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e445a1d58cc0db7fdbf4d972612a7979 | https://www.cnbc.com/2009/09/29/big-merger-deals-signal-restored-confidence.html | Big Merger Deals Signal Restored Confidence | Big Merger Deals Signal Restored Confidence
The corner office is getting a bit more bullish about the economy.
While investors have been bidding up shares in the stock market for months, many chief executives and boards had privately remained skittish about their own businesses — until recently.
In a signal that confidence — and perhaps a bit of executive swagger — may be returning to the business world, two large mergers were announced on Monday, adding to a flurry of deals in the last month. First, Abbott Laboratories , the drug maker, agreed to acquire a unit of Solvay of Belgium for $6.6 billion, and then Xerox agreed to buy Affiliated Computer Services, an outsourcer, for $6.4 billion.
Neither merger compares in size to the double-digit billion-dollar deals that took place just two years ago at the height of the buyout boom.
But taken in the context of what has been a merger drought — in the wake of the financial crisis, deal-making is still off by more than 50 percent from last year — the transactions suggest that the most senior ranks of corporate America may now have a more optimistic outlook on the economy than some people thought.
“Will you see us move with a lot of acquisitions over this next year? You betcha,” John Chambers, the chief executive of Cisco Systems, said in a recent meeting. “Especially if it plays out economically the way that I think.”
For nearly two years, mergers plunged along with the markets as executives grappled with trying to understand how best to survive. At this time in 2007, $1.28 trillion in takeovers in the United States had been announced; so far this year, only $491.8 billion have been announced, according to Thomson Reuters.
And with stock prices fluctuating sharply after falling for many months until the spring, buyers were anxious about overpaying and sellers were nervous about shortchanging themselves. But as the markets have rebounded and leveled off, companies are more confident about their prospects, so they are dipping their toes into the deal waters. The takeovers, in turn, helped lift the stock market on Monday, which had stalled recently.
“The psychology has changed. This is sign that things have stabilized,” said Boon Sim, Credit Suisse’s head of mergers and acquisitions for the Americas, who suggested that deals were a lagging indicator to the stock market. “I don’t think the floodgates are opening up,” he continued, “but C.E.O.’s are now beginning to say, ‘If I don’t buy it now, it’s only going to get more expensive in the next 12 or 18 months.’ ”
What Wall Street hasn’t seen, of course, is the return of the biggest buyers in recent years — the private equity firms that propelled much of the merger mania during the debt-fueled bubble.
And that may be good news. The big deals announced recently are strategic deals, in which one company buys another to make it an integral part of its business, and they require the buyer to take on mounds of new borrowing to pay for the acquisition.
In contrast, many of the takeovers for the last five years were based on little more than financial engineering, with lax lenders providing low-interest debt to help private equity firms buy companies that they often planned to resell quickly in hopes of pocketing a fast profit. That has left many companies struggling to make interest payments, making it harder for them to invest in new products or more efficient manufacturing methods.
A number of those takeovers are already underwater and some have turned sour. Just one example: Simmons, the mattress maker, was bought by the private equity firm Thomas H. Lee Partners, or THL, in 2003, largely with borrowed money. Last week, THL said that Simmons — whose immense debt burden from the takeover was hampering its prospects — would be put into bankruptcy proceedings and sold. But the sale price for Simmons is so low that bond investors will lose around $500 million.
At Xerox, Ursula M. Burns, the company’s chief executive, said that she pursued the deal for Affiliated Computer Services only because she finally felt more comfortable with the performance of her own business. “We’re confident that our base business will rebound when the economy does — and in Q2 saw the right trends in this direction,” she said. “So, all factors played to our favor. At the end of the day, in tough times, strong companies look to invest in their future.”
While the recent mergers may represent a positive sign for the economy, Alexander Roos, a partner at the Boston Consulting Group, is less inclined to believe that we are about to see a burst of activity. In a study to be published on Tuesday, he said, his analysis of a sample of companies in the Standard & Poor’s 500-stock index shows that about 20 percent are “predators,” ready to take on the risks of a deal, while another 20 percent are “prey.”
“We expect a window of opportunity offering attractive takeover prospects to open soon,” Mr. Roos said. “We have already seen some of our smarter clients making preparations in recent months.”
The greatest concentration of deal-making appears to be in the health care and technology sectors. Warner Chilcott made a $3.1 billion deal for Procter & Gamble’s drug business last month, for example, and Dell bought Perot Systems, a technology services company, for $3.9 billion. But deals are also being made in other sectors, like food; Kraft’s $16.7 billion unsolicited bid for Cadbury, which was rejected but remains a possibility, is the largest outstanding offer to date.
“If you’re healthy, it’s a great time to acquire inexpensively,” adds Ted Rouse, a head of Bain & Company’s global mergers and acquisitions practice. “But it’s an awful time for two weak companies to merge.”
While the return of corporate mergers may be a good sign for the economy, a bigger question may be whether it is such a good thing for companies. Most deals sound great at the time, but in the end, not all of them work out as well as planned.
CNBC Slideshows
Eleven Surprising Stock Market IndicatorsThe World's Safest Banks
Mr. Rouse said, “Before the recession, Bain’s research on M.&A. showed that approximately 55 percent of acquisitions failed to deliver expected shareholder returns after one year — worse than flipping a coin. The odds only get worse as the size of the acquisition increases and the target is further from the acquirer’s core business.”
Let’s hope the odds are better this time around.
The latest news on mergers and acquisitions can be found at nytimes.com/dealbook.
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4abf70a8a497800cd20545842e17d3f8 | https://www.cnbc.com/2009/09/29/biggest-point-drops-in-dow-history.html | Biggest Point Drops in Dow History | Biggest Point Drops in Dow History
One year ago today, the Dow closed down 777.68 points for its worst 1-day point drop ever.
On September 29, 2008, the markets were already weak throughout the morning (down 250-300 points) but plunged even further around 1:45pm as the U.S. House of Representatives failed to pass the $700 billion bailout bill.
To this day, that decline is the index's largest point drop ever. In fact, the Dow has only dropped more than 700 points twice in its history. The second time the Dow saw a 700+ point drop was its 733 point drop later on October 15, 2008 (which was the Dow’s worst percentage drop since the crash of October 1987).
Keep in mind, despite the huge point drop, the fall on September 29, 2008 is currently only the 20th biggest 1-day percentage decline for the blue chip average.
If the Dow were to top its biggest point decline today, it would incur a heftier percentage decline given the index’s current lower levels. Assuming yesterday’s closing level, a 777.68 decline would equate to a 7.9% drop in the Dow – surpassing its biggest percentage declines last fall.
Dow's Largest Point Declines (All-Time)*
Comments? Send them to bythenumbers@cnbc.com
bythenumbers.cnbc.com
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1c7063af92f7ca3cb0559b2cf4732bdf | https://www.cnbc.com/2009/09/29/busch-global-thirst-for-capital.html | Busch: Global Thirst For Capital | Busch: Global Thirst For Capital
In the global quest for revenue and funding, three new
entrants are making a splash.
The European Bank for Reconstruction and Development
(EBRD) has appealed for a 50% capital increase to mitigate
the impact of the global economic crisis on central and
eastern Europe
according to
the FT . They are asking for an extra E10bn
($14.5bn) to allow it to expand its lending and compensate
for a sharp decline in private capital flows into the former
communist countries. The EBRD is controlled by 60
countries.
BNP Paribasjoins the long list of global
banks attempting to buy their way out of government ownership
by raising capital. France's largest bank announced
that they would launch a E4.3 billion rights issue that would
be used to buy back E5.1 billion in shares the government
bought to help BNP during the crisis. BNP joins
J.P. Morgan, Goldman Sachs, and
Morgan Stanleyin repaying the government for
their assistance.
Lastly, the FDIC is going to propose today that the
bulk of the banking industry prepay three years' worth of
fees to replenish the fund that insures trillions of dollars
of customers' deposits. According to the
WSJ , the FDIC having banks pay up front for
2010, 2011 and 2012 could bring between $36 billion and $54
billion to the government agency, which insures deposits at
more than 8,000 banks. The WSJ said it couldn't be
learned when the assessments would have to be
prepaid. Why is it when I read this new funding
scheme, I think California? Here's the question for Ms.
Bair:
"What happens after the FDIC goes through this funding
and needs more? 2013 to 2016?"
On CNBC.com now:
Slideshow:
The World's Safest Banks Central
Banker Report Cards 2009
In the United States, this demand for revenue/funding will
grow exponentially should the Congress pass a health care
"reform" bill that increases spending without finding a
revenue source to cover the costs. One of the
costliest components of the bills circulating that will
eventually have to be reconciled is the public option.
However, the bill will mandate a large increase in Medicaid
spending that the individual states will have to
support. Remember, US state governments received
payments from the $87 billion stimulus plan to help them with
Medicaid.
EBRD, BNP, and FDIC indicate a global search for funds and
revenue from three separate areas of the global
economy. This demand will grow more acute as we head
into 2010 if the global economy fails to rebound
consistently. There is a waterfall effect developing
from government economic spending and the resulting bill
coming due in the form of government deficits. To
deal with this demand, the tax base will need to be increased
or the tax level will go up. I expect both to happen
globally.
Can bell bottom jeans, men's facial hair, and 1970s
stagflation be far behind?
See all
CNBC.com Guest Blogs here
________________________
v align="left">
Andrew B.
Busch is Global FX Strategist at BMO Capital
Markets, a recognized expert on the world financial
markets and how these markets are impacted by political
events, and a frequent CNBC contributor. You can comment
on his piece and and you can follow him on Twitter at .
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19a79f2373627c58ca76c611b238fe0c | https://www.cnbc.com/2009/09/29/chadwick-the-impending-economic-recovery-will-take-time.html | Chadwick: The Impending Economic Recovery Will Take Time | Chadwick: The Impending Economic Recovery Will Take Time
Floyd Norris of the New York Times wrote a very interesting article in that newspaper this past Saturday. He pointed out that since the 1950s when the Government started keeping track of debt levels in this country, debt growth has never been as slow as it was in the second quarter of this year.
He went on to explain that the private sector debt actually fell, also a first in over half a century, while Federal Government debt soared, a fact we all know to be true.
Slideshow: Biggest Holders of US Gov't Debt
The facts and figures he displayed say a lot about what the U.S. economic recovery is likely to look like. The Government is the only major source of growth at this time in our economy. The entire stimulus is emanating from Federal Government borrowings and that stimulus is filtering down into the private sector through one-time Government sponsored incentives to individuals to purchase homes and automobiles.
The other broad economic sectors of our economy – consumer, non-financial and financial business – are engaged in balance sheet restructuring, which is equivalent to being in a retrenchment mode.
For years, or better stated, for decades in this country, both consumers and corporations drank the Kool-Aid of borrowing to spend, believing that all asset prices would logically rise over time and rising debt levels were a healthy way to live. Unfortunately, that was a pipe dream, and the day of reckoning has come.
The Crisis: 1 Year Later - A CNBC Special Report - See Complete Coverage
Despite the severity of the recession, the costs of many things have not fallen. Tuitions for college continue to rise. Gasoline vacillates in price but for sure it is higher that just a few years ago. Food prices seem to continue to rise. The only give-away prices are in areas where the Federal Government is promoting a big sale – auto and housing. What will happen when the big sale is over?
The recession appears to have ended and that is good news. Productivity improvements in the private sector have been impressive and that is also good news, IF you currently have a job.
But to get a recovery that is meaningful and strong and sustainable, the private sector, NOT the Federal Government, needs to be the driving force. A Government led recovery will be anemic and will peter out in no small measure because there will simply not be the appetite or the ability to support endlessly rising Federal budget deficits.
When net borrowing in the private sector starts to grow again, that will be the sign that health is coming back into the economy. It is difficult to predict when that will happen, and until then, unemployment will remain high and revenue growth will remain sluggish.
What other CNBC Contributors are Saying ...
______________________________________
Patricia W. Chadwick has had more than 35 years of investment experience. She is the founder and president of Ravengate Partners LLC, a consulting firm that provides advice on financial markets and global economics.
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473ea43e75beba4fcd251f3df5659b9d | https://www.cnbc.com/2009/09/29/charts-sp-may-hit-1157-but-momentum-is-waning.html | Charts: S&P May Hit 1,157 but Momentum Is Waning | Charts: S&P May Hit 1,157 but Momentum Is Waning
The S&P 500 could be due for an upswing toward 1,157 points in the short-term, but investor momentum is waning so a rise to that level would signal an “excellent” selling opportunity, Roelof van den Akker, chartist at ING Wholesale Banking, told CNBC.
VIDEO2:4602:46Charts: S&P 500 Could Rally to 1,157
“We could see a possible short-term upward rise above resistance line for a test of this horizontal resistance at 1,157 (points), but also here we see this loss of momentum … as long as this continues we should also expect the development of a trend change sooner or later,” Akker said.
Akker recommends selling the S&P if it rises to 1,120 points or possibly 1,157 points. The move could prove to be “an excellent selling opportunity,” Akker said.
Watch the video above to see Akker’s view on Germany’s DAX index.
For the Investor:
5 Tech Stock Picks from Top AnalystsOil vs. Gold—Where You Should Invest: Strategists
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0bc2ea0a326ce4aa90734a8281ad7274 | https://www.cnbc.com/2009/09/29/cocacola-africa-the-new-china.html | Coca-Cola: Africa - "The New China" | Coca-Cola: Africa - "The New China"
Forget China. The next big growth story in the next decade is Africa. With a population that’s fast approaching the one billion mark, Coca-Cola’s CEO Muhtar Kent believes that “Africa is really going to blossom in the next decade.” Kent wasn’t the only one to talk up Africa’s potential last week. Qatari Prime Minister Sheikh Hamad bin Jasim bin Jasir al-Thani told Maria Bartiromo in an interview that Africa is where the growth will be.
VIDEO0:0000:00Coke CEO: Economy a Question Sans Stimulus
Bartiromo caught up with Kent exclusively on the sidelines of the Clinton Global Initiativemeeting last week, where he also provided more detail on Coca-Cola’s $5 million contribution to The Clinton Foundation.
Most of the funds will go toward programs in the developing world, with a particular focus on Africa. Kent told Bartiromo that this money would go into expanding Coca-Cola’s manual distribution centers, which distribute its products in urban areas. The project currently employs 12,000 people and generates over $550 million in annual revenues. Kent hopes to increase the number employed as a result of this project to 20,000 by the end of 2010. Kent described these entrepreneurs as being Coca-Cola’s “manual distribution centers across Africa where trucks can’t go.”
In the last 10 years, Coca-Cola and its partners have invested almost $6 billion in Africa. Kent expects that figure to increase, targeting another $12 billion over the next 10 years to expand the company’s presence in the continent.
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The Dow 30 in Real TimeOut From India’s Alleys, Gold Loans Gain RespectThe CNBC Stock Blog
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Questions? Comments? Write toinvestoragenda@cnbc.com
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bc275209cd67ce7d4380cbffff069180 | https://www.cnbc.com/2009/09/29/cramer-hold-on-to-this-monster-retail-stock.html | “I would hold on to Ralph Lauren,” Cramer said during Tuesday’s Stop Trading!, even though the stock is up almost $4 today.
VIDEO0:0000:00Stop Trading!
“This has been a monster stock since the bottom,” the Mad Money host said, “and I continue to believe it will remain a monster stock.”
The company’s namesake “has done a miraculous job,” Cramer continued, of steering the operation through tough economic times. He praised Ralph Lauren’s execution, expansion overseas and the power of its brand name, calling them key parts of an “incredible story.”
Cramer also endorsed VF Corp. in the retail space.
Lastly, Walgreen and CVS Caremark are buys on a big flu-shot season, Cramer said. Beyond the vaccines, “big impulse purchases” will help to drive sales.
There was a Starbucks versus Sanka taste test during Stop Trading! today. Which did Cramer choose? Watch the video to find out.
Cramer's charitable trust owns VF Corp.
Call Cramer: 1-800-743-CNBC
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
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f7f384262d42176a8896ff1ecbcb92b7 | https://www.cnbc.com/2009/09/29/does-this-chipmaker-have-more-room-to-run.html | Does This Chipmaker Have More Room to Run? | Does This Chipmaker Have More Room to Run?
As analysts debate the health of the semiconductor sector, at least one trader is apparently confident that chipmaker Analog Devices has room to run higher.
Yesterday's option activity was focused on the November 27.50 strike, where a single block of 2,000 calls was bought for $1.65, according to . The average turnover is only 24 calls per day at the strike, which showed open interest of 378 contracts.
Options Tips from Jon NajarianRead The CNBC Stock BlogOptions Tips from Pete Najarian
Analog Devices finished the day up 1.6 percent to $28.02. The stock hit a new 52-week high of $29.71 just on Sept. 10 but then slipped and has been bumping up against resistance around $28.
For the calls purchased yesterday to turn a profit, the stock would need to gain at least 4 percent by the time the options expire on Nov. 20. The company is scheduled to release its next quarterly earnings report on the very next trading day after expiration.
The health of the chip industry remains in general remains an open question. Earlier this month, for example, Analog Devices was one of several chipmakers to receive a lower rating when Broadpoint Amtech downgraded the entire semiconductor sector. Yesterday, however, Goldman Sachs reiterated its 2010 forecast of 13 percent growth in handset units, an area where Analog Devices hopes to expand.
___________________________
Analog Devices Competes With:
STMicroelectronics
Texas Instruments
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Options Terminology: GlossaryBasic Strategies — with ExamplesOptions Basics: The ABCs
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Mike Yamamoto is an analyst and writer for .
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Disclaimer
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fe5e4fa4eaffd0667c1615831b05a7ed | https://www.cnbc.com/2009/09/29/dont-jump-on-the-mead-johnson-rumor.html | The Faber Report | The Faber Report
A report from ft.com/alphavillethat Group Danone had hired an investment bank to work on a possible bid for baby food company Mead Johnson had those shares up over 10% briefly.
After speaking with bankers close to both companies it appears investors looking for a deal anytime soon will be disappointed.
Big Merger Deals Signal Restored Confidence
Yes, Danone would have interest in looking at Mead at some point, they tell me. But Mead Jonhson is still controlled by Bristol-Myers-Squibb (83.1% ownership stake) from which it was recently spun off and these bankers tell me Bristol has not shown interest in selling.
Bristol faces a huge tax hit if it sells its stake for cash given its cost basis in Mead is very low, said one banker close to Bristol. He went on to say that he sees no signs from Bristol that it has any interest in parting with Mead Johnson. If and when that changes, bankers close to Danone tell me that if and when Bristol is interested in relinquishing its control stake, there likely would be interest from Group Danone in looking at buying it and perhaps the rest of Mead Johnson.
Said one banker close to Danone “There is nothing new and nothing happening near term.” All of that is not to mention that at present buying Mead Johnson would seem implausible for Group Danone, given it would take at least $12 billion. “They can’t afford it, “ said the banker.
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The Dow 30 in Real TimeJes Staley In Line to Succeed JPMorgan CEO DimonThe CNBC Stock Blog
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Questions? Comments? Write to faberreport@cnbc.com
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2e81eb1070ed5f8a8d220dd775bcd26c | https://www.cnbc.com/2009/09/29/earnings-roundup-sept-29.html | Earnings Roundup: Sept. 29 | Earnings Roundup: Sept. 29
What follows is a roundup of corporate earnings reports for Tuesday, Sept. 29.
BEFORE THE BELL
Walgreens
The retail drugstore chain reported earnings of 44 cents per share for the fourth quarter that ended Aug. 31. The company posted sales of $15.7 billion.Click for Full Story
AFTER THE BELL
Darden Restaurants
The restaurant company, whose restaurant chains include Red Lobster and Olive Garden, posted a profit of 67 cents per share for its fiscal first quarter ended Aug. 30. The company reported revenue of about $1.73 billion.
Jabil Circuits
The electronics solutions company to reported a profit of eight 16 cents a share during its fourth quarter ended Aug. 31, compared with 30 cents per share a year ago. Jabil posted sales of $2.8 billion.
Nike
The athletic wear company beat analysts' estimates and posted a profit of $1.04 per share share for its first quarter ended on Aug. 31, up slightly from last year's $1.03 per share. Nike reported revenue of about $4.8 billion.
*Earnings data based off of Thomson Reuters
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3d550d9bad094d86b302309669555196 | https://www.cnbc.com/2009/09/29/equities-will-go-higher-stock-picker.html | Equities Will Go Higher: Stock Picker | Equities Will Go Higher: Stock Picker
September was a fairly good month for stocks, but how should investors prepare for October? Dan Fitzpatrick, president of Stockmarket Mentor, and Tommy Williams, president of Williams Financial Advisors, offered their insights. (See below for their recommendations.)
