Reuters - The Dow and S&P 500 stock indexes
opened higher on Thursday after U.S. fourth-quarter economic
growth data met Wall Street's expectations and weekly jobless
claims fell.
NEW YORK (Reuters) - The Dow and S&P 500 stock indexes opened higher on Thursday after U.S. fourth-quarter economic growth data met Wall Street's expectations and weekly jobless claims fell.
Reuters - ConAgra Foods Inc on Thursday said it
would sell its commodity trading and merchandising operations
in a deal valued at $2.1 billion, allowing it to focus on its
core food business and to repurchase shares.
Clear Channel Communications said Thursday a judge has barred a group of banks from pulling out of funding for a 19.5-billion-dollar private equity buyout of the big radio station operator. Source: Infocious RSS raw feed - channel BNewsBusiness | 27 Mar 2008 | 1:37 pm
CHICAGO (Reuters) - ConAgra Foods Inc on Thursday said it would sell its commodity trading and merchandising operations in a deal valued at $2.1 billion, allowing it to focus on its core food business and to repurchase shares.
Stocks are mostly higher following an economic report that showed personal spending rose more than expected during the fourth quarter. Investors are also upbeat about a drop in the... Source: Infocious RSS raw feed - channel BNewsBusiness | 27 Mar 2008 | 1:36 pm
(Reuters) - Sanford C. Bernstein expects Merrill Lynch & Co to post a loss in the first quarter instead of of its previous forecast for a profit, citing $4.5 billion in total... Source: Infocious RSS raw feed - channel BNewsBusiness | 27 Mar 2008 | 1:35 pm
(Reuters) - Sanford C. Bernstein expects Merrill Lynch & Co to post a loss in the first quarter instead of of its previous forecast for a profit, citing $4.5 billion in total writedowns at the U.S. bank.
WASHINGTON (Reuters) - U.S. corporate profits fell 3.3 percent in the fourth quarter of 2007, according to government data on Wednesday that also confirmed U.S. economic growth slowed to a... Source: Infocious RSS raw feed - channel BNewsBusiness | 27 Mar 2008 | 1:33 pm
WASHINGTON (Reuters) - U.S. corporate profits fell 3.3 percent in the fourth quarter of 2007, according to government data on Wednesday that also confirmed U.S. economic growth slowed to a meager annual pace of 0.6 percent in same period.
Flights began taking off and landing at Heathrow airport's new terminal on Thursday, although not without a few reported teething problems at the London air hub. Terminal... Source: Infocious RSS raw feed - channel BNewsBusiness | 27 Mar 2008 | 1:30 pm
Italy faces pressure from the EU to provide information on the contamination of mozzarella. Source: BBC News | Business | World Edition | 27 Mar 2008 | 1:28 pm
American Airlines and Delta Air Lines canceled dozens of flights Thursday as they continue their inspections of wiring bundles on some of their planes.
NEW YORK (Reuters) - Lennar Corp reported a quarterly loss on Thursday as deliveries of new homes and new orders tumbled, but shares of the No. 2 U.S. home builder rose because the results were not as bad as analysts had expected.
AP - Asia faces a sharp rise in food costs, due partly to surging demand for crops used in biofuels, and governments should do more to shield the region's poor from economic shocks, a U.N. commission said Thursday. Source: Yahoo! News: Business | 27 Mar 2008 | 1:18 pm
Wall Street stocks were set to rebound at the opening on Thursday as investors took heart from slightly better than expected data on employment and growth that softened recent indications of a parlous US economy. Source: FT.com - US homepage | 27 Mar 2008 | 1:15 pm
Reuters - Upscale home goods retailer
Williams-Sonoma Inc on Thursday posted a higher
quarterly profit but gave a cautious outlook for the current
fiscal year, citing a challenging economic backdrop. Source: Yahoo! News: Business | 27 Mar 2008 | 1:11 pm
NEW YORK (Reuters) - Upscale home goods retailer Williams-Sonoma Inc on Thursday posted a higher quarterly profit but gave a cautious outlook for the current fiscal year, citing a challenging economic backdrop.
Pakistan must take immediate action to prevent its economy from collapse, the World Bank warns. Source: BBC News | Business | World Edition | 27 Mar 2008 | 1:10 pm
The French state-run postal service, La Poste, reported on Thursday a net profit of nearly a billion euros (1.5 billion dollars) and said it would pay a profit-sharing bonus to its... Source: Infocious RSS raw feed - channel BNewsBusiness | 27 Mar 2008 | 1:06 pm
Oil prices jumped above 107 dollars a barrel on Thursday when concern about tight supplies increased on news that saboteurs had blown up a major Iraqi export pipeline, traders said. Source: Infocious RSS raw feed - channel BNewsBusiness | 27 Mar 2008 | 1:02 pm
ConAgra Foods Inc. said Thursday its third-quarter profit soared 60 percent as it raised prices and improved sales. The year-ago results were depressed by recall costs, however. ... Source: Infocious RSS raw feed - channel BNewsBusiness | 27 Mar 2008 | 12:59 pm
WASHINGTON (Reuters) - The number of U.S. workers filing new claims for jobless benefits fell by 9,000 last week, the government said on Thursday, though a more reliable gauge of layoff trends rose to its highest in more than two years.
