Rapper 'Fat Joe' admits evading taxes

Rap star "Fat Joe" faces up to two years in prison after pleading guilty Thursday to failing to pay taxes on nearly $3 million in income over two years. The performer, whose real name is Joseph Cartagena, entered the plea in federal court in New Jersey because some of the companies he earns money from are incorporated there. The 42-year-old Miami Beach, Fla., resident entered pleas to two counts covering years 2007 and 2008 but his sentencing will take into consideration the government's initial allegation that he failed to pay income taxes for years 2007 through 2010. Federal prosecutors said the total tax loss to the government for those four years was $718,038. Cartagena lawyer Jeffrey Lichtman said his client "had already taken steps to resolve this situation" before he was charged. He said the rapper hoped to pay back the taxes by the time of his sentencing April 3.

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Grammy nominee Bobby Sanabria feels like a winner

Bobby Sanabria already feels like a winner. The Latin jazz musician, who led the protest against the Recording Academy when it downsized from 109 to 78 categories last year, is nominated for best Latin jazz album — one of the awards that had been eliminated but returns at the awards show next year. "We're very proud," Sanabria said in a recent interview. "It just places emphasis on the importance of this uniquely American art form. ... Of all the forms of music that are still getting recognition from the Grammys, this is one of the most disenfranchised forms because it isn't part of mainstream culture." The Recording Academy announced in June that it would reinstate the best Latin Jazz album award and added two others, bringing the total number of awards 81. Sanabria's nomination in the category for "Multiverse," along with his Big Band, is his third time competing in the field. His band's song, "Afro-Cuban Jazz Suite for Ellington," is also nominated for best instrumental arrangement; the nomination goes to arranger Michael Philip Mossman. Bronx-born Sanabria said he's excited that the best Latin jazz album was restored, but he hopes the others come back as well. "CD sales are down, so the more categories we have, it's just good business," he said. The Academy shook up the music industry when it announced in April 2011 that it would downsize its categories to make the awards more competitive. That meant eliminating categories by gender, so men and women compete in the same vocal categories. Artists like Herbie Hancock, Paul Simon and Bill Cosby complained, and Sanabria led the group that filed a lawsuit, which was dismissed. The 55-year-old drummer and percussionist said that the Grammys cut is a sign of the dying appreciation of jazz and blues music in American culture. "We live in age now where DJs are more respected than musicians and I have nothing against DJs . but there's something to be said for the artistry of a human being taking a musical instrument and performing at a virtuosic level on it, and it takes years of dedication," he explained. "I read something that in New York City they're having trouble filling the demand for DJs for New Year's Eve, and that used to be the night all musicians worked. That isn't the case anymore and something needs to be changed in the culture, and the Grammys can help in that respect with categories like (best Latin jazz album) . and the classical music categories." Sanabria's latest album is a mixture of sounds, and he said he has his parents to thank for diversifying his musical exposure. He wants to win the Grammy so that they can witness it. "(They are in) their eighties now and they're not in good health (and) they were the impetus for me," he said. Among his competition for best Latin jazz album, Sanabria will battle one of his students from New York's The New School, Manuel Valera of the New Cuban Express. He said he's excited to see his student get this kind of recognition, and hopes other young adults will learn to appreciate jazz music's importance. On Feb. 8 and Feb. 9, a day before the Grammy Awards in Los Angeles, Sanabria is performing a concert special — "Family Concert: What is Latin Jazz?" — at Jazz at Lincoln Center in New York. "Without blues and jazz, you have nothing. There's no Beyonce, there's no Jay-Z, there's no Katy Perry, there's no Aerosmith," he said. "It's the foundation of American music and it's sad that it isn't being taught as part of the history curriculum at every public school."

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Global doomsday hot spots draw believers, revelers