VIDEO0:0000:00Q4 Outlook: Bull vs. Bear
“I think we’re in an era of messiness,” Williams told CNBC.
“What we see is the psychology like a human being where the markets are being driven by things that are more psychological—we need Dr. Phil rather than Warren Buffett, perhaps!”
Williams said the real risk for investors right now is being in cash.
“The W-[shaped double dip] question won’t be answered until the second quarter of next year," he said. "But it looks like pretty clear sailing for the rest of the year—I’m encouraged.”
More Market Intelligence:
3 Hot Consumer Stocks: Portfolio ManagerCharts: S&P May Hit 1,157 but Momentum Is WaningPisani: Why M&A is NOT Driving This Market
Fitzpatrick said he is not seeing the market weaknesses that many investors are finding.
“Volume has been increasing in the last few months as the market’s gone higher,” he said. “For equities, I think we’re going higher. There’s a big dislocation between economic numbers and economic outlook versus markets.”
Fitzpatrick said he likes the energy and defense sectors.
“The market’s looking for value and a lot of these companies are still pretty cheap going forward. Once again, we see all of these things in decline in defense spending but there’s still money coming into these stocks,” he said.
“So I think there’s going to be a money rotation. But ultimately, there’s a dislocation between what the numbers are and what’s happening in stocks.”
Fitzpatrick Likes:
Technology SPDR
Apple
AT&T
Northrop Grumman
Rockwell Collins
Boeing
Williams Likes:
S&P Technology
S&P Consumer Discretionary
______________________________ Disclosure:
No immediate information was available for Fitzpatrick or Williams.
______________________________CNBC Slideshows:
The Biggest Holders of US Government Debt
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Disclaimer
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799d9d1cbe4036fa8c9f94d23f4dea41 | https://www.cnbc.com/2009/09/29/five-things-that-could-spook-stock-investors-this-october.html | Five Things That Could Spook Stock Investors This October | Five Things That Could Spook Stock Investors This October
If September was a month that defied expectations, October might be the month that lives up to them.
Jack O' LanternPhoto: Carole Pasquier
All of which means another nerve-wracking ride for investors.
The first month of autumn is reliably known as the stock market's worst, but this year passed with not much more than an occasional jolt as the Standard & Poor's 500 has gained about 4 percent.
Its follow-up act in October is both "the jinx month" for its history of market crashes and a "bear killer" for its reversal of 11 bear markets since World War II, according to the Stock Trader's Almanac.
Market pros, then, have their sights set on a number of factors to watch as the fourth quarter begins and Wall Street looks to put some fundamental legs beneath the technical sprint it's been on for the past seven months.
"What we need to see now is the one step forward, two steps back now goes to one step forward," says Quincy Krosby, general market strategist at Prudential Financial. "The market needs something bigger and better to get it excited."
Among the multitude of factors likely to influence investors, here are five keys:
1. Earnings
Second-quarter earnings pleased investors, with about a 3-to-1 upside surprise in performance over expectations. Yet projections for the third quarter are that S&P 500 companies will report an overall 15.4 percent drop in profit from a year ago.
While companies still may beat expectations, the bar is rising and the trend of cost-cutting offsetting weak revenue will have to change.
"Top-line revenue growth—that's really what investors are waiting to hear," Krosby says. "If they don't hear it enough times the market will react accordingly."
Investors may tolerate one more quarter of less-bad earnings, but the outlook and trend will be key.
"You get this sense that we could fall into a double-dip recession—a fear that's out there—but it's most likely going to keep analyst estimates low during this season's forecast," says Doug Lockwood, CIO of Cornerstone Wealth Management in Auburn, Ind. "That simply sets up the ability to have further positive earnings surprises."
2. Jobs—And Consumer Health
Unemployment remains probably the market's most critical metric, and Wall Street won't have to wait to gauge how strong consumers will be. The Labor Department is set to release its monthly jobs report on Friday, and investors will be watching closely.
"Losing jobs makes everybody nervous. If you have a job and your neighbor doesn't it still makes you nervous," says Kathy Boyle, president of Chapin Hill Advisors in New York. "The consumer's saving and they're still behind the eight ball. They don't have enough money for college, they don't have enough money for retirement."
This Day 1 Year Ago - A CNBC Special Report - See Complete Coverage
A market bear, Boyle thinks more signs of weakness—such as Tuesday's drop in consumer sentiment—will weigh on the market in October and possibly drive a strong move lower.
By the same token, though, Wall Street cheered Monday over the spate in mergers and acquisitions activity, and a continuation in that trend could signal a turnaround for the jobs market.
"Anytime you have acceleration of mergers and acquisitions activity generally portrays that businesses are starting to hire more," Lockwood says. "You've shaken out the weak ones. They don't start doing that unless they're able to find financing or that the deals are too good to pass up."
Lockwood, who thinks October could be "flat to low-positive," says the health of luxury hotels will serve as a good barometer for where the consumer is positioned.
3. Technical Levels
Many analysts say the market's momentum has been based strongly on technical benchmarks that have been eclipsed after the market reached a strongly oversold position in March.
Similarly, some are now starting to wonder if the market hasn't reached a resistance level from which it will correct following the rally.
"Trading has picked up. That's also something that makes people nervous," Krosby says. "Once the day traders get in there, they typically come in at the end of a momentum-driven rally."
"If we have a consolidation, which is the most minor form of a pullback, that's one thing. If it's something larger than a consolidation, those riskier assets are going to sell off and sell off dramatically."
Questions about the technical aspect of the rally have heightened as the S&P has shown resistance at the 1065 level, pulling back once it passed that area.
That's not necessarily a long-term bearish sign for the market, but could signal an impending correction.
JupiterImages | Comstock Images | Getty Images
"Support remains 1014-1000 with key support at the August low of 978.50," BofA Merrill Lynch Global Research analyst MaryAnn Bartels wrote in a note to clients. "We maintain that the risk of a 15-20% correction is rising within the context of a base-building process and that the major area of resistance at 1200-1325 can be tested in 2010."
4. Financials
After 18 months at the center of the market firestorm, beaten-down financials have been a major player in the stocks rally.
Now, with many of the industry's biggest names seemingly back on their feet, their performance will be watched closely for clues about the broader market.
"We're watching the financial stocks very closely," Krosby says. "We don't want to see the best of breed sell off."
VIDEO0:0000:00Impact of Proposed Short-Selling Restrictions
Analysts have been watching the yield curve—specifically, the gap between yields on the 10-year and 2-year Treasury notes—and drawing caution about what it might portend for the sector. A wide spread generally means good things for the group, but a narrowing spread, as has been happening lately, could be a sign of trouble.
5. Everything Else
Geopolitics, commodity prices, dollar moves—they're all in the mix as well as the world endures a tumultuous time of saber rattling in the Mideast, declining faith in the US currency and a health care battle at home.
"The news is still really bad, so I'm looking for a reaction in October," Boyle says. "However, there's enough money on the sidelines and these big hedge-funds are throwing these programmed buy trades in. We see a lot of business controlled by programmed trades."
Of course, that can cut both ways, as the market has found out the hard way in the 18 months preceding the March rally.
Fear is still a strong ingredient in this market environment.
"I'm in the skeptic crowd," Art Cashin, director of floor operations at UBS, told CNBC. "I think it's going to be tough for the economy to live up to the hope and hype that we've seen in some of these stocks."
Slideshow: World's Best Banks 2009
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076f22bb4bf92ad5525b77ab0b1a85e8 | https://www.cnbc.com/2009/09/29/former-democratic-fundraiser-sentenced-to-24-years.html | Former Democratic Fundraiser Sentenced to 24 Years | Former Democratic Fundraiser Sentenced to 24 Years
Former Democratic fundraiser Norman Hsu was sentenced to more than 24 years in prison Tuesday by a judge who accused him of funding his fraud with a "conniving use of the political process."
U.S. District Judge Victor Marrero sentenced Hsu to 20 years in prison for his guilty plea to fraud charges and another four years and four months in prison for his conviction at trial for breaking campaign finance laws.
The judge said Hsu stole more than $50 million from hundreds of investors in a 10-year fraud by winning their confidence with a pristine reputation, even as he ripped them off in a complex Ponzi scheme, a recipe that the judge noted fits many white collar crimes.
He called Hsu a "wolf in sheep's clothing."
He said his "conniving use of the political process to fund his fraud" made his crimes "much more sinister and reprehensible."
Before he was sentenced, Hsu apologized.
His donations became an embarrassment for Hillary Rodham Clinton's presidential campaign. His arrest led Clinton to return more than $800,000 to donors linked to Hsu.
Prosecutors say Hsu obtained millions of dollars from investors by claiming clothing or high-technology ventures would pay returns of 14 and 20 percent. Instead, he spent the money on himself.
Hsu's decade-long Ponzi scheme collapsed in September 2007.
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c7961007dab58affb72fb3b50f624d7a | https://www.cnbc.com/2009/09/29/halftime-report-stocks-sideways-thru-quarters-end.html | Stocks lost steam on Tuesday as investors chewed on some key economic data related to consumers and housing.The bears came out of hibernation after the latest figures showed consumer confidence not only fell unexpectedly in September, but more Americans consider jobs “hard to get.”
The data suggests that despite improvements in the economy, it could be a long time before consumers contribute to growth. “With the holiday season quickly approaching, this is not very encouraging news," says Lynn Franco, director of the Conference Board Consumer Research Center.
However on a bullish note, D.R Horton , Toll Brothers and other homebuilders showed gains after an improved S&P/Case-Shiller home price index reading, suggested the housing market was bottoming out.
What must you know to trade this market?
VIDEO0:0000:00Fast Money Halftime Report
Instant Insights with the Fast Money tradersIt seems like there’s a push and pull in the market. Consumer confidence was weak but housing looks okay so investors are trying to digest all that, says Fast Money trader Pete Najarian. To me it seems like investors are going to allow the market to close the quarter right about where it is.
I also expect the S&P to hover around 1062 heading into the end of the quarter, muses Steve Grasso of Stuart Frankel .If you're looking for a trade I’ve got my eye on some of the boutique firms. Both Jefferies and Greenhill hit 52-week highs, adds OptionMonster Jon Najarian. I like both names. And I don’t think you’re late to the party.
Or check out RIM - it bounced on Tuesday, adds Patty Edwards of Storehouse Partners. The 200-day moving average looks like support. I think the bad news is now baked into share price and I’d start nibbling.
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CREDIT CARDS RULESThe U.S. Federal Reserve on Tuesday proposed tough new credit card rules to protect consumers from potentially costly practices by lenders and moved to implement legislation enacted in May.
Among the more controversial proposals is one that would prohibit creditors from issuing a card to anyone under the age of 21 unless the borrower has either the ability to make the required payment, or has the signature of a parent or other co-signer who has the means to do so.
What’s the trade?In the space I’ve liked Visa , says Pete Najarian. But the new rules could drag down the shares.
Keep in mind these are proposals for new rules, adds Patty Edwards. In the space I like Visa as well as MasterCard. I bet if the rules pass we’ll see more debit cards and that’s good for Visa and Mastercard.
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OPTIONS ACTION: BIIB
Jon Najarian has spotted unusual options activity in the Biogen .
A high volume of call buying suggests to Najarian this stock could move a sharp move higher.
----------------OIL CHOPPY
U.S. crude oil futures slipped in very choppy trading on Tuesday as the dollar's early strength and concerns about demand overshadowed geo-political concerns about Iran's nuclear program.
For the moment, the tensions with Iran are not providing much support to prices," says Mike Fitzpatrick, vice president at MF Global in New York said in a research note.What's the trade?
I think we’re at a key junction in the price of oil, adds Summit energy analyst Brad Samples. If we see oil break lower on big inventories we could see it go to $55. For a trade I think it’s okay to short crude.
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FAST & FURIOUS: THE KEY QUESTIONS INTO THE CLOSE
BUY SBUX?Starbucks announced a new national Tv campaign and new instant coffee, should you buy?
I love the run, but I don’t think this is a reason to buy, counsels Pete Najarian.
BUY JCP? Deutsche Bank reiterated its buy on JCPenney on Tuesday saying they are confident in company's operational plan. Do you buy?
I’m not a buyer, says Patty Edwards. I’d rather be in Kohl’s.
BUY CITI? Rochdale analyst Dick Bove upgraded his price target on Citigroup , should you buy?
That’s not a fast money trade, says Jon Najarian. That’s a slow money trade.
BUY GOLD? With the EU backing the argument fora stronger dollar how should you trade gold ?
I’m worried about inflation, explains Steve Grasso. I’m a buyer of gold on dips.
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CALL THE CLOSE
Pete Najarian: I’m a buyer.
Patricia Edwards: I’m short the market and long the dollar.
Jon Najarian: I’m long into the bell.
Steve Grasso: I’d err on the side of selling.
______________________________________________________Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send those e-mails to .
Trader disclosure: On Sept. 29th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Terranova Owns (KCE), (F), (ABT), (XOM), (SUN); Terranova Is Short (CCL), (ESS); Grasso Owns (AAPL), (ABK), (BAC), (C), (COST), (CSCO), (PFE), (V), (MMT); Finerman's Firm Owns (BAC) Preferred Shares, Finerman Owns (BAC) Preferred Shares And Owns (BAC); Finerman's Firm Owns (WFC) Preferred Shares And Is Short (WFC); Finerman Owns (WFC) Preferred Shares; Finerman Owns (RIG); Finerman's Firm Owns (MSFT), (NOK), (PBR), (WMT), (RIG), (TGT), (PLCE); Finerman's Firm Is Short (IJR), (MDY), (SPY), (IWM), (USO), (UNG); Najarian Owns (ACI) Call Spread; Najarian Owns (C) Calls; Najarian Owns (DELL) Call Spread; Najarian Owns (ERTS) Call Spread; Najarian Owns (GE) Calls; Najarian Owns (JPM) And Is Short (JPM) Calls; Najarian Owns (MS) And Is Short (MS) Calls; Najarian Owns (MSFT) And Is Short (MSFT) Calls; Najarian Owns (RIMM) Call Spread; Najarian Owns (ORCL); Najarian Owns (TEVA); Najarian Owns (V) And (V) Calls; Najarian Owns (WFC) Put Spread; Najarian Owns (YHOO) Call Spread ; Najarian Owns (BIIB) Calls
For Steve GrassoStuart Frankel Owns (ACS) Stuart Frankel Owns (GERN) Stuart Frankel Owns (MSFT) Stuart Frankel Owns (NWS.A) Stuart Frankel Owns (NYX) Stuart Frankel Owns (PDE) Stuart Frankel Owns (PFE) Stuart Frankel Owns (ROK) Stuart Frankel Owns (XOM) Stuart Frankel Owns (SDS) Stuart Frankel Is Short (QQQQ)
For Greg TroccoliTroccoli Is Short S&P 500 Troccoli Owns US Dollar
CNBC.com with wires
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b1610df99610f9b7fb092baacdb2679d | https://www.cnbc.com/2009/09/29/has-the-press-turned-pollyanna.html | Stop the presses! The media’s gone positive on the markets, Cramer said Tuesday. A number of stories in The New York Times, USA Today and Washington Post show these papers have switched from heralds of doom and gloom to cheerleaders of hope and optimism.
VIDEO0:0000:00Self-Fulfilling Market?
The Washington Post today pointed to the recent spate of M&A activity, namely Abbott Labs’ buyout of Solvay’s drug business. USA Today dismissed the endless chatter about another possible big decline, as well as a few other “canards,” as Cramer called them, that have been keeping people out of the market. And The New York Times wrote about the many improving areas of the economy, such as the financials, and talked up the psychological importance of Dow 10,000.
“This is a huge, bullish change-up,” Cramer said, “especially when you consider how unreasonably negative the press has been for months as the market soared ever higher.”
Cramer predicted that these stories, which appeared on the front page of each paper’s business section, would lure retail investors back into the market. And the more upbeat reports we get, the more money that will flow into stocks, which will push up share prices.
Expect the professional money managers to catch the fever as well. Let’s face it, they can’t stand by, watch the move happen and not take part. That’s how these guys lose their jobs. So Cramer said he expected a rash of buying from hedge funds, as they race to catch up. That, too, will boost share prices.
Now, Cramer wasn’t saying that things are perfect. He’d like to see better jobs numbers, just as anyone would. But remember: The market’s performed remarkably well regardless of the disappointing employment reports we’ve seen so far.
“The numbers have been terrible,” Cramer said, “and we’ve had the best rally in 10 years.”
Expect more cynical articles to pop up, though, Cramer said, urging readers to sell throughout October. But don’t let them, or the season, scare you out of the market. Any dip as a result of this negative press is a gift. Use it to buy more stocks at a discount, or as an entry point if you’ve missed the move so far.
Call Cramer: 1-800-743-CNBC
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
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ac0ff195eaa7effcbf317c7ec526646f | https://www.cnbc.com/2009/09/29/hmos-rally-then-fall-back-down.html | HMOs Rally, Then Fall Back Down | HMOs Rally, Then Fall Back Down
The Senate Finance Committee has rejected a government run public insurance option-this was expected but there was worry in the past week that a public proposal may gain momentum after some Senate Democrats said a public component may be included.
What's next? Now the bill being pushed by Finance Committee Chairman Max Baucus comes up. Baucus' bill does NOT include a public component. Baucus wants to push his proposal through quickly, possibly by the end of the week.
So, HMO stocks rallied, then dropped back. What's the problem? We still do not know what a final bill will look like, and whether or not new taxes or burdensome obligations will be imposed on them. Absent that certainty, the best strategy is hold or lighten up. _____________________________
The Dow 30 in Real TimeFive Things That Could Spook Stock Investors This OctoberThe CNBC Stock Blog
_____________________________
Questions? Comments? tradertalk@cnbc.com
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a5baef5963ccb5336f06e42e6b1bb22c | https://www.cnbc.com/2009/09/29/home-price-gains-are-seasonal-and-federally-fueled.html | Home Price Gains Are Seasonal and Federally Fueled | Home Price Gains Are Seasonal and Federally Fueled
I'm not a bear, I'm a realist. Let's get that out first.
Today's headlines from the folks at S&P/Case Shillerare not untrue, they're just not the whole picture. Yes, home prices, in most areas (and by no means everywhere) are no longer in freefall. Some local markets have hit bottom, others are falling less precipitously, and still others are showing some strength.
But if we're going to be forced to spew these national numbers, that the markets seem to crave (for some reason that I generally and specifically don't understand), then we have to take them with not a grain, but a shaker of salt. The top ten and top twenty market composites that the S&P/CS folks report are off their lows that we saw at the end of 2008 and beginning of 2009. Even the year over year numbers show it.
Slideshow: 10 Most Affordable Metro Areas
But take a look at the market breakdowns, month to month, which all the bulls tend to push, seasonally adjusted vs. non-seasonally adjusted.
Slideshow: Million Dollar Homes Across America
Questions? Comments?
RealtyCheck@cnbc.com
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3bad48c12a9381029fcdf1e17104583b | https://www.cnbc.com/2009/09/29/hyundais-hunger-leading-to-big-bites.html | Hyundai's Hunger Leading to Big Bites | Hyundai's Hunger Leading to Big Bites
"They are on the prowl, and they're not gonna stop."
It was the strongest statement my friend, a long time auto industry veteran made during a recent meeting we had to discuss who's up, who's down, and who we should be watching closest. His assessment, hands down, was Hyundai. When he said Hyundai is coming strong, I have to admit I wasn't surprised. But the Koreans are just getting started.
Hyundai
Hyundai is picking up market share here in the U.S. thanks to a potent combination of much better product (both in terms of quality and styling) and savvy marketing. A company that was once dismissed as weak imitator of the Japanese automakers is now taking it to the folks from Toyota, Nissan, and Honda.
And it shows now sign of slowing down.
So far this year, Hyundai is down 0.3% while its competitors are all down more than 20%. It's picked up 1.2% market share and now has 4.4% in the U.S. According to AutoData. In the auto business, gaining 1.2% share, even off a low base, is astounding. For comparison, the other major automakers growing this year are: Ford (up 0.8%), Volkswagen (up 0.6%) and Honda (up 0.3%), and BMW, Mercedes, and Mazda all up a tenth of a percent.
What impressed my friend, who has worked with many automakers over the last 20 years, is the fact Hyundai is hungry for more. And it will likely stay on a roll since it has yet to enter or has a limited presence in many segments. Stealing a page out of the Toyota playbook, Hyundai will be aggressive with the product and the promotion.
CNBC.com Special Report: Vintage Cars: Wheels of Fortune or Road To Ruin?
On that last point, Hyundai's job guarantee promotion turned out to be a huge winner because it generated traffic and worked to change perceptions about the automaker. Look for more unique programs like that.
