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Economics
Source: Latest Business News from Times Online | 13 Aug 2008 | 5:51 pm

British Energy profits slump 66pc as takeover talks continue

Power giant British Energy is in advanced takeover talks as profits slumped 66pc after production dropped by a quarter at its ageing nuclear stations.
Source: Telegraph Business | 13 Aug 2008 | 10:55 am

Credit Suisse hit with £5.6m fine by FSA

Credit Suisse has been hit with a £5.6m fine by the Financial Services Authority over a UK trading scandal that forced it into a £1.4bn writedown earlier this year.
Source: Telegraph Business | 13 Aug 2008 | 10:40 am

'No growth' in UK economy next year

The Bank of England says it expects the UK economy will not grow at all over the next year, while inflation could hit 5%.
Source: BBC News | Business | World Edition | 13 Aug 2008 | 10:16 am

UBS execs knew of risk of U.S. rule breaches

ZURICH (Reuters) - Senior executives at Swiss bank UBS were aware in 2006 of a whistleblower's complaints into cross-border services provided to U.S. clients, long before a U.S. probe began, a letter from the bank's chairman shows.

Source: Reuters: Business News | 13 Aug 2008 | 10:13 am

The Foreclosure Problem: Death By A Thousand Cuts

The rate of foreclosures continues to accelerate. That generally means that banks are dumping them as fast as they can. Banks don't want to own houses. And, why should they? The value of the asset class is still falling.

The federal government is probably going about trying to steady the economy in the wrong way. Tax rebates last a month or two. Money from the Fed goes onto bank balance sheets, but it is not being passed to consumers and businesses in the form of lower-priced lending.

The Wall Street Journal makes the fairly obvious point that "Stuck with a growing glut of foreclosed houses, banks and investors are shedding them at increasingly steep losses, potentially adding to the banking industry's red ink this year."

The problem is not being attacked at the right place.

Aid to banks and consumers is a very indirect means of stanching the bleeding. If the government is going to spending several hundred billion dollars on pushing money into the economy, it might as well do it where it will have the greatest effect.

There is no reason that the government cannot underwrite the prices that banks get for selling foreclosed home inventory. A credit 10% above the value of the home when it is sold would at least build a floor under the losses banks take. That, in turn, would put a floor under the prices of mortgage-backed securities.

The debate over whether the government should put a heavy hand on the present economic troubles has already been answered by the size of the checks it has written. They are simply being sent to the wrong addresses.

Douglas A. McIntyre

Source: 24/7 Wall St. | 13 Aug 2008 | 10:11 am

Bank of England slashes UK growth forecasts as slowdown deepens

The Bank of England has slashed its economic growth forecast as the sharp slowdown takes the UK to the brink of its first recession in almost two decades.
Source: Telegraph Business | 13 Aug 2008 | 10:10 am

Bank of England slashes UK growth forecasts

The Bank of England has slashed its economic growth forecast as the sharp slowdown takes the UK to the brink of its first recession in almost two decades.
Source: Telegraph Business | 13 Aug 2008 | 10:10 am

Best Buy to sell iPhone in the U.S. (Reuters)

Reuters - Best Buy Co Inc will be the first national retailer to sell Apple Inc's iPhone in the United States in a partnership that could help drive sales of a device expected to be one of the hottest gadgets this holiday season.

Source: Yahoo! News: Business | 13 Aug 2008 | 10:09 am

Best Buy to sell iPhone in the U.S.

ATLANTA (Reuters) - Best Buy Co Inc will be the first national retailer to sell Apple Inc's iPhone in the United States in a partnership that could help drive sales of a device expected...
Source: Infocious RSS raw feed - channel BNewsBusiness | 13 Aug 2008 | 10:08 am

Best Buy to sell iPhone in the U.S.

ATLANTA (Reuters) - Best Buy Co Inc will be the first national retailer to sell Apple Inc's iPhone in the United States in a partnership that could help drive sales of a device expected to be one of the hottest gadgets this holiday season.

Source: Reuters: Business News | 13 Aug 2008 | 10:08 am

Futures point to stock tumble, retail sales eyed (Reuters)

Reuters - Futures for the S&P 500, the Dow Jones industrial average and the Nasdaq 100 were down 0.1 percent on Wednesday at 5:30 a.m. EDT. The S&P 500 and the Dow Jones lost 1.2 percent on Tuesday, while the Nasdaq composite (.IXIC) fell 0.4 percent.

Source: Yahoo! News: Business | 13 Aug 2008 | 10:07 am

Futures point to stock tumble, retail sales eyed

LONDON (Reuters) - Futures for the S&P 500, the Dow Jones industrial average and the Nasdaq 100 were down 0.1 percent on Wednesday at 5:30 a.m. EDT. The S&P 500 and the Dow Jones lost 1.2 percent on Tuesday, while the Nasdaq composite fell 0.4 percent.

Source: Reuters: Business News | 13 Aug 2008 | 10:07 am

Futures point to stock tumble, retail sales eyed

LONDON (Reuters) - Futures for the S&P 500, the Dow Jones industrial average and the Nasdaq 100 were down 0.1 percent on Wednesday at 5:30 a.m. EDT. The S&P 500 and the Dow Jones...
Source: Infocious RSS raw feed - channel BNewsBusiness | 13 Aug 2008 | 10:07 am

Stocks poised for cautious start

U.S. stocks looked set for a lackluster open Wednesday, ahead of retail sales and a weekly report on U.S. fuel stockpiles.

Source: Business and financial news - CNNMoney.com | 13 Aug 2008 | 10:00 am

Capitol Bancorp to Present at Howe Barnes Hoefer & Arnett Thirteenth Annual Community Bank Conference in Chicago, August 19

LANSING, Mich., and PHOENIX, Aug. 13 /PRNewswire-FirstCall/ -- Capitol Bancorp Limited (NYSE: CBC) will be a featured presenter at the Thirteenth Annual Community Bank...
Source: Infocious RSS raw feed - channel BNewsBusiness | 13 Aug 2008 | 10:00 am

Redfin Launches Neighborhood Analytics

First-Ever Neighborhood View of MLS Data, New Online Home-Tour Organizer, Enhanced Favorites SEATTLE, Aug. 13 /PRNewswire/ -- Online real estate broker
Source: Infocious RSS raw feed - channel BNewsBusiness | 13 Aug 2008 | 10:00 am

Bank forecasts inflation will hit 5% by year end

The Bank of England today increased its inflation forecast, stating that it would peak at close to 5 per cent before the end of the year.
Source: Latest Business News from Times Online | 13 Aug 2008 | 9:59 am

GM sees "significant interest" in assets for sale

RAYONG, Thailand (Reuters) - GM chief Rick Wagoner said there was significant interest in the auto maker's planned sale of up to $4 billion of assets as it battles record losses and falling sales, but no deals were expected soon.

Source: Reuters: Business News | 13 Aug 2008 | 9:57 am

GM sees "significant interest" in assets for sale

RAYONG, Thailand (Reuters) - GM chief Rick Wagoner said there was significant interest in the auto maker's planned sale of up to $4 billion of assets as it battles record losses and falling
Source: Infocious RSS raw feed - channel BNewsBusiness | 13 Aug 2008 | 9:57 am

Oil rises ahead of inventory report

Read full story for latest details.

Source: Business and financial news - CNNMoney.com | 13 Aug 2008 | 9:55 am

GM sees "significant interest" in assets for sale (Reuters)

Reuters - GM chief Rick Wagoner said there was significant interest in the auto maker's planned sale of up to $4 billion of assets as it battles record losses and falling sales, but no deals were expected soon.

Source: Yahoo! News: Business | 13 Aug 2008 | 9:55 am

The Dangers Of Overreacting To The Current Economic Environment: Whole Foods Market (WFMI) And Tween Brands (TWB)

Subprime lenders like New Century Financial, Novastar, and, to a large extent, Countrywide Financial, learned a hard lesson in the dangers of operating businesses as though the then-current good economic times would last forever.

Now the economy has taken a turn for the worse, and companies are struggling to react to new realities. Whole Foods Market (WFMI) is trying to convince shoppers that it actually can be a good place for value-conscious consumers, as its results disappoint Wall Street.

Today's Wall Street Journal reports that Tween Brands (TWB) is converting 560 of its Limited Too stores into Justice stores, its lower-price point brand. According to The Journal, "The strategy shift by the New Albany, Ohio, retailer, which sells apparel aimed at 7- to 14-year-old girls, comes as the economic slowdown is causing preteens and teens, along with older consumers, to trade down to lower-priced goods."

