5/9/08 Crude Oil
Crude-oil futures blitzed past the $126 a barrel mark Friday, rallying to a record high of $126.20, pushed higher by weakness in the U.S. dollar and concerns over supply disruptions.
AIG reported its record $7.8 billion loss, eclipsing the $5.3 billion loss it recorded in the fourth quarter. AIG said credit-market woes, weakness in housing and stock-market volatility "had a substantial adverse effect" on its results. "The severity of the unrealized valuation losses and decline in value of our investments were beyond our expectations," said AIG Chief Executive Martin Sullivan. The New York-based insurance behemoth took a $9.1 billion write-down for the first quarter on credit derivatives designed to protect against losses on a variety of investments, including subprime mortgages. It booked an additional $6.1 billion in losses in its investment portfolio.
According to AMG Data Services, for the week ending May 7, including ETF activity, Equity funds report net cash inflows totaling $1.521 billion in the week ended 5/7/08 with Domestic funds reporting net inflows of $72 million and Non-domestic funds reporting net inflows of $1.449 billion;
Excluding ETF activity, Equity funds report net cash inflows totaling $699 million with Domestic funds reporting net inflows of $437 million and Non-domestic funds reporting net inflows totaling $262 million.
Rice surged for a third day by the maximum allowed as Nigeria and the Philippines, the two largest importers, sought shipments, further straining global supplies after a cyclone devastated crops in Myanmar.
According to Business Week, Merchant cash advances have been around for roughly a decade. But with big banks in full retreat from lending, more small business owners are seeking help from the likes of AdvanceMe, AmeriMerchant, and hundreds of other companies and independent contractors that offer such advances. The size of the industry jumped 50% in 2007, to around $700 million.
The number of companies defaulting on their junk-rated debt and filing for bankruptcy in North America is running at its fastest pace in five years amid the slowing economy and contraction in credit markets. So far this year, 28 “entities” have defaulted, according to Standard & Poor’s. The defaulted debt of the one Canadian and 27 US companies totals $18.4bn and exceeds the 17 defaults in the US for all of last year.
Henry To: "I expect a significant buying opportunity in small cap value stocks sometime over the next 12 to 18 months - but given that we are still in a general deleveraging environment, I also expect small cap value stocks to under perform at least for the rest of this year (homebuilders and newspaper publishers come into mind)."
Brad Setser: "Barring a major change, the Gulf and China could easily combine to add close to a trillion dollars to their official assets this year."
"Our recently completed financing arrangements give the company record levels of liquidity, with approximately $2 billion in immediately available excess capacity," said Ed Heffernan, Alliance Data's chief financial officer. "We currently expect that Alliance Data could secure an additional $1.5 billion to $2 billion in capacity while maintaining an investment grade profile by levering up from approximately 1x to 3x." Alliance Data said it expects to continue meeting or beating Wall Street's earnings forecasts throughout the year.
According to the Seattle Post-Intelligence, International Lease Financial, the largest customer for Boeing's 787 with 74 on order, said its planes will be delayed "an average in excess of 27 months per aircraft and span across ILFC's entire order." Air Canada said its 787s will be 24 to 30 months late, and probably won't get its first 787 until 2012. Delays could cost Boeing $4 billion in fines.
Citigroup CEO Vikram Pandit said Friday the firm plans to reduce about $500 billion of non-core assets over the next several years.
In a sign of weaker global growth, both imports and exports fell sharply in March, driving the U.S. trade deficit down to $58.2 billion, the Commerce Department reported Friday. Nominal imports fell 2.9% to $206.7 billion, the largest decline in more than six years, despite record oil prices. Nominal exports dropped to $148.5 billion, the biggest drop in nearly three years, despite higher prices for U.S. farm products.
As recently as mid-January, Clinton, with her family's deep roots in the Democratic establishment, led Obama by nearly 100 superdelegates. By Friday morning, Obama had narrowed her lead to 3, as he picked up 5 more supporters.
Obama also picked up the endorsement of the influential American Federation of Government Employees union on Friday.
The market for highly structured credit products exposed to residential mortgage securities hasn't rebounded, American International Group Chief Financial Officer Steven Bensinger said on Friday during a conference call with analysts.
China's overseas sales rose about 21.8 percent from a year earlier, after gaining 30.6 percent in March, according to figures derived from Ministry of Commerce data. The trade surplus was about $16.8 billion compared with $16.7 billion a year earlier.
Communications equipment maker Harris has started exploring strategic options, which may lead to its eventual sale, the Wall Street Journal said on Friday, citing people familiar with the matter. The company serves the government and commercial markets in more than 150 countries, has annual revenues of over $5 billion and more than 16,000 employees.
June gold climbed $3.70 an ounce Friday to close at $885.80. The June contract closed at $125.96 a barrel, up $2.27 for the session and up 8.3% for the week.
“Saudi Arabia is forecast to earn 975 billion riyals ($260 billion) in oil revenue this year as record oil prices boost its current account surplus, Arab News reported, citing a report from Jadwa Investment Co.”
FedEx cut its quarterly-profit forecast again, citing unrelenting fuel-price increases and soft demand.
One-month Treasury bill rates surged 25 bps this week to 1.59%, and 3-month yields rose 15 bps to 1.68%. At the same time, two-year government yields sank 21 bps 2.24%.
Doug Noland: "I don’t believe it is mere coincidence that crude has posted about a 30% y-t-d price surge at the same time as international reserve positions have expanded at about a 30% annualized rate - to a stunning $6.769 TN. Over the past 4 ½ years, official international reserves have ballooned an unprecedented $3.921 trillion, or 138%. During this period, crude prices surged almost 300%. Chinese reserves ballooned more than four-fold over this period to $1.68 Trillion; India’s reserve position tripled to $303bn; and Brazil enjoyed a four-fold increase to $189bn. After beginning 2004 at $73bn, Russian reserves have almost reached the half Trillion mark ($493bn). And just in the past year, OPEC reserves have inflated 42% to $490bn. To be sure, the world is awash like never before in excess “liquidity” for which to bid up the price of critical tradable resources...The CRB Commodities index closed today at an all-time high, sporting y-t-d gain of 19% and one-year rise of 37%. The Goldman Sachs Commodities index, also ending at a record high, has gained 28% so far this year and 68% over the past 12 months. During the past year, soybeans have gained 85%, corn 72%, and wheat 68%. Prices for iron ore, steel and hard commodities have experienced similar price inflation. Gasoline prices are up almost 40%, natural gas about 50%, and heating oil about 90% over the past year...Industries throughout the U.S. and global economies now confront a fundamentally altered environment, where the pricing and availability of key inputs can no longer be taken for granted. For many, the whole idea of “just in time” inventory management has become a luxury that can no longer be afforded. Moreover, recent media accounts have illuminated the problems suffered by farmers and grain elevator operators because of recent dislocations in commodities derivative trading. Financial derivatives markets, having functioned well in the commodities arena for the most part for years now, will now play a destabilizing role in a new era of acute supply/demand imbalances...Furthermore, current inflationary forces are destabilizing and even destructive to many businesses, while playing havoc with the fiscal standing of federal, state and municipal governments."
Saturday, May 10, 2008
Friday, May 09, 2008
Retail
5/8/08 Retail
Higher same-store-sales figures for April were skewed by an early Easter.
Wal-Mart sees May same-store sales ex fuel flat to up 2%. US same-store sales were up 3.2% in April. Shoppers scooped up the chain’s grocery, health and wellness and entertainment offerings. Wal-Mart cited strong sales of flat-panel TVs, video games and gaming systems, even as it warned that consumers are showing signs of being tapped out. “The economy continues to get tougher and the ‘paycheck cycle’ is more pronounced for customers than in past months,” U.S. stores chief Eduardo Castro-Wright said. “As money gets tighter for them toward the end of the month, sales drop more than we have seen in the past.”
Cosco said excluding gasoline price inflation, comparable sales would have been up 5% in its U.S. home market in April.
The European Central Bank on Thursday held its key interest rate at 4% as inflation worries outweighed concerns over an economy whose growth appears to be stalling.
The number of people filing for the first time for unemployment benefits fell by 18,000 to 365,000 on a seasonally adjusted basis in the week ending May 3, the Labor Department reported Thursday. The four-week average of initial claims, which smoothes out one-time factors such as bad weather or holidays, moved up by 2,500 to 367,500. The number of people collecting benefits fell by 10,000 in the week ending April 26 to 3.02 million. The four-week average of continuing claims nudged higher by 16,750 to 3 million, the most in four years. Compared with the same time last year, initial claims are up about 17%, while continuing claims are up about 19%.
U.S. retail gasoline prices rose 3 cents to just under $3.65 a gallon in the last day, after holding near $3.60 a gallon for the past several days, according to the Daily Fuel Gauge Report from the AAA. Prices averaged about $3.33 a gallon a month ago and $3.03 a year ago, according to the survey of up to 100,000 self-serve stations.
The Bank of England left its key interest rate unchanged at 5% Thursday as inflation fears persuaded it to take a wait-and-see approach.
Iran's oil minister has predicted the price of oil will rise to $200 per barrel in the near future, the official IRNA news agency reports.
Toyota’s quarterly profit dropped 28% as a stronger yen and lagging North American sales chipped away at earnings.
ABC News has learned that David Bonior, the campaign manager for the 2008 presidential race of Sen. John Edwards, D-NC, will endorse Sen. Barack Obama, D-Illinois, today.
Hongkong & Shanghai Hotels Ltd., owner of the luxury Peninsula chain, expects business in Asia to be hurt by the global economic slowdown, citing Chairman Michael Kadoorie.
George Soros: "The markets are breathing a sigh of relief but the fallout in the real economy is only now beginning.”
Unilever, the world's second-largest maker of food and detergent, said revenue will beat its forecast for the first time in six years on increased prices and sales of Dove soap, Hellmann's mayonnaise and Lipton tea.