As my friend said that day, "Hyundai is not slowing down, you watch.” We will.
Bookmark Alert: Track All the Dow Transports Here
_____________________________________Click on Ticker to Track Corporate News:
- Ford Motor
- Toyota Motor
- Nissan
- Honda Motor
_____________________________________
Questions? Comments? BehindTheWheel@cnbc.com
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4e1515f125a47e859bcc94da0dbf2d9c | https://www.cnbc.com/2009/09/29/is-windstreams-dividend-safe.html | VIDEO0:0000:00A Mighty WIN?
A stock that offers a big dividend yield is “a beautiful thing,” Cramer said Tuesday, but investors should question a payout that’s too big. Sometimes it means the share price has seen a significant decline, which usually happens when the company’s in trouble. If that’s the case, then the dividend could be cut, or eliminated entirely.
That’s why, as much as he liked Windstream , Cramer had his doubts about its 10% offering. The company certainly has its issues, namely liquidity. Just today Windstream announced that it hoped to raise $400 million in debt to pay for the cash portion of two acquisitions, and it was trying to renegotiate terms with some of its creditors.
“When you see that sort of thing from a company with a 10% yield,” Cramer said, “you have to get a little worried about the dividend.”
He wanted to know for sure, though. So Cramer invited Windstream CEO Jeff Gardner onto Mad Money “to help alleviate our concerns.” Watch the video for the full interview.
Call Cramer: 1-800-743-CNBC
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
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3b2e439b25b42ac1117d05953e6a8aab | https://www.cnbc.com/2009/09/29/kevin-warsh-is-on-the-money.html | Kevin Warsh Is On the Money | Kevin Warsh Is On the Money
Attendees of the and members of the Federal Reserve Board in Washington should carefully read a Wall Street Journalop-ed by Fed governor Kevin Warsh. In a piece titled “The Fed’s Job Is Only Half Over,” the former Wall Street investment banker sends a shot across the global economic bow. He says the Fed’s job will not be done until it removes the easy-money policies put in place over the past year. In other words, an exit strategy.Warsh writes that “policy likely will need to begin normalization before it is obvious that it is necessary, possibly with greater force than is customary.” He’s saying the Fed must be tougher, and act sooner, if it is to avoid an inflationary bubble reminiscent of the 2002-06 period, or for that matter the 1970s.Appointed by President George W. Bush in 2006, Warsh may be the only real supply-sider at the central bank. And while he doesn’t explicitly talk about the profligate surge of fiscal spending and borrowing by the Obama administration and its international counterparts, it’s not hard to infer that he’s talking about that as well.But back to monetary policy. Warsh says the Fed should not obsess about backward-looking indicators, like GDP and yesterday’s inflation readings. Instead, he argues that the central bank should track forward-looking signs of growth and inflation by paying careful attention to financial markets, asset prices, and risk premiums. In essence, Warsh is opting for a market-price rule that presumably tracks commodities (including gold), bond markets, the dollar exchange rate, and various credit-risk spreads in the fixed-income area. He’s moving away from the Philips Curve and the idea that the Fed should target an unemployment-inflation tradeoff — which is all Ben Bernanke ever seems to talk about.
On CNBC.com:
Slideshow: The World's Safest BanksCentral Banker Report Cards 2009World's Most Competitive Financial Centers
Since the unemployment rate is a hopelessly lagging indicator, the inflation forces will be well out of the barn by the time it starts dropping significantly. But Warsh knows that markets flash signs of the future. So rather than drive by watching the rearview mirror, he wants the central bank to look through the front windshield.Warsh was a senior White House official under President Bush, and he had a hand in the supply-side tax cuts on investment that were enacted in 2003. But it sounds like he learned a lot about the Fed’s cheap-money policies at the time. Those policies drove down the dollar for years and resurrected inflation, and they’re what killed the incentive effects of the Bush tax cuts and their positive effects on economic growth.The subsequent housing and commodity bubbles — including the massive energy shock — utterly doomed the economy. The Fed took tiny, one-quarter-of-a-point steps over a period of four years in an attempt to reclaim anti-inflation normalcy. But the policy failed dismally. So now Warsh seems to be saying: Let’s not make the same mistake again. Let’s take strong, large steps to raise the target rate and drain excess cash from the economy.I’m willing to bet that the rise in gold and commodity prices, along with the drop of the dollar, has Warsh thinking the Fed’s tightening time is not far off.Of course, this same dollar turbulence should be a fulcrum for the G-20 nations. If the U.S. greenback keeps sinking, a monkey wrench will be thrown into the global recovery. Dollar depreciation can export U.S. inflation worldwide, and drive up interest rates at home and abroad, if we force our trading partners to print too much money by buying too many dollars in a futile attempt to absorb dollar-excess.So instead of bashing banker pay, the G-20 members should undertake a worldwide dollar-rescue-and-stabilization program. That would strike a blow for currency stability everywhere and promote global economic growth.
The Crisis: 1 Year Later - A CNBC Special Report - See Complete Coverage
Alas, I don’t see any growth policies coming out of the G-20 nations right now. And with phrases like “peer review” being thrown around, I fear a U.S. exercise in financial and economic multi-literalism. Just as President Obama seems to suggest that American foreign policy will be run through the U.N., I’m wondering if U.S. economic and financial policies will be passed through the G-20 — a one-world financial regulator that will handcuff the American system.At the moment there are no supply-side tax cuts on the table. There’s no clear trade liberalization. And there’s no focused attention on the currency problem known as the dollar. Brazil and China are talking about a new world reserve currency, which is one reason why gold has been rising. But the dollar dilemma will rein supreme unless the G-20 does something about it.Kevin Warsh doesn’t go this far in his Journal piece, but his attention to financial-market price signals is something all the big shots in Pittsburgh should be thinking about.
Questions? Comments, send your emails to: lkudlow@kudlow.com
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be9a670581f72c907b54c2e26172366f | https://www.cnbc.com/2009/09/29/kneale-why-apple-is-the-worlds-best-retailer.html | Kneale: Why Apple Is the World's Best Retailer | Kneale: Why Apple Is the World's Best Retailer
Let’s just admit it: Apple, one of the coolest companies in the world, also is the best retailer on the planet. This is especially impressive given what Apple’s company-owned stores sell: high-tech gadgets that often befuddle “the rest of us.”
Great service, fiendish efficiency and a cultish devotion to its wares spark higher sales for Apple. One example: The other day I made a quick fly-by to an Apple store in the Big Apple, on 14th Street at Ninth Avenue in Manhattan. It started as a search for a simple $29 software upgrade.
I didn’t leave until three hours later—after spending $1,053.88. And yet, I was happy with the whole experience. How could this be?
I’ll reveal that in a moment, but first let’s zoom out to the panorama shot:
In some ways Apple stores started out of necessity. In 2001 retailers gave short-shrift to Apple and its declining market share, focusing instead on utilitarian “Wintel” systems based on Microsoft Windows software and Intel microprocessors and sold under Dell, IBM, Hewlett-Packard and other brand names.
Apple opened its first two retail stores in May of that year, in Glendale, Calif. and Tysons Corner, Va. It had 30 stores 12 months later. It now has 273 outlets, including four new stores that just opened over the past weekend. A total 217 stores are open in the U.S., plus 22 in Great Britain, 14 in Canada, seven in Japan, a smattering across Europe and even one outpost in Beijing. (Build a few more behind the Great Wall, guys.)
The stores act as a luminous, three-dimensional ad for Apple, a kind of DisneyWorld meets Tron. To be inside one is to be immersed in an all-Apple world, filled with Apple-lovers on both sides of the sales counter. But the retail chain churns a hefty amount of revenue, as well, sparking $1.5 billion or 18% of sales last quarter.
Must-See Link: Get Ready to Cringe at Microsoft 7's Launch 'Party'
The Apple corps’s key differentiator: great customer service, an elusive elixir in desperately short supply at retailers of all stripes. More than half the store employees are devoted to after-sale service, an Apple spokesman says. Free troubleshooting advice is offered at the humbly named Genius Bar in every store (though I did have to wait two days for an appointment).
My ascent into this heavenly retail experience started with a basic need: a new video-editing
A flag showing the Apple Computer logo flies outside the Apple shop in Regent Street, LondonKirsty Wigglesworth
program balked when I tried to install it on my PowerBook laptop. It told me I needed to update the laptop’s operating system and pointed to a $29 upgrade.
Cut to the Apple store on 14th street, with its shimmering, glassed-in façade and translucent, corkscrew staircase. Immediately you are greeted by a sea of t-shirted techies, all of them Apple seedlings: orange for greeters (concierges in Apple-speak) who point you in the right direction; pale-blue for folks who actually sell you stuff; dark-blue for the experts who then try to help you figure out how to use what you just bought; and black for the beasts of burden who keep the shelves amply stocked.
Soon I learn my machine can’t take the $29 upgrade. It is stuck in the days of Tiger (the original OS X), and I need to install the latest iteration: Snow Leopard. New cost: $152.43. No problem.
Whoops. Yes problem: The laptop hard drive is too crammed to take the upgrade. Ring up $30 for an 8-gigabyte flash drive. Spend 40 minutes loading video files from laptop onto the teensy flash device. Now wait 40 minutes more for Snow Leopard to land with little cat feet onto my suddenly unfettered hard drive.
Meantime, though, it occurs to me: I’m gonna need a bigger drive. Voila! Spend a few hundred bucks more for a massive, two-terabyte external drive from Western Digital. It holds 2,000 gigabytes in a slick grey box smaller than an old Webster’s dictionary.
But what about backing it all up? Ah, here comes a new Apple wi-fi set-up with router and wireless disk. It will automatically back up my laptop without my having to tell it to do so. That and the two-terabyte drive add another $870 or so.
With each purchase, a nice-guy techie holds my hand through the process. Instead of having to wait in line at a cash register, you hand your credit card to the helper, who swipes it through his wireless handheld and racks up the purchase.
I might have bought even more gear—How about some games? Or the new iPod Nano with the video camera?—but I had to leave for other commitments.
The financial upside of such doting service is abundantly clear. Apple’s flagship on Fifth Avenue is said to rack up annual sales of $35,000 per square foot, twice the metric at Tiffany & Co., which has a lot of products with far higher prices.
Apple’s own retail efforts are just small enough—still at less than 20% of total revenue at the company—that it hasn’t yet riled retailers such as Best Buy for essentially competing against them. Given the excellence inside Apple stores, compared with the shabby treatment we get at so many other electronics outlets, we’ll see how long that truce lasts.
More Kneale ...
Michael Moore Should MoveSave ObamaCare ... By Killing It
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95d13fc7a37da9a0ad75cc8b4129ff55 | https://www.cnbc.com/2009/09/29/lightning-round-nucor-dryships-st-jude-medical-and-more.html | Bucyrus International : “The easy money has been made,” Cramer said, “but there’s still upside.” He’s bullish on BUCY.
Medtronic : Go with St. Jude Medical or Abbot Labs instead, Cramer said.
VIDEO0:0000:00Lightning Round
DryShips : Sell DryShips, Cramer said.
Coinstar : Coinstar is a buy, Cramer said.
Signature Bank : Cramer likes SBNY, but he said the stock is too expensive at this level.
US Steel : Cramer said he prefers Nucor to US Steel.
Cramer's charitable trust owns Abbott Labs.
Call Cramer: 1-800-743-CNBC
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
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1eccaf61643c69b799ed3d6e2a724872 | https://www.cnbc.com/2009/09/29/major-us-firms-draw-up-emergency-plans-for-swine-flu.html | Major US Firms Draw Up Emergency Plans for Swine Flu | Major US Firms Draw Up Emergency Plans for Swine Flu
Major US companies are bracing for a potentially stronger strain of swine flu this year that could threaten the nation's already fragile economic recovery.
Experts say this second, potentially stronger strain of the H1N1 virus could significantly worsen the traditional flu season this year, which already costs US businesses an average $10 billion in lost productivity each year.
AP
So companies from International Business Machines to Caterpillar have developed emergency plans to keep their businesses running in case of a widespread swine flu pandemic.
“My concern would [be] that something bad would have happened, and then you’re left to scramble,” said Home Depot spokesperson Stephen Holmes.
Absenteeism is always the costliest issue associated with the flu, and this will continue to be the case with the H1N1 strain, said Matthew Eggers, manager of the U.S. Chamber of Commerce’s National Security & Emergency Preparedness Department.
As a result, companies such as Bank of America have put in place teleconferencing and telecommuting strategies to help keep up productivity for those who can’t make it to the office, but aren’t too sick to work.
Aerospace giant Boeing , for example, has examined the supplies it has available for working remotely, and spokesperson Kelly Donaghy said depending on the severity of the pandemic, it will consider ordering laptops for those who are able to do their work from home.
“I think the key is plan for the different scenarios and have multiple options, and be prepared for those multiple options,” Donaghy said.
Though it’s too early to predict how far the flu’s second wave will reach, World Health Organization official Aphaluck Bhatiasevi said in a statement that it could infect 15 to 45 percent of the US population. Therefore, even if it continues to infect people for only two to five days, this could significantly affect the workforce, Eggers said.
What’s more, since H1N1 tends to affect children more than adults, healthy parents could be forced to stay home to take care of their sick children.
“We want businesses to be prepared so they can take a punch and bounce back,” Eggers said.
Another safeguard against the traditional flu is vaccination, which companies such as Home Depot and Boeing have offered their employees free of charge for years. ExxonMobil and Coca-Cola also offer seasonal flu shots, and company spokespersons said they hope to offer H1N1 vaccines to employees when they become available.
While most firms' spokespersons said it's too early to stock up on facemasks, the majority of organizations have already bought mass supplies of hand sanitizer to disinfect employees — and, in the case of retailers like Home Depot , their customers, as well.
“Certainly in retail, you know, good health of your associates is critical, both for their own well being as well as their customers,” Holmes said.
Companies like Procter & Gamble evaluate the advisories put in place by the Centers for Disease Control to determine whether they should restrict travel to hot spots for illnesses. Boeing, for example, restricted travel to Mexico in the spring, when H1N1 fears first surfaced, Donaghy said.
Cutting back on travel was one contributor to the $40 billion in lost productivity suffered by the Asia-Pacific region when SARS hit in 2003, according to a report by the non-profit Council on Foreign Relations.
Along with these restrictions, many precautions companies are taking are an addition to already existing emergency plans, Eggers said.
IBM and Home Depot, for example, worked off the pandemic plans they put in place during the avian flu scare in 2005, while ExxonMobil — which employs about 14,000 people in the Houston area — equipped almost every employee with a laptop after the 2008 hurricane season caused a massive evacuation from the city, spokesperson Cynthia Bergman said.
CNBC Special Report: Healthy Horizons
“I think every time you go through an incident you always come away with lessons learned,” Bergman said.
On top of these tangible precautions, organizations such as BofA and ExxonMobil have set up Intranet sites specifically dedicated to monitoring prevention tips and advisories from credible sources such as the CDC and other credible agencies.
If for nothing else, this information quells fears that are sometimes heightened by media coverage, Donaghy said.
“I think what people were getting from the media [the first time around] was very confusing to them,” she said. “They were very worried, which made them ask questions about the safety of the work environment.”
Still, no amount of preparation companies do is ever enough, said Steve Brozak, president and co-founder of WBB Securities investment research firm, which focuses on health care issues.
Intranet sites are rarely updated as often as they should be, and even when the H1N1 vaccine becomes available, companies will have a difficult time acquiring enough of it — let alone finding a large enough medical staff to administer it, he said.
As for telecommuting, this will open up a number of security concerns for major corporations, especially those such as Bank of America that safeguard highly secretive information.
“You increase the number of people who have remote access to your systems, and you will have an exponential increase in unauthorized access,” he said.
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f338f0ee5fc06ede59ee08374f018ad8 | https://www.cnbc.com/2009/09/29/new-banking-regulations-will-cost-consumers-bove.html | New Banking Regulations Will Cost Consumers: Bove | New Banking Regulations Will Cost Consumers: Bove
Consumers will end up paying more money to banks if the numerous regulations proposed for the financial sector come to fruition, said Dick Bove, financial strategist for Rochdale Securities.
Wallet
"The one thing that the consumer can be absolutely certain of is that the cost of financial products — credit cards, home equity loans, mortgages — are going to go higher," Bove told CNBC.
On top of the possibility of creating a consumer protection agency, the Federal Reserve on Tuesday proposed stricter credit card rules, which would prohibit an increase in interest rates the first year an account is opened. The rules would also ban increases in rates that apply to an existing balance.
VIDEO0:0000:00FDIC Approves Fund Replenishment
Also Tuesday, the FDIC suggested banks prepay three years worth of fees to help fund the cost of bank failures, which have risen from 25 last year to 95 already in 2009.
While Bove said there is no question that the banks, not the taxpayers, are responsible to pay these fees, he said it isn't the right time for the government to make a move.
"The lunatic's running the asylum right now," he said. "They're really moving a lot too agressively to stop the banks from lending, even though they claim they want the banks to lend more."
Bove also said that contrary to what was said at last week's G20 Summit, it makes no sense for banks to increase their capital at this time.
"The banks have never had this much capital as a percentage of assets, so to ask them to increase their capital at this point is simply asking for the economy to be hit," he said.
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a3e68e0dec14420f6b3450f7b496577c | https://www.cnbc.com/2009/09/29/out-from-indias-alleys-gold-loans-gain-respect.html | Out From India’s Alleys, Gold Loans Gain Respect | Out From India’s Alleys, Gold Loans Gain Respect
Indians own more gold than the citizens of any other country. They use the glittering metal as ornaments to flaunt family wealth, as a source of retirement savings and as insurance against calamities.
But lately, gold has become something else: collateral, and the basis of one of the country’s fastest-growing businesses, gold loans.
People buying Gold Jewellery at Tribhovandas Bhimji Zaveri in New Delhi, IndiaIndia Today Group | Getty Images
While pawning the family jewels would be a sign of distress in the West, trading gold for cash increasingly is viewed in India as the equivalent of taking out a home equity loan to expand a business or simply to buy things.
“This is the rural credit card,” said V. P. Nandakumar, chairman of the Manappuram Group, one of the country’s biggest gold loan companies. “This is the only way really that someone gets an instant loan within three minutes.”
But loans against gold are also a measure of how immature — and restricted — India’s credit markets are.
Most Indians, especially those working in the informal economy, which accounts for 92 percent of the country’s 400 million workers, have few choices when they need to borrow money: they lack other collateral or have no documents to prove their incomes.
Gold loan firms have also benefited from the financial crisis. In the last year and a half, many lenders have stopped making unsecured personal loans here because of rising defaults in India.
It is now “a lot more palatable for banks to give loans against gold jewelry,” said Viren H. Mehta, a national director at Ernst & Young India. As a result, for borrowers like Vishwanathan C. R. Pai, a rickshaw repairman, gold loans are an essential financial tool.
He frequently hands over his family’s jewelry at Muthoot Finance to pay operating expenses for his business. He often borrows 10,000 to 25,000 rupees ($200 to $500) to buy spare parts, repaying the loans when customers pay him.
He pays 15 to 18 percent interest.
Mr. Pai said he couldn’t get a business loan from banks because they wanted documentation of his income. But his customers, who earn as little as $100 a month, don’t do checks and invoices.
“It is very easy here, there are no formalities,” Mr. Pai, 29, said about borrowing at Muthoot.
As recently as a decade ago, people like Mr. Pai who needed cash had to turn to relatives or moneylenders. India’s mostly state-controlled banking system rationed credit tightly, lending mostly to the wealthy or to industries with government backing.
Pawnbrokers and money lenders have long operated in India’s back alleys, making loans against jewelry to families in distress, at interest rates of 30 percent or more. But gold loans made by banks and finance companies are different. Rates are lower — 14 to 30 percent — and their businesses are regulated.
There are no publicly available aggregate data about gold loans, but finance companies that specialize in them are growing fast. Manappuram, a pioneer in the business, made $730 million in gold loans last year — up from $397 million a year earlier.
Muthoot Finance, a privately held firm, says its lending is growing at 60 percent a year.
By contrast, total outstanding bank loans to the private sector increased 16 percent last year, year over year, and have been essentially flat so far this year.
Though the financial system here has become more inclusive, it still doesn’t reach many people. More Indians, for instance, own gold than own stocks or mutual funds. The total value of gold in private hands is roughly 60 percent of deposits in banks, according to data from the World Gold Council and India’s central bank. A 2006 government survey found that less than 41 percent of Indian households had bank or post office savings accounts. By contrast, 92 percent of American households have bank accounts.