I'm not sold on either of these ideas for responding to the economic environment. When times are good, few people realize that they can get bad and, now that they're bad, it's hard to imagine them getting good again. But history has demonstrated amply that economic conditions do bounce back and forth, with a general trend toward the good.

Whole Foods has built an empire over the past 25+ years with its emphasis on a unique upscale environment and high-quality, all-natural and organic products. Investors were rewarded with high margins and stunningly good stock market returns and, now after just a few quarters of that strategy not working in large part because of weak consumer spending, the company is changing course, possibly giving up a lot of what makes it unique in the first place.

Similarly, Tween Brands has struggled to meet its earnings and revenue guidance in recent quarters, and maybe this is one way to do that -- or at least convince anxious investors that the company is doing something to respond to current problems. By switching over to its lower-priced label, the company is giving up its strong margins in a move that will probably look dumb once happy days are here again.

The obsession with quarterly results is forcing companies to "DO SOMETHING!" in response to temporarily weak results when, in reality, focusing on long-term value is what leads to strong returns for long-term shareholders.

Looking at a tough economic picture and making huge changes to the company to make it one that does well in a tough environment while ignoring the upside lost in a good environment is no less of a sin than operating as though the good times will last forever.

Zac Bissonnette

Source: 24/7 Wall St. | 13 Aug 2008 | 9:53 am

Credit Suisse receives £5.6m fine

The Financial Services Authority fines the UK arm of Credit Suisse for mis-pricing certain asset-backed securities.
Source: BBC News | Business | World Edition | 13 Aug 2008 | 9:51 am

US cancels joint military exercise with Russia

The US has cancelled planned joint military exercises with Russia as it considers a range of options in response to what it sees as Russian aggression in Moscow's conflict with Georgia
Source: FT.com - US homepage | 13 Aug 2008 | 9:51 am

Cars that cut your gas bill in half

Attention, horsepower-hungry: Fear not the exploding array of environmentally friendly alternative vehicles. They are a hopeful signal of the potentially mind-blowing stuff to come.

Source: Business and financial news - CNNMoney.com | 13 Aug 2008 | 9:48 am

British Energy says takeover talks continue

British Energy said on Wednesday that it remained in advanced talks about a possible takeover offer, two weeks after a multi-billion-dollar bid from French group EDF was turned down.
Source: Infocious RSS raw feed - channel BNewsBusiness | 13 Aug 2008 | 9:46 am

6 sippin' hybrid alternatives

Check out these not-too-thirsty vehicles that give you fuel economy without giving up style and value.

Source: Business and financial news - CNNMoney.com | 13 Aug 2008 | 9:45 am

Japan Moves Into A Recession Ahead Of The US

By the clock, Japan is twelve hours ahead of the US, By the numbers, it is entering a recession. By most estimates, Japan still has the No. 2 economy in the world based on GDP, and that economy is going to hell in a hand basket.

According to Reuters, "The Japanese economy shrank in the second quarter at its fastest pace since the last recession in 2001." To a very large extent, consumer confidence is to blame.

While the fall-off in GDP in Japan may be happening a little earlier than in the US, it has all of the hallmarks of the downturn here, with the exception of an extremely deep credit crisis. That factor, such a critical part of the American economy, will lever the trouble here down more. In that way, Japan has had some good fortune it the midst of it misery.

Word is that the economy in Hong Kong also slowed sharply in the last quarter. The same is probably true with China, although much of the vote is still out.

One thing is almost certain now. The oppressive combination of high oil and commodities and uneven employment is taking its toll across the globe, which means there is no winch to pull the big economies out of the mud.

Douglas A. McIntyre

Source: 24/7 Wall St. | 13 Aug 2008 | 9:44 am

Earnings Watch: Updates, advisories and surprises

A roundup of the latest corporate earnings reports and what companies are saying about future quarters.

Source: MarketWatch.com - Top Stories | 13 Aug 2008 | 9:31 am

Oil prices firm before US energy inventories data

World oil prices crept higher on Wednesday ahead of the latest weekly report on US energy stockpiles, and amid lingering concerns about the strength of global demand, traders said.
Source: Infocious RSS raw feed - channel BNewsBusiness | 13 Aug 2008 | 9:29 am

UK unemployment total rises

Unemployment rose by 60,000 to 1.67 million in the three months to June as the economic downturn took its toll, official figures show.
Source: BBC News | Business | World Edition | 13 Aug 2008 | 9:29 am

The case for offshore drilling

To some they may seem a bit like Pavlov's dog.

Source: Business and financial news - CNNMoney.com | 13 Aug 2008 | 9:29 am

Indications: U.S. stock futures flat-to-weak before retail sales data

U.S. stock futures traded in a tight range Wednesday ahead of retail sales and import price data as markets attempt to recover from the last session’s financials-led bruising.

Source: MarketWatch.com - Top Stories | 13 Aug 2008 | 9:20 am

London Markets: DSG International shares slide in lower London

Retailers fall in a downbeat London on Wednesday, with DSG International dropping almost 10% after J.P. Morgan downgrades the firm to underweight.

Source: MarketWatch.com - Top Stories | 13 Aug 2008 | 9:19 am

Pound suffers as dollar rebounds

The pound remains near two-year lows against the dollar as traders continue to fret about UK growth.
Source: BBC News | Business | World Edition | 13 Aug 2008 | 9:18 am

Nvidia (NVDA): The Buy-Back Makes A Comeback

Nvidia (NASDAQ:NVDA) defiled itself with earnings which should undercut investor faith in the company for many quarters to come. The graphics chip firm took a charge of nearly $200 million for releasing a faulty chip. It posted a loss of $120 million and revenue dropped slightly. Nvidia also says it underestimated competition from rival AMD (AMD), one of the worst run technical companies on the planet.

As a nifty way to offset all of that bad news, Nvidia said it would buy-back $1 billion of its shares. That spiked the stock price up 10% after hours. It still trades near its 52-week low, but under normal circumstances a bad quarter would have knocked the stock down.

Since Nvidia has a market cap of only $6 billion, it is taking a lot of its shares out of circulation, which should, in turn, improve EPS.

The rise in NVDA shares is a sign of how desperate the market is to find some scintilla of good news in a sea of disastrous earnings. That could bring share buy-backs back into vogue.

It may be a cheap trick, but it looks like it works.

Douglas A. McIntyre

Source: 24/7 Wall St. | 13 Aug 2008 | 9:18 am

Slowing demand knocks oil prices

Oil prices recover slightly after recent falls, but traders warn slowing demand is likely to cap the rise.
Source: BBC News | Business | World Edition | 13 Aug 2008 | 9:17 am

Oil rises to near $114 as dollar weakens

Oil prices rose to near $114 a barrel Wednesday in Asia as the dollar fell against the euro and yen ahead of weekly U.S. crude inventory data. A weakening dollar has helped boost oil...
Source: Infocious RSS raw feed - channel BNewsBusiness | 13 Aug 2008 | 9:09 am

Goldman Sachs (GS) Bets Big On Buyouts Of Yesteryear

While the mainstream media reminisces about the heady days of the private equity bubble with all the fondness of a first-date discussion of past romances, Goldman Sachs is betting big that the unwanted, unloved deals of the past few years are still valuable.

The Wall Street Journal reports that "A Goldman Sachs-led group has agreed to pay about $1.5 billion for a portfolio of existing private-equity investments divested as part of the $101 billion carve-up of Dutch bank ABN Amro by Banco Santander SA, Royal Bank of Scotland Group PLC and Fortis NV."

The $1.05 billion of the investment will be spread among 32 European companies taken private through LBOs, with another $450 million set aside for future deals. This -- and the fact that Goldman has more money lined up for similar investments -- signals that the smartest investment bank in the world is bullish on the prospects of many of the recent buyouts, and is taking advantage of sellers willing to unload the illiquid equity stakes at a discount. That's bad news for the sellers but good news for the market: in spite of the aggressive leverage used and the market's downturn, the equity is still worth buying. The aftermath of the private equity boom appears to be playing out with a resounding "plink" rather than the crash that many had forecast.