Bill Bonner: "Since '95, reports Martin Hutchinson, the U.S. money supply, as measured by 'money of zero maturity,' has gone up at about 8.8% per year. The average fellow, seeing that he has 8.8% more cash - and with no knowledge of the volume theory of money - might reasonably conclude that he is richer. But when money increases faster than the goods and services it's destined to pay for, the result is rising prices. At 8.8%, U.S. money supply was increasing about 50% faster than the GDP. You'd expect prices to rise and the dollar to fall - which is exactly what has happened. But recently, the feds have put their fabulous money machine into high gear. MZM has been going up at a 28% annual rate over the last three months."
Microsoft has no plans to make another approach for Yahoo after it pulled its $47.5 billion bid earlier this month, Microsoft's Chief Research and Strategy Officer Craig Mundie said on Thursday.
McDonald's Corp. said Thursday its April sales at global stores open at least one year rose 5%, while same-store sales at its U.S. restaurants rose just 2%
Nordstrom Inc.'s same-store sales, or sales of stores open at least a year, fell 3.8% in April.
Ross Stores Inc., an apparel retailer, on Thursday raised its earnings outlook for the quarter ending May 3 because of stronger margins and favorable expense trends. Ross Stores now expects to earn between 59 and 60 cents per share during the quarter ending May 3. It previously anticipated earnings between 56 cents and 58 cents per share.
Valero Energy Corp. said it's selling its 85,000 barrel-per-day refinery in Krotz Spring, La. to Alon USA Energy Inc. in a deal worth up to $433 million. The price includes $333 million plus an earn-out provision value at more than $100 million.
Barr Laboratories tumbled more than 20% on a lower-than-expected earnings report that prompted the company to also lower its 2008 financial forecast.
Natural-gas inventories rose by 65 billion cubic feet for the week ended May 2, the Energy Department said Thursday. Analysts at Global Insight expected a climb of 76 billion. Total stocks now stand at 1.436 trillion cubic feet, down 284 billion cubic feet from the year-ago level and 11 billion cubic feet below the five-year average, the government data said.
"I don't see any way she can put this together any more -- she can't win the popular vote or the delegate count -- so what's the rationale?" said a major Clinton supporter from New York, speaking on condition of anonymity. "I think the challenge now is letting her leave with dignity and grace and letting the process go forward. She has got to leave on a high note. She's got to determine her own exit strategy."
June crude closes at $123.69/brl, up 16 cents for the day. Gold for June delivery rose $10.90 to end at $882.10 an ounce on the New York Mercantile Exchange.
Oil futures topped $124 in electronic action on Friday, rising 51 cents to $124.40 a barrel.
Allianz Group, Europe's largest insurer, said Friday that net income for the first quarter fell 65% to 1.15 billion euros ($1.77 billion), owing to a 845 million euro mark-down on structured products and lower realized gains from investments.
China's producer price index climbed 8.1% in April from a year earlier, marking the ninth straight month of gains, led by higher energy and industrial metals prices. A measure that captures gains in fuel, raw material and power climbed 11.8% in April from a year earlier. Among individual components, crude oil prices climbed 37.9%, coal rose 20.9%, ferrous metals were up 24.8% and gasoline climbed 10.8%.
The Reserve Bank of Australia increased its inflation forecasts for this year, noting underlying CPI is to remain above its target band until late 2010 at the earliest, dampening expectations interest rates could fall from their current 12-year high of 7.25% any time soon.
Higher same-store-sales figures for April were skewed by an early Easter.
Wal-Mart sees May same-store sales ex fuel flat to up 2%. US same-store sales were up 3.2% in April. Shoppers scooped up the chain’s grocery, health and wellness and entertainment offerings. Wal-Mart cited strong sales of flat-panel TVs, video games and gaming systems, even as it warned that consumers are showing signs of being tapped out. “The economy continues to get tougher and the ‘paycheck cycle’ is more pronounced for customers than in past months,” U.S. stores chief Eduardo Castro-Wright said. “As money gets tighter for them toward the end of the month, sales drop more than we have seen in the past.”
Cosco said excluding gasoline price inflation, comparable sales would have been up 5% in its U.S. home market in April.
The European Central Bank on Thursday held its key interest rate at 4% as inflation worries outweighed concerns over an economy whose growth appears to be stalling.
The number of people filing for the first time for unemployment benefits fell by 18,000 to 365,000 on a seasonally adjusted basis in the week ending May 3, the Labor Department reported Thursday. The four-week average of initial claims, which smoothes out one-time factors such as bad weather or holidays, moved up by 2,500 to 367,500. The number of people collecting benefits fell by 10,000 in the week ending April 26 to 3.02 million. The four-week average of continuing claims nudged higher by 16,750 to 3 million, the most in four years. Compared with the same time last year, initial claims are up about 17%, while continuing claims are up about 19%.
U.S. retail gasoline prices rose 3 cents to just under $3.65 a gallon in the last day, after holding near $3.60 a gallon for the past several days, according to the Daily Fuel Gauge Report from the AAA. Prices averaged about $3.33 a gallon a month ago and $3.03 a year ago, according to the survey of up to 100,000 self-serve stations.
The Bank of England left its key interest rate unchanged at 5% Thursday as inflation fears persuaded it to take a wait-and-see approach.
Iran's oil minister has predicted the price of oil will rise to $200 per barrel in the near future, the official IRNA news agency reports.
Toyota’s quarterly profit dropped 28% as a stronger yen and lagging North American sales chipped away at earnings.
ABC News has learned that David Bonior, the campaign manager for the 2008 presidential race of Sen. John Edwards, D-NC, will endorse Sen. Barack Obama, D-Illinois, today.
Hongkong & Shanghai Hotels Ltd., owner of the luxury Peninsula chain, expects business in Asia to be hurt by the global economic slowdown, citing Chairman Michael Kadoorie.
George Soros: "The markets are breathing a sigh of relief but the fallout in the real economy is only now beginning.”
Unilever, the world's second-largest maker of food and detergent, said revenue will beat its forecast for the first time in six years on increased prices and sales of Dove soap, Hellmann's mayonnaise and Lipton tea.
Bill Bonner: "Since '95, reports Martin Hutchinson, the U.S. money supply, as measured by 'money of zero maturity,' has gone up at about 8.8% per year. The average fellow, seeing that he has 8.8% more cash - and with no knowledge of the volume theory of money - might reasonably conclude that he is richer. But when money increases faster than the goods and services it's destined to pay for, the result is rising prices. At 8.8%, U.S. money supply was increasing about 50% faster than the GDP. You'd expect prices to rise and the dollar to fall - which is exactly what has happened. But recently, the feds have put their fabulous money machine into high gear. MZM has been going up at a 28% annual rate over the last three months."
Microsoft has no plans to make another approach for Yahoo after it pulled its $47.5 billion bid earlier this month, Microsoft's Chief Research and Strategy Officer Craig Mundie said on Thursday.
McDonald's Corp. said Thursday its April sales at global stores open at least one year rose 5%, while same-store sales at its U.S. restaurants rose just 2%
Nordstrom Inc.'s same-store sales, or sales of stores open at least a year, fell 3.8% in April.
Ross Stores Inc., an apparel retailer, on Thursday raised its earnings outlook for the quarter ending May 3 because of stronger margins and favorable expense trends. Ross Stores now expects to earn between 59 and 60 cents per share during the quarter ending May 3. It previously anticipated earnings between 56 cents and 58 cents per share.
Valero Energy Corp. said it's selling its 85,000 barrel-per-day refinery in Krotz Spring, La. to Alon USA Energy Inc. in a deal worth up to $433 million. The price includes $333 million plus an earn-out provision value at more than $100 million.
Barr Laboratories tumbled more than 20% on a lower-than-expected earnings report that prompted the company to also lower its 2008 financial forecast.
Natural-gas inventories rose by 65 billion cubic feet for the week ended May 2, the Energy Department said Thursday. Analysts at Global Insight expected a climb of 76 billion. Total stocks now stand at 1.436 trillion cubic feet, down 284 billion cubic feet from the year-ago level and 11 billion cubic feet below the five-year average, the government data said.
"I don't see any way she can put this together any more -- she can't win the popular vote or the delegate count -- so what's the rationale?" said a major Clinton supporter from New York, speaking on condition of anonymity. "I think the challenge now is letting her leave with dignity and grace and letting the process go forward. She has got to leave on a high note. She's got to determine her own exit strategy."
June crude closes at $123.69/brl, up 16 cents for the day. Gold for June delivery rose $10.90 to end at $882.10 an ounce on the New York Mercantile Exchange.
Oil futures topped $124 in electronic action on Friday, rising 51 cents to $124.40 a barrel.
Allianz Group, Europe's largest insurer, said Friday that net income for the first quarter fell 65% to 1.15 billion euros ($1.77 billion), owing to a 845 million euro mark-down on structured products and lower realized gains from investments.
China's producer price index climbed 8.1% in April from a year earlier, marking the ninth straight month of gains, led by higher energy and industrial metals prices. A measure that captures gains in fuel, raw material and power climbed 11.8% in April from a year earlier. Among individual components, crude oil prices climbed 37.9%, coal rose 20.9%, ferrous metals were up 24.8% and gasoline climbed 10.8%.
The Reserve Bank of Australia increased its inflation forecasts for this year, noting underlying CPI is to remain above its target band until late 2010 at the earliest, dampening expectations interest rates could fall from their current 12-year high of 7.25% any time soon.
Thursday, May 08, 2008
Obama
5/7/08 Obama
Obama's quest to clinch the Democratic nomination got a lift with a double-digit win in North Carolina and a strong run in Indiana, where he beat expectations. His ability to narrow Clinton's lead in Indiana, where she was heavily favored, reassured party leaders that he has weathered weeks of controversies. Only six state primaries remain. Obama is 184.5 delegates shy of the 2,025 needed to secure the Democratic nomination. The Obama campaign said North Carolina Democratic Party Chairman Jerry Meek, North Carolina Democratic National Committee member Jeanette Council, California DNC member Inola Henry, and Virginia's Jennifer McClellan, a former Clinton supporter, have pledged to endorse Obama, according to the AP.