Historically, many Indians bought gold because they lived too far from bank branches and because high inflation devalued their rupees. This, economists say, kept the equivalent of billions of dollars in savings out of the financial system where it could have been lent out to build factories and pay for homes.
Even though interest rates are still high and these loans don’t help the truly poor who have little or no gold, analysts say they do represent progress of a sort, allowing families to leverage some of their most valuable assets for productive uses.
“It brings a lot of people into the financial system,” said Rajesh Chakrabarti, a finance professor at the Indian School of Business in Hyderabad.
Gold loans, so far at least, have very low defaults — companies say fewer than 1 percent of borrowers fail to repay. Most jewelry is reclaimed in less than four months.
“Most people who pledge the gold intend to take it back,” said Subhasri Sriram, executive director of Shriram City Union Finance, a Chennai-based finance company.
Mr. Pai laughed when asked what would happen if he couldn’t reclaim the necklace he had recently pledged. “I have to get it back,” he said, “otherwise my wife won’t let me back in the house.”
When borrowers don’t repay, their gold can be easily sold for more than the value of the loan.
Still, the lenders do have some risk: for instance, the price of gold, which recently surged past $1,000 a troy ounce, could fall more sharply than some lenders are prepared for.
Executives say their business has grown because new financing methods and economic liberalization have made it easier for them to raise money.
Securitization — the packaging and selling of loans that became so popular in the American mortgage market, and wreaked such global havoc — has made it possible for lenders here to quickly “redeploy” money, said Mr. Nandakumar.
His father started Manappuram as a small pawnshop in a village an hour and a half north of Kochi in 1949. Now, the company is listed on the Bombay Stock Exchange, its stock is up more than 200 percent this year and it has shareholders like Sequoia Capital, the Silicon Valley investment firm.
Banks and finance companies that make gold loans compete aggressively on interest rates, how much money they’ll lend against each gram of gold, and even how quickly they’ll approve loans.
At Manappuram’s first village branch, an appraiser sat in an enclosed wooden cubicle with a tiny window. When a woman showed up with a broken gold bangle it took him just two minutes to determine that he could lend her 3,430 rupees, about $71, for three months at an annual rate of 29 percent.
The woman, Bindu Sunil Kumar, took the loan, though she later grumbled to a reporter that the interest rate seemed high. She said she could get a lower rate elsewhere, but she wouldn’t be able to borrow as much.
When asked what she would do with the money, Mrs. Kumar giggled and looked at her husband, Sunil, who smiled.
Even though gold loans have become more popular, many are still embarrassed about using them. Many customers still view gold loans “as a desperate loan, a loan of the last resort,” said George Alexander Muthoot, the managing director of the Muthoot Group. “We’ve been trying to change that perception into a smart loan product.”
CNBC Slideshows
Most Expensive Rare U.S. CoinsWorld's Most Beautiful Currencies
Mr. Muthoot and his rivals are confident that they have just begun to mine the market. He estimates that just 600 tons of the 15,000 tons of gold Indians own has been borrowed against so far. “There is another 14,000 tons of gold waiting to be tapped,” he said. “It’s just lying there.”
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2dafe77f1970d043644ac44f7281fd02 | https://www.cnbc.com/2009/09/29/schork-oil-outlook-driving-trends-may-be-indicator-to-economic-recovery.html | Schork Oil Outlook: Driving Trends May be Indicator to Economic Recovery | Schork Oil Outlook: Driving Trends May be Indicator to Economic Recovery
Over the summer, we considered May’s Vehicle Miles Travelled (VMT) figure as an indicator for the state of the economy and gasoline demand. High VMT would imply increased economic activity and job-related travel. At the time, May’s figures were less than bullish, and we stated in the July 27th issue of The Schork Report:
“In real terms, annual VMT has been decreasing from a peak of 3.04 trillion (×1012) miles in November 2007 to 2.93 trillion in November 2008. So May’s 0.07% increase in VMT over May 2008 is less bad instead of good” July’s Vehicle Miles Travelled (VMT) figures were released last week, with total miles driven clocking in at 263.4 billion miles, up 2.3% from July 2008. That is a solid increase, but keep in mind, gasoline prices have decreased by 38% since last year. Further, July 2008’s VMT figure was 3.5% lower than July 2007. Therefore, this year’s “increase” was 1.3% below 2007 and 0.5% below the 03-07 timestep, thereby continuing that steady VMT decline.”
Carbon Trading May Dwarf That of Crude Oil
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a7f4457ca71afcc765d19d2e09b40aac | https://www.cnbc.com/2009/09/29/sec-inspector-general-suggests-postmadoff-reforms.html | SEC Inspector General Suggests Post-Madoff Reforms | SEC Inspector General Suggests Post-Madoff Reforms
The internal watchdog at the Securities and Exchange Commission is recommending dozens of reforms at the agency following its failure to detect the Madoff Ponzi scheme.
David KotzAP
SEC Inspector General H. David Kotz issued two reports Tuesday. One is aimed at the SEC's Division of Enforcement, the other at the Office of Compliance Investigations and Audits—known as OCIE. The reports can be viewed here.
"What we wanted to do in our reccomendation report is really to go in the weeds and specify procedures to ensure that the SEC conducts appropriate thourough, comprehensive investigations and examinations," Kotz told CNBC.
The recommendations—21 for the Division of Enforcement and 37 for OCIE—come one month after Kotz issued a scathing, 500-page report on the SEC's multiple failure in the Madoff case, some dating back a decade.
The reports note that the staff of both divisions generally concur with the recommendations. An SEC spokesman declined further comment.
Many of the recommendations are basic. In the report on the Enforcement Division, for example, Kotz recommends procedures "to ensure that investigations are assigned to teams where at least one individual on the team has specific knowledge of the subject matter (e.g. Ponzi schemes)."
Kotz had found that various investigations of Madoff—there were at least half a dozen over the years—were hampered by the lack of experience among some of the investigators.
Several recommendations in the OCIE report address the failure of examiners to verify statements by Madoff and his counterparties. And the report recommends that examiners be trained on the mechanics of settling trades.
Kotz has given the divisions 45 days to respond with specific plans for reforms.
Slideshow: A Rogues Gallery of Financial Crime
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8b0e21b2f2fd062578783a80a4d37c79 | https://www.cnbc.com/2009/09/29/sequenom-board-to-ceo-youre-fired.html | Sequenom Board To CEO: "You're Fired" | Sequenom Board To CEO: "You're Fired"
SequenomCNBC.com
It's the equivalent of slipping a press release with negative news under the door at the close of business on a Friday.
But after the closing bell on Yom Kippur, when many people including me were trying to give up food and tweeting for a day, Sequenom tossed a grenade.
But the real headline doesn't appear in the press release until the fourth paragraph. The board fired the CEO and head of R & D plus three other staffers. The CFO and another exec quit.
The top of the release talks about how an internal investigation revealed Sequenom messed up big time in disclosing clinical trial data from its experimental diagnostic test for Down syndrome. There are no details. And then it went on to list bullet points about steps the company's taking to prevent it from happening again before finally disclosing the C-suite bloodbath.
On CNBC.com - Best American CEOs of All Time
What's more, at a time when some of us were about to break the Yom Kippur fast, Sequenom scheduled a conference call at 5 p.m. ET yesterday. Needless to say, I didn't listen to it. I felt guilty enough that I had tweeted the newsand violated my self-imposed high holiday electronic disconnection.
This morning Leerink Swann, whose specialty is healthcare stocks, stopped coverage of SQNM because the future of the company looks so uncertain. And Lazard Capital Markets told clients in a research note, "What concerns us: Basically everything." Ouch.
It seems to me that a tiny biopharma company that is in the midst of a huge crisis of confidence and credibility could do better than to try to sneak out a bombshell of a press release at the end of the quietest day of the year for observant Jews. It doesn't help.
Questions? Comments? Pharma@cnbc.com and follow me on Twitter at mhuckman
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bbf1136f386187c6f1522379d2ed15ee | https://www.cnbc.com/2009/09/29/slow-money-trade-najarians-utility-play.html | A year ago -- as the Dow plunged a staggering 700 points in one day – stocks weren’t the only things left bloody and beaten.
The confidence to buy and then hold stocks went out the window, too.The strategy for making money on Wall Street shifted sharply. No longer was this an investors market but one much better suited for traders. And though that’s not untrue, as it turns out, waiting out this collapse may have served you well, too.
Stocks are back at their highest levels in 11 months and the S&P 500 about to close out its best quarter in 10 years.
As the pendulum swings back -- and the strategy of buy-and-hold goes from ‘not’ to once again, ‘hot” – we asked the Fast Money traders for their best long term picks.
Pete Najarian suggests PG&E, California’s largest utility.
I like the growth potential going forward in solar and the 4% dividend they pay out, he says. And I love their clean energy initiatives they have underway. It just seems they’re pushing in the right direction for the long haul.
Want more Slow Money trades? We've got them!
Check our website on Thursday October 1st for the premiere of a complete list of all our traders’ favorite ‘slow money’ picks.
______________________________________________________Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send those e-mails to .
Trader disclosure: On Sept. 29th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Terranova Owns (KCE), (F), (ABT), (XOM), (SUN); Terranova Is Short (CCL), (ESS); Grasso Owns (AAPL), (ABK), (BAC), (C), (COST), (CSCO), (PFE), (V), (MMT); Finerman's Firm Owns (BAC) Preferred Shares, Finerman Owns (BAC) Preferred Shares And Owns (BAC); Finerman's Firm Owns (WFC) Preferred Shares And Is Short (WFC); Finerman Owns (WFC) Preferred Shares; Finerman Owns (RIG); Finerman's Firm Owns (MSFT), (NOK), (PBR), (WMT), (RIG), (TGT), (PLCE); Finerman's Firm Is Short (IJR), (MDY), (SPY), (IWM), (USO), (UNG); Najarian Owns (ACI) Call Spread; Najarian Owns (C) Calls; Najarian Owns (DELL) Call Spread; Najarian Owns (ERTS) Call Spread; Najarian Owns (GE) Calls; Najarian Owns (JPM) And Is Short (JPM) Calls; Najarian Owns (MS) And Is Short (MS) Calls; Najarian Owns (MSFT) And Is Short (MSFT) Calls; Najarian Owns (RIMM) Call Spread; Najarian Owns (ORCL); Najarian Owns (TEVA); Najarian Owns (V) And (V) Calls; Najarian Owns (WFC) Put Spread; Najarian Owns (YHOO) Call Spread ; Najarian Owns (BIIB) Calls
For Steve GrassoStuart Frankel Owns (ACS) Stuart Frankel Owns (GERN) Stuart Frankel Owns (MSFT) Stuart Frankel Owns (NWS.A) Stuart Frankel Owns (NYX) Stuart Frankel Owns (PDE) Stuart Frankel Owns (PFE) Stuart Frankel Owns (ROK) Stuart Frankel Owns (XOM) Stuart Frankel Owns (SDS) Stuart Frankel Is Short (QQQQ)
For Greg TroccoliTroccoli Is Short S&P 500 Troccoli Owns US Dollar CNBC.com with wires
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4d8220880742c18dd797f14de82ace7f | https://www.cnbc.com/2009/09/29/strategist-sees-real-topline-growth-in-q1-2010.html | Strategist Sees 'Real' Topline Growth in Q1 2010 | Strategist Sees 'Real' Topline Growth in Q1 2010
The quarter ends on Wednesday and so far, 197 companies have posted positive outlooks while 282 companies posted negative. Will earnings be the market’s next challenge or are expectations so low that it will end up being a blow-out quarter? Craig Peckham, equity trading strategist at Jefferies & Co., and Ashwani Kaul, global head of research at Thomson Reuters, shared their insights.
VIDEO0:0000:00Earnings: Low Expectations?
“Expectations have been ratcheted up but companies are going to outperform analysts’ expectations,” Kaul told CNBC. “It will be the second quarter where they’ve done it.”
Kaul said topline growth in companies is still missing and projects an 11 percent decline in revenues. But that should change in 2010, he predicts.
“The first quarter of next year, we’re finally going to start seeing real topline growth,” he said. “We’re looking at 7.5 percent topline growth for the first quarter of 2010.”
Kaul said sectors that will do well include consumer discretionary and financials, while sectors that will disappoint include energy, materials and industrials.
In the meantime, Peckham said the second quarter was driven entirely by cost production that was greater than most analysts had expected.
“You didn’t see the kind of topline positive variance that the market is hoping to see more of in the third quarter,” he said. “It boils down to a question of earnings quality, and that quality really dictated by what you see happen in the revenue streams in the third quarter.”
Peckham said he expects the tech and consumer discretionary sectors will do well and warned investors against oil services and utilities companies.
3 Hot Consumer Stocks: Portfolio ManagerCharts: S&P May Hit 1,157 but Momentum Is Waning
______________________________ Disclosure:
No immediate information was available for Kaul or Peckham.
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Dell
Dell Says Strong Sales Growth to Drive China Share
______________________________
Disclaimer
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e1ceb96324875b4b9e8954a23a455cfb | https://www.cnbc.com/2009/09/29/toyotas-fight-to-maintain-a-safe-record.html | Toyota's Fight to Maintain A Safe Record | Toyota's Fight to Maintain A Safe Record
When the Toyota first announced a safety alert warning the owners of 3.8 million Toyota and Lexus models of a potentially deadly flaw, two questions crossed my mind. First, how serious is this problem to fix? Second, how much will this stain Toyota's sterling reputation for safety and reliability? The answers bring good and bad news for Toyota.
Toyota.David Zalubowski
First, the fix for a potentially fatal design flaw where floor mats become loose and lodge under the accelerator is an easy one. You take out the floor mat, problem solved. Sure, Toyota runs the risk some people will pooh pooh the possibility of their floor mat being a threat and they'll ignore the alert. That would be a huge mistake, but one that is beyond Toyota's control. So almost immediately, Toyota has taken the step to eliminate a safety concern.
The second questions is a bigger problem for Toyota. Sure, you can look at this safety alert and say, "come on, it's a floor mat. It's not as if Toyota built the Corvair." That's true. But listen to the 911 call of a man driving a car that keeps accelerating in California and you'll realize why Toyota issued this safety alert and held a hastily arranged conference call Wednesday afternoon. Toyota suspects, but has not officially determined that the floor mats in the car became stuck under the gas pedal. The call is chilling in part because we can all imagine ourselves in the same exact situation.
Which brings up the safety and reliability reputation of Toyota. For decades, it has been held up as an example of how a company rarely makes mistakes, and when it does, they usually are not huge ones. Now, with the safety alert of 3.8 million vehicles, people will ask a few more questions about Toyota. Nobody will accuse the company of purposely designing floor mats and an gas pedal that could be deadly combination- nor should they. Still, the words 3.8 million, safety alert, and run-away acceleration will now be linked to Toyota.
Bookmark Alert: Track All the Dow Transports
_____________________________________Click on Ticker to Track Corporate News:
- Ford Motor
- Toyota Motor
- Nissan
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_____________________________________
Questions? Comments? BehindTheWheel@cnbc.com
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724f67bd41bd74fc1eb11d6b11b80b64 | https://www.cnbc.com/2009/09/29/ultimate-fighting-ceo-were-just-scratching-surface.html | Ultimate Fighting CEO: We're Just Scratching Surface | Ultimate Fighting CEO: We're Just Scratching Surface
UFC co-owner and president Dana White told CNBC Tuesday that his ultimate fighting organization is ready to be more popular than ever.
VIDEO0:0000:00UFC: A Fistful of Dollars
"We're just scratching the surface of this thing," White said. "When you look at this as a sports franchise, we've only been around for nine years and on television for five. We're just chipping away with this."
UFC is seen on Spike TV in the US and also on pay per view channels and seen in some 33 countries. White said he's not worried about any overexposure. "As long as we provide good fights, you're not overexposed," White said.
White said regular boxing killed itself in the media by being short-sighted. "They got greedy," White said. "Boxing promoters and others just wanted to make money. While we're on pay TV, we're also providing free fights on TV."
"Fighting is in our DNA," White said. "It's always going to be around."
Ultimate Fighting Championship promotes itself as a no holds barred fighting arena and uses all forms of fighting in its contests, including judo, kick boxing, karate and wrestling.
"The Ultimate Fighter" TV program has been seen by 106.9 million viewers in the last four years. UFC has the highest average ticket prices per event at $276 each.
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268c049f77bf5453c202b60375636885 | https://www.cnbc.com/2009/09/29/us-economy-needs-second-stimulus-wilbur-ross.html | US Economy Needs Second Stimulus: Wilbur Ross | US Economy Needs Second Stimulus: Wilbur Ross
The US economy needs another cash infusion to take off, as the first stimulus package was insufficient to help the US consumer start spending, and longer-term it needs to devalue the dollar, investor Wilbur Ross told CNBC Tuesday.
President Barack Obama's efforts to kick-start the economy by programs such as cash for clunkers need to be followed by "more dramatic" efforts, Ross told "Squawk Box."
"The consumer is about 70 percent of the economy and is still disabled. The consumer can't borrow… and I believe that Obama will have to go for another stimulus package, probably in the spring, because I don't think unemployment is going to get that much better by then," he said.
VIDEO0:0000:00Politics, Markets & the Economy
The dollar should probably be devalued because the US is less competitive than other economies and has higher debt, and "some form of SDR" should become the world's reserve currency, according to Ross.
"I think the way out of it, frankly, is going to be the devaluation of the dollar. The tricky question is :where is the strong currency against which we devalue?"
Although earnings were better than expected in the last quarter, companies will continue to face hardship. (Click on the video on the left for more Ross comments)
"I really think that corporate America is doing better than economic America. Mostly it's the flip side of the joblessness. Company earnings I think are going to continue to outperform the economy for a little while," Ross said, but added that consumers are "more leveraged now than at the peak of the boom" because the value of their assets fell.
"I think it's really going to be that we will continue the massive transfer of liabilities from private sector to public sector" and this is how the economy will deleverage, Ross said.
Some analysts and politicians have said that the $787 billion, two-year stimulus package approved in February will take time to work its way through the economy and no more money was needed.
Wilbur Ross
"There will be more spent but I really don't think it's going to solve the consumer problem. Real unemployment is around 12.8 percent because people who've given up looking for a job don't count as unemployed, but they are," Ross explained.
Expand PPIP
Meanwhile, the government's Public-Private Investment Program, which offers private investors the chance to buy toxic assets, should be expanded, Ross said.
"Unfortunately it (the PPIP program) has become very small. It was mean to be a trillion now unfortunately it won't even be 100 billions of it," he said, adding that for investors this was good because they don't have to find the funds to finance the purchase of assets, but for the government the program does not meet its purpose.
Ross's company Invesco is among the firms the government selected earlier this year to help get toxic assets off the balance sheets of troubled banks and has bid $1 billion in an auction which is closing Wednesday and in which bids are matched 50-50 by TARP money.
"It's very clever in that it gives the government the upside of it and it also gives some downside because we're matching it with private funds," Ross said.
"I hope the PPIP program will work sufficiently well that they'll decide to expand it back," he added.
Slideshow: Central Banker Report Cards
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0a49c005f158c00870883ed37a74cba9 | https://www.cnbc.com/2009/09/29/what-do-nike-earnings-mean-for-market.html | After hours, the traders poured over the earnings report from Nike looking for insights into Wednesday’s market action as well as trading opportunities in retail apparel.
AFTER HOURS ACTION: NIKE
Nike shares climbed about 3% in extended trader after the apparel maker reported a profit that topped analysts expectations.
Nike said it earned $1.04 a share in its fiscal first quarter on sales of $4.8 billion, compared with $1.03 a share on sales of $5.43 billion in the same period last year
However, it's worth noting that Nike's largest market is in the U.S., where shoppers are still keeping a lid on discretionary spending and specialty athletic retailers that emphasize the Nike brand are struggling.
VIDEO0:0000:00Word on the Street
What’s the trade?I really like what I’m seeing in this report, says Joe Terranova. I think this is good news for the company and the market overall.
I think what Nike says could be indicative of what to expect from Foot Locker as well as retail in general, says Karen Finerman.Forget the derivative play, counters Steve Grasso, I think the trade is long Nike.
> For complete coverage of Nike earnings click here
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SAKS ANNOUNCES SHARE OFFERING
After hours Saks said it is offering up to $100 million in common stock, and its shares fell over 4 percent in after-hours trade.
The company, known for selling designer brands, said it would use proceeds from the offering to pay down debt and for general corporate purposes.
Saks said in the filing with the U.S. Securities and Exchange Commission that it had roughly 138.3 million shares of common stock outstanding as of Sept. 28, and long-term debt and lease obligations of about $662.9 million as of Aug. 1.
What should you know?
They do have a lot of debt so anything that can do to repay the debt should help, muses Karen Finerman.
