New worries about problems in mortgage and housing markets and a continued decline in the dollar could hit stocks Thursday as investors look ahead to Friday's jobs report.
The Bank of England's rate-setting Monetary Policy Committee decides to keep interest rates at 5.25%. Source: BBC News | Business | World Edition | 6 Mar 2008 | 12:18 pm
FRANKFURT (Reuters) - The European Central Bank is expected to keep euro zone interest rates at 4 percent on Thursday, and will publish new economic forecasts which economists will scrutinize for guidance on future rate policy.
The Bank of England has held interest rates at 5.25pc today as fears of inflation take priority over concerns about the economic slowdown in the UK. Source: Telegraph Business | 6 Mar 2008 | 12:10 pm
AP - China faces growing pressure for prices to rise due to food shortages and a credit boom but is confident inflation can be held to its 4.8 percent target this year, financial officials said Thursday.
BP, the London-based oil giant, sent a notice to its shareholders Thursday disclosing the proposed settlement of a shareholder lawsuit in Alaska state court accused BP of mismanagement that led to a number of disasters.
The biggest, a blast at a Texas City, Texas, refinery killed 15 workers in 2005. BP proposed last week to pay $50 million to settle claims from that accident. In March and August of 2006, spills from the Trans-Alaska Pipeline resulted in partial shutdowns and criminal fines. Federal prosecutors have also accused BP traders of manipulating the market for propane gas.
Coughlin Stoia Geller Rudman & Robbins—the law firm founded by Wiliam S. Lerach, the Class Action King—filed the suit in October 2006 on behalf of the Unite Here union's pension fund and the London Pension Fund Authority.
The settlement requires BP to make several corporate governance changes, including:
Requiring them hold annual meetings with the company's Top 20 shareholders;
Arranging regular visits for BP board members to operational sites
Including BP's operational health, safety and environmental performance in the principles used to calculate performance pay to executives;
Improving shareholder access to the proxy, web cast the annual shareholder meeting.
BP also agreed that John Browne, the company's former chief executive, would permanently waive his rights to termination benefits that were frozen last year.
Under the settlement, which will be reviewed in court at a May 7 fairness hearing, Coughlin Stoia would receive $9.75 million in legal fees. Shareholders aren't in line to get any money.
"While corporate governance is for many people a remote subject, for the working families represented by the pension funds that brought this case and the residents in the communities that BP operates, changes like those agreed to by BP's management in this settlement can, over time, have a beneficial impact on the value of people's retirement savings and the quality of their communities," said Coughlin Stoia partner Patrick Coughlin.
BP fought the lawsuit, first pressing to get the case removed from state to federal court. That happened, but, alas, several BP executives, among them Lord John Browne of Madingley, BP's chief executive until May 2007, had connections to Alaska. The plaintiffs included Alaska residents, and that destroyed "diversity jurisdiction"—meaning a dispute between residents of two different states—a common ground for getting into federal court.
Back in state court, BP pressed to dismiss the case, saying that English common law applied to the case; under common law, a plaintiff can not bring a shareholder derivative case for wrongs done to a company when those acts or omissions could have been ratified by a majority of the shareholders.
In May 2007, Superior Court Judge Jack W. Smith of Anchorage denied the motion to dismiss, finding the law of Alaska applied to the lawsuit.
BP is the largest non U.S.-company listed on the stock exchange, according the plaintiffs' complaint.
The Bank of England has held interest rates at 5.25pc today as inflationary fears took priority over concerns about the economic slowdown in the UK. Source: Telegraph Business | 6 Mar 2008 | 11:59 am
Carlyle Capital Corp., an investment fund managed by the Washington private-equity firm Carlyle Group, said Thursday that it’s failed to meet margin calls from four counterparties and has already received one notice of default.
Reuters - Shares in Swiss bank UBS AG
fell on Thursday on speculation it had sold a huge portfolio of
risky mortgages at a deep discount and planned to announce
another massive writedown in the first quarter.
ZURICH (Reuters) - Shares in Swiss bank UBS AG fell on Thursday on speculation it had sold a huge portfolio of risky mortgages at a deep discount and planned to announce another massive writedown in the first quarter.