The dollar climbed against the euro and the yen after Federal Reserve Bank of Kansas City President Thomas Hoenig said ``serious'' inflation pressures may prompt the central bank to raise interest rates and retail sales in Europe dropped by a record in March.
Vallejo, California's city council voted to go into bankruptcy, saying the city doesn't have enough money to pay its bills after talks with labor unions failed to win salary concessions from fire fighters and police.
Petroleo Brasileiro SA, Brazil's state- controlled oil company, plans to add 14,000 engineers, geologists and drillers within three years as it develops the biggest crude discovery in the Western Hemisphere since 1976.
According to Bloomberg, Countrywide is pulling home equity loans in Las Vegas.
Toyota Motor Corp.is raising its prices on some U.S. models later this month amid increased worries about its profit growth in the American market. The price increases, which will start in the middle of May, include a hike of $200 on the 2008 Yaris sedan, which will cost $12,425. The 2009 Camry will go up $200 to $18,920, the automaker's U.S. unit said in a statement released Friday. The hybrid Camry, introduced as a 2007 model in late 2006, will cost $300 more, at $25,650, Toyota said.
Productivity, a measure of efficiency, rose at a 2.2 percent annual rate after a 1.8 percent gain the fourth quarter, the Labor Department said today in Washington. Labor costs climbed at a 2.2 percent pace, down from a 2.8 percent increase in the last three months of 2007. Slowing sales and soaring expenses for raw materials like fuel prompted companies to trim staff hours by the most in five years last quarter.
Silver prices could approach an average $17 per ounce this year against $13.38 in 2007 as the weak dollar, inflation fears and increased investor interest in commodities fuel buying of the white metal, GFMS said. Speaking as the metals consultancy publishes its 2008 World Silver Survey in conjunction with the Silver Institute, GFMS Chairman Philip Klapwijk told Thomson Financial News: "We definitely expect silver to gain on its 2007 average year-on-year." Investment demand has surged in recent years, the report says, and that "the key development changing silver's fortune has been the pronounced shift in investor behaviour". While rising mine supply and the prospect of falling industrial consumption of the metal if the United States falls into recession could pressure the balance of supply and demand, investment interest should be sufficient to underpin the market, it says.
Transocean Inc., the world's largest offshore drilling contractor, said Wednesday its first-quarter earnings more than doubled, mostly boosted by sales from its acquired competitor GlobalSantaFe Corp.
France reported a record trade deficit for March.
For the three months ended March 31, 2008, WCI reported a net loss of $84.1 million, compared with a net loss of $15.8 million in the first quarter of 2007, while diluted earnings per share (EPS) declined to a loss of $2.00 versus a loss of $0.38 in the same period a year ago. Revenues for the first quarter of 2008 were $137.1 million, compared with $338.2 million for the first quarter of 2007, a 59.5% decrease. The aggregate number of gross new Traditional and Tower Homebuilding orders increased by 6% to 335; however, the aggregate number of net new orders for the quarter declined 22.8% to 183, as contract cancellations and defaults at closing continued at higher than long-term historical rates. The aggregate value of the net new orders for the quarter fell 49.8% over the same period a year ago to $78.3 million.``We experienced a sequential lift in traffic and new orders during the first quarter in Florida reflecting seasonal patterns, but saw a dramatic drop in traffic and new orders in the Northeast and Mid-Atlantic,'' said Jerry Starkey, President and CEO. ``In Florida we wrote 97 new orders for Tower units compared to only 11 during the same quarter last year, but in most instances the prices were significantly discounted. Even with the sequential increase, Traditional Homebuilding gross and net orders in Florida were down 5.6% and 21.0% year-over-year. Over ninety percent of our Florida Traditional Homebuilding new orders were spec sales, with very few purchasers paying the premium for ''to-be-built`` homes,'' Starkey continued. ``Beyond the seasonal lift in Florida, there are no signs that demand has firmed -- many potential purchasers continue to sit on the sidelines afraid of falling prices and the direction of the economy. Our primary focus continues to be on reducing costs and generating cash to pay down debt.''
An index of sales contracts on previously owned U.S. homes fell 1.0% in March from the prior month, the National Association of Realtors reported Wednesday. The index, which is considered a leading indicator of existing home sales, was down 20.1% from the March 2007 level. By region, March's pending home sales index rose only in the Northeast, with a 12.5% gain. The index declined 10.4% in the Midwest, 1.4% in the West and 0.1% in the South. February's level was revised to a decline of 2.8% from a prior estimate of a 1.9% drop.
Robert McHugh: "Oil set another new all-time high Tuesday, closing at 121.84. Trannies weren't bothered one bit, and you have to wonder what will it take to shake the Trannies, 1,000 a barrel oil? Crazy times.
Tomorrow is the start of our phi mate turn date window and Fibonacci turn window. The Industrials closed very close Tuesday to the high for the recent rally, so another up day tomorrow could get us the closing high that the coming phi mate turn is looking for. A top in equities should arrive over the next week or so...Wednesday's 200 point plunge in the Dow Industrials surely suggests the top is in and wave iii down has started. We have been suggesting for the past few weeks that we expected a top this week, and that appears to be the case. Key now is to watch the quality of the decline. Should new lows arrive, below the January lows, this stock market is in deep trouble, with a downside target below 10,000 for the Industrials. Wednesday also saw the large price move that Friday's small move in the McClellan Oscillator was suggesting would arrive within a few days."
New York Senator Clinton gave her campaign $5 million on April 11, $1 million on May 1 and $425,000 on May 5, spokesman Howard Wolfson said in an e-mail.
Crude supplies rose 5.7 million barrels to 325.6 million for the week ended May 2, according to the Energy Department Wednesday. Motor gasoline supplies climbed 800,000 barrels to 211.9 million barrels. Distillate stocks were down 100,000 barrels at 105.7 million barrels. Refinery utilization fell to 85.0% of capacity from 85.4% a week ago. The Energy Department's Energy Information Administration said in a weekly report that distillate fuels, which include diesel and heating oil, fell unexpectedly while gasoline demand rose slightly last week. Traders chose to focus on those numbers and shrug off crude inventories, which rose much more than analysts predicted, and gasoline supplies, which increased when analysts forecast a decline. Oil futures extended their seemingly relentless advance Wednesday, rising to a new record near $124 a barrel.
The Dow Jones Industrial Average fell 206.48 points, or 1.6%, to end at 12,814.35. The S&P 500 dropped 25.69 points, or 1.8%, to 1,392.57, while the Nasdaq Composite shed 44.82 points, or 1.8%, to 2,438.49.
U.S. consumers took on more debt of all types in March, the Federal Reserve reported Wednesday. Total seasonally adjusted consumer debt increased by $15.2 billion, or a 7.2% annual rate, in March to $2.56 trillion. This is the fastest pace of credit expansion since November.
June gold closed at $871.20 an ounce Wednesday, down $6.50 for the session.
Obama's quest to clinch the Democratic nomination got a lift with a double-digit win in North Carolina and a strong run in Indiana, where he beat expectations. His ability to narrow Clinton's lead in Indiana, where she was heavily favored, reassured party leaders that he has weathered weeks of controversies. Only six state primaries remain. Obama is 184.5 delegates shy of the 2,025 needed to secure the Democratic nomination. The Obama campaign said North Carolina Democratic Party Chairman Jerry Meek, North Carolina Democratic National Committee member Jeanette Council, California DNC member Inola Henry, and Virginia's Jennifer McClellan, a former Clinton supporter, have pledged to endorse Obama, according to the AP.
The dollar climbed against the euro and the yen after Federal Reserve Bank of Kansas City President Thomas Hoenig said ``serious'' inflation pressures may prompt the central bank to raise interest rates and retail sales in Europe dropped by a record in March.
Vallejo, California's city council voted to go into bankruptcy, saying the city doesn't have enough money to pay its bills after talks with labor unions failed to win salary concessions from fire fighters and police.
Petroleo Brasileiro SA, Brazil's state- controlled oil company, plans to add 14,000 engineers, geologists and drillers within three years as it develops the biggest crude discovery in the Western Hemisphere since 1976.
According to Bloomberg, Countrywide is pulling home equity loans in Las Vegas.
Toyota Motor Corp.is raising its prices on some U.S. models later this month amid increased worries about its profit growth in the American market. The price increases, which will start in the middle of May, include a hike of $200 on the 2008 Yaris sedan, which will cost $12,425. The 2009 Camry will go up $200 to $18,920, the automaker's U.S. unit said in a statement released Friday. The hybrid Camry, introduced as a 2007 model in late 2006, will cost $300 more, at $25,650, Toyota said.
Productivity, a measure of efficiency, rose at a 2.2 percent annual rate after a 1.8 percent gain the fourth quarter, the Labor Department said today in Washington. Labor costs climbed at a 2.2 percent pace, down from a 2.8 percent increase in the last three months of 2007. Slowing sales and soaring expenses for raw materials like fuel prompted companies to trim staff hours by the most in five years last quarter.
Silver prices could approach an average $17 per ounce this year against $13.38 in 2007 as the weak dollar, inflation fears and increased investor interest in commodities fuel buying of the white metal, GFMS said. Speaking as the metals consultancy publishes its 2008 World Silver Survey in conjunction with the Silver Institute, GFMS Chairman Philip Klapwijk told Thomson Financial News: "We definitely expect silver to gain on its 2007 average year-on-year." Investment demand has surged in recent years, the report says, and that "the key development changing silver's fortune has been the pronounced shift in investor behaviour". While rising mine supply and the prospect of falling industrial consumption of the metal if the United States falls into recession could pressure the balance of supply and demand, investment interest should be sufficient to underpin the market, it says.