I think raising money now is considered weakness, counters Steve Grasso. It says the balance sheet is not sound.
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STOCKS LIMP INTO TOMORROW’S QUARTER-END
Both the Dow and S&P closed modestly lower on Tuesday after the latest figures showed consumer confidence not only fell unexpectedly in September, but more Americans consider jobs “hard to get.”
The data suggests that despite improvements in the economy, it could be a long time before consumers contribute to growth. “With the holiday season quickly approaching, this is not very encouraging news," says Lynn Franco, director of the Conference Board Consumer Research Center.
What must you know?
Consumer confidence surprised me, says Joe Terranova. It’s all about jobs and we’ll find out more about that on Friday.
I don’t make much out of consumer confidence, adds Karen Finerman. It’s not a forward looking indicator.
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TOPPING THE TAPE: MORE SIGNS OF LIFE FOR HOMEBUILDER
On a bullish note, D.R Horton , Toll Brothers and other homebuilders showed gains after an improved S&P/Case-Shiller home price index reading, suggested the housing market was bottoming out.What’s the trade?
I’m not sure if I’d establish a long-term position in this sector, says Joe Terranova, at least not yet.
I don’t think we’re out of the woods yet either, says Pete Najarian.
But it’s also important to note interest rates, says Karen Finerman. Right now rates are low, that’s a big positive.
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CHART OF THE DAY: OIL’S DUD QUARTER
U.S. crude oil futures closed lower on Tuesday dragged down by demand concerns and a stronger dollar. Despite geo-political concerns about Iran's nuclear program, the commodity could not rally.
Instead traders appeared much more focussed on weekly inventory data, which is forecast to show that supplies are rising.
What’s the trade?
I’m concerned to see oil is trading lower in a quarter when equities are higher, muses Joe Terranova. It seems to me that investors want exposure to oil but they’re staying away from the commodity itself fearing regulation. However I do think that by the end of the year we’ll see oil near $85.
I think we’re at a key moment in oil, adds Summit energy analyst Brad Samples on Fast Money’s Halftime Report. If we see oil break lower on big inventories we could see oil go to $55. I think it’s okay to short crude.
My fear is a spike or drop that’s very dramatic, muses Karen Finerman. That could spook investors. If the climb or fall is slow and steady that’s okay. And if you want to trade the space, I’d do it with Transocean.
In this space I’d look at ConocoPhillips for its refinery business and also BP as a strong integrated name.
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SECTOR TRADE: A SECTOR DIVIDED CANNOT STAND
Capital One led credit card names lower after the Federal Reserve proposed tough new credit card rules to protect consumers from potentially costly practices by lenders and moved to implement legislation enacted in May.
Among the more controversial proposals is one that would prohibit creditors from issuing a card to anyone under the age of 21 unless the borrower has either the ability to make the required payment, or has the signature of a parent or other co-signer who has the means to do so.
What’s the trade?Keep in mind these are proposals for new rules, explains Patty Edwards on Fast Money’s Halftime Report. In the space I like Visa as well as MasterCard . I bet if the rules pass we’ll see more debit cards and that’s good for Visa and Mastercard.
Meanwhile, boutique firms are climbing on chatter of new pay curbs at banks after world leaders at the G20 summit said bank executives should not be guaranteed multiyear bonuses because such compensation makes them less accountable for risky investments.
What’s the trade?
Of all the names in the boutique space I like Lazard best,, says Pete Najarian.Or play it with KCE, adds Joe Terranova.
______________________________________________________Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send those e-mails to .Trader disclosure: On Sept. 29th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Terranova Owns (KCE), (F), (ABT), (XOM), (SUN); Terranova Is Short (CCL), (ESS); Grasso Owns (AAPL), (ABK), (BAC), (C), (COST), (CSCO), (PFE), (V), (MMT); Finerman's Firm Owns (BAC) Preferred Shares, Finerman Owns (BAC) Preferred Shares And Owns (BAC); Finerman's Firm Owns (WFC) Preferred Shares And Is Short (WFC); Finerman Owns (WFC) Preferred Shares; Finerman Owns (RIG); Finerman's Firm Owns (MSFT), (NOK), (PBR), (WMT), (RIG), (TGT), (PLCE); Finerman's Firm Is Short (IJR), (MDY), (SPY), (IWM), (USO), (UNG); Najarian Owns (ACI) Call Spread; Najarian Owns (C) Calls; Najarian Owns (DELL) Call Spread; Najarian Owns (ERTS) Call Spread; Najarian Owns (GE) Calls; Najarian Owns (JPM) And Is Short (JPM) Calls; Najarian Owns (MS) And Is Short (MS) Calls; Najarian Owns (MSFT) And Is Short (MSFT) Calls; Najarian Owns (RIMM) Call Spread; Najarian Owns (ORCL); Najarian Owns (TEVA); Najarian Owns (V) And (V) Calls; Najarian Owns (WFC) Put Spread; Najarian Owns (YHOO) Call Spread ; Najarian Owns (BIIB) Calls
For Steve GrassoStuart Frankel Owns (ACS) Stuart Frankel Owns (GERN) Stuart Frankel Owns (MSFT) Stuart Frankel Owns (NWS.A) Stuart Frankel Owns (NYX) Stuart Frankel Owns (PDE) Stuart Frankel Owns (PFE) Stuart Frankel Owns (ROK) Stuart Frankel Owns (XOM) Stuart Frankel Owns (SDS) Stuart Frankel Is Short (QQQQ)
For Greg TroccoliTroccoli Is Short S&P 500 Troccoli Owns US Dollar
CNBC.com with wires
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170f86a0835ef223b4f4d331fdac1edc | https://www.cnbc.com/2009/09/29/where-to-invest-now-stock-pickers.html | Where to Invest Now: Stock Pickers | Where to Invest Now: Stock Pickers
Stocks seesawed Tuesday, so where should investors be looking to put their money? David Stepherson, senior portfolio manager at Hardesty Capital Management, and Neil Hennessy, portfolio manager and CIO of Hennessy Funds, shared their strategies.
“The market is fairly valued here compared to 2009 and where we are in the economic cycle,” Stepherson told CNBC.
VIDEO0:0000:00CNBC Market Edge
“[But] the market becomes much more attractive. So in general, the market is fairly valued but there’s more to go in 2010 if the economy continues to improve.” (Read below for Stepherson's stock and sector picks.)
In the meantime, Hennessy said although consumers are slowly returning, they are not necessarily coming back to the once sought high-end retailers.
“They’re in the middle to low-end,” he said. “People are understanding how to spend their money better and they’re saving at the same time. It’s going through a lot of different sectors, not just the retail sector.”
More CNBC Market Intelligence:
Charts: S&P May Hit 1,157 but Momentum Is Waning3 Hot Consumer Stocks: Portfolio ManagerThe Gold Boom: 4 Ways to Trade It
Hennessy said companies are acquiring information solutions to replace the numerous staff positions lost during the layoffs in the last year.
“They’ve laid off all their employees and now it’s time to improve their margins and you can do that through technology that’s already existing,” he said. “So a lot of money is going to be spent on the information technology.”
Companies like Broadridge Financial Solutions, Automatic Data Processing, Computer Sciences should benefit, Hennessy said.
However, other than the companies above and other solutions to technology for companies, Hennessy said he would avoid the technology sector.
Stepherson Likes:
Google
Technology
Financials
Energy
Some Industrials
______________________________ Disclosures:
No immediate information was available for Hennessy or Stepherson.
______________________________CNBC Slideshows:
America's Biggest Types of Personal Debt
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Disclaimer
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a90b7d46f5868716670575911e7d21ab | https://www.cnbc.com/2009/09/29/why-ma-is-not-driving-this-market.html | Why M&A Is Not Driving This Market | Why M&A Is Not Driving This Market
Futures higher on Case Schiller Home Price Index: July S&P/Case-Shiller 20 City Home Price Index comes in at 144.23, a higher number than expected and the highest level for the index since January 2009. The index is up 1.61 percent from the June levels.
Prices are down 13.3 percent year over year, also less than expected and the smallest decline since February 2008.
The index is not seasonally adjusted.
Once again, the market leaders-commodity stocks, industrials, financials and tech stocks-reasserted themselves yesterday. The markets were higher, even though the dollar was stronger.
The argument that the market advanced on merger news is silly: the important point is that the market has bounced at least three times on the modest 2 to 4 percent pullbacks that we have seen since June, so it is simply continuing a trend.
Elsewhere:
1) Walgreen rises 7 percent after its Q4 earnings topped estimates ($0.40 vs. $0.39 est.) as stronger pharmacy margins helped boost the drugstore's overall gross margins. The chain's same-store sales were up 2.4 percent in the quarter, thanks in large part to a 4.5 percent rise in prescription same-store sales. Stronger prescription sales, however were offset by a 1.4 decline in general merchandise comp. store sales.
2) Gannett up 23 percent pre-open; its Q3 earnings will exceed current analyst forecasts. The media publisher sees Q3 EPS between $0.39 and $0.42 vs. $0.28 consensus estimate. as continued cost cuts including "significantly lower newsprint expense" helped.
Still, the media giant cautioned that "overall advertising revenue comparisons remain difficult" as expected revenues of $1.31 billion and $1.32 billion are short of the Street's forecast of $1.38 billion.
3) JP Morgan's Jamie Dimon, noting that this was the right time to begin the succession process, is shuffling his senior management around a bit. Among several changes, Steve Black, co-CEO of the Investment Bank, will become Executive Chairman of the Investment Bank; replacing him as CEO of the Investment Bank will be Jes Staley, currently head of Asset Management.
Bottom line: big win for Jes Staley. Investment banking has been a huge outperformer, and anyone running investment banking is in line to succeed Dimon.
4) CIT up 15 percent pre-open on heavy volume as the NY Post reported that hedge fund manager John Paulson was considering merging CIT Group with IndyMac Federal Bank (IDMCQ), though there are no formal discussions going on.
Paulson was part of a consortium that bought IndyMac from the FDIC earlier this year and also owns CIT debt. IndyMac does only mortgage loans, whereas CIT is one of the largest lenders to mid- and small-size businesses. CIT bondholders are meeting on Oct. 1 to work out a restructuring plan.
5) Fannie Mae saw a rise in mortgage delinquencies in July. Delinquent mortgage payments that were at least 90 days behind rose from 3.94 percent in June to 4.17 percent in July.
6) REIT IPOs keep coming: Chesapeake Lodging Trust filed for an initial public offering of $460 million; the company is organized as a real estate investment trust (REIT) and will invest in high-end hotels in major business, airport and convention markets. No word on when the IPO will be floated.
7) The Chinese are everywhere: the FT reported that CNOOC , the Chinese state-owned oil company, is in talk with Nigeria to buy large stakes in some of the largest oil blocks there. They have been buy commodity assets all over the globe in an effort to lock in access to commodities considered vital to their continued growth.
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The Dow 30 in Real TimeHome Prices Continue to Rebound; Up 1.2% in JulyUS Economy Needs Second Stimulus: Wilbur RossThe CNBC Stock Blog
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Questions? Comments? tradertalk@cnbc.com
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2618c2da2d794f0bd673ab563126cee9 | https://www.cnbc.com/2009/09/29/youtube-and-warner-music-finally-overcome-their-differences.html | YouTube and Warner Music Finally Overcome Their Differences | YouTube and Warner Music Finally Overcome Their Differences
YouTube and Warner Music Group have been stuck in a stand-off since December, when Warner pulled all of its artists' clips - both professional music videos and user-generated content using its songs - from the site.
Warner Music Group's complaint: it wasn't adequately compensated for its content. The two companies have finally reached an agreement to license Warner Music Group's music and video library, through a revenue sharing deal, a deal I broke on CNBC earlier today.
VIDEO0:0000:00YouTube, Warner Music Announce Deal
The deal is a multi-year, global deal that covers the music label's full catalog, including both official music videos as well as user-generated content that includes Warner Music songs.
It's a pure revenue-sharing deal - unlike some deals where companies have to pay an upfront licensing deal - and Warner Music Group gets to sell its own ad revenue.
Now that YouTube has nailed down a deal with Warner Music Group, the video sharing site has the right to run - and profit from - music from all four major music labels and publishers. No longer will YouTube have to pull clips of kids dancing to a Madonna song from its site; nearly all music use on the site is legit. This is yet another sign that YouTube is shifting from being a rogue threat, to being a legit revenue-generating distribution mechanism. The music industry needs all the help it can get, so why not find a deal with YouTube that works? And now YouTube is working to restore videos it had to pull down nearly a year ago.
Slideshow: Highest Grossing Concert Tours of 2008
YouTube tells me it's working on a premium video channel for the site, where it would aggregate all professionally created music videos. Sounds like the original MTV for the web. How ironic that of all the media giants, Viacom has battled with YouTube the most.
Questions? Comments? MediaMoney@cnbc.com
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51edbeb7b6bee4bee8250b0102de785f | https://www.cnbc.com/2009/09/30/3-stock-and-bond-plays-chief-investor.html | 3 Stock and Bond Plays: Chief Investor | 3 Stock and Bond Plays: Chief Investor
Jason Trennert, chief investment strategist and managing partner at Strategas Research Partners shared three actionable investment strategies for investors looking to boost their portfolios.
Trennert’s Recommendations:
“Short” US Treasurys—“There’s an ETF called TBT ," Trennert told CNBC.
VIDEO0:0000:00Three Actionable Investment Strategies
"The government is adopting a Bear Stearns/Lehman Brothers type of funding model. It has enormous long-term liabilities and yet we continue to fund it short…This is not sustainable in my view and just looking at 'Simple Simon' economics, it’s hard to increase anything by six times and not see the price go down.”
Coca-Cola —"It’s a global brand—generates an enormous amount of cash and pays a dividend, which is going to be very important in an environment where equity returns will be somewhat lower," he said. "I do think these are tremendous cash flows and enormous foreign exposure."
Schlumberger —"We feel very strongly about the energy and basic materials sectors," he said. "If China continues to keep its foot on the accelerator, then we think oil prices will stay sustainably high. And Schlumberger is going to do very well and relatively well if oil prices are high and steady."
More Investor Intelligence:
Equities Will Go Higher: Stock Picker2 Stocks Could Quickly Go From Trash To TreasureWhere to Invest Now: 2 Stock Pickers
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Disclosure:
No immediate information was available for Trennert or his firm.
______________________________CNBC Slideshows:
What Does $1 Trillion Look Like?
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Disclaimer
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7d4a81969361aecc88cb5c5a1a9b39a7 | https://www.cnbc.com/2009/09/30/8-stock-picks-small-vs-large-caps.html | 8 Stock Picks: Small vs. Large Caps | 8 Stock Picks: Small vs. Large Caps
Small cap stocks outperformed large caps this quarter, but what's the best bet going forward? Two portfolio managers, Michael Cuggino of Permanent Portfolio Funds, and Bill McVail of Turner Small Growth Fund, shared their market insights. (See their stock picks, below.)
VIDEO0:0000:00Small Caps vs. Large Caps
“Larger caps have more resources, diversification, ability to take advantage of worldwide economic growth, and the resumption of that,” Cuggino told CNBC.
“The liquidity issues out there favor large cap stocks—more access to resources to be able to facilitate that growth.”
Cuggino added that the weaker dollar should help corporate earnings of larger cap growth companies based on worldwide growth.
Where's the US Dollar Today?
In the meantime, McVail said small cap firms have a significant amount of margin expansion to come. He believes that a new wave in small caps should come as investors buy small cap stocks, instead of just indexes.
“At some point, people are going to have to unwind and buy stocks,” he said.
Cramer: Hold On to This 'Monster' Retail Stock2 Stocks Could Quickly Go From Trash To Treasure
“Small cap companies that have done a good job hanging in this market environment with limited topline growth are going to have some dramatic margin expansion and earnings acceleration, as you get a bit of topline growth in the back half of this year and the first part of 2010.”
Cuggino Likes:
Hewlett-Packard
State Street Bank
Freeport McMoRan
FedEx
McVail Likes:
J. Crew Group
True Religion
Texas Roadhouse
Green Mountain Coffee Roasters
______________________________ Disclosure:
McVail owns shares of JCG, TRLG and TXRH indirectly through his fund.
Cuggino owns shares of HPQ, STT, FCX, FDX indirectly through his fund.
______________________________CNBC Slideshows:
World’s Highest Corporate Tax Rates
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Disclaimer
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70283f1c4710615db206a3b1a307fe5e | https://www.cnbc.com/2009/09/30/an-interview-with-jon-kyl-on-the-public-option.html | An Interview with Jon Kyl on the Public Option | An Interview with Jon Kyl on the Public Option
Is the public option really dead?
Last night I interviewed John Kyl of Arizona, the Senate’s Republican whip, to get his take on the matter.
VIDEO0:0000:00Sen. Kyl Rejects Public Option
Kyl — who also serves on the Senate Finance Committee — voted to reject the public option.
He calls it “a solution looking for a problem,” and thinks it will ultimately come up short.
He also believes there will be some substitute for the public option that most Democrats will rally around once it fails.
Slideshow: How Your Tax Dollars Are Spent
Questions? Comments, send your emails to: lkudlow@kudlow.com
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b28d21f102c09563f5cdc89c46371ed7 | https://www.cnbc.com/2009/09/30/auf-wiedersehen-mike-youre-out.html | 'Auf Wiedersehen, Mike. You're Out' | 'Auf Wiedersehen, Mike. You're Out'
Rubberball | Getty Images
I'm bummed.
I almost made it.
For two days (yesterday and last Thursday) I was seated in the jury box for a murder trial in Newark, New Jersey. Most people want to get out of their civic duty. I get that. We all have work and life to tend to. But the only time I sat on a jury was around 20 years ago and it was for a DUI. We acquitted, but I immediately told the defendant he was lucky to get off because we thought he was guilty, but the prosecutor just didn't have enough.
Before coming to CNBC, I spent the first 17 years of my career in local TV news. Murders and murder trials were a staple. I still remember the first murder trial I covered and the name of the accused: Craig Steven Smith. I don't think I will ever forget it. It was in Great Falls, Montana. And it was big news in a small town. The guy was charged with killing his fiance with the broken glass from a 7Up bottle, stuffing her body in the trunk of a car and then dumping it in the Missouri River. Marc Racicot, who later went on to become the Governor of Montana and the Chairman of the Republican National Committee, was the special prosecutor. He won the case.
Slideshow: A Rogues Gallery of Financial Crime
My desire to get on the Newark jury had nothing to do with avoiding work. Gosh knows I've got plenty to keep me busy and interested here. Rather, I've always wanted to be on the other side. I wanted to experience the mundane, the minutiae and the high drama of a murder case from inside the jury box. I thought I had made it through the painstaking and, frankly, boring process of voir dire (that's legalese for jury selection.) The prosecutor told the judge he was satisfied with the jury. But one by one the defense lawyer kept picking off potential jurors. And finally my number came up. "Your honor, please thank juror number 13, Mr. Huckman." Damn.
The jury pool administrator immediately excused me and so I was free to Google. A search of the defendant's name turned up this U.S. Marshal's press release. He's the second fugitive named. This is a big case.
I had some clues from my experience covering murder trials. There were always two sheriff's deputies in the courtroom and they were never far from the accused. The defendant was wearing a button-down dress shirt that was a few sizes too big, so I assumed he was still in jail and dressed by his lawyer for court. A boilerplate question during voir dire was, "Do you watch 'America's Most Wanted' or 'Manhunters'?" Plus, the judge told us the crime occurred in December 2007. It usually doesn't take that long for a murder case to go to trial, so I assumed this guy must've been on the run or something for awhile.
Special Report: Scam of the Century, The Bernie Madoff Story
Anyway, it's all a moot point now. I think I would've made a good juror. And I can't help but wonder what the defense lawyer might have had a problem with. Was it something I said? Did I wince too much when another prospective juror said he'd been hit over the head with binoculars at a sporting event? Did I look too many times at the prosecutor and avoid lingering glances at the defendant? The judge tells you not to take being booted personally, but I can't help it. I'm anxious to hear the verdict likely sometime late next week.
Questions? Comments? Pharma@cnbc.com and follow me on Twitter at mhuckman
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5a52470a2d192cc33da4d3583f1633f0 | https://www.cnbc.com/2009/09/30/bofa-ceo-ken-lewis-to-step-down-by-the-end-of-this-year.html | BofA CEO Ken Lewis to Step Down By the End of This Year | BofA CEO Ken Lewis to Step Down By the End of This Year
Bank of America's CEO Ken Lewis, the embattled head of the nation's biggest bank, told the board he plans to step down by the end of the year.
AP
Lewis wasn't asked to step down and the decision was not the result of any regulatory action, sources told CNBC. No successor has been named yet.