Clear Channel Communications Inc. said Thursday that a Texas judge has issued an order barring banks from taking steps that would "interfere or thwart" the closing of the proposed $19.5... Source: Infocious RSS raw feed - channel BNewsBusiness | 27 Mar 2008 | 12:49 pm
Shares in Edinburgh-based iPod chip maker Wolfson fall 30% after it loses a major supply contract. Source: BBC News | Business | World Edition | 27 Mar 2008 | 12:48 pm
The economy nearly sputtered out in the final quarter of last year and is probably faring even worse now amid the continuing housing, credit and financial crises. The Commerce... Source: Infocious RSS raw feed - channel BNewsBusiness | 27 Mar 2008 | 12:44 pm
A Texas judge ordered banks to fund the proposed $19 billion buyout of Clear Channel Communications by two private-equity firms, the San Antonio radio broadcaster said in a statement on Thursday.
The simmering political tensions in Tibet burst into the open in one of Lhasa's most important temples when a group of 30 young Buddhist monks interrupted a government-organised visit by journalists Source: FT.com - US homepage | 27 Mar 2008 | 12:39 pm
Man Group, the world’s largest listed hedge fund manager, said Thursday that it expects to beat earnings forecasts after achieving strong growth in performance fees at its AHL futures fund.
General Electric reached separate deals with American Express and Banco Santander, getting $1.1 billion in cash and an Italian banking operation in return for selling its corporate card business and various European personal finance units.
Reuters - U.S. corporate profits fell 3.3
percent in the fourth quarter of 2007, the Commerce Department
said on Thursday in a report that also confirmed U.S. economic
growth slowed to a meager annual pace of 0.6 percent in same
period.
Shares in Scottish microchip maker Wolfson Microelectronics tumbled on Thursday as the company said its products won’t be used in the new portable music players from a major customer believed to be Apple Inc.
Council tax bills in England will go up by an average of 4% in the next financial year. Source: BBC News | Business | World Edition | 27 Mar 2008 | 12:20 pm
WASHINGTON (MarketWatch) -- Sybase Inc., a maker of business software, said Thursday it will exceed its prior goals for first-quarter sales and profit.
Does Harvard Business School have a future? Its storied past will get extra attention when the school turns 100 years old on April 8. But in a fast-changing global economy, the world's iconic business school faces new threats of the type that confront all established institutions.
SAN FRANCISCO (Reuters) - Auditor KPMG either initiated accounting fraud at New Century Financial Corp or stood idly by as the failed subprime mortgage lender committed fraud in 2005 and 2006, an independent report requested by the U.S. Department of Justice shows.
Airbus ends talks to sell three factories in Germany to a German consortium, blaming the strong euro. Source: BBC News | Business | World Edition | 27 Mar 2008 | 11:56 am
LONDON (Reuters) - Man Group, the world's biggest listed hedge fund firm, said on Thursday it would beat analysts' average profit forecast for the year ended March 31 despite turmoil in financial markets.
A strike by Argentine farmers over rising export taxes heads into a third week, with little sign of resolution. Source: BBC News | Business | World Edition | 27 Mar 2008 | 11:31 am
The fight over a $19 billion buyout of radio chain Clear Channel Communications may have just started—but it has already drawn blood.
Clear Channel says it has won a temporary restraining order from a Texas judge against the banks that had agreed to finance the deal, requiring them not to interfere with the buyout by refusing to fund it or demanding new terms.
Six banks—Citigroup, Morgan Stanley, Credit Suisse, the Royal Bank of Scotland, Deutsche Bank, and Wachovia—had made commitments for more than $22 billion of financing for the buyout by Bain Capital and Thomas H. Lee Partners. But the market for deal debt has eroded.
The company said that Judge John Gabriel of the state district court in Bexar County, Texas, found on Wednesday night in favor of its claim that "irreparable harm would result if the banks were not immediately enjoined from tortiously interfering with the merger agreement."
The banks have not yet responded to the judge's order.
On Wednesday, both Clear Channel and the two buyout firms sued the banks in New York and Texas courts.
"The financial risk to the banks in this suit dwarfs any risk they think they have in funding the debt," saidMark Mays, chief executive of Clear Channel Communications. "The behavior of these banks is irresponsible, unprofessional, and unjustified."