John Lewis, owner of the department stores and supermarket chain Waitrose, has
rewarded its staff its third largest ever annual bonus but expects the year
ahead to be "very challenging". Source: Latest Business News from Times Online | 6 Mar 2008 | 11:39 am
Reuters - A Dutch-listed affiliate of
private equity firm Carlyle Group has not been able to meet
some margin calls and has received a notice of default, it said
on Thursday. Source: Yahoo! News: Business | 6 Mar 2008 | 11:38 am
AMSTERDAM/LONDON (Reuters) - A Dutch-listed affiliate of private equity firm Carlyle Group has not been able to meet some margin calls and has received a notice of default, it said on Thursday.
It's been a rough couple of years for Bill Miller. His $16.5 billion mutual fund, Legg Mason Value Trust, just turned in its worst two-year performance relative to the S&P 500 since 1990, trailing the index by ten percentage points in 2006 and by 12 last year. That would be a poor stretch by any standard, but it's even worse by Miller's own: Until 2006 his value-oriented fund outperformed the index every calendar year for an astounding decade and a half (see "The Man Who's Beaten the Market 15 Years Running," Nov. 27, 2006).
British Airways today warned its profits for 2009 would be hit by soaring fuel
costs and a slowing economy, sending its shares down more than 4 per cent. Source: Latest Business News from Times Online | 6 Mar 2008 | 11:30 am
Reuters - Index futures pointed to a weaker open
on Thursday, with investors nervous ahead of data releases that
could provide clearer signals about whether the economy is in
recession.
LONDON (Reuters) - Index futures pointed to a weaker open on Thursday, with investors nervous ahead of data releases that could provide clearer signals about whether the economy is in recession.
U.S. stock futures drop as the dollar hits fresh lows against the euro and Swiss franc, while oil prices extend record highs to briefly top $105 a barrel.
British Airways Plc on Thursday said it would miss its long-term goal of a 10% operating-profit margin next year as rising fuel prices and a slowing global economy weigh on the bottom line.
LONDON (MarketWatch) -- Britain's top drug regulator on Thursday chided GlaxoSmithKline for not quickly releasing data on increased suicidal risk in patients under 18 who used its Seroxat antidepressant drug, but declined to press criminal charges.
Reuters - Google is expected to receive
unconditional approval from European Union regulators next week
for its $3.1 billion takeover of ad firm DoubleClick, people
familiar with the situation said.
BRUSSELS (Reuters) - Google is expected to receive unconditional approval from European Union regulators next week for its $3.1 billion takeover of ad firm DoubleClick, people familiar with the situation said.
PARIS (Reuters) - Natixis became the latest French bank to post a fourth-quarter loss on Thursday, battered by the credit crunch buffeting banks around the world.
The Bank of England today held interest rates at 5.25 per. Analysts forecast
that the Bank's Monetary Policy Committee, would be reluctant to cut rates
in the face of rising inflation. Source: Latest Business News from Times Online | 6 Mar 2008 | 11:05 am
Reuters - Carrefour unveiled a slight rise in 2007
profits and forecast faster growth in 2008 on Thursday while
speculation that a major shareholder may increase its stake
lifted shares in the world's No. 2 retailer.
Retail group John Lewis reports a near-20% rise in profits as partners receive bonuses totalling £181m. Source: BBC News | Business | World Edition | 6 Mar 2008 | 10:37 am
UK house prices declined by 0.3 per cent last month according to Halifax,
above the 0.2 per cent fall predicted by analysts and adding to evidence
that the UK housing market is losing momentum. Source: Latest Business News from Times Online | 6 Mar 2008 | 10:31 am
Carlyle Capital says it has not met payment demands from four creditors because of the credit crunch. Source: BBC News | Business | World Edition | 6 Mar 2008 | 10:30 am
At 9.25am this morning 68,000 John Lewis and Waitrose staff from Eastbourne to Aberdeen will crowd around their stores to learn the size of their annual bonus. Source: Telegraph Business | 6 Mar 2008 | 10:30 am
High-profile former Wall Street CEOs and the head of the nation's largest home lender will testify before a Congressional committee examining the link between executive pay and the mortgage crisis.
Bond insurer Ambac confirms a plan to save its top credit rating to prevent the company breaking up. Source: BBC News | Business | World Edition | 6 Mar 2008 | 10:05 am
Asian indexes rebounded Thursday, with Japanese stocks bouncing back on gains for exporters such as Nintendo Co. and Honda Motor Co. after an advance on Wall Street, while Hong Kong stocks snapped a four-day losing streak on resource issues such as Cnooc and Aluminum Corp. of China.