Further evidence of how relatively well the aftermath of the LBO boom is playing out comes from the recently filed quarterly earnings of Century 21/Coldwell Banker parent Realogy. Taken private at the height of the private equity and real estate booms, this highly-leveraged deal would seem to be a great candidate for a blow-up. For now that doesn't appear to be the case. The company reported EBITDA of $161 million and a net loss of $27 million -- nothing to brag about but, given the size of the company, not a total disaster either, given that this is the toughest real estate market in recent memory. The company noted that it remains in compliance with the covenants on its debt.

Zac Bissonnette

Source: 24/7 Wall St. | 13 Aug 2008 | 9:04 am

Credit Suisse reaches 5m FSA settlement

The UK financial watchdog on Wednesday announced that it had reached a 5.6m settlement with Credit Suisse over lapses in the Swiss bank's systems and controls relating to a trading scandal earlier this...
Source: Infocious RSS raw feed - channel BNPaperBusiness | 13 Aug 2008 | 9:03 am

Banking fears weigh on European stocks

European equity markets fell on Wednesday as banks were hit by renewed credit fears stemming from the US and causing heavy losses for banking stocks on Wall Street overnight.In early trade, the FTSE Eurofirst...
Source: Infocious RSS raw feed - channel BNPaperBusiness | 13 Aug 2008 | 8:58 am

Dell sees industry computer sales higher in 2nd half

NEW DELHI (Reuters) - Dell Inc , the world's second-largest personal computer maker, sees global industry computer sales in the second half of this year exceeding those in the first half, Chief Executive Michael Dell said on Wednesday.

Source: Reuters: Business News | 13 Aug 2008 | 8:56 am

Dell sees industry computer sales higher in 2nd half

NEW DELHI (Reuters) - Dell Inc , the world's second-largest personal computer maker, sees global industry computer sales in the second half of this year exceeding those in the first half,...
Source: Infocious RSS raw feed - channel BNewsBusiness | 13 Aug 2008 | 8:56 am

ING profit slips 25% on weaker investment returns

Dutch insurance and banking firm ING Group on Wednesday reports a 25% drop in second-quarter net profit as the downturn in markets weighs on its investment returns, though write-downs on risky debt remain low.

Source: MarketWatch.com - Top Stories | 13 Aug 2008 | 8:53 am

ING, Zurich weather credit turmoil with solid results

AMSTERDAM/ZURICH (Reuters) - European financial groups ING and Zurich Financial Services reported quarterly profits that met or exceeded expectations on Wednesday, helped by strong insurance businesses and limited investment writedowns.

Source: Reuters: Business News | 13 Aug 2008 | 8:52 am

Jobless rate rises at fastest pace in 15 years

The number of people claiming unemployment benefits leapt by 20,100 in July, signalling the biggest rise since Britain's last recession in 1992.
Source: Latest Business News from Times Online | 13 Aug 2008 | 8:50 am

Analysts take swipe at Goldman

Goldman Sachs appears to be losing some of its luster.

Source: Business and financial news - CNNMoney.com | 13 Aug 2008 | 8:48 am

For GM, what might have been

General Motors' directors let it be known last week that they are closely watching deteriorating conditions at the automaker. They gave CEO Rick Wagoner a vote of confidence and publicly disclosed that they are monitoring the company's performance on a week-to-week basis.

Source: Business and financial news - CNNMoney.com | 13 Aug 2008 | 8:45 am

Banks and retailers pressure FTSE

London equities fell on Wednesday, tracking overnight losses on US indices after more bad news from the financial sector. The FTSE 100 fell 38 points, or 0.7 per cent, to 5,497.0, with the FTSE 250 losing...
Source: Infocious RSS raw feed - channel BNPaperBusiness | 13 Aug 2008 | 8:42 am

GM to crack down on healthcare coverage: report

(Reuters) - General Motors Corp , looking to trim its nearly $5 billion-a-year health-care tab, is cracking down on workers who are collecting medical benefits for ineligible dependents, the Wall Street Journal said Wednesday.

Source: Reuters: Business News | 13 Aug 2008 | 8:37 am

Japan's economy shrinks on high oil

Read full story for latest details.

Source: Business and financial news - CNNMoney.com | 13 Aug 2008 | 8:35 am

Zurich Financial profit slips 2%

Swiss insurer Zurich Financial Services says second-quarter net income slips 2% as the insurer’s investment income declines by 25%.

Source: MarketWatch.com - Top Stories | 13 Aug 2008 | 8:32 am

ING, Zurich weather credit turmoil with solid results

AMSTERDAM/ZURICH (Reuters) - European financial groups ING and Zurich Financial Services reported quarterly profits that met or exceeded expectations on Thursday, helped by strong...
Source: Infocious RSS raw feed - channel BNewsBusiness | 13 Aug 2008 | 8:26 am

CBA pulls out of talks with RBS

Commonwealth Bank of Australia, the country's biggest mortgage lender, has withdrawn from talks with the Royal Bank of Scotland to buy the Australian and New Zealand operations of ABN Amro, blaming the...
Source: Infocious RSS raw feed - channel BNPaperBusiness | 13 Aug 2008 | 8:25 am

Thomas Cook defies economic slump

Travel operator Thomas Cook says it has seen no evidence yet of consumers cutting back on holidays.
Source: BBC News | Business | World Edition | 13 Aug 2008 | 8:15 am

Speedo's high-speed Olympics splash

Source: Business and financial news - CNNMoney.com | 13 Aug 2008 | 8:08 am

Talks off for Commonwealth Bank

The Commonwealth Bank of Australia pulls out of talks to buy ABN Amro's Australian and New Zealand operations.
Source: BBC News | Business | World Edition | 13 Aug 2008 | 8:08 am

Europe Markets: Financials pressure European shares in early action

European shares fall again on Wednesday, with financials under pressure following the reported end to Australian asset-sale talks for Royal Bank of Scotland and more news on profit trends, while a rising euro and higher oil prices don't help the rest of the market.

Source: MarketWatch.com - Top Stories | 13 Aug 2008 | 8:08 am

Best Buy to sell iPhone in September

Source: Business and financial news - CNNMoney.com | 13 Aug 2008 | 8:07 am

Thomas Cook bookings rise against crunch

Thomas Cook, Europe’s second largest travel company, said today that summer trading has remained resilient while more customers are booking holidays for this year and next.
Source: Latest Business News from Times Online | 13 Aug 2008 | 8:05 am

Oil pauses after fall on steep demand drop

SINGAPORE (Reuters) - Oil steadied above $113 on Wednesday, after falling a day ago to its lowest since May 2 in the wake of official data showing U.S. oil use in its steepest dive in 26 years.

Source: Reuters: Business News | 13 Aug 2008 | 8:05 am

Chinese retail sales still strong

Sales of goods in China's shops grew by 23.3% in July, figures show, the fastest rate in a decade.
Source: BBC News | Business | World Edition | 13 Aug 2008 | 8:04 am

Goldman to pay $1.5 billion for ABN assets: report (Reuters)

Reuters - A consortium led by Goldman Sachs Group Inc has agreed to pay about $1.5 billion for a number of ABN AMRO's private equity assets, the Wall Street Journal said Wednesday.

Source: Yahoo! News: Business | 13 Aug 2008 | 7:52 am

Media Digest 8/13/2008 Reuters, WSJ, NYTimes, FT, Bloomberg

According to Reuters, Goldman Sachs (GS) will buy $1.5 billlion in assets from ABN.

Reuters reports that Ford's (F) new plans will not change because of the fall in gas prices.

Reuters writes that GM (GM) will crack down on healthcare coverage.

Reuters reports that Yahoo! (YHOO) has added new board members to complete a deal with Icahn.

Reuters writes that the Japanese economy shrank in the last quarter, adding to concerns about recession.

The Wall Street Journal reports that a price in the price of cotton has worried some that the market may be manipulated.

The Wall Street Journal writes that banks are getting rid of foreclosed homes at a record rate which could damage their earnings further.

The Wall Street Journal reports that Best Buy (BBY) will begin to sell the Apple (AAPL) iPhone.

The Wall Street Journal reports that CVS (CVS) has decided to buy Longs Drugs.

The Wall Street Journal reports that the US trade gap narrowed on strong exports.

The Wall Street Journal reports that Nvidia (NVDA) posted a loss due to problems with some of its chips.

The Wall Street Journal reports that Yahoo! paid $36 million on its takeover defence.

The Wall Street Journal reports that financial stocks being protected from "shorts" fell anyway.

The Wall Street Journal reports that Dell (DELL) released a number of new laptops to defend its corporate market.

The Wall Street Journal reports that the growth of cable advertising is growing.