Though the Mayans never really predicted that the world would end on Friday, some New Agers are convinced that humanity's demise is indeed imminent. Or at least that it's a good excuse for a party. Believers are being drawn to spots where they think their chances of survival will be better, and accompanying them are the curious, the party-lovers and people wanting to make some money. Here are some of the world's key doomsday destinations and other places marked by fear and fascination. MEXICO About 1,000 self-described shamans, seers, stargazers, crystal enthusiasts, yogis, sufis and swamis are gathering in a convention center in the city of Merida on the Yucatan peninsula about an hour and a half from the Mayan ruins at Chichen Itza, convinced that it was a good start to the coming "New Era," which was supposed to begin around 5 a.m. local time Friday. These are not people who believe the world will end on Friday: the summit is scheduled to run through Dec. 23. Instead, participants say, they want to celebrate the birth of a new age. Meanwhile, Mexico's self-styled "brujo mayor," or chief soothsayer, Antonio Vazquez Alba, who warned followers to stay away from all gatherings on Dec. 21. "We have to beware of mass psychosis" that could lead to stampedes or "mass suicides, of the kind we've seen before," he said. Also, organizers of Yucatan's broader Mayan Culture Festival saw the need to answer some of the now-debunked idea that the Mayas, who invented an amazingly accurate calendar almost 2,000 years ago, had somehow predicted the end of the world. The Yucatan state government asked a scientist to talk about the work of Large Hadron Collider in Switzerland to debunk the idea it could produce world-ending rogue particles. FRANCE According to one rumor, a rocky mountain in the French Pyrenees will be the sole place on earth to escape destruction. A giant UFO and aliens are said to be waiting under the mountain, ready to burst through and spirit those nearby to safety. But here is bad news for those seeking salvation: French gendarmes, some on horseback, are blocking outsiders from reaching the Bugarach peak and its village of some 200 people. One believer, Ludovic Broquet, a 30-year-old plumber, made his way to the mountain after a year of preparation, hoping to find a "gateway, the vortex that will open up here (at) the end of the world." Local residents, instead, are skeptical — and angry at having their peace disturbed. "What is going on here is the creation of an urban legend," fumed resident Michele Pous, who blamed those who spread Internet rumors. "They created a media frenzy, they created a false event, they manipulated people." RUSSIA For $1,500, a museum is offering salvation from the world's end in former Soviet dictator Josef Stalin's underground bunker in central Moscow — with a 50 percent refund if nothing happens. The bunker, located 65 meters (210 feet) below ground, was designed to withstand a nuclear attack. Now home to a small museum, it has an independent electricity supply, water and food — but no more room, because the museum has already sold out all 1,000 tickets. BRITAIN Hundreds of people have already converged on Stonehenge for an "End of the World" party that coincides with the Winter Solstice. Arthur Uther Pendragon, Britain's best-known druid, said he was anticipating a much larger crowd than usual at Stonehenge this year. But he doesn't agree that the world is ending, noting that he and fellow druids believe that things happen in cycles. "We're looking at it more as a new beginning than an end," he said. "We're looking at new hope." Meanwhile, end-of-days parties will be held across London on Friday. One event billed as a "last supper club" is offering a three-course meal served inside of an "ark." SERBIA Some Serbs are saying to forget that sacred mountain in the French Pyrenees. The place to go Friday will be Mount Rtanj, a pyramid-shaped peak in Serbia already drawing cultists. A local legend has it that the mountain once swallowed an evil sorcerer who will be released on doomsday in a ball of fire that will hit the mountain top. The inside of the mountain will then open up, becoming a safe place to hide as the sorcerer goes on to destroy the rest of the world. In the meantime, some old coal mine shafts have been opened up as safe rooms for the dozens who have arrived already. "We got calls from as far away as Holland from people trying to seek shelter," said Vlada Minic, a local villager. "They are asking to be as close as possible to the mountain." TURKEY A small Turkish village known for its wines, Sirince, has also been touted as the only place after Bugarach that would escape the world's end. But on Thursday there were more journalists and security officials present there than cultists — to the great disappointment of local restaurateurs and souvenir shop owners. Nobody was quite sure where Sirince's alleged powers to survive the Mayan doomsday come from, but the idyllic village in western Turkey is close to an area where the Virgin Mary is believed to have lived her final days, and some New Agers reportedly believe the region has a positive aura. For months, local business owners have been promoting the village and even produced wines with special labels to commemorate the event. ITALY Another spot said to be spared: Cisternino, in southern Italy, plans a big party Friday with hot-air balloons and music in the main piazza. "Nobody will want to sleep anyway as they await the end of the world," Mayor Donato Baccaro was quoted as saying in the newspaper La Stampa on Wednesday. Though Baccaro goes on to say he doesn't really believe the end is coming, hundreds have reportedly booked hotel rooms. CHINA A fringe Christian group has been spreading rumors about the world's impending end, prompting Chinese authorities to detain more than 500 people this week and seize leaflets, video discs, books and other material. Those detained are reported to be members of the group Almighty God, also called Eastern Lightning, which preaches that Jesus has reappeared as a woman in central China. Authorities in the province of Qinghai say they are waging a "severe crackdown" on the group, accusing it of attacking the Communist Party and the government. UNITED STATES For some, doomsday will be a chance for mockery. Giorgio A. Tsoukalos, producer and host of the History Channel's "Ancient Aliens" program, is throwing a party in New Orleans on Friday where he will descend onstage in a mock spaceship. Tsoukalos is a leading proponent of the idea that ancient myths arose from visits by alien astronauts, an idea rejected by many mainstream researchers. Still, Tsoukalos scoffs at the idea that the world will come to an end Friday.