The euro pressed again to a new high against the dollar, but Jean-Claude Trichet will be in the spotlight Thursday as currency markets ponder whether the European Central Bank president will use his monthly news conference to attempt to arrest the rise of the European currency, said foreign-exchange strategists.
It's no exaggeration to say that a large chunk of my early winter was wasted trying to buy a wide-screen TV. After finishing my basement with the explicit goal of turning an empty concrete space into a Wii-playing, movie-watching, comfy-couch-laden rec room, I knew that the TV had to be really big and really flat, with good but not top-of-the-line picture and features. Easy enough.
UK house prices are continuing to slow down, says the Halifax, the country's biggest mortgage lender. Source: BBC News | Business | World Edition | 6 Mar 2008 | 9:27 am
After the minor falls on Tuesday, the commodities markets went into overdrive yesterday with oil, gold, corn, silver etc all recording record highs. Source: Telegraph Business | 6 Mar 2008 | 9:22 am
SVG, the fund-of-funds which invests most of its money in Permira, the British
private equity group, said profits fell as it suffered more than £66 million
of writedowns, but overall its net asset value grew by 14.3 per cent to
974.3p last year. Source: Latest Business News from Times Online | 6 Mar 2008 | 9:18 am
British Airways warns high fuel bills, economic slowdown and Heathrow's Terminal 5 costs will hit its earnings. Source: BBC News | Business | World Edition | 6 Mar 2008 | 9:14 am
Reuters - H&R Block Inc , the tax
preparer trying to recover from losses at a subprime mortgage
unit, posted a quarterly loss on Wednesday, due to discontinued
operations and staff reduction expenses.
NEW YORK (Reuters) - H&R Block Inc , the tax preparer trying to recover from losses at a subprime mortgage unit, posted a quarterly loss on Wednesday, due to discontinued operations and staff reduction expenses.
NEW YORK (Reuters) - Merrill Lynch & Co on Wednesday said it will eliminate 650 jobs as it stops making subprime mortgages through its First Franklin Financial Corp unit.
India's largest IT outsourcing company has been hit by two large contract
cancellations from Wall Street banks in the latest sign that the sub-prime
crisis is weighing on the world economy. Source: Latest Business News from Times Online | 6 Mar 2008 | 8:40 am
Taylor Wimpey, the UK's second largest housebuilder, has revealed a £19.5m loss after its US business took a hammering from falling land values and house prices. Source: Telegraph Business | 6 Mar 2008 | 8:40 am
The dollar hits another low against the euro on continued worries about the health of the US economy. Source: BBC News | Business | World Edition | 6 Mar 2008 | 8:37 am
Gazprom said it would resume full supplies of gas to Ukraine, and Naftogaz, the Ukrainian national energy company, said it would settle a $600 million debt. Source: Infocious RSS raw feed - channel BNPaperBusiness | 6 Mar 2008 | 8:37 am
The airline expects profits to fall sharply in the next financial year as a result of the surge in oil prices and the economic slowdown, and the costs of moving to Heathrow's new Terminal 5 Source: FT.com - US homepage | 6 Mar 2008 | 8:35 am
A third of Britons are "financial fantasists" who do not worry about their monetary situation because they believe they will be earning more in the future and can borrow to fill any gaps, a new survey has found. Source: Telegraph Business | 6 Mar 2008 | 8:31 am
Troubled bond insurer Ambac is to raise at least $1.5bn (£752m) in an attempt to bolster its capital after sustaining $3.2bn of largely sub-prime related losses last year. Source: Telegraph Business | 6 Mar 2008 | 8:15 am
Reuters has seen a 13 per cent fall in pre-tax profits as it announced its
final full-year results as a standalone company. Source: Latest Business News from Times Online | 6 Mar 2008 | 8:13 am
PARIS (Reuters) - Carrefour , the world's No. 2 retailer, said on Thursday it aimed to return around 4.5 billion euros ($6.88 billion) to investors in coming years as it reported slightly higher 2007 profits and faster growth in 2008.
AP - Japanese stocks rebounded Thursday, lifted by gains in regional markets and talk that U.S. lawmakers are mulling a bill to help ease the home loan crisis. Source: Yahoo! News: Business | 6 Mar 2008 | 8:07 am
With inventories of new homes sitting vacant and previous incentives falling flat, price cuts appear to be luring buyers out of hiding.