Transocean Inc., the world's largest offshore drilling contractor, said Wednesday its first-quarter earnings more than doubled, mostly boosted by sales from its acquired competitor GlobalSantaFe Corp.
France reported a record trade deficit for March.
For the three months ended March 31, 2008, WCI reported a net loss of $84.1 million, compared with a net loss of $15.8 million in the first quarter of 2007, while diluted earnings per share (EPS) declined to a loss of $2.00 versus a loss of $0.38 in the same period a year ago. Revenues for the first quarter of 2008 were $137.1 million, compared with $338.2 million for the first quarter of 2007, a 59.5% decrease. The aggregate number of gross new Traditional and Tower Homebuilding orders increased by 6% to 335; however, the aggregate number of net new orders for the quarter declined 22.8% to 183, as contract cancellations and defaults at closing continued at higher than long-term historical rates. The aggregate value of the net new orders for the quarter fell 49.8% over the same period a year ago to $78.3 million.``We experienced a sequential lift in traffic and new orders during the first quarter in Florida reflecting seasonal patterns, but saw a dramatic drop in traffic and new orders in the Northeast and Mid-Atlantic,'' said Jerry Starkey, President and CEO. ``In Florida we wrote 97 new orders for Tower units compared to only 11 during the same quarter last year, but in most instances the prices were significantly discounted. Even with the sequential increase, Traditional Homebuilding gross and net orders in Florida were down 5.6% and 21.0% year-over-year. Over ninety percent of our Florida Traditional Homebuilding new orders were spec sales, with very few purchasers paying the premium for ''to-be-built`` homes,'' Starkey continued. ``Beyond the seasonal lift in Florida, there are no signs that demand has firmed -- many potential purchasers continue to sit on the sidelines afraid of falling prices and the direction of the economy. Our primary focus continues to be on reducing costs and generating cash to pay down debt.''
An index of sales contracts on previously owned U.S. homes fell 1.0% in March from the prior month, the National Association of Realtors reported Wednesday. The index, which is considered a leading indicator of existing home sales, was down 20.1% from the March 2007 level. By region, March's pending home sales index rose only in the Northeast, with a 12.5% gain. The index declined 10.4% in the Midwest, 1.4% in the West and 0.1% in the South. February's level was revised to a decline of 2.8% from a prior estimate of a 1.9% drop.
Robert McHugh: "Oil set another new all-time high Tuesday, closing at 121.84. Trannies weren't bothered one bit, and you have to wonder what will it take to shake the Trannies, 1,000 a barrel oil? Crazy times.
Tomorrow is the start of our phi mate turn date window and Fibonacci turn window. The Industrials closed very close Tuesday to the high for the recent rally, so another up day tomorrow could get us the closing high that the coming phi mate turn is looking for. A top in equities should arrive over the next week or so...Wednesday's 200 point plunge in the Dow Industrials surely suggests the top is in and wave iii down has started. We have been suggesting for the past few weeks that we expected a top this week, and that appears to be the case. Key now is to watch the quality of the decline. Should new lows arrive, below the January lows, this stock market is in deep trouble, with a downside target below 10,000 for the Industrials. Wednesday also saw the large price move that Friday's small move in the McClellan Oscillator was suggesting would arrive within a few days."
New York Senator Clinton gave her campaign $5 million on April 11, $1 million on May 1 and $425,000 on May 5, spokesman Howard Wolfson said in an e-mail.
Crude supplies rose 5.7 million barrels to 325.6 million for the week ended May 2, according to the Energy Department Wednesday. Motor gasoline supplies climbed 800,000 barrels to 211.9 million barrels. Distillate stocks were down 100,000 barrels at 105.7 million barrels. Refinery utilization fell to 85.0% of capacity from 85.4% a week ago. The Energy Department's Energy Information Administration said in a weekly report that distillate fuels, which include diesel and heating oil, fell unexpectedly while gasoline demand rose slightly last week. Traders chose to focus on those numbers and shrug off crude inventories, which rose much more than analysts predicted, and gasoline supplies, which increased when analysts forecast a decline. Oil futures extended their seemingly relentless advance Wednesday, rising to a new record near $124 a barrel.
The Dow Jones Industrial Average fell 206.48 points, or 1.6%, to end at 12,814.35. The S&P 500 dropped 25.69 points, or 1.8%, to 1,392.57, while the Nasdaq Composite shed 44.82 points, or 1.8%, to 2,438.49.
U.S. consumers took on more debt of all types in March, the Federal Reserve reported Wednesday. Total seasonally adjusted consumer debt increased by $15.2 billion, or a 7.2% annual rate, in March to $2.56 trillion. This is the fastest pace of credit expansion since November.
June gold closed at $871.20 an ounce Wednesday, down $6.50 for the session.
Obama
5/7/08 Obama
Obama's quest to clinch the Democratic nomination got a lift with a double-digit win in North Carolina and a strong run in Indiana, where he beat expectations. His ability to narrow Clinton's lead in Indiana, where she was heavily favored, reassured party leaders that he has weathered weeks of controversies. Only six state primaries remain. Obama is 184.5 delegates shy of the 2,025 needed to secure the Democratic nomination. The Obama campaign said North Carolina Democratic Party Chairman Jerry Meek, North Carolina Democratic National Committee member Jeanette Council, California DNC member Inola Henry, and Virginia's Jennifer McClellan, a former Clinton supporter, have pledged to endorse Obama, according to the AP.
The dollar climbed against the euro and the yen after Federal Reserve Bank of Kansas City President Thomas Hoenig said ``serious'' inflation pressures may prompt the central bank to raise interest rates and retail sales in Europe dropped by a record in March.
Vallejo, California's city council voted to go into bankruptcy, saying the city doesn't have enough money to pay its bills after talks with labor unions failed to win salary concessions from fire fighters and police.
Petroleo Brasileiro SA, Brazil's state- controlled oil company, plans to add 14,000 engineers, geologists and drillers within three years as it develops the biggest crude discovery in the Western Hemisphere since 1976.
According to Bloomberg, Countrywide is pulling home equity loans in Las Vegas.
Toyota Motor Corp.is raising its prices on some U.S. models later this month amid increased worries about its profit growth in the American market. The price increases, which will start in the middle of May, include a hike of $200 on the 2008 Yaris sedan, which will cost $12,425. The 2009 Camry will go up $200 to $18,920, the automaker's U.S. unit said in a statement released Friday. The hybrid Camry, introduced as a 2007 model in late 2006, will cost $300 more, at $25,650, Toyota said.
Productivity, a measure of efficiency, rose at a 2.2 percent annual rate after a 1.8 percent gain the fourth quarter, the Labor Department said today in Washington. Labor costs climbed at a 2.2 percent pace, down from a 2.8 percent increase in the last three months of 2007. Slowing sales and soaring expenses for raw materials like fuel prompted companies to trim staff hours by the most in five years last quarter.
Silver prices could approach an average $17 per ounce this year against $13.38 in 2007 as the weak dollar, inflation fears and increased investor interest in commodities fuel buying of the white metal, GFMS said. Speaking as the metals consultancy publishes its 2008 World Silver Survey in conjunction with the Silver Institute, GFMS Chairman Philip Klapwijk told Thomson Financial News: "We definitely expect silver to gain on its 2007 average year-on-year." Investment demand has surged in recent years, the report says, and that "the key development changing silver's fortune has been the pronounced shift in investor behaviour". While rising mine supply and the prospect of falling industrial consumption of the metal if the United States falls into recession could pressure the balance of supply and demand, investment interest should be sufficient to underpin the market, it says.
Transocean Inc., the world's largest offshore drilling contractor, said Wednesday its first-quarter earnings more than doubled, mostly boosted by sales from its acquired competitor GlobalSantaFe Corp.
France reported a record trade deficit for March.
For the three months ended March 31, 2008, WCI reported a net loss of $84.1 million, compared with a net loss of $15.8 million in the first quarter of 2007, while diluted earnings per share (EPS) declined to a loss of $2.00 versus a loss of $0.38 in the same period a year ago. Revenues for the first quarter of 2008 were $137.1 million, compared with $338.2 million for the first quarter of 2007, a 59.5% decrease. The aggregate number of gross new Traditional and Tower Homebuilding orders increased by 6% to 335; however, the aggregate number of net new orders for the quarter declined 22.8% to 183, as contract cancellations and defaults at closing continued at higher than long-term historical rates. The aggregate value of the net new orders for the quarter fell 49.8% over the same period a year ago to $78.3 million.``We experienced a sequential lift in traffic and new orders during the first quarter in Florida reflecting seasonal patterns, but saw a dramatic drop in traffic and new orders in the Northeast and Mid-Atlantic,'' said Jerry Starkey, President and CEO. ``In Florida we wrote 97 new orders for Tower units compared to only 11 during the same quarter last year, but in most instances the prices were significantly discounted. Even with the sequential increase, Traditional Homebuilding gross and net orders in Florida were down 5.6% and 21.0% year-over-year. Over ninety percent of our Florida Traditional Homebuilding new orders were spec sales, with very few purchasers paying the premium for ''to-be-built`` homes,'' Starkey continued. ``Beyond the seasonal lift in Florida, there are no signs that demand has firmed -- many potential purchasers continue to sit on the sidelines afraid of falling prices and the direction of the economy. Our primary focus continues to be on reducing costs and generating cash to pay down debt.''
An index of sales contracts on previously owned U.S. homes fell 1.0% in March from the prior month, the National Association of Realtors reported Wednesday. The index, which is considered a leading indicator of existing home sales, was down 20.1% from the March 2007 level. By region, March's pending home sales index rose only in the Northeast, with a 12.5% gain. The index declined 10.4% in the Midwest, 1.4% in the West and 0.1% in the South. February's level was revised to a decline of 2.8% from a prior estimate of a 1.9% drop.