The firms say that the banks have tried to renege on the commitments they made nearly a year ago. "It seems clear that lenders' remorse set in when credit markets worsened," the firms said in a statement. "Now they are trying to walk away from their commitment letter which clearly states that they bear all the risk that conditions in the debt markets might change."
The deal, first announced in November 2006, is now for $39.20 per share. On Wednesday, Clear Channel shares tumbled 17 percent, to $26.92, amid reports that the buyout was collapsing.
The question is whether the legal squaring off is all for show—a prelude to a renegotiated buyout at a lower price.
Steven Davidoff, the deal professor on DealBook, points out that the plaintiffs in the Texas lawsuit have brought in a big gun: Joe Jamail, the lawyer who in 1985 won a $10.5 billion verdict against Texaco for interfering with a deal between Pennzoil and Getty.
Mortgage approvals for homebuyers are still close to the lowest levels on record, according to latest figures from the British Bankers' Association. Source: Telegraph Business | 27 Mar 2008 | 11:30 am
Mortgage approvals for homebuyers are still close to the lowest levels on record, according to latest figures from the British Bankers' Association. Source: Infocious RSS raw feed - channel BNPaperBusiness | 27 Mar 2008 | 11:30 am
Oil prices rise above $107 after one of Iraq's main export pipelines is blown up, sparking supply fears. Source: BBC News | Business | World Edition | 27 Mar 2008 | 11:29 am
Reuters - Merrill Lynch & Co and UBS AG
may lose money this quarter and suffer write-downs of
$6 billion and $11.1 billion, respectively, as credit problems
worsen, according to Oppenheimer & Co analyst Meredith Whitney.
When the Washington Nationals play their home opener against the Atlanta Braves on Sunday, the grass on the field won't be the only thing that's green.
German consumer confidence is improving slightly, but inflation remains a concern, a report says. Source: BBC News | Business | World Edition | 27 Mar 2008 | 11:00 am
Bank mortgage lending to people who are moving home is still down by a third on the same time a year ago. Source: BBC News | Business | World Edition | 27 Mar 2008 | 10:49 am
Crude oil prices on Thursday surged above $107 a barrel after saboteurs attacked a key export pipelines in Iraq, reversing most of last week's losses. The explosion in one of the two exports pipelines... Source: Infocious RSS raw feed - channel BNPaperBusiness | 27 Mar 2008 | 10:46 am
Crude oil prices surged above $107 a barrel after saboteurs attacked a key export pipelines in Iraq, reversing most of last week's losses Source: FT.com - US homepage | 27 Mar 2008 | 10:46 am
The dollar regained some poise against the euro on Thursday, with traders reporting a rise in demand for the currency after two days of sharp losses.A series of weak US economic data - including a surprise... Source: Infocious RSS raw feed - channel BNPaperBusiness | 27 Mar 2008 | 10:42 am
European bourses were stronger on Thursday, defying expectations of further losses after fall overnight on Wall Street, as financial stocks made progress after the world's largest listed hedge fund said... Source: Infocious RSS raw feed - channel BNPaperBusiness | 27 Mar 2008 | 10:34 am
Kingfisher took a knife to its final dividend on Thursday and prepared the ground for a similar cut in the interim dividend, saying it needed the cash to continue investing in its chain of do-it-yourself... Source: Infocious RSS raw feed - channel BNPaperBusiness | 27 Mar 2008 | 10:08 am
Enodis is taking steps to mitigate any weakness in the North American market, although it said on Thursday that most of its businesses continued to perform strongly in the half year to end March and it... Source: Infocious RSS raw feed - channel BNPaperBusiness | 27 Mar 2008 | 10:07 am
Why does anyone still pay attention to analysts covering Wall Street banks? In a time when Bear Stearns is worth $30 a share one week, $2 the next, and then $10 the next, is it any wonder that Wall Street research on Wall Street firms is meaningless?
Yet still, investors eat up their research reports, selling on downgrades, buying on rare positive comments, and holding unless otherwise instructed.
Take Meredith Whitney. Shares of Citigroup plunged nearly 6 percent yesterday after the Oppenheimer analyst quadrupled her estimate for its losses during the current quarter. Whitney became the latest star research analyst last October, when she correctly predicted that Citigroup would need to cut its dividend and raise billions in capital. Ever since, she's been the bear that the Street loves to hate.
But in her report yesterday, aside from the pages upon pages of disclosures required by regulators of equity analysts, what was perhaps Whitney's most important disclosure evidently got very little notice: "[W]e have very little earnings visibility and very little confidence in our estimates." She goes on to say that she doesn't believe she's alone in this predicament.
She may have little confidence in her estimates, but that doesn't stop her from changing her mind about them. A lot. It was just a month ago that Whitney made headlines when she slashed her first-quarter estimate for Citigroup from a profit of 68 cents per share to a loss of 28 cents. Now the estimate stands at a per-share loss of $1.15.