As the housing slump worsened last fall, Don Dale struggled to find buyers for the $900,000 houses he was selling for Shea Homes in the hills of Aliso Viejo. Then in January, Shea slashed prices to about $750,000. Dale sold nine in one day.
Dow rises 120 points, then retreats to a gain of 41 on mixed data. A Fed report shows sluggish conditions.
The stock market managed a moderate gain Wednesday despite a downbeat assessment of the economy by the Federal Reserve and disappointment about a plan to pump capital into a troubled bond insurer.
The ex-fund wizard took nearly $16,000 worth of tickets from brokers seeking business, regulators say. The contrite executive agrees to pay for the value of the gifts, plus interest.
In a case that could sully the reputation of legendary Fidelity Investments fund manager Peter Lynch, regulators said Wednesday that he had improperly accepted almost $16,000 worth of free sports, concert and theater tickets from brokers seeking the mutual fund giant's business.
Sales of Jill Gaynor's teaching products rose after toy scares
Finding words and counting numbers in Jill Gaynor's educational games are pretty simple tasks. ¶ Producing the games is more complicated. Gaynor, a 37-year-old educator-turned-entrepreneur, demands that her board games for ages 4 and up be printed with soy ink, on recycled paper, laminated with phthalate-free material and finished with a nontoxic, water-based varnish. ¶ "The same chemicals that are toxic for children are also harmful for the environment," said Gaynor, an avid environmentalist who boasts of the organic carpet in her West Los Angeles office. "And when harmful things are released into the environment that hurts children." ¶ Gaynor's fledgling business, Beyond Learning, makes eco-friendly games designed for young children to familiarize themselves with basic words and counting while moving game pieces across a colorfully illustrated board.
Dear Karen: I'm setting up my corporation. How do my partner and I issue stock, register our corporate name and establish our charter? Source: Infocious RSS raw feed - channel BNPaperBusiness | 6 Mar 2008 | 8:00 am
NEW YORK -- Warren Buffett, the famed U.S. investor who heads Berkshire Hathaway Inc. , replaced his friend and Microsoft Corp. founder Bill Gates as the richest man in the world, Forbes magazine said today.
NEW YORK -- Warren Buffett, the famed U.S. investor who heads Berkshire Hathaway Inc. , replaced his friend and Microsoft Corp. founder Bill Gates as the richest man in the world, Forbes magazine... Source: Infocious RSS raw feed - channel BNPaperBusiness | 6 Mar 2008 | 8:00 am
House members say that the $40-billion contract will result in lost U.S. jobs.
Members of a House subcommittee grilled Air Force officials today over the surprise decision to award a $40-billion aircraft contract to Northrop Grumman Corp. and European partner Airbus, with lawmakers arguing the decision would send coveted jobs overseas.
With inventories of new homes sitting vacant and previous incentives falling flat, price cuts appear to be luring buyers out of hiding. ... Source: Infocious RSS raw feed - channel BNPaperBusiness | 6 Mar 2008 | 8:00 am
UnitedHealth is rated worst of the bunch in a a survey of executives.
The nation's biggest health insurers lately have taken to rating hospitals on quality and cost, saying the information can help patients make better choices.
The plan by the ailing bond insurer to save its credit rating falls short of Wall Street expectations.
Troubled bond insurer Ambac Financial Group Inc. said Wednesday that it would raise $1.5 billion in capital by selling shares in an effort to preserve its all-important credit rating, but the plan disappointed Wall Street and its stock price tumbled.
News and information group Reuters reports a drop in pre-tax profits, but says the 2008 outlook is encouraging. Source: BBC News | Business | World Edition | 6 Mar 2008 | 7:33 am
The pound slid close to an all-time low against the euro amid growing despondency about the health of the UK economy. Source: Telegraph Business | 6 Mar 2008 | 7:30 am
Deutsche Post reports a 61% slump in quarterly profits after problems at its US business DHL Express. Source: BBC News | Business | World Edition | 6 Mar 2008 | 7:20 am
NEW YORK (Reuters) - U.S. aviation regulators are seeking a penalty of at least $3 million from Southwest Airlines Co for failing properly to inspect more than 40 older planes for structural cracks, the Wall Street Journal reported on Thursday, citing people familiar with the details.
There's a tornado heading toward the distressed market, and Carl Icahn plans to hide while he waits to see if it will pass.