Robert McHugh: "Oil set another new all-time high Tuesday, closing at 121.84. Trannies weren't bothered one bit, and you have to wonder what will it take to shake the Trannies, 1,000 a barrel oil? Crazy times.
Tomorrow is the start of our phi mate turn date window and Fibonacci turn window. The Industrials closed very close Tuesday to the high for the recent rally, so another up day tomorrow could get us the closing high that the coming phi mate turn is looking for. A top in equities should arrive over the next week or so...Wednesday's 200 point plunge in the Dow Industrials surely suggests the top is in and wave iii down has started. We have been suggesting for the past few weeks that we expected a top this week, and that appears to be the case. Key now is to watch the quality of the decline. Should new lows arrive, below the January lows, this stock market is in deep trouble, with a downside target below 10,000 for the Industrials. Wednesday also saw the large price move that Friday's small move in the McClellan Oscillator was suggesting would arrive within a few days."
New York Senator Clinton gave her campaign $5 million on April 11, $1 million on May 1 and $425,000 on May 5, spokesman Howard Wolfson said in an e-mail.
Crude supplies rose 5.7 million barrels to 325.6 million for the week ended May 2, according to the Energy Department Wednesday. Motor gasoline supplies climbed 800,000 barrels to 211.9 million barrels. Distillate stocks were down 100,000 barrels at 105.7 million barrels. Refinery utilization fell to 85.0% of capacity from 85.4% a week ago. The Energy Department's Energy Information Administration said in a weekly report that distillate fuels, which include diesel and heating oil, fell unexpectedly while gasoline demand rose slightly last week. Traders chose to focus on those numbers and shrug off crude inventories, which rose much more than analysts predicted, and gasoline supplies, which increased when analysts forecast a decline. Oil futures extended their seemingly relentless advance Wednesday, rising to a new record near $124 a barrel.
The Dow Jones Industrial Average fell 206.48 points, or 1.6%, to end at 12,814.35. The S&P 500 dropped 25.69 points, or 1.8%, to 1,392.57, while the Nasdaq Composite shed 44.82 points, or 1.8%, to 2,438.49.
U.S. consumers took on more debt of all types in March, the Federal Reserve reported Wednesday. Total seasonally adjusted consumer debt increased by $15.2 billion, or a 7.2% annual rate, in March to $2.56 trillion. This is the fastest pace of credit expansion since November.
June gold closed at $871.20 an ounce Wednesday, down $6.50 for the session.
Obama's quest to clinch the Democratic nomination got a lift with a double-digit win in North Carolina and a strong run in Indiana, where he beat expectations. His ability to narrow Clinton's lead in Indiana, where she was heavily favored, reassured party leaders that he has weathered weeks of controversies. Only six state primaries remain. Obama is 184.5 delegates shy of the 2,025 needed to secure the Democratic nomination. The Obama campaign said North Carolina Democratic Party Chairman Jerry Meek, North Carolina Democratic National Committee member Jeanette Council, California DNC member Inola Henry, and Virginia's Jennifer McClellan, a former Clinton supporter, have pledged to endorse Obama, according to the AP.
The dollar climbed against the euro and the yen after Federal Reserve Bank of Kansas City President Thomas Hoenig said ``serious'' inflation pressures may prompt the central bank to raise interest rates and retail sales in Europe dropped by a record in March.
Vallejo, California's city council voted to go into bankruptcy, saying the city doesn't have enough money to pay its bills after talks with labor unions failed to win salary concessions from fire fighters and police.
Petroleo Brasileiro SA, Brazil's state- controlled oil company, plans to add 14,000 engineers, geologists and drillers within three years as it develops the biggest crude discovery in the Western Hemisphere since 1976.
According to Bloomberg, Countrywide is pulling home equity loans in Las Vegas.
Toyota Motor Corp.is raising its prices on some U.S. models later this month amid increased worries about its profit growth in the American market. The price increases, which will start in the middle of May, include a hike of $200 on the 2008 Yaris sedan, which will cost $12,425. The 2009 Camry will go up $200 to $18,920, the automaker's U.S. unit said in a statement released Friday. The hybrid Camry, introduced as a 2007 model in late 2006, will cost $300 more, at $25,650, Toyota said.
Productivity, a measure of efficiency, rose at a 2.2 percent annual rate after a 1.8 percent gain the fourth quarter, the Labor Department said today in Washington. Labor costs climbed at a 2.2 percent pace, down from a 2.8 percent increase in the last three months of 2007. Slowing sales and soaring expenses for raw materials like fuel prompted companies to trim staff hours by the most in five years last quarter.
Silver prices could approach an average $17 per ounce this year against $13.38 in 2007 as the weak dollar, inflation fears and increased investor interest in commodities fuel buying of the white metal, GFMS said. Speaking as the metals consultancy publishes its 2008 World Silver Survey in conjunction with the Silver Institute, GFMS Chairman Philip Klapwijk told Thomson Financial News: "We definitely expect silver to gain on its 2007 average year-on-year." Investment demand has surged in recent years, the report says, and that "the key development changing silver's fortune has been the pronounced shift in investor behaviour". While rising mine supply and the prospect of falling industrial consumption of the metal if the United States falls into recession could pressure the balance of supply and demand, investment interest should be sufficient to underpin the market, it says.
Transocean Inc., the world's largest offshore drilling contractor, said Wednesday its first-quarter earnings more than doubled, mostly boosted by sales from its acquired competitor GlobalSantaFe Corp.
France reported a record trade deficit for March.
For the three months ended March 31, 2008, WCI reported a net loss of $84.1 million, compared with a net loss of $15.8 million in the first quarter of 2007, while diluted earnings per share (EPS) declined to a loss of $2.00 versus a loss of $0.38 in the same period a year ago. Revenues for the first quarter of 2008 were $137.1 million, compared with $338.2 million for the first quarter of 2007, a 59.5% decrease. The aggregate number of gross new Traditional and Tower Homebuilding orders increased by 6% to 335; however, the aggregate number of net new orders for the quarter declined 22.8% to 183, as contract cancellations and defaults at closing continued at higher than long-term historical rates. The aggregate value of the net new orders for the quarter fell 49.8% over the same period a year ago to $78.3 million.``We experienced a sequential lift in traffic and new orders during the first quarter in Florida reflecting seasonal patterns, but saw a dramatic drop in traffic and new orders in the Northeast and Mid-Atlantic,'' said Jerry Starkey, President and CEO. ``In Florida we wrote 97 new orders for Tower units compared to only 11 during the same quarter last year, but in most instances the prices were significantly discounted. Even with the sequential increase, Traditional Homebuilding gross and net orders in Florida were down 5.6% and 21.0% year-over-year. Over ninety percent of our Florida Traditional Homebuilding new orders were spec sales, with very few purchasers paying the premium for ''to-be-built`` homes,'' Starkey continued. ``Beyond the seasonal lift in Florida, there are no signs that demand has firmed -- many potential purchasers continue to sit on the sidelines afraid of falling prices and the direction of the economy. Our primary focus continues to be on reducing costs and generating cash to pay down debt.''
An index of sales contracts on previously owned U.S. homes fell 1.0% in March from the prior month, the National Association of Realtors reported Wednesday. The index, which is considered a leading indicator of existing home sales, was down 20.1% from the March 2007 level. By region, March's pending home sales index rose only in the Northeast, with a 12.5% gain. The index declined 10.4% in the Midwest, 1.4% in the West and 0.1% in the South. February's level was revised to a decline of 2.8% from a prior estimate of a 1.9% drop.
Robert McHugh: "Oil set another new all-time high Tuesday, closing at 121.84. Trannies weren't bothered one bit, and you have to wonder what will it take to shake the Trannies, 1,000 a barrel oil? Crazy times.
Tomorrow is the start of our phi mate turn date window and Fibonacci turn window. The Industrials closed very close Tuesday to the high for the recent rally, so another up day tomorrow could get us the closing high that the coming phi mate turn is looking for. A top in equities should arrive over the next week or so...Wednesday's 200 point plunge in the Dow Industrials surely suggests the top is in and wave iii down has started. We have been suggesting for the past few weeks that we expected a top this week, and that appears to be the case. Key now is to watch the quality of the decline. Should new lows arrive, below the January lows, this stock market is in deep trouble, with a downside target below 10,000 for the Industrials. Wednesday also saw the large price move that Friday's small move in the McClellan Oscillator was suggesting would arrive within a few days."
New York Senator Clinton gave her campaign $5 million on April 11, $1 million on May 1 and $425,000 on May 5, spokesman Howard Wolfson said in an e-mail.
Crude supplies rose 5.7 million barrels to 325.6 million for the week ended May 2, according to the Energy Department Wednesday. Motor gasoline supplies climbed 800,000 barrels to 211.9 million barrels. Distillate stocks were down 100,000 barrels at 105.7 million barrels. Refinery utilization fell to 85.0% of capacity from 85.4% a week ago. The Energy Department's Energy Information Administration said in a weekly report that distillate fuels, which include diesel and heating oil, fell unexpectedly while gasoline demand rose slightly last week. Traders chose to focus on those numbers and shrug off crude inventories, which rose much more than analysts predicted, and gasoline supplies, which increased when analysts forecast a decline. Oil futures extended their seemingly relentless advance Wednesday, rising to a new record near $124 a barrel.
The Dow Jones Industrial Average fell 206.48 points, or 1.6%, to end at 12,814.35. The S&P 500 dropped 25.69 points, or 1.8%, to 1,392.57, while the Nasdaq Composite shed 44.82 points, or 1.8%, to 2,438.49.
U.S. consumers took on more debt of all types in March, the Federal Reserve reported Wednesday. Total seasonally adjusted consumer debt increased by $15.2 billion, or a 7.2% annual rate, in March to $2.56 trillion. This is the fastest pace of credit expansion since November.
June gold closed at $871.20 an ounce Wednesday, down $6.50 for the session.
