Relations between China and Japan have been strained since World War II. But now, the regional clash is having a global economic effect, Andrew Ross Sorkin writes in the DealBook column. The battle was on full display last week at the World Economic Forum in Davos, Switzerland, setting off fears that the souring relationship could pose direct economic risk to businesses across the globe. And there may be no one to defuse the situation.
Mr. Sorkin writes: “One of the greatest challenges multinational companies doing business in the region may face is that the United States government may not be positioned to step into the middle of the debate.â€
BITCOIN EXECUTIVE ARRESTED  | Bitcoin continued to make headlines on Monday with the disclosure that one of the virtual currency’s most prominent players, Charles Shrem, was arrested on Sunday at John F. Kennedy International Airport. He was charged with conspiring to launder money using his company, a Brooklyn-based Bitcoin exchange called BitInstant, Nathaniel Popper writes in DealBook. His business partner, Robert Faiella, who is known as BTCKing, was also arrested on Monday at his Florida home in connection with the money-laundering scheme.
BitInstant won backing last year from Winklevoss Capital, which is run by the twins Tyler and Cameron Winklevoss of Facebook fame. In a statement, Winklevoss Capital said, “We fully support any and all governmental efforts to ensure that money-laundering requirements are enforced, and look forward to clearer regulation being implemented on the purchase and sale of Bitcoins.â€
Unrelated to the arrests, Benjamin M. Lawsky, the New York State superintendent of financial services, is set to hold a two-day hearing on the legality of Bitcoin starting on Tuesday.
DIFFERENT MEDIUM, SAME MESSAGE FOR PERKINS  | It is usually considered good practice to stay on point. But perhaps not after comparing criticism of America’s wealthiest to Nazi attacks on Jews. On Monday evening, two days after The Wall Street Journal published a letter by the venture capitalist Thomas J. Perkins in which he questioned whether “progressive radicalism†indicated the possibility of a new Kristallnacht, Mr. Perkins appeared on television, sticking to his message that those in the 1 percent were being demonized by the 99 percent.
During the interview on Bloomberg Television, Mr. Perkins, a founder of the venture capital firm Kleiner Perkins Caufield & Byers, said he regretted using the word Kristallnacht. “My point was that, when you start to use hatred against a minority, it can get out of control,†Mr. Perkins said. “I regret the use of that word. It was a terrible misjudgment,†he said. “I don’t regret the message at all.â€
While Mr. Perkins remained committed to message during the interview, he also managed to discuss a wide range of topics, including his watch (a Richard Mille worth hundreds of thousands of dollars), his former wife (the author Danielle Steel) and his underwater airplane.
ON THE AGENDA  | The Federal Open Market Committee convenes its January meeting. The Standard & Poor’s/Case-Shiller home price index for October is released at 9 a.m. The consumer confidence index for January comes out at 10 a.m. President Obama delivers the State of the Union address at 9 p.m. Comcast releases earnings before the bell. AT&T and Yahoo release earnings after the market closes. The New York Department of Financial Services holds a hearing at 10 a.m. on the regulation of digital currencies. The Senate Committee on Banking, Housing and Urban Affairs holds a hearing at 10 a.m. on the Export-Import Bank of the United States. The House Committee on Financial Services holds a hearing at 10 a.m. on the Consumer Financial Protection Bureau.
VODAFONE: HUNTER OR PREY?  | Vodafone, the British telecommunications giant, is at a crossroads. Despite making a number of deals in the last year to expand its offerings, Vodafone could soon become a takeover target, Mark Scott writes in DealBook. And while the company is known for engineering the largest corporate acquisition in history (last year’s $130 billion deal to sell its 45 percent stake in Verizon Wireless to Verizon Communications), its path forward is uncertain.
Speculation that AT&T might be looking to purchase Vodafone have been swirling since last week, when AT&T’s chief executive met with the European commissioner who oversees the Continent’s telecommunications sector in Davos, Switzerland. Though AT&T announced on Monday that it was not in talks to purchase Vodafone, valued at more than $100 billion, the denial only fanned the speculative flames. Indeed, “no other target offers the same blend of scale, mobile focus and freedom from political interference,†Quentin Webb writes for Reuters Breakingviews.
