Recession. risk-free. As eurozone banks still banks to place bail-in capital outside push up asset prices, trigger more This argument is inconsistent. It is
the banking sector. This is inconsis- lending and eventually rekindle in- exactly the impact on asset
tent with the aim of making banks flation. At the same time, regulators priceswhich then increase house-
more resilient. and supervisors have rightly forced hold and corporate wealththat
PUBLISHED SINCE 1889 BY DOW JONES & COMPANY There are also broader questions banks to deleverage and derisk their monetary policy is aiming at. If
Rupert Murdoch Robert Thomson to ask about financial resilience, and portfolios. This process hasnt come monetary policy doesnt affect as-
Executive Chairman, News Corp Chief Executive Officer, News Corp set prices, its hard to see where its
Gerard Baker William Lewis impact on the general price level

Notable & Quotable: Honor

Editor in Chief Chief Executive Officer and Publisher should come from.
Matthew J. Murray DOW JONES MANAGEMENT: Given surging asset prices, declin-
Deputy Editor in Chief Mark Musgrave, Chief People Officer; ing risk premiums and rising private
Edward Roussel, Innovation & Communications;
DEPUTY MANAGING EDITORS:
Anna Sedgley, Chief Operating Officer & CFO;
From a Sept. 20 White House geant Rose voluntarily exposed debt, central banks should figure out
Michael W. Miller, Senior Deputy;
Thorold Barker, Europe; Paul Beckett, Katie Vanneck-Smith, President announcement: himself to enemy fire while moving how to give more weight to financial
Washington; Andrew Dowell, Asia; OPERATING EXECUTIVES: wounded personnel to the extrac- stability in their policy strategies.
Christine Glancey, Operations; Ramin Beheshti, Product & Technology; On October 23, 2017, President tion point, loading them into heli- Their policies have successfully sta-
Jennifer J. Hicks, Digital; Jason P. Conti, General Counsel;
Neal Lipschutz, Standards; Alex Martin, News; Frank Filippo, Print Products & Services; Donald J. Trump will award the copters, and helping to repel an en- bilized the economies after the fi-
Shazna Nessa, Visuals; Ann Podd, Initiatives; Steve Grycuk, Customer Service; Medal of Honor to United States emy assault on the American nancial crisis and insulated markets
Matthew Rose, Enterprise; Kristin Heitmann, Transformation; Army Captain Gary M. Rose (re- position. As he boarded the final from various economic and political
Stephen Wisnefski, Professional News Nancy McNeill, Advertising & Corporate Sales;
Jonathan Wright, International tired) for conspicuous gallantry extraction helicopter, intense en- shocks in the past years. But the re-
Paul A. Gigot, Editor of the Editorial Page;
Daniel Henninger, Deputy Editor, Editorial Page
DJ Media Group: during the Vietnam War. . . . While emy fire hit the helicopter, causing silience of financial markets will be
Almar Latour, Publisher; his unit was engaged with a much it to crash shortly after takeoff. at risk if the balance sheets of banks
WALL STREET JOURNAL MANAGEMENT: Kenneth Breen, Commercial
Suzi Watford, Marketing and Circulation; Professional Information Business: larger force deep in enemy- Again, ignoring his own injuries, and investors in the long run again
Joseph B. Vincent, Operations; Christopher Lloyd, Head; controlled territory, then-Sergeant Sergeant Rose pulled the helicopter become exposed to overpriced assets
Larry L. Hoffman, Production Ingrid Verschuren, Deputy Head Rose repeatedly ran into the line of crew and members of his unit from and a new surge of debt.
EDITORIAL AND CORPORATE HEADQUARTERS: enemy fire. . . . the burning wreckage and provided
1211 Avenue of the Americas, New York, N.Y., 10036 On the final day of the mission, medical aid until another extraction Mr. Heise is the chief economist of
Telephone 1-800-DOWJONES
although wounded himself, Ser- helicopter arrived. Allianz SE in Munich.
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
A12 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

LIFE & ARTS

FILM REVIEW

With Ace Actors, but Not Without Its Faults

BY JOHN ANDERSON

ITS THE HIGHLY improbable

Howard Cosell, nasal twang resur-
rected on Nixon-era videotape, who
finally pulls together very enter-
taining but disparate parts of Bat-
tle of the Sexes. Directed by Val-
erie Faris and Jonathan Dayton
(Little Miss Sunshine), the film is
an extremely good-natured, upbeat
recounting of the infamous Bobby
Riggs-Billie Jean King man vs.
woman match of 1973. But it
doesnt generate much urgency, not
till the sportscaster is heard on air,
introducing Ms. King at the Hous-
ton Astrodome:
A very attractive young lady,
Cosell begins; the viewer braces
him/herself. If she ever let her
hair grow down to her shoulders
and took her glasses off, youd
have someone vying for a Holly-
wood screen test.
Oh, OK: The importance of this
rather vintage story wasnt about
equal rights, equal pay or men and
women being equals on the tennis
court. It wasnt even about Ms.
Kings coming to terms with her
FOX SEARCHLIGHT

sexuality, though thats a major

part of the movies narrative. No,
it was about the need to confront
a world in which someone with
the global exposure of a Cosell In Battle of the Sexes, Emma Stone and Steve Carell star as Billie Jean King and Bobby Riggs in the story of the infamous 1973 tennis match
could, and would, so casually ob-
jectify the top woman tennis by Riggs, the ex-champ and tennis still is his willingness to embrace the Sexes. Bill Pullman is charm- step programs.)
player in the world, and do it for a hustler for whom obnoxiousness unsympathetic roles into which he ingly oleaginous as Jack Kramer, Sarah Silverman, as the Eve Ar-
TV audience of 90 million people. was a marketing tool and who was simply disappearsthe homicidal the head of what was then the U.S. den-esque Gladys Heldman, and
Ms. King is played with what in thrall to a gambling jones that John du Pont in Foxcatcher National Lawn Tennis Association, Alan Cumming, as tennis-dress de-
might be called pluck by the ordi- threatened his marriage and, comes immediately to mind. who kicks Ms. King and her players signer Teddy Tinling, steal every
narily effervescent Emma Stone. maybe, his person. (Rumors that Watching him play the bratty out after they form the Womens scene theyre in. And Ms. Risebor-
She, like everyone involved with he threw the match to Ms. King Riggs evokes something very close Tennis Association; its fascinating ough, whose Marilyn rouses Ms.
this film, has a specific challenge because of mob debts have long to love. to watch Mr. Pullmans Kramer Kings inner lesbian, makes Ms.
on her hands: Transform a woman persisted, despite making very lit- The principals get more or less lean ever so slightly off-center Barnett a seductively winsome
who is essentially living her life tle sense, except as a lame excuse equal time en route to Houston, when Ms. King gets him on the muse. The pairs future palimony
undercover into an inspiring for his three-set trouncing.) Not but Riggs is, marginally, the more rhetorical ropes. Elisabeth Shue is suit goes unmentioned for obvious
champion of womens rights, surprisingly, directors Faris and poignant character. A late scene nothing short of regal as Riggss dramatic reasons, including the
transparency and fair play. The Dayton and screenwriter Simon with his son Larry (an affecting wife, Priscilla, whose family money fact that Ms. King would end up
story, naturally, leans the other Beaufoy (Slumdog Millionaire) Lewis Pullman) is a heartbreaking kept Riggs both well-maintained losing all her endorsements and in-
way, and the pacing doesnt help: skew matters toward a more lik- moment of sudden self-awareness: and bored, and whose attempts to curring huge legal costs at the
The build-up to Ms. Kings seduc- able Riggs, even a quasi-tragic one, The boy, moments before the King get her boy-man husband to attend time her sexuality actually went
tion by her hairdresser, Marilyn and they have the priceless asset match, declines to attend, and the Gamblers Anonymous meetings are public. The movie would much pre-
Barnett (Andrea Riseborough), of Steve Carell playing the role. It look on Riggss face is one of purely quixotic. (Youre not here fer us to believe the world was
takes so long you want to yell, deserves to be said that Mr. Carell stunned recognitionthe son is because youre gamblers, Riggs changed by a tennis match.
Just do it already! Eventually, is both a bona-fide movie star and embarrassed by the father. bellows at his fellow addicts.
they do. a marvelous actor, two things that But Mr. Carell isnt the only one Youre here because youre terri- Mr. Anderson writes on TV for the
A different problem is presented dont always go together. Rarer bringing his A game to Battle of ble gamblers!! So much for 12- Journal. Joe Morgenstern is away.

Weather The WSJ Daily Crossword | Edited by Mike Shenk

Shown are todays noon positions of weather systems and precipitation. Temperature bands are highs for the day.
-15 1 2 3 4 5 6 7 8 9 10 11 12 13 Down PUZZLE
-10
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25 5 Pamper, with
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London Brussels
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Frankfurt Prague 35 32 33 34 35 36 6 Fan mail 39 Tierra
recipient surrounded by
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9 Efficiently of Windsor
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Bucharest 44 45 46 47 48 49
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50 51 52 53 10 Lost it 43 Lush
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Madrid
d id
59 60 61 62 63 64 12 Cohort of 45 Under Cupids
Lisbon
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65 66 46 Desperately
Al i
Algiers T i
Tunis Ath
Athens
Snow 13 Mountebanks
67 68 69 medicines wanted
Flurries 15 Key figure in the 48 Kind
Rabat
b
Army-McCarthy 51 Biblical excerpt
Ice UNDERDOGS OF FILM | By Patrick Berry hearings 52 Canyonlands
Global Forecasts City
Today
Hi Lo W
Tomorrow
Hi Lo W City
Today
Hi Lo W
Tomorrow
Hi Lo W
The answer to 22 Disney film 47 Many clickbait 20 Quantum National Park
s...sunny; pc... partly cloudy; c...cloudy; sh...showers; this weeks contest featuring the articles Computer sight
Geneva 22 10 pc 22 10 pc Ottawa 26 14 s 29 16 s
t...tstorms; r...rain; sf...snow flurries; sn...snow; i...ice Hanoi 32 25 pc 32 25 t Paris 19 7 pc 20 9 pc
crossword is a film song Ill Make a 49 English throne? Services, today 53 Ledger line
Havana 31 22 pc 31 22 pc Philadelphia 28 18 pc 30 19 pc about a team of Man Out of You 50 Come apart 22 Floor protector 56 Items in a rack
Today Tomorrow Hong Kong 33 28 sh 32 28 pc Phoenix 32 19 s 30 18 s underdogs. 25 Like some
City Hi Lo W Hi Lo W 52 Stood for 23 Forget it! 57 In short order
Honolulu 30 24 s 31 23 s Pittsburgh 30 15 s 30 15 s voyages
Amsterdam 18 7 pc 18 9 pc Houston 33 22 s 33 22 pc Port-au-Prince 33 24 t 34 24 pc Across 54 White mark on a 24 Julies Doctor 58 Lay flat
Anchorage 13 10 r 13 10 r Istanbul 23 17 r 23 17 s Portland, Ore. 19 9 pc 21 10 pc 1 Kaffiyeh 27 Epiphanic horses face Zhivago role 60 Over there
Athens 26 19 s 26 19 s Jakarta 34 25 pc 34 25 c Rio de Janeiro 30 21 pc 30 21 pc wearer outburst 26 Picks up
55 Monster of 62 Computer
Atlanta 30 20 pc 29 19 pc Johannesburg 28 14 s 30 11 s Riyadh 41 22 s 39 23 s
5 Performed 28 Pastry exterior 28 Fifty Shades of language named
Baghdad 40 25 s 40 23 s Kansas City 31 21 s 30 19 s Rome 23 13 s 24 13 pc Norse legend
31 Parker of Grey surname for a female
Baltimore 28 16 s 29 17 s Las Vegas 25 15 s 25 16 s Salt Lake City 13 5 sh 14 6 sh 8 Small torpedo 59 Emma who
Bangkok 32 25 t 31 25 t Lima 19 16 pc 19 16 pc San Diego 23 17 pc 23 17 pc Daniel Boone 29 Experiences mathematician
launcher births Berthe
Beijing 28 12 s 28 17 pc London 18 12 pc 19 11 pc San Francisco 22 13 s 24 14 s 32 Filing aid 30 Masthead names 63 Maradonas
Berlin 17 7 pc 18 11 r Los Angeles 24 15 s 25 15 s San Juan 31 27 sh 32 27 sh 14 Youre supposed 61 Beside oneself
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Bogota 20 9 r 20 9 r Madrid 28 14 t 28 14 s Santiago 23 9 s 24 10 pc to build up to it 65 Exceedingly
Australias coat spreads 64 Startled cry
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Sao Paulo 30 19 pc 32 17 s of arms 66 Chef seen on
Boston 18 15 c 20 17 pc Melbourne 23 16 c 26 13 pc
Brussels 18 6 pc 18 8 pc Mexico City 23 15 pc 23 15 pc Seattle 19 9 pc 20 11 c 17 In direct 37 Messianic figure shelves
Previous Puzzles Solution
Buenos Aires 18 6 pc 21 9 s Miami 32 26 pc 32 25 t Seoul 27 16 pc 27 15 s confrontation to Rastafarians 67 Betray H O H UM O T T O T OM B
Cairo 34 22 s 31 21 s Milan 24 12 c 24 14 pc Shanghai 26 22 c 24 23 t 18 El Greco, for one 41 Coleridges embarrassment A R OMA MO H R I N R E
Calgary 6 -1 sf 12 -1 pc Minneapolis 32 22 s 28 21 t Singapore 31 26 t 31 25 c V A M P I R E T A B M E S S
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Charlotte 31 19 pc 32 18 pc Montreal 25 14 s 27 17 s Sydney 28 17 pc 33 22 s Geena 42 Fills to excess (Hostess snack) N O E L F A L L OWR E E D
A R S O N L I E T E E
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Email your answerin the subject lineto [email protected]
s

Denver 29 9 pc 17 6 t Nashville 32 20 s 32 19 pc Tel Aviv 30 23 s 28 21 s A S H U L N A F E D

Detroit 30 17 s 30 17 s New Delhi 29 24 t 28 23 t Tokyo 26 21 c 25 20 c R H O S E T D A N E S
by 11:59 p.m. Eastern Time Sunday, Sept. 24. A solver selected at random T I M B E R F L O W MO U E
Dubai 41 31 s 39 29 s New Orleans 33 24 pc 32 23 t Toronto 27 15 s 29 17 s
Dublin 17 9 r 17 12 c New York City 26 19 pc 28 20 pc Vancouver 18 8 pc 17 9 c
will win a WSJ mug. Last weeks winner: Will Irving, Pennington, NJ. S M E A R A L L A H U R N
A M I S P R A I R I E G O D
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TECHNOLOGY: EU READIES NEW TAXES ON DIGITAL COMPANIES B4

BUSINESS & FINANCE

2017 Dow Jones & Company. All Rights Reserved. THE WALL STREET JOURNAL. Friday - Sunday, September 22 - 24, 2017 | B1

Euro vs. Dollar 1.1939 0.37% FTSE 100 7263.90 g 0.11% Gold 1290.60 g 1.63% WTI crude 50.55 g 0.28% German Bund yield 0.456% 10-Year Treasury yield 2.278%

SoftBanks Uber Deal Hits Snag Mexico

Investor Benchmark
signals it wont sell
$93 billion tech-focused Vi-
sion Fund, along with part-
pushing to ensure the deal re-
sults in more independent
the terms said.
That would risk devaluing
termined then.
Benchmarks stance could
Shows
ners, to buy 17% to 22% of board seats and additional
its stake to support
the groups proposal
Ubermostly through pur-
chasing shares from existing
shareholders.
rights for all shareholders, in-
cluding broader voting power,
according to people familiar
whatever equity shareholders
dont sell to SoftBank. To try
to assuage those concerns,
SoftBank also has proposed
put a chill on other stakehold-
ers who might otherwise view
the SoftBank deal as a rare
opportunity to cash in. Uber
Risks of
BY GREG BENSINGER
Benchmark has told fellow
investors it is unlikely to sell
any of its 13% holding to the
with the matter.
Benchmark, along with a
few other early investors,
directly investing at least $1
billion into Uber at roughly
the $70 billion valuation as
has generally restricted inves-
tors from such so-called sec-
ondary share sales.
Disaster
As Uber Technologies Inc. SoftBank consortium, accord- holds outsize voting power part of the deal, the people Travis Kalanick, the Uber
works to nail down a multibil-
lion-dollar investment from
Japans SoftBank Group
ing to people familiar with the
matter. Benchmarks represen-
tative on Ubers board, Matt
relative to its stake.
The proposed investment
by the SoftBank group, which
said. In addition to the stake,
SoftBank is seeking two
board seats.
co-founder who was pushed
out as chief executive in June
under pressure from Bench-
Bonds
Corp., one of the ride-hailing Cohler, was the only one of could total as much as $10 bil- The Wall Street Journal re- mark, also is unlikely to sell BY ANUPREETA DAS
giants earliest and biggest Ubers eight directors to vote lion, hinges on getting enough ported last week that resis- any of his approximately 10%
shareholders has indicated it against a term sheet granting existing investors to sell their tance from some investors stake, according to people fa- Investors recently bought a
doesnt intend to sell. SoftBank exclusive rights to shares at what amounts to a was impeding the SoftBank miliar with the matter. catastrophe bond designed to
The opposition by Bench- an investment deal, the peo- 30% discount to Ubers most deal talks. That means that roughly minimize the financial hit to
mark Capital is complicating ple said. recent valuation of nearly $70 But Benchmarks position one-quarter of Uber shares the Mexican government from
a proposal by SoftBank and its The venture firm has been billion, people familiar with on the matter couldnt be de- Please see UBER page B2 earthquakes. They could now
be on the hook for as much as
$150 million after two major
STREETWISE quakes struck the country in
quick succession.
By James Mackintosh
Already popular with insur-
ance companies as a way to

$2 Trillion transfer some risk to the

global capital markets, cat
bonds and other financial

Later, We products have also been ad-

opted by countries to protect
public coffers from large-scale

Are Left
natural disasters.
Big investors such as pen-
sion funds have lapped up cat
bonds because they earn high

Wondering rates of interest and returns

are uncorrelated to, or inde-
pendent from, market down-
After turns. Cat-bond investors can
spending $2 lose some or all of their prin-
trillion on cipal if a specified disaster
government occurs and an issuer has to
bonds in an pay claims.
effort to stim- Mexico, which is highly vul-
ulate the economy, the Fed- nerable to storms, earth-
eral Reserve can hardly ad- quakes, floods and other disas-
mit that it doesnt know ters, is a pioneer among
how, or even if, it worked. countries in the use of cat
MATT STANLEY FOR THE WALL STREET JOURNAL

Fed Chairwoman Janet bonds. Since 2006, it has

Yellen on Wednesday came raised more than $1 billion
as close as she is ever likely from investors to help finance
to get to accepting that rescue and rebuilding efforts,
quantitative easing is still although not all of the bonds
poorly understood, even by have paid out.
the experts. Explaining why In August, the Mexican gov-
the central bank prefers to ernment tapped the capital
set short-term rates rather markets via a World Bank-is-
than buy or sell stuff, she sued cat bond that buys up to
said it was because we be- $360 million of cover against
lieve we understand pretty disasters, including as much as
well what the effects [of rate A UPS recruiting event in Pennsylvania this week. Package-delivery services have been adding to the hiring frenzy in the U.S. $150 million from earthquakes.
changes] are on the econ- Catastrophe bonds were de-

Retailers Ring In Holiday Hiring

omy, and so do investors. veloped by the insurance in-
Left unsaid: No ones really dustry in the 1990s as a way to
sure how, or if, QE works. spread risk to financial mar-
This matters enormously kets. An investor, say an en-
to investors as the Fed sets BY JENNIFER SMITH near-record lows, employers jumped 13% in November and dowment, family office or pen-
out on quantitative tighten- Season's Greetings are going the extra mile to en- December, compared with a sion fund, buys the bond,
ing. Its starting small, al- Shoppers like to complain sure they have enough work- 7% decline at department taking into account calcula-
lowing a maximum of $10 that holiday decorations ap- ers come December. Compa- stores, according to the Na- tions by an independent risk-
billion of bonds a month to pear earlier and earlier. This nies are bumping up pay, tional Retail Federation. modeling firm of the odds of a
mature without the money year, so are the job ads. loosening disciplinary policies Wal-Mart Stores Inc. plans specified disaster occurring.
being reinvested. But in a The holiday hiring binge is and even operating bus routes. to bring on about 5,000 sea- The principal and interest are
year, that will be up to $50 accelerating for retailers such Its the tightest labor mar- sonal workers for its e-com- held in escrow and typically
billion a month, more than as Target Corp. and Macys ket weve ever seen, said Sean merce operations. The dis- invested in Treasurys.
the Fed bought each month Inc., which add thousands of McCartney, executive vice counter isnt hiring extra help at These bonds are usually
during the first phase of workers to process surging president of operation services its stores, where it plans to give sold in tranches, each with a
QE3 in 2013. online orders. E-commerce at Radial, which handles online existing employees more hours. different trigger. Some trig-
The basic investor belief sites double or even quadruple orders for e-commerce compa- Macys plans to add 18,000 gers are based on metrics tied
about QE is simple: It makes their warehouse staff. Online nies and national chains such seasonal workers at distribu- to a weather event, some are
bond yields go down, shares giant Amazon.com Inc. adds as Dicks Sporting Goods Inc. tion centers that replenish tied to a single event, while
go up and the currency go to the hiring frenzy, as do lo- and Aropostale Inc. store merchandise and fulfill others reference damage ac-
down. All make intuitive gistics companies and pack- Some big retailers are do- online ordersa 20% boost cumulated over designated
sense. Buying more bonds age-delivery services such as ing the bulk of their hiring in compared with last year. Over- periods. For taking on the
pushes up their price (so, re- United Parcel Service Inc. warehouses that handle online all seasonal hiring is down risk, investors are paid inter-
ducing yield). Those who and FedEx Corp. Some firms orders, a sign they expect slightly at the retailer, which est at rates comparable to
sold bonds have to redeploy posted their first holiday job more shoppers to visit their closed dozens of stores after high-yield bonds.
their money and so buy listings as early as July. websites instead of stores. disappointing sales in 2016. The insurance industry,
Please see STREET page B2 But with unemployment at Last year, online retail sales Please see HIRE page B2 Please see BONDS page B2

LOral Heiress, the Worlds Richest Woman, Dies INSIDE

BY MATTHEW DALTON behalf of our family, our entire courts guardian. Mr. Banier
commitment and loyalty to denied any wrongdoing.
PARISLiliane Betten- LOral and to renew my confi- During the trial, 21 hours of
courtwho presided over the dence in its President Jean- secret tape recordings made
LOral cosmetics fortune, be- Paul Agon and his teams by Ms. Bettencourts butler
coming the worlds richest world-wide. came to light in which she and
womandied on Thursday af- Ms. Bettencourt amassed her financial adviser, Patrice
ter spending decades under one of Frances biggest for- de Maistre, alluded to offshore

LILIANE
the spot-
light for
tunes while overseeing
LOreals rise from a family
accounts. The two also discuss
possible donations to Eric Wo-
HUFFPOST
HORST OSSINGER/AFP/GETTY IMAGES

BETTENCOURT her ties to makeup company to a globe- erth, who was Mr. Sarkozys CHAMPIONS
1922-2017 powerful
politicians
spanning colossus. Forbes esti-
mates her net worth at $44
labor minister.
Ms. Bettencourt opposed
NEW MISSION
and her billion. her daughters effort to place
role in a bitter family feud. She Born Liliane Schueller in her under guardianship, with BUSINESS, B3
was 94 years old. Paris, she was the daughter of her legal team arguing that
My mother has left peace- Eugne Schueller, one of the she was happy to be generous
fully, said Franoise Betten- founders of LOral. with Mr. Banier.
court-Meyers, her daughter. Ms. Bettencourt kept out of But the secret recordings
In announcing the death, the day-to-day operations of Ms. Bettencourt amassed one of Frances biggest fortunes. give a different impression. In
Ms. Bettencourt-Meyers of- LOral. However, she guided them, the daughter of the
fered assurances that LOral one of its more important Ms. Bettencourt was best gifts on Franois-Marie Banier, founder LOral seems con-
SA, the worlds biggest cos- transactions: the 1974 sale of a known internationally for the 63, a socialite photographer fused and frail. At various
metics company, remained in large stake in LOral to the Bettencourt affair: A family and friend, totaling more than points in the recordings, Ms.
steady hands with Chief Exec- Swiss consumer-goods giant dispute over her relationship 1 billion ($1.19 billion), ac- Bettencourt doesnt recall hav-
utive Jean-Paul Agon. Ms.
Bettencourt-Meyers controls
Nestl SA. Ms. Bettencourt or-
chestrated the move to fend
with a male friend that broad-
ened into a financial scandal
cording to a lawsuit filed by
Ms. Bettencourt-Meyers
ing made Mr. Banier the sole
beneficiary of her estate, ex-
AIA ACQUIRES
33% of LOral along with her off a feared nationalization of touching the inner circle of against Mr. Banier. Her daugh- cluding her stake in LOral, INSURANCE
sons as guardian of her
mothers assets.
LOral by the French state.
Nestl now owns 23% of
former French President Nico-
las Sarkozy.
ter accused Mr. Banier of ex-
ploiting her mothers mental
which she already had given to
her daughter. Neither does she
BUSINESS
In this painful moment for LOral. Late in life, Ms. Bettencourt weakness and asked the court recall giving him a private is-
us, I would like to reiterate, on Toward the end of her life, began lavishing money and to name her as Ms. Betten- land in the Seychelles. FINANCE & MARKETS, B5
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 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

INDEX TO BUSINESSES BUSINESS & FINANCE

These indexes cite notable references to most parent companies and businesspeople
in todays edition. Articles on regional page inserts arent cited in these indexes.