Wednesday, May 07, 2008
Liquidity Crunch
5/6/08 Liquidity Crunch
Nouriel Roubini: "The Fed is Getting Desperate in Dealing with a Liquidity Crunch that Shows Little Signs of Relenting."
U.S. business bankruptcy filings in April increased 49 percent from a year earlier, the biggest gain so far this year, as the slowing economy prompted more companies to shut down. Business filings rose to 5,173 during the month, according to statistics compiled from court records by Jupiter eSources LLC in Oklahoma City. Total bankruptcy filings, including those by individuals, were up 31 percent from a year earlier to 93,096, the group said.
Cisco Systems Inc reported third-quarter net income of $1.77 billion, or 29 cents a share, compared with net profit of $1.87 billion, or 30 cents a share, for the year-earlier period. Revenue was $9.79 billion, up from $8.87 billion. Adjusted income was 38 cents a share. Analysts expected Cisco to report earnings of 36 cents a share on revenue of $9.74 billion, according to a consensus survey by FactSet Research. John Chambers: "We're continuing to see our U.S. and some European customers remain cautious in their views about their own economies."
Legg Mason Inc. posted a bigger-than estimated loss, its first in 25 years as a public company, after pumping $517 million into money-market funds hurt by subprime mortgage-related investments.The fiscal fourth-quarter net loss was $255 million, or $1.81 a share, compared with a profit of $172.5 million, or $1.19 a share, a year earlier, the Baltimore-based fund manager said in a statement today. To replenish capital, Legg Mason said it plans to raise $1 billion by selling 20 million equity units, its second cash infusion in the past six months.
Fannie Mae reported a much greater-than-expected loss in the first quarter, losing $2.2 billion as credit-related expenses took a bite out of its bottom line, and said it's planning to raise $6 billion in new capital.
Yahoo's largest shareholders told CNBC they would support a move to replace the board, given they feel that board let them down during negotiations this weekend.
The dollar index was at 72.919, down from 73.190 in late North American trading Monday.
Wachovia Corp., the fourth-largest U.S. bank by assets, said it lost $708 million in the first quarter, 80 percent more than the lender reported last month, on writedowns on life insurance policies for employees.
D.R. Horton Inc.swung to a fiscal second-quarter loss of $1.31 billion, or $4.14 a share, from a year-earlier profit of $51.7 million, or 16 cents a share. The loss for the latest period included $834.1 million in pretax charges and write-offs related to inventory impairments. The Fort Worth, Texas, home builder said revenue for the period fell 38% to $1.62 billion from $2.62 billion. On average, analysts polled by Thomson Reuters expected a loss of 39 cents a share on revenue of $1.36 billion. D.R. Horton said it closed on 6,719 homes in the latest quarter, compared with 9,792 in the year-ago quarter.
Joy Global Inc. lowered its 2008 earnings target to $2.96 to $3.22 a share from its earlier view of $3.15 to $3.45 a share, but kept its revenue target unchanged at $3.1 billion to $3.3 billion.
Emerson Electric raised its 2008 earnings per share from continuing operations guidance to between $3.00 and $3.10 a share.
The Tropicana Entertainment LLC subsidiary of Tropicana Casinos & Resorts said late on Monday that it filed for protection from creditors under Chapter 11 of federal bankruptcy law.
Producer prices in the euro zone rose 0.7% in March compared with February, or 5.7% year-on-year. Excluding energy, annualized prices rose 3.7%.
UBS swung to a first-quarter net loss of 11.54 billion Swiss francs ($11 billion) after posting some $19 billion of losses tied to U.S. mortgages and related securities as well as other structured products. In the year-earlier quarter, UBS earned 3.03 billion francs. On April 1, UBS had estimated the latest quarter's loss at 12 billion francs. The loss per share was 5.63 francs compared with profit of 1.43 in the year-earlier period. UBS also said that by the end of 2008, it would pare 2,600 jobs at its investment bank, bringing the division's workforce to 19,000. And by mid-2009, it expects to have cut a total of 5,500 jobs overall.
Japanese petroleum companies are considering expanding their investments in Qatar to include the manufacture of petrochemicals, according to a Japanese media report.
General Electric Co. said Monday it would stop offering loans for the purchase of consumer boats and motor homes.
According to the Financial Times, Marius Kloppers, chief executive of BHP Billiton, will this week go on the offensive again in the takeover battle between the world’s biggest mining company and Rio Tinto, its target. He will use a briefing on Wednesday with investors and analysts about prospects for BHP’s oil and gas division to say that BHP can expand at least as rapidly as Rio over the next few years.
Australia Wheat Output May Increase 92%, Bank Says. Australia, the world’s second-biggest wheat exporter before two years of drought ravaged crops, may almost double its harvest this year as higher prices and better weather encourage planting, National Australia Bank Ltd. said.
Beazer Homes received a default notice from the Bank of New York Trust Company National Association on April 30, the homebuilder said in a regulatory filing Tuesday. The Bank of New York Trust Company National Association is the trustee under the indenture governing the company's $103.1 million unsecured junior subordinated notes due July 2036. The notice alleges that the company is in default because it has yet to provide certain required information, including its annual and quarterly financial statements. Beazer Homes expects to be able to cure this default by May 15, it said.
Sprint Nextel Corp.and Clearwire Corp.are said to be close to finalizing a $12 billion joint venture to roll out WiMax, an ultra-fast technology for wireless Internet access.
Walt Disney Co. said Tuesday that second-quarter net income was $1.13 billion, or 58 cents a share, compared with $931 million, or 44 cents a share, for the same period a year ago.
June crude closed at $121.84 a barrel Tuesday to mark the loftiest settlement price ever for crude futures. The contract finished the day up $1.87. June gold closed at $877.70 an ounce Tuesday in New York. Prices climbed $3.60 for the day to tally a three-session gain of $26.80.
Medtronic Inc. plans to cut about 1,100 positions, representing about 3% of its work force, over the next fiscal year, The Wall Street Journal reported.
Take-Two Interactive Software Inc.said its hotly anticipated video-game title "Grand Theft Auto IV" sold about 6 million units worldwide, with an estimated retail value of more than $500 million, in its first week of release.
Shanghai's Composite Index ended sharply lower Wednesday, shedding 4.1% amid worries the People's Bank of China will lift interest rates next week following the release of April consumer price data.
Jon Markman: "Short-term rallies and wishful thinking have buyers ready to pounce, but the end of the credit mess isn't yet here."
Nouriel Roubini: "The Fed is Getting Desperate in Dealing with a Liquidity Crunch that Shows Little Signs of Relenting."
U.S. business bankruptcy filings in April increased 49 percent from a year earlier, the biggest gain so far this year, as the slowing economy prompted more companies to shut down. Business filings rose to 5,173 during the month, according to statistics compiled from court records by Jupiter eSources LLC in Oklahoma City. Total bankruptcy filings, including those by individuals, were up 31 percent from a year earlier to 93,096, the group said.
Cisco Systems Inc reported third-quarter net income of $1.77 billion, or 29 cents a share, compared with net profit of $1.87 billion, or 30 cents a share, for the year-earlier period. Revenue was $9.79 billion, up from $8.87 billion. Adjusted income was 38 cents a share. Analysts expected Cisco to report earnings of 36 cents a share on revenue of $9.74 billion, according to a consensus survey by FactSet Research. John Chambers: "We're continuing to see our U.S. and some European customers remain cautious in their views about their own economies."
Legg Mason Inc. posted a bigger-than estimated loss, its first in 25 years as a public company, after pumping $517 million into money-market funds hurt by subprime mortgage-related investments.The fiscal fourth-quarter net loss was $255 million, or $1.81 a share, compared with a profit of $172.5 million, or $1.19 a share, a year earlier, the Baltimore-based fund manager said in a statement today. To replenish capital, Legg Mason said it plans to raise $1 billion by selling 20 million equity units, its second cash infusion in the past six months.
Fannie Mae reported a much greater-than-expected loss in the first quarter, losing $2.2 billion as credit-related expenses took a bite out of its bottom line, and said it's planning to raise $6 billion in new capital.
Yahoo's largest shareholders told CNBC they would support a move to replace the board, given they feel that board let them down during negotiations this weekend.
The dollar index was at 72.919, down from 73.190 in late North American trading Monday.
Wachovia Corp., the fourth-largest U.S. bank by assets, said it lost $708 million in the first quarter, 80 percent more than the lender reported last month, on writedowns on life insurance policies for employees.
D.R. Horton Inc.swung to a fiscal second-quarter loss of $1.31 billion, or $4.14 a share, from a year-earlier profit of $51.7 million, or 16 cents a share. The loss for the latest period included $834.1 million in pretax charges and write-offs related to inventory impairments. The Fort Worth, Texas, home builder said revenue for the period fell 38% to $1.62 billion from $2.62 billion. On average, analysts polled by Thomson Reuters expected a loss of 39 cents a share on revenue of $1.36 billion. D.R. Horton said it closed on 6,719 homes in the latest quarter, compared with 9,792 in the year-ago quarter.
Joy Global Inc. lowered its 2008 earnings target to $2.96 to $3.22 a share from its earlier view of $3.15 to $3.45 a share, but kept its revenue target unchanged at $3.1 billion to $3.3 billion.
Emerson Electric raised its 2008 earnings per share from continuing operations guidance to between $3.00 and $3.10 a share.
The Tropicana Entertainment LLC subsidiary of Tropicana Casinos & Resorts said late on Monday that it filed for protection from creditors under Chapter 11 of federal bankruptcy law.
Producer prices in the euro zone rose 0.7% in March compared with February, or 5.7% year-on-year. Excluding energy, annualized prices rose 3.7%.