The New York Times report that until securitization revives the price of consumer loans will keep rising.

The New York Times reports that the corn crop in the US will hit near-record levels.

The New York Times reports that the market for SUVs is starting to look like the housing market.

The New York Times writes that two out of three US companies paid no corporate income tax between from 1998 to 2005.

The FT reports that banks remain exposed to earnings problems despite sales of toxic debt.

Bloomberg writes that a rally in share of Bank of America (BAC) and brokers is likely to end with the expiration of short selling restrictions.

Douglas A. McIntyre

Source: 24/7 Wall St. | 13 Aug 2008 | 7:52 am

Goldman to pay $1.5 billion for ABN assets: report

(Reuters) - A consortium led by Goldman Sachs Group Inc has agreed to pay about $1.5 billion for a number of ABN AMRO's private equity assets, the Wall Street Journal said Wednesday.

Source: Reuters: Business News | 13 Aug 2008 | 7:52 am

Asia Markets 8/13/2008 (LFC)

Markets in Asia fell

The Nikkei was down 2.1% to 13,023. Konica Minolta fell 4.3% to 1504. Mitsubishi Electic fell 4.2% to 939.

The Hang Seng fell .9% to 21,447. China Life (LFC) fell 2.1% to 27.40. CNOOC rose 4.6% to 10.46.

The Shanghai Composite dropped .4% to 2,446.

Data from Reuters.

Douglas A. McIntyre

Source: 24/7 Wall St. | 13 Aug 2008 | 7:23 am

British Energy sees profits fall

British Energy reports a 66% drop in quarterly profits, hit by falls in production from the group's ageing nuclear power stations.
Source: BBC News | Business | World Edition | 13 Aug 2008 | 7:01 am

British Energy profits plunge on falling output

British Energy profits dropped more than 60 per cent in the three months to June from £179 million to £62 million, the nuclear operator said today.
Source: Latest Business News from Times Online | 13 Aug 2008 | 7:00 am

Caution is the right reaction to chemical

Maybe you've seen the ad showing an empty shopping cart in the middle of the desert. "Soon, many common, everyday products could disappear from grocery store shelves all across California," it warns.

Source: L.A. Times - Business | 13 Aug 2008 | 7:00 am

Former tennis star Tracy Austin accuses broker Gary Fournier of fraud

In a lawsuit, she says the L.A. investment broker inflated his commissions and 'churned' accounts to generate fees. He denies wrongdoing.

Former tennis champion Tracy Austin on Tuesday joined an all-star cast of sports figures in accusing a prominent Los Angeles investment broker of defrauding them.

Source: L.A. Times - Business | 13 Aug 2008 | 7:00 am

Comcast, MGM launch action channel

The video-on-demand cable channel, called Impact, offers action films and TV shows.

The Terminator said he would be back. Now, Comcast Corp. cable TV subscribers can summon him from their sofas.

Source: L.A. Times - Business | 13 Aug 2008 | 7:00 am

Chinese fast-food chain Panda Express thrives on orange chicken

Now celebrating its 25th year, it's one of the largest family-owned fast-food chains in the U.S.

Andrew Cherng remembers pacing through his Chinese restaurant in Pasadena wondering whether any customers would show. It was a difficult time. He had borrowed from family members and the Small Business Administration to open the eatery and had debts to pay.

Source: L.A. Times - Business | 13 Aug 2008 | 7:00 am

U.S. says corn crop will be bigger than expected

The Department of Agriculture says the harvest will be 4.9% bigger than it projected a month ago, as fears of flood damage have abated. Consumers may see lower prices, but some experts are skeptical.

The U.S. corn crop looks to have escaped heavy damage from massive flooding in the Midwest in June, the U.S. Department of Agriculture said Tuesday in issuing a rosier-than-expected projection for this year's harvest.

Source: L.A. Times - Business | 13 Aug 2008 | 7:00 am

CVS to acquire Longs Drug to expand West Coast reach

It's a natural pairing, Longs' CEO says. For shoppers, it might mean fewer choices.

Drugstore chain operator CVS Caremark Corp., the largest provider of prescriptions in the country, said Tuesday that it would acquire Longs Drug Stores Corp. for about $2.6 billion.

Source: L.A. Times - Business | 13 Aug 2008 | 7:00 am

NBC, like Phelps, in record pursuit at Olympics

Olympic viewership is huge, with online content a team player.

As recently as a week ago, a ratings gold medal for coverage of the Beijing Olympics might have looked beyond NBC's grasp.

Source: L.A. Times - Business | 13 Aug 2008 | 7:00 am

Former tennis star Tracy Austin accuses broker Gary Fournier of fraud

In a lawsuit, she says the L.A. investment broker inflated his commissions and 'churned' accounts to generate fees. He denies wrongdoing. ...
Source: Infocious RSS raw feed - channel BNPaperBusiness | 13 Aug 2008 | 7:00 am

UnionBanCal stock rises on takeover threat by Mitsubishi UFJ

Controlling shareholder Mitsubishi UFJ Financial prepares a $3-billion bid after its previous offer was rejected. ...
Source: Infocious RSS raw feed - channel BNPaperBusiness | 13 Aug 2008 | 7:00 am

Thousands whose health policies were canceled to be offered new coverage

The state reaches agreement with Kaiser, Health Net and PacifiCare that will also provide for compensation for medical bills. Lawyers balk at the notification process.

About 3,400 Californians whose health insurance was canceled by Kaiser, Health Net and PacifiCare after they got sick will soon receive notification that they may be eligible for new coverage and for compensation for medical bills they paid while they were uninsured.

Source: L.A. Times - Business | 13 Aug 2008 | 7:00 am

Investment promoter arrested on charge of bribing bank executive

An affidavit alleges that Juan Rangel, who advertised in Spanish-language media, was operating a Ponzi scheme.

An investment promoter who promised Spanish speakers a bonanza in distressed real estate but allegedly cost them millions of dollars has been arrested on a federal charge of bribing a bank executive.

Source: L.A. Times - Business | 13 Aug 2008 | 7:00 am

Russia-Georgia conflict raises worries over oil and gas pipelines

Several important lines pass through Georgia, and for Europeans and others, the routes represent a crucial counterbalance to Russia's control of energy resources.

Russia's invasion of neighboring Georgia has raised doubts about the security of oil and gas pipelines that cross through the former Soviet republic and the wisdom of further investment in the transport lines.

Source: L.A. Times - Business | 13 Aug 2008 | 7:00 am

Comcast, MGM launch action channel

The video-on-demand cable channel, called Impact, offers action films and TV shows. The Terminator said he would...
Source: Infocious RSS raw feed - channel BNPaperBusiness | 13 Aug 2008 | 7:00 am

CVS to acquire Longs Drug to expand West Coast reach

It's a natural pairing, Longs' CEO says. For shoppers, it might mean fewer choices. Drugstore chain operator CVS...
Source: Infocious RSS raw feed - channel BNPaperBusiness | 13 Aug 2008 | 7:00 am

Caution is the right reaction to chemical

A state Senate bill would ban a potentially harmful chemical used in baby bottles and other children's products. But the industry has mounted an ad campaign denouncing the legislation as an all-out assault...
Source: Infocious RSS raw feed - channel BNPaperBusiness | 13 Aug 2008 | 7:00 am

Chinese fast-food chain Panda Express thrives on orange chicken

Now celebrating its 25th year, it's one of the largest family-owned fast-food chains in the U.S. Andrew Cherng...
Source: Infocious RSS raw feed - channel BNPaperBusiness | 13 Aug 2008 | 7:00 am

Japanese economy shrinking

The Japanese economy contracted by 0.6% between April and June, prompting fears that it is sliding towards recession.
Source: BBC News | Business | World Edition | 13 Aug 2008 | 6:33 am

Plug into technology stocks, money manager says

BOSTON (MarketWatch) -- Tom McIntyre, a money manager with McIntyre, Freedman & Flynn in Orleans, Mass., says the market climate is "very positive under the surface," noting that a lot of pricey names are now in a buying range.

Source: MarketWatch.com - Top Stories | 13 Aug 2008 | 6:00 am

Ford plans unchanged with gas price drop (Reuters)

Reuters - Ford Motor Co's plan to overhaul its North American operations to produce more cars remains unchanged amid recent declines in gas prices, a top executive said on Tuesday.