A
AIA Group ................... B5
Aldi..............................A1
F
Facebook......................B4
FedEx...........................B1
R
Randstad Holding.......B2
Rosneft ....................... A3
STREET The QE Effect
During the three main periods of Federal Reserve bond-buying, both
Treasury yields and shares rose and the dollar was mixed.
stocks and junk bonds. Re-
versing QE is thus likely to
have less effect now than it
would if markets were in
Alibaba Group Holding FireEye ........................ B5 S Continued from the prior page turmoil.
.....................................B4 G SoftBank Group..........B1 shares, while the combina- S&P 500 The natural assessment,
Alphabet......................B4 General Mills .............. A1 Sterilized QE
Amazon.com..........B1,B3 T tion of lower yields and 2500 then, is that the Fed reduc-
General Motors...........B8
Australia & New Target..........................B1 money creation weakens the QE1 QE2 QE3 ing Treasury holdings will
GrabTaxi Holdings.......B2
Tencent Holdings........B4 2000
Zealand Banking Group currency. On top of this proper push up yields, but not by
H Tesla............................B4
.....................................B5 portfolio balance effect, 1500 much. For one to think that
Home Depot................B2 Twitter ........................ B4
B theres a signaling effect, be- yields will fall would require
Huobi...........................B5 U 1000
Baidu ........................... B4
I cause QE suggests no rate a belief that the economy
Barclays.......................B2 Uber Technologies ...... B1
increases for a long time. 500 wont be able to cope with
Benchmark..................B1 Inditex.........................B2 UniCredit.....................B8
United Parcel Service.B1 One might then assume 0 the tightening at a time
Bitkan..........................B5 J-L
BNP Paribas................B8 V that reversing QE will mean 2009 10 11 12 13 14 15 16 17 when it seems to be doing
Johnson Matthey........B8
the opposite: Bond yields fine, if not spectacularly
C L'Oral.........................B1 Verizon Communications
.....................................B3 rise, shares fall and the dol- well. Further, we cant be
Commerzbank ............. B8 M-N Yield on 10-year Treasury note
Commonwealth Bank of Volkswagen.................B8 lar strengthens. There are at sure that QE had much, or
Macy's.........................B1 4%
Australia...................B5 Navistar InternationalB4
Volvo............................B4 least three reasons not to any, effect on growth and in-
Sept. 21, 2011
Cummins ..................... B4 Novatek.......................A3 W worry too much about this Operation Twist flation. Studies mostly find a
3
CVS Health..................B3 O-P Wal-Mart Stores.........B1 happening and one good rea- announced noticeable impact, but teas-
D-E Occidental Petroleum.B8
Whole Foods...............B3 son to be concerned. 2 ing out how much of that
Daimler........................B4 OKCoin.........................B5 X First, economists vary was really down to QE re-
Equifax...................A1,B5 Paccar..........................B4 XPO Logistics..............B2 widely in their assessment of 1 Aug. 27, 2010 quires too many assumptions
the size of the impact on Ben Bernanke Dec. 18, 2013 to be reliable. As Claudio Bo-
bond yields, but it isnt 0 hints QE2 possible Taper announced rio and Anna Zabai of the
INDEX TO PEOPLE nearly as big as one might
expect. Studies suggest the
2009 10 11 12 13 14 15 16 17 Bank for International Set-
tlements put it in a paper
effect of the $600 billion of ICE Dollar Index last year, these results gen-
B J S Treasurys bought in QE2 100 erally have to be taken with
Bettencourt, Liliane....B1 Jacobowitz, Jay .......... B3 Sandberg, Sheryl ........ B4 was a drop in the 10-year more than a pinch of salt.
Borio, Claudio..............B2
K Spring, Annabel..........B5 Treasury yield of between 90 Stock markets tend to
Brennan, Troyen..........B3 W 0.16 percentage point and tumble when bond yields fall
Khosrowshahi, Dara ... B2 0.45 percentage point, with because of economic con-
C Walker, Cynthia .......... B8
M big margins of error. To put 80 cerns, and they tend to be
Cusson, Jim.................B3 Wieladek, Tomasz ...... B2
that in context, yields have less upset when yields go up,
D Mezger, Jeffrey...........B2 Wittner, Michael.........B8
Moscovici, Pierre ........ B4
risen 0.23 point in the past 70 although usually the reason
Dukes, R.T...................B8 Z two weeks alone. for a yield rise is faster
P 2009 10 11 12 13 14 15 16 17
E Zabai, Anna.................B2 Second, common sense growth, which shareholders
Ellis, David..................B5 Polgreen, Lydia ........... B3 Zhang, Shouchun........B4 makes the measures doubt- Sources: Thomson Reuters Datastream (indexes, yield); Federal Reserve (dates) like, not tighter monetary
ful. One way economists THE WALL STREET JOURNAL. policy. So its plausible that
come up with estimates is to even if the reverse of QE

BONDS bonds followed in 2009 and

2012 arranged by a World
Bank facility. Only the 2012
bond was partly triggered by
look at price moves on days
when news about QE was re-
vealed, which is fair enough.
But the same days that bond
markets have a similar de-
layed reaction to the end of
QE, can we be sure which di-
rection bond yields will
Effects on investor senti-
ment are likely to be bigger
when sentiment is deeply de-
pressed, too. A study by
does push up bond yields,
shareholders wont be that
bothered.
Theres a good reason for
Continued from the prior page Hurricane Patricia in 2015, a yields fell, stock prices often move? Bank of England staff and investors to worry, however.
along with international or- bank spokeswoman said. Mex- fell, too, the opposite of the Third, the effects of QE Tomasz Wieladek of Barclays At the moment, the one
ganizations such as the World ico received $50 million, or usual story about QE. To clearly depend on whats go- PLC last year found QE had measure on which U.S.
Bank, has increasingly pro- half the principal amount of make matters worse, look at ing on in markets at the double the effect on U.S. eco- stocks dont look expensive
moted the use of capital-mar- one class of the bond that cov- the period as a whole, and time. Every study finds a nomic growth during the is when theyre compared
kets instruments for develop- ered Pacific Ocean storms. during QE1, QE2 and QE3, bigger impact from crisis-era panic period than later QE with bond yields. If a rise in
ing countries that financially The country tapped inves- bond yields went up, along QE than from the later ver- rounds. yields removes that advan-
struggle to cope with the fall- tors for the fourth time a few with stock prices, while the sions, as would be expected. At the moment, markets tage, it takes away the only
out from calamities. weeks ago through a cat bond dollar was mixed, plausibly a Central bank intervention are functioning perfectly valuation support for U.S.
The World Bank works with issued by the World Bank. The sign that QE had worked and helped fix dysfunctional well and sentiment if any- shares, making it even
developing countries to create $360 million bond is divided boosted expectations of markets, so it played a role thing is too positive, judging harder to justify buying at
financial products, including into three classes, each provid- growth and inflation. If the beyond merely buying bonds. by high valuations for U.S. highs.
cat bonds and derivatives, ing protection from a different
meant to protect public bud- kind of disasterearthquakes,

Catastrophe bonds
Pacific hurricanes and Atlantic
hurricanes.
On Sept. 7, an 8.1-magnitude
quake struck southern Mexico,
UBER following an initial public of-
fering, as has happened after
some tech firms went public
recently. New Uber CEO Dara
The suit divided Uber di-
rectors, many of whom were
surprised when Benchmark
filed it in early August.
hailing firms. And it already
has directors on the boards of
ANI Technologies Pvt.s Ola
and GrabTaxi Holdings Pte.,
have been adopted killing nearly 100 people in Continued from the prior page Khosrowshahi has said the Mr. Kalanick argued in which compete with Uber di-
Chiapas and Oaxaca states. would be unavailable to Soft- company could go public in as court papers that the suit is a rectly in India and Singapore
by countries to The second earthquake hit on Bank, which has teamed up little as 18 months. meritless, personal attack. and Southeast Asia, respec-
protect public coffers. Tuesday, causing more than with Dragoneer Investment But San Francisco-based For SoftBank, a deal with tively.
200 deaths and significant Group and private-equity firm Benchmark said in August it Uber would give it a stake in Mayumi Negishi
damage including in Mexico General Atlantic for the pro- believed Ubers valuation all of the largest global ride- contributed to this article.
City. posed investment. could eventually top $100 bil-
gets from the costs of natural The maximum potential Two directors, chairman lion.
disasters. In the past decade, payout from the earthquake- and co-founder Garrett Camp Other investors have pri-
the institution has executed class of the bond is $150 mil- and early employee Ryan vately cited that lofty expecta-
$2.5 billion in transactions lion, the principal amount. Graves, are expected to sell at tion as a reason they may not
covering droughts in Malawi, Bond buyers will lose their least some of their stake to sell to SoftBank in the tender
typhoons in the Philippines principal if the earthquakes SoftBank, according to the offering.
and hurricanes in the Carib- meet certain criteria for sever- people familiar with the mat- Some people close to the
bean, among others. In the ity, depth and location. Nearly ter. deal talks cautioned it was
U.S., public entities such as the half of the earthquake-class For most venture-capital possible they could fall apart
California Earthquake Author- bond buyers are based in firms, Benchmarks return on entirely.
SETH WENIG/ASSOCIATED PRESS

ity and New Yorks Metropoli- Western Europe, and more its Uber holdings is the stuff Benchmark has proved it-
tan Transportation Authority than three-quarters of the of dreams, even at a discount. self an unpredictable investor.
have also issued cat bonds. buyers are specialist funds Its investment of $27 million It sued Mr. Kalanick weeks af-
Mexico turned to cat bonds that invest in cat bonds and six years ago is worth about ter helping oust him, saying
in 2006 when it bought $160 other insurance-linked securi- $8.4 billion on paper today, he reneged on an agreement
million in protection against ties. according to other investors. to return to board oversight
losses from earthquakes Leslie Scism Selling some of that could three board seats he controls.
through a three-year cat bond and Nicole Friedman shelter Benchmark from the The suit is being sent to pri-
called CatMex. Two other contributed to this article. risk of a drop in Ubers stock vate arbitration. SoftBank has proposed directly investing $1 billion into Uber.

HIRE
ADVERTISEMENT
ing between $11 to $14 an hour Randstad Holding NV.
The Mart for full-time warehouse work-
ers, depending on the location.
This year average pay for
entry-level warehouse workers
Continued from the prior page In Cranbury Township, a is expected to hit $13.68 an
BUSINESS OPPORTUNITY Radial is bringing on 27,000- New Jersey town near Inter- hour during peak season, up
plus seasonal workers, 35% state 95, help-wanted ads for 10% compared with nonpeak
more than last year. The com- warehouse workers are posted wages, and a nearly 5% increase
 
 "#"$  #
#  %##" pany began advertising for some along roads and at local busi- from 2016, according to logis-
jobs in July, about a month ear- nesses. Amazon is opening a tics-staffing firm ProLogistix.
           ! lier than usual. Its offering more 900,000-square-foot fulfill- UPS began recruiting a few
flexible schedules, including ment center there, joining weeks earlier than usual and is
  shorter shifts that allow work- nearby facilities serving Way- providing bus service for sea-


ing parents to clock in between fair.com, Home Depot Inc., sonal workers in markets such



  


school drop-off and pickup. Petco Animal Supplies Inc. and as Chicago, Boston, Seattle,


XPO Logistics Inc., whose Crate and Barrel, among oth- and Louisville, Ky., where la-


  !" #$"!!% & e-commerce clients include In- ers. Its your time, Cranbury, bor competition is particularly


 "'(  )*%   ditex SAs Zara, plans to add NJ, reads one Amazon flier. tight, said Paul Tanguay, the


6,000 seasonal workers, up Amazon hasnt announced companys global director of



 
     20% from last year. its seasonal hiring plans. Last recruitment strategies.
    
  Companies are racing to month, the company held a The company plans to add
    open warehouses within easy nationwide job fair in the U.S. 95,000 seasonal workers, about
reach of millions of consumers to fill 50,000 positions, mostly the same level as the previous
       who expect to get e-commerce at fulfillment centers. two years, for positions from
    orders in two days or less. This I dont think its a coinci- package handlers to drivers
  
   
! year, Amazon alone announced dence that the nationwide hire who run big-rigs loaded with
 plans for more than two dozen day coincided with the extreme packages from one facility to
new U.S. fulfillment centers. front-end of peak-season hir- another. FedEx expects to hire
 "    #$ % &$ $ Amazons arrival can shake ing, said Doug Hammond, exec- more than 50,000 for the peak,
 
! '()*  '"* up local warehouse labor mar- utive vice president of in-house close to last years total.
 + ,   
  kets because the retailer often services for Randstad US, a sub- Suzanne Kapner
pays better than rivals, offer- sidiary of Dutch recruiting firm contributed to this article.
 - 



 
    
BUSINESS WATCH



 + '"&"+ &# 




""# *!" ,*# DAIMLER assembly facility in China. The cording surfaced this week pur-
company intends to offer more portedly of the CEO berating his
  
    Big Investment Set than 50 fully or partly electric neighbor, comedian Kathy Griffin,
 
     !  "#$%& '
 ()# *%+,& &#% % #%  -./01  2220/01 For Alabama Plant vehicles globally, and by 2022 in an expletive-laced tirade.
offer electrified options for its On a more than two-minute
Daimler AG said Thursday it entire Mercedes-brand lineup. recording published by HuffPost,
ANNOUNCEMENTS BUSINESS OPPORTUNITY TRAVEL will invest $1 billion in its Tusca- Chester Dawson Jeffrey Mezger castigates Ms.
loosa, Ala., manufacturing opera- Griffin and her boyfriend for
 

 tions and start production at the KB HOME having called the police to com-
As with all investments, Save Up To 60% plant of a fully electric sport-util- plain about noise coming from

    
       appropriate advice should First & Business ity vehicle. Home Builder Slices his house, where his grandchil-


   INTERNATIONAL
    

 be obtained prior to Major Airlines, Corporate Travel
The German auto makers ex- CEOs Bonus by 25% dren were using his pool.
       
entering into any Never Fly Coach Again! pansion in the U.S. is part of its Mr. Mezger didnt immedi-
  !"    global push into electric vehicles Home builder KB Home said ately respond to a request for
www.cooktravel.net
   
 #$ 
   %    

binding contract. (800) 435-8776 and follows its announcement in it would cut its chief executives comment.
July of plans to build a battery- annual bonus by 25% after a re- Cara Lombardo
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. Friday - Sunday, September 22 - 24, 2017 | B3

BUSINESS NEWS

CVS Health to Limit Access to Opioids

Drug-benefit manager it would limit opioid prescrip- CVS-covered patients arrive at some debate. One addiction or about 28% of the U.S. popu- painkillers, and often pro-
tions to seven days or less for the pharmacy with a prescrip- expert said even stricter limits lation, through its Caremark gressed to heroin and other
will restrict painkillers certain patients with acute tion above the new limits, the would better reflect CDC ad- unit. It also runs 9,700 retail street drugs.
for certain patients to pain who havent previously pharmacy will kick it back to vice, while a physician and as- pharmacies nationwide. CVS and other health-care
taken an opioid painkiller. the doctor for review, Dr. sociate professor of medicine The overarching reason companies have faced accusa-
seven days or less That will be a big change, Brennan said. at University of Pittsburgh for the limits is to reduce the tions of helping fuel the crisis
given that many CVS-covered There will be ways around said the restrictions for amount of human suffering through their handling of opi-
BY JEANNE WHALEN patients with acute pain re- the rulesdoctors will be able chronic pain in particular that results from people being oid painkillers. Last year, CVS
ceive opioid prescriptions for to appeal the limits through could cause cumbersome pa- addicted to these medica- paid $3.5 million to settle fed-
One of the largest managers 20 days or more, Troyen Bren- the prior-authorization pro- perwork and delays. The tions, Dr. Brennan said. The eral allegations that 50 of its
of pharmaceutical benefits in nan, CVSs chief medical offi- cess, and employers and insur- guidelines that CDC put out new rules could also bring pharmacies in Massachusetts
the U.S. says it will start limit- cer, said in an interview. ers will be able to opt out of were for prescribers to try to cost savings for employers and and New Hampshire filled
ing the duration and dose of CVS will also limit patients the limits if they dont want avoid those doses. They were insurers if they prevent some forged prescriptions for pain-
some prescriptions for opioid with chronic pain to a maxi- them to apply to their pa- not meant for payers to say patients from becoming ad- killers and other controlled
painkillers, in an effort to mum daily dose of 90 mor- tients. were not going to fill some- dicted, he said. substances.
combat widespread addiction. phine milligram equivalents, The restrictions, which CVS thing if its above that limit, Widespread opioid addic- The company said it has
CVS Health Corp., which or MMEs, a standard unit of said it based on Centers for said Walid Gellad, the Univer- tion has pushed U.S. overdose implemented enhanced poli-
administers drug benefits for measure in pain medicine, Dr. Disease Control and Preven- sity of Pittsburgh physician. death rates to new highs. cies to help its pharmacists
employers, insurers and some Brennan said. tion recommendations pub- CVS manages medications Many Americans became ad- determine whether prescrip-
state Medicaid programs, said Starting in February, if lished last year, could cause for nearly 90 million people, dicted by taking prescription tions are legitimate.

The Trump Effect

While some news sites enjoyed major audience gains during the
Impax,
past two years, others such as HuffPost didnt.
Percentage change in unique site visitors from August 2015 Amneal
Nov. 8, 2016 Election day
100%

80 Feb. 1, 2016
Primary season begins. Washington Post*
In Merger
60

40
New York Times*
Talks
20 Wall Street Journal* BY DANA CIMILLUCA
USA TODAY AND JONATHAN D. ROCKOFF
0
BuzzFeed
Impax Laboratories Inc. is
20
HuffPost in talks to combine with rival
2015 2016 2017 Amneal Pharmaceuticals LLC

EMMA MCINTYRE/GETTY IMAGES

as the companies seek to build
Unique visitors for August 2017, in millions strength in a challenging mar-
ket for generic-drug makers.
Impax and closely held Am-
100.1 97.7 92.4 73.9 neal are in talks that could
66.4
28.2 yield a transaction next
month, assuming they dont
Note: Chart reects select major news sites *Sites sell digital subscriptions fall apart, according to people
Source: comScore THE WALL STREET JOURNAL. Lydia Polgreen, editor in chief at HuffPost, has been working to redefine the mission of the site. familiar with the matter.
Terms couldnt be learned, but

HuffPost Pursues Anti-Elitist Rebranding

Impax had a market value of
about $1.6 billion Thursday
morning before The Wall
Street Journal reported on the
BY LUKAS I. ALPERT cuss issues of concern in St. click-bait-driven, liberal coun- 100 million additional viewers room layoff. HuffPosts Wash- possible deal, meaning a take-
Louis, like policing and race terpoint to sites such as the from outside the U.S. each ington, D.C., bureau bore a over could value it at roughly
ST. LOUISWith the famed relations. Drudge Report has paid fewer month. heavy brunt of the layoffs. $2 billion or more.
Gateway Arch overhead, Lydia The effort comes at a piv- dividends in recent years as Ms. Polgreen, a veteran for- Other staffers have strug- Impax and Amneal, which
Polgreen bounded on stage otal time for HuffPost, which readers increasingly find news eign correspondent who came gled to understand why the have offices in the same New
last week to open a 25-city is trying to reignite growth through social media. on board at the Huffington brand needed fine-tuning in Jersey suburb of Bridgewater,
Listen to America tour to and forge an identity separate No longer does gaming Post after nearly 15 years at the first place. have been trying to carve out
help promote a redefined mis- from that of its founder, Ari- SEO win the day and building the New York Times, oversaw We have always been for profitable niches selling ge-
sion for the 12-year-old web- anna Huffington, whose per- scale mean a sustainable busi- the rebranding and has tried struggling middle-class voters. neric drugs at a time when the
site formerly known as the sona and interests largely per- ness model, Ms. Polgreen said to reposition the site as a Populist issues have always industry is facing pricing pres-
Huffington Post. meated the site until her in an interview in July. To more populist tabloid that can been HuffPost issues, one re- sure that is squeezing profits.
Since taking over in Janu- departure a year ago. It also succeed now requires deeply forge an enduring connection cently departed staffer said. A deal between the two
ary as editor in chief, Ms. Pol- comes amid the backdrop of a sustained engagement with with readers. This search for a new identity companies would be the latest
green has tried to push the major corporate shuffle and your audience. In the past, the brand has been confusing for every- example of industry executives
progressive-leaning news out- cost-cutting effort by owner In 2014, HuffPost regularly identity was very liberal pro- one. figuring that a combination
let out of its comfort zone and Verizon Communications recorded well over 100 million gressive, but I see us as really Among Ms. Polgreens first will produce economies of
zero in on stories that might Inc., which has been working unique visitors a month in the reflecting an audience that steps was to redesign the site scale that can widen margins
resonate as much with factory to merge HuffPosts parent U.S., but that figure slid into feels left out, she said. So and push for stories that take and lift profits, as well as push
workers as with hipster city company, AOL, with Yahoo. the high 70 million-to-low-80 many news organizations al- a critical look at people in back against the increasingly
folk. The goal of the tour is to While the site historically has million range by 2016, accord- ready go after elite audi- power, regardless of party, like powerful buyers of the copycat
find out what people across commanded large audiences, it ing to comScore Inc. Even dur- ences. one that took former President medicines. Yet the jury is still
the country care about and to hasnt been consistently prof- ing last years election and its Ms. Polgreen came up with Barack Obama to task for out on whether the sectors
incorporate more of that into itable. aftermath, when interest from the idea for the six-week bus agreeing to deliver a $400,000 consolidation will pay off.
coverage at HuffPost, as the HuffPost rose to the top of liberal readers drove a tour to determine what read- speech on health care to Wall In April, German health-
site is now rebranded. the digital news heap after its Trump bump at other news ers between the coasts are in- Street firm Cantor Fitzgerald. care company Fresenius SE &
Too often you have the 2005 launch, partly through sites, HuffPosts U.S. audience terested in. She also has emphasized Co. KGaA agreed to buy U.S.
media say this is whats im- its pioneering expertise in has remained mostly stagnant. But the trip has become an zippier headlines for the site generic-drug manufacturer
portant, this is what matters, what is known as search-en- Last month, the site had issue of discontent among like Sean with the Wind,
but we want to hear what you gine optimizationpublishing 66.4 million unique U.S. visi- some staffers who bristled at marking White House press
think. We want to give you the tactics that ensure high place- tors. HuffPost also operates its reported $1 million price secretary Sean Spicers exit in
mic, she said, before inviting ment in online search results. several international editions tag when it was announced Julyto channel the sites tab-
The generic-drug
civic leaders onstage to dis- But the sites approach as a and typically attracts around shortly after a sizable news- loid spirit. industry faces pricing
pressure that is
squeezing profits.
Whole Foods Moves Toward Grocery Mainstream
BY HEATHER HADDON ports show traffic improvement third-party providers, and that Akorn Inc. for $4.3 billion. In
AND ANNIE GASPARRO since the deal closed last this arrangement could pro- 2016, Teva Pharmaceutical In-
month, likely because the chain duce better results. Whole dustries Ltd. bought Allergan
Whole Foods will change lowered prices on key items Foods staff will know each PLCs generic-drug business
the way companies can sell and such as eggs and milk. other and the brands. Youd ex- for $40 billion. But the debt
market their products in its Whole Foods share of the pect higher service because of accumulated from that and
stores beginning next year, one U.S. grocery market jumped by this, said Greg Fleishman, a other deals has hobbled Teva.
of the biggest moves yet in its upward of 16% week-over-week natural-foods consultant at Impax, based in Hayward,
push to operate more like a tra- in the first three days after the Purely Righteous Brands. Calif., is led by Paul Bisaro, an
ditional market. Aug. 28 price cuts, but is now A Whole Foods spokes- Allergan board member and
Under the changes planned trending up by more-modest woman said having brand advo- former chief executive at one
for April, Whole Foods 470 lo- margins, according to in Mar- cates in stores is distracting to of the companies Allergan was
cations will no longer allow ket location data. employees and inefficient. built from. Mr. Bisaro took the
brand representatives to pro- The changes are among Whole Foods has had them helm of Impax this year, re-
mote their products or check to those expected to be discussed there for years, but sales de- suming a long career running
make sure they are stocked and next week by top executives clines in recent years have generic- and specialty-drug
displayed correctly. and managers at the chains brought scrutiny to the grocers companies.
Whole Foods also is central- quarterly meeting in Seattle, a long-held practices. Formed in 1999 when a
izing much of its decision-mak- regional hub for Whole Foods The new system, the Whole closely held predecessor
ing regarding the assortment of and Amazons home base. Foods spokeswoman said, is in- merged with publicly traded
products across the chain. In- Whole Foods representatives tended to save money and pro- Global Pharmaceutical Corp.,
stead of allowing brands to fre- informed suppliers and third- vide more consistent service Impax has about 1,400 em-
CARLO ALLEGRI/REUTERS

quently pitch their products to party brand representatives and a national approach to its ployees and had revenue last
individual stores or regions, about the plans during a series locations. She declined to detail year of $824 million, accord-
Whole Foods executives in its of closed-door meetings at an what Whole Foods will do to ing to its website. The com-
Austin, Texas, headquarters industry conference last week. make up for the work these pany sells several branded
will choose a higher percentage Whole Foods is unique third-party brand-support com- drugs for conditions such as
of the inventory. among large retailers in the ex- panies have provided in stores. Parkinsons disease and mi-
The move was slowly getting tent to which it has let repre- The Amazon-owned chain plans to centralize product selection We are still working on graines but generics make up
under way before Amazon.com sentatives of lesser-known and limit brand representatives access to its stores. that plan. But independent the bulk of sales.
Inc.s deal for the chain in Au- products into the stores to pro- [providers] are being elimi- During last months earn-
gust, and its acquisition has mote their offerings. president of Retail Insights, a ically dont have time to learn nated, she said. ings call with analysts and in-
added incentive for Whole Some suppliers and natural- Vermont-based natural-prod- about updated products, an is- One company that promotes vestors, Mr. Bisaro bemoaned
Foods to shift from its decen- food consultants say sales of ucts industry consultancy that sue particularly when health brands in Whole Foods stores how consolidation among buy-
tralized model and become specialty products could suffer works with independent retail- goods are involved, the person said it is laying off half of its ers of generic drugs has
more efficient. because items such as chia- ers. The product mix at Whole said. employees in response to the squeezed manufacturers and
This is another step in the soaked seeds and charcoal body Foods will shrink. The niche Id expect the education grocers decision. said he was looking to do
conventionalizing of Whole butter require some explana- lines will trickle out to other and hence knowledge, of in- Whole Foods recently came deals.
Foods as we know it, said Jim tion and more marketing. Some grocers. store associates will diminish out with a noncompete agree- Amneal, which is based in
Cusson, of Theory House, a consultants also say they ex- Brand representatives in over time, Mr. Cusson said. ment for its employees, barring Bridgewater, was founded in
brand consultancy based in pect local brands to take their health and beauty currently ed- Other suppliers said they them from selling into Whole 2002 and is led by brothers
Charlotte, N.C. products elsewhere, rather than ucate employees about how welcome the change. They said Foods if they go to work at one Chintu and Chirag Patel. It has
Amazon is hoping to boost having to make a pitch to their products can help treat a they expect Whole Foods to be- of the brands it carries. The more than 5,000 employees
sales at the struggling grocer, Whole Foods headquarters. customers allergies or other gin offering brand advocacy Whole Foods spokeswoman said around the world, and Ever-
in part, by standardizing opera- This is a major inflection health conditions, one broker- themselves for a fee that is the policy is common to big re- core ISI has estimated yearly
tions and prices. Market re- point, said Jay Jacobowitz, age owner said. Employees typ- similar to what they pay the tailers and it lasts only a year. sales of roughly $1 billion.
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
B4 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

TECHNOLOGY WSJ.com/Tech

CHINA CIRCUIT | By Li Yuan

Innovators Now Viewed as Public Nuisance

As in Sili- Meituan says it handles
con Valley, Hungry Online more than 13 million orders
Chinese tech Meal-delivery apps have grown a day. Ele.me says that it had
companies sharply in China. served 260 million custom-
like to think ers by June 2017 since its
of themselves 300 million users founding in 2008. Many of
as agents of positive change. those customers come from
And just as in the U.S., the a growing middle class that
public doesnt always see 200 is anxious about dirty air,
them that way. water and food.
Chinas three main online Monica Shen, an executive
meal-delivery services are in at Shenzhen-based technol-
the crosshairs of public opin- 100 ogy startup Seeed Studio,
ion over perceptions they says she avoids ordering meal
arent socially responsible. A deliveries because of environ-
nonprofit group is suing the mental concerns. She says she
companiesEle.me, Baidu 0 is willing to pay for more en-
Waimai and Meituan Dian- 2H 2015 1H 16 2H 1H 17 vironmentally friendly pack-
pingfor generating huge aging if there is an option.