And while Vodafone has operations in emerging markets, its dependence on its core European business makes it especially vulnerable. “That reliance on sluggish European economies has led analysts and investors to speculate that the company may be open to a takeover approach from a large international rival that would add Vodafone’s European and developing markets operations to its existing global business,†Mr. Scott writes.
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Martin Marietta Materials to Acquire Texas Industries  | The acquisition of the construction supplies company Texas Industries for about $72 a share will allow Martin Marietta Materials to move past its failed bid for Vulcan Materials two years ago. DealBook »
Bank of Montreal Parent to Buy British Fund Manager  | The Bank of Montreal’s parent has agreed to buy the fund manager F&C Asset Management for $1.2 billion, Reuters reports. REUTERS
Comcast and Charter Near Agreement on Time Warner Assets  | The Comcast Corporation is close to a deal to buy cable assets in New York City, North Carolina and New England from Charter Communications if Charter succeeds in acquiring Time Warner Cable, Bloomberg News reports, citing unidentified people familiar with the situation. BLOOMBERG NEWS
Time Warner Cable Hires Centerview  | Time Warner Cable has hired the investment bank Centerview to advise the company on Charter Communications’ $61 billion takeover bid, The Financial Times writes. FINANCIAL TIMES
United Technologies Considers Sale or Spinoff of Sikorsky  | United Technologies is considering Sikorsky, the maker of the Black Hawk helicopter, as a candidate for a tax-free spinoff or potentially a sale to a rival. DealBook »
Google Acquires British Artificial Intelligence Developer  | Google has acquired DeepMind Technologies, a British start-up whose founders include Demis Hassabis, a computer game designer, neuroscientist and former child chess prodigy. DealBook »
Bair, a Critic of the Revolving Door, Joins Board of Santander  | Sheila C. Bair, who ran the Federal Deposit Insurance Corporation, once argued that former regulators should be barred from joining the banks they oversaw. Though Santander is based in Madrid, it has extensive operations in the United States. DealBook »
Past Sins Haunt Royal Bank of Scotland  | The bank said it would set aside 3 billion pounds, or nearly $5 billion, to cover litigation losses tied to soured mortgage-backed securities and other assets sold before the financial crisis began. DealBook »
In Recruiting Game, Wall Street Still Competes  | As this year’s recruiting season begins, some college students say they view finance positions as springboards for later careers, while others are drawn to the challenge and fast-paced environment. Still others are, naturally, motivated by the high salaries that Wall Street offers. DealBook »
Former JPMorgan Executive Said to Settle Hiring Dispute  | JPMorgan Chase appears to have settled a dispute with Frank Bisignano, a former close confidant of its chairman, Jamie Dimon, the latest reminder that the inner circle that helped the bank weather the financial crisis is no more. DealBook »
JPMorgan to Decide on Dimon’s Stock Options  | JPMorgan Chase’s board must resolve whether Jamie Dimon, the bank’s chairman and chief executive, can collect two million stock options valued at about $34 million, Bloomberg News writes. BLOOMBERG NEWS
Study Puts Price Tag on ‘Too Big to Fail’  | An analysis commissioned by the Green Party in the European Parliament estimates that the cost of the implicit guarantee that governments will back large financial institutions was about 234 billion euros in 2012. DealBook »
K.K.R. to Buy Sedgwick, an Insurance Claims Processor  | The $2.4 Billion deal for Sedgwick Claims Management Services is the latest multibillion-dollar transaction by Kohlberg Kravis Roberts in recent months. DealBook »
Thoma Bravo Explores Sale of Blue Coat  | The private equity firm Thoma Bravo is considering a sale of Blue Coat Systems, a maker of enterprise security and network software, which it acquired in February 2012 for $1.3 billion, Reuters reports, citing unidentified people familiar with the situation. REUTERS
Kravis Named Chairman of Education Charity  | Henry R. Kravis, a co-founder of the private equity giant Kohlberg Kravis Roberts, has been elected chairman of the board of Sponsors for Educational Opportunity, a charitable organization based in New York. DealBook »
The Story of Trilantic Capital  | Charlie Ayers, the chairman of the private equity firm Trilantic Capital Partners, discusses how he spun out the firm from Lehman Brothers in a video by Privcap. PRIVCAP