Lehman Brothers evidently presents a similar conundrum. After the bank reported earnings last week, Whitney maintained her buy rating and her $63 price target, calling the report "encouraging."
But less than one week later, Oppenheimer downgraded Lehman stock to neutral and Whitney removed her price target without replacing it. The reason was the "protracted challenging capital markets environment," the very same environment during which Bear Stearns' value quintupled.
Whitney is right about one thing, though: She isn't alone. William Tanona at Goldman Sachs is another analyst who has won accolades by making smart calls on expected losses during this credit crisis. His latest research is only bound to baffle investors further.
After Lehman's earnings announcement last week, Tanona raised his estimates and his price target, and called the stock's price "an attractive entry point." He wrote that he expects the Fed's liquidity facility will help alleviate some strains on the entire broker-dealer industry.
Tanona apparently hasn't gotten whatever memo Whitney got on Lehman several days after its earnings announcement. His recommendation still stands.
And after Morgan Stanley reported better-than-expected results last week, Tanona was positively elated (by today's standards, anyway), and wrote, "We do believe the worst is behind us and that Monday of this week marked a turning point in the stock."
But others at Goldman Sachs aren't so sure. Earlier this week, Andrew Tilton, the bank's chief economist, reported that, by his estimates, the banks haven't even come close to disclosing all of their losses related to the credit crunch. He predicts banks and brokers will eventually own up to $460 billion in credit losses, more than double the $120 billion they've announced so far.
What's it going to be? Are we nearly out of the woods, or so thick in them still that we can't see our hands in front of our faces?
To be fair, it's not easy being an equity research analyst. And it's even more difficult in an environment like we're in, where no one seems to know what anything is worth, and banking leaders have lost credibility. Throw in the confusion around the Bear Stearns fallout, and you've got the making of a perfect storm for anyone in the prediction business.
It's easy to pick on them, but the analysts are arguably doing the best with what they've got. They shouldn't stop now. But investors should stop listening.
Compass, the world's largest caterer, on Thursday dismissed concerns about its exposure to rising food prices, saying trading in the past five months had been ahead of its expectations and sounding an... Source: Infocious RSS raw feed - channel BNPaperBusiness | 27 Mar 2008 | 9:46 am
Saboteurs blew up one of Iraq's two main oil export pipelines in southern Iraq, causing severe damage to the pipeline which transports crude oil to the southern terminals Source: FT.com - US homepage | 27 Mar 2008 | 9:38 am
Kingfisher, the struggling do-it-yourself retailer, is scaling back its investment plans and slashing its dividend by 50pc in a bid to turn the business around. Source: Telegraph Business | 27 Mar 2008 | 9:18 am
Kingfisher, the struggling do-it-yourself retailer, is scaling back its investment plans and slashing its dividend by 50pc in a bid to turn the business around. Source: Infocious RSS raw feed - channel BNPaperBusiness | 27 Mar 2008 | 9:18 am
Memory chip makers including Hynix Semiconductor Inc are considering filing appeals in a long-running court battle over Rambus Inc's patents after a U.S. jury verdict favoured the U.S. technology developer... Source: Infocious RSS raw feed - channel BNPaperBusiness | 27 Mar 2008 | 9:11 am
Asian shares fell on Thursday for the first time in five sessions as pessimism about the US economy grew after an unexpected fall in orders for US durable goods and the lowest sales of new homes in 13... Source: Infocious RSS raw feed - channel BNPaperBusiness | 27 Mar 2008 | 9:01 am
Reuters - Clear Channel Communications Inc
said on Thursday it had won a ruling from a Texas judge
that may advance its efforts to force banks to finance a $20
billion buyout of the U.S. radio operator.
NEW YORK (Reuters) - Clear Channel Communications Inc said on Thursday it had won a ruling from a Texas judge that may advance its efforts to force banks to finance a $20 billion buyout of the U.S. radio operator.
Kingfisher, the struggling do-it-yourself retailer which owns B&Q, is slashing its dividend by 50pc. Source: Telegraph Business | 27 Mar 2008 | 7:40 am
A federal report says New Century and auditor KPMG may be liable for millions.
Driven by a "brazen obsession" with generating sub-prime mortgages, Irvine's New Century Financial Corp. engaged in improper accounting that overstated its profit and allowed top executives to reap millions of dollars in inflated or undeserved bonuses, a U.S. Bankruptcy Court examiner said in a report released Wednesday.
Investment banks that have long-term access to Federal Reserve 'liquidity' should open their books, the Treasury chief says.
Signaling a willingness by the Bush administration to expand its oversight of Wall Street, Treasury Secretary Henry M. Paulson Jr. said Wednesday that investment banks should submit to greater supervision if they want regular access to Federal Reserve loans.
WASHINGTON -- Sales of new homes fell in February for the fourth straight month, pushing activity down to a 13-year low as the steep slump in housing continued.
