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Schwartz to retire from Goldman, Solomon to serve as sole president

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David Solomon, co-president and co-chief operating officer of Goldman Sachs Group Inc., gives a thumbs-up during a discussion at the Goldman Sachs 10,000 Small Businesses Summit in Washington, D.C., on Tuesday, Feb. 13, 2018.

Andrew Harrer | Bloomberg | Getty Images

David Solomon, co-president and co-chief operating officer of Goldman Sachs Group Inc., gives a thumbs-up during a discussion at the Goldman Sachs 10,000 Small Businesses Summit in Washington, D.C., on Tuesday, Feb. 13, 2018.

Goldman began actively considering Blankfein’s successor after he was diagnosed with a treatable form of lymphoma in 2015, for he received chemotherapy and was cancer-free by October 2016. He has not indicated a time when he will step down, and there’s been speculation that he could hold off until 2019 and perhaps stay on as chairman even after leaving the CEO position.

The decision was made at a Feb. 20-21 board meeting, sources told CNBC.

“The board has been intensely focused on this for a couple years,” said a source familiar with the board’s thinking. Blankfein will be leaving “sooner rather than later,” and no one else has been seriously considered as his successor beyond Schwartz and Solomon, the source added.

Goldman shares, which have underperformed for much of Blankfein’s tenure, were up 1.4 percent after the announcement to a record high. Analysts generally reacted positively to the news.

“David Solomon ran the best growing part of Goldman for the decade before assuming the COO position 15 months ago,” Wells Fargo analyst Mike Mayo said in a note. “The challenge and opportunity, in our opinion, is for Goldman to better monetize its corporate CEO relationships for deeper activities with both banking and trading.

Vertical Group analyst Dick Bove, who has called repeatedly for Blankfein’s ouster, said the moves announced Monday showed that the board “understands that the company was pursuing the wrong business model. … The firm is now likely to go ‘all-in’ to investment banking and lending. Selecting David Solomon to lead this new charge is absolutely the right decision. He is a highly qualified banker in a firm with a superb investment banking business.”

KBW analyst Brian Kleinhanzl added, “We have met with David Solomon in the past and we believe him to be a capable leader at GS with significant experience running the investment bank and a longstanding member of GS’ management committee.”

With trading volumes drying up and regulators still honing in on big banks, it’s been a difficult time for Wall Street institutions like Goldman.

The firm is expected to refine its focus on investment banking and has been encouraged to take over small competitors to expand its base.

“Lloyd managed to steer it fine,” said Christopher Whalen, head of Whalen Global Advisors. “If you look back over that period, they really didn’t take huge lumps and they managed to avoid most of the risk.”

Schwartz has been with Goldman for 20 years, moving from securities and investment banking up to the chief financial officer position and most recently as president and co-chief operating officer with Solomon.

Solomon, who has been with Goldman since 1999, served 10 years as co-head of the investment banking division before ascending to his current position. (Outside Goldman, he’s also known as a DJ D-Sol.)

“We expect the transition to go smoothly,” said Charles Peabody, an analyst at Compass Point Research. “We expect no change in strategic direction. If there is a risk, it’s largely likely to be confined to cultural, and not financial or strategic, issues.”

—With reporting by Andrew Ross Sorkin.



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Three options strategies for the week: August 20

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The “Options Action” traders share three options trading strategies to kick off the week.

Dan Nathan recommends a call spread in Alibaba.

Mike Khouw recommends a put spread in the Energy ETF

Mike Khouw recommends an iron condor strategy in the Russell 2000 ETF

Trader disclosure: On July 17, 2018, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s “Options Action” were owned by the “Options Action” traders: Dan Nathan is long XLF Sept put spread. Dan is long CAT put spread. Dan is long QQQ Sept put spread. Dan is long SMH Oct put spread. Carter disclosures not available. Long S&P, HAL. Bearish on TSLA.



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cornhole wants to make it to the big leagues

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Ankit Mittal, of Ellicott City, Md., tosses a bean bag as his friend Shean Flynn, of Newport News, Va., waves his Terrible Towel as the two were playing Corn Hole while enjoying tailgating before the game between the Pittsburgh Steelers and Washington Redskins at FedEx Field in Landover, Md.

Ricky Carioti | The Washington Post | Getty Images

Ankit Mittal, of Ellicott City, Md., tosses a bean bag as his friend Shean Flynn, of Newport News, Va., waves his Terrible Towel as the two were playing Corn Hole while enjoying tailgating before the game between the Pittsburgh Steelers and Washington Redskins at FedEx Field in Landover, Md.

Every day after he leaves his job as a warehouse general manager, Cody Henderson runs up to three miles. Then, he sets up cornhole boards and practices throwing beanbags for a couple hours, focusing on timing, balance and precision.

“It helps a lot with the endurance and mental game,” Henderson, 27, told CNBC. “If you can sit there and not get bored in a quiet area for two or three hours, you are really going to set yourself up to succeed on the pro level.”

Succeed he has. Henderson, who lives in Jackson, Ohio, is the top-ranked player out of the 20,000 pros in the American Cornhole League (ACL). He says he earned between $20,000 and $25,000 in prize money last year. He’s peaking just as the sport is surging in popularity.

While cornhole is generally thought of as a beanbag tossing game played at family gatherings or tailgate parties, it’s gotten so big that players like Henderson are making their way to ESPN. During last year’s The Ocho, a one-day event for alternative sports on ESPN 2, the Championship of Bags was the most viewed competition.

In the 18 to 49 age group, more peopled watched cornhole on that day than the competing game coverage of Major League Baseball, the WNBA or the final stage of the Tour de France, according to Sports Media Watch.

For Henderson, cornhole requires 20 hours a week of training and tournaments on weekends. Still, he said most people don’t take him seriously when he says he plays professionally.

“They’ll say, ‘Oh yeah really?’ and just change the subject,” he said. “When people were seeing me on ESPN, everyone’s attitude changed.”



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TiVo falls on report Amazon is developing live TV recording device

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TIVO, Inc. gave a way free TIVO (DVR) Digital Video Recorder, boxes to thousands of happy Comcast Cable customers, who also donated a toy or clothing for charity outside their corporate headquarters.

Kim Kulish | Corbis | Getty Images

TIVO, Inc. gave a way free TIVO (DVR) Digital Video Recorder, boxes to thousands of happy Comcast Cable customers, who also donated a toy or clothing for charity outside their corporate headquarters.

Shares of TiVo fell as much as 10 percent in afternoon trading Friday following a Bloomberg report that Amazon is eyeing a live TV recording device.

TiVo pared losses and closed just 4 percent down at $12.20. The drop extends a challenging run for TiVo, which is now off 20 percent in 2018 and 30 percent in the last 12 months.

Amazon is known to scare investors and send stocks tumbling with news of a planned entrance into a new industry. Earlier this week, movie theater stocks dropped on a report that Amazon is considering a bid for Landmark Theaters.

Representatives for Amazon and TiVo were not immediately available to comment.



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