Source: Yahoo! News: Business | 13 Aug 2008 | 5:32 am

Ford plans unchanged with gas price drop

TRAVERSE CITY, Michigan (Reuters) - Ford Motor Co's plan to overhaul its North American operations to produce more cars remains unchanged amid recent declines in gas prices, a top executive said on Tuesday.

Source: Reuters: Business News | 13 Aug 2008 | 5:31 am

Currency: NZ dollar crashes below US69c

The New Zealand dollar crashed through US69c today as Japanese investors offloaded the currency. The low of US68.25c in the domestic session was more than one and half cents below the US69.80c level at 8am. It struggled back to...
Source: New Zealand Herald - Business | 13 Aug 2008 | 5:30 am

GM to crack down on healthcare coverage: report (Reuters)

Reuters - General Motors Corp , looking to trim its nearly $5 billion-a-year health-care tab, is cracking down on workers who are collecting medical benefits for ineligible dependents, the Wall Street Journal said Wednesday.

Source: Yahoo! News: Business | 13 Aug 2008 | 4:53 am

Japan's second- quarter GDP contracts 2.4% on year

HONG KONG (MarketWatch) -- Japan's economy contracted in the April to June quarter on an annualized basis, as softer consumer spending and weak capital investment threaten to bring the country's long post-war expansion to an end.

Source: MarketWatch.com - Top Stories | 13 Aug 2008 | 4:43 am

Asia Markets: Tokyo stocks slide on weak GDP data, stronger yen

HONG KONG (MarketWatch) -- Asian indexes declined Wednesday, with financials such as Mitsubishi UFJ Financial Group weighed down by fears about the global credit markets, while a weak earnings report hit shares of Telstra Corp. in Sydney.

Source: MarketWatch.com - Top Stories | 13 Aug 2008 | 4:32 am

Mark Hulbert: How watching the Olympics can make us better investors

ANNANDALE, Va. (MarketWatch) -- I have some important investment advice for you in the event your favorite athlete or team loses in the Olympics:

Source: MarketWatch.com - Top Stories | 13 Aug 2008 | 4:03 am

Devaluation warning from Kiwi Income Property Trust

Kiwi Income Property Trust says it may be facing the prospect of property devaluations in the future. Chairman Sean Wareing told the trust's annual meeting today that the outlook for the trust, remained positive. The trust's...
Source: New Zealand Herald - Business | 13 Aug 2008 | 4:00 am

Desperate for a Cure

Browsing through email announcements the other day, one caught my eye: "Researcher's herald breakthrough data on Alzheimer's."

The article, on the website FierceBiotech, announced that Singapore-based TauRX Therapeutics had just released what appeared to be spectacular data from Phase II clinical trials for their Alzheimer's drug, called rember.

"Researchers say that rember slowed cognitive decline in 81 percent of the patients taking the drug," the article said.

If true, this was spectacular news for the more than 24 million people who suffer from Alzheimer's disease; currently, there is no effective treatment, and the number of people afflicted by it is forecast to double every 20 years, reaching 80 million by 2040.

Success might also mean a break from rising costs connected to treating Alzheimer's, which is projected to cost Medicare $189 billion in 2015.

I read on, learning that rember acts by detangling a protein in the brain called Tau that bunches up as the disease progresses. It's one of about 30 new medicines being tested right now to treat Alzheimer's. Other drugs work to prevent a build-up of plaques in the brain called amyloids.

Another promising family of drugs works to boost nicotinic receptors in the brain that help regulate memory and cognition. (See Condé Nast Portfolio feature "The Ultimate Cure.")

The TauRX announcement came at a major international Alzheimer's meeting last month in Chicago, where most of the news was not so great. At this gathering, Myriad Genetics provided the unfortunate details of its failed anti-amyloid drug, Flurizan, which the company was forced to abandon in June when it failed to work in clinical trials.

The mood at the meeting was also darkened by a presentation from Elan Pharmaceutical and Wyeth that offered up confusing data about Bapineuzumab, another promising plaque-busting drug that looked as if it, too, might have failed in Phase II trials.

 It turned out that the news about Bapineuzumab was more nuanced than this. Overall, the drug had failed to work, but when researchers parsed through the data, they found that it had shown activity for a subset of test subjects, those who lacked a genetic trait called APOE4 that has been linked to a high risk for Alzheimer's.

Elan and Wyeth will move the drug into a Phase III trial focusing on this subset of patients—though in Chicago, this partial success was not fully understood. That news, coming on top of the Myriad flop, disappointed attendees and left them looking for some good news.

Then Claude Wischik, co-founder and chairman of TauRx Therapeutics, delivered his news.

Actually, Wischik, a researcher at the University of Aberdeen in Scotland and an expert on the Tau protein, reported mostly modest, but positive results from the podium. Even so, many at the meeting were cheered that there might be a compound that will detangle Tau—a process that some speculated could be used in tandem with amyloid-busters to deliver a double-punch to this disease.

So how did this guardedly optimistic presentation of data turn into headlines announcing that rember is a wonder drug?

Apparently, it was a press release issued about the results. Here is the breathtaking headline and first paragraph:

TauRx Therapeutics Ltd & University of Aberdeen
New treatment halts progress of Alzheimer's disease

A major breakthrough in the treatment of Alzheimer's disease is revealed today (July 29) by scientists at the Alzheimer's Association International Conference on Alzheimer's Disease (ICAD 2008) in Chicago, Illinois. Their pioneering research points to a new treatment that appears to slow the progress of the disorder by 81 percent over a year, and could offer hope to millions worldwide. The product—rember—is the first drug to act on the tangles discovered by Alois Alzheimer over a century ago.

As one observer at the meeting told me, this press release was "very aggressively worded."

Another way to describe it: hype.

The result was that a number of science writers went momentarily gaga; headlines blasted from London and Tokyo to Chicago and New York announcing the wonderful news, which later turned out to be not that wonderful.

In a field as complicated as Alzheimer's, with various mechanisms and compounds and companies vying to create a truly miraculous treatment—and with so many people desperate for one—it's not too surprising that something like this happened.

More remarkable is that a few weeks ago the Food and Drug Administration actually approved a new Alzheimer's drug called Axona, but has gotten scant attention.

Developed by Accera, a Broomfield, Colorado, startup, Axona is not the end-all treatment for Alzheimer's, but it has demonstrated that it can boost the energy efficiency of cells and provide general neuro-protective properties that help Alzheimer's patients. Axona seems to work especially well for patients with the APOE4 gene that increases the carrier's risk for Alzheimer's.

"It is being launched as a prescription medical food, which is a slightly different path than a drug," says Zack Lynch, Executive Director of the Neurotechnology Industry Organization.

As the population of our planet ages and tens of millions of brains begin to degenerate, I suspect that there will be many more moments when wishes and desperation for a cure cause a flash of excitement.

Next time, let's hope that the headlines are real. Related Links
Drug Money
HPV Vaccine Inspires Yellow Health Journalism
Actor/Comic Bernie Mac, 50, Dies


Source: Portfolio.com: Top 5 | 13 Aug 2008 | 4:00 am

TelstraClear turns to profit

TelstraClear has turned from a loss to a profit but it still only contributed $7.5 million to its parent's A$6.23 ($7.9) billion annual operating profit. The New Zealand business owned by Australia's Telstra Corp today reported...
Source: New Zealand Herald - Business | 13 Aug 2008 | 3:00 am

Turners and Growers profit up, but people eating cheaper food

Turners & Growers is expecting a softer trading environment for the second half of the year, as people start buying more cheap food. The fruit and vegetable marketer has reported an increase in pre-tax profits to $13.2 million...
Source: New Zealand Herald - Business | 13 Aug 2008 | 2:00 am

Japanese contraction fuels recession fears

Confirming fears that the world's second largest economy could be facing a recession for the first time in six years, Japan's economy contracted an annualised 2.4 per cent in real terms
Source: FT.com - US homepage | 13 Aug 2008 | 1:46 am

Fletcher Building's profit falls 4pc

Fletcher Building, one of New Zealand's biggest companies and the stock exchange's third largest, has announced a 4 per cent profit fall, despite operating earnings growing 10 per cent. The construction and building materials...
Source: New Zealand Herald - Business | 13 Aug 2008 | 1:00 am

Business Briefs - Tuesday

GigaMedia posts winning hand. The Taiwan-based online gaming company said its Q2 EPS rose 18% to 20 cents ex items, topping forecasts by 3 cents....
Source: Investor's Business Daily: BUSINESS | 13 Aug 2008 | 12:41 am