ANDY WONG/ASSOCIATED PRESS

Source: China Internet Network
amounts of waste that it al- Information Center Catering to these consum-
leges constitute environmen- THE WALL STREET JOURNAL. ers will test the business
tal harm. A Beijing court model favored by the meal-
agreed early this month to Meituan Dianping are among delivery services and many
hear the case. the most popular services of other mobile-internet start-
Public disapproval started the mobile internet. Some ups: spend to build scale and
to build after an article trash- 295 million Chinese, nearly capture market share; worry
ing the apps went viral on so- 40% of the countrys internet about profits later.
cial media last month. The ar- users, turned to one of their Workers for the Meituan food-delivery app in Beijing last year. Some tech firms have sparked criticism. Ele.me, backed by Alibaba,
ticle, headlined Meal apps in the first half of 2017, is valued at $6 billion and
Delivery Is Destroying Our up from 21% a year ago, ac- very quickly from innovators type of biodegradable plastic Public lashings of internet has raised $2.3 billion since
Next Generation, accused cording to government data. to nuisance, says Yin Juelin, bag in April. Meituan said it companies over social ac- 2008. Meituan Dianping,
them of pursuing growth to The services have received a management professor at appointed a chief environ- countability recur frequently which has funding from Ten-
the detriment of the coun- funding from the biggest Xian Jiaotong-Liverpool Uni- ment officer in early 2017. so they ought to be better cent, raised $3.3 billion in
trys already degraded envi- tech forces in Chinae-com- versity. They impact so Zhang Shouchun, the at- prepared. Tencent landed in January 2016 at a valuation
ronment. Big state media fol- merce giant Alibaba Group many peoples lives. Its nat- torney representing environ- hot water this summer when of $18 billion and is cur-
lowed up, and in weeks a tide Holding Ltd., game and so- ural that the public wants to mental group Green Volun- state media and the public rently raising a further $2
of news articles and social- cial-media titan Tencent hold them accountable. teer League of Chongqing, criticized its top mobile billion, according to a person
media commentary swelled. Holdings Ltd. and Baidu Inc., Meituan and Ele.me which brought the lawsuit, game, Honor of Kings, for familiar with the matter.
Say no to meal deliv- the dominant search engine. which recently acquired said his client previously con- being so addictive that it None of them, however, is
ery! became a popular cry These internet companies Baidu Waimai though they tacted the companies about was harming Chinas youth. profitable, according to ana-
on Weibo, Chinas Twitter- touch more aspects of peo- operate separatelydeclined adding a no-chopsticks op- Tencent now limits daily lysts and investors.
like service. ples lives than any other to comment on the lawsuit. tion but never got anywhere. play time for users under 18. These companies need to
Cant agree more, com- sector in the worlds second- They said in statements that The suit demands that the Baidus share price got tweak their business models
mented Mao Daqing, founder biggest economy. But theyre theyre committed to pro- companies apologize for the hammered last year after a to shoulder additional costs,
of space-sharing startup Ur- ill-prepared for the expecta- tecting the environment, and environmental damage and public outcry over the death says Ms. Yin, the management
Work (Beijing) Venture In- tions of social responsibility each noted various green ini- set up funds to clean it up. of a college student suffering professor: They have to re-
vestment Co., on his WeChat that come with their influ- tiatives under way. The internet companies from a rare cancer; he died spond to the demand of the
account. Many people ence and power, say industry Meituan and Ele.me have are making significant con- following treatment found growing middle class. This is-
around me, including my experts and social activists. added the option of no- tributions to Chinas eco- via the search engine. sue isnt going to go away.
child, are eating garbage ev- Some internet companies chopstick packages in recent nomic growth, but theyre Meal-delivery apps are so
ery day and producing gar- grew to be very big very weeks. Baidu Waimai will also causing huge problems, pervasive and cheap that Follow Li Yuan on Twitter
bage at the same time. quickly, but the public per- make the change next month. said Mr. Zhang. They need many Chinese scarcely leave @LiYuan6 or write to
Ele.me, Baidu Waimai and ception of them also changed Ele.me started using a new to be more responsible. their office or home to eat. [email protected].

Truck Makers, Users Strive for Fuel Economy EU Preps

BY ERICA E. PHILLIPS 14% by 2021, 20% by 2024 and
25% by 2027, from 2010 levels.
pay for itself. Long-haul trucks
typically drive about 110,000
New Taxes
The average big rig can
travel fewer than 7 miles on a
gallon of diesel fuel, making it
The Trump administration
seeks to roll back some aspects
of the rules. Still, many truck
miles a year. So with diesel fuel
at $2.50 a gallon, a 0.5 mile a
gallon improvement in fuel effi-
On Tech
one of the least-efficient vehi-
cles on the road. Truck manu-
facturers want to change that.
and engine makers say they
plan to press ahead with their
new designs, citing fleet own-
ciency could save some $3,100
per truck each year.
Even with todays technol-
Firms
Spurred by new pollution ers demands for fuel savings. ogy, fleet operators are finding BY SAM SCHECHNER AND
regulations and sluggish de- Truck manufacturers have ways to save on fuel. Several NATALIA DROZDIAK
mand, truck makers including seen that regulations that re- leading fleets are already aver-
Navistar International Corp., sult in better fuel economy can aging over 7 mpg. Many have The European Unions exec-
Daimler AG, Paccar Inc. and aid their sales, even at higher added devices that improve utive arm said Thursday that
Volvo AB, along with engine prices. When truck and engine aerodynamics, such as skirts it is ready to propose new
manufacturer Cummins Inc., makers included a new exhaust- around the base of the tractor taxes on digital companies like
are rethinking everything from treatment system to comply and trailer, and winglike tails Facebook Inc. and Alphabet
engine design to the shape of with a tougher federal pollution on the trailer back. Some have Inc.s Google by next spring if
the trailer in order to bump up standard in 2010, the side bene- opted for smaller engines, auto- there isnt adequate global
fuel efficiency. fit of improved mileage pro- matic transmissions or technol- progress toward a rewrite of
DAIMLER AG

Even small gains can have a pelled years of elevated de- ogies that switch to electric corporate tax rules at an inter-
big environmental impact. Each mand. Truckers accelerated power for the lights, climate national level.
year in the U.S., roughly 1.7 mil- trade-ins of their older tractors system and other functions The blocs executive arm,
lion tractor-trailer trucks con- Fuel-efficient technologies can add significantly to a long-haul to gain better fuel economy. when the engine is idling. the European Commission,
sume about 26 billion gallons of rigs price, but they can also pay for themselves over time. Such fuel-efficient technolo- Trucking company U.S. floated several options that it
diesel. Getting an extra mile a gies can add thousands of dol- Xpress Enterprises Inc. orders said could be rolled out in the
gallon equals removing more be years before they hit the The average heavy-duty lars to a rigs price, which can about 1,500 tractors a year, and short term to raise tax reve-
than 200,000 trucks from the road in big numbers. Mean- truck, including short-haul and run $120,000 to $150,000 for requests aerodynamic design nue on digital companies,
road. It also could save trucking while, the industry is betting on work vehicles like dump trucks, the truck itself, or tractor, elements like tails and skirts as which it contends declare too
companies billions of dollars. squeezing fuel savings from gets only about 5.9 miles a gal- and $25,000 to $30,000 more well as automatic transmissions little profit in the region.
Some truck makers want to diesel trucks. lon, a figure that has barely for the trailer. on its trucks. While the commission said a
ditch the combustion engine The race is on, said Steve budged in 10 years, according The new targets represent a Fuel is such a large cost for global solution would be pref-
entirely. Cummins introduced Gilligan, vice president of mar- to the North American Council real challenge for our industry, us that we have every incentive erable, it added that it stands
the industrys first fully electric keting for Navistars North for Freight Efficiency, an indus- said John Mies, a Volvo spokes- to try to get to the best miles ready to propose legislation
heavy-duty demonstration America business. Every truck try group. Federal regulators man. Maximizing fuel econ- per gallon we possibly can, if major countries, including
truck in August, and Tesla Inc. manufacturer is looking for a last October finalized rules re- omy has to be balanced with said Chief Executive Eric Fuller. the U.S., cant make headway
plans to announce its own pro- technology advantage versus quiring makers of heavy-duty other factors. Bob Tita on new rules.
totype next month. But it may their competition. trucks to boost fuel efficiency Still, fuel efficiency could contributed to this article. The threat of new tax legis-
lation comes amid pressure
from big EU countries includ-

Facebook Cedes on Russian-Backed Ads

ing France and Germany,
which have recently increased
their push to change corporate
tax rules at any level to cap-
Facebook Inc. said Thursday sessment of what happened in tisement. ture what they say are billions
it has struck a deal to share the 2016 election. Company to Keep was tiny, and it isnt clear if any Were open to reviewing of euros in lost revenue. Fi-
with congressional investiga- The House and Senate Intel- advertiser actually used the any specific congressional pro- nance ministers for EU coun-
tors the Russian-backed ads ligence Committees are con- Eye on Ad Targeting hateful terms. Still, the episode posals, a Facebook spokesman tries expressed support over
purchased during the U.S. pres- ducting separate probes of has again spotlighted Facebooks said prior to the companys an- the weekend for renewing ef-
Russian activity during the failure to anticipate how its nouncement on Thursday. We forts to change international
By Deepa 2016 election with the aim of Facebook Inc. is adding more platform can be manipulated. are looking into more ways to rules to better reflect digital
Seetharaman, publicly documenting what human reviewers to oversee its We never intended or antic- address ad transparency on our profits rules via the Organiza-
Byron Tau happened during last years di- advertising system after a re- ipated this functionality being platform. tion for Economic Cooperation
and Robert McMillan visive campaign. Facebook had port showed people could target used this wayand that is on A Twitter Inc. spokes- and Development, a forum of
shared limited information ads at users interested in anti- us, Chief Operating Officer woman said company officials wealthy countries that in-
idential campaign, capitulating with the committees in recent Semitic and other hateful topics. Sheryl Sandberg said in a post would meet Senate staffers cludes the EU, U.S. and Japan.
to political pressure to be more weeks, and made more com- The problem stems from Wednesday. And we did not next week to discuss the 2016 European officials argue
forthcoming with information. plete disclosures to Special how Facebooks ad system au- find it ourselvesand that is election. Twitter engages with that companies are taking ad-
In recent weeks, investiga- Counsel Robert Mueller, who is tomatically mines information also on us. governments around the world vantage of outdated tax rules
tors have begun scrutinizing leading a separate criminal and from user profiles to create spe- Ms. Sandberg said Facebook on public policy issues of im- that were designed on the ba-
what role Russian activity on counterintelligence investiga- cific topics that advertisers can would conduct more manual re- portance and of interest to pol- sis of physical assets and
social media might have played tion into the same topic. pay to target. views of new ad-targeting op- icy makers, she said. where the companies operate,
in the electionespecially after Facebooks decision came as In a report last week, news tions that automatically appear Tech firms such as Facebook rather than virtual businesses
Facebook disclosed that it lawmakers have begun a push outlet ProPublica showed that in its system. It restored about and Twitter are subject to like online advertising and
found more than $150,000 in to crack down on exemptions the system could enable some- 5,000 of the most common tar- looser disclosure requirements data mining.
Russian-linked ad spending on that allow social-media compa- one to show ads to Facebook geting terms used by advertis- than traditional media, such as Its a question of fairness:
more than 5,200 ads on its nies to operate beyond the users whose profiles included ers, such as nurse, teacher or television and radio stations, Digital companies use Euro-
platform. norms of political campaigns. terms like Jew hater or How dentistry, after conducting a which must publicly disclose pean networks and infrastruc-
After an extensive legal and Congressional leaders and to burn jews. The number of manual review of those topics. campaign ads they broadcast. ture, and often their content
policy review, today we are an- other groups are starting to users for each anti-Semitic term Deepa Seetharaman Video advertisements that and data are created by Euro-
nouncing that we will also discuss legislation that would appear on social media also peans. Like all taxpayers, they
share these ads with congres- require social-media companies arent bound by the Stand By must pay their fair share of
sional investigators, the com- to create a public-disclosure pushing the Federal Election sional Democrats encouraged Your Ad provision requiring tax, said EU finance chief
pany said. We believe it is vi- portal of political ads shown on Commission to create rules the FEC to take immediate candidates in their own voice Pierre Moscovici, adding that
tally important that their platforms, similar to the that would curb the ability of steps to understand the threats to take responsibility for the the current system allows for
government authorities have requirements of television and foreigners to spend money on posed to our democratic pro- ads their campaigns runusu- a big loss in tax revenues for
the information they need to radio stations. political advertising. cess by foreign influenced in- ally in the form of a candidate the budgets of EU member
deliver to the public a full as- Separately, Democrats are On Wednesday, 20 congres- ternet and social media adver- approving this message. states.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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THE WALL STREET JOURNAL. Friday - Sunday, September 22 - 24, 2017 | B5

FINANCE & MARKETS

AIA Buys Banks Life-Policy Unit ECB Set

To Create
Commonwealth Bank tal ratio by 0.7 percentage ment.
of Australia sheds life-
insurance businesses
point to take it slightly above
the 10.5% minimum threshold
that Australias banking regu-
Commonwealth Bank is un-
der intense scrutiny after the
Australian governments finan-
Alternative
for $3.05 billion
lator this year ordered the
countrys major banks to reach
by 2020.
cial-intelligence agency
launched a civil suit, alleging
more than 53,700 breaches of
To Rate
BY ROBB M. STEWART

MELBOURNE, Australia
However, the sale will di-
lute Commonwealth Banks
earnings modestly and it said
the anti-money-laundering and
counterterrorism funding laws.
The accusations largely in-
Yardsticks
Commonwealth Bank of Aus- it expected about a A$300 mil- volve failing to provide trans- BY TODD BUELL
tralia is considering spinning lion loss on the deal, largely action reports on deposits

BRENDON THORNE/BLOOMBERG NEWS

off its global asset-manage- due to the carrying value of through its automated ma- The European Central Bank
ment unit after announcing a goodwill. The businesses being chines, which the bank has said it would introduce a new
US$3.05 billion sale of its life- picked up by AIA had earnings blamed on a coding error in a unsecured overnight interest
insurance businesses to AIA of about A$224 million in the software upgrade. The agency rate, the latest step by a cen-
Group Ltd. latest fiscal year, a fraction of alleged it allowed millions of tral bank to develop an alter-
A sale of Colonial First the A$9.7 billion before items dollars to be laundered by native to scandal-plagued
State Global Asset Manage- reported by Commonwealth drug dealers and other crimi- benchmarks that are key to
ment would further bolster Bank. nals. The case has triggered the financial system.
the capital position of Austra- The price the bank will independent reviews by the The new rate, set to be pub-
lias largest bank at a time fetch for the businesses was securities and prudential regu- lished daily by 2020, will be
when regulators are pushing The lenders asset-management operations also are under review. slightly below expectations lators into culture, pay and based on data available to the
lenders to increase buffers but it is outweighed by the governance at the bank. ECB and other central banks
against risk, and tightens the to dedicated insurers better the largest life-protection longer-term benefits, particu- Under the partnership with that use the euro.
banks focus as it defends it- able to compete in a sector market in Asia outside Japan, larly the increase in capital, AIA, Commonwealth Bank said Central banks and other of-
self against accusations its that has struggled in recent and that data suggested there said David Ellis, an analyst at it would continue to earn in- ficial bodies are taking control
compliance failings allowed its years with rising claims and was an estimated US$1.1 tril- investment-research firm come on the distribution of of overnight interest rates fol-
accounts to be used for money policy terminations. Earlier lion gap in the provision of life Morningstar. life- and health-insurance lowing scandals in the private
laundering. this week, Australia & New insurance and mortality pro- Its a good outcome, Mr. products. It also will retain its sector, most notably with the
In a statement Thursday, Zealand Banking Ltd. said it tection cover. The Hong Kong- Ellis said, adding it allowed general insurance business London interbank offered rate,
Commonwealth Bank said it was in talks with a number of listed insurer said Common- Commonwealth Bank to clean and CommInsure brand. or Libor.
was selling all of its life-insur- potential suitors for its Aus- wealth Banks businesses offer up its businesses after a string With the sale, which the
ance businesses in Australia tralian wealth operations, access to 13 million bank cus- of scandals. companies expect to wrap up
and New Zealand to AIA for which includes its local insur- tomers across Australia and In addition to the AIA sale in 2018, Commonwealth Banks
3.8 billion Australian dollars ance, pension, investments New Zealand, and should offer deal, which remains subject to executive for wealth manage-
The rate will be based
(US$3.05 billion). The sale and advice businesses. a lift in AIAs earnings and fu- regulatory approval, Common- ment, Annabel Spring, will on data available
agreement also includes hav- AIA, one of the worlds ture cost savings of at least wealth Bank said it was re- leave the bank in December.
ing the pan-Asian insurer pro- largest life insurers, said it US$60 million a year. viewing its Colonial First State Ms. Spring, who joined Com-
to central banks
vide life-insurance products to would become the market For Commonwealth Bank, business and would consider a monwealth Bank in 2009 as that use the euro.
the banks customers for 20 leader in both Australia and Australias biggest bank by number of options, including head of strategy, will continue
years. New Zealand after combining market capitalization and larg- an initial public offering. to lead the wealth-manage-
It adds to a number of re- Commonwealth Banks busi- est mortgage lender, the sale Known as First State Invest- ment business, the sale pro-
cent moves by Australian nesses with its own opera- is expected to release about ments outside Australia, the cess and strategic review until In July, a top U.K. regulator
banks to unload capital-inten- tions. A$3 billion in capital and lift unit has more than A$219 bil- the end of the year, the bank said it would phase out Libor,
sive life-insurance operations AIA said Australia offers its common equity Tier 1 capi- lion in assets under manage- said. a benchmark used to set the
price of trillions of dollars in
loans and derivatives world-

Bitcoin Chinese Lender Seeks Cash Abroad

wide.
The integrity of the bench-
mark was called into question

Executives BY MANJU DALAL of shares in a Hong Kong ini-

tial public offering. That deal
following a rate-rigging scan-
dal in which traders at numer-
ous banks manipulated data

Face China State-owned Postal Savings

Bank of China Co. is raising
up to $7.6 billion in one of the
was one of the biggest stock
sales by a Chinese company
following the 2014 IPO of Ali-
used to set the rate. Libor is
calculated by asking banks
how much it theoretically

Travel Ban largest-ever sales of offshore

securities by a Chinese lender.
The bank, Chinas sixth
baba Group Holding Ltd. The
Beijing-based banks shares
are trading slightly below
would cost them to borrow
money from other banks.
More than a dozen banks
Chinas widening crackdown largest by assets, on Thursday their listing price. paid roughly $10 billion in
on bitcoin trading resulted in launched a sale of U.S. dollar- Postal Savings Bank gets its penalties related to their
QILAI SHEN/BLOOMBERG NEWS

a travel ban of sorts for two denominated securities that name from Chinas post office, fraudulent Libor activities.
executives from the countrys are known as contingent con- which it was once part of. It Last month, the Federal Re-
largest commercial bitcoin ex- vertibles, or cocos. Invest- has close to 40,000 branches serve opened for public com-
changes, which regulators are ment bankers in recent days across the country and serves ment three proposed reference
closing down. have been marketing the offer- more than one-third of Chinas rates for firms using Trea-
ing to investors in Hong Kong, population, according to an in- surys as collateral for short-
By Gregor Stuart Singapore, Paris and London. vestor presentation. Its assets term loans.
Hunter in Hong Kong The deal will be a test of totaled $1.26 trillion at the The ECB said Thursday that
and Chao Deng global investors appetite for Postal Savings Bank of China aims to raise up to $7.6 billion. end of June. the new rate would serve in
in Beijing risk in Chinas financial sec- Analysts said potential buy- addition to benchmarks pro-
tor. The securities were ini- stricter capital rules on banks. Hong Kong-listed common ers of Postal Savings Banks duced by the private sector.
On Thursday, top executives tially being offered with a The new Postal Savings shares upon a trigger event. new securities may draw com- Interest-rate benchmarks
of two Chinese digital cur- yield of about 4.85%, accord- Bank securities are classified That could happen if the fort from the lenders majority are currently undergoing in-
rency exchanges who were ing to a person familiar with as additional Tier 1 securi- banks core Tier 1 capital ade- state ownership, which implies depth reforms. The ECB de-
scheduled to speak at an in- the matter, but strong investor ties and will help the bank quacy ratio falls to or below the Chinese government would cided to take action as bench-
dustry conference in Hong demand led bankers later to meet core capital require- 5.125%, or if Chinese regula- step in to bail out the bank if mark rates have an important
Kong didnt show up and their lower guidance for the yield to ments under Basel III rules. tors require the bank to boost it ever runs into trouble. anchoring role for contracts in
sessions were canceled. The 4.55%. Officially called offshore its capital levels, according to Aside from foreign inves- financial markets, the ECB
events organizer, a bitcoin- Chinese banks are looking preference shares, the securi- Moodys Investors Service, tors, Chinese investorsin- said. The ECB said high-level
trading firm called Bitkan, offshore for their fundraising ties pay annual dividends and which has a speculative-grade, cluding life insurers, corpora- features of the new rate
didnt provide a reason. The needs as borrowing costs on are designed to absorb losses or junk, rating on the securi- tions and other asset would be communicated to
two executives were Lin Li, the mainland have risen over if the bank runs into trouble. ties. managersare likely to be market participants over the
chief executive of Huobi, and the past year. Regulators also The securities can be called af- The banks latest securities large buyers of the offshore course of next year, with mar-
Justin Pan, who the event or- have been trying to rein in ter five years but would be sale comes roughly a year af- deal and that may tighten the ket participants then able to
ganizer listed as being the loose lending and imposed converted into the banks ter the lender sold $7.4 billion pricing on the securities. provide feedback.
chief operating officer of OK-
Coin.
The two-day conference
was originally supposed to be
held in Beijing but its organiz-
ers last week decided to shift
Intruders Prowled for Months in Equifax Hack
the venue to Hong Kong after BY ANNAMARIA ANDRIOTIS been asking how the attack oc- Richard Smith will testify in reconnaissance mission, accord- cessed files that contained
Chinese regulators earlier this AND ROBERT MCMILLAN curred and whether Equifax front of U.S. senators next ing to a person familiar with Equifax credentials, such as
month ordered digital-cur- took sufficient measures to month about the companys the investigation. It is common username and password, and
rency exchanges to wind down Hackers roamed undetected protect such information. handling of the breach. for attackers to lurk for months performed database queries
their operations. in Equifax Inc.s computer net- Equifax sent the Mandiant After interacting with Equi- after their initial break-in as that provided access to docu-
Software pioneer and for- work for more than four report to some customers, faxs server in early March, the they probe corporate systems ments and sensitive informa-
mer fugitive John McAfeea months before its security many of which are financial hackers then entered the com- the digital equivalent of trying tion stored in databases in an
high-profile but controversial team uncovered the huge data firms, with a cover letter puter command Whoami, as many doorknobs as possible Equifax legacy environment,
character in the bitcoin indus- breach, the security firm Fire- dated Tuesday, Sept. 19, that to see which doors open. the Mandiant report said.
trytold conference attendees Eye Inc. said this week in a was signed by the companys The March activity was likely Overall, the attackers ac-