Slideshow: World's Best Banks in 2009
The Charlotte, North Carolina-based Bank of America's board will continue evaluating potential successors, a company announcement said.
BofA stock moved higher in after-hours trading. Click here for after-hours quote.
Lewis, 62, ran Bank of America for nearly a decade, succeeding his mentor Hugh McColl in 2001.
After being named to the top spot, he proceeded to build one of the nation's largest financial services companies through aggressive acquisitions.
But in the last year, Lewis was the subject of rising political criticism, along with federal and state investigations into the bank's acquisition of Merrill Lynch in late 2008 and early 2009.
He had previously announced hopes of retiring after the bank repaid $45 billion in government assistance, or when he hit the company's mandatory retirement age of 65.
BofA's shareholders voted in April to oust Lewis as chairman after months of mounting criticism of his stewardship of the bank.
VIDEO0:0000:00Will Fleming Replace Lewis?
"It's a good thing for the company to make a clean break and move forward," Walter Todd, portfolio manager at Greenwood Capital Associates, told Reuters. "Ken Lewis has been overly targeted in terms of how things played out. But the fact is, perception is reality in these situations."
But not everything saw the resignation as a positive.
"For Bank of America this is bad," well-known banking analyst Dick Bove of Rochdale Securities told CNBC. "Lewis was a phenomenally good CEO, made a series of very strong positive decisions, including buying Merrill Lynch. I think it is a definite loss to Bank of America."
Bove said he thought the leading candidate to succeed Lewis would be Brian Moynihan, currently head of BofA's consumer and small-business banking.
Other possible successors include Thomas Montag, head of Global Markets; Barbara DeSoer, Bank of America Home Loans; Sallie Krawcheck, president of Global Wealth; Joe Price, CFO, and Greg Curl, chief risk officer.
Two board members are also possible contenders: Charles Gifford, 66, Bank of Boston's former CEO, and William Boardman, 67, retired Banc One executive.
—Reuters contributed to this story
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d5050d8a5be04140db23bb792647333b | https://www.cnbc.com/2009/09/30/charts-sp-at-critical-levels-as-oil-sinks.html | Charts: S&P at 'Critical Levels' as Oil Sinks | Charts: S&P at 'Critical Levels' as Oil Sinks
Oil prices are coming down from August highs, while the Standard & Poor's 500 index is approaching levels where it will find it hard to move higher, Chris Locke, managing director at Oystertrade.com Management, told CNBC Wednesday.
VIDEO3:0603:06S&P 500 â??Coming Up to Critical Levelsâ??
“We’ve broken the main uptrend from the March lows,” Locke told CNBC Wednesday, adding that as oil prices reach the $65 a barrel level, “we’ll start to see it work back toward the reaction lows we saw in July of $56 and maybe going lower.”
There has been a good correlation between crude oil and the S&P 500 since March, Locke said. The S&P is “coming up to critical levels” and Locke said he expects “it to have much difficulty moving higher."
To hear more about Locke’s predictions for oil, the S&P 500, and currency movement, watch the full interview above.
For Investors:
Oil Price Should Halve if Based Only on FundamentalsSpecial Report: Investing in Emerging Markets
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7b2a8dc85739c96c7f57a2b1a5a40046 | https://www.cnbc.com/2009/09/30/cramer-sell-the-hmos.html | If the recent performance of HMO stocks is any indication, Cramer said during Wednesday’s Stop Trading!, then some form of a public-option insurance plan will be available to consumers.
VIDEO0:0000:00Stop Trading, Listen to Cramer!
Unitedhealth Group , WellPoint and Humana have seen significant declines over the past couple of weeks, which Cramer attributed to a compromise being struck on this contentious piece of President Obama’s intended health-care reforms.
The public option was voted down in the Senate Finance Committee on Tuesday, but he said he expected a lesser version to pass. That could be bad news for the HMOs.
“This group must be sold,” Cramer said, reiterating his Tuesday call.
Elsewhere in the market, Exelon is “the real winner” when it comes to the Senate’s cap-and-trade bill, Cramer said. The company’s nuclear-power exposure offers the biggest advantage under the proposed legislation.
“The stock’s way off,” Cramer said, giving investors a great entry point.
Call Cramer: 1-800-743-CNBC
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
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08afba540e01cbfa592c613f433572ee | https://www.cnbc.com/2009/09/30/criticism-is-mounting-over-flood-premiums.html | Criticism Is Mounting Over Flood Premiums | Criticism Is Mounting Over Flood Premiums
Congress is preparing to extend the National Flood Insurance Program for another year, despite warnings that the program lacks adequate controls and may be shifting too much money to the insurance industry.
House surrounded by floodwaterAP
The insurance program, deeply in debt since Hurricane Katrina, operates as a public-private partnership, collecting more than $2 billion in annual premiums. The Federal Emergency Management Agency runs the program, and the government bears all the risk.
But the insurance policies are sold by individual companies under their own names, and those companies handle claims, pocketing a portion of the premiums and forwarding the rest to the government.
A recent report by the Government Accountability Office cited many inefficiencies in the program and found that the government overseers had no way of knowing how much profit their insurance partners were making and whether it was appropriate.
The program’s critics in Congress acknowledge that it serves an important purpose — indeed, some want it to cover even more types of damage — but say it has run off the rails and needs more oversight, if not a broader re-examination of the role of insurance companies.
The troubles with the flood insurance program offer a parallel to Congress’s grappling with how to expand access to health care, possibly through a government partnership with insurance companies.
“There are certain things to be learned,” said Robert Hartwig, president of the Insurance Information Institute. “If the price charged for the service rendered does not cover the cost, you will ultimately run a taxpayer-financed deficit.”
Clark Stevens, a spokesman for FEMA, said that by working through the insurance industry, the program was able to reach many more communities in a timely and cost-effective manner. The nation’s biggest insurers participate, including Allstate, State Farm , Traveler’s Insurance Companies, Liberty Mutual, Farmers and the American International Group . Many smaller and regional insurance companies also take part.
In all, the program takes in about $2.3 billion in premiums a year, and lets the insurance companies retain roughly $1 billion of that amount.
The Congressional auditors found that FEMA did not look at the insurers’ actual expenses when deciding what share of the premiums they could keep — even though the data has been available since 1997 from the National Association of Insurance Commissioners. Instead, the auditors found, the federal agency looked at the average expenses of companies selling five other types of property insurance.
When the auditors looked at the actual costs of selling flood insurance, they found that a sample of insurers in the flood program were retaining about $327 million more than they were incurring in actual expenses, a difference of about 16.5 percent.
The accountability office did not draw conclusions as to whether this profit level was too high, given that the insurers do not bear risk in the flood program. It simply stated that the government agency should be keeping better track.
Without accurate expense data, it said, the government “does not have the information it needs to determine whether its payments are appropriate and how much profit is included.”
Mr. Stevens said that the Congressional report was based on a small sample during a time when losses were unusually heavy.
“We have concerns about the report’s central finding because it is not representative of the program as a whole,” he said.
The accountability office also said that the roughly 90 insurance companies in the flood insurance program did not seem to market the flood insurance at all — they simply offered it when someone asked for it.
This seemed at odds with the government’s goal of trying to persuade more people to buy flood coverage, particularly people outside the most hazardous zones. Broadening and diversifying the risk pool of customers could lower the government’s costs and protect taxpayers.
Again, the accountability office faulted FEMA, saying it did not give the insurance companies any incentive to market their policies strategically. Instead of paying bonuses to insurers that brought in a more diverse group of policyholders, the federal agency has been using a broad-based formula that simply pays bonuses to companies that increase sales by 2 to 5 percent a year.
“This formula primarily rewards companies that are new” to the program, the auditors wrote.
The accountability office said that flood program representatives had expressed agreement with this finding and were already working on changes in the way the insurance companies are paid, which they hoped to have in place by next year.
The audit report was requested by Senator Richard Shelby of Alabama, the senior Republican on the Banking Committee, which also has responsibility for insurance. An aide to the senator said he would probably support a continuation of the flood insurance program, although he was concerned that it was not actuarially sound. The program is expected to receive month-to-month extensions, starting on Wednesday, when the government’s fiscal year ends, until a broader reauthorization is approved.
Before the flood insurance program was begun in 1968, most people with property in flood zones simply went without insurance. When there was a flood, people ended up relying on federal disaster relief, which was costly and poorly tailored to their needs.
The flood insurance program was based on the idea that if the government was paying for rebuilding anyway, it would be cheaper and more efficient to do so through insurance.
To keep the risks manageable and protect taxpayers, the program was set up to offer coverage only to property owners in communities that had floodplain management laws and enforced them, according to Douglas J. Elliott, a fellow at the Brookings Institution who has written a brief history of the flood program.
And the insurance was optional.
But over time, too few people were buying flood insurance — and too few communities were enforcing their floodplain rules. In 1972 Congress made the insurance mandatory for anyone who took out a mortgage from a federally regulated lender to buy property in a flood zone. In 1994, Congress added penalties for lenders that did not comply.
Mr. Hartwig of the Insurance Information Institute said the efforts to make flood insurance compulsory were reminiscent of the debate today over whether Washington should force everyone to buy health insurance.
“Forty years of experience found that the more people who opt into the program, the better the community is served,” he said. But people resisted.
“One reason people cite is that they believe they’ll be bailed out anyway, or they say they can’t afford it, no matter how much it is subsidized. And a third reason cited is, ‘Well, it won’t happen to me,’ ” he said. “All of these are analogous to the arguments in health care.”
To entice more people into the program, Congress limited the amount premiums could rise in a single year. But when real estate prices soared, so did the program’s risks. Premium revenue did not keep up, setting the program up for the financial calamity that accompanied Hurricane Katrina.
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After that, the program had to borrow from the United States Treasury to stay afloat. Now it is $20 billion in debt. Last year more than half of its outlays were for interest.
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b823c2022cc265b5336733fa33016ca6 | https://www.cnbc.com/2009/09/30/Fast-Moneys-Slo-o-o-w-Money-Trades.html | We know it seems like the Fast Money moves at the speed of light. So we thought you’d appreciate it if we slowed things down a bit.Following you’ll find Fast Money’s Slow Money trades – stocks the traders would buy and hold for the next five years!Photo: Oliver Quillia
We know it seems like Fast Money moves at the speed of light. So we thought you’d appreciate it if we slowed things down a bit.Following you’ll find Fast Money’s Slow Money trades – favorite stocks the traders would buy and hold for the next five years!Posted 1 Oct 2009
Stock: Johnson & Johnson (JNJ): This stock shows very stable earnings growth helped in large part by JNJ’s decision to buy Pfizer’s consumer brands business a few years ago. As a result, not only do they have a nice pipeline of new drugs, the company has a diversified business model, Pharmaceutical, Medical Devices & Diagnostics, and Consumer Products. With fair valuations and a stable dividend, JNJ makes a great stock for the long term.Photo: D'Arcy Norman
Stock: Johnson & Johnson (JNJ): This stock shows very stable earnings growth helped in large part by JNJ’s decision to buy Pfizer’s consumer brands business a few years ago. As a result, not only do they have a nice pipeline of new drugs, the company has a diversified business model, Pharmaceutical, Medical Devices & Diagnostics, and Consumer Products. With fair valuations and a stable dividend, JNJ makes a great stock for the long term.
Stock: Joy Global (JOYG)In the near-term the company should benefit from the stimulus package, which really hasn’t started to kick in, yet. Then, when iron ore, copper and coal demand really picks up due to global recovery, they should benefit more.
Stock: Joy Global (JOYG)In the near-term the company should benefit from the stimulus package, which has only just started to kick in. Then, when global recovery really gets a foothold, demand for iron ore, copper and coal should surge, which benefits this company even more.
Stock: Groupo Aeroportuario del Pacifico (PAC)They own four of the top ten busiest airports in Mexico and every time a passenger departs they collect a fee. Also, they have a superb balance sheet and I expect to see growth in Mexico in the years ahead. All these factors should be bullish for this stock.
Stock: Groupo Aeroportuario del Pacifico (PAC)This company owns four of the top ten busiest airports in Mexico and every time a passenger departs they collect a fee. Also, they have a superb balance sheet and I expect to see growth in Mexico in the years ahead. All these factors should be bullish for this stock.
Stock: FordNot only is government is behind the company, at least implicitly, they have emerged as a leaner and meaner company as a result of the downturn, he says. Also sales are up in Latin American and Asia which says to me that they’re a player all over the globe.
Stock: Ford (F)Not only is the government behind the company, at least implicitly, they have emerged as a leaner and meaner auto maker as a result of the downturn. Also sales are up in Latin American and Asia which says to me that they’re in it to win it, all over the globe.
Stock: Exxon (XOM)When John D. Rockefeller began this company he set an unbeatable strategy in motion that's still practiced today. And that strategy is year on year to provide returns that beat the competition. On top of that, the globe needs energy and Exxon will provide it. And they're also into bio-fuels which I like.
Stock: Exxon (XOM)When John D. Rockefeller began this company he set an unbeatable strategy in motion that's still practiced today. And that strategy is year on year to provide returns that beat the competition. On top of that, the globe needs energy and Exxon will provide it. And they're also into bio-fuels which I like.
Stock: Visa (V)Once the housing and the employment situation improves, Visa should take off as well. As we all know, economic downturns tend to be cyclical and we should come out of this one as well. Even though consumers have pulled back on spending, once their house values return to being worth more than what they owe on it -- and their job security is more intact -- they will get back to using credit cards with valuable points programs instead of cash.
Stock: Visa (V)Once the housing and the employment situation improves, Visa should take off as well. As we all know, economic downturns tend to be cyclical and we should come out of this one as well. Even though consumers have pulled back on spending, once their house values return to being worth more than what they owe on it -- and their job security is more intact -- they will get back to using credit cards with valuable points programs instead of cash.
Stock: Home Depot (HD)While the correction in the housing market is currently putting pressure on sales, the company is taking advantage of this time of lower expectations to get their own house in order. New systems, better inventory and staffing practices plus sales incentives for associates are creating a culture that will not only thrive but continue to take market share from smaller competitors over the long run. As the consumer recovers, Home Depot should be a long-term winner.Photo: John Carlson
Stock: Home Depot (HD)While the correction in the housing market is currently putting pressure on sales, the company is taking advantage of this time of lower expectations to get their own house in order. New systems, better inventory and staffing practices plus sales incentives for associates are creating a culture that will not only thrive but continue to take market share from smaller competitors over the long run. As the consumer recovers, Home Depot should be a long-term winner.
Stocks: BHP and ValeEmerging market miners BHP and Vale are Slow Money ‘Buys.’ As the emerging world continued to industrialize and modernize, they will provide the key elements needed for that growth. Vale is a pure iron ore play, and nickel. BHP is the largest consolidated global miner.
Stocks: BHP and ValeEmerging market miners BHP and Vale are Slow Money ‘Buys.’ As the emerging world continues to industrialize and modernize, they will provide the key elements needed for that growth. Vale is a pure iron ore play, and as well as a nickel play. BHP is the largest consolidated global miner.
Stock: IBMWith a 3 – 5 year holding period, not many companies make more sense than big blue. While the stock has increased dramatically from the March lows (and what stock hasn’t) valuations are still reasonable. The business is solid with great diversification by business line, geography and technology platform. Management has done an excellent job cutting costs during the recession and has prepared the business for long term success by taking advantage of the weakness of their competition.Int
Stock: IBMWith a 3 – 5 year holding period, not many companies make more sense than big blue. While the stock has increased dramatically from the March lows (and what stock hasn’t) valuations are still reasonable. The business is solid with great diversification by business line, geography and technology platform. Management has done an excellent job cutting costs during the recession and has prepared the business for long term success by taking advantage of the weakness of their competition.International Business should drive top line growth faster than many of their U.S. peers and lead to margin expansion and growth in cash flow that should allow their multiple to at least stay the same, if not expand. The stock will pullback with any decline in the equity markets and that decline would be an excellent opportunity to enter the stock for long term investors.
Stock: Veolia (VE)This France-based company is the largest water utility in the world. Considering France consumes more water per capita than any other country (except the US) Veolia has a great base of stable operations. Also they’re expanding well into Asia, especially India. With the global thirst for clean water likely to intensify in coming years, Veolia should be at the forefront of developments and advances.
Stock: Veolia (VE)This France-based company is the largest water utility in the world. Considering France consumes more water per capita than any other country (except the US) Veolia has a great base of stable operations. Also they’re expanding well into Asia, especially India. With the global thirst for clean water likely to intensify in coming years, Veolia should be at the forefront of developments and advances.
Stock: Teva Pharmaceuticals (TEVA)Teva is the world's largest generic drug maker with 50% more Rx’s than their # 2 competitor. No matter what structure heath care reform takes, cheaper, quality generic drugs will be a part of it and Teva stands to benefit. 62% of Teva’s business comes from U.S. healthcare spending which is growing faster than GDP. And Teva will also be expanding its penetration into Japan and Europe.
Stock: Teva Pharmaceuticals (TEVA)Teva is the world's largest generic drug maker with 50% more Rx’s than their # 2 competitor. No matter what structure heath care reform takes, cheaper, quality generic drugs will be a part of it and Teva stands to benefit. 62% of Teva’s business comes from U.S. healthcare spending which is growing faster than GDP. And Teva will also be expanding its penetration into Japan and Europe.
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0f3e54cdde73368a2de56fd9f32dd54c | https://www.cnbc.com/2009/09/30/financial-overhaul-bill-could-be-done-by-january-dodd.html | Financial Overhaul Bill Could Be Done By January: Dodd | Financial Overhaul Bill Could Be Done By January: Dodd
Sen. Chris Dodd (D-Conn.) told CNBC Wednesday that he hopes to get a bill on financial regulation reform to the Senate floor by January of next year.
"Timing is critical and we don't want to rush into anything," Dodd said. "But we want to spend the month of October to try and write a bill and then have something by December or January of 2010."
VIDEO0:0000:00Dodd on Wall St.'s New Rules
Dodd, chairman of the Senate Banking Committee, also said that the consumer protection idea would apply to a wide range of people. "We're striking a balance between getting it right and keeping a sense of urgency," said Dodd.
(See video for full interview with Dodd)
Dodd said he wanted to make it possible to unwind the bigger financial firms by having sufficient capital requirements in place. "We want to have 'too big to fail' to rest permanently," said Dodd.
When asked about a public option for health care reform, Dodd said that he still believed one was possible. "It's not dead yet even with the recent votes," said Dodd. He went on to say that there's still a lot of public support for a public option.
On Tuesday, the Senate Finance Committee voted down two amendments in support of a government sponsored option as part of a health care reform bill.
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ac4915c344f0a6fd2d6e82395c16b985 | https://www.cnbc.com/2009/09/30/flu-fears-mean-247-production-for-mask-makers.html | Flu Fears Mean 24/7 Production for Mask Makers | Flu Fears Mean 24/7 Production for Mask Makers
Workers are fighting the flu around the clock at the Alpha Pro Tech factory in Salt Lake City, Utah.
Since last spring's outbreak of the H1N1 Influenza Virus, also known as swine flu, orders for the company's N95 respirator masks have soared, and demand is growing with the onset of the fall flu season.
"We expect sales to continue to be much stronger than normal for the foreseeable future," Al Millar, president of Alpha Pro Tech , said.
Back orders are expected be made up quickly, with production expanded threefold, Millar said. With every machine operating 24 hours a day, seven days week, the company is now producing 240 per minute, about 1,000 cases per day.
It's a big undertaking for a small company, but its second-quarter revenues were up 63 percent to a record $14.5 million from the first wave of the pandemic, led by a 184 percent increase in its mask sales.
Millar said he sees their work as an important line of defense in the reaction to the pandemic. As flu season progresses, his biggest challenge may be maintaining staffing levels if his workers or members of their families fall ill.
Alpha Pro Tech last ramped up production like this with the SARS outbreak of 2006. Back then, the contingency plan for an outbreak in Utah was to house workers who were willing in the production facility so they could keep working, he said.
3M Ramps Up Capacity
Alpha Pro Tech's much larger rival, 3M, has added more than 40 percent more respirator production capacity since the 2006 SARS outbreak at its facilities around the world in the U.S., Korea, Britain, Russia and China.
The manufacturing giant announced in July it is spending an additional $20 million in capital expansion now to boost capacity by another 10 percent in order to meet demand. Its orders are backlogged well into the end of the year.
VIDEO0:0000:00Is the Country Ready for Flu Season?
Production of masks at its global facilities has also been ramped up around the clock, company spokeswoman Jacqueline Berry said.
Kimberly Clark is another major manufacturer of mask for health professionals and also reported a surge in demand during its second quarter related to H1N1. The company is expecting demand to be high during flu season, but declined to discuss its production, because it is now in the quiet period ahead of its third quarter earnings release scheduled for October 24th.