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Smallest state goes big on Miss Universe pride

The city of Cranston is known — sort of — for being the one-time home of the Narragansett Brewing Company, and it scored a mention in the Jim Carrey flick "Dumb and Dumber." But the city has suddenly found itself at the center of the universe. The nation's smallest state has gone big on pride after Cranston native Olivia Culpo snagged the Miss Universe title on Wednesday night in Las Vegas, beating out 88 other women from six continents to bring the title back to the U.S. for the first time since 1997. Cranston Mayor Allan Fung calls it "mind-boggling" to have his city of 80,000 residents, the third largest in Rhode Island, put on the map for an international audience. He says Culpo's win is inspirational for the city, state and nation. "To have Olivia perform the way she did, with the poise that she did, coming from where she came from, it provides this really feel good moment," he said Thursday. "She's going to be a wonderful ambassador for Cranston in particular, her hometown, but our state and our country." Fung gave the 20-year-old Boston University student a key to the city after she was crowned Miss USA in June, the first time anyone from Rhode Island had won the title. A tree was planted in her honor at City Hall, and a band of students from local high schools played. Culpo herself is an accomplished cellist. Fung said she can have another key to the city — or whatever she wants — given her beauty pageant promotion. "She is the center of the universe," he said. In an interview, Culpo thanked Rhode Islanders for their support and said she loves the state "where it all started." "I think it's cool to put Rhode Island on the map," she said. "To be able to have come from such a small place and to now be representing so much is so cool." Rhode Island residents' nerves were on edge after Culpo tripped slightly during the competition's evening gown segment. She then was asked a question about whether she had ever done something she regretted; she said you learn from every experience, good or bad, but that she regretted picking on her siblings growing up. After she was crowned, congratulations flooded Twitter, including from her former Catholic school in East Providence, St. Mary Academy Bay View; Providence Mayor Angel Taveras; even Rhode Island's most famous seller of its trademark hot wieners, Olneyville New York System. U.S. Rep. David Cicilline sent out a news release including a picture of her in a white dress and her Miss USA sash that was taken outside his Washington, D.C., office. He said she had already made Rhode Island proud but that "her success tonight is an even greater source of pride for the Ocean State." While Culpo will be back in Rhode Island for the holidays, no official appearances as Miss Universe are planned. She said she's looking forward to seeing one of Providence's landmarks while she's home: the giant termite atop a pest control business near downtown.

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Broadway's 'Newsies' recoups its investment

The boys from "Newsies" now have one more thing to dance about — they've made their money back. Disney Theatrical Productions said Thursday that the musical recouped its $5 million investment in just over nine months — faster than any other Disney stage property. The profitability of "Newsies" adds to Disney's high success rate on Broadway. The entertainment giant has had now five hits — including "The Lion King" and "Mary Poppins" — from seven Broadway shows it has produced, way above the 3-in-10 average recoupment of most Broadway shows. "Newsies" is based on the 1899 true story of child newspaper sellers in turn-of-the-century New York who go on strike. A 1992 film, starring Christian Bale, Bill Pullman, Robert Duvall and Ann-Margret, did poorly at the box office but has become something of a cult hit. Composer Alan Menken and lyricist Jack Feldman, who were responsible for the film score, teamed up again to transform "Newsies" into a musical for the stage, reworking the songs and collaborating with the new story writer, Harvey Fierstein, known for his work in "Hairspray," ''La Cage aux folles" and "Torch Song Trilogy." The new musical retains the memorable songs "Santa Fe," ''The World Will Know," ''Carrying the Banner," ''Seize the Day" and "King of New York," but adds a young female reporter to the story and plenty of muscular, high-impact dancing. The show had a critically acclaimed debut in September 2011 at the Paper Mill Playhouse in Millburn, N.J., and opened on Broadway in March at the the Nederlander Theatre, where it won Tony Awards for best score and choreography. So far, nearly 400,000 people have seen the show in its 41 weeks of performances and it has regularly been among the top earning shows each week.