UBS swung to a first-quarter net loss of 11.54 billion Swiss francs ($11 billion) after posting some $19 billion of losses tied to U.S. mortgages and related securities as well as other structured products. In the year-earlier quarter, UBS earned 3.03 billion francs. On April 1, UBS had estimated the latest quarter's loss at 12 billion francs. The loss per share was 5.63 francs compared with profit of 1.43 in the year-earlier period. UBS also said that by the end of 2008, it would pare 2,600 jobs at its investment bank, bringing the division's workforce to 19,000. And by mid-2009, it expects to have cut a total of 5,500 jobs overall.
Japanese petroleum companies are considering expanding their investments in Qatar to include the manufacture of petrochemicals, according to a Japanese media report.
General Electric Co. said Monday it would stop offering loans for the purchase of consumer boats and motor homes.
According to the Financial Times, Marius Kloppers, chief executive of BHP Billiton, will this week go on the offensive again in the takeover battle between the world’s biggest mining company and Rio Tinto, its target. He will use a briefing on Wednesday with investors and analysts about prospects for BHP’s oil and gas division to say that BHP can expand at least as rapidly as Rio over the next few years.
Australia Wheat Output May Increase 92%, Bank Says. Australia, the world’s second-biggest wheat exporter before two years of drought ravaged crops, may almost double its harvest this year as higher prices and better weather encourage planting, National Australia Bank Ltd. said.
Beazer Homes received a default notice from the Bank of New York Trust Company National Association on April 30, the homebuilder said in a regulatory filing Tuesday. The Bank of New York Trust Company National Association is the trustee under the indenture governing the company's $103.1 million unsecured junior subordinated notes due July 2036. The notice alleges that the company is in default because it has yet to provide certain required information, including its annual and quarterly financial statements. Beazer Homes expects to be able to cure this default by May 15, it said.
Sprint Nextel Corp.and Clearwire Corp.are said to be close to finalizing a $12 billion joint venture to roll out WiMax, an ultra-fast technology for wireless Internet access.
Walt Disney Co. said Tuesday that second-quarter net income was $1.13 billion, or 58 cents a share, compared with $931 million, or 44 cents a share, for the same period a year ago.
June crude closed at $121.84 a barrel Tuesday to mark the loftiest settlement price ever for crude futures. The contract finished the day up $1.87. June gold closed at $877.70 an ounce Tuesday in New York. Prices climbed $3.60 for the day to tally a three-session gain of $26.80.
Medtronic Inc. plans to cut about 1,100 positions, representing about 3% of its work force, over the next fiscal year, The Wall Street Journal reported.
Take-Two Interactive Software Inc.said its hotly anticipated video-game title "Grand Theft Auto IV" sold about 6 million units worldwide, with an estimated retail value of more than $500 million, in its first week of release.
Shanghai's Composite Index ended sharply lower Wednesday, shedding 4.1% amid worries the People's Bank of China will lift interest rates next week following the release of April consumer price data.
Jon Markman: "Short-term rallies and wishful thinking have buyers ready to pounce, but the end of the credit mess isn't yet here."
Monday, May 05, 2008
Yahoo
5/5/08 Yahoo
Yahoo shares traded at $22.61 in Frankfurt on Monday, after closing at $28.67 a share on Friday.
Hovnanian reached positive cash flow in the second quarter, one quarter earlier than it had hoped. And for fiscal 2008 it now sees that figure exceeding $300 million, compared with its earlier view of more than $100 million.
Bank of America Corp is likely to renegotiate its deal to buy Countrywide Financial Corp down to the $0 to $2 level or completely walk away from it, said Friedman, Billings, Ramsey, which downgraded Countrywide to "underperform" from "market perform."
Deutsche Telekom AG is considering a bid for Sprint Nextel Corp., according to a media report Monday.
The average price of self-serve regular gasoline on Friday was $3.62 a gallon, up 15 cents from two weeks ago. Mid-grade was at $3.74 and premium was $3.85. That's all according to the Lundberg Survey of 7,000 stations nationwide released Sunday. Regular gasoline is up 55 cents since 2008 began.
Wal-Mart Stores Inc.said it's adding 90-day prescriptions for $10, increasing additional medications for women and unveiling $4 over the counter medicines.
The cyclone and flooding in Myanmar's two major rice growing areas have "potentially serious effects" for food supply in two other impoverished countries, a U.N. official said on Monday.World Food Program spokesman Paul Risley said it was not yet known whether Myanmar could meet its commitments to supply tens of thousands of tons of rice to Sri Lanka and neighbouring Bangladesh.
Berkshire's Charlie Munger: "You can take Warren’s promises to bank. We are happy making money at lower rate in future, and we suggest you adopt the same attitude. You may have better things to do with your money than buying Berkshire. You will find things that are more intelligent, if you spend the time. We don’t think it is the most attractive investment in world. We like buying good size to very large with good management. Nice formula, it should work well over time."
Brett Steenbarger: "Fed funds futures pricing in a full 1% *rise* in rates into summer 2009, expecting that Fed will be fighting inflation."
According to Bloomberg, UBS AG may cut as many as 8,000 jobs as it grapples with the biggest credit writedowns of any European bank and a 12 billion-franc ($11.4 billion) first-quarter loss.
John Hussman: "Investors really have no sense of market dynamics if they believe that a recession-linked bear market comprises a single decline of less than 20% followed by a “V” shaped rebound into a new bull market...While I don't expect the market's losses to be nearly as severe as they were in the 2000-2002 bear market, the simple fact is that if the recent market low was indeed a final bear market trough, it occurred at the highest valuation level of any prior bear market trough in history."
Andrew Cockburn: "Six weeks ago, President Bush signed a secret finding authorizing a covert offensive against the Iranian regime that, according to those familiar with its contents, "unprecedented in its scope." Bush’s secret directive covers actions across a huge geographic area – from Lebanon to Afghanistan – but is also far more sweeping in the type of actions permitted under its guidelines – up to and including the assassination of targeted officials. This widened scope clears the way, for example, for full support for the military arm of Mujahedin-e Khalq, the cultish Iranian opposition group, despite its enduring position on the State Department's list of terrorist groups...Interestingly, despite the bellicose complaints, Petraeus has made little effort to seal the Iran-Iraq border, and in any case two thirds of U.S. casualties still come from Sunni insurgents. "The Shia account for less than one third," a recently returned member of the command staff in Baghdad familiar with the relevant intelligence told me, "but if you want a war you have to sell it."
European Central Bank president Jean-Claude Trichet said Monday that inflationary risks are significant, according to Dow Jones Newswires. The ECB chief made the remarks after a meeting of the Bank for International Settlements. "There is no time for complacency for central banks in any respect," Trichet said, according to the news service.
Nigeria's rebel group MEND said Sunday it was responsible for an attack on Shell facilities in the south of the country, according to media reports. Shell confirmed the attack and said that some oil production had been closed down, according to reports.
U.S. April ISM services index 52.0% vs 49.6 March.
First Marblehead cuts 500 jobs to lower operating expenses.
Nouriel Roubini: "So auto sales are free falling and desperate car makers are cutting on prices and providing further price cuts via loose financing terms. But at the same time a time bomb of negative equity in auto loans is emerging. For the last few years auto loan lenders sharply loosened their lending standards, used aggressive, deceptive and predatory lending practices, allowed households to buy cars with little equity in them (as zero down-payment deals became the norm) and thus caused a bubble in car production and in car sales (individuals with cars too big and too many cars each) that was financed with a reckless lending bubble. Sounds familiar? The car lending bubble was as reckless as the subprime and mortgage bubble. And now this credit bubble is going bust leading to rising default rates, significant negative equity in car loans (25% of all car loans are “under water”), massive losses to auto loan firms and a severe recession in the auto industry."
Prices of coking coal, a steel-making raw material, will stay at records next year because of rising demand for the alloy and as higher costs delayed the construction of new mines, according to Macquarie Bank Ltd. The price of hard coking coal may remain at $300 a metric ton for the year starting April 1, 2009, up 67 percent from a previous estimate.
Crude oil futures surged nearly $4 Monday to above $120 a barrel for the first time on concerns about supply disruptions in Nigeria and weakness in the U.S. dollar.
June crude closed at $119.97 a barrel on the New York Mercantile Exchange, up $3.65, or 3.1%, for the session.
The Federal Reserve said Monday it will auction $75 billion of 28-day loans at a minimum bid rate of 2.00% under its term auction facility.
Merck & Co. will cut U.S. sales force by 1,200 positions.
June gold closed at $874.10 an ounce Monday. The contract gained $16.10, or 1.9%, for the session. July silver finished at $16.83 an ounce, up 36 cents.
Yahoo shares traded at $22.61 in Frankfurt on Monday, after closing at $28.67 a share on Friday.
Hovnanian reached positive cash flow in the second quarter, one quarter earlier than it had hoped. And for fiscal 2008 it now sees that figure exceeding $300 million, compared with its earlier view of more than $100 million.
Bank of America Corp is likely to renegotiate its deal to buy Countrywide Financial Corp down to the $0 to $2 level or completely walk away from it, said Friedman, Billings, Ramsey, which downgraded Countrywide to "underperform" from "market perform."
Deutsche Telekom AG is considering a bid for Sprint Nextel Corp., according to a media report Monday.
The average price of self-serve regular gasoline on Friday was $3.62 a gallon, up 15 cents from two weeks ago. Mid-grade was at $3.74 and premium was $3.85. That's all according to the Lundberg Survey of 7,000 stations nationwide released Sunday. Regular gasoline is up 55 cents since 2008 began.
Wal-Mart Stores Inc.said it's adding 90-day prescriptions for $10, increasing additional medications for women and unveiling $4 over the counter medicines.
The cyclone and flooding in Myanmar's two major rice growing areas have "potentially serious effects" for food supply in two other impoverished countries, a U.N. official said on Monday.World Food Program spokesman Paul Risley said it was not yet known whether Myanmar could meet its commitments to supply tens of thousands of tons of rice to Sri Lanka and neighbouring Bangladesh.