Massive N95 Mask Need
The N95 mask is in greatest demand because it's what world health officials recommend for health professionals when caring for flu patients.
In early September, the Institute of Medicine reported that N95 masks, which are heavier than traditional medical masks and fitted around the nose and mouth, do a better job of guarding against respiratory infection. According to the report, properly fitted and worn correctly, N95 respirators filter out 95 percent of particles as small as 0.3 micrometers, which is smaller than influenza viruses.
But hospitals and health-care facilities will need both types of masks. In the U.S., the Department of Health and Human Services (HHS) estimates the need for more than 30 billion masks in the event of a serious epidemic (27 billion surgical masks, 5 billion respirator masks).
According to the Centers for Disease Control, as of August 28th, 2009 the national stockpile of contains only 119 million masks (39 million surgical, 80 million respirators).
Millar said he expects, for now, the round-the-clock production will help meet his customers respirator needs, but a widespread pandemic this winter will certainly put him and his larger manufacturing rivals to the test.
Slideshow: The Worst Expected State Budget Gaps
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268624252026cf70fdb25d0683591fca | https://www.cnbc.com/2009/09/30/gm-to-shut-down-saturn-after-penske-walks-away.html | GM to Shut Down Saturn After Penske Walks Away | GM to Shut Down Saturn After Penske Walks Away
Saturn AuraSource: saturn.com
General Motors will close Saturn and wind down its dealership network after a deal to sell the faltering brand to Penske Automotive Group collapsed, the automaker said Wednesday.
The breakdown of a deal that had been widely expected to close this week will force some 350 Saturn dealerships to close and could cut thousands of auto retail jobs that would have been preserved under a plan by auto magnate Roger Penske.
Shares of Penske Automotive were down almost 10 percent Wednesday in aftermarket trade. The breakdown of the deal was announced after the New York Stock Exchange closed.
GM's failure to complete the deal also adds uncertainty to the automaker's production plans as it struggles to regain its footing following a $50-billion taxpayer funded restructuring.
"This is very disappointing news and comes after months of hard work by hundreds of dedicated employees and Saturn retailers who tried to make the new Saturn a reality," GM Chief Executive Fritz Henderson said in a statement.
VIDEO0:0000:00Penske Auto Terminates GM Talks
Penske, 72, had been negotiating to buy the brand under a deal that would have seen GM supply vehicles under contract until the end of 2011, leaving him free to tie up with other manufacturers afterward.
In a statement, Penske said it had negotiated an agreement to source vehicles from another manufacturer after its supply agreement had ended. But it said that deal was rejected by the other automaker's board of directors.
"Without that agreement, the company has determined that the risks and uncertainties related to the availability of future products prohibit the company from moving forward with this transaction," Penske said in the statement.
Penske did not identify the other automaker.
However, people familiar with the discussions said Penske had been in advanced talks with Renault on Saturn. A Renault spokeswoman could not be reached immediately for comment.
GM said it would detail the closure plans for Saturn shortly. Saturn's remaining dealers have already signed wind-down agreements with GM, the automaker said.
GM created the brand in 1983 in a bid to compete with Japanese automakers on quality and service and to provide car buyers with "no-haggle" pricing.
Saturn sales had peaked in 1994 and GM had attempted a turnaround of the brand earlier this decade under then product chief Bob Lutz.
Struggling to regain its financial footing, GM announced in February that it would either spin Saturn off or close the brand. Penske and GM announced a preliminary agreement on Saturn in June after the U.S. automaker filed for bankruptcy.
GM and Saturn had said they expected to complete the deal by the fourth quarter.
Saturn sales have dropped 59 percent through August from a year earlier amid the uncertainty about the brand's future. Its best-selling models are the Vue small SUV and the Aura sedan.
Penske shares were trading at around $17 Wednesday afternoon, down from $19.18 at the close.
Click Here for After-Hours Penske QuotesSlideshow: Are You Driving One of America's Most Ticketed Cars?
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ece3491ab79c71cccd8c0eeb90376f4f | https://www.cnbc.com/2009/09/30/in-need-of-some-direction.html | In Need of Some Direction | In Need of Some Direction
Futures all over the map this morning: They popped to their highs of the morning, and have since come down, as the final numbers for second quarter GDP came in better than expected (decline of 0.7 percent vs. expectations of a decline of 1.2 percent).
Futures had rallied modestly overnight as the dollar again resumed its downward trend, then dropped when the ADP report indicated that 254,000 jobs were lost in September, more than the 200,000 loss expected. Still, it was the smallest decline since July 2008.
Elsewhere:
1) Darden , owner of Red Lobster, Olive Garden and Capital Grille restaurants, down about 5 percent pre-open. Though they beat earnings estimates by a penny, revenues were weak. They are maintaining guidance of $2.59-$2.85 vs. consensus of $2.80, while same store sales guidance is a bit lower than expected.
2) IPO postponed: We have noted the poor reception which real estate investment trust (REIT) IPOs have received in the last week. Last night Ladder Capital Realty Finance (LCG) indefinitely postponed its IPO. It was looking to price 20 million shares at $20.
3) Nike rises 6 percent after Q1 earnings topped estimates ($1.04 vs. $0.97 est.) as cost cuts and better inventory controls continued to help.
Despite the earnings beat, sales were weak around the world, even when excluding negative currency impact: North America down 5 percent, Western Europe down 8 percent, Central and Eastern Europe down 23 percent, China down 17 percent, Japan down 10 percent. The apparel and footwear maker also sees worldwide futures orders for the current quarter to fall 6 percent from last year's levels.
Goldman Sachs also upgrades the stock to 'buy" on a optimism over improved basketball shoe sales and expectations of positive effects from the upcoming World Cup soccer tournament.
4) Micron is down 2 percent despite posting a smaller-than-expected Q4 loss (loss of $0.10 vs. loss of $0.18 est.). CEO Steve Appleton noted that "the market, while still challenging, is beginning to improve."
One encouraging sign for the chipmaker: sales of DRAM were up 28 percent amid stronger volumes and higher prices. Meanwhile, sales of flash memory also rose 10 percent, but that was due to a 23 percent rise in volumes which offset an 11 percent fall in prices.
5) Cash for clunkers redux: the expiration of the first time home buyer tax credit in November may be having the same effect on home sales that the cash for clunkers program had on car sales after it expired. The Mortgage Bankers Association (MBA) said applications for mortgages to buy homes fell 6.2 percent last week to a 7 week low, despite the fact that the average 30-year mortgage rate fell to a 4 month low.
6) With one day left in the quarter the S&P 500 is up 15.3 percent, exactly mimicking the 15.2 percent gain in the second quarter, the first back to back gains since 2007. Still, it was the best quarter in almost 11 years. Once again financials lead the gains (25 percent) followed closely by industrials (22 percent) and materials (22 percent).
7) Workers, produce more! No, wait! Stop producing! China announced plans to curb overcapacity. The State Council is simply dictating that certain industries (steel, cement, plate glass, etc.) must cut production. No new aluminum smelters, no new steel plants. _____________________________
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20247d0b547057ada8d24d290fd37892 | https://www.cnbc.com/2009/09/30/jobless-rates-drop-in-most-us-metro-areas-in-august.html | Jobless Rates Drop in Most US Metro Areas in August | Jobless Rates Drop in Most US Metro Areas in August
The August unemployment rate fell in about 60 percent of metropolitan areas from the previous month, as layoffs eased nationwide.
CNBC.com
The jobless rate dropped in 232 of 380 metro areas, according to an Associated Press analysis of Labor Department data released Wednesday.
That's an improvement from July, when metro areas were split between those with rising and falling joblessness. It's also much better than in June, when the unemployment rate rose in about 90 percent of metro areas.
But in many cases the declines are due to large numbers of people dropping out of the labor force. Economists say that usually indicates unemployed workers are becoming discouraged and giving up on their job searches.
Job losses are moderating, but "not enough to keep the unemployment rate from rising," said Sophia Koropeckyj, an economist at Moody's Economist.com. "We're not seeing any hiring taking place."
The metro employment figures aren't adjusted for seasonal changes, such as layoffs in the agriculture industry after summer harvests, so they tend to be volatile from month to month. And many of the changes in local unemployment rates were too small to signal larger trends.
Most analysts expect the nation's economy, bolstered by government stimulus efforts, grew at a healthy clip in the July-September quarter, putting an end to the recession.
But many also agree with Federal Reserve Chairman Ben Bernanke, who said in September that growth isn't expected to be strong enough to reduce the jobless rate for some time.
The increase in discouraged workers is most apparent in large cities that reported the biggest drops in unemployment. The jobless rate in Toledo, Ohio, fell to 12.1 percent from 14 percent in July, while its work force dropped about 8,000, or 2.4 percent, to 328,000.
VIDEO0:0000:00The Job Market: State by State
Unemployment in the Chicago area, meanwhile, dropped to 9.7 percent from 10.6 percent -- while its work force also fell about 2 percent. Similar trends took place in Denver and Miami.
Once unemployed people stop looking for work -- some, for example, may return to school -- they are no longer counted as part of the labor force and aren't included in the jobless rate.
The declines generally "can be interpreted as discouragement over poor job prospects," Koropeckyj said.
The metropolitan unemployment data precedes Friday's report on nationwide unemployment in September. Wall Street economists expect that report will show joblessness rose to 9.8 percent from 9.7 percent in August. Employers are forecast to have cut 180,000 jobs, down from 216,000 the previous month.
Overall unemployment remains high. The jobless rates rose in all 380 metro areas from August 2008, according to the metro report.
The largest increase in the past year was in the Detroit metro area, which has been hammered by the downturn in the auto industry. Unemployment rose 7.9 percentage points to 17 percent, followed by the Muskegon, Mich., metro area, where joblessness increased 7 percentage points to 16.1 percent. Michigan's unemployment rate of 15.2 percent is the highest in the nation.
There were 129 areas with August jobless rates of at least 10 percent, the department said, down from 139 in July. Sixteen areas had unemployment rates of 15 percent or above; seven of those were in California and four in Michigan.
El Centro, Calif., had the highest jobless rate at 28.7 percent, followed by Yuma, Ariz., at 26.1 percent. The two areas are next to each other and have long suffered high unemployment due to many seasonal farm workers.
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492d9330e489313095d4aa1d291bff1e | https://www.cnbc.com/2009/09/30/lightning-round-ford-kroger-hess-and-more.html | Bank of Ireland : Cramer recommended both IRE and Allied Irish Banks.
VIDEO0:0000:00Lightning Round
Omnova Solutions : Cramer said he needed to do more research on OMN before making a call.
Ford Motor : Go with Ford’s preferred shares rather than the common stock, Cramer said.
Veeco Instruments : Cramer is bullish on this mobile Internet play.
Kroger : Cramer would rather see investors in Whole Foods .
Hess :Marathon Oil and Chevron are better picks, Cramer said.
Call Cramer: 1-800-743-CNBC
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
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931c6f0879b87f376aaecc93f93ed236 | https://www.cnbc.com/2009/09/30/lightning-round-ot-allos-therapeutics-parker-drilling-and-more.html | VIDEO0:0000:00Lightning Round OT
Allos Therapeutics : Cramer likes Allos as a speculative trade.
Cognizant Tech Solutions : Cramer is bullish on this IT company.
Parker Drilling : Go with Schlumberger or Transocean instead, Cramer said.
Call Cramer: 1-800-743-CNBC
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
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2127142ae27831cb211cfb86c953afc0 | https://www.cnbc.com/2009/09/30/more-ma-is-possible-sps-sam-stovall.html | More M&A is Possible: S&P's Sam Stovall | More M&A is Possible: S&P's Sam Stovall
Sam Stovall, chief investment strategist at Standard & Poor’s, shared his market insights.
VIDEO0:0000:00Markets Breakdown
“The consumer is still nervous—we’re 10 points below the bottom in consumer confidence that we saw in the last bear market,” Stovall told CNBC.
“So even though we’ve doubled from March of this year, consumers are still nervous. But they’re also very much a lagging indicator, pointing to bottoms usually three months after the fact.”
Among other economic data from today, Stovall said the positive S&P Case-Shiller numbers imply that the housing market may be coming up from the “deep depths.”
More Market Intelligence:
Art Cashin: Fooled by 'La Cage Aux Folles' Market'Fast Money' Traders: Will Stocks Stay Sideways?
Additionally, Stovall said there may be more merger and acquisition activity in the near term.
“The money on the sidelines might end up going to continue to fuel M&A activity if these companies believe the economy is going to be recovering into 2010," he said. "They want to leverage these low inventory levels...to get a better position.”
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a4fb5727432d10c22f80ea10285c728b | https://www.cnbc.com/2009/09/30/new-russia-mba-program-tackles-bribery-red-tape.html | New Russia MBA Program Tackles Bribery, Red Tape | New Russia MBA Program Tackles Bribery, Red Tape
A handful of top Russian business figures have created an MBA program that tackles the issues they faced themselves: bribery, relentless bureaucracy, imperfect laws.
Supporters of the Moscow School of Management Skolkovo say it will fill an important niche by getting students ready for the unpredictable, sometimes corrupt world of emerging market economies.
"We'd like to change the whole model," says Dean Wilfried Vanhonacker. "It doesn't make sense for us, nor are we interested in competing with Harvard. That's a business school of the past, I have to say. But a business school of the future has to be different."
With construction not quite finished on its glass and steel, $250 million campus just outside Moscow's city limits, the school this month launched its full-time, 16-month masters in business administration program, with classes temporarily in the five-star Baltschug Kempinski hotel near the Kremlin.
Vanhonhacker, the former director of the Ph.D. program at France's prestigious INSEAD business school, said that developing economies hold out the biggest opportunities. But business schools don't prepare students to work in them.
AP
"We looked and we didn't see any business school preparing this talent, even though in most corporate sectors this is where we expect the growth to come from," Vanhonacker said.
Skolkovo includes classroom courses in management theory, but invites dozens of guest speakers to provide the students with real-life examples of the challenges of emerging economies.
And part of their training consists of working in real companies solving real-world problems. After three months of studying management theory, students are placed with a government department or company in Russia, China, India or the United States.
"It's learning by doing, not learning by acting or playing," said Serge Hayward, MBA program director.
Hayward said that he is considering asking officials in police agencies and private security firms to speak to the business students, and might even invite an organized crime boss to talk about the challenges of management.
Slideshow: The World's Most Expensive Cities
"We're trying to put them in an environment where they are going to function rather than tell them about this environment," he says.
One of the aims of throwing students into the world of business and government, Vanhonacker said, is to break down their preconceptions. "We want to shock them that there is a reality out there which is very different from what they think it is," he said.
Last week, 40 students in their 20s and 30s, most in casual dress such as sport shirts and jeans, listened intently to Professor Pierre Casse lecture on leadership. Casse used a hypothetical murder case to illustrate how judgment depends on one's own point of reference, and how leadership is about rallying people around one reference point.
Student Julia Davis, an American, says she chose the Moscow school because it is a "forward-looking" institution which has no preconceived notion of either business education or the nature of the global economy.
Davis says she was glad to find Skolkovo instructors talking about topics rarely discussed in conventional MBA classrooms — such as corruption, flawed legislation, powerful bureaucracies and the role of ruling parties in running emerging economies.
Among the patrons are some of the Russian business world's biggest names: Ruben Vardanian, founder of Troika Dialog investment bank and entrepreneur Roman Abramovich as well as global companies such as Credit Suisse and industrial giants such as Russia's Sevestal steel.
In Pictures: The World's Highest Corporate Taxes
President Dmitry Medvedev, who has spoken of the need to combat corruption, sits on the advisory board and spoke at the program's inaugural ceremony.
Vardanian says only private money is involved, but approval from higher authorities has spared the project bureaucratic hurdles that it might have otherwise faced.
Abramovich, the billionaire investor and owner of the Chelsea football team, donated 26 hectares (64 acres) of choice land outside Moscow for the construction of the gleaming $250 million campus, which has its own helipad.
Several of the Russian students will work as consultants to the government, and are braced for a major challenge.
"I want to understand how one can manage to work in the Russian government, how one can bring in new things and get adapted without sinking to the lows of bureaucracy," said student Alexandra Dronova.
Skolkovo faculty members say they avoid moral judgments, and offer no ready-made strategies for handling corruption and predatory practices.
"It's up for everyone to make their own choice because they need to realize that they will be competing against a company that will be giving bribes and they won't," Vardanian said. "Their company will need to be more efficient than the one that will be giving bribes, or they'll lose."
Other business schools do offer some focus on emerging markets. France's INSEAD, for example, offers field work in China, India and Middle East.
Loic Sadoulet, academic director of the INSEAD Africa Initiative, said one optional course focuses on developing countries and deals with such issues as foreign direct investment, corruption, and health.
Although there are MBA programs running at a handful of universities in Russia, few of them attract globally renowned teachers and are most are taught in Russian. Classes in Skolkovo are conducted in English, the business world's lingua franca.
Skolkovo's training doesn't come cheap. Fees for a full-time MBA including accommodation, flights to India, China and the U.S. come to 50,000 euros ($74,000), comparable to prices at leading business schools globally.
The sum will sound daunting for many in Russia, where a monthly salary averages 18,000 rubles ($590) across the country and 33,000 rubles ($1,100) in Moscow. Loans are available.
Dronova said she chose Skolkovo because she wanted an education relevant to life in Russia. "I specifically wanted to get an MBA in Russia," she said. "There's not much point to be educated somewhere in the States. There are excellent schools there, but how do you apply this in Russia?"
This Day - One Year Ago
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79c051a49c03981b402bc056028a039b | https://www.cnbc.com/2009/09/30/october-looks-great-for-stocks-analyst.html | October Looks Great for Stocks: Analyst | October Looks Great for Stocks: Analyst
Forget 1929, 1987 or even 2008: October is a good month for stocks. So said Jordan Kotick of Barclays Capital, who offered CNBC his market insights going into the fourth quarter.
Stocks logged their best quarter in 11 years, as of Wednesday's close of U.S. trading. Kotick said the best is yet to come.
VIDEO0:0000:00October Stays Strong?
He pointed to several different indicators and trends collated "since 1950" — including more recent developments in the Russian and Saudi Arabian stock markets — which he said prove that the fear of October is unfounded.
"The odds of an advance are 50 to 60 percent," Kotick said. "And the median return is positive."
Positive Surprises Coming this Fall: Chief Investor2 Stocks Could Quickly Go From Trash To Treasure
"If we don't get a correction over the next couple of weeks, then the risk isn't until the end of the year — and you'll get a 'melt-up' in equities," Kotick declared.
For his take on the US Dollar, Yen and oil-stock market relationships, watch the full interview.
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07598eb67db74e7a063231f189ce324c | https://www.cnbc.com/2009/09/30/positive-surprises-coming-this-fall-chief-investor.html | Positive Surprises Coming this Fall: Chief Investor | Positive Surprises Coming this Fall: Chief Investor
Today marks the final day of the third quarter and stocks were tepid after manufacturing and jobs data. John Merrill, founder and CIO of Tanglewood Wealth Management and Bill Spiropoulos, CEO at CoreStates Capital Advisors told investors how to best prepare for the upcoming fourth quarter.
VIDEO0:0000:00CNBC Market Edge
“There are positive economic surprises that are going to come in the rest of the fall,” Merrill told CNBC.
“That’s what the leading economic indicators and markets are telling us.”
Merrill said today’s positive feedback loop is a mirror image of the negative feedback loop during the fall and winter of last year.
“Better economic numbers lead to better corporate earnings outlook, which leads to rising corporate and bond prices which in turn improves balance sheets and more economic growth,” he said.
More Investor Intelligence:
5 Things that Could Spook Investors in October2 Stocks Could Quickly Go From Trash To Treasure
Merrill is “overweight” Asia, saying the “rapid development” there and the rising middle class is going to be the engine of growth for the next decade.
He also likes high quality stocks such as P&G, Nestle and Walgreens. He said that although they’ve been laggards in the rally, that may change as the market progresses.
Spiropoulos said while the economy was dependent on consumers during the last two recessions, this time it will be supported by “good old fashioned corporate America and [U.S.] manufacturers.”
“We’re going to export, export, export good old fashioned American quality,” he added.
CNBC Data Pages:
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No immediate information was available for Merrill or Spiropoulos.
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0cf08dbcfa9724ee67dcebf56d43b691 | https://www.cnbc.com/2009/09/30/regulator-tried-to-steer-stanford-assets-to-ally-court.html | Regulator Tried to Steer Stanford Assets to Ally: Court | Regulator Tried to Steer Stanford Assets to Ally: Court
The top financial regulator in Antigua—who allegedly took hundreds of thousands of dollars in bribes from accused Ponzi schemer Allen Stanford in exchange for hiding the fraud—improperly tried to steer Stanford's assets to a British liquidation firm, according to a ruling by a Canadian court.