143
on Wednesday that top execu- confidential note Equifax sent new chief information officer, a result of the hackers spam- cessed numerous database ta-
tives from the major bitcoin to some of its customers. Mark Rohrwasser, and new ming the internet for vulnerable bles in several databases, the
exchanges are currently not FireEyes Mandiant group, chief security officer, Russ Ay- systems, said Johannes Ullrich, Mandiant report said.
allowed to leave China. which has been hired by Equi- res. Equifax on Sept. 15 an- dean of research with the SANS The report added that the at-
At a meeting last week in fax to investigate the breach, nounced the departure of the Millions of Americans whose Technology Insitute, a cyberse- tackers compromised two sys-
Beijing, regulators provided bit- said the first evidence of hack- two executives who previously data may have been accessed curity training school. tems that support Equifaxs
coin executives with a docu- ers interaction with the held those positions. It isnt surprising that the online dispute web application.
ment saying that the exchanges company occurred on March In a progress report that hackers took weeks before ac- This is the place where consum-
major shareholders, senior 10, according to the Mandiant accompanied that announce- cessing the sensitive data, Mr. ers go to dispute information
managers and key finance and report, which was reviewed by ment, Equifax said hackers ac- Mandiant wrote. This command Ullrich said. Typically, you first on their credit reports.
technical personnel should re- The Wall Street Journal. cessed consumers data from would have given the attackers build out a beachhead so that The identity of the hackers is
main in Beijing to work with Equifax had previously dis- May 13 through July 30. It the username of the computer its difficult to get kicked out, still unknown. Mandiant said in
regulators while unwinding closed that data belonging to didnt mention in that report account to which they had just he added. its letter that it hadnt been
their trading businesses. approximately 143 million that the attack had begun at gained access, an early step in a On average, it takes compa- able to attribute the breach to
Huobi and OKCoin spokes- Americans was potentially ac- an earlier date. hacking attempt. nies close to 100 days to dis- any threat group actor it cur-
women didnt respond to re- cessed in May. It isnt known Mandiants report this week Investigators havent deter- cover that they have been rently tracks. Nor did the tools,
quests for comment. when Equifax learned from noted the hackers accessed mined for certain whether the hacked, FireEye said in a report tactics and procedures used
Curbs on travel are a con- Mandiant that the hacking ac- one of Equifaxs servers by March incident was issued by released this year. In Equifaxs overlap with those seen in pre-
ventional tool used by Chinese tivity began in March, not taking advantage of a flaw in the data thieves or a different case, it took 141 days. vious investigations by the firm.
authorities during investiga- May. Equifax wasnt available software called Apache Struts, set of hackers, but it was likely Eventually, between May 13 Imani Moise contributed to
tions. to comment. used by many companies to the beginning of a monthslong and late July, the attackers ac- this article.
Financial regulators have Equifax has said it didnt build interactive websites.
applied them in the past, in- discover the breach until July Two days before the access
cluding in the aftermath of
Chinas stock-market melt-
29. Days later it called in Man-
diant. Equifax didnt disclose
occurred, on March 8, security
researchers at Cisco Systems
Advertisement INTERNATIONAL INVESTMENT FUNDS
down in mid-2015. In this in- the breach until Sept. 7. Inc. warned of the flaw in
stance, the bitcoin industry The attack, which is being Struts and a patch was issued [ Search by company, category or country at europe.WSJ.com/funds ]
players haven't been accused probed by the Federal Bureau by the Apache Software Foun-
of wrongdoing. of Investigation, is one of the dation. Equifax in its report last NAV %RETURN
FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR
Regulators recently decided most significant data breaches week said its security staff
n Chartered Asset Management Pte Ltd - Tel No: 65-6835-8866
upon a comprehensive ban on given the scope of the informa- took efforts to fix the system, Fax No: 65-6835 8865, Website: www.cam.com.sg, Email: [email protected]
channels for the buying and tion disclosed: peoples names, saying it understood the intense CAM-GTF Limited OT OT MUS 09/15 USD 306780.09 1.6 -1.6 7.1
selling of the virtual currency addresses, dates of birth and focus outside the company on
in China. Social Security numbers. In its patching efforts and that its re- Data as shown is for information purposes only. No offer is being made by
Morningstar, Ltd. or this publication. Funds shown arent registered with the
For information about listing your funds,
Steven Russolillo wake, consumers, customers, view was ongoing. U.S. Securities and Exchange Commission and arent available for sale to United
States citizens and/or residents except as noted. Prices are in local currencies.
please contact: Freda Fung tel: +852 2831
contributed to this article. regulators and legislators have Equifax Inc. Chief Executive All performance figures are calculated using the most recent prices available. 2504; email: [email protected]
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 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

MARKETS DIGEST
Nikkei 225 Index STOXX 600 Index S&P 500 Index Data as of 4 p.m. New York time
Last Year ago
20347.48 s 37.02, or 0.18% Year-to-date s 6.45% 382.88 s 0.90, or 0.24% Year-to-date s 5.94% 2500.60 t 7.64, or 0.30% Trailing P/E ratio 24.11 24.47
High, low, open and close for each 52-wk high/low 20347.48 16251.54 High, low, open and close for each 52-wk high/low 396.45 328.80 High, low, open and close for each P/E estimate * 19.10 18.25
trading day of the past three months. All-time high 38915.87 12/29/89 trading day of the past three months. All-time high 414.06 4/15/15 trading day of the past three months. Dividend yield 1.99 2.14
All-time high: 2508.24, 09/20/17

Weekly P/E data based on as-reported earnings from Birinyi Associates Inc.
Session high 20500 390 2525
DOWN UP
t

Session open Close 65-day moving average

20250 385 2500
Close Open
t

Session low 20000 380 2475

19750 375 2450

19500 370 2425

65-day moving average

19250 365 2400

65-day moving average
Bars measure the point change from session's open
19000 360 2375
June July Aug. Sept. June July Aug. Sept. June July Aug. Sept.

International Stock Indexes Data as of 4 p.m. New York time Global government bonds
Latest 52-Week Range YTD Latest, month-ago and year-ago yields and spreads over or under U.S. Treasurys on benchmark two-year
Region/Country Index Close NetChg % chg Low Close High % chg and 10-year government bonds around the world. Data as of 3 p.m. ET
World The Global Dow 2905.65 8.69 0.30 2386.93 2909.28 14.9 Country/ Spread Over Treasurys, in basis points Yield
MSCI EAFE 1970.72 10.77 0.54 1471.88 1973.76 14.8 Coupon Maturity, in years Yield Latest Previous Month Ago Year ago Previous Month ago Year ago
MSCI EM USD 1107.93 4.14 0.37 691.21 1111.59 39.5 2.750 Australia 2 1.991 54.4 56.9 51.7 85.3 2.012 1.826 1.627
2.750 10 2.835 55.8 56.5 46.3 48.2 2.837 2.648 2.135
Americas DJ Americas 604.09 1.86 0.31 503.44 606.05 11.8
3.000 Belgium 2 -196.9 -197.0 -186.6 -137.2 -0.527 -0.556 -0.597
-0.522
Brazil Sao Paulo Bovespa 75503.63 500.52 0.66 56828.56 76419.58 25.4
0.800 10 0.735 -154.3 -155.1 -147.0 -142.3 0.721 0.714 0.230
Canada S&P/TSX Comp 15458.69 69.09 0.45 14468.03 15943.09 1.1
0.000 France 2 -0.476 -192.3 -191.3 -178.9 -136.5 -0.471 -0.480 -0.590
Mexico IPC All-Share 50563.36 199.41 0.40 43998.98 51772.37 10.8
1.000 10 0.735 -154.3 -154.5 -148.3 -134.7 0.727 0.702 0.306
Chile Santiago IPSA 4015.31 35.32 0.89 3120.87 4020.83 24.6
0.000 Germany 2 -0.677 -212.3 -212.2 -202.0 -142.4 -0.679 -0.710 -0.650
U.S. DJIA 22359.23 53.36 0.24 17883.56 22419.51 13.1
0.500 10 0.456 -182.1 -182.8 -178.2 -164.8 0.444 0.402 0.005
Nasdaq Composite 6422.69 33.35 0.52 5034.41 6477.77 19.3
0.050 Italy 2 -0.110 -155.7 -155.5 -136.9 -87.1 -0.113 -0.060 -0.096
S&P 500 2500.60 7.64 0.30 2083.79 2508.85 11.7
2.200 10 2.098 -18.0 -20.2 -15.3 -36.3 2.071 2.032 1.290
CBOE Volatility 9.80 0.02 0.20 8.84 23.01 30.2
0.100 Japan 2 -0.125 -157.2 -157.3 -143.9 -99.5 -0.131 -0.130 -0.221
EMEA Stoxx Europe 600 382.88 0.90 0.24 328.80 396.45 5.9 0.100 10 0.030 -224.7 -224.2 -214.9 -167.6 0.030 0.036 -0.023
Stoxx Europe 50 3122.55 11.14 0.36 2720.66 3279.71 3.7 4.000 Netherlands 2 -0.684 -213.1 -211.9 -196.4 -138.5 -0.677 -0.654 -0.610
Austria ATX 3296.86 7.72 0.23 2357.57 3304.29 25.9 0.750 10 0.575 -170.3 -170.9 -165.2 -153.9 0.563 0.532 0.114
Belgium Bel-20 3968.67 3.18 0.08 3384.68 4055.96 10.0 4.750 Portugal 2 -0.056 -150.3 -151.4 -133.0 -29.5 -0.072 -0.021 0.479
France CAC 40 5267.29 25.63 0.49 4342.64 5442.10 8.3 4.125 10 2.404 12.7 9.7 53.3 174.7 2.370 2.717 3.400
Germany DAX 12600.03 30.86 0.25 10174.92 12951.54 9.7 2.750 Spain 2 -0.315 -176.1 -177.0 -168.7 -96.3 -0.327 -0.377 -0.189
Greece ATG 765.99 8.01 1.06 559.92 859.78 19.0 1.450 10 1.613 -66.4 -70.8 -75.8 -64.8 1.564 1.427 1.005
Hungary BUX 38109.21 1.17 0.003 27466.59 38554.44 19.1 4.250 Sweden 2 -0.700 -214.7 -214.4 -198.5 -142.1 -0.702 -0.675 -0.647
Israel Tel Aviv 1419.90 Closed 1346.71 1490.23 3.5 1.000 10 0.651 -162.7 -164.7 -158.8 -136.3 0.626 0.596 0.290
Italy FTSE MIB 22491.73 136.15 0.61 15923.11 22529.86 16.9 1.750 U.K. 2 0.455 -99.2 -99.5 -108.0 -66.7 0.448 0.230 0.108
Netherlands AEX 528.47 0.19 0.04 436.28 537.84 9.4 4.250 10 1.368 -90.9 -92.8 -111.0 -95.3 1.344 1.075 0.700
Poland WIG 64209.19 540.31 0.83 46674.28 65611.21 24.1 1.250 U.S. 2 1.447 ... ... ... ... 1.442 1.309 0.774
Russia RTS Index 1120.13 2.30 0.20 956.36 1196.99 2.8 2.250 10 2.278 ... ... ... ... 2.272 2.184 1.653
Spain IBEX 35 10297.00 4.90 0.05 8512.40 11184.40 10.1
Sweden SX All Share 572.20 3.04 0.53 489.12 598.42 7.0 Commodities Prices of futures contracts with the most open interest 3:30 p.m. New York time
Switzerland Swiss Market 9134.13 38.48 0.42 7585.56 9198.45 11.1 EXCHANGE LEGEND: CBOT: Chicago Board of Trade; CME: Chicago Mercantile Exchange; ICE-US: ICE Futures U.S.; MDEX: Bursa Malaysia
South Africa Johannesburg All Share 55867.34 0.12 0.0002 48935.90 56896.89 10.3 Derivatives Berhad; TCE: Tokyo Commodity Exchange; COMEX: Commodity Exchange; LME: London Metal Exchange;
NYMEX: New York Mercantile Exchange; ICE-EU: ICE Futures Europe. *Data as of 9/20/2017
Turkey BIST 100 104001.20 1322.47 1.26 71792.96 110530.75 33.1
One-Day Change Year Year
U.K. FTSE 100 7263.90 8.05 0.11 6676.56 7598.99 1.7 Commodity Exchange Last price Net Percentage high low

Asia-Pacific Corn (cents/bu.) CBOT 350.00 unch. unch. 417.25 344.25

Soybeans (cents/bu.) 970.75 0.75 0.08% 1,047.00 907.00
Australia S&P/ASX 200 5655.40 53.70 0.94 5156.60 5956.50 0.2
Wheat (cents/bu.)
CBOT
CBOT 452.75 3.00 0.67 592.25 422.50
China Shanghai Composite 3357.81 8.18 0.24 2980.43 3385.39 8.2
Live cattle (cents/lb.) CME 116.250 unch. unch. 122.850 99.825
Hong Kong Hang Seng 28110.33 17.47 0.06 21574.76 28159.77 27.8
Cocoa ($/ton) ICE-US 2,024 26 1.30 2,301 1,794
India S&P BSE Sensex 32370.04 30.47 0.09 25765.14 32575.17 21.6
Coffee (cents/lb.) ICE-US 135.40 -1.15 -0.84% 166.75 119.10
Japan Nikkei Stock Avg 20347.48 37.02 0.18 16251.54 20347.48 6.5
Sugar (cents/lb.) ICE-US 14.76 0.06 0.41 20.40 13.50
Singapore Straits Times 3213.82 4.25 0.13 2787.27 3354.71 11.6
Cotton (cents/lb.) ICE-US 68.20 -1.05 -1.52 75.75 66.15
South Korea Kospi 2406.50 5.70 0.24 1958.38 2451.53 18.8 Robusta coffee ($/ton) ICE-EU 2007.00 -28.00 -1.38 2,272.00 1,892.00
Taiwan Weighted 10578.44 59.27 0.56 8931.03 10631.57 14.3
Copper ($/lb.) COMEX 2.9355 -0.0335 -1.13 3.1785 2.5025
Source: SIX Financial Information;WSJ Market Data Group Gold ($/troy oz.) COMEX 1294.80 -21.60 -1.64 1,362.40 1,160.80
Silver ($/troy oz.) COMEX 17.030 -0.304 -1.75 18.875 14.440
Currencies London close on Sept. 21 Aluminum ($/mt)* LME 2,191.00 59.00 2.77 2,191.00 1,688.50
Tin ($/mt)* LME 20,730.00 5.00 0.02 21,225.00 18,760.00
Yen, euro vs. dollar; dollar vs. major U.S. trading partners US$vs,
Thu YTDchg Copper ($/mt)* LME 6,565.00 25.00 0.38 6,937.00 5,491.00
Country/currency in US$ per US$ (%) Lead ($/mt)* LME 2,462.50 52.50 2.18 2,481.00 2,022.00
10% Europe Zinc ($/mt)* LME 3,157.00 60.00 1.94 3,195.00 2,450.50
Bulgaria lev 0.6095 1.6406 11.7 Nickel ($/mt)* LME 11,470.00 450.00 4.08 12,220.00 8,780.00
s WSJ Dollar index Croatia kuna 0.1596 6.266 12.6 Rubber (Y.01/ton) TCE 210.20 -2.00 -0.94 n.a. n.a.
0
Euro zone euro 1.1939 0.8376 11.9
s Euro Czech Rep. koruna-b 0.0458 21.835 15.0 Palm oil (MYR/mt) MDEX 2737.00 -33.00 -1.19 2876.00 2436.00
10 Denmark krone 0.1605 6.2316 11.8 Crude oil ($/bbl.) NYMEX 50.69 unch. unch. 58.37 42.84
Hungary forint 0.003854 259.46 11.8 NY Harbor ULSD ($/gal.) NYMEX 1.8073 0.0082 0.46 1.8206 1.3943
s Yen Iceland krona 0.009304 107.48 4.9
20 RBOB gasoline ($/gal.) NYMEX 1.6060 -0.0098 -0.61 1.6689 1.2736
Norway krone 0.1281 7.8091 9.7
0.2792 3.5811 14.5
Natural gas ($/mmBtu) NYMEX 3.018 -0.131 -4.16 3.5960 2.8860
2016 2017 Poland zloty
Russia ruble-d 0.01728 57.874 5.5 Brent crude ($/bbl.) ICE-EU 56.14 0.21 0.38 60.09 45.51
US$vs, US$vs,
YTDchg YTDchg Sweden krona 0.1254 7.9773 12.4 Gas oil ($/ton) ICE-EU 541.50 4.50 0.84 542.75 408.25
Thu Thu
Country/currency in US$ per US$ (%) Country/currency in US$ per US$ (%) Switzerland franc 1.0311 0.9698 4.8
Turkey lira 0.2852 3.5060 0.5 Sources: SIX Financial Information; WSJ Market Data Group
Americas Hong Kong dollar 0.1281 7.8067 0.7
Ukraine hryvnia 0.0381 26.2350 3.1
Argentina peso-a 0.0579 17.2779 8.9
India rupee
Indonesia rupiah
0.0154
0.0000750
64.9250
13338
4.5
1.4
U.K. pound 1.3564 0.7372 9.0 Cross rates London close on Sep 21
Brazil real 0.3187 3.1373 3.6 Middle East/Africa
Japan yen 0.008901 112.35 4.0
Canada dollar 0.8111 1.2329 8.3 USD GBP CHF JPY HKD EUR CDN AUD
Kazakhstan tenge 0.002937 340.49 2.0 Bahrain dinar 2.6505 0.3773 0.03
Chile peso 0.001602 624.20 6.8 Australia 1.2601 1.7087 1.2989 0.0112 0.1614 1.5041 1.0220 ...
Macau pataca 0.1231 8.1266 2.7 Egypt pound-a 0.0567 17.6380 2.7
Colombia peso 0.0003431 2914.40 2.9 Canada 1.2329 1.6718 1.2710 0.0110 0.1579 1.4717 ... 0.9783
Malaysia ringgit-c 0.2382 4.1980 6.4 Israel shekel 0.2851 3.5077 8.8
Ecuador US dollar-f 1 1 unch
New Zealand dollar 0.7313 1.3674 5.3 Kuwait dinar 3.3135 0.3018 1.3 Euro 0.8376 1.1359 0.8636 0.0075 0.1073 ... 0.6795 0.6648
Mexico peso-a 0.0561 17.8295 14.0
Pakistan rupee 0.0095 105.400 1.0 Oman sul rial 2.5971 0.3850 0.02 Hong Kong 7.8067 10.5882 8.0489 0.0695 ... 9.3200 6.3327 6.1961
Peru sol 0.3078 3.2490 3.1
Philippines peso 0.0196 50.959 2.7 Qatar rial 0.2694 3.713 2.0 Japan 112.3500 152.3700 115.8400 ... 14.3920 134.1300 91.1300 89.1800
Uruguay peso-e 0.0346 28.880 1.6
Singapore dollar 0.7407 1.3500 6.7 Saudi Arabia riyal 0.2666 3.7503 0.01 0.9698 1.3154 ... 0.0086 0.1242 1.1580 0.7868 0.7697
Venezuela bolivar 0.099858 10.01 0.2 Switzerland
South Korea won 0.0008829 1132.57 6.2 South Africa rand 0.0754 13.2683 3.1
U.K. 0.7372 ... 0.7602 0.0066 0.0944 0.8803 0.5981 0.5852
Asia-Pacific Sri Lanka rupee 0.0065454 152.78 2.9 Close Net Chg % Chg YTD % Chg
0.7936 1.2601 9.2 Taiwan dollar 0.03311 30.205 U.S. ... 1.3564 1.0311 0.0089 0.1281 1.1939 0.8111 0.7936
Australia dollar 6.9 WSJ Dollar Index 85.60 0.02 0.03 7.90
China yuan 0.1516 6.5942 5.0 Thailand baht 0.03020 33.110 7.5 Sources: Tullett Prebon, WSJ Market Data Group Source: Tullett Prebon

Key Rates Top Stock Listings 4 p.m. New York time

Latest 52 wks ago % YTD% % YTD% % YTD%
Libor Cur Stock Sym Last Chg Chg Cur Stock Sym Last Chg Chg Cur Stock Sym Last Chg Chg Asia Titans 50
One month 1.23722% 0.52528% TakedaPharm 4502 6091.00 -0.25 25.98 CHF RocheHldgctf ROG 249.00 0.81 7.05 Last: 168.65 t 1.30, or 0.76% YTD s 19.6%
Three month 1.32833 0.85672 Asia Titans HK$ TencentHoldings 0700 347.20 0.23 83.03 RoyDtchShell A RDSA 2165.50 0.49 -3.43
Six month 1.49100 1.24833 HK$ AIAGroup 1299 60.20 0.25 37.60 TokioMarineHldg 8766 4556.00 0.57 -5.00 SAP SAP 91.74 -0.11 10.78 High 170
One year 1.76761 1.56133 83.87 1.91 9.06
AU$ AustNZBk ANZ 29.76 -0.90 -2.17 ToyotaMtr 7203 6738.00 0.52 -2.04 Sanofi SAN Close 165
Euro Libor AU$ BHP BHP 25.99 -0.76 3.71 AU$ Wesfarmers WES 40.93 -0.80 -2.87 SchneiderElectric SU 72.81 0.71 10.13 Low t 160
One month -0.40500% -0.37400% HK$ BankofChina 3988 4.01 0.50 16.57 AU$ WestpacBanking WBC 31.28 -0.38 -4.05 Siemens SIE 117.45 1.29 0.56
Three month -0.37871 -0.32243 HK$ CKHutchison 0001 100.20 -0.40 13.99 AU$ Woolworths WOW 25.30 0.08 4.98 Telefonica TEF 9.07 -0.72 2.88 50day 155
Six month -0.30500 -0.21757 AU$ CSL CSL 132.81 -0.70 32.27 Total FP 45.88 0.46 -3.93 moving average 150
One year -0.21943 -0.07186 Canon 7751 3789.00 -0.53 14.99 Stoxx 50 CHF UBSGroup UBSG 16.50 1.73 3.45
145
Euribor CentralJapanRwy 9022 19535 0.05 1.59 Unilever UNA 49.52 -1.48 26.61
CHF ABB ABBN 23.98 1.18 11.64
One month -0.37300% -0.37100% HK$ ChinaConstructnBk 0939 6.67 -0.15 11.73 Unilever ULVR 4261.50 -2.07 29.43 23 30 7 14 21 28 4 11 18 25 1 8 15
ASMLHolding ASML 138.10 -0.36 29.49
Three month -0.33000 -0.30100 HK$ ChinaLifeInsurance 2628 23.85 ... 18.07 Vinci DG 80.53 0.16 24.47 July Aug. Sept.
AXA CS 24.86 0.73 3.67
Six month -0.27200 -0.20100 HK$ ChinaMobile 0941 80.15 -0.68 -2.49 VodafoneGroup VOD 208.10 -0.95 4.13
AirLiquide AI 109.30 1.16 3.45
One year -0.17100 -0.05900 HK$ ChinaPetro&Chem 0386 5.90 0.17 7.27 CHF ZurichInsurance ZURN 288.40 0.07 2.85
185.50
Yen Libor AU$ CmwlthBkAust CBA 76.07 -0.29 -7.69


Allianz
AB InBev
ALV
ABI 98.05
0.73 18.15
-0.57 -2.49 DJIA Stoxx 50
One month -0.04393% -0.08271% EastJapanRailway 9020 10230 0.79 1.29 AstraZeneca AZN 4768.50 0.35 7.46 Last: 3122.55 s 11.14, or 0.36% YTD s 3.7%
Three month -0.02750 -0.02064 Fanuc 6954 22845 0.26 15.29 BASF BAS 88.43 0.66 0.14
$ AmericanExpress AXP 88.45 0.02 19.40
Six month 0.00700 0.00571 Hitachi 6501 793.20 -0.10 25.51 BNP Paribas BNP 66.72 1.01 10.19
$ Apple AAPL 153.39 -1.72 32.44 3275
One year 0.10614 0.10457 TW$ Hon Hai Precisn 2317 111.00 4.23 31.83 BT Group BT.A 282.55 -1.50 -22.99
$ Boeing BA 256.04 0.23 64.47
$ Caterpillar CAT 124.79 -0.05 34.56 3200
Offer Bid HondaMotor 7267 3331.00 0.63 -2.46 BancoBilVizAr BBVA 7.50 1.71 18.16
KRW HyundaiMtr 005380 141500 -0.35 -3.08 $ Chevron CVX 116.46 0.08 -1.05 3125
Eurodollars BancoSantander SAN 5.69 1.19 14.80
HK$ Ind&Comml 1398 5.88 0.51 26.45 $ CiscoSystems CSCO 32.70 0.31 8.21
One month 1.3300% 1.2300% Barclays BARC 190.40 2.42 -14.79 3050
$ Infosys INFY 14.60 -1.62 -1.55 $ Coca-Cola KO 45.41 -0.81 9.53
Three month 1.4000 1.3000 Bayer BAYN 110.40 0.50 11.37
2975
JapanTobacco 2914 3683.00 -1.05 -4.19 $ Disney DIS 98.89 -0.32 -5.11
Six month 1.5400 1.4400 BP BP. 463.50 0.89 -9.05
$ DowDuPont DWDP 70.32 -0.13 4.67
One year 1.8100 1.7100 KDDI 9433 2970.50 0.05 0.37 BritishAmTob BATS 4565.00 -0.89 -1.22 2900
Mitsubishi 2592.00 -0.78 4.10
$ ExxonMobil XOM 79.90 -0.81 -11.48
Latest 52 wks ago 8058 Daimler DAI 66.87 0.44 -5.44 $ GeneralElec GE 24.76 1.81 -21.65 23 30 7 14 21 28 4 11 18 25 1 8 15
MitsubishiElectric 6503 1760.00 -1.07 8.01 DeutscheTelekom DTE 15.34 -2.17 -5.27 $ July Aug. Sept.
Prime rates GoldmanSachs GS 231.29 0.65 -3.41
MitsubishiUFJFin 8306 719.40 1.71 -0.11 Diageo DGE 2420.50 -0.25 14.72 $
U.S. 4.25% 3.50% HomeDepot HD 159.29 0.38 18.80
Mitsui 8031 1688.00 -0.21 5.04 ENI ENI 13.74 0.73 -11.18 $
Canada 3.20 2.70 Intel INTC 37.20 0.36 2.58
198.20 1.17 -5.53 1468.00
Japan
Hong Kong
1.475
5.00
1.475
5.00