Maintenance issues ground American, Delta planes, leading to flight cancellations.
The nation's aging airline fleets, already struggling with high fuel costs and growing passenger demand, delivered another blow to travelers Wednesday as American Airlines and Delta Air Lines canceled hundreds of flights while planes were reinspected for compliance with federal maintenance rules. More disruptions are expected today.
Orders for durable goods drop for a second straight time. Additionally, oil rises above $105 a barrel.
The stock market pulled back Wednesday after a second consecutive drop in orders for durable goods generated more pessimism about the economy. Investors also were rattled as oil jumped back above $105 a barrel.
Leftist party decries Calderon's proposal to enlist foreign firms in deep-water drilling.
Mexico's oil has long been a source of national pride. Now, with reserves dwindling away, President Felipe Calderon has floated a controversial initiative to rescue the government oil giant, Pemex: allow foreigners to help the company drill for oil.
Edison plans a massive installation of photovoltaic cells on rooftops, and FPL Energy proposes a 250-megawatt plant.
Solar energy is getting a big boost in Southern California with the unveiling of two projects that will be capable of generating a total of 500 megawatts of electricity, enough to serve more than 300,000 homes.
An improvement to the quarterly current account deficit failed to excite the New Zealand dollar today.
The kiwi trod a roughly 25-point range, despite the December quarter current account deficit beating forecasts by more than... Source: New Zealand Herald - Business | 27 Mar 2008 | 5:27 am
New Zealand's balance of payments deficit in the December quarter was $3.09 billion, substantially better than economists' forecasts of $3.5 billion.
Statistics New Zealand (SNZ) today said the deficit in the year to December fell... Source: New Zealand Herald - Business | 27 Mar 2008 | 12:09 am
Advertising spend in the UK and Europe has yet to be hit by the credit squeeze, the head of M&C Saatchi said today. Source: Telegraph Business | 27 Mar 2008 | 12:05 am
European Central Bank chief Jean-Claude Trichet warned that global markets were in the midst of a major correction which recalled the 1997-98 Asian financial crisis and the first global oil shock. Source: Telegraph Business | 27 Mar 2008 | 12:01 am
Iceland's precarious economy is a warning to other deficit nations about breaking the safe credit 'speed limit' Source: Telegraph Business | 27 Mar 2008 | 12:01 am
US Treasury Secretary Henry Paulson has revealed his department is working on a "blueprint for regulatory reform" in an effort to avert further market turmoil in the wake of investment bank Bear Stearns' collapse. Source: Telegraph Business | 27 Mar 2008 | 12:01 am
If Mervyn King's relations with the City's financiers really are thawing - as some claim - there was little evidence of it yesterday. Source: Telegraph Business | 27 Mar 2008 | 12:01 am
Debenhams shares fell 17pc after one of the retailer's private equity backers sold the majority of its stake. Source: Telegraph Business | 27 Mar 2008 | 12:01 am
The $19bn Clear Channel buy-out collapsed as the media company and private equity firms Bain Capital and Thomas H Lee filed suit against a group of banks led by Citigroup Source: FT.com - US homepage | 26 Mar 2008 | 11:40 pm
Australia's top central banker today said turmoil in global financial markets had been "quite unsettling", but Australia's financial system was in good shape to deal with the fallout.
Speaking to a financial markets conference,... Source: New Zealand Herald - Business | 26 Mar 2008 | 11:36 pm
Oracle said some corporate customers had delayed their spending on new software in recent weeks, triggering a 7 per cent fall in its shares as Wall Street suffered fresh nerves about a slowdown in technology demand Source: FT.com - US homepage | 26 Mar 2008 | 10:42 pm
Investor's Business Daily - The Mortgage Bankers Association's index of applications jumped 48.1% last week to 965.9, the highest since early Feb. Refinancings spiked 82% as borrowing costs fell and homeowners scrambled to get out of adjustable-rate loans. Home purchase applications rose 10.6%. Average 30-year home loan rates fell 0.24 percentage point 15 5.74%, the lowest since early Feb. Source: Yahoo! News: Business | 26 Mar 2008 | 10:41 pm
The New Zealand sharemarket eased in early trading today, following a retreat on Wall Street - particularly among financial sector stocks.
The benchmark NZSX-50 index slipped 7.9 points or 0.23 per cent to 3417.53 in the first... Source: New Zealand Herald - Business | 26 Mar 2008 | 10:33 pm
Goldman Sachs has reclaimed 90 per cent of the $2bn it used to bail out one of its troubled hedge funds last summer as the investment bank moved to shrink the fund and avoid consolidating it on its balance sheet Source: FT.com - US homepage | 26 Mar 2008 | 10:04 pm
Wall Street stocks fell, snapping a three session winning streak after new data suggested the broader US economy faces a downturn and concerns about banks' earnings weighed on sentiment Source: FT.com - US homepage | 26 Mar 2008 | 9:07 pm
Reuters - The C$1 billion takeover of Montreal
Exchange Inc by TSX Group, owner of the Toronto Stock Exchange,
got the blessing of key institutional investors at a regulatory
hearing on Wednesday, but a former separatist premier of Quebec
said the plan should be abandoned.