After The Close - Tuesday

APPLIED MATERIALS (AMAT), a manufacturer of chipmaking equipment, said its Q3 EPS fell 51% to 17 cents ex items, topping views by 3 cents. Revenue...
Source: Investor's Business Daily: BUSINESS | 13 Aug 2008 | 12:41 am

In Brief - Tuesday

United Technologies (UTX), an industrial conglomerate, backed its '08 EPS outlook of $4.80-$4.95 vs. views of $4.93. Shares fell 1% to 66.51.
Source: Investor's Business Daily: BUSINESS | 13 Aug 2008 | 12:41 am

Trends & Innovations - Tuesday

Fingerprints reveal more than ID
Source: Investor's Business Daily: BUSINESS | 13 Aug 2008 | 12:41 am

New Products Drive Growth For Medical Imaging Equipment Maker

If Varian Medical Systems builds it, customers will come.
Source: Investor's Business Daily: BUSINESS | 13 Aug 2008 | 12:41 am

Tricks of the trade: How to spot the squeeze

Reducing the size of items on offer without cutting cost is just one way firms can help improve their bottom line.
Source: Telegraph Business | 13 Aug 2008 | 12:01 am

Thomson Reuters share discount widens to 20pc

Thomson Reuters is looking into ways of reducing the discount in its share price between the UK and the US - a discount that widened yesterday after the price fell 5pc in London but rose 1.5pc in New York on slightly down-beat second-quarter results.
Source: Telegraph Business | 13 Aug 2008 | 12:01 am

Currencies

Currencies
Source: Telegraph Business | 13 Aug 2008 | 12:01 am

Tesco secures cash-and-carry toehold in India

Tesco, the UK's largest retailer, will launch a two-pronged assault on the Indian retail market in the latest stage of its global expansion drive.
Source: Telegraph Business | 13 Aug 2008 | 12:01 am

Britain's biggest private companies: Lining up those who made it

Many of Britain's biggest companies are now in private ownership. Over the next fortnight, The Daily Telegraph will profile 100 of the most successful.
Source: Telegraph Business | 13 Aug 2008 | 12:01 am

Songwriter Mark Ronson boosts EMI with extended deal

Prolific songwriter Mark Ronson has given a boost to Guy Hands' EMI by extending his global agreement with the record company's publishing arm.
Source: Telegraph Business | 13 Aug 2008 | 12:01 am

ASB profits up 11pc - $532 million for the year

ASB Bank says it made profits of $532 million during the past year, an 11 per cent jump. This after tax profit, to the end of June, comes despite what the bank says was a "sharp decline" in its home lending business this year....
Source: New Zealand Herald - Business | 13 Aug 2008 | 12:00 am

Cool reception greets UBS shake-up

The biggest European casualty of the credit crisis receives a mixed response as it unveiled measures to improve its performance and sharpen its corporate structure
Source: FT.com - US homepage | 12 Aug 2008 | 11:30 pm

Carlyle sells off steel group for $3.53bn

The Carlyle Group agreed to sell John Maneely, a US manufacturer of steel pipes and tubes, to Russian steelmaker Novolipetsk Steel for $3.53bn, culminating a two-year turnround process
Source: FT.com - US homepage | 12 Aug 2008 | 11:24 pm

UBS chiefs knew of rule breaches

Senior executives were aware that some of their bankers had acted in a way that meant they risked breaching US securities laws at least a year before inquiries began, a letter seen by the Financial Times shows
Source: FT.com - US homepage | 12 Aug 2008 | 11:14 pm

The New York Times Company Has A Dividend? (NYT)(GCI)(MNI)

Source: 24/7 Wall St. | 12 Aug 2008 | 11:06 pm

Wall Street banks hit by downgrades

Goldman Sachs, JPMorgan Chase and Morgan Stanley were hit by a raft of analysts' downgrades on Tuesday amid growing concerns that tough conditions in credit and equity markets will significantly reduce their profits
Source: FT.com - US homepage | 12 Aug 2008 | 11:04 pm

The hangar opens and Richard Branson gives thumbs up

So here we were at 6.20am a couple of Mondays ago at Los Angeles International Airport. Despite the hour, a disc jockey played pulsing club music, a soundtrack that soon continued on board a Virgin America Airbus with “My Other Ride is a Spaceship” emblazoned behind its nose. A 20-minute flight later, the jet landed in Mojave, California, where Sir Richard Branson awaited.
Source: Latest Business News from Times Online | 12 Aug 2008 | 11:00 pm

UBS splits units as it prepares for break-up

UBS turned its back on its “one bank” strategy yesterday and laid the groundwork for a break-up of the once-mighty Swiss bank.
Source: Latest Business News from Times Online | 12 Aug 2008 | 11:00 pm

Home loans plunge amid stricter requirements

The number of mortgages approved for first-time buyers and home movers halved in the year to June, lenders reported yesterday, giving warning that the situation was set to deteriorate further as funding conditions remained difficult.
Source: Latest Business News from Times Online | 12 Aug 2008 | 11:00 pm

UBS shrouds new look in confusion

UBS is about as good at explaining its new strategy as its investment bankers were at preserving its shareholders’ capital. Gone is the “one bank” strategy to be replaced by . . . well, it is not entirely clear. Like strings of unappetising sausages, the management jargon piled up — sustainable value creation, maximum strategic flexibility, rigorous risk framework, cross-divisional collaboration — most of which is vacuous when not contradictory.
Source: Latest Business News from Times Online | 12 Aug 2008 | 11:00 pm

Tesco broadcasts global ambitions with move to supply Indian stores

Tesco is to supply thousands of India's smallest shopkeepers with super-market products after Britain's biggest retailer revealed plans for its first foray into one of the world's fastest-growing economies.
Source: Latest Business News from Times Online | 12 Aug 2008 | 11:00 pm

Energy cutbacks keep pressure on world oil prices

NEW YORK - Oil prices fell again overnight, dampened by a stronger US dollar and more evidence that developed countries such as the United States are cutting back on energy use. Light, sweet crude dipped by $US1.44 to settle at...
Source: New Zealand Herald - Business | 12 Aug 2008 | 11:00 pm

No Market For New Intel (INTC) "Atom" Chip

Intel (INTC) says sales of its new "Atom" chips are off to a good start, although it is unclear what that means. The product line was created for a new generation of portable wireless devices which will sit in the crease between smartphones and PCs. The trouble is that such a crease probably does not exist.

According to Reuters, "Atom is off to a very, very rapid start, far exceeding our expectations when we started the year," Chief Financial Officer Stacy Smith said in an interview. "It's the perfect recession product to have in the marketplace.

There is no perfect product for a recession. Beyond that Apple (AAPL), RIM (RIMM), and Nokia (NOK) are not going to allow tiny PC-like machines to take away the high end of their market, especially now that 3G networks allow for fast wireless handset connections to the internet.

Intel is going to have to stick to PCs and servers.

Douglas A. McIntyre

Source: 24/7 Wall St. | 12 Aug 2008 | 10:48 pm

NZ Shares: Fletcher up after full year result

Fletcher Building shares were up 17c, or 2.6 per cent, in early trade today after the company reported a 4 per cent fall in full year net profit to $467 million. In May the company had said it expected between $450m and $460m profit...
Source: New Zealand Herald - Business | 12 Aug 2008 | 10:26 pm

Harvard's Feldstein Says Fed Slow to Recognize Credit Crisis

Source: Bloomberg - All Podcasts | 12 Aug 2008 | 10:20 pm

Banks remain exposed to risk after debt sales

Citigroup and Deutsche Bank are still retaining some of the risk from billions of dollars in loans backing leveraged buy-out deals that they have sold in recent months to private equity firms, according to securities filings and bank officials
Source: FT.com - US homepage | 12 Aug 2008 | 9:25 pm

VIX Index of U.S. Stock Prices Advances 5.2 % to 21.17

Source: Bloomberg - All Podcasts | 12 Aug 2008 | 9:11 pm

More Financial Fallout Hits Bank ETFs (Daily ETF Wrap-Up)

More hard times for J.P. Morgan, Wachovia and other banks hurt sector ETFs.