Berkshire's Charlie Munger: "You can take Warren’s promises to bank. We are happy making money at lower rate in future, and we suggest you adopt the same attitude. You may have better things to do with your money than buying Berkshire. You will find things that are more intelligent, if you spend the time. We don’t think it is the most attractive investment in world. We like buying good size to very large with good management. Nice formula, it should work well over time."
Brett Steenbarger: "Fed funds futures pricing in a full 1% *rise* in rates into summer 2009, expecting that Fed will be fighting inflation."
According to Bloomberg, UBS AG may cut as many as 8,000 jobs as it grapples with the biggest credit writedowns of any European bank and a 12 billion-franc ($11.4 billion) first-quarter loss.
John Hussman: "Investors really have no sense of market dynamics if they believe that a recession-linked bear market comprises a single decline of less than 20% followed by a “V” shaped rebound into a new bull market...While I don't expect the market's losses to be nearly as severe as they were in the 2000-2002 bear market, the simple fact is that if the recent market low was indeed a final bear market trough, it occurred at the highest valuation level of any prior bear market trough in history."
Andrew Cockburn: "Six weeks ago, President Bush signed a secret finding authorizing a covert offensive against the Iranian regime that, according to those familiar with its contents, "unprecedented in its scope." Bush’s secret directive covers actions across a huge geographic area – from Lebanon to Afghanistan – but is also far more sweeping in the type of actions permitted under its guidelines – up to and including the assassination of targeted officials. This widened scope clears the way, for example, for full support for the military arm of Mujahedin-e Khalq, the cultish Iranian opposition group, despite its enduring position on the State Department's list of terrorist groups...Interestingly, despite the bellicose complaints, Petraeus has made little effort to seal the Iran-Iraq border, and in any case two thirds of U.S. casualties still come from Sunni insurgents. "The Shia account for less than one third," a recently returned member of the command staff in Baghdad familiar with the relevant intelligence told me, "but if you want a war you have to sell it."
European Central Bank president Jean-Claude Trichet said Monday that inflationary risks are significant, according to Dow Jones Newswires. The ECB chief made the remarks after a meeting of the Bank for International Settlements. "There is no time for complacency for central banks in any respect," Trichet said, according to the news service.
Nigeria's rebel group MEND said Sunday it was responsible for an attack on Shell facilities in the south of the country, according to media reports. Shell confirmed the attack and said that some oil production had been closed down, according to reports.
U.S. April ISM services index 52.0% vs 49.6 March.
First Marblehead cuts 500 jobs to lower operating expenses.
Nouriel Roubini: "So auto sales are free falling and desperate car makers are cutting on prices and providing further price cuts via loose financing terms. But at the same time a time bomb of negative equity in auto loans is emerging. For the last few years auto loan lenders sharply loosened their lending standards, used aggressive, deceptive and predatory lending practices, allowed households to buy cars with little equity in them (as zero down-payment deals became the norm) and thus caused a bubble in car production and in car sales (individuals with cars too big and too many cars each) that was financed with a reckless lending bubble. Sounds familiar? The car lending bubble was as reckless as the subprime and mortgage bubble. And now this credit bubble is going bust leading to rising default rates, significant negative equity in car loans (25% of all car loans are “under water”), massive losses to auto loan firms and a severe recession in the auto industry."
Prices of coking coal, a steel-making raw material, will stay at records next year because of rising demand for the alloy and as higher costs delayed the construction of new mines, according to Macquarie Bank Ltd. The price of hard coking coal may remain at $300 a metric ton for the year starting April 1, 2009, up 67 percent from a previous estimate.
Crude oil futures surged nearly $4 Monday to above $120 a barrel for the first time on concerns about supply disruptions in Nigeria and weakness in the U.S. dollar.
June crude closed at $119.97 a barrel on the New York Mercantile Exchange, up $3.65, or 3.1%, for the session.
The Federal Reserve said Monday it will auction $75 billion of 28-day loans at a minimum bid rate of 2.00% under its term auction facility.
Merck & Co. will cut U.S. sales force by 1,200 positions.
June gold closed at $874.10 an ounce Monday. The contract gained $16.10, or 1.9%, for the session. July silver finished at $16.83 an ounce, up 36 cents.
Microsoft and Yahoo
5/4/08 Microsoft and Yahoo
Microsoft Corp. said late Saturday it was withdrawing its bid to acquire Yahoo Inc. Steve Ballmer, CEO of the Redmond-Wash.-based software giant, said the company continued to believe its proposal made sense for both companies, but that "the economics demanded by Yahoo do not make sense for us." In a letter to Yahoo CEO Jerry Yang, Ballmer said he was "disappointed that Yahoo has not moved toward accepting our offer," formally ended negotiations after three months. Yahoo chairman Roy Bostock said the company has remained "steadfast in our belief that Microsoft's offer undervalued the company and we are pleased that so many of our shareholders joined us in expressing that view."
In my view, the market sets the value for a company. When was the last time Yahoo traded at $37? Yahoo continues to lose market share and their ability to grow on a consistently profitable basis has not been proven. Yahoo has 500 million users and has had extreme difficulty in monetizing those users. ``Unbelievable,'' said Laura Martin, an analyst at New York- based Soleil Securities Corp. ``This is management putting its employees and its job security ahead of current Yahoo shareholders' interest.'' ``The shareholders will wake up tomorrow morning or tonight and say `Jerry, what are you doing?''' RBC Capital Markets analyst Robert Breza in Minneapolis said yesterday. ``They weren't doing the best job, and Microsoft put a fair offer on the table. And for them to up the bid and for these guys to not want to engage -- I think Microsoft's being smart here.''
Google outsold Microsoft in Web ads 7-to-1 in its last fiscal year and handles six times as many search queries in the U.S., according to ComScore Inc. in Reston, Virginia.
JPMorgan Chase & Co does not expect the U.S. financial crisis to end soon and will remain very cautious, its top executive said in comments published by a German weekly on Saturday. "We can only speculate how deep and how long the recession in the United States will really be and how that in turn will impact banks," James Dimon told "Welt am Sonntag." "But we are not done with the crisis for a long time," Dimon said, adding that it was not the company's job to make bets on the future.
Ford Motor Co. will offer buyouts to roughly 1,300 workers at two assembly plants in Kentucky and Illinois in a further attempt to reduce labor costs as part of the automaker's turnaround strategy.
Russia will increase its crude export tax by 17 percent to a record on June 1, after oil prices rose in March and April. The tax will be set at $398.10 a metric ton, the seventh consecutive increase, Alexander Sakovich, deputy head of the Finance Ministry's customs department, said by telephone in Moscow today. The current duty is $340.10 a ton, or $46.40 a barrel.
According to the NY Times, Many of the 158 million people covered by employer health insurance are struggling to meet medical expenses that are much higher than they used to be — often because of some combination of higher premiums, less extensive coverage, and bigger out-of-pocket deductibles and co-payments. With medical costs soaring, the coverage many people have may not adequately protect them from the financial shock of an emergency room visit or a major surgery. For some, even routine doctor visits might now take a back seat to basic expenses like food and gasoline.
Microsoft Corp. said late Saturday it was withdrawing its bid to acquire Yahoo Inc. Steve Ballmer, CEO of the Redmond-Wash.-based software giant, said the company continued to believe its proposal made sense for both companies, but that "the economics demanded by Yahoo do not make sense for us." In a letter to Yahoo CEO Jerry Yang, Ballmer said he was "disappointed that Yahoo has not moved toward accepting our offer," formally ended negotiations after three months. Yahoo chairman Roy Bostock said the company has remained "steadfast in our belief that Microsoft's offer undervalued the company and we are pleased that so many of our shareholders joined us in expressing that view."
In my view, the market sets the value for a company. When was the last time Yahoo traded at $37? Yahoo continues to lose market share and their ability to grow on a consistently profitable basis has not been proven. Yahoo has 500 million users and has had extreme difficulty in monetizing those users. ``Unbelievable,'' said Laura Martin, an analyst at New York- based Soleil Securities Corp. ``This is management putting its employees and its job security ahead of current Yahoo shareholders' interest.'' ``The shareholders will wake up tomorrow morning or tonight and say `Jerry, what are you doing?''' RBC Capital Markets analyst Robert Breza in Minneapolis said yesterday. ``They weren't doing the best job, and Microsoft put a fair offer on the table. And for them to up the bid and for these guys to not want to engage -- I think Microsoft's being smart here.''
Google outsold Microsoft in Web ads 7-to-1 in its last fiscal year and handles six times as many search queries in the U.S., according to ComScore Inc. in Reston, Virginia.
JPMorgan Chase & Co does not expect the U.S. financial crisis to end soon and will remain very cautious, its top executive said in comments published by a German weekly on Saturday. "We can only speculate how deep and how long the recession in the United States will really be and how that in turn will impact banks," James Dimon told "Welt am Sonntag." "But we are not done with the crisis for a long time," Dimon said, adding that it was not the company's job to make bets on the future.
Ford Motor Co. will offer buyouts to roughly 1,300 workers at two assembly plants in Kentucky and Illinois in a further attempt to reduce labor costs as part of the automaker's turnaround strategy.
Russia will increase its crude export tax by 17 percent to a record on June 1, after oil prices rose in March and April. The tax will be set at $398.10 a metric ton, the seventh consecutive increase, Alexander Sakovich, deputy head of the Finance Ministry's customs department, said by telephone in Moscow today. The current duty is $340.10 a ton, or $46.40 a barrel.
According to the NY Times, Many of the 158 million people covered by employer health insurance are struggling to meet medical expenses that are much higher than they used to be — often because of some combination of higher premiums, less extensive coverage, and bigger out-of-pocket deductibles and co-payments. With medical costs soaring, the coverage many people have may not adequately protect them from the financial shock of an emergency room visit or a major surgery. For some, even routine doctor visits might now take a back seat to basic expenses like food and gasoline.
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