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ICE's NYSE swoop creates derivatives giant

LONDON/NEW YORK (Reuters) - IntercontinentalExchange Inc agreed as part of its $8.2 billion takeover of NYSE Euronext to pay the New York Stock Exchange operator a termination fee of $750 million if it fails to gain antitrust clearances, suggesting a high level of confidence the deal will go through. Big Board parent NYSE could get out of the arrangement for a fee of $300 million if a sweeter deal were to come along, according to a regulatory filing on Friday. ICE failed last year to buy NYSE in a joint bid with Nasdaq OMX Group . At the time, NYSE was involved in year-long pursuit to sell itself to Frankfurt's Deutsche Bourse. In the end, regulators killed both deals, saying they would be anti-competitive. On its own, Atlanta-based ICE lacks the massive equities operations of Nasdaq or Deutsche Bourse, so there is less overlap between the two exchanges, antitrust lawyers said, making regulatory approval far more likely. Some in the industry have suggested that CME Group could table a competing offer for NYSE, but they said that would not be likely for several reasons, including the break-up fee. People familiar with the deal said other issues include potential antitrust concerns and the fact that under the latest agreement, NYSE's Liffe business will do all its clearing through ICE regardless of whether the deal goes through. "The clearing deal they signed is like a second break-up fee," one of the people said. Also, CME has not been known for making large deals. "It does not seem to be in its DNA," said Adam Sussman, director of research at Tabb Group. NYSE CEO Duncan Niederauer acknowledged a higher bid could come along, but that NYSE would not chase after a deal unless it was almost certain it would pass regulatory muster. "If we did that for another year and at the end we are told, 'we are not going to allow you to do this because of the overlap of your businesses,' we would look beyond foolish," he said in an interview on Thursday. FOUR-WAY BATTLE The deal, announced Thursday, would give 12-year old commodities and energy bourse ICE a powerful presence in Europe's lucrative financial derivatives market through control of NYSE Liffe, Europe's second-largest futures exchange, and a major advantage over U.S.-based rivals CME and Nasdaq. All three want to challenge Deutsche Boerse's European dominance. A shake-up in banking regulation is expected to increase demand sharply for clearing financial derivatives through such exchanges. "The deal would place a bigger and more aggressive competitor on Deutsche Boerse's doorstep," said Richard Perrott, an analyst at Berenberg Bank. Regulatory changes in the wake of the financial crisis are forcing banks to channel derivatives business through clearing houses and regulated exchanges to ensure their risk positions can be better monitored than they were when bank dealers were trading complex contracts directly among themselves. The reforms are expected to be fully operational in Europe in 2014. ICE's takeover of NYSE Liffe will give it an advantage of existing presence in Europe over Chicago-based CME, owner of the world's largest futures market, and New York's Nasdaq, both of which plan to open their own London-based exchanges next year. THE PRIZE While the New York Stock Exchange, an enduring symbol of American capitalism, is NYSE Euronext's prestige business, London's Liffe is the real jewel in the crown. With profits from stock trading significantly eroded by new technology and the rise of other places for investors to trade, the stock market businesses like NYSE are less valuable to ICE. The company has said it will try to spin off NYSE's Euronext European stock market businesses in a public offering. This has generated speculation, which the company has denied, that it may also have little interest in the NYSE trading floor on Wall Street. NYSE made an operating income of $473 million from Liffe in 2011 on revenues of $861 million compared to an income of $533 million on revenues of $1.3 billion from its equities business. ICE's Jeff Sprecher will be CEO of the combined organisation and Duncan Niederauer, the NYSE Euronext CEO, will be president - a post he said he plans to remain in until at least 2014. The two are longtime friends. ICE started out as an online marketplace for energy trading before Sprecher initiated a string of acquisitions, from the London-based International Petroleum Exchange in 2001, to the New York Board of Trade and, most recently, a handful of smaller deals, including a climate products exchange and a stake in a Brazilian clearing house. A combined ICE-NYSE Euronext would leapfrog Deutsche Boerse to become the world's third largest exchange group with a combined market value of $15.2 billion. CME Group has a market value of $17.5 billion, Thomson Reuters data shows.