Distressed Debt Hedge Fund Commits $530 Million to Europe  | Marathon Asset Management has gained a reputation for finding opportunities by picking over what is left in the aftermath of financial disaster. It is starting a new fund dedicated to distressed debt in Europe. DealBook »
Herbalife Shares Rise After Bullish Analyst Takes New Job  | Timothy Ramey has resigned from his job as an analyst at D.A. Davidson to serve as a consultant for Post Holdings, the parent company of the maker of cereals and other foods. The chief executive of Post is the fourth-largest shareholder of Herbalife. DealBook »
Elliott Management Cultivates Activist Image  | Elliott Management, the hedge fund started by Paul E. Singer, used to be in the practice of distressed debt investing but has lately been building a reputation as an activist investor, The Financial Times reports. FINANCIAL TIMES
Tiger Global to Invest in Brazilian Online Retailer  | The hedge fund will invest nearly $520 million in the Brazilian online retailer B2W Companhia Digital, a sign that it continues to see promise in Brazil’s vibrant Internet sector. DealBook »
Judge Throws Out Racketeering Claims Filed by Cohen’s Former Wife  | A judge narrowed the scope of a civil lawsuit filed by Patricia Cohen, Steven A. Cohen’s ex-wife. But he had some choice words about their continuing legal squabbles. DealBook »
File-Sharing Platforms Could Be I.P.O. Candidates  | File-sharing companies like Box and Dropbox are considering initial public offerings, The Wall Street Journal reports. Accellion, a file-sharing company for mobile and nonmobile devices, is also considering an I.P.O. WALL STREET JOURNAL
Fund Managers Concerned With Expected Number of London I.P.O.’s  | Small-cap fund managers have expressed concern that a high number of initial public offerings on the London Stock Exchange could make it impossible for them to provide enough funds to companies, The Financial Times reports. Some fund managers may need to sell existing investments to fund purchases of new shares. FINANCIAL TIMES
Bitcoin and the Fictions of Money  | The venture capitalist Marc Andreessen and other experts have weighed in on the promise and pitfalls of Bitcoin, but so far, there is little discussion of what the collective decision to believe a fiction like Bitcoin might mean, Quentin Hardy writes in the Bits blog. NEW YORK TIMES BITS
Opposite Coasts Duel on Bitcoin Rules  | California and New York are both preparing to write regulations on how investors can use Bitcoin and other virtual currencies, Bloomberg News reports. BLOOMBERG NEWS
Chinese Market Entices Venture Capitalists Again  | After a number of recent initial public offerings by Chinese companies, venture capitalists are looking for deals again in mainland China, The Wall Street Journal reports. WALL STREET JOURNAL
Venture Capital Extending Its Reach  | Though venture capital firms used to invest largely in technology companies, they are increasingly providing funding to companies that sell low-tech or no-tech products, TechCrunch writes. TECHCRUNCH
Venture Capitalist Heads to Japan  | Gen Isayama, chief executive of the venture capital firm WiL, is starting a $300 million fund in Japan, Bloomberg Businessweek reports. BLOOMBERG BUSINESSWEEK
Securities Class-Action Suits Up Slightly in 2013  | More class-action lawsuits were filed against public companies in 2013 than in the previous year, but the filers were seeking billions less in damages than they have on average. DealBook »
U.S. Relaxes Some Data Disclosure Rules  | The Obama administration will allow Internet companies to talk more specifically about when they are required to turn over customer data to government agents, the Justice Department said on Monday. NEW YORK TIMES
Fed President Urges More Stimulus  | Narayana R. Kocherlakota, president of the Federal Reserve Bank of Minneapolis, said the central bank should increase its efforts to stimulate the economy â€" a view he conceded had not gained much traction with his colleagues. NEW YORK TIMES
As Loehmann’s Liquidates, Bargains Get Bigger as Shelves Get Emptier  | Loehmann’s, which filed for bankruptcy last year, began liquidating its collection of discount clothes and other merchandise earlier this month. But some customers may have been dismayed to see markdowns that averaged just 30 percent. DealBook »
Senior Justice Department Attorney to Join Morrison & Foerster  | Charles Duross, who led the Justice Department’s unit that enforces the Foreign Corrupt Practices Act, is joining the law firm Morrison & Foerster as head of its global anticorruption practice. DealBook »