Bernard Hickey is the managing editor of finance and investment website interest.co.nz.
In the video to the right, he compares America's housing market to New Zealand's and analyses the latest announcement from the US government... Source: New Zealand Herald - Business | 26 Mar 2008 | 9:00 pm
Pressure is building on Telecom to quickly replace two senior executives to quell investor impatience with a slide in earnings and a share price near a 15-year low.
The Sydney Morning Herald reported today that some fund managers... Source: New Zealand Herald - Business | 26 Mar 2008 | 8:47 pm
The New Zealand dollar firmed mildly overnight despite global equities again heading south.
The kiwi was buying US80.39c at 8am against US80.31c at yesterday's close. It briefly topped US81c in overnight trading.
The kiwi's... Source: New Zealand Herald - Business | 26 Mar 2008 | 8:36 pm
The numbers are amazing. MySpace's membership has ballooned from 20 million people in 2005 to 225 million today, an average annual growth rate of 513 percent. Rival Facebook grew at 550 percent a year during the same period. LinkedIn's rate was 182 percent.
Yet one social networking metric is distinctly underwhelming: the one with a dollar sign. Lookery, an ad network specializing in social media, offers display ads on MySpace, Facebook, and Bebo for only 13 cents per thousand times the ad is served (CPM); Yahoo's average CPM is estimated at $13. Video ads on MySpace reportedly fetch just $25 per thousand showings; CBS charges $50 on affiliated sites, NBC as much as $75.
Social networking was supposed to be the Net's next rocket to riches. But many social sites are having trouble capitalizing on their audiences, and it's looking like the convivial atmosphere that promised to boost the value of commercial messages may actually diminish it. Even the big brains at Google are stumped. The search king, which pays a special rate to place ads on MySpace, has suggested that it may be paying too much. "I don't think we have the killer best way to advertise and monetize the social networks yet," Sergey Brin admitted during a January conference call with analysts.
Some smaller competitors are doing better. LinkedIn, for example, has a CPM as high as $75. The difference: The site caters to professionals, making it easier to target ads. (It helps that the company also charges for premium features and job listings.)
For sites with broader audiences, the key may be to give advertising a social dimension. Facebook tried to do just that with Beacon and Social Ads. These formats send users an alert or display ad when one of their pals patronizes an advertiser. But Facebook has yet to gauge the effectiveness of these programs because online privacy watchdogs pounced, and the site moved quickly to let members opt out.
Still, the idea that ads can be a social experience is the industry's best hope. Social Vibe encourages members to choose brands to endorse on their pages. AdRoll shares ads across related niche sites, turning a blogroll into an ad network. But it may take time to work out the business ramifications of online friendship. The first site to meld commercial messaging gracefully into these new group dynamics will have advertisers poking them to be friends.
The country's National Pension Service will no longer buy US Treasuries because yields are too low. The move signals what could be a big shift by financial institutions Source: FT.com - US homepage | 26 Mar 2008 | 7:39 pm
Motorola, the 80-year-old American company that pioneered the car radio, walkie-talkies and the mobile phone, is to separate its struggling handset business from its other operations Source: FT.com - US homepage | 26 Mar 2008 | 7:37 pm
Air New Zealand will offer passengers a voluntary carbon offset scheme that will cost up to $88 per trip.
When passengers book they will be able to donate to an environment trust that will fund research into alternative fuels,... Source: New Zealand Herald - Business | 26 Mar 2008 | 7:00 pm
Motorola is breaking itself in two, but analysts don't agree on whether it's the best move for the company. Lisa Napoli reports. Source: Marketplace | 26 Mar 2008 | 6:05 pm
The number of civilian contractors killed in Iraq last year rose 17%. Not all of them were Americans. Private security firms are increasingly using third-country nationals to support the war. Gretchen Wilson reports from Namibia. Source: Marketplace | 26 Mar 2008 | 6:05 pm
There's been a lot of discussion about whether video games are bad for you, and some research into whether they might actually do you some good. A game called Mindhabits is said to be one of the good ones. Sean Cole reports. Source: Marketplace | 26 Mar 2008 | 6:05 pm
Federal laws passed more than a decade ago encouraged development of leading edge drugs, as well as a way to get them on the market faster. But a study out today says that fast-track process compromises safety. Janet Babin reports. Source: Marketplace | 26 Mar 2008 | 6:05 pm
American Airlines cancelled about 300 flights today to double-check wiring on some of its MD-80 airplanes. The inspections were prompted after an audit by the airline and the Federal Aviation Administration. Jeff Tyler reports. Source: Marketplace | 26 Mar 2008 | 6:05 pm
Commentator Robert Reich wants to call your attention to a mortgage-crisis bill in Congress with an interesting twist. It would allow taxpayers who pick up the tab for bailouts to profit if the gamble pays off. Source: Marketplace | 26 Mar 2008 | 6:05 pm
This week Hillary Clinton called on the government to help homeowners more, John McCain warned against too much government action, and Barack Obama said McCain doesn't know what he's talking about. Nancy Marshall Genzer looks into whether any of them do. Source: Marketplace | 26 Mar 2008 | 6:04 pm
Treasury Secy. Henry Paulson spoke on financial policy today. Frankly, the speech was a bit dull. So we asked some experts to take it apart and tell us what was significant. Kai Ryssdal has more. Source: Marketplace | 26 Mar 2008 | 6:02 pm
Maersk Line has appointed a 33-year veteran of the container industry to head its New Zealand operations. He is Julian Michael Bevis, who for the past two years headed Maersk's Indian Line and Operations business.