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Stocks sink after Republicans cancel budget vote

NEW YORK (AP) — Investors sent Washington a reminder Friday that Wall Street is a power player in talks to avoid the "fiscal cliff." Stocks fell sharply after House Republicans called off a vote on tax rates and left federal budget talks in disarray 10 days before sweeping tax increases and government spending cuts are scheduled to take effect. The Dow Jones industrial average lost as much as 189 points before closing down 120.88 points, or 0.9 percent, at 13,190.84. The Standard & Poor's 500 index fell 13.54 points to 1,430.15. The Nasdaq composite index declined 29.38 to 3,021.01. The House bill would have raised taxes on Americans making at least $1 million per year and locked in decade-old tax cuts for Americans making less. Taxes will rise for almost all Americans on Jan. 1 unless Congress acts. House Speaker John Boehner had presented what he called "Plan B" while he negotiated with the White House on avoiding the sweeping tax increases and spending cuts, a combination known as the fiscal cliff. But Boehner scrapped a vote on the bill Thursday night after it became clear that it did not have enough support in the Republican-led House to secure passage. He called on the White House and the Democratic-led Senate to work something out. The market's decline demonstrated that investors' nerves are raw as they await a resolution. "Where we are today, the market would be satisfied with the announcement of a stopgap measure," said Quincy Krosby, a market strategist at Prudential Financial. "The more the clock ticks, the more the market is saying, 'Just give us something.'" Sal Arnuk, a partner at Themis Trading, suggested that the sharp drop in stocks early in the day might have been an overreaction. The Dow was down as much as 189 points, and before the market opened, stock futures suggested a decline of 200 points or more. "It's not a surprise that they weren't able to come to an agreement," he said. I don't think most of Wall Street anticipated that they would come to an agreement." Other markets registered their concern, but the reaction was not extreme. The yield on the benchmark 10-year U.S. Treasury note fell 0.04 percentage point to 1.76 percent. The price of gold, which some investors buy when fear overtakes the market, climbed, but only by 0.9 percent. Gold rose $14.20 to $1,660.10 an ounce. If the full fiscal cliff takes effect, economists say it could drag the United States into recession next year. The impact would be gradual, though, and a recession is not a sure thing. Most people would receive only slightly less money in each paycheck. And the tax increases and spending cuts could be retroactively repealed if a deal comes together after Jan. 1. If budget talks dragged on, many businesses might put off investment or hiring, and consumer spending could suffer. That's why most economists say it would be crucial to reach a deal within roughly the first two months of 2013. "Believe you me," Krosby said, "if you think that there is a recession in the offing you are going to see this market sell off. It's sell off first, ask questions later." It was not the first time that Wall Street worried about the fiscal cliff talks. On the day after the election, when voters returned divided government to power, the Dow dropped 312 points. On Nov. 14, when President Barack Obama insisted on higher tax rates for the wealthy, the Dow dropped 185 points. The sharp drop in stocks Friday was reminiscent of, although much smaller in scale than, what happened Sept. 29, 2008, during the financial crisis. The House defeated a proposed $700 billion bailout of the U.S. financial industry, and the Dow plunged 777 points, its worst one-day decline. Four days later, the House, shaken by what had happened on Wall Street, passed a modified bill. Stocks closed lower Friday in Asia after House Republicans canceled their vote. The Nikkei index in Japan fell almost 1 percent, and Hong Kong's Hang Seng Index dropped 0.7 percent. Stocks were also lower in Europe. Among stocks making big moves: — Walgreen, the nation's largest drugstore chain, slumped $1.24, or 3.3 percent, to $36.31. It filled fewer prescriptions and absorbed costs tied to acquisitions and Superstorm Sandy. The results were worse than financial analysts had been expecting. — BlackBerry maker Research in Motion dropped $2.21, or 15.8 percent, to $11.74. The company said it won't generate as much revenue from telecommunications carriers once it releases the BlackBerry 10. — Nike, the world's largest maker of athletic gear, jumped $6.10, or 6.2 percent, to $105.10. It said strong demand in North America led to a 7 percent increase in revenue in the three months ended Nov. 30, balancing out economic weakness in Europe and a slowdown in growth in China. — Micron Technology dropped 6.9 percent, the biggest decline in the S&P 500 index. The semiconductor maker reported a loss late Thursday as weaker demand for personal computers and an oversupply of certain chips hurt its sales. The stock lost 47 cents to $6.32.