The activist investor and wannabe blogger spoke at the Buyouts East conference yesterday about his economic outlook, investment opportunities, and, of course, his disdain of corporate boards.
The tornado is Icahn's metaphor for the continued fallout from the credit crisis. There's no doubt that more is coming, he says. The tornado could destroy everything in its path or lose steam before it arrives, but until he knows for sure, he's steering clear of the distressed market. Once it passes, he says, there will be plenty of opportunities.
Icahn, who says he believes the economy is currently in a recession, took advantage of the distressed market during the economic slowdowns in the early 1990s and again after the technology bubble burst. "Today, it's worse," he said. "I would be very, very careful buying distressed right now."
The one place he says he does see value in that market is in bank debt, although he says he's not currently buying any. "Nobody really can pick the bottom of the market," he said. "But I have never seen it this bad in the banking area."
Count on Icahn to take advantage of the distressed market once he's certain the storm has passed. He believes bankruptcies will be "a huge growth industry for the next few years."
He doesn't know when the economy will rebound, but he's worried that if the situation persists, Americans will elect a Democrat in November. "Hopefully they won't go wild [with regulation]," he said. Needless to say, he'll be pulling the lever for McCain.
Icahn, who is currently fighting for board seats at Motorola, used plenty of his time to skewer the bad habits of board members, as he is so famous for doing. Asked to put odds on his nominees being accepted to Motorola's board at May's shareholder meeting, Icahn hedged. "Sometimes the best way to win the war is not to fight it," he said, curiously.
Perhaps he has forgotten that he's been at the front lines of that war for many months now. In a regulatory filing just yesterday, Icahn disclosed his stake in the company increased to 6.3 percent from 5 percent.
And what about that question that's burning on so many minds: When will Icahn start blogging? Earlier this year he told a reporter that he plans to launch a blog on Icahnreport.com. But the site has been teasing visitors with a "coming soon" notice ever since.
"I'm gonna do it," he said yesterday. "It's been a little bit of a problem with the lawyers. Every night I write for about an hour and the next day they rip it up."
Home owners, particularly those with mortgages, can look forward to more pain.
Reserve Bank governor Alan Bollard surprised no one today when he left the Official Cash Rate (OCR) unchanged on 8.25 per cent in the bank's quarterly... Source: New Zealand Herald - Business | 6 Mar 2008 | 3:00 am
US growth slowed in the six weeks to February 25, the Federal Reserve's beige book survey said, even as a better-than-expected services report raised hope that the economy might yet avoid recession Source: FT.com - US homepage | 6 Mar 2008 | 2:01 am
Robert Gates, US defence secretary, defended the air force's decision to award a $35bn deal for refuelling tankers to EADS, the European defence contractor, over Boeing Source: FT.com - US homepage | 6 Mar 2008 | 1:39 am
General Motors has again come to the rescue of Delphi, the bankrupt parts maker, by offering to provide up to $2.8bn in loans to facilitate Delphi's emergence from Chapter 11 protection Source: FT.com - US homepage | 6 Mar 2008 | 1:11 am
Ambac, the troubled bond insurer, lost nearly a fifth of its stock market value after revealing a $1.5bn recapitalisation plan that disappointed investors hoping for a bigger rescue effort Source: FT.com - US homepage | 6 Mar 2008 | 1:03 am
The Securities and Exchange Commission charged Peter Lynch, the legendary fund manager, and 13 current or former Fidelity Investments employees with improperly accepting more than $1.6m in gifts from outside brokers Source: FT.com - US homepage | 6 Mar 2008 | 12:37 am
Businesses who struggle to meet their provisional tax payments during their 'slow season' may be in for some respite.
From the start of the next tax year, Inland Revenue will introduce a new and optional way for businesses to calculate... Source: New Zealand Herald - Business | 6 Mar 2008 | 12:30 am
Sanctuary, the troubled music group that started life managing Iron Maiden, has been bought by Universal Music, the world's biggest record company, in a £44.5m deal. Source: Telegraph Business | 6 Mar 2008 | 12:05 am
Wen Jiabao, the Chinese Prime Minister, used his annual state of the nation
speech yesterday to set out how Beijing would try to prevent rising prices
emerging as a focus for social unrest. Source: Latest Business News from Times Online | 6 Mar 2008 | 12:00 am
Unilever, the Persil and Lipton Tea consumer goods giant, has begun the
process of recruiting a replacement for Patrick Cescau, its 59-year-old
chief executive, <i>The Times</i> has learnt. Source: Latest Business News from Times Online | 6 Mar 2008 | 12:00 am
Long-suffering shareholders in FKI could spend hours running the numbers on
yesterday’s £500 million approach from Melrose, its smaller rival. Source: Latest Business News from Times Online | 6 Mar 2008 | 12:00 am
Highland Capital Management, a Texas fund manager that became one of the world's largest and most feared investors in corporate debt, is being forced to fight a multi-front battle to ensure that it does not become a victim of the sliding value of its holdings Source: FT.com - US homepage | 6 Mar 2008 | 12:00 am
The sharemarket drifted lower in early trading today despite a mildly positive session on Wall Street.