Bevis previously... Source: New Zealand Herald - Business | 26 Mar 2008 | 5:30 pm
Investment bank Goldman Sachs estimates global credit losses stemming from market turmoil will reach US$1.2 trillion ($1.5 trillion), with Wall St companies bearing about $460 billion of that total.
US financial firms have reported... Source: New Zealand Herald - Business | 26 Mar 2008 | 5:00 pm
Until this morning, Citigroup was the last holdout among 11 banks sued in the bankruptcy of Enron.
Claims from Enron creditors totaling about $21 billion were headed to a trial set to begin April 28, and a hearing on Citigroup's motion to dismiss the case was scheduled for Thursday in Federal Bankruptcy Court in Manhattan.
Citi has now agreed to pay $1.66 billion to Enron to settle the claims. In a statement, Citi said it agreed to the settlements "solely to eliminate the uncertainties, burden, and expense of further protracted litigation," and noted that the settlement is covered by Citi's existing litigation reserves. Citi also agreed to waive $249.4 million in claims against Enron. For its part, Enron will allow $2.4 billion in credit-linked notes, known as the Yosemite claims, to go forward.
The other banks had earlier agreed to a settlement of what is known as the megaclaims litigation, for a total of $1.76 billion.
But the claim against Citi was always the largest, and the bank's lawyers from Paul, Weiss, Rifkind, Wharton & Garrison, have fought the claims at every juncture, most recently pressing for a change of venue for the trial.
However Citigroup has much bigger problems than the litigation and ample reason to try to put the Enron episode behind it. Under its new chief executive, Vikram Pandit, Citi is trying to dig out from billions of dollars of losses on investments tied to subprime mortgages.
And last week, the Wall Street Journal reported that Steven Digilio, a former Citi vice president, had filed an affidavit in the case, seeking to come forward to testify in the trial without violating his severance agreement with the bank. His affidavit states he sent an email "questioning the appropriateness of continuing to do business with Enron" and saw a handwritten note on an article about Enron and Citi "that may have had the word ‘fraud' in it." The affidavit did not attach the email or article.
Enron representatives say the report of the affidavit "helped" move the settlement talks along.
In January, Citi's brief to throw out the claims called the lawsuit by the Enron creditors "a shameless effort to evade responsibility," because Enron, a company run by "felons and self-confessed fraudsters," had only itself to blame for its collapse.
In fighting the Enron shareholder class action, Citi was not nearly as aggressive: It paid $2 billion in June 2005 to settle securities-fraud allegations, while Merrill Lynch, Credit Suisse, and Barclays fought claims that the banks should be held accountable for their role in Enron's 2001 collapse. Those banks won an appeal at the U.S. Court of Appeals for the Fifth Circuit, and that win was sealed when the Supreme Court issued a ruling in January declaring that there could be no "scheme" liability under the federal securities laws. After ruling in Stoneridge, the justices declined to hear the Enron shareholders' petition. The class-action claims against Merrill and the other banks has since been remanded to Judge Melinda Harmon of the Federal District Court in Houston.
In a long-awaited deal, Ford Motor has agreed on a sale of its Jaguar and Land Rover brands to Tata Motors of India.
The European luxury brands have been a drag on Ford, which is focusing on a turnaround in its North American business. The company is getting $2.3 billion in the sale, but it is contributing $600 million to the Jaguar and Land Rover pension plans when the deal closes. That means Ford is netting roughly a third of what it paid for Jaguar (acquired in 1989) and Land Rover (in 2000).
For Tata, much has been written about how the deal marks a big global leap for the 139-year-old Indian conglomerate that began making cars just 10 years ago. Tata Group, a large steelmaker, has recently ventured into businesses like chemicals and luxury hotels. With the purchase of Jaguar and Land Rover, Tata Motors hopes to learn about marketing and selling in the West.