Source: SmartMoney.com | 12 Aug 2008 | 9:04 pm

Kiwi will keep on falling: experts

The New Zealand dollar closed below US70c for the first time in 11 months last night and with more Reserve Bank rate cuts on the way there is little to stop it falling further, currency watchers say. The kiwi closed at US69.70c...
Source: New Zealand Herald - Business | 12 Aug 2008 | 9:00 pm

Poterba Says U.S. Consumer `Likely' to Retrench

Source: Bloomberg - All Podcasts | 12 Aug 2008 | 8:38 pm

Revenue growth slows at Thomson Reuters

News from Thomson Reuters that growth in its financial data division had slowed but that it would still hit its growth and savings targets exposed investors' differing views of the dual-listed group on opposite sides of the Atlantic
Source: FT.com - US homepage | 12 Aug 2008 | 8:29 pm

Heavy Write-Downs End Rally

Traders turned bearish after mortgage-related losses cost JPMorgan Chase and UBS billions.

Source: SmartMoney.com | 12 Aug 2008 | 8:24 pm

IPO FILING: US Power Generating Company

Source: 24/7 Wall St. | 12 Aug 2008 | 8:22 pm

Foreign policy pulls in 'Obamacans'

Barack Obama netted the endorsement of three prominent Republicans, including Jim Leach and Lincoln Chafee, both of whom lost their congressional seats to Democratic opponents in the 2006 mid-term elections.
Source: FT.com - US homepage | 12 Aug 2008 | 8:17 pm

More Mortgage Write-Downs Jolt J.P. Morgan (One-Day Wonder)

Bad loans continue to hurt the Wall Street firm, this time to the tune of $1.5 billion.

Source: SmartMoney.com | 12 Aug 2008 | 8:14 pm

Corn prices fall to lowest this year

Corn prices hit their lowest point this year after the US Department of Agriculture revealed that farmers were able to boost the country's crop in spite of the flooding damage
Source: FT.com - US homepage | 12 Aug 2008 | 8:14 pm

Next round in bitter ferry dispute

A bitter dispute between two Hauraki Gulf ferry operators has escalated into threats of trespass notices and a potential claim for $1 million compensation. The latest bout between Australian-owned SeaLink Travel Group and locally...
Source: New Zealand Herald - Business | 12 Aug 2008 | 8:00 pm

8 Stocks for Free Cash Flow Fans (Stock Screen)

Modest valuations and ample cash flows make these eight stocks attractive.

Source: SmartMoney.com | 12 Aug 2008 | 7:44 pm

8 Stocks Fit for Contrarian Investors (Stock Screen)

Our contrarian search found eight stocks, including an implant maker's, due for a lift.

Source: SmartMoney.com | 12 Aug 2008 | 7:02 pm

Russia's next target is its grain industry

Russia apparently wants to be a superpower again, and the plan looks to be government control over its natural resources -- first oil, now grain. Stephen Beard reports the story.
Source: Marketplace | 12 Aug 2008 | 7:00 pm

Sorry, Zara. Gap's Got Game.

Based on first-quarter results, Zara International of Spain has closed the gap on Gap Inc., becoming the world's largest fashion retailer by revenue, the Daily Telegraph points out today.

Inditex, Zara's parent company, said first-quarter revenue rose 9 percent to 2.2 billion euros, or $3.46 billion at the time, while Gap's sales drooped 10 percent to $3.38 billion in the same period.

Gap is certainly one of the mall-based retailers that has taken the hardest beating over the past year, posting double-digit declines in same-stores sales during many months as cash-strapped Americans cut back on discretionary purchasing.

Zara, on the other hand, has continued to make good. Consumers are responding to the retailer's "fast fashion" approach of translating runway looks into retail items at lightning speed, which has meant an ever-changing assortment of cheap, fashionable items in stores.

The ability to offer inexpensive and &uumlaut;ber-trendy looks to consumers is still relatively new, and is changing the game for anyone looking to get a share of a young woman's wallet. Gap hasn't adapted to the sea change all too well, having stubbornly stuck to its once-popular "practical basics" approach for too long.

When times are tough, those are exactly the apparel items for which people are likely to start trading down to Walmart.

Maybe it's just Olympics fever talking, but we're feeling particularly patriotic today, so here are a few reasons why Gap should keep its chin up:

1. The bulk of Zara's 3,900 stores are outside the U.S., where the consumer-spending environment has been significantly stronger during the first half of the year. Gap is unfortunate enough to do more than two-thirds of its business in North America.



2. An $80 million victory over Gap in sales can easily be explained away by the weakness of the dollar against the euro. Gap reports its results (not to mention, sells most of its inventory) in dollars, while Zara has the benefit of dealing in euros. (Indeed, the recent bounce in the buck would have Gap back on top if the figures were converted at today's rate.)



3. While Zara might have perfected the formula for attracting fashion-forward young women, its men's offerings are still nothing to write home about. New research shows that menswear is beginning to be the locus of retail growth, as a shift in mainstream men's fashion has made it essential to buy new basics. Meanwhile, women are tending to put off buying trendy items until the economy improves.

So Zara, don't be so quick to dance on Gap's grave, okay?Related Links
Consumers Balk; Retailers Slump
Aiming Too High?
Retail's Class Divide


Source: Portfolio.com: Top 5 | 12 Aug 2008 | 7:00 pm

The roots of Russia's hostility

Commentator Marshall Goldman says that Russia doesn't care if the rest of the world thinks it's a bully for attacking Georgia and threatening European oil supplies. She tells us why.
Source: Marketplace | 12 Aug 2008 | 7:00 pm

Letters from our listeners

Host Kai Ryssdal reads listener comments on a few of our recent stories. This week, listeners wrote about the cost of fighting wildfires, geriatric medicine and conservative economic policies.
Source: Marketplace | 12 Aug 2008 | 6:59 pm

Italian vintner pairs wine with jazz

A bottle or two of vino might just have you singing. That's probably why an Italian wine maker is using song to promote its product--and it's hitting all the right notes. Megan Williams has the story.
Source: Marketplace | 12 Aug 2008 | 6:59 pm

Are corporate tax breaks now ho-hum?

The GAO report out today says that two-thirds of companies operating in the U.S. aren't paying taxes. So, where's the outrage? Jeremy Hobson reports.
Source: Marketplace | 12 Aug 2008 | 6:59 pm

Campaign TV spots become a bargain

TV stations have slashed the price of advertising because companies that traditionally buy commercials have cut back spending. That means cheaper airtime for political ads. Steve Henn has the story.
Source: Marketplace | 12 Aug 2008 | 6:59 pm

Farmer fields questions on crop report

Host Kai Ryssdal goes right to the source to talk about the government's latest crop survey and its prediction for a bumper corn harvest. An Illinois farmer gives his take on the news.
Source: Marketplace | 12 Aug 2008 | 6:59 pm

Bumper corn and soy crops predicted

Grain prices could fall as farmers are on pace to produce some of the largest corn and soy crops in history. Senior business correspondent Bob Moon asks if that means lower consumer prices.
Source: Marketplace | 12 Aug 2008 | 6:59 pm

Ditching Your Cellphone Provider on the Cheap (Deal of the Day)

Break-up fees are now cheaper. Here's what you'll pay and how to avoid them altogether.

Source: SmartMoney.com | 12 Aug 2008 | 6:50 pm

Analyst Predicts September iPod 'Surprise'

An analyst's job is much like that of a fortune teller. Especially the job of an Apple analyst, who has nothing more to go on than some educated guesswork and the pattern of the tea-leaves left in Steve Jobs' cup of Lapsang Souchong.

Today the analyst in question is the venerable Gene Munster of Piper Jaffray, and he is predicting a September refresh of the iPod lineup. From where did he pull this information? Well, perhaps he cheated and took a look at last years' calendar. And the year before that. And yes, the year before that. Predicting a September iPod event is akin to predicting Christmas sometime in late December: It happens every single year.

The technical details are equally "surprising". Munster reckons that the iPod Shuffle will double in size to 2GB, and that the iPod Touch might be slightly tweaked. We'd agree with both. Memory prices drop, so why not bump the Shuffle a bit? And a new, lower priced Touch, with coloured plastic replacing the shiny metal backplate seems a certainty, too. Munster isn't so sure about the Zune Nano, though.

And according to Macworld, Munster is also betting on a new line of MacBooks at the same time. We say no. Apple's special events usually focus on one product or line. The company likes to send a clear message, and also enjoy the free publicity that comes with its simple, easy to digest product announcements. So while we might see the long rumored aluminum MacBook later this year, it is very unlikely to show up at the same time as the new iPods.

Putting on my analyst hat for a moment, I would like to make a few tech predictions of my own. In the summer of 2009, Apple will release a new iPhone. Also, sometime in the next few weeks, I myself will become so incensed by a piece of perfectly good technology which has been covered in fake jewels that I will rant right here in the pages of Gadget Lab.