The NZSX-50, which yesterday rose 0.9 per cent, was down 7 points to 3612 at 10.15am.
Turnover was strong at nearly $50 million... Source: New Zealand Herald - Business | 5 Mar 2008 | 11:55 pm
The Auckland property market continues to stutter to a halt.
The market kept its slower pace in February with just over 600 sales, down a third on the same month last year, according to data released by Barfoot & Thompson today.
Fewer... Source: New Zealand Herald - Business | 5 Mar 2008 | 11:00 pm
One of the most storied investors of modern times has been tarnished by allegations that he took gifts by outside brokers seeking the huge trading business that the mutual fund giant Fidelity Investments generates.
The Securities and Exchange Commission says that Peter Lynch, who ran Fidelity's flagship fund Magellan in the 1980's, accepted nearly $16,000 in tickets, including tickets to a U2 concert and passes to the Ryder golf tournament, from brokers from 1999 to 2004. Lynch was a vice chairman and director of Fidelity at the time.
Lynch was celebrated for his aggressive stock picking at Magellan from 1977 to 1990, reporting returns that beat the market year after year.
The S.E.C. said 12 other current or former employees of Fidelity accepted more than $1.6 million in travel, entertainment, and other gifts that were paid for by brokers.
"The broker selection process on Fidelity's equity trading desk was compromised when gifts and lavish entertainment swayed the flow of brokerage business," said Walter Ricciardi, Deputy Director of the commision's division of enforcement. "This misconduct created a serious risk of investor harm and violated Fidelity's duty of allegiance and loyalty to investors."
Fidelity has agreed to pay a $8 million civil penalty to settle the allegations but did not admit nor deny any wrongdoing.
"We do recognize the seriousness of the misconduct found by the S.E.C," Fidelity said in a statement.
Lynch agreed to pay $15,948 in disgorgement and $4,183 in interest to settle with the S.E.C.
The Government's accounts have dropped into an operating deficit for the first time in almost 15 years as investments like the New Zealand Superannuation Fund feel the effects of weak global markets, and as tax revenues fall short... Source: New Zealand Herald - Business | 5 Mar 2008 | 9:00 pm
Oil reached a new all time record price today of US$1.04 a barrel.
US crude futures climbed to a record peak of US$104.56 earlier in the session.
By 1715 GMT, the front-month contract traded up US$4.69 at US$104.21 a barrel.
London... Source: New Zealand Herald - Business | 5 Mar 2008 | 8:45 pm
Reserve Bank governor Alan Bollard is walking a tightrope in a stiff breeze , trying to balance the risks of even higher inflation on the one side against the Source: New Zealand Herald - Business | 5 Mar 2008 | 8:30 pm
The first of the Auckland apartments owned by investors in troubled Blue Chip has hit the market, causing misery for its owners.
City Sales auctioned three inner-city units yesterday and managing director Martin Dunn said the first... Source: New Zealand Herald - Business | 5 Mar 2008 | 8:15 pm
Auckland International Airport shares staged a minor rally yesterday before closing up just a cent after this week's wipe-out.
The shares finished at $2.25 after being up 10c at one stage on Tuesday's close when more than $300... Source: New Zealand Herald - Business | 5 Mar 2008 | 8:00 pm
The long awaited plan to revive bond insurer Ambac Financial Group has been announced, and investors are not happy.
Shares of Ambac are down 13 percent in afternoon trading after the company said it would it would raise at least $1.5 billion in new capital by selling common stock and equity units.
Ambac is trying to boost its reserves to maintain its triple-A rating. Standard & Poor's said that the new capital would probably be sufficient.