Some have questioned how Tata Motors can make what seems to be a bigger leap: from mass to class. Tata is best known for being the maker of the cheapest car in the world: the Nano, a 100,000 rupee ($2,500) 33-horsepower car, in India.
Still, if Jaguar and Land Rover can continue to retain their mystique and cachet while being made in Britain—and its history of failed automakers and sometimes shoddy manufacturing—then buyers shouldn't mind too much if their owners are now in Mumbai.
John Elliott on the Riding the Elephant blog on Fortune.com says that besides whether Tata can break the British auto industry's "cycle of decline," the other big question is what happens when Ratan Tata, the conglomerate's patriarch who is now 70, retires.
"It is Tata who has provided the personal drive and leadership to turn Tata Motors into a business that can produce the Nano and buy two world-famous brands in the same year. There's a big job waiting for someone—and Tata is not yet saying who."
Motorola plans to split itself into two companies, spinning off to its shareholders a cell-phone business that has stumbled badly, losing $1.2 billion in 2007.
The other company will encompass Motorola's fast-growing home and networks business, which sells television set-top boxes and modems, and its enterprise mobility solutions, which sells computing and communications equipment to businesses.
It's a move that the legendary activist investor Carl Icahn has been calling for since early last year, when he first set his sights on the troubled company. But even today's announcement will not likely muzzle Icahn on the subject.
Also on Portfolio.com:
Ed Zander on Carl IcahnThe former Motorola C.E.O. talks about his losing battle with the corporate raider.
Icahn first took a stake in Motorola when its shares were trading for about $19. After losing a public battle for a board seat at the May 2007 shareholder meeting, Icahn persevered. He continued to scoop up Motorola shares as they steadily declined, all the while calling for the ouster of chief executive Ed Zander and the splitting off of the company's handheld business.
As of the most recent regulatory filing, Icahn's funds have spent more than $2 billion acquiring 6.3 percent of the telecom company.
Meanwhile, Icahn's pressure has been relentless. Zander's departure in January did little to assuage Icahn. When Motorola flatly rejected two of Icahn's four board nominees for the upcoming proxy fight, the billionaire investor promptly sued for access to board documentation.
But Icahn is in this fight for just one reason: to make money. And Motorola shares rose only 1 percent on the news today, barely flirting with the $10 mark. For Icahn, victory is still a long way off.
Indeed, in an interview with Bloomberg Television earlier this week, Icahn said he was just "in the beginning of the first inning of the fight" for change in the Motorola boardroom.
At the same time, some analysts questioned the move to split the company in two. Under Zander, Motorola became a huge success in cell phones. The company sold more than 100 million of the ultraslim Razr phone. But when sales of the Razr lost ground to lower-priced rivals, the company went into a tailspin and fell behind in advances in mobile phones. Follow-ups to the Razr failed to catch on. Once the leader, Motorola currently has less than a third of the U.S. market.
Now the handset business is lacking both a leader and clear direction, two things that are necessary for its success as a stand-alone unit. Whoever helms the newly independent handset company has a formidable challenge ahead. Nokia, Samsung, and others reportedly passed when Motorola explored a possible sale of the business.
C.E.O. Greg Brown acknowledges there is plenty of work to do, and by planning for the spinoff in 2009, he's bought himself some time.
But Icahn is not a long-term investor, so time is not on his side. The next inning of this battle will take place at the shareholder meeting on May 5.
Reuters - The Dow and S&P 500 stock indexes
opened higher on Thursday after U.S. fourth-quarter economic
growth data met Wall Street's expectations and weekly jobless
claims fell.
Reuters - ConAgra Foods Inc on Thursday said it
would sell its commodity trading and merchandising operations
in a deal valued at $2.1 billion, allowing it to focus on its
core food business and to repurchase shares.
Reuters - U.S. corporate profits fell 3.3
percent in the fourth quarter of 2007, the Commerce Department
said on Thursday in a report that also confirmed U.S. economic
growth slowed to a meager annual pace of 0.6 percent in same
period.
Reuters - Merrill Lynch & Co and UBS AG
may lose money this quarter and suffer write-downs of
$6 billion and $11.1 billion, respectively, as credit problems
worsen, according to Oppenheimer & Co analyst Meredith Whitney.
Reuters - Clear Channel Communications Inc
said on Thursday it had won a ruling from a Texas judge
that may advance its efforts to force banks to finance a $20
billion buyout of the U.S. radio operator.
Reuters - The C$1 billion takeover of Montreal
Exchange Inc by TSX Group, owner of the Toronto Stock Exchange,
got the blessing of key institutional investors at a regulatory
hearing on Wednesday, but a former separatist premier of Quebec
said the plan should be abandoned.