Mizuho Fin
NTTDoCoMo
8411
9437 2574.50 -0.17 -3.32


GlaxoSmithKline
Glencore
GSK
GLEN 346.55
0.96 -6.02 $
-0.63 24.95 $
IBM
JPMorganChase
IBM
JPM
145.32
95.03
-0.38 -12.45
0.45 10.13
Dow Jones Industrial Average P/E: 20
AU$ NatAustBnk NAB 31.00 -0.45 1.08 HSBC Hldgs HSBA 721.60 -0.19 9.85 $ J&J JNJ 131.81 -1.06 14.41 Last: 22359.23 t 53.36, or 0.24% YTD s 13.1%
Policy rates
ECB 0.00% 0.00%
Nintendo 7974 41750 -2.66 70.13 INGGroep INGA 15.37 1.19 14.92 $ McDonalds MCD 159.05 -0.52 30.67
Britain 0.25 0.25
NipponTeleg 9432 5106.00 -0.39 3.95 ImperialBrands IMB 3214.50 -1.35 -9.26 $ Merck MRK 65.61 -0.27 11.45 22500
Switzerland 0.50 0.50
NissanMotor 7201 1158.00 0.39 -1.49 IntesaSanpaolo ISP 2.97 1.30 22.42 $ Microsoft MSFT 74.21 -0.97 19.42
Panasonic 6752 1642.00 -1.38 38.04 LVMHMoetHennessy MC 229.85 -0.07 26.71 $ Nike NKE 53.20 -0.67 4.66
22000
Australia 1.50 1.50
HK$ PingAnInsofChina 2318 62.60 0.32 61.34 LloydsBankingGroup LLOY 67.45 2.65 7.90 $ Pfizer PFE 35.98 -0.03 10.78
U.S. discount 1.75 1.00 21500
Fed-funds target 1.00-1.25 0.25-0.50
$ RelianceIndsGDR RIGD 51.20 -1.73 62.28 LOreal OR 176.60 -0.95 1.85 $ Procter&Gamble PG 92.63 -1.88 10.17
Call money 3.00 2.25
KRW SamsungElectronics 005930 2640000 1.11 46.50 NationalGrid NG. 947.90 -0.34 -8.69 $ 3M MMM 210.48 -0.01 17.87 21000
Seven&I Hldgs 3382 4350.00 -0.66 -2.31 CHF Nestle NESN 80.70 -0.25 10.47 $ Travelers TRV 121.53 -0.31 -0.73
Overnight repurchase rates 20500
U.S. 1.05% 0.43%
SoftBankGroup 9984 9147.00 -0.92 17.80 CHF Novartis NOVN 82.95 0.06 11.94 $ UnitedTech UTX 114.49 0.34 4.44
Euro zone n.a. n.a.
Sony 6758 4193.00 -1.18 28.03 DKK NovoNordiskB NOVO-B 306.40 0.99 20.30 $ UnitedHealth UNH 195.25 -0.26 22.00 23 30 7 14 21 28 4 11 18 25 1 8 15
Sumitomo Mitsui 8316 4294.00 0.59 -3.72 Prudential PRU 1773.50 0.40 8.97 $ Visa V 105.33 0.34 35.00 July Aug. Sept.
Sources: WSJ Market Data Group, SIX HK$ SunHngKaiPrp 0016 131.80 -0.83 34.49 ReckittBenckiser RB. 6704.00 -1.24 -2.64 $ Verizon VZ 48.92 -1.13 -8.36 Note: Price-to-earnings ratios are for trailing 12 months
Financial Information, Tullett TW$ TaiwanSemiMfg 2330 221.00 -0.23 21.76 RioTinto RIO 3465.50 -1.18 9.72 $ Wal-Mart WMT 80.00 -0.62 15.74 Sources: WSJ Market Data Group; Birinyi Associates
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B8 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

MARKETS
For Sale Abroad: U.S. Oil

AMELIE QUERFURTH/AGENCE FRANCE-PRESSE/GETTY IMAGES

Hurricane hits price loaded by smaller vessels, their
Mind the Gap larger volumes make longer
of West Texas crude, U.S. oil is trading below global crude by the most in two years. journeys more economical. An-
boosting its appeal That is helping boost American oil exports. alysts at McQuilling Services
expect at least 10 of these
to refiners overseas Crude-oil price
tankers to be loaded from the
$60 a barrel U.S. next month, a record.
BY ALISON SIDER Brent crude One big obstacle to more
AND LYNN COOK 55 exports could soon be re-
solved. The Louisiana Offshore
U.S. oil is trading at the big- 50 Oil Port is the one place in the
gest discount to the global U.S. that is deep enough for
45
price in two years, helping ex- supertankers that can most
tend a boom in exports of crude U.S. crude profitably make the journey to Shares of Commerzbank rose 3.5%, adding to Wednesdays gains.
40
from American shale fields to Asia. The LOOP is looking to
J F M A M J J A S
refiners in Europe and Asia.
After Hurricane Harvey ham-
mered the Gulf Coast last
month, the price of West Texas
U.S. crude discount
$6 a barrel
add the capability to load
those tankers next year.
U.S. and global oil prices
had already drifted apart in
Bank Shares Gain
Intermediate crude, the U.S. ref-
erence price, sank to as much
as $6.30 a barrel below its Eu-
4
2
August, and during Harveys
peak, WTI tumbled. More than
a quarter of total U.S. refining
In Europe and Asia
ropean counterpart, Brentthe 0 capacity was offline as plants BY MICHAEL WURSTHORN compared with 57.7% a day
widest gap since August 2015. curtailed operations, causing AND RIVA GOLD earlier.
J F M A M J J A S
Harvey has passed, but ana- demand for U.S. crude to Officials also said they
lysts say the storm will re- U.S. crude exports, weekly dwindle. Some refineries are Bank shares climbed Thurs- would begin shrinking the U.S.
shape global crude flows for 1.5 million barrels a day Hurricane Harvey still struggling to return. day as investors ramped up central banks portfolio of
months. The difference be- disruption At the same time, global oil bets that the Federal Reserve bonds in October.
tween U.S. oil and Brent, the 1.0 prices were on an upswing af- would tighten monetary pol- The yield on the benchmark
international benchmark, at 0.5 ter more than eight months of icy. 10-year U.S. Treasury note
$5.88 as of Thursday, is key in production cuts by the Organi- THURSDAYS The Stoxx edged up to 2.278% from
determining when it is profit- 0 zation of the Petroleum Ex- MARKETS Europe 600 2.276% on Wednesday, after
able to ship oil from U.S. ports J F M A M J J A S porting Countries and strong rose 0.2% to slipping in earlier trading.
to places overseas. Sources: WSJ Market Data Group (prices); summer demand. Planned 382.88, led Yields move inversely to
A difference of at least $4 Energy Information Administration (exports) THE WALL STREET JOURNAL. maintenance over the summer by a 1.4% advance in lenders. prices.
makes it attractive for a refiner also limited output from one Gains in banks and insurance Gold fell 1.6% to $1,290.60 a
in countries such as China or crease American shipments, global head of oil research at of the key oil fields that deter- companies also helped boost troy ounce, while London-
South Korea to buy oil from the U.S. had already become a Socit Gnrale. mines the price of Brent. Euro- Japans Nikkei Stock Average listed copper futures fell 1.7%.
shale producers in Texas and disruptive force in global en- Leasing oil tankers can cost pean refiners cranked up out- by 0.2%, while U.S. stocks U.S. crude prices fell 0.3% to
North Dakota, said R.T. Dukes, ergy markets, sending oil over- anywhere from under $1 a bar- put to pick up the slack for slipped on declines in technol- $50.55 a barrel.
an oil expert with consulting seas after a ban on most ex- rel to a few dollars, depending shuttered U.S. plants. ogy and consumer-staple Shares of consumer-staple
firm Wood Mackenzie. ports was lifted at the end of on the length of the trip. For Harvey all but stopped the stocks. companies were among the
Get to a $4 spread, and 2015. In recent years, the rise instance, taking oil from Texas flow of oil to and from the The Dow Jones Industrial S&P 500s biggest decliners,
you can take it anywhere in of the U.S. shale industry has to Asia is more expensive since U.S., but crude exports jumped Average lost 53.36 points, or falling 1% in late trading.
the world, he said. pushed oil prices down world- it is a longer voyage than to back up by 775,000 barrels a 0.2%, to 22359.23, snapping a Beauty-products maker Coty
Take Occidental Petroleum wide. Exports have become a Argentina or the Netherlands. day to 928,000 barrels a day nine-day winning streak. The fell 3.8%, while Procter & Gam-
Corp., a major U.S. exporter relief valve for U.S. drillers, After tanker owners expanded in the first two weeks of Sep- S&P 500 fell 0.3%, while the ble fell 2%. Technology stocks
and large producer in the who have continued to pump their fleets in recent years, tember, as ports along the Gulf tech-heavy Nasdaq Composite also came under pressure, los-
Permian Basin of West Texas. despite relatively low prices. shipping rates have fallen reopened following the storm. fell 0.5%. ing 0.6%.
Occidental is shipping more Because many big Gulf Coast sharply. They are down 20% to Crude exports are likely to Fed officials kept the door Shares of Commerzbank
crude than ever as lower U.S. refiners are largely geared to 30% in the past year, according surge to 1.3 million barrels a open for a December interest- rallied 3.5%, extending gains
prices boost demand for oil process heavy crude, such as to shipping consultancy Mc- day in the last three months of rate rise at the conclusion of Wednesday following a Reu-
from the Permian. The com- the output from Canada and Quilling Services LLC. the yearmore than double their September meeting, and ters report that Italys Uni-
pany recently struck new deals South America, they have con- For now, the WTI-Brent the year-earlier period, ana- higher rates tend to boost Credit is interested in merging
with customers in South Ko- tinued to import barrels, while spread is wide enough to offset lysts at Energy Aspects say. lending profitability. Fed-fund with the state-backed lender.
rea, India, China and countries some of the output from shale the expense of loading super- Macquarie analysts antici- futures tracked by CME Group, But the German government
in Southeast Asia, said Cyn- formations has started to flow tankers that are too heavy for pate the U.S. crude discount which are used by investors to favors Commerzbank tying up
thia Walker, an Occidental se- abroad to refiners set up to relatively shallow Texas ports, will shrink to $3 a barrel in bet on central bank policy, with Frances BNP Paribas,
nior vice president. process the light, sweet variety. consultancy JBC Energy said. the next two to three weeks. showed investors now see a Reuters reported Thursday.
While the recent discount The export window is wide While the huge tankers gener- Stephanie Yang 73.4% chance of higher U.S. in- BNP shares rose 1%, while Uni-
on WTI crude is poised to in- open, said Michael Wittner, ally have to wait offshore to be contributed to this article. terest rates by the end of 2017, Credit gained 2%.

Email: [email protected]
HEARD ON THE STREET FINANCIAL ANALYSIS & COMMENTARY WSJ.com/Heard

Fed Paves Way for ECB to Follow OVERHEARD Johnson

Mattheys
The central bank choir is Yellens term as chairwoman Given the way that inves-
A New Plateau?
getting back in tuneand
the Federal Reserves signals
that it is pushing on to
Euro effective exchange-rate index, weighted against 38 trading partners*
expires early in 2018. And as
the pace of balance-sheet re-
duction builds, it may be-
tors are obsessing over the
Federal Reserves most recent
economic projections, it is a
Leap of Faith
higher rates and a smaller 116 come a bigger challenge for good time to look back on Electric cars could ac-
balance sheet may make life markets than it appears at where they were 10 years count for 4% of global car
easier for the European Cen- 114 present. ago. sales in 2025 (source: BP,
tral Bank in its own exit But for now, stronger In September 2007, it was IHS). Or should that be 25%
from emergency monetary 112
growth means there is room clear something was amiss (UBS, Roland Berger)?
policy. for central banks to with- with the U.S. economy. Hous- How are executives, let
The Fed was slightly more draw stimulus gently: Emer- ing prices were falling and alone investors, supposed to
hawkish Wednesday than the 110 gency settings no longer look mortgage defaults were ris- place their bets with this
market was expecting, by appropriate. ing. kind of uncertainty? London-
continuing to indicate a fur- 108 Indeed, faced with a High gasoline prices were listed chemical group John-
ther rate rise in 2017 and brighter outlook, policy can pinching consumers and the son Matthey, which makes
three in 2018. That pushed remain very accommodative job market was deteriorating. most of its money selling
106
the dollar and U.S. bond even if it is tightened, cen- Fed policy makers were catalytic converters for en-
yields higher. 2016 17 tral bankers are suggesting. worried: At their meeting that gine cars, but is also devel-
But the Fed is still moving *Data through Wednesday Source: European Central Bank THE WALL STREET JOURNAL. Monetary policy has to month they cut rates. But oping cathodes for electric-
gradually and indeed, sig- move in order to stand still, their projections show they car batteries, showed the
naled a slightly lower longer- be less of a one-way bet weighted exchange rate ap- is how Bank of England Gov. expected the storm to pass way Thursday: Admit the fu-
run interest rate of 2.75% against the euro than it has pears to have found some Mark Carney described it quickly. ture is unknown and sign the
than the 3% indicated in been in recent months. stability, helped by a re- this week. They thought the unem- check anyway.
June. That eases the way for bound in the U.K. pound In effect, a more robust ployment rate would only Johnson Matthey pre-
That should mean Trea- ECB policy makers to wind thanks to the Bank of Eng- economic picture means inch up a bit over the next sented analysts with a slide
sury yields and the dollar down their bond-buying pro- lands own signals that rates monetary policy doesnt several years, never topping extrapolating the growth of
dont rise too sharply, which gram: The rise in the euro may rise. have to do so much heavy 5%. The economy would ex- electric cars into the cathode
could potentially upset the had started to complicate The outlook for policy re- lifting. pand 2.2% in 2008 before market, which could be
stronger growth picture that that task by making the mains finely balanced. That aim may be easier to picking up to 2.5% in the fol- worth anything from $15 bil-
is helping markets absorb ECBs inflation target harder A sharp rise in inflation achieve if central banks are lowing years. Inflation would lion to $100 billion by 2025.
central bank plans to reduce to hit. would be a big problem, going in the same direction settle into just under a 2% Johnson Matthey announced
stimulus. Had the Fed backed down, though for now that remains at the same time. The Feds rate. it would spend up to 200
For the ECB, the Fed looks the euro might have risen an outlier. persistence has opened up Three months later, the re- million ($269.9 million), or
to be making the right deci- further. There is also uncertainty that path. cession began. about three-quarters of an-
sion, as the dollar may now But the euros trade- about Fed policy, given Janet Richard Barley nual capital expenditures, on
a cathode plant.
Johnson Mattheys shares

Why Its So Hard for Europes Big Banks to Do Big Deals rose 15% Thursday, though
that may have more to do
with robust predictions for
Everyone wants bank deals deals since the crisis, but the The irony is German bank- more German industrial cus- its catalytic-converter busi-
in Europe. The problem is European Central Bank and ing has among the weakest Unhappy Returns tomers, but like other big ness. Investors had been too
finding one acceptable to in- eurozone banking regulator profitability and greatest need Pretax income return on assets banks, it has long been wary quick to write this off as Eu-
vestors, executives, regulators are both banging the drum for for reform. Data from the of large deals because growing ropes diesel scandal
and politicians. consolidation. World Bank show they have 2% Czech in size and complexity should plumbed new depths this
Commerzbank, Germanys The reason is poor profit- weaker average returns than Republic mean higher capital require- summer.
second-biggest listed bank, is ability across a sector that is banks in many other countries 1 U.S. ments. The reality, for Johnson
again the subject of takeover hampered by ultra-low inter- and a recent survey by Ger- France It makes sense for someone Mattheyas for car makers
talk after reports that the gov- est rates, high costs and too man regulators found banks 0 U.K. to buy Commerzbank: Its valu- like General Motors and
Germany
ernment wants to unload the many branches. The ECB sees expected profitability to keep ation has barely risen above Volkswagenis that they
15.6% stake it took during the consolidation as an answer worsening. 1 half its book value since 2011. have to invest as if electric
last financial crisis. within countries, but it also UniCredit would make a 2010 But for a deal to happen, poli- cars were just around the
UniCredit of Italy and BNP wants cross-border mergers to sensible owner of Commerz- Note: 2015 is latest data available. ticians will have to relax about corner. If the new technology
Paribas of France have both help create a truly single-mar- bank: It already has a big Ger- Source: World Bank sharing risks in the eurozone, makes up just 4% of sales in
been mooted as potential buy- ket for eurozone banking. man mortgage and commercial THE WALL STREET JOURNAL. executives will have to be re- 2025, as electric-car skeptics
ers, with one German newspa- However, national politi- bank in HVB. A combination assured it wont cost them ex- predict, the companies will
per reporting that the latter cians, especially in Germany, could cut capacity in German bank is extremely unlikely to tra capital and most of all, in- have wasted a lot of money.
would be preferred by Berlin. are resistant because they banking, reducing costs for consider a deal until its own vestors will have to be They must figure that
Deutsche Bank may also be in- dont want their taxpayers to UniCredit and improving the restructuring is done, which is convinced that German bank- beats having their lunch
terested, although it has bat- end up paying for another competitive landscape. expected to take until the end ing is worth investing in at all. eaten should the optimists
ted away such talk. countrys irresponsible bor- But this would require of 2019. Dont hold your breath. turn out to be right.
Europe has had no big bank rowing. much patience. The Italian BNP could do with gaining Paul J. Davies Stephen Wilmot
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

Why Its time to get

in-the-know serious about
drinkers go for becoming a
Spanish cider watch nerd
W4 W3

EATING | DRINKING | STYLE | FASHION | DESIGN | DECORATING | ADVENTURE | TRAVEL | GEAR | GADGETS
2017 Dow Jones & Company. All Rights Reserved. THE WALL STREET JOURNAL. Friday - Sunday, September 22 - 24, 2017 | W1

TAKE MONDAY OFF

A Birmingham
Grand Slam
Packed with winning diversions, a whirlwind long weekend
in Alabamas biggest city reveals an American revival ANNA MAZUREK FOR THE WALL STREET JOURNAL

DAYBREAK IN ALABAMA Clockwise from top left: Railroad Park, which opened in 2010 in downtown Birmingham, Ala.; the Negro Southern League Museum, which holds the largest collection of
artifacts from the Negro League; Hot and Hot Fish Clubs tomato, fried okra and smoked bacon salad; the LightsRail installation under the 18th Street viaduct.

DAY ONE // FRIDAY sofas and wall of mir- Bar & Grill. Chef/owner 11th Ave. S., high-
BY MARLI GUZZETTA
rored subway tile, the Frank Stitt, a Bham na- landsbarandgrill.com).
5 p.m. Fly into to Bir- elevators original art- tive who trained with

I
N THE JUTTING chin of the Appalachians, near Ala- mingham-Shuttlesworth deco doors are the Alice Waters and Rich- 9:30 p.m. Take 18th
bamas mineral-rich Red Mountain, men made the pig Airport, where a line at same ones that opened ard Olney, returned Street through the art
iron that girded Americas industrial revolution. The the rental-car counter to carry Hank Williams home in 1980 and installation Light-
city that appeared around them, almost out of no- is as unlikely as the up to his last sleep on opened the restaurant Railsa rainbow-lit
where, exploded from about 3,000 people in 1880 to possibility youll hit earth in 1952 (from a couple of years later. tunnel illuminated by
26,000 just a decade later. By the early 1900s, city stakehold- traffic along the easy about $210 a night, red- His classic French and artist Bill FitzGibbons
ers had christened Birmingham, Ala., the Magic Cityand 15-minute drive to montbirmingham.com). modern Californian on your way to the Col-
the moniker stuck. Even now, the name of seemingly every downtowns historic techniques elevated lins bar. Under a ceiling
business in town, from Magic City Pet Care to Magic City Redmont Hotel. Two 6 p.m. Order a pre-din- Southern flavors, giv- hung with paper planes,
Law, recalls those boomtown roots. These days, the old iron red-coated bellmen will ner drink at the Red- ing a city recently gut- sip tailor-made concoc-
town is forging another radical transformation. The local- welcome you to the in- monts gothic-glam ted by lost industry a tions for a rather af-
maker renaissance sweeping the South is redefining down- timate lobby, where a rooftop bar and watch success to rally fordable $8-$12 (2125
town Birmingham as a 21st-century creative hub, refiring its white-jacketed bar- the sun set behind the around. Soon enough 2nd Ave. N, thecollins-
peanut roasters, installing laudable restaurants in once- tender pours days-end hotels classic sign. he began racking up bar.com)
crumbling storefronts and seeding green space in the rusted cocktails under a 10- national food awards.
footprint of old rail industry. Dont expect the gentility of foot-long chandelier 7:30 p.m. Drive or Pastry chef Dolester 10:30 p.m. Up for one
Charleston or Savannah. This is a city that holds weddings that was refurbished in take a car service 2 Miles, known for her more drink? Around the
and music festivals inside an abandoned iron furnace. But the 2015 renovation. miles to the Five lemon meringue tart, corner, find your way to
unapologetic grit and a fair share of alchemy have long been Beyond the reception Points neighborhood is also contending for the uniquely entertain-
Birminghams biggest draws. areas gunmetal velour for dinner at Highlands best in her class (2011 Please turn to page W2
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
W2 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

OFF DUTY

THREE DAYS IN URBAN APPALACHIA

Continued from page W1
ing Atomic Bar & Lounge. In the
60s pop-art lounge, your fellow pa-
trons may be wearing costumes
they borrowed from behind the bar.
If youre not ready for that much
fun, the Sex Panther cocktail comes
with a more discreet adornment, a
lick em and stick em tattoo (2113
1st Ave. N, theatomiclounge.com).

DAY TWO // SATURDAY

9 a.m. Start your morning at Feast

and Forest, a sunny loft cafe. Diners

ANNA MAZUREK FOR THE WALL STREET JOURNAL; MAP BY JAMES GULLIVER HANCOCK
sit elbow-to-elbow noshing on
breakfast sandwiches with apple
butter and tomato jam or stone
ground grits with poached eggs and
cremini mushrooms (212 24th St. N,
feastandforest.com).

10 a.m. Drive a mile to the old Dr

Pepper Syrup Plant and Bottling
Company, where the Market at Pep-
per Place showcases local growers,
bakers, chefs and such. The Bir-
mingham Candy Company, for one,
makes everything from scratch
(2829 2nd Ave. S, pepperplacemar-
ket.com). Across the parking lot, is
Southern Living-alum Charlie Thig-
pens Garden Gallery, with an artful
assortment of planters and sculp-
tures (2805 2nd Ave. S, charliethig-
pensgardengallery.com). ALABAMA GLAMOUR Winslet and Rhys, a modern mercantile shop in Birminghams Avondale neighborhood, specializes in small-batch handmade goods.

10:30 a.m. Take First Ave N into the

citys industrial borderlands and see
the ancient red bones of Sloss Fur-
nace. After the Civil War, pig iron
(easily transportable iron) created
Birmingham, and Sloss Furnace cre-
ated the pig iron. After demand
dried up in the 1970s, Sloss began
its second act as a romantic, if
slightly spooky industrial ruin and
National Historic Landmark. Today,
the Sloss Music & Arts Fest holds
concerts at the foot of a blast fur-
nace every summer (slossfest.com).
Historian Richard Neely leads excel-
lent tours on the second weekend of
each month (20 32nd St. N, slossfur-
naces.com).