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Titan Advisors withdraws funds from SAC Capital - WSJ

(Reuters) - Titan Advisors LLC has decided to withdraw all of its money from the hedge fund firm SAC Capital Advisors LP, the Wall Street Journal reported on Friday, as SAC faces scrutiny because of several employees linked to insider-trading charges. It's unclear how much money Titan, an asset-management firm based in New York, had invested with SAC for its clients, although it has $3 billion invested in hedge funds overall, according to a March securities filing. In its article, the Journal cited clients who said they were told that Titan would withdraw investments in SAC. The withdrawal is notable because Titan Advisors founder George Fox was one of the early investors in SAC Capital, the Journal said. Fox did not respond to a voicemail message. A spokesman for SAC Capital said the firm did not have a comment. SAC is run by billionaire Steven A. Cohen, and came to prominence in the late 1990s for its outsized returns. The firm has posted returns of roughly 30 percent a year since its inception. But more recently, SAC Capital has garnered attention for employees' run-ins with regulators and criminal authorities investigating insider-trading on Wall Street. On Friday, ex-SAC fund manager Mathew Martoma was indicted by a grand jury in New York, becoming the seventh former SAC employee to be charged or implicated in insider-trading schemes.

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Wall Street ends lower after "fiscal cliff" setback

NEW YORK (Reuters) - U.S. stocks finished lower on Friday after a Republican plan to avoid the "fiscal cliff" failed to gain sufficient support on Thursday night, draining hopes that a deal would be reached before 2013. Still, stocks managed to rebound from the day's lows near the end of the session, and for the week, the three major U.S. stock indexes still ended higher, with the S&P 500 gaining 1.2 percent. Trading was volatile because of waning confidence in the prospect of a deal out of Washington, and in part, as the result of the quarterly expiration of options and futures contracts. The CBOE Volatility Index <.vix> or VIX, the market's favorite barometer of investor anxiety, finished below its session high. Republican House Speaker John Boehner failed to garner enough votes from even his own party to pass his "Plan B" tax bill late on Thursday. It was the latest setback in negotiations to avoid $600 billion in tax hikes and spending cuts that some say could tip the U.S. economy into recession. "The failure with Plan B was disappointing, if not terribly surprising, but now there's a real lack of clarity about what will happen, and markets hate that," said Mike Hennessy, managing director of investments for Morgan Creek in Chapel Hill, North Carolina. The Dow Jones industrial average <.dji> dropped 120.88 points, or 0.91 percent, to 13,190.84 at the close. The Standard & Poor's 500 Index <.spx> fell 13.54 points, or 0.94 percent, to 1,430.15. The Nasdaq Composite Index <.ixic> lost 29.38 points, or 0.96 percent, to 3,021.01. "Amazingly, this sharp decline today may not actually change the technical picture much - unless the decline gets worse," said Larry McMillan, president of options research firm McMillan Analysis Corp, in a research note. For the week, the Dow gained 0.4 percent and the Nasdaq climbed 1.7 percent. On Friday, Herbalife dropped for an eighth straight session. Investor Bill Ackman recently ramped up his campaign against the company. The stock skidded 19.2 percent to $27.27 and has lost more than 35 percent this week. Plan B, which called for tax increases on those who earn $1 million or more a year, was not going to pass the Democratic-led Senate or win acceptance from the White House anyway. But it exposed the reality that it will be difficult to get Republican support for the more expansive tax increases that President Barack Obama has urged. Still, the declines of about 1 percent in the three major U.S. stock indexes suggest that investors do not believe the economy will be unduly damaged by the absence of a deal, said Mark Lehmann, president of JMP Securities, in San Francisco. "You could have easily woken up today and seen the market down 300 or 400 points, and everyone would have said, 'That's telling you this is really dire,'" Lehmann said. "I think if you get into mid-January and (the talks) keep going like this, you get worried, but I don't think we're going to get there." Banking shares, which outperform during economic expansion and have led the market on signs of progress on resolving the fiscal impasse, led Friday's declines. Citigroup Inc fell 1.7 percent to $39.49, while Bank of America slid 2 percent to $11.29. The KBW Banks index <.bkx> lost 1.19 percent. Volatility on Friday was exacerbated in part by "quadruple witching," the quarterly expiration of stock index futures and options, stock options and single stock futures contracts. About 8.59 billion shares changed hands on major U.S. exchanges, more than the daily average of 6.47 billion daily in 2012, in part because of the "quadruple witching" expiration. The day's round of data indicated the economy was surprisingly resilient in November; consumer spending rose by the most in three years and a gauge of business investment jumped. But separate data showed consumer sentiment slumped in December. The S&P Retail Index <.spxrt> fell 1.2 percent. U.S.-listed shares of Research in Motion sank 22.7 percent to $10.91 after the Canadian company, known as the BlackBerry maker, reported its first-ever decline in its subscriber numbers on Thursday alongside a new fee structure for its high-margin services segment.