"This capital raise, along with our recent strategic actions, our increased emphasis on risk-adjusted returns over the course of an economic cycle and a six-month suspension of the structured finance business, will strengthen our capital base,” said Michael Callen, chief executive of Ambac.
But investors were clearly expecting a much larger capital-raising effort.
"It's too little, too late," said Kevin Giddis, head of fixed-income trading at Morgan Keegan, told Bloomberg News. "I think the market expected more substance.''
Ambac, the No. 2 bond insurer after MBIA, is also getting out of the structured finance businesses that got it in trouble in the first place.
Charles Gasparino on CNBC reports that New York state insurance regulators say that both MBIA and Ambac have enough assets to cover losses stemming from guarantees on credit derivatives.
Washington attacked Opec for its refusal to increase oil production after an unexpected drop in US crude oil inventories pushed prices to a record high Source: FT.com - US homepage | 5 Mar 2008 | 7:43 pm
It's been a long journey, but entrepreneur Alan Gibbs hopes the first of his amphibious vehicles will be sold by the end of next year.
Since the high-profile launch of the Aquada - a sports car that can also reach speeds of up... Source: New Zealand Herald - Business | 5 Mar 2008 | 7:00 pm
Cross-border violence in and around Israel's Gaza Strip makes it difficult for both Israeli and Palestinian business owners to keep their doors open. Daniel Estrin reports how Israeli shop owners are coping. Source: Marketplace | 5 Mar 2008 | 6:55 pm
Commentator David Frum says that instead of repeating mistakes in response to economic slowdowns and high oil prices, we should be trying new solutions. Source: Marketplace | 5 Mar 2008 | 6:55 pm
Chinese Premier Wen Jiabao pledged to fight inflation and government bureaucracy, which have been pushing the cost of living up for the Chinese working class. Bob Moon reports on whether his words will result in real reforms. Source: Marketplace | 5 Mar 2008 | 6:55 pm
Xerox has unveiled its new brand logo on racing superbikes as part of a multimillion-dollar rebranding campaign. But how much can a new logo really convey? Jennifer Collins reports. Source: Marketplace | 5 Mar 2008 | 6:55 pm
Wal-Mart, one of the biggest corporate charitable donors in the U.S., is changing the focus of its philanthropic efforts to target education, job training and health care. Tess Vigeland speaks with Margaret McKenna, President of the Wal-Mart Foundation. Source: Marketplace | 5 Mar 2008 | 6:55 pm
According to a study published by the Journal of the American Medical Association, more expensive medications relieve pain better, even when they're placebos. Jeff Tyler reports sometimes perception is reality. Source: Marketplace | 5 Mar 2008 | 6:55 pm
As the credit crunch continues, many businesses have to file for bankruptcy. That means that one area of business is booming: bankruptcy services firms. John Dimsdale reports on how they are staffing up. Source: Marketplace | 5 Mar 2008 | 6:55 pm
Brazil's JBS, the world's biggest beef producer, is looking to buy two U.S. beef companies: Smithfield Beef Group and National Beef Packing Co. The move would make the Brazilian company the largest beef producer in America. Dan Grech reports. Source: Marketplace | 5 Mar 2008 | 6:54 pm
You won't find Oprah Winfrey on the list. Nor will you find the legion of hedge fund managers who routinely collect hundreds of millions in any given year. That's because they're all just getting paid to do their day jobs.
This list, compiled by Vanity Fair, ranks the winners from last year's monster transactions: Stock cash-outs, I.P.O.'s, sales of companies, real-estate deals—even inheritances.
Here are the Top 5 of the 50 players (and one lucky canine) whose bottom lines got the biggest boost last year.
The world's richest man downloaded $2.5 billion worth of Microsoft stock last year. Throw in a few hundred million dollars in dividend income and his impending retirement will be all the more comfortable.
Seven years after selling Times Mirror (publisher of the Los Angeles Times) to Tribune Co. for stock, the forlorn newspaper clan pushed for the sale of Tribune to investor Sam Zell - this time for cash.
In March, the TV veteran (he was partners with All in the Family producer Norman Lear) said adios to Univision, the nation's largest Spanish-language broadcaster, for $13.7 billion.
Like a battle-hardened warrior, Barry Diller can envision defeat as well as victory.
As he prepares to fight John Malone's Liberty Media in court next week, Diller, for the first time, acknowledged that he may lose control of the internet conglomerate he has built, IAC/Interactive.