11:30 a.m. Three miles east, musi- PEDAL TO

cian Duquette Johnston and his THE METAL
family draw from their travels to Clockwise from
stock their shop, Club Duquette, a to grab a scoop of ice cream made top left: The
hipster general store, with every- with seasonal ingredients at Big Barber Vintage
thing from biodynamic Californian Spoon Creamery (4000 3rd Ave. S, Motorsports
chocolate to French pocket knives bigspooncreamery.com). Next door, Museum; Sloss
(17 55th Pl. S., clubduquette.co). Winslet and Rhys is a modern mer- Furnaces, a
Across the street, Armand Mar- cantile store that also sells works by National Historic
gjekas Open Shop Woodlawn sells artists from the co-working space Landmark and
mens designer clothing, displayed behind the shop (winsletand- now a popular
so fastidiously it looks like a mini- rhys.com). concert venue;
malist art gallery (5529 1st Ave. S., the 1925
openshopwoodlawn.com). 3:30 p.m. Drive 10 minutes west Redmont hotel
and park near Regions Field. On its in downtown
12:30 p.m. If youre up for a fresh east side, the Negro Southern Birmingham.
pressing of Jethro Tull: The String League Museum displays uniforms
Quartets and maybe a trim, some and other artifacts from the likes of 2 p.m. Its a quick drive back to- drive (or cab) to the tiny, nearly
10,000 new and used vinyl albums Willie Mays and Satchel Paige (both ward Five Points. At Galley and empty downtown of Bessemer,
at Seasick Records (5508 Crestwood players for the Birmingham Black Garden, starched-white tablecloths Ala., unexpected seat of a James
Blvd., seasickbham.com) share a Barons), who changed a segregated greet you for Sunday brunch in the Beard winner for American Clas-
space with the barber chairs of America through baseball (120 16th stately, historic Merritt House. The sics. At 110 years old, the Bright
Newmans Classic Cuts (newman- St. S, birminghamnslm.org). french toast is stuffed with Star is Alabamas oldest continu-
sclassiccuts.com). whipped local goat cheese, and the ously operating restaurant. The
5 p.m. Two blocks north, folks will Marble Ring. Walk through the bowl of Gulf shrimp and stone- Greek-meets-Southern eatery dou-
1:30 p.m. A mile and a half west, be squeezing R&R from the last phone booth and youll find pa- ground grits can hold its own any- bles as a sort of museum for Ala-
youll find the neighborhood of drops of sunlight at the thriving trons taking their highballs in where in the South (2220 Highland bama college football, whose
Avondale, which old-timers remem- Railroad Park (1600 1st Ave S, rail- high-backed chairs under chande- Ave. S, galleyandgarden.com). coaches and players often visit. Sit
ber as the long-ago home of Miss roadpark.org). Follow the streams liers (430 41st St S, hotdiggity- in the Bear Bryant booth and or-
Fancy, an elephant who resided at to the corner of First Ave S and dogsbham.com). Next door, funky 3 p.m. Downtown, at the Civil der the time-tested fried snapper
Avondale Parks now-closed zoo. 14th Street S. Youll see the Minor Parkside is a beloved neighbor- Rights Institute, youll find the cell throats served with a lemon
Since the parks renovation in 2011, League Regions Field with its im- hood bar with an Airstream trailer bars behind which Martin Luther wedge on a lone kale leaf garnish
the neighborhood has attracted a possible-to-miss Birmingham sign on its back patio that serves King Jr. wrote his Letter from Bir- (304 19th St. N, thebright-
clutch of good restaurants and wa- on the steel facade and overlooking dressed-up bar food (4036 5th mingham Jail, five months before star.com).
tering holes. Among the most cher- the Good People Brewing Company Ave. S, hotboxbhm.com). If youd a KKK bombing took the lives of
ished is Saws Soul Kitchen, a tiny across the street. Head there for a prefer more privacy, head to the four black children at the 16th
smokehouse. Alabama barbecue is frosty pull of their Coffee Oatmeal rails for a drink at Carrigans Pub- Street Baptist Church across the DAY FOUR // MONDAY
known for its white saucea dance Stout (114 14th St. S, goodpeo- lic House, a cozy, repurposed street from the institute (520 16th
of mayo and vinegarand the wings plebrewing.com). warehouse where you can watch St N, bcri.org). 9:30 a.m. After you check out,
here will show you why locals insist the trains pass (2430 Morris Ave., wake up with a cinnamon and Ala-
its far superior to barbecue in other 8 p.m. After freshening up back at carriganspub.com). 4 p.m. In the Birmingham Museum bama honey latte at cult Southern
states (215 41st St. S, sawsbbq.com). the Redmont hotel, drive 10 min- of Art, take in one of the most roaster Revelator Coffee, a few
utes to Hot and Hot Fish Club, comprehensive collections in the blocks from your hotel (1826 3rd
2:15 p.m. After lunch, walk a block helmed by James Beard winner DAY THREE // SUNDAY Southeast, including the largest Ave. N, revelatorcoffee.com).
Chris Hastings for an inspired menu Wedgwood exhibit outside of Eng-
of fresh Gulf seafood (2180 11th Ct. 9 a.m. Wear something you can land (2000 Reverend Abraham 10 a.m. Make a quick stop at the
S, hotandhotfishclub.com). move in (or fill up in) and return to Woods Jr. Blvd., artsbma.org). Peanut Place, where the antique
Avondale. Saturns coffee bar, Satel- roasters have been firing since the
9 p.m. Its back to Avondale. At in- lite, serves pillowy brioche Hero 5:30 p.m. Drive to Vulcan Park, early 1900s. Grab a warm bag of
die music venue Saturn, lights dim doughnuts on Sunday mornings un- named for the god of the forge, spicy Cajun peanuts for the flight
for acts like Neko Case, Vince Sta- til theyre all gone. and make a tourists pilgrimage to home (2049 Morris Ave.).
ples or Kishi Bashi (200 41st St. S, see the 56-foot cast-iron statue of
saturnbirmingham.com). On the 10 a.m. About 10 miles southwest, Vulcan. An elevator beside the 12 p.m. A half mile east at Yo
corner, above Fancys on 5th, Hot the mining site that fueled Birming- statues towering pedestal will Mamas, the crunchy, salty-sweet
Diggity Dogs conceals the entrance hams industrial growth spurt, now ferry you 11 stories up to an obser- fried chicken and waffles might
to a 20s-style speakeasy named abandoned, has been reborn as Red vation platform with a panoramic ruin you for life (2328 2nd Ave. N,
Mountain Park, with 15 miles of view over Birmingham (1701 Valley yomamasrestaurant.com).
WING NUTS trail shaded by longleaf pine, hick- View Dr., visitvulcan.com).
From top: An ory and oak (2011 Frankfurt Dr., 1 p.m. Before heading to the air-
order of wings, redmountainpark.org). 7 p.m. Many city bars and restau- port, take the highway 20 miles
slathered in rants close on Sunday, which east of town to Leeds. Youll find
Alabamas 12 p.m. On the way back into town, means Birminghamians (and often the gleaming spoils of over 1,400
signature white stop to take in Joe Minters African their dogs) end the weekend at the painstakingly restored bikes and
barbecue sauce, Village in America from the curb. breweries. After the sun sets, drive cars set behind thick walls of pine.
at Saws Soul Mr. Minter has spent decades filling 15 minutes back to Avondale and Founded by Bham businessman
Kitchen; the land around his home with find a seat in the string-lit, back- George Barber, the Barber Vintage
Carrigans Public found-art sculptures enshrining na- yard block party at Avondale Motorsports Museum displays
House tional tragedies and acts of violence Brewing Co., where Miss Fancys some of the worlds rarest motor-
gastropub on against people of color. If Mr. Tripelis is always cold (201 41st St. bikes, including the mad-genius
Birminghams Minter sees you, he might come out S, avondalebrewing.com). Britten V1000 (6030 Barber Mo-
historic Morris to chat, spirit stick clanking at his torsports Pkwy., barbermu-
Avenue. side (931 Nassau Ave. SW.). 8:30 p.m. Next is a 30-minute seum.org).
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. Friday - Sunday, September 22 - 24, 2017 | W3

OFF DUTY
THE WATCH MAN HOROLOGICAL EXPERT MICHAEL CLERIZO ANSWERS YOUR TIMELY QUESTIONS

Watch Geek 101: A Beginners Guide

Q I just got my first serious
watch, a NOMOS Glashtte
jewelry pieces. Then take a break
from your studies for eye-candy:
Club Campus, and now everyone is The sites Legendary Watches grid
calling me a watch geek. What showcases 15 iconic designs, such
would it take to actually qualify as as Cartiers Tank, Rolexs Oyster
one? and Piagets Polo, with chirpy call-
outs and drool-worthy photos.

A New-watch lovers like yourself

often start out with a mission:
to learn everything possible about
Once youve digested this digital
feast, move on to printed matter.
Times a wasting. A couple books to
mechanical watches. Lets begin up your watch IQ: The Theory of
with a reality check. True watch ex- Horology by Charles-Andr Rey-
pertise involves mastering several mondin, et al, is a textbook thats
disciplines, from engineering and required reading at watchmaking
metallurgy to esoteric gemology schools, but you may find it too
and oddly named tribology (the technical. For a less-intimidating
study of friction), to mention only a tome, try The Wristwatch Hand-
few. book: A Comprehensive Guide to

MAIN ILLUSTRATION BY PETER OUMANSKI; SPOT ILLUSTRATION BY MICHAEL SLOAN

Im assuming youre looking for a Mechanical Wristwatches by Ryan
more manageable crash course. Be- Schmidt, published last year. Its an
gin your journey to geekdom at Ge- exhaustively researched reference
neva-based Fondation Haute Hor- work in a glossy coffee-table-book
logerie (hautehorlogerie.org). This guise for both newbie and veteran
industry website offers a wide enthusiasts. I give it points for the
range of information, from watch museum-quality photos and Mr.
wisdom to news in bite-sized bits. Schmidts clearheaded essays.
Click on Encyclopaedia on the The New York-based author
menu bar to access descriptions of holds a certificate from Fondation
all types of watches: mechanical, Haute Horlogerie, but Mr. Schmidts
quartz, complication or precious approach is far from haughty. He
prides himself on being brand-ag-
nostic, democratically covering
Pause your studies for an both large and small makers, vin-
tage and modern timepieces and
eye-candy break: drool- the widest price range from entry
worthy watch photos. level to the astronomically expen-
sive, as his website notes.
Taking an era-by-era approach is
a slim volume by Louis Nardin, also teric study material. Push forward whip-smart editor Frank Geelen By now, you are likely ready to
published last year, titled The to sites such as A Blog to Watch (who is based in the Netherlands), turn your attention to something
Magic Of Watches: A Smart Intro- (ablogtowatch.com) for erudite arti- pens razor-sharp watch commen- that doesnt tick, such as an Irish
duction To Fine Watchmaking. cles by David Bredan, a young tary with surgical precision. Setter or a Whisky Sour. But if
More thorough than its Cliffs Notes watch enthusiast based in Budapest. Bucking the digital-only publish- your quest for geekdom knows no
brevity might suggest, this nicely Or monitor the quips of British con- ing trend, the New York-based site bounds, get ready to travel. Watch
penned guide includes a timepieces trarian Angus Davies, whose enter- Hodinkee (hodinkee.com) known for devotees make pilgrimages to the
timeline that identifies key periods taining reviews on Escapement its stories on vintage watches, just worlds big watch fairs, Genevas
(the groovy Fantastic Plastic - Magazine (escapementmaga- did a print edition. The company Salon Internationale de la Haute
1980s, for example). Its a fun way zine.com) will help you develop also hired Joe Thompson, the dean Horlogerie and Baselworld, also in
to dip into watch history. your vocabulary about mechanics of American watch writers, who for Switzerland, but two smaller nota-
By now you will know a flying and watch design. 17 years was editor at WatchTime, ble fairs might suffice for fledgling
tourbillon from a fly-back chrono- Also instructive: Monochrome a bimonthly magazine thats still fans: New Yorks Wind-Up and
graph, and you can tackle more eso- (monochrome-watches.com). Its worth the subscription. Londons SalonQP. Have a nice trip.

FTE ACCOMPLI A GOOD-LOOKS GUIDE TO RECENT EVENTS

THE SUPERMODEL BLUES

AT THE HEIGHT of the New York Fashion neck and a pair of her mid-rise Re/Done/
Week bustle, a strategically denim-clad Levis Crawford jeans. A high waist looks so
group congregated at Indochine, ready to good on my daughter, but I put them on and
frolic. The New York City restaurant, with Im like nah, said Ms. Crawford, 51. It was
its iconic banana-leaf-patterned walls, con- her daughter, model Kaia Gerber, 16, who in-
tinues to hold sway among fashion design- troduced her to the Re/Done brand.
ers and their chums. The occasion? A Clearly, good jeansand genesrun in
launch of a collection by Sean Barron and the family: Both Kaia and her older
Jamie Mazur, co-founders of jeans label brother, Presley, 18, hit it big on the Spring
Re/Done, and model Cindy Crawford. 2018 runways with gigs at Alexander
Though the event was billed as an inti- Wang, Coach and Marc Jacobs (Kaia) and
mate dinner, the place was jammed. Ive Ralph Lauren (Presley). Despite the hectic
seen her, but I havent actually seen her, pace, the Gerber pack, along with patriarch
said entrepreneur Deena Aljuhani Abdu- Rande Gerber, all showed up at Indochine.
laziz of Ms. Crawford, quickly scanning the We stay together, said Ms. Crawford.
room, as servers circulated morsels of That is, until she and Kaia head off to Eu-
spicy chicken and fluke carpaccio. rope together (in denim, no doubt) for the
The supermodel had just started to circu- next round of shows and events.
late, glittering in a bejeweled black turtle- Lauren Ingram

Sean
Barron
Jamie
Mazur

TABLE HOP
The scene inside
Indochine.

Kaia Harley QUATRE

Gerber Cindy Viera-Newton
Jessica Crawford
Joffe

FIRST JEWELLER OF THE PLACE VENDME

In 1893, Frdric Boucheron is the rst of the great contemporary jewellers to open a Boutique on the Place Vendme

Michele
Ouellet

Jessica
Hart
Marina
Testino

BILLY FARRELL AGENCY

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
W4 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

OFF DUTY

The Insiders Cider

Invigorating, earthy, dry and highly drinkable, Spanish ciders express a wild side we forgot the apple had

BY WILLIAM BOSTWICK

A
PPLES ABOUND at
this time of year, as
falls signature fruit
spills from grocery bins
around the country. But
a crop so common still holds mys-
teries. Spanish cider, or sidra, re-
veals surprising facets of the apple
(and occasionally the pear, too).
An ancient style thats landed
stateside relatively recently, sidra is
even winning over drinkers who
had all but given up on cider. Until
recently, Max Toste, owner of Deep
Ellum bar in Allston, Mass., found 4
all the ciders he tasted too sweet,
too one-note. Just apple juice, in
his words. And for the most part,
he was right: The majority of mod-
ern American cider is made not 6
with old-fashioned cider apples
tannic, complex, powerfully sour
fruit full of the acids that give good 2

F. MARTIN RAMIN/ THE WALL STREET JOURNAL

cider its sweet-sharp balancebut
with the lunchbox-friendly sugar
bombs most domestic orchard acre-
age is given over to these days.
Then, 10 years ago, Mr. Toste had 1
a fateful sip. A friend had a find he 7
5
wanted Mr. Tostealways a fan of
3
odd, old beveragesto try. The
corked, green-glass bottle with an
indecipherable label held no clues.
The liquid inside, poured into a del-
icate, thimble-size cup, was cloudy
and nearly flat. And yet that cool PICK OF THE BUNCH // OUTSTANDING SPANISH CIDERS TO SIP THIS FALL
dram gave off fireworks of flavor:
tangy, earthy, spicy, bone-dry. I 1 Trabanco Cosecha Pro- tled using Frances traditional piles of autumn leaves. A sparkling pear cider baked pie. Less sharp than
couldnt believe how complex it pia (6% ABV) A great en- mthode Champenoise, this made from tannic cider- most, this one's nice served
was, Mr. Toste recalled. try-level cider, sour and sim- bright and bubbling geyser of 4 Sidra Natural Riestra specific cultivars. Low in at room temperature, to let
He had found sidra, and he went ple like Granny Smiths and sharp funk is a perfect pair- (6% ABV) Made from equal sugar but blossoming with its fuller-bodied sweetness
on to make an enthusiastic study grapefruits. Soft enough to ing with oysters. quantities tannic Normandy fruity, floral notesan or- shine.
of this category. Spain grows hun- drink alone but with a cut- apples and sour Spanish chard in late-season bloom.
dreds of apple varietiessome ting edge that complements 3 Isastegi Sagardo Natu- ones, this cider is still, dry Delicious with cheese or 7 Bordatto Basa Jaun (7%
200 in Asturias, a region not quite mellow, lighter autumn fare rala (6% ABV) Funky and and cloudy with a smoothly fruit desserts. ABV) A variety show of 19
the size of Connecticut on the Bay like fabada, an Asturian fresh, a Basque Country lactic, buttermilk bite. Great different apples, blended and
of Biscay from which most Spanish bean stew. splash of salty ocean spray, with fried seafood. 6 Viuda de Angeln 1947 bottle-aged. Slightly sweet
cider hails. These are craggly ap- racing and prickly. The fruit Sidra de Nueva Expresin with a rough, mineral finish:
ples you cant eat raw, Mr. Toste 2 Guzmn Riestra Sidra comes through woody and 5 Viuda de Angeln (6% ABV) Slightly sparkling, green apple rock candy, em-
said. Varieties range from pucker- Brut Nature (8% ABV) Bot- mustyfallen apples in Sidra de Pera (5.2% ABV) spicy and warm as fresh- phasis on the rock.
ing Raxao to sharply bitter Re-
gona, and frequently a single sidra
will feature several. chards where the apples grow. Its harvest feasts of hearty farm-coun- nuanced picture of Spanish food, varieties or stamps indicating pro-
not about intervening or interfer- try fare. The north of Spain is sim- beyond the tired tapas and paellas tected designation of origin. But
ing, but curating what nature does, ilar to the northeast U.S. in its that have often stood in for Iberian you can generalize: Basque ciders
said James Asbel, founder of U.S. weather and its food, said Jonah cuisine in this country. A combina- have a reputation of being more
In winter you might importer Ciders of Spain. Miller, chef at Huertas, a restaurant tion of new Spanish cooking and vinegary, more acetic, more tannic,
want something heavier, Though made simply, cider is in Manhattan heavily focused on customers willing to explore the said Mr. Toste. Theyre made in a
served with flourish in Spain, the cooking (and accompanying more adventurous flavors of funk coastal area with more salt in the
like a red wine, but poured from a wall-mounted barrel drinks) of northern Spain. In As- and sour have set the stage for air, and closer to France, so they
in fall cider is light or bottle held high, sending a long turias, rich stews and braises. In the sidra to gain ground here. use French apples, which are more
arc of liquid into a small glass Basque Country, big T-bone steaks. Still, sidra can, as yet, be hard tannic. Asturian cider skews earth-
and refreshing. called a culn. The real point of this For all of which cider makes an to find outside of restaurants al- ier and funkier.
trick, called escanciar, or throwing, ideal match. In winter you might ready hip to its charms. And when But each cider producer is as
is aeration. The atmosphere at want something heavier, like a red you do come upon a few sidras at unique as its trees and the mi-
And whereas American and Brit- Spanish cider houses is raucous wine, but in fall cider is light and your local bottle shop, how to crobes flourishing among them.
ish cider makers favor clean- and sawdust-covered floors sodden with refreshing but tart enough to cut choose the best? Mr. Toste has his Blameor thankthat untamed
crisp-fermenting lab-grown yeasts, cast-off dregs, rafters echoing folk the fat, Mr. Miller added. own rule of thumb: The less Eng- fermentation. Nature commands
sidra ferments au natural, slowly songsand above the din, the cere- Fitting, then, that the best places lish on the label, the better. Look the process of making sidra.
and with relatively little resulting monial, thunderous txotx, or tap- to find these ciders in America are for all those crazy Basque words, Theyre all exciting, but the only
carbonation, thanks to wild yeasts ping of the cider barrels. a new generation of restaurants like lots of Ts and Xs. way to truly know whats in each
and souring bacteria in the or- In autumn, cider is served with Huertas that aim to reveal a more Forget helpful listings of apple bottle is to taste for yourself.

SLOW FOOD FAST SATISFYING AND SEASONAL FOOD IN ABOUT 30 MINUTES

Steamed Clams With Basil-Cilantro Pesto

CLAMS GIVE so much and ask so little. cooked clams with diced tomatoes, fennel
KATE SEARS FOR THE WALL STREET JOURNAL, FOOD STYLING BY JAMIE KIMM, PROP STYLING BY NIDIA CUEVA; ILLUSTRATION BY MICHAEL HOEWELER

Just dont overcook them. Thats about all and white wine. Its summery and light,
you need to know to enjoy these bivalves she saidjust the thing for this in-be-
at their plump and briny best. tween season when the days are still
At Henrietta Red in Nashville, chef Ju- warm but the nights are longer and a bit
lia Sullivan has made shellfish a specialty. chillier. For a little added heat, toss in a
Our clams are shipped in twice a week couple of minced Fresno chiles.
from a great producer out in Washington A swirl of basil-cilantro pesto stirred in
State, she said. She does right by them before serving makes a delicious sauce of
with a fast steam over high heat, preserv- the clams fragrant cooking broth, with a
The Chef ing the clams tenderness and catching herbal edge and a bit of heft. Be sure to
Julia Sullivan their flavorful brine in a simple pan sauce. serve some crusty bread on the side to
In this version, her third Slow Food sop up every drop.
Her Restaurant Fast recipe, Ms. Sullivan combines quick- Kitty Greenwald
Henrietta Red in
Nashville, Tenn. TOTAL TIME: 15 minutes SERVES: 4

What Shes 3 cloves garlic, minced 1 medium yellow onion, 48 Manila clams or
Known For 3 cups basil leaves minced littleneck clams,
Cooking thats at 1 cups cilantro leaves 1 large fennel bulb, finely cleaned and purged of
once modern and cup olive oil minced grit
cozy. A way with Sea salt and freshly 2 Fresno chiles, seeded 1 large tomato, diced
shellfish, from raw ground black pepper and minced (optional) 4 slices toasted country
to roasted. Fresh, lemon cup white wine bread
bright dishes
suffused with the 1. In a blender or food processor, pulse half shells begin to open, about 3 minutes. Add
flavor of wood fire. the garlic with basil and cilantro. With motor tomatoes and continue cooking, covered, until
running, drizzle in half the oil and season clams open completely and meat is plump,
with salt and lemon juice to taste. Set pesto about 4 minutes more. Remove pan from
aside. heat and discard any clams that haven't
2. Set a lidded heavy pot over medium heat. opened.
Swirl in remaining olive oil. Once oil is hot, 4. With a slotted spoon or tongs, divide
add onions and fennel, and sweat until soft clams among four bowls, leaving broth in
but not yet taking on color, about 5 minutes. pan. Stir half the pesto into broth, taste and
Add remaining garlic and chiles, if using. adjust seasoning with salt and lemon juice.
Cook until aromatic, about 2 minutes. 5. Ladle broth and vegetables over clams and
3. Add wine, increase heat to high and bring drizzle remaining pesto over top. Serve with HOT TAKE Steamed over high heat just until they open, the clams in this
to a boil. Stir in clams, cover and cook until bread and an empty bowl for shells. recipe remain plump as they release their flavorful brine into the cooking broth.
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. Friday - Sunday, September 22 - 24, 2017 | W5

OFF DUTY

Winking at a Vanished World

The artistic eccentrics of 19th-century Paris wouldnt recognize most of their old haunts, but a few colorful spots carouse on
he told me as we wandered the halls
BY TARA ISABELLA BURTON
of the museum, citing an old French
proverb about the sudden quality of

M
USE DE LA Vie fate. But as the courtesan La Belle
Romantique, de- Otero said, it does not come by sleep-
signed to honor ing alone. Women like La Belle Ot-
the scandalous ero, in other words, slept their way
bohemians of to the top. He led me upstairs to the
early-19th-century Paris, sits, fit- private collection, accessible only via
tingly enough, just outside Mont- a twice-daily tour. On tendriled, or-
martre, home to the no-less scan- nate pewter and porcelain vases, he
dalous bohemians of that centurys highlighted the female silhouettes
close. Walking along Boulevard de and forms so common to Art Nou-
Clichy toward la Buttethe hill of veau. Women, women everywhere,
MontmartreI passed neon signs, said Mr. Hlne. It becomes obses-
sex shops and peep shows adver- sional. There were dresses, ward-
tised in flashing lights, and the robes, a hand-carved bed. You see
faded schoolhouse red of the the asymmetry? he said, pointing
Moulin Rouge. But in the hushed out an imperfection in one intricately
palatial entrance hall of the mu- carved cabinet. We call it djant. It
seum, everything was still. Inside, means a little something off. Every-
reverential portraits of the female thing chic is always a little bit d-
novelist George Sandinfamous for jant. He turned to the window. It
dressing as a man, smoking cigars was another world, he murmured.
and seducing the composer Cho- But sometimes that world came

ALAMY
pinhung on the walls. The ground alive. One night, I met up with Mas-
floor was full of splendidly uphol- STREET CRED In Montmartre, the bohemian quarter of fin-de-sicle Paris, a few traces of its raucous past remain. similiano Mocchia di Coggiola and
stered furniture, designed to evoke his wife, Sorrel, both artists and
the 1830s buildings origins as home ter. A decade later, when I was fin- saw glimpses of scenes out of Late one night, I dropped by the proprietors of Dr. Sketchys anti-
and salon for the Dutch-born ishing a doctorate in fin de sicle Baudelaire and Toulouse-Lautrec. Muse de lErotisme (open until 2 art school, a monthly sketching
painter Ary Scheffer. The era of the French literature, I decided to re- Among the sloping brick houses a.m.): a cheeky, seven-story celebra- lesson and cabaret. I joined them at
Vie Romantique was a time of ro- turn to see if the various artistic along Rue Lepic, for example, I tion of Pariss long legacy of Madame Arthur, a Belle poque-
mantic firebrands, idealistic scrib- waves of the 19th century still ex- found an anarchic caf scene. amoureuses. An exhibition of post- style cabaret hidden on Rue des
blers and the muses they so often, uded the same power over me. Twentysomething women on caf cards (from the suggestive to the Martyrs in Pigalle. The building it-
if so briefly, loved. It was a time I At first, I was disappointed. The terraces wore mismatched fur coats explicit) and newspaper articles self, with its deep turquoise walls
had once dreamed of visiting. streets at the top of Montmartre, and stoles, cloche hats. Outside La traces the history of the areas mai- and wood-carved balustrades, has
I first fell in love with the Paris where the absinthe flowed freely, Caille, an oyster bar on Rue des Ab- sons closes, the brothels that artists been a nightclub for over a century.
of the 19th century as a young teen- and where Henri de Toulouse-Lau- besses, a couple was doing the like Toulouse-Lautrec and poets like That night, the performers were
ager, naively in thrall to the mythos trec painted cancan girls and blowsy Lindy-hop on the pavement; an el- Baudelaire used as sources for per- drag queens, burlesque performers
of the Moulin Rouge, its courtesans barmaids, are today immaculate and derly, goateed man with pirate-style sonal and artistic gratification. and androgynous artists in pancake
and poets and absinthe-induced vi- chipper. Souvenir hawkers and two- bandanna was bowing to his com- (Lautrec painted the walls of a few makeup and false lashes. The crowd
sions. Though I lived in the far penny portraitists fill the too-color- panions. In lieu of French chansons, as payment.) Equal parts comic and was varied: Massimiliano and Sorrel
more staid sixime across the Seine, ful Place du Tertre. A Starbucks nes- the street-singer crooned David shocking, the muses collections dressed in an approximation of
I bicycled alone to Montmartre in tles in the shadow of the restaurant Bowies Space Oddity. felt like winks at a vanished time. 1890s attire, girls in mohawks sat
search of any remnants of that La Crmaillre 1900, where the Art Over a caf crme at La Villa des For a more refined take on deca- at one table, a group of chic, expen-
grand, melancholy excess. Id go on Nouveau walls are as shiny as the Al- Abbesses, I took notes. A bit like dence, I headed into the 1st arron- sively dressed Parisiennes in their
pilgrimages to the grave of Oscar phonse Mucha posters on sale at the Baudelaire, who turned flnerie dissement: to Maxims, the near-per- 50s huddled around another.
Wilde (buried at Pr Lachaise cem- stalls along the Seine. At 13, I was wandering and people-watching fectly preserved Art Nouveau caf But when a pianist in eyeliner, top
etery in the Belleville neighbor- easily impressed. Now, la Butte felt into an art form, I found myself beloved of courtesans and their well- hat and feather boa struck up the
hood), with armfuls of lilies, the less like a decadent carnival than lost in the immense joy [of set- heeled admirers since the late 19th chanson Madame Arthur, about a
flowers Wilde associated most with like a manicured amusement park. ting] up house in the heart of the century. The curator of the cafes ex- woman whose source of funds and
his cult of beauty. Id stand outside But down the hill from Place du multitude, amid the ebb and flow pansive fin-de-sicle art collections, furs was chalked up to her je ne sais
Montmartre cabarets like Au Lapin Tertre, on the back streets of Mont- of movement. The years had Pierre-Andr Hlne, introduced quoi, everybody chimed in. It was bi-
Agile and dream of being sophisti- martre and the increasingly gentri- passed; the energy of the streets himself with wry formality. They zarre, raucous, a little djant. It was
cated, or at least old, enough to en- fied nightlife district of Pigalle, I remained the same. say fortune comes while sleeping, exactly the city I had dreamed of.