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Wall Street Week Ahead: A lump of coal for 'Fiscal Cliff-mas'

NEW YORK (Reuters) - Wall Street traders are going to have to pack their tablets and work computers in their holiday luggage after all. A traditionally quiet week could become hellish for traders as politicians in Washington are likely to fall short of an agreement to deal with $600 billion in tax hikes and spending cuts due to kick in early next year. Many economists forecast that this "fiscal cliff" will push the economy into recession. Thursday's debacle in the U.S. House of Representatives, where Speaker John Boehner failed to secure passage of his own bill that was meant to pressure President Obama and Senate Democrats, only added to worry that the protracted budget talks will stretch into 2013. Still, the market remains resilient. Friday's decline on Wall Street, triggered by Boehner's fiasco, was not enough to prevent the S&P 500 from posting its best week in four. "The markets have been sort of taking this in stride," said Sandy Lincoln, chief market strategist at BMO Asset Management U.S. in Chicago, which has about $38 billion in assets under management. "The markets still basically believe that something will be done," he said. If something happens next week, it will come in a short time frame. Markets will be open for a half-day on Christmas Eve, when Congress will not be in session, and will close on Tuesday for Christmas. Wall Street will resume regular stock trading on Wednesday, but volume is expected to be light throughout the rest of the week with scores of market participants away on a holiday break. For the week, the three major U.S. stock indexes posted gains, with the Dow Jones industrial average up 0.4 percent, the S&P 500 up 1.2 percent and the Nasdaq Composite Index up 1.7 percent. Stocks also have booked solid gains for the year so far, with just five trading sessions left in 2012: The Dow has advanced 8 percent, while the S&P 500 has climbed 13.7 percent and the Nasdaq has jumped 16 percent. IT COULD GET A LITTLE CRAZY Equity volumes are expected to fall sharply next week. Last year, daily volume on each of the last five trading days dropped on average by about 49 percent, compared with the rest of 2011 - to just over 4 billion shares a day exchanging hands on the New York Stock Exchange, the Nasdaq and NYSE MKT in the final five sessions of the year from a 2011 daily average of 7.9 billion. If the trend repeats, low volumes could generate a spike in volatility as traders keep track of any advance in the cliff talks in Washington. "I'm guessing it's going to be a low volume week. There's not a whole lot other than the fiscal cliff that is going to continue to take the headlines," said Joe Bell, senior equity analyst at Schaeffer's Investment Research, in Cincinnati. "A lot of people already have a foot out the door, and with the possibility of some market-moving news, you get the possibility of increased volatility." Economic data would have to be way off the mark to move markets next week. But if the recent trend of better-than-expected economic data holds, stocks will have strong fundamental support that could prevent selling from getting overextended even as the fiscal cliff negotiations grind along. Small and mid-cap stocks have outperformed their larger peers in the last couple of months, indicating a shift in investor sentiment toward the U.S. economy. The S&P MidCap 400 Index overcame a technical level by confirming its close above 1,000 for a second week. "We view the outperformance of the mid-caps and the break of that level as a strong sign for the overall market," Schaeffer's Bell said. "Whenever you have flight to risk, it shows investors are beginning to have more of a risk appetite." Evidence of that shift could be a spike in shares in the defense sector, expected to take a hit as defense spending is a key component of the budget talks. The PHLX defense sector index hit a historic high on Thursday, and far outperformed the market on Friday with a dip of just 0.26 percent, while the three major U.S. stock indexes finished the day down about 1 percent. Following a half-day on Wall Street on Monday ahead of the Christmas holiday, Wednesday will bring the S&P/Case-Shiller Home Price Index. It is expected to show a ninth-straight month of gains. U.S. jobless claims on Thursday are seen roughly in line with the previous week's level, with the forecast at 360,000 new filings for unemployment insurance, compared with the previous week's 361,000.

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