At an event co-hosted by Variety, Diller conceded that much was riding on the outcome in court.
Diller, taking note of his and Malone's reputations for being tough, hands-on managers, said, Varietyreported: "It's very odd that two people who don't want to give up control of anything are giving control to a judge in Delaware."
"The wonderful thing about Delaware is they do it quickly," Diller added. "They make a decision quickly."
Malone and Diller clashed over Diller's plan to break up IAC into five separate units.
The plan, first proposed in November, would shrink Liberty's voting power in the spinoff companies roughly by half. Liberty currently owns about 30 percent of IAC but has some 62 percent of the voting rights.
Malone has since moved to replace seven IAC board members, including Diller; his wife, designer Diane Von Furstenberg; Edgar Bronfman Jr.; and Steven Rattner. Diller has called Liberty's arguments "insane."
Few expect a settlement before a trial gets underway in Delaware Chancery Court on March 10 or 11.
And if Diller loses, he is prepared to walk out the door.
As he told Lloyd Grove in an interview last year: "What I don't want to do, and I think I'm incapable of doing is, quote, 'hanging on.'"
Whatever happened to the takeover battle between Microsoft and Yahoo?
After days without any leaks, spin, or rumors about possible white knights, an answer has emerged: not much.
Yahoo is still maneuvering, and Microsoft is still holding firm, mindful of a deadline next week for it to mount a proxy contest.
As a result, reports Andrew Ross Sorkin in the New York Times, Yahoo is considering pushing back the date of its annual shareholders meeting (and the deadline for a proxy challenge) to give it more time to come up with an alternative or to negotiate a friendly deal with Microsoft, while not being completely under the gun.
(Yahoo has now confirmed that it will extend the deadline for nominating directors to its board from March 14 to 10 days following the public announcement of the date for its annual shareholder meeting. That date has not yet been set.)
Yahoo can't take too much time. Under the laws of Delaware, where Yahoo is incorporated, the company has to have an annual meeting before July 13. And Yahoo already faces several shareholder lawsuits brought by investors who are pressing the company to negotiate with Microsoft.
Since Microsoft publicly disclosed its unsolicited offer of $31 per share on February 1, "everybody and their mother has looked at ways to scuttle" the deal, says Erick Schonfeld of TechCrunch. He reports that Rupert Murdoch's News Corp., after weeks of negotiations with Yahoo, late last week made a number of proposals, "including ones involving Google, private equity funds, and even one scenario involving Microsoft as a search-advertising partner."
Another alternative being weighed involves AOL. Kevin Delaney and Merissa Marr of the Wall Street Journalreport that Yahoo has stepped up negotiations with Time Warner over folding AOL into Yahoo. Such a merger, which would include AOL's Advertising.com, would create an online advertising powerhouse, they note.
Henry Blodget on Silicon Alley Insider contends that such a deal makes a lot of sense, helping Yahoo become a real online advertising alternative to Google. A merger would increase their share of search, and there are better fits (AOL brands like Mapquest on Yahoo; Yahoo mail replacing AOL's "ghastly email system") than there are with Microsoft.
Blodget, however, acknowledges that such a merger is unlikely to happen. He, as well as virtually every other analyst and commentator, says that a Microsoft takeover is inevitable. The talks on alternative deals will only help Yahoo extract a few more dollars from Microsoft.
AP - China faces growing pressure for prices to rise due to food shortages and a credit boom but is confident inflation can be held to its 4.8 percent target this year, financial officials said Thursday.
Reuters - Shares in Swiss bank UBS AG
fell on Thursday on speculation it had sold a huge portfolio of
risky mortgages at a deep discount and planned to announce
another massive writedown in the first quarter.
Reuters - Index futures pointed to a weaker open
on Thursday, with investors nervous ahead of data releases that
could provide clearer signals about whether the economy is in
recession.
Reuters - Google is expected to receive
unconditional approval from European Union regulators next week
for its $3.1 billion takeover of ad firm DoubleClick, people
familiar with the situation said.
Reuters - Carrefour unveiled a slight rise in 2007
profits and forecast faster growth in 2008 on Thursday while
speculation that a major shareholder may increase its stake
lifted shares in the world's No. 2 retailer.
Reuters - H&R Block Inc , the tax
preparer trying to recover from losses at a subprime mortgage
unit, posted a quarterly loss on Wednesday, due to discontinued
operations and staff reduction expenses.