Special Advertising Feature

CHECK IN FOR A LITTLE URBAN BLISS

B
ardia Torabi, General Manager of Roomers
Munich Autograph Collection, a newly opened
five-star property, is pondering the meaning
of luxury. Its an important question for a hotel
aiming to redefine the guest experience in a
culturally rich and elegant city where travellers can already
choose from an impressive list of upscale hotels.

For me, luxury today has nothing to do with champagne,

caviar and gold columns, he says. Were trying to interpret
luxury at a different level, and that is something that differs
from guest to guest.

Roomers is located in Munichs Westend Quarter, a

reinvigorated neighbourhood with a diversity of restaurants,
bars, cafs and shops old and new, within easy walking
distance of Munichs main rail station. The famous
Olympiaparka sports venue built for the 1972 summer
games and now an urban park used for many of the
Bavarian capitals big social eventsis nearby too.

Inside the hotel, 281 spacious guest rooms range in size

from 25 square metres to 155 square metres, and each of
the suites has a private sauna and a Jacuzzi on its terrace.
When it comes to interior aesthetics, Mr. Torabi says, Weve
worked with one of the best designers in the worldand thats
The hotels spacious guest rooms and suites range in size from 25 square
Nature. Youll see a lot of wood, marble and leather here. metres to 155 square metres.
These natural materials are enhanced by original artworks
throughout the hotel, and a rich colour palette.

Roomers stylish approach also extends to its dining

experience: Izakaya is a Japanese-inspired restaurant concept
from Amsterdam, says Mr. Torabi, citing the chicken katsu as
his favourite dish on the menu, but adding, Im a fan of the
burger with truffle mayonnaise too.

Were trying to
interpret luxury at
a different level. Roomers Spa continues the propertys opulent theme. Natural materials are enhanced by a rich colour palette.

After dinner, guests can retire to Roomers Bar where craft totally different, Mr. Torabi explains. The Roomers Spa by This is the first big five-star luxury design hotel to enter the
cocktails and a selection of shochu (a Japanese distilled liquor) Shan Rahimkhan continues the hotels opulent theme, which Munich market, Mr. Torabi concludes. Our motto is we love
are served. However, entry to its Hidden Room is by invitation will appeal to weekenders in town to enjoy Munichs rich art, life and we have the passion to share it. When you enter
only. Those lucky enough to be summoned walk through a opera and theatre scene, or early autumns Oktoberfest, as Roomers, we want you to be on a cloud.
tunnel to a second door, which opens to reveal a chic red den well as to business travellers seeking a stylish setting in which
where a sultry chanteuse sings torch songs, or Munichs hottest to unwind after a busy day of meetings.
DJ plays live. It stays open till 4 a.m.
Beyond the treatment rooms, the spa has a large pool in
Naturally, this property has a spa. During my previous which guests can float while watching movies on a full-size
experience of opening hotels, the spa was always nice but cinema screen in front of it. Just add a martini from the bar
nothing special, so this time we wanted to do something for total bliss.

The Wall Street Journal news organization was not involved in the creation of this content.
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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W6 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

OFF DUTY

PILGRIMAGE
BIBLIO TECH

How I Warmed The iconoclastic

library by
U.S. architect
Louis I. Kahn

To Concrete
A graduate of Phillips Exeter Academy returns to
its celebrated but imposing libraryand gets it

BY SARA BLISS

T
HE FIRST TIME I saw
the library at Phillips
Exeter Academy, I
didnt understand the
fuss. For five hours in
the car, my interior-designer
mother raved about this triumph
by mid-20th-century architect
Louis I. Kahn. Arriving at the
schools admissions office for my
interview, however, I distinctly re-
member my 14-year-old self glanc-
ing at the library and thinking that
nothing about the 1971 building
said masterpiece.
The brick nine-story cubeits Spindle chairs add a touch of history.
corners chamfered and its windows
and doorways forming a gridstood lamp light. His square atrium re-
bulky and boxy alongside the New mains nearly empty, and the outer
Hampshire prep schools neo-Geor- rings of each floor offer sun-
gian dorms. Later, we passed drenched sanctuaries that I found
through one of its unassuming glass after some exploring.
and aluminum doors and entered a Four cozy red armchairs on the
narrow vestibule dominated by a main floor, each framed by an over-
travertine double staircase. The size rectangular window, and an
steps solid balustrades blocked our empty carrel with views of the tree-
view until we reached the topand tops became my go-to spots. All
then the heavens opened and the ar- flood with light during the day.
chitecture angels sang. Isnt it in- William Whittaker, University of
credible? my mother asked. It was Pennsylvania Curator of the Archi-
tectural Archives, is not surprised

IWAN BAAN (INTERIORS)

impossible not to be awe-struck.
the library revealed its charms to
me slowly. Its not just a building,
it is a work of art, and works of art
Kahns library asks take time, he said. Kahns library
something of you in asks something of you in terms of
engagement and connection.
terms of engagement. I recently returned to the library, KAHN ARTISTRY // THE STYLE OF THE MODERNISTS MASTERPIECE BROUGHT HOME
after two decades. The moment at
the top of the stairs still took my
breath away. This time, however, I
The atrium soars 67 feet, capped
kicked myself for not spending ev-
by massive concrete X beams filter-
ery minute I could studying there.
ing light from windows just above.
Almost 50 years old, the building
Its concrete walls boast huge circu-
remains contemporary; its massive Matter
lar cutouts, across which run four
cutouts and materials cutting-edge. Lamp, $319,
open stories housing the book
Concrete paired with teak provides schoolhouse.
stacks, their in-facing walls clad in
instant tension and excitement in com
teak. When you arrive at that cen- 
the space, said Mr. Hall. 
tral void you are delivered into an Concrete Tape Dispenser
Today, the formerly industrial
architecture that has a lot more Small, $25, areaware.com
material still conveys modernity.
presence and grandeur than the
Retailers like West Elm and CB2 
Georgian buildings outside, ex- hawk concrete tables, stools, plant- Piet Boon CON-03
plained William Hall, author of ers. It has a clean contemporary Concrete Wallpaper,
Concrete (Phaidon), a book on look that brings a lot of dimension $299 per roll, nlxl.com
contemporary buildings constructed to a space, explained Olivia Rassow
of the material. of AllModern, a retail site devoted 
Still, during my first two years at to contemporary furniture. BassamFellows
Exeter, I almost never used the li- Architect and designer Craig Bas- Spindle Chair,
brary. It was echoey and often cold. sam, inspired by a 2011 trip to Ex- from $1,630,
The built-in oak carrels and their eter library, created his own take on dwr.com
spindle chairs, positioned near win- the spindle chair for BassamFel-
dows, were assigned to day students lows. Kahn didnt choose chairs
so they had a home base on campus. that would have identified the
Boarders versions were set away building as a 1970s structure, he Lipscomb Coffee Table, $725,
from the windows. I studied in the said. He chose an archetype that is allmodern.com
snugness of my room. super minimal and structurally 
Senior year, I realized my lagging sound. Kind of a radical choice.
grades required me to sequester Kahns obsession with natural
myself from the pull of friends light stayed with me after my re-
across the hall and MTV dance par- visit. At home, I usually huddle at
ties in the common room. The utter my desk in a corner of the apart-
quiet of the library served. ment. Today, I moved to the dining 
Kahn dispensed with the classic table, which sun hits all day. Every-  Cubic Geometry
library layout: a central reading thing seems clearer, crisper, even Mid-Century Wall Desk, SIX-11, $400,
room with rows of desks and sallow happier bathed in light. $1,600, westelm.com davidumemoto.com

FRESH PICK

A TWIST OF PLATE
The famed Delft pottery pattern is reimagined
as dishy fabrics and wall-coverings

WE ALL KNOW the iconic Delft pattern: the blue-and-

 white windmills, peacocks, florals that hail from Holland
Clockwise from and are as deeply Dutch as Vermeer. But until recently, it
top: Royal Delft lived chiefly on pottery. For the first time in the 400-year
Blue Fabric history of Royal Delft, the last remaining factory of 33 in
in Eternity, the earthenwares namesake city, the pattern is migrating
Inspiration deftly to furniture and walls. This fall, Scalamandr intro-
and Icons duces the Nicolette Mayer-Royal Delft Collection of 17
Patterns, $284 wallpaper designs and 10 textiles.
per yard, Ms. Mayer, a Palm Springs, Fla.-based textile designer,
starkcarpet.com collaborated with the legendary delftware factory, com-
bining motifs from pottery introduced in the late-1700s
F. MARTIN RAMIN/THE WALL STREET JOURNAL

with more modern touches. She also brought a welcome

breath of modernity to the wallpaper by using grass
cloth and nonwoven papers that might have disoriented
Vermeer. Interior designer Mark Sikes suggests using the
same pattern of wallpaper and fabric to envelop, drape,
even upholster a single room: It creates a single point
of view and its also so easy. The delicate floral prints
lend themselves to a bedroom while the tableware-heavy 
motifs better suit a kitchen or dining room, creating the Royal Delft Collections Blue Wallpaper,
illusion that different platesand rather precious ones $184 per yard, starkcarpet.com
at thathang on the wall. Eleanore Park
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. Friday - Sunday, September 22 - 24, 2017 | W7

OFF DUTY
THE MEDIATOR

In Search of Finer Dining

The Challenge To bridge the stylistic conflict in a couples dining room between a hulking iron sideboard and
a refined, Midcentury Modern-inflected table set. Designers suggest pieces that will help the two get along

From left: Charlotte Chairs, from $1,700,

and Cassidy Table, from $9,400, both No
Duchaufour-Lawrence by Bernhardt,
bernhardtdesign.com. Industrial Tool Chest
Small Sideboard, $1,095, rh.com

STEPHEN KENT JOHNSON FOR THE WALL STREET JOURNAL, FLORAL STYLING BY LINDSEY TAYLOR (ARRANGEMENT); AMEDEO MODIGLIANI, LUNIA CZECHOWSKA, 1919. MUSEU DE ARTE DE SO PAULO. PHOTOGRAPH BY JOO MUSA (INSPIRATION); F. MARTIN RAMIN/THE WALL STREET JOURNAL (WASTEBASKETS); ERIN GIBSON (SKLAR)

Solution 1 Solution 2 Solution 3

Introduce metal and wood shelves, then fill Add a lamp thats both organic and geometric. Borrow scale from the chest and color from the
them with a unifying color. New York architect and I love how the rounded body speaks to the table and seats upholstery. New York designer Caleb Anderson
interior designer Charles Nafie recommends Altai shelv- chairs and the square shade relates to the panels in the recommends this nearly 3-foot-square gicle print. Sizable,
ing, from Skram Furniture. Ebonized ash wood shelves chest, said Los Angeles designer Amy Sklar of the dramatic and squared-off, it echoes the buffets weighty
and metal supports combine the materials of the elegant French midcentury light fixture she suggested. The ce- presence but also nods to the table and chairs in its palette
walnut dining set and right-angled iron sideboard. And ramics random, naturalistic pattern and texture balances and 1950s-style abstraction. Mr. Anderson said many
the units grid, so light and airy, combines geometry and the industrial character of the sideboard, which is mod- home-goods retailers now include art in their offerings, in-
grace. Then you bring some life and color with accesso- eled on a turn-of-the-20th-century French toolbox. And, cluding affordable high-quality prints that give a sense of
ries in the unit, he said, possibly tying in with the color of course, the lamps color brings in the yellow of the brush strokes. It gives people the opportunity to have art-
of the upholstery youve chosen for the seats. Altai dining chairs upholstery. Monumental Vintage Yellow work of size in their home, he said. Sun Kissed Abstracts,
Shelving, $8,375, skramfurniture.com Ceramic Lamp, $975, chairish.com from $850, wshome.com

FLOWER SCHOOL FAST FIVE

THROWAWAY REMARKABLE
We searched for wastepaper baskets that arent covered with twee florals
or decoupaged spaniels. Below, the results

Swing Bin, about $70, Quartz Modern Recycling Bin,

store.moheim.com $48, rebinus.com

THE INSPIRATION

Willow and fading

Limelight hydrangea
capture the sadness of
painter Amedeo
Modiglianis portrait,
Lunia Czechowska (1919)

Vessel: Nancy Bauch of

White Forest Pottery,
designers own THE ARRANGEMENT

A FALL BOUQUET LA MODIGLIANI

Floral designer Lindsey Taylor riffs on a melancholy portrait by the Italian artist

THE MOURNFUL MOOD of Czechowska. willow had the right sage

artist Amedeo Modiglianis I started with an almost color and busyness of the
work seemed apt for a season black vase Ive long owned, as brushy background. Fading
marked by decay and the bar- attenuated and somber as Hydrangea paniculata Lime-
ing of trees. So, for my Sep- Lunia herself. Sometimes lightwhite, cream and
tember arrangement, I was when the vessel looks so pinkechoed the subjects
understandably drawn to much like the art work, its face, and the buttery green of
Modigliani Unmasked, an tricky to avoid making the a zinnia stood in for the high- Sophia Black Wire Wastecan, Hollywood Wastebasket, $98, Painted Lady Waste Bin,
exhibit running until Feb. 4 at floral portion look redundant. lights in her skin. An annual, $50, cb2.com jonathanadler.com $275, nickeykehoe.com
the Jewish Museum of New So I kept the flowers, all from Ammi Dara, added a cascade
York, particularly this affect- my yard, simple. of plums and pinks, its droop Market Edit by Cara Gibbs
ing 1919 oil portrait, Lunia Leafy salix purpurea Nana aping Lunias forlornness.
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
W8 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

OFF DUTY
RUMBLE SEAT DAN NEIL

Frankfurt 2017: China, EVs, and Dieselgate

TWO WEEKS ago (Sept. 11), the
night before the IAA Frankfurt In-
ternational Motor Show opened to
the press, I strolled through the
doors of Daimler Mercedes-Benz
vast, lighter-than-air pavilion think-
ing I knew the story. I even had a
headline: Daimler AGs Stuck Throt-
tle.
The oldest and biggest of the
German automaking giants, Daim-
lers recent financials have rocked.
Group revenue was up 3% (153.3 bil-
lion Euro) in 2016, with record prof-
its (8.8 billion). Mercedes-Benz Cars
in particular has come roaring back
to retake the title of worlds num-
ber-one premium luxury brand.
Sales were up 9% in Q2 2017 alone.
Product design is killing it.
Even the Formula One team is
winning. Lounging on stage, an Am-
azonian creature in a windswept
carbon-fiber negligee: the Mer-
cedes-AMG Project ONE, a street-le-
gal hypercar built around the
+1,000-hp hybrid powertrain of a
Formula One car. Each of 275 copies
costs $2.7 million Euros. The engine BIG BENZ Mercedes-AMG unveiled
revs to over 11 grand. That should the $2.7 million Project ONE the
be lively. night before the IAA Frankfurt
But Daimlers solemn commit- International Motor Show.
ment to eternally high returns, what
it calls a sustainable 10% net
profit to shareholders, means it with costly penalties behind them, goals. Mr. Zetsche said. That is why ern Europe the carmakers depend
cant let off the throttle, ever. And that have left the German automak- Now sooner than later, Chinas Daimler has invested 3 billion Euros on the profits from large luxury ve-
its heading for a wall. A Great Wall. ers crying for mercy. With German mandates will push the market price in the further development of our hicles, many with diesel engines,
In China. Chancellor Angela Merkels help, of batteries below the $100/kWh diesel engines. which produce less carbon per kilo-
See? I even had catchy phrases at they got the start date pushed back threshold at whichthereabouts, all With respect, that is a bit post- meter than gasoline equivalents.
the ready. to 2019. things equalan EV design attains hoc: Its the 3 billion Euros already Without diesels carbon offset, auto-
Two days before Daimlers pep Though not unexpected, Chinas cost-parity with an internal-com- spent that makes it worthwhile, not makers have no hope of meeting the
rally, on Sept. 9, industry ministers announcement brings two things to bustion vehicle. After that, Katy bar the other way around. Even the European Unions fleet-average
in China confirmed that, like France, the EV battery industry it sorely the door. Project ONE raised an eyebrow. standards (95 grams per kilometer
the U.K., Norway and the Nether- needs: certainty of demand (albeit The other skunk at Daimlers pic- In any event, Mr. Zetsche will by 2021) or avoiding hefty pollution
lands, the worlds largest vehicle compulsory) and scale. Global bat- nic was Dieselgate. Two years after have to take it up with the people fines, Brussels bill for noncompli-
market (24.4 million in 2016) would tery production is expected to dou- clean-air investigators discovered and parliaments of Europe. In the ance.
phase out fossil-fuel vehicle sales in ble in the next five years. As down- emissions-cheating software in VW two years, diesels market share has
favor of widespread, state-spon- payment on its plan to lead the Group products, affecting more than fallen by 8%. Even in the home court
sored vehicle electrification. world in energy storage devices, 11 million vehicles world-wide, the of Germany, sales fell 14% in August
Because of climate change? Sort China will add 120 gigawatt-hours scandal and public ire has become from 2016. Madrid, Paris, and Ath- Chinas EV mandates
of, sure. But with its cities shrouded of annual battery production capac- general. In remarks from the stage, ens have announced diesel bans to represent a whole new
with deadly tailpipe smog, Chinas ity by 2021. Thats three times the Daimler AG chairman Dr. Dieter combat urban concentrations of
air-quality concerns are more re- output of Teslas Gigafactory. VW Zetsche pushed back on growing NOx and particulates, coming fully industrial super-gravity.
gional than global. The nation of Group board member for research sentiment in Europe to restrict die- into force by 2015. Even Daimlers
1.37 billion souls is also trying to and development Ulrich Eichhorn sel vehicles if not ban them alto- hometown of Stuttgart wants to
kick the imported-oil habit. China told Automotive News the company gether. Its a fact that its worth- brush the citys famous soot from The theme of Mercedes-Benz me-
has already outlined tough electrifi- will need 200 gigawatt-hours worth while to improve modern diesel its shoulders. dia gala was #settingthemood; but
cation mandates for automakers, of batteries by 2025 to meet its engines rather than to ban them, Its worse that it looks. In West- everywhere I looked I saw #sunk-
costfallacy, the human tendency to
double-down on bad bets, for fear of
losing what economists call sunk
costs. But sunk costs are not recov-
erable in any case, thus the fallacy.
Its hard knowing when to walk
away. But walk away. Diesel is politi-
cally doomed in Europe. Chinas
electrification mandates represent a
whole new industrial super-gravity.
Given these events, and rising public
sanction, Mr. Zetsche, how long can
the German car industry afford to
hang on to diesel? Long enough to
recover sunk costs? Oh dear.
Anyway, even that wasnt the big
story, the real story. Did you see
BMW Concept X7 iPerformance is a near-production-ready full-size, three-row The electric, autonomous Audi Aicon (A.I.) concept offers a preview of driverless those heels F1 driver Lewis Hamil-
SUV. Without diesel, German automakers big-car profits in Europe are at risk. luxury cars. There are no pedals or steering wheel in the cabin. ton was wearing? Gwan, mate.

THE FIXER MICHAEL HSU

Tiny Tech Hacks for When Youre In a Pinch

OVER THREE-AND-A-HALF years, discounted titles for your Kindle Tweezers That Are Worth
Ive had the privilege of trying to and other e-readers. After you reg- The Investment
solve your tech and gadget prob- ister with the site, it emails you Finally, a colleague asked if there
lems. Ill be moving on to other updates so you can track specific was any product that I love but
adventures soon. For my last col- authors or genres as relevant havent had a chance to recom-
umn, I wanted to share a few tips books go on sale. Among the cur- mend. One that came immediately
that readers of The Fixera very rent titles the site is highlighting: to mind: Rubis tweezers (rubis.ch),
inventive grouphave shared with Martha Stewarts Marthas Ameri- which make easy work of remov-
me. can Food, and Jon Meachams Pu- ing a recalcitrant tick or barely
litzer Prize-winning biography of visible splinter. Whereas using
Turning Your iPhone Into Andrew Jackson, American Lion; lesser tweezers can feel like trying
A Magnifier both are selling for $3. to grab something with slippery
After I ran a column about gadgets More than a few readers ex- mittens, Rubis are precise. Each
for reading small type, Larry Win- pressed surprise that I hadnt pair is made by hand in Switzer-
ans emailed me about a trick he mentioned Project Gutenberg, a land to exacting standardsevi-
uses to turn his iPhone or iPad volunteer-run site that offers over dent in the way the tiny tool offers
into a digital magnifier: Open the 54,000 free e-books. You can im- a firm and sure grip. Rubis twee-
Camera app, aim your device at port Project Gutenberg books to a zers are expensivearound $40
the offending tiny text, then zoom Kindle by opening the Kindles web but very durable. Ive had mine for
in on it using the pinch-out ges- browser and visiting m.guten- over a decade and they still look
ture. You can vary the zoom level berg.org. Alternatively, import ti- like new.
KIERSTEN ESSENPREIS

easily, Mr. Winans writes. The tles to your smartphones Kindle

iPhone and iPads official Magni- app. Just visit the same URL from ITS BEEN AN honor writing this
fier function, enabled by going to your smartphones web browser, column. Thank you for reading and
Settings followed by General choose a title, then tap the Kindle for sharing your frustrations and
and Accessibility, achieves the format. Youll be prompted to insights with me. In his final per-
same effect. Open in Kindle. Agree, and sonal-advice column for Salon,
whooshthe book is yours. sesses similar fix-it-all powers but pros use to wrap cables, but while Garrison Keillor wrote, It was ex-
E-Books on the Cheap comes off more cleanly and tears theirs arrives in a huge heavy roll hilarating to get the chance to be
In response to a column about A Duct Tape Alternative more neatly. Allen Green emailed (usually weighing over a pound), useful, which is always an issue
ways to score free e-books, Jim As you might expect, I cant live me about a product his company 1-inch-wide MicroGaffer is sold in for a writer. I feel the same way.
Vander Spek and others emailed to without duct tape, but Im not offers called MicroGaffer (mi- a more manageable size that My sincere thanks for the opportu-
let me know about BookBub (book- crazy about the gummy residue it crogaffer.com). Its the same gaffer weighs just 2 ounces. MicroGaffer nity to solve a small, specific prob-
bub.com), a site that alerts you to sometimes leaves. Gaffer tape pos- tape that photo, video and audio costs $21.50 for a four-roll pack. lem or two.
 For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.

MANSION
To reprint or license content, please contact our reprints and licensing department at +1 800-843-0008 or www.djreprints.com

If you dont find it in the index,

look very carefully through the
entire catalogue.
Sears, Roebuck and Co. 1897 catalog

HOMES | MARKETS | PEOPLE | UPKEEP | VALUES | NEIGHBORHOODS | REDOS | SALES | FIXTURES | BROKERS

2017 Dow Jones & Company. All Rights Reserved. THE WALL STREET JOURNAL. Friday - Sunday, September 22 - 24, 2017 | W9

Kit Homes: An Appreciation

Sold from the pages of a catalog, these houses had high-quality materials and were
shipped to faraway places. Those that remain today can sell for over $1 million.
ELI MEIR KAPLAN FOR THE WALL STREET JOURNAL (3); SEARS ARCHIVE (HISTORICAL)

IN THE CATALOG Michael and Megan Spratt bought a 1925 Colonial-style home in Washington, D.C.,
above, for $1.06 million last year. The homes original owners picked this design, the Martha Washing-
ton, from the pages of a Sears, Roebuck and Co. catalog, right. Top right, the Spratts with their chil-
dren, Trevor and Genevieve; below, the living room.