And, most predictable of all, in the next month Danny Dumas will turn up at his hairdresser with a page ripped from a teen magazine. Pointing at the hair of the latest boy-band heart-throb, he'll say simply "I want this one".

A September surprise from Apple? [Macworld]Related Links
What's Good for Apple is Better for Everyone Else
How Apple Got Everything Right By Doing Everything Wrong
A Solar-Powered iPod? Puh-lease!


Source: Portfolio.com: Top 5 | 12 Aug 2008 | 6:30 pm

ARPS Scandal: Banks Must Rebuild Investors' Trust (Common Sense)

New details are emerging on the ARPS scandal. The truth is uglier than I suspected.

Source: SmartMoney.com | 12 Aug 2008 | 6:24 pm

U.S. Car Makers Finally Turn a Corner (Common Sense)

Detroit, finally facing reality, plans to (gasp!) make vehicles drivers want to buy.

Source: SmartMoney.com | 12 Aug 2008 | 5:42 pm

8 Home Improvements That Pay Off (Deal of the Day)

Some home improvements pay for themselves when you sell your home. Others don't.

Source: SmartMoney.com | 12 Aug 2008 | 5:35 pm

When Hiring an Advisor Makes Financial Sense (Ticked Off)

Considering hiring a planner? Here's how to know if it makes financial sense.

Source: SmartMoney.com | 12 Aug 2008 | 3:56 pm

Broadway's Strouse Embraces `Street' Interpretations of Music

Source: Bloomberg - All Podcasts | 12 Aug 2008 | 3:41 pm

Goldman Profit Estimates Lowered by Deutsche Bank, Oppenheimer

Source: Bloomberg - All Podcasts | 12 Aug 2008 | 3:37 pm

The July Curse

First, it was March that was the worst month for banks since the credit crunch. Then June came along and ruined the second quarter for so many financial institutions.

Now, it looks like July might win the contest to be the worst month for mortgage-related securities since the credit crisis began one year ago.

In its quarterly S.E.C. filing, J.P. Morgan Chase disclosed yesterday that it has already taken a $1.5 billion hit on its mortgage assets since July, as "trading conditions have substantially deteriorated versus the second quarter."  As of June 30, the bank held approximately $33 billion worth of mortgage-related securities on its balance sheet.

Of course, $1.5 billion isn't an alarming number for a bank the size of J.P. Morgan, especially considering how well it has performed during this credit crisis next to its competitors. (Click here for an interactive on bank losses.)

What's more troubling is what this could mean for the rest of the pack.

July was particularly tough for this market because it was a month that saw near-collapses of Fannie Mae and Freddie Mac. It was also the month when Merrill Lynch decided to unload the worst of its mortgage portfolio for whatever price it could get, which turned out to be 22 cents on the dollar.

Other banks will almost certainly follow suit, but not all of them are capitalized well enough to endure such potentially significant write-downs. They will likely need to raise more capital, which isn't easy in this environment. Merrill Lynch diluted its shareholders significantly when it raised $8.5 billion as it simultaneously wrote down $5.7 billion in losses.

Lehman Brothers has reportedly tried to find outside investors to help shore up its balance sheet to compensate for more write-downs. It is also weighing a sale of its Neuberger Berman business, according to several reports.

The mortgage market isn't likely to turn around anytime soon. Delinquencies from prime borrowers are on the rise, and the real estate site Zillow reports today that nearly one-third of all homeowners who bought since 2003 are now under water on their mortgages. All of this leads to even more pain from other banks with significant exposure to the mortgage market, including Washington Mutual, Citigroup, Bank of America, and Wachovia Bank.

But wait, there's more! It's not just about mortgages anymore.

Settlements with regulators over the sales of auction rate securities are going to put yet another dent in profits (or losses, as the case may be). Yesterday, Wachovia lowered its estimated loss for the third quarter to $9.1 billion from $8.9 billion due to increased costs from its ARS exposure.

Merrill Lynch, UBS, and Citigroup have already agreed to buy back $36 billion of the illiquid securities from its clients. Morgan Stanley, J.P. Morgan, and Wachovia are expected to settle.

And then there's Goldman. Seemingly untouchable, Goldman Sachs has its own set of concerns as the credit crisis turns one. Oppenheimer analyst Meredith Whitney lowered her estimates for the bank's third quarter not because of the tough mortgage market or auction-related securities, but because of the effects of the turmoil on the rest of the banking industry.

"The primary drivers for these revisions are customer volumes, overall weak global equity markets, and weak advisory and underwriting revenues," Whitney wrote.

Deutsche Bank analyst Mike Mayo downgraded his rating on Goldman today due to its high exposure to the weak global equities markets.

The result of all this bad news is a sharp downturn in stocks across the financial sector today. Many pundits declared the bottom for these shares on July 15, the middle of what's shaping up to be the worst month yet.

Perhaps it was. But who knows what September will bring?

Related Links
Good Morning on Wall Street
Why is the Fed Discriminating Against Investment Banks?
The End of Mortgage Brokers, Part 2


Source: Portfolio.com: Top 5 | 12 Aug 2008 | 2:00 pm

Standard Life's Milligan Sees U.S. Dollar Moving Higher

Source: Bloomberg - All Podcasts | 12 Aug 2008 | 1:13 pm

UBSssssssssss

More than any other bank being whacked by the credit crisis, UBS is in urgent need of a turnaround strategy.

The Swiss giant sought to present one today, announcing plans to separate its investment-banking and wealth-management businesses. It represents a big break for UBS, taking a step away from the financial-supermarket model that it once championed and is now followed, if somewhat less enthusiastically, by rivals like Citigroup.

The reorganization will give the units more autonomy while keeping them under the same corporate umbrella. The move has sparked speculation that the investment-banking business may be sold this year.

It's the investment-banking unit that has been the source of most of UBS's woes, having plunged deeply into securities tied to subprime mortgages in the United States. UBS today announced that it was writing off an additional $5.1 billion, for a total of more than $40 billion on credit investments related to subprime.

The write-down led to a loss of $329 million for the quarter, the bank's fourth consecutive quarterly loss.

"The second quarter 2008 remained difficult for several reasons," the bank said in a statement. "The positive sentiment seen at the end of first quarter 2008 that the credit crisis may be easing was short lived, as trading conditions deteriorated significantly in the second half of May."

Distancing the investment-banking business from the rest of the bank will give some comfort to UBS's wealthy clients, who have been pulling out their money at an alarming rate. The bank reported an outflow of $41 billion in the second quarter.

Felix Salmon applauds the move to separate the units as a "sensible response."

"Losing the private bank would leave the rump UBS with much more volatile earnings," he notes, "but the value of a unit managing more than $1.6 trillion is mind-boggling."

"A bit like Neuberger Berman at Lehman Brothers, the buy-side is worth such an enormous percentage of the whole that, at some point, it becomes impossible for a fiduciary not to sell (or at the very least spin) it off."

But the wealth management's problems are more than the collateral damage from subprime. There are also the investigations into whether UBS helped American clients illegally evade taxes, as Lucy Komisar has reported for Portfolio.com.

And there are questions as to whether UBS management and its board are up to the task of an overhaul. Their credibility has steadily eroded by quarter after quarter of write-downs and vague suggestions of changes at the bank. (In response to criticisms, the bank today named a new finance chief and proposed four new members for its board.)

So it is not immediately clear how having three autonomous units (asset management is the third) will bolster UBS. Costs will probably increase as a result, and all three will have to cope with the damage to the UBS brand.

UBS may indeed be on the right track; but its past mistakes could keep it from getting very far.

Related Links
Why UBS's Wealth Management Should Stand Alone
Citi's New Chief
UBS Warns of Turmoil's Impact


Source: Portfolio.com: Top 5 | 12 Aug 2008 | 11:30 am

Most companies in US avoid federal income taxes (AP)

AP - Two-thirds of U.S. corporations paid no federal income taxes between 1998 and 2005, according to a new report from Congress.
Source: Yahoo! News: Business | 12 Aug 2008 | 10:31 am

SEC working on short-selling proposals: report (Reuters)

Reuters - The U.S. Securities and Exchange Commission is working to unveil a proposal next month that would permanently tighten existing rules for short selling, the New York Post said citing people in talks with the agency.
Source: Yahoo! News: Business | 12 Aug 2008 | 8:57 am