BY NANCY KEATES

A 1925 COLONIAL-STYLE HOME in Washington, D.C.,

that sold last year for $1.06 million had humble begin-
nings. It was a Sears, Roebuck and Co. kit home, the
Martha Washington, advertised in the companys ubiq-
uitous catalog for $3,727 in the 1920s.
It was something that made it unique, says Mi-
chael Spratt, an attorney who bought the house with
his wife, Megan. It was really solidly built.
From 1908 to the 1940s, Sears, Roebuck sold an esti-
mated 70,000 kit homes in about 370 different styles,
from Colonials to bungalows. In the 1920s, prices
Please turn to page W14

HOUSE
IN LONDON, BUYERS LIKE IKE OF THE DAY
wsj.com/houseoftheday
The World War II headquarters of Dwight D. Eisenhower on Grosvenor Square are being transformed into
luxury residences, with some priced above $65 million; more than half have already been sold.
RISE MEDIA/THE CORCORAN GROUP

BY RUTH BLOOMFIELD

DURING WORLD WAR II,

Gen. Dwight D. Eisenhower
masterminded the victory of
the Allied forces from an of- Brooklyn, N.Y.
fice on Londons Grosvenor An actors home
Square. in a onetime stable
The view of the tree-lined
square that the future presi-
dent looked out upon has
changed little since the
1940sbut Londons prop-
erty market certainly has.
Eisenhowers former mili-
tary headquarters are now
JACOB ELLIOT

being transformed into lux-

ury residences, with some
priced above 50 million, or
about $67.7 million. Atherton, Calif.
By next summer when the
MICHAL ZINGRAF/CHRISTIES INTERNATIONAL REAL ESTATE

A Silicon Valley house

redevelopment of 20 Grosve- with old-world charm
nor Square is complete, the
large private office used by
Eisenhower as his U.K. base
in 1942 during the Allied in-
vasion of French North Af-
rica, and in the immediate
run up to the D-Day landings
FINCHATTON

of 1944, will have been re-

purposed into two first-floor
bedroom suites.
When we first bought the LONDON LUXE A rendering of the redeveloped 20 Grosvenor Square, set to be completed next summer.
building we found a giant
map of the world, with the fice, said Alex Michelin, co- The map proved too frag- buildings role as the former purposed as a table top for Aix-en-Provence
U.S. right in the middle, in founder of Finchatton, the ile to salvage, but the floor headquarters of the U.S. Na- one of the buildings commu- A family getaway
what was Eisenhowers of- projects developer. plaque commemorating the val Forces Europe will be re- Please turn to page W10 in the south of France
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
W10 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

MANSION

IN LONDON, BUYERS LIKE IKE

FINCHATTON (2); DWIGHT D. EISENHOWER PRESIDENTIAL LIBRARY & MUSEUM (HISTORICAL)

Continued from page W9 GENERAL IDEA Above and below, interiors of the residences at 20 Grosvenor
nal areas. Square, shown in renderings; right, Dwight D. Eisenhower meets with military
Other than the buildings red- aides at 20 Grosvenor Square in 1944.
brick facade, this plaque will be the
only original feature in a redevelop-
ment that has involved entirely re-
building the inside of the building.
Grosvenor Square was laid out
in the 1720s as a Georgian garden
square surrounded by townhouses.
An early resident was John Adams,
first American minister to Great
Britain, and the second president
of the U.S., who lived on the square
between 1785 and 1788. The square
is at the heart of the Mayfair
neighborhood, which was, at the
time, almost exclusively residential.
But over the centuries that fol-
lowed most of the original houses
were demolished and rebuilt (often
several times) and gradually re-
placed with offices, apartments, as and meeting rooms, and a movie dle East. Three sets of buyers have Finchatton has now owned 20 market on a series of increases in
well as the U.S. Embassy and the theater with leather armchairs and purchased two apartments each; Grosvenor Square for four years, Stamp Duty rates imposed by the
Canadian High Commission. cocktail lounge style tables. they plan to live in one and use negotiating its purchase as prime British Government. Anyone spend-
During World War II, the U.S. The interiors are a symphony of the other to house ageing relatives central Londons market was start- ing 50 million, or about $67.7 mil-
Navy took over a 1930s apartment slightly bland good taste: kitchens or student offspring. ing to recover from the recession. lion, on a second home in London
building on the square. Eisen- designed by Finchatton and built These buyers do While workmen will now incur a levy of 7,413,750,
howers arrival prompted its nick- by Bulthaup, bathrooms in a mix- have one thing in were digging out or a little over $10 million.
name, Eisenhowerplatz, in honor ture of black-and-white, book- common: extreme its basement and The biggest difference [in the
of the Supreme Commander of the matched marble, a color scheme wealth. During World War II, removing its in- market] is a lack of urgency, he
Allied Expeditionary Forces. heavily dominated by tones of gray Apartments sold nards, prices in said. People still have money, and
The Navy continued to use the and taupe, silk carpets and linen so far range in the U.S. Navy took over prime London a desire to buy in London, but these
building until 2009. In 2013 it was wallpapers. price from about a 1930s apartment were soaring as in- people are usually discretionary
sold to Finchatton and the Abu The residences officially go on $23 million to ternational buyers and there is no feeling that if I
Dhabi Investment Council for 250 sale this month, but buyers have north of $67 building on Grosvenor piled into its lux- dont buy this I am going to lose it.
million. been quietly picking up homes at million, with Square. Eisenhowers ury market. Nonetheless, apartments at 20
Permits for the 250,000-square- 20 Grosvenor Square ever since homes overlooking Over the past Grosvenor Square have continued
foot buildings conversion into 37 news of Finchattons purchase of the square com- arrival prompted the two years, how- to sell, slowly but steadily.
residences was granted in 2014, the building broke. More than half manding about squares nickname, ever, prices have A selling point is the involve-
and the first owners will move in of the residences already have $10,000 per square peaked, plateaued ment of Four Seasons Hotels and
next summer. been sold. foot. On average, Eisenhowerplatz. and fallen. Accord- Resorts, which will run the build-
The developers added two extra Charles Leigh, sales director at the development ing to Knight ings services. Residents will pay an
stories to the building, bringing it Finchatton, said buyers range in has sold at around Frank, prices annual service charge of around $16
to eight stories. They also sunk a age from their early 30s to late $4,700 per square foot dropped an average of 6.7% across to $19 per square foot, covering
three-level basement beneath the 70s, and come from all over the Currently available are three- to prime central London in the year to maintenance and access to the lei-
building, which will provide space world, with countries including In- four-bedroom apartments, starting January, with Mayfair enduring a sure facilities, and will pay on top
for a host of amenities: a pool sur- dia, Belgium, Chile and Russia rep- at about $23 million, and five-bed- fall of 4.4% of that for extras, which range
rounded by four-poster day beds, a resented; there are also buyers room apartments that are just Mr. Michelin, along with most from grocery delivery and dog
wine cellar, a games room, function from North America and the Mid- shy of about $54 million. observers, blames the stumbling walking to massage treatments.

SPREAD SHEET | ALINA DIZIK

HARVEYS EFFECT ON HIGH-END HOMES

In Houston, closings on luxury homes fell sharply after the hurricane, but listing and sales prices dipped only slightly after the storm

Hurricane
Harvey Ebb and Flow
wreaked The change in inventory and sales prices of homes listed for
havoc on over $1 million in Houston two weeks before and two weeks
Houston and after Hurricane Harvey struck.
caused bil-
lions of dol- Before Harvey After Harvey % Change
lars in prop-
Median list price $1,574,000 $1,525,000 -3.11%
erty damage. One segment of
the real-estate market, how- No. of listings 1,420 1,528 7.61%
ever, was less impacted: lux-
Median sale price $1,385,000 $1,354,000 -2.24%
ury homes.
While the number of sales No. of sales closed 103 50 -51.46%
that closed fell markedly af- Source: Houston Association of Realtors, MLS
ter the hurricane, both list-
ing prices and sales prices
fell only slightly, according Its a juggling act, says showings, Mr. Thayer, who is
LOS ANGELES TIMES/GETTY IMAGES

to Multiple Listing Service Mr. Surratt, who is with working with Mr. Surratt,
data from the Houston Asso- Greenwood King Properties. hasnt received any offers.
ciation of Realtors. Those looking to make a Its been quiet, he says.
The median list price was purchase are now more con- More buyers are thinking
down 3.1% and the median cerned about previous vertically these days, says
sales price was down 2.2%. flooding, he adds. Robert Bland of Pelican
For its analysis, the asso- Celebrity photographer Builders, developer of the
ciation looked at luxury- Evin Thayer is keeping his Wilshire, a luxury condo
home listings, defined as $1 $1.2 million contemporary building under construction
million and up, between Jan. those between Aug. 25 and Estate Center at Texas A&M Surratt says he is fielding homenot damaged in the in the River Oaks District.
1 and Aug. 24, and compared Sept. 11. University. Were expecting dozens of calls from home- floodingon the market. He Ten days after the storm, Mr.
data to listings between Aug. Only a slight price de- it to bounce right back up, owners who are considering is betting that some buyers Bland signed four contracts
25 and Sept. 11. In its analy- crease for luxury homes is he says. For the most part, listing their flood-damaged are eager to invest in a for units ranging from
sis of home sales, the associ- predicted in the coming these [homeowners] were homes. He is also hearing never-flooded home in Hous- $800,000 to $3 million. In a
ation compared sales be- months, says James Gaines, able to absorb it. from potential buyers look- ton Heights, which sits on twisted kind of way, its been
tween Aug. 7 and Aug. 24 to chief economist at the Real Real-estate agent Tim ing to buy a fixer upper. high ground. Despite regular a plus, he says.
THE WALL STREET JOURNAL. Friday - Sunday, September 22 - 24, 2017 | W11

MANSION
HOUSE CALL | MICHAEL MCDONALD

No Record Player, but a Honky-Tonk Piano

The former Doobie Brothers lead singer recalls the battered upright in his familys Missouri basement

My life changed the day my father brought

home a piano. It was a huge, ornate upright
grand, and a lot of the ivories on the keys
were missing. As my father and his friend
struggled to get it down to the basement, he
had to swat me away. I kept trying to play it.
Louis streetcar driver. When the
city pulled up the tracks and re-
placed them with buses, it broke

EMILY ASSIRAN FOR THE WALL STREET JOURNAL; KATHY WALKER (HISTORICAL)
his heart. He drove a bus but soon
worked his way up to the bus com-
panys insurance division.
My mother, Mary Jane, ran an
S&H Green Stamps redemption
store. She worked tirelessly and
didnt have much time left to raise
my sisters, Kathy and Maureen,
I was 9, and the piano went and me the way she probably
downstairs because my parents would have liked.
didnt want me banging on it up- My parents loved popular mu-
stairs in the main house. The pi- sic. My dad knew who wrote all
ano was pretty beat up, so I even- the songs, and he had great re-
tually put metal thumbtacks in all spect for songwriters. His passion
the hammers that struck the rubbed off on me.
strings. They gave the piano a When I was 7, I was walking
tinny, honky-tonk sound. through the lobby of my aunts
I was born in St. Louis but grew apartment building in St. Louis. As
up in the suburbs of Ferguson, Mo. I shuffled my feet on the marble
Our three-bedroom house on High- surface, I made up a melody. I THIS IS IT Michael McDonald, above, at the Ridgefield (Conn.) Playhouse where he performed in July, and left, on the
mont Drive was in a postwar de- thought, Yeah, I can do that, I can far left, playing in one of his first bands, Mike and the Majestics, in 1965, at the Holiday Inn, Florissant, Mo.
velopment with one bathroom, a write songs.
kitchen and a dining room. My first collaboration was with had much of a record collection. ran into Rick Jarrard, a record yon. We just moved our master
My attention span was awful. my father when I was 10. He gave After we moved, I had a Wurlitzer producer from Los Angeles. bedroom to the back. Now we have
My parents had been trying to get me a sheet of lyrics he had written keyboard that I played all the time Rick hired me for his production a view of the meadow preserve
me interested in somethingany- at work. The title was My Heart in bands. company and sent me a plane that runs to the ocean.
thing. Before long, the piano was Just Wont Let You Go. I wrote Through much of high school, I ticket and some cash, and off I For years Id run into my fa-
all that mattered. I wound up tak- the music in about 10 minutes. was in a 12-piece soul dance band went. He gave me my start. thers lyric sheet for My Heart
ing only six months of lessons and After my parents divorced when called Jay and the Sheratons. We My wife, Amy, and I divide our Just Wont Let You Go. When we
I never had a voice lesson. I had a I was 11, my mom sold the house were the house band at a club in time between Santa Barbara, Calif., renovated, I foolishly put the sheet
pretty good ear. and we moved to an apartment Ferguson and backed everyone and Nashville. I record a great deal in a book for safekeeping. Now I
I was always down there play- complex off West Florissant Ave- who came to town, including in Nashville, so when were there, cant remember which one.
ing, often in my underwear. The nue. The piano didnt make the Chuck Berry. we stay in our one-story brick As told to Marc Myers
basement was one of the few cool trip. Their split was hard on me. In August 1970, after my junior ranch on 3 acres with my studio
spots in the house. When my older My dad and I were close and I only year of high school, I dropped out off the back. Michael McDonald, 65, is a
sister, Kathy, came down with her got to see him on Saturdays. He and went on the road with Blue, Amy loves our Santa Barbara Grammy-winning singer-song-
friends, theyd see me and laugh. soon started another family. my four-piece band. We played a home. Its a one-story, three-bed- writer who was lead singer of the
Id play them their favorite songs. I know its strange, but I never lot of small college towns. At a room clapboard ranch house, and Doobie Brothers. His latest album
My father, Robert, was a St. owned a record player and never club in Champaign-Urbana, Ill., I an ocean breeze comes up the can- is Wide Open (BMG Soundstage).
 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
W12 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

MANSION

BENT REN SYNNEVG FOR THE WALL STREET JOURNAL (4); AGNETHE MOHN/BENT REN SYNNEVG FOR WSJ (2, HISTORICAL)
ON THE MARKET Helge Riisen and Janicke Hetland have added luxury details to the historic Mohr estate since buying it in 1990. The property, shown below left in 1966, is listed for about $2.1 million.

LIVING HISTORY

A Norwegian Estate Is Made Grand

Once a stop for dignitaries, a property hits the market after an extensive renovation

ground for another resident of the

BY J.S. MARCUS
houseaviator Wilhelm Mohr Jr.,
who served in the British Royal
FOR CENTURIES, the city of Ber- Air Force and later became head of
gen on Norways western coast the Royal Norwegian Air Force.
fostered a distinctive merchant Ms. Mohn calls her uncle, a dec-
class profiting from trade in com- orated soldier, a real war hero.
modities such as Norwegian cod He died in 2016 at age 99. Im the
and Russian grain. One of the last last Mohr descendant left in Ber-
and most distinguished of these gen, she adds.
merchant-princes was Conrad Two Norwegian sovereigns
Mohr (1849-1926). A key remnant King Haakon VII (1872-1957), and
of his one-time enormous hold- his son King Olaf V (1903-1991)
ingsa manor house completed in knew the manor house, says Ms.
1912has come on the market. Mohn, a 72-year-old retired
The four-level 6,500-square-foot teacher. She now has the homes
clapboard home has nine bedrooms original oak dining table, custom-
and five bathrooms, and sits on a made in eastern Norway, in her
secluded 2-acre lot in the Paradis Paradis home nearby.
neighborhood south of Bergens She recalls that her grandpar-
historic core. The residence was ents made do with chamber pots
built by his son, politician and in the upstairs bedrooms until the
farmer Wilhelm Mohr (1886-1978), 1970s. By the late 1980s, Emily
on land given to him as a wedding Mohr was living in a nursing home
present in 1908. nearby, and the houses only occu-
The home stayed in the family pant was an elderly maid.
until after the death of the youn- MOHR When Dr. Riisen and his wife
ger Mohrs wife, Emily, in 1988. It MANOR The bought the house in 1990, they
was sold again in 1990 to Helge Ri- home, left, was embarked on a decadeslong up-
isen, a Norwegian neurologist built for Emily grade. They retained some original
and crime-novel author, and his and Wilhelm pieces, including a rough-hewn,
wife, Janicke Hetland, a nurse. Mohr, below rock-crystal chandelier and a fire-
The couple paid about $204,000 left, who mar- place from the U.K. They also
for the property and spent about ried in 1908. added some luxurious elements:
$383,000 on renovations. They are The current Oriental carpets, a marble fire-
selling the estate for 16.5 million owners spent place and ornate chandeliers.
Norwegian kroner, or about $2.1 about The house is grander now than
million. $383,000 on it ever was before, says Ms.
Ms. Hetland remembers the es- renovations Mohn, a frequent visitor there in
tate from her childhood, when it and luxury de- her grandparents time.
was common for Bergen families tails, above and Dr. Riisen, now 66, and his
to take day trips to the sprawling far left. wife, 60, raised three children in
working farm and marvel at its the house. Now that the children
hundreds of animals. are grown and the doctor has re-
The Mohrs commercial pres- tired, the couple are planning to
ence in Bergen dates back to the move to a newly constructed Par-
early 19th century. Conrad Mohr adis duplex, about one-third the
was a major importer of grain to limits. Agnethe Mohn, Conrad tained strong ties to Germany. Thowsen says Conrad Mohrs rela- size of their current home. Hugo
Norway, says Bergen historian Atle Mohrs great-granddaughter, says Conrad Mohr was the German tionship with the kaiser led to Ger- Frde of DNB Eiendom is handling
Thowsen, director emeritus of the it reached a peak of nearly 173 consul in the city, and a friend of man interference on Norways be- the sale of the estate.
citys Maritime Museum. The first acres. The property, which in- the kaiser. half. Ms. Hetland herself comes from
oil tanker built for a Norwegian cluded Conrad Mohrs mansion be- That friendship proved decisive Wilhelm Mohr was allowed to a distinguished Bergen family. Her
shipping company, commissioned fore it was torn down in the 1960s, for the history of Norway, says keep the house during the Nazi oc- father was Audun Hetland, an art-
before World War I to import once welcomed foreign dignitaries Mr. Thowsen. Following Den- cupation of Norway during World ist and one of Norways leading
Standard Oil petroleum from such as Germanys Kaiser Wilhelm marks defeat in the Napoleonic War II, in part because of his fam- caricaturists.
America, was named the Conrad II. Later, the Shah of Iran was a wars in the early 19th century, ily, Ms. Mohn says. Many other Amid the decorations of the
Mohr. visitor to the manor house now for Norway passed into a subordinate large Bergen houses, explains Mr. now-elegant ground-floor rooms
By the late 19th century, Mohr sale. union with Sweden, becoming in- Thowsen, were confiscated and where heads of state once relaxed
began piecing together a vast es- The Mohr family, which had dependent in 1905 after a threat used by the Germans. are some of her fathers comic de-
tate, in what was then outside city German and Danish origins, main- of war between the countries. Mr. That war proved a testing pictions of Norwegian celebrities.

PRIVATE PROPERTIES

New York Penthouse Hits the Market for $110 Million

An enormous penthouse at pointed, green, copper-clad the building in 2014, but the
the iconic Woolworth Building peak. There is an open obser- penthouse was held back from
in Manhattan is going on the vatory with 360-degree views. the market until construction
market for an equally enor- Inside, the 9,710-square- progressed and prospective
mous asking price: $110 mil- foot apartment has ceilings up buyers could safely tour the
lion. to 24 feet and a private eleva- space, Mr. Horn said. The
If the property were to sell tor. The interior is still raw, so lower levels are still leased for
for that price, it would blow prospective buyers could cus- commercial use.
away the current record for an tomize the number of bed- Local agents said sales have
apartment downtown, which is rooms and bathrooms to their been slow at the building amid
currently held by the $50.9 preference, said Ken Horn, the a turndown in the ultraluxury
million sale of a unit at Chel- founder and president of Al- Manhattan property market,
seas Walker Tower, according chemy Properties, the com- though Mr. Horn said activity
to public records. pany converting the top floors picked up starting in the
WILLIAMS NEW YORK (RENDERING)

When it was completed in of the building to residential spring. He declined to com-

1913, the 792-foot neo-Gothic use. ment on exactly how many
skyscraper, seen in a rendering The unit is the highest units were spoken for.
here, was the worlds tallest priced of the buildings 33 resi- Stan Ponte and Joshua
building. The apartment, which dences, which sit on top of the Judge of Sothebys Interna-
has been dubbed the Pinnacle, 58-story tower named for dis- tional Realty are handling sales
starts at 700 feet up and is count-store pioneer F.W. Wool- at the building.
contained within the building's worth. Sales first launched at Katherine Clarke
For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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THE WALL STREET JOURNAL. Friday - Sunday, September 22 - 24, 2017 | W13

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For personal non-commercial use only. Do not edit or alter. Reproductions not permitted.
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W14 | Friday - Sunday, September 22 - 24, 2017 THE WALL STREET JOURNAL.

MANSION

CATALOG KIT HOMES: AN APPRECIATION

Continued from page W9
ranged from about $600 to $6,000,
which is roughly $8,400 to
$84,000 in todays dollars. Once
purchased, all of the partslum-
ber, windows, cabinets, nails, paint
and morewere shipped across
the country for assembly on the
customers lot.
In the first half of the 1900s,
seven national companies sold kit
homes from catalogs, but Sears,
Roebuck and Montgomery Ward
were the best known. Today, no-
body knows exactly how many of
the homes remain. But real-estate
agents say theyre seeing more
listings emphasizing a kit-home
provenance.
When real-estate agent Anna
Mackler listed a kit-home in Wash-
ington, D.C., the marketing materi-
als crowed, Own a piece of his-
tory! In May, the home sold for
about $636,000which was
$200,000 over the asking price.
The kit-home angle made it more

CHRIS SMITH FOR THE WALL STREET JOURNAL (3); SEARS ARCHIVE (HISTORICAL)
appealing by adding to its charac-
ter, Ms. Mackler says.
Catarina Bannier, an agent with
Evers & Co. Real Estate in Washing-
ton, says she has been getting more
emails from real-estate agents,
owners and buyers who want to
know if a house is from a catalog
and if it increases a homes value.
That depends on its location, she
says. In April, she sold a stately
1920s, five-bedroom brick kit home
made by a company called Lewis TIME CAPSULE In Indianapolis,
Manufacturing for $2.75 million. Scott and Amy Wise listed their home
The buyers, Richard and Jill for $725,000. Left, their home, the
Lane, say that after purchasing the Hammond, as depicted in a Sears,
house they, became more inter- Roebuck catalog. Above, a plaque on
ested in the history, discovering it the home; right, the couple with their
was one of only four authenticated kids, Lincoln, Slater, Vaughn and Ivy.
Standish models still standing. The
exterior, says Mr. Lane, a 54-year-
old principal in a commercial real-
estate firm, has classic style and

STEPHEN VOSS FOR THE WALL STREET JOURNAL; LEWIS MANUFACTURING (HISTORICAL)
curb appeal.
Some homeowners have com-
pletely overhauled their kit homes.
In the capitals Chevy Chase neigh-
borhood, Michael and Caity Callison
have a Liberty kit home also made
by Lewis Manufacturing that they
purchased about 30 years ago. Mr.
Callison, a 63-year-old architect, did
a $300,000 renovation in 2005,
adding about 900 square feet. He
created a master bedroom on the
lower level so it wouldnt affect the
homes original roofline. I didnt
want to change the character of the
house, he says.
Kit homes appealed to buyers at
the time because they were afford-
able, included quality materials PICTURE PERFECT Richard and Jill Lane paid $2.75 million earlier this year
and could be shipped to faraway for a 1920s kit home in Washington, D.C., made by Lewis Manufacturing. At
places. right, a rendering of their home, the Standish, in an advertisement.
In Indianapolis, Russ Lawrence,
a real-estate agent with F.C.
Tucker Co., listed a renovated,
6,000-square-foot, 1930s Sears,
Roebuck house in April that is lo-
cated in a neighborhood where
most of the older homes have been
torn down and replaced with big
STEPHEN VOSS FOR THE WALL STREET JOURNAL (2); LEWIS MANUFACTURING (HISTORICAL)

new houses. Its history has been a

selling point, Mr. Lawrence says.
Every single person who sees it
mentions the Sears history. Theres
a curiosity factor, he says.
The current owners, Scott Wise,
44, who founded a chain of brew-
house restaurants, and his wife,
Amy, 43, say the previous owner
kept the character of the kit house
but added on a new master bed-
room and addition in the back of
the house. This is a perfect amal-
gamation, says Mr. Wise. Their
four children dont grasp the sig-
nificance of the home, but theyre
sad to leave it: The family has
listed the home for $725,000 to
move to a house with more space.
Most people knew about kit
houses in their heyday because ev-
eryone had a Sears catalog in their
house, says Andrew Mutch, an in- TIMELESS DESIGN In Washington, D.C., Caity and Michael Callison, top left, own a kit home, above, from the Liberty
formation-technology administra- line advertised by Lewis Manufacturing, left. A $300,000 renovation added space but kept the homes original roofline.
tor who lives in a Sears kit house
in Novi, Mich. About five years ago house in Royal Oak, Mich., for Mass., on the market for $1.295 shell, but not the interior materi- custom home. The house took
Mr. Mutch, 45, started driving $269,500 in 2015, they knew it was million. She knows itll likely be als, windows, doors, plumbing or about seven months to build. Mr.
around looking for kit homes using a kit house from the real-estate torn down since the location, right electrical. Andreasen, a 70-year-old former
a field guide called Houses By listing ads, but they didnt know on Cape Cods Waquoit Bay, is Lindal Cedar Homes, based in spec-home developer who lives in
Mail, posting his findings on his what that meant. The learning more enticing than the house, Washington state, has sold about Greenwich, Conn., doesnt antici-
Kit House Hunters blog. process that ensued has changed which has no heat and sits on a 50,000 kit homes since 1945. The pate kit homes will catch on
Mr. Mutch is part of a small net- Mr. Romains life. cinder block foundation. My models start at about $100,000 and widely because people dont want
work of kit-house enthusiasts across He started by researching the neighbors are upset with me. They range in size from 700 square feet to do the work themselves any-
the country who are intent on docu- model of his home, a Sears, Roe- say I should donate it, she says. to 25,000 square feet. more.
menting the remaining kit houses. buck 1925 Vallonia, digging up the Thats not to say kit homes will What has changed, says vice For do-it-yourselfers, the sav-
Its kind of like bird watching, blueprints and photos as far back disappearthere are still compa- president of marketing Signe Ben- ings can be dramatic. Jeff Yoder,
says Judith Chabot, a French as the 1930s, and examining how nies that make them today. As son, is that the younger clients now 34, an information-technology sup-
teacher in St. Louis who moderates the house had changed over the housing prices have gone up and want modern instead of traditional port specialist, built a three-bed-
the Sears Modern Homes Facebook years. Now he is working to undo subcontractors are in greater de- designs. And most of her com- room, two-bathroom, 2,760-
page and writes the Sears House the changes, including restoring mand, more people are opting for panys customers hire contractors square-foot Shelter-kit house in
Seeker blog about the kit houses the porch railings, and he has kit homesand these are typically to build the homes. Ypsilanti, Mich., in nine months.
she finds around the country. She plans to take off the aluminum sid- bigger than their predecessors. Bob Andreasen built a 7,000- The home, finished in March, cost
says there are over 8,200 docu- ing. Its a shift, says Dave Kimball, square-foot Lindal kit home as a $125,000 and included everything
mented Sears kit homes and While awareness of kit homes whose Warner, N.H.-based com- vacation house for his daughters except the land. His wife, Grace,
around 1,000 from the other kit has increased, there is no orga- pany Shelter-Kit has shipped com- and grandchildren in Sheffield, 33, hung most of the drywall. Hav-
companies. nized effort to try to save them. ponents for homes as large as Mass. He says the quality of the ing never built a house himself, he
When Eric Romain, a 32, an Gloria Henn recently put the 1,584- 8,000 square feeta product that materials was better than he could had a tough time convincing the
auto-industry engineer, and his square-foot, four-bedroom kit cost $300,000. Like most modern source himself and the cost, at bank to give him a construction
wife, Jenna, 28, an accountant, house her husbands grandfather kit homes, Shelter-Kit includes ev- $220 a square foot for the finished loan. Everyone is always
bought their 1,400-square-foot built in the 1950s in Mashpee, erything needed to create the product, was lower than a new amazed, he says.