Leroy King, who was the head of Antigua's Financial Services Regulatory Commission, sought to put Vantis in charge of Stanford's assets on February 26, even though a U.S. court had already installed Dallas attorney Ralph Janvey as receiver ten days earlier.
The move set up a battle between Janvey and Vantis that continues to this day, with billions of dollars in investor funds caught in the middle, and may have given an ally of Stanford partial control of his assets even though Stanford had been accused of a massive fraud.
Allen StanfordAP
As a result, the Montreal Superior Court, one of several jurisdictions trying to unwind the Stanford empire, has revoked Vantis' authority as liquidator, citing what the court called "reprehensible conduct" by the firm.
Vantis was seeking to sell off Stanford's vast holdings in Antigua—infuriating investors who claimed the properties were bought with their money. But Janvey, the U.S. receiver, has also angered victims with his attempts to seize control of all the investors' remaining funds and distribute them among all investors.
A federal grand jury in Houston indicted King in June for his role in Stanford's alleged $8 billion Ponzi scheme. King remains in Antigua pending his extradition to the U.S.
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4604f8cda172e8c78312c89d5369b739 | https://www.cnbc.com/2009/09/30/saturn-final-orbit.html | Saturn: Final Orbit | Saturn: Final Orbit
After 20 years, plenty or promise, and plenty of "what ifs", Saturn is approaching the end of the road. The brand GM created and proudly called "a different kind of car company" is falling victim to the same fate as Oldsmobile -a sister GM brand back in the 90's.
2008 Saturn Aura
The fact GM and Penske Automotive Group could not finalize their deal is a bit of a surprise. Largely because Penske was so close to wrapping up the deal. But when a potential third party supplier of autos told Penske it would not build vehicles for the Saturn brand, Penske told GM he no longer wanted Saturn. And instead of looking for another buyer, GM is simply winding down the brand. Talk about things coming undone quickly.
It's one more un-fulfilled promise for a brand GM once held up as an example of how it could change and take on foreign competitors.
Just four years after it started in 1990, Saturn sales hit their peak at just over 286,000. Heck, Saturn dealers were selling more cars on average than dealers of other major brands. The "no haggle" model for buying a car was part of the Saturn appeal. And in 1995 when thousands of Saturn owners met at the Saturn plant in Spring Hill, Tennessee, many of us said, "ahhh, what a great story."
16 years later it's a far different feeling. Yes, Saturn has a great dealer network, loyal owners, and squeaky clean image. None of that matters if you don't have product to push. For years Saturn was a forgotten brand at GM. If I had a dollar for every time a GM or Saturn executive said, "We just need fresh models, then Saturn will come back", I'd be rich enough to buy a Saturn dealership myself.
Click Here for After-Hours Penske QuotesSlideshow: Are You Driving One of America's Most Ticketed Cars?
For all their talk, and occasionally rolling out new Saturn models, GM never gave this brand a chance to truly thrive. In the late 90's they deprived Saturn of new models. Then the company focused marketing dollars on the HUMMER and Chevy brands. Finally, about 5 years ago, GM inally turned on the product pipeline for Saturn. The Sky, Vue, and Aura brought someattention, but little in sales.
While I understand why many will be sad at the death of Saturn, it's probably best for GM to move on and quit wasting time trying to find another buyer for the brand. The promise at GM now is in building off its strengths, not in helping a brand that generated just 4 percent of the GM sales this year.
So long Saturn. You could have been a different kind of car company, if GM would have made some different choices over the last 20 years.
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9ac5a8abd60e7af4f262b355c9f13063 | https://www.cnbc.com/2009/09/30/small-adjustments-that-yield-big-dividends.html | Small Adjustments That Yield Big Dividends | Small Adjustments That Yield Big Dividends
Successful job searches often turn on small details – the confidence in your hand shake, the banter at a networking event, the typo that sinks a resume.
The best candidates dot the i’s and cross the t’s in everything they do.
Here are examples of small adjustments you can make to take your job search to the next level:
Put your LinkedIn hyperlink in your email signature.
Many times you email for networking, and attaching a resume is presumptuous. The link to your online profile is less imposing but gives people an invitation to check out your background. Keep in mind that even when you network for informational purposes the people you approach will want to know your background to see if they want to spend their precious time with you.
Practice the voicemails you leave.
It never ceases to amaze me how unaware people are of how fast they talk, how they jumble their words, how they ramble and how unclear their request is. Prepare your potential message when you call key contacts because you are likely to get their voicemail. You want a succinct, engaging and clear message. Practicing on your own phone gives you a chance to hear what your targets hear.
Coach your friends and family.
You might be able to spot opportunities that interest you. You might be able to pitch yourself for consideration. But can your loved ones do that?
Too often, we don’t let our friends and family know what suitable opportunities are and how they should talk about you if one of those opportunities presents itself. This is a wasted chance to have additional eyes and ears on the market.
PS. If you can’t relay to them what you want and why you’re a fit, then you can’t do it to a stranger, and that means you need to work on your pitch.
PPS. Now that they are on the lookout for you, do the same for them.
More Executive Strategies on CNBC.com Including: Where To Find A Job NowHottest States For Green JobsToday's Riskiest Jobs
________________________________Caroline Ceniza-Levine is a career coach, writer, speaker, Gen Y expert and co-founder of SixFigureStart (www.sixfigurestart.com), a career coaching firm comprised of former Fortune 500 recruiters. Formerly in corporate HR and retained search, Caroline most recently headed University Relations for Time Inc and has also recruited for Accenture, Citibank, Disney ABC, and others. Caroline is Adjunct Assistant Professor of Professional Development at Columbia University, School of International and Public Affairs and posts at CNBC Executive Careers and Vault.com.
Comments? Send them to executivecareers@cnbc.com
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2c9e5d33e6cc11d4cffccf08de348fd6 | https://www.cnbc.com/2009/09/30/stingy-santa-is-coming-back-this-holiday-season.html | Consumer Nation | Consumer Nation
Retailers, take a cue from Wal-Mart Stores: Shoppers will again be making a list and checking it twice this holiday season.
VIDEO0:0000:00Countdown to Christmas
Despite signs that the economy is improving, Americans are still skittish about spending. A new survey from The Nielsen Company projects holiday sales will only rise 0.03 percent this year, to $90 billion in dollar sales.
To win those sales, retailers will need to offer consumers a sense that they are getting a lot for their money. That may be why Wal-Mart announced it is supersizing its selection of $10 toys.
In the Nielsen survey, 42 percent said they plan to spend less this holiday season than last year. That's an increase of about 7 percentage points from last year in the number of people who say they will be tightening their belts and spending less at holiday time. What's more, those cutting back came from all income levels.
"What we are seeing really is a what consumers have been doing for the better part of 19 to 20 months, and that is reining in their spending," said James Russo, vice president of Global Consumer Insights at Nielsen, in an interview on CNBC.
Consumers have "retrained their consumption" because of the reccession, Russo said.
So what will folks buy this holiday season? Nielsen projects households will be focusing on "essential gift-giving" such as staple consumables, candy, alcohol and entertaining at home.
Shoppers also will be heading to "value" channels such as dollar stores and discounters to pick up traditional items such as apparel and toys.
Items such as DVD players and Blu-Ray players also should sell well, because consumers are focused on options for in-home entertainment.
Slideshow: 2009's Hot Holiday Toys
That means less money will be spent in luxury categories such as jewelry, travel, and high-end apparel, Nielsen said.
Also, don't bank on Black Friday. The focus on value means consumers will be shopping more carefully, and will likely start their holiday shopping well in advance of the Thanksgiving holiday, which was once thought of as the traditional start of the holiday shopping season.
It seems retailers have been starting their holiday efforts earlier and earlier each year.
Wal-Mart will return to last year's playbook, and cut toy prices beginning in October. This year's effort has been expanded to include more than 100 toys, from Barbie dolls to board games, each offered for $10 throughout the Christmas shopping season.
According to Wal-Mart, about 70 percent of its shoppers start their holiday toy shopping before Halloween, and about 20 percent are done shopping by Halloween.
A $10 hamster made the hot holiday toy listcompiled by Toy 'R Us. That list, released last week, included pricier items such as netbook computers, but overall the list provided more inexpensive items than did a similar list issued last year.
Toys 'R Us said Thursday it plans to hire about 35,000 seasonal employees, which is about equal to the work force it hired during each of the past two holiday seasons. The toy retailer announced plans earlier this month to add nearly 350 temporary "Holiday Express" stores in malls and inside its Babies 'R Us stores nationwide.
Electronics retailer Best Buy will be hiring more staff and putting a big push on promoting its in-store services as a way to attract shoppers to its stores.
Best Buy has gained market share since the demise of rival Circuit City, but it still faces competition from Wal-Mart and Target. Promoting its services, which include its "Geek Squad" computer repair assistance, can help differentiate it from the discount stores.
According to a report from Reuters, Best Buy CEO Brian Dunn said he expects flat-screen televisions, Blu-Ray players, digital eReaders, smartphonees and netbook computers to be popular gifts this holiday season.
More from Consumer Nation:
Don't Bet on Retailers to Boost Hiring This Holiday SeasonDon't Believe Retail Sales—The Consumer Isn't BackUnwrapping Toys 'R Us's Holiday Plans
Questions? Comments? Email us at consumernation@cnbc.com
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22961c1548db7afa4683ef34c4a5106e | https://www.cnbc.com/2009/09/30/stocks-close-lower-as-strong-quarter-ends.html | Stocks closed out the quarter on a low note after rough economic data left investors questioning the strength of the recovery. In fact, the top drags in Wednesday's session were some of the quarter's best performers, including industrials, materials and banks .
3RD QUARTER WINNERS TODAY'S LOSERS
3rd Quarter WednesdayFinancials (XLF) +25% -1% Industrials (XLI) +21% -1% Materials (XLB) +21% -1%
Even so, the Dow -- up 15 percent this quarter -- marked its best quarterly performance since the fourth quarter of 1998, while the S&P 500 notched its second straight quarterly advance of 15 percent. The Nasdaq gained 15.7 percent for the third quarter.
VIDEO0:0000:00Word on the Street
What’s the trade?At first, I expected the market to completely breakdown today, says Guy Adami. But it didn’t. And when it reversed I thought it was going to explode higher and it didn’t do that either. It’s very interesting.
It’s sudden death, adds Joe Terranova. We’re watching the battle of the bulls and the bears. I’m still bullish long-term, adds Steve Grasso. But I noticed that when the S&P hit 1063 investors moved to the sidelines. That suggests a great deal of caution going into October.
There seems to be a chase in this market, says Karen Finerman. I remain mostly bullish because I think there’s a lot of money on the sidelines and it continues to chase returns.
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BREAKING NEWS: KEN LEWIS TO STEP DOWN BY END OF YEAR.
In the after hours, shares of Bank of America moved higher after CNBC’s Charlie Gasparino revealed that, according to his sources, Bank of America CEO Ken Lewis has decided to step down from his position at the company by the end of the year.
Gasparino emphasizes that Lewis was not pushed out – the resignation was completely his decision. Minutes later Bank of America confirmed the news.
What’s the trade?I think it’s mildly positive for the stock, muses Karen Finerman. The resignation isn’t a huge surprise.
It makes me wonder if more trouble lies ahead for Bank of America, muses Guy Adami. However I do think BAC is an investible stock, long-term.The market seems to find the move a positive because so much anger is focussed on Ken Lewis, explains analyst Dick Bove. But Ken Lewis is a brilliant bank executive and I think it's a loss. For him to be pushed out is almost outrageous.
And I'd assume that Brian Moynihan is the front runner to take over, adds Bove.> For complete coverage of this developing story click here.
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BREAKING NEWS: PENSKE/SATURN DEAL FALLING APART
On WednesdayGM announced plans to wind down its Saturn brand after Penske ended talks to acquire the business.
An agreement with another manufacturer to make the cars fell through, and "without that agreement, the company has determined that the risks and uncertainties related to the availability of future products prohibit the company from moving forward with this transaction." Penske said in a statement.
As you may remember, in June, Penske agreed to take over the Saturn brand and related dealerships, with GM producing the vehicle for a limited period of time.
What’s the trade?
I’m not sure there’s a trade off this, says Guy Adami. Maybe get long Ford .
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TOPPING THE TAPE: OIL SURGES
Oil prices surged more than 5 percent to settle above $70 a barrel on Wednesday, buoyed by a drop in gasoline supplies.
Further price support came from a weak dollar, which makes crude more affordable for buyers using other currencies.
However for the quarter, crude futures were little changed, up 72 cents from the June 30 close of $69.89 a barrel.
What’s the trade?
Gasoline drives the energy complex, explains Joe Terranova. I’d look at refiners such as Sunoco . And I’d get long commodities, he adds. I expect to see the dollar under pressure in Q4 and as a result oil, gold and other metals should rally.
I’m still concerned about the CFTC, says Karen Finerman. There’s potential regulation looming for the oil markets.
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TOPPING THE TAPE: GOLD SPARKLES TO END QUARTER
U.S. gold futures closed above the psychologically important $1,000 an ounce level on Wednesday, with a weaker dollar, the crude oil rally and simmering geopolitical tensions in the Middle East driving demand.
What’s the trade?
Gold has had every reason to go down but it hasn’t, says Joe Terranova. I’m bullish and I established a long position.But it had every opportunity to go up and it didn’t either, adds Guy Adami. However I do think it goes higher in the near term. But the trade scares me.
______________________________________________________Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send those e-mails to .CNBC.com with wires
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5b47eccb30c9d24fa869606a4bcf363a | https://www.cnbc.com/2009/09/30/suicides-in-france-put-focus-on-workplace.html | Suicides in France Put Focus on Workplace | Suicides in France Put Focus on Workplace
A recent spate of suicides at France Télécom has revealed a paradox at the heart of French society: Even with robust labor protection, workers here see themselves as profoundly insecure, with many complaining about being pushed beyond their limits by the pace of economic change.
In statistical terms, the 24 suicides since February 2008 at France Télécom — including eight since the beginning of summer, with the latest confirmed by the company on Monday — are not extraordinary for a group employing 102,000 people in France.
French FlagAP
The World Health Organization puts the suicide rate in France at 26.4 per 100,000 for men and 9.2 for women in 2005. That is the highest among large Western economies, but still well behind Japan, Belgium and several Central and East European countries. In the United States, the comparable rates are 17.7 for men and 4.5 for women.
What has caught the attention of the French media, public and government is that many of the suicides and more than a dozen failed attempts have been attributed to work-related problems by some experts and labor officials.
Adding to the furor is what Marie-France Hirigoyen, a psychiatrist who did pioneering work in France on bullying and workplace relations, described as the “spectacular” nature of some: In one case a man stabbed himself in the stomach in the middle of a meeting (he lived); in another, a woman killed herself by leaping from a fifth-floor office window. On Monday, a 51-year-old employee who worked in southeast France threw himself off a highway bridge.
The popular image outside France is of a work force that is pampered and protected from the damaging side effects of globalization by tight job security and the 35-hour work week. But the reality is often very different, according to experts, union representatives and the workers themselves.
“Stress has become a national sport,” said Michel Marchet, the secretary of the banking chapter of the C.G.T., a leading union in France. “We need employers to modify the way that they organize work, but we don’t have the impression that anything will happen soon.”
High labor costs — health insurance, unemployment, pensions — borne by employers in France create a reluctance to hire new workers, because job security means it is hard to get rid of them later if business turns down. Since those already on the payroll cannot be easily laid off, then companies must somehow make a place for them, even if their skills are no longer in demand. At the same time, companies increasingly rely on short-term employment contracts, which raise different strains on employees.
The seemingly comfortable French lifestyle has been made possible by the high productivity of the country’s workers. France ranks fifth in the world in terms of gross domestic product per hour worked, just behind the United States, according to a July report from the U.S. Bureau of Labor Statistics. (Norway, with its oil wealth and tiny population, ranked No.1, followed by Belgium and the Netherlands.)
Yet even before the global economic downturn, Dr. Hirigoyen argued that job-related anxiety among the French has replaced most other concerns.
“When I started as a psychiatrist, 35 years ago, my patients were talking about their personal lives,” she said. “Now it’s all about their jobs. People are suffering in the workplace. They shouldn’t be, from the logic of management. After all, they have a good job, a nice vacation. But they are suffering.”
In 2006 and 2007, three technicians working at the automaker Renault’s research and development facility near Paris, committed suicide, according to Benoît Coquille, a company spokesman. At the time, union leaders cited pressures on the job. In response, Carlos Ghosn, the Renault chief executive, went to the facility to talk with workers and managers. Detailed questionnaires were sent to more than 11,000 employees and face-to-face meetings were held to discuss working conditions. Mr. Coquille said the company decided to go back and explain again basic management rules throughout the chain of command to make sure they were understood.
It is impossible to say that there have been no more work-related suicides, Mr. Coquille said, but since then, “there haven’t been any with an obvious connection to the job.”
France Télécom has now hired Technologia, the same consulting firm that helped to guide Renault’s response, to assess its own situation.
France Télécom is in a unique position: Despite a partial privatization in 1997, two-thirds of the company’s work force is still classified as public servants and cannot be fired. And yet it is being required to compete with private companies in a fast-moving, global market.
From 2006 through 2008, France Télécom cut more than 22,000 jobs through “voluntary departures.” Nearly half of those were workers who either took early retirement, accepted transfers to civil service positions outside the company, or left to start their own businesses with the company’s backing.
By comparison, BT Group, the former British telephone monopoly that has been carrying out its own wrenching restructuring, cut 15,000 jobs in 2008 alone and has said it will cut another 15,000 this year. BT has also sought to minimize layoffs of its core group workers, instead sharply reducing the use of contractors and shuffling employees internally to fill the gaps.
Part of the problem may be that big companies like France Télécom — in which the government is still the largest single shareholder, with 23 percent — have a de facto social mission as guarantors of jobs in a country where new, good ones can be hard to find.
Sébastien Crozier, head of the CFE-CGC union at the company, estimated that over the past five years, half of all France Télécom employees had either changed jobs internally, changed work locations, or both. That, he said, has created a sense of constant upheaval and insecurity. Furthermore, he said, there is a sense that managers are deliberately trying to get employees to quit.
No matter how bad things get, Mr. Crozier said, giving up civil service status would mean sacrificing retirement benefits, so many people try to hold out, even if it means they have little of substance to do or they feel they are not being used effectively.
In response to a flurry of media attention, France Télécom has said it will freeze worker transfers until the end of October, establish an anonymous help line for troubled employees and add extra psychological and human resources support. “We are the only incumbent telecoms operator not to have carried out mass redundancies,” Olivier Barberot, France Télécom’s head of human resources, said.
“Most people, the bulk of them, have been able to increase their skills and move on to new jobs,” he said. “But some have had difficulty adapting.”
During an interview, Xavier Darcos, the French labor minister, said the problem of workplace stress was not confined to France.
CNBC Slideshows
The U.S. Cities with the Worst Road RageParis Air Show, 2009
But he criticized the company’s previous approach, saying future restructuring would be “better supervised.”
“Maybe he underestimated the effect of the transformation on staff and the media impact,” Mr. Darcos said of the chief executive of France Télécom, Didier Lombard.
But, echoing comments by Mr. Lombard and Mr. Darcos, Mr. Barberot, the company’s human resources chief, said that some changes were inevitable. “We can’t stop the reorganization,” he said.
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2ddb6e63fcd296b328359862b6579220 | https://www.cnbc.com/2009/09/30/trading-in-a-treacherous-market.html | Trading in a Treacherous Market | Trading in a Treacherous Market
NASDAQ turns positive midday. Cisco and Intel leading the tech advance off the bottoms. Other big names outside the NASDAQ have also turned green: American Express, Goldman Sachs, IBM and Caterpillar.
Going Positive
This highlights a real problem traders have: this is a treacherous market to trade in. Traders have been heavily shorting the market all morning, but the Dow has cut its losses in half, moving from down 128 to down only 50.
In addition to the last day of a big up quarter, traders are having to deal with the uncertainties of the market in September and October, notoriously difficult months.
"It's like trying to trade in the Bermuda Triangle," one trader told me this morning. "The Howlies are out!"
Was the Chicago PMI leaked? It depends on what you mean by "leaked." Several traders furiously demanded to know why the markets had dropped several minutes before the Chicago PMI came out at 9:45. Many insisted that the information had been leaked.
Go to the Web site of Kingsbury International, the organization that compiles the Chicago PMI and you will see this blurb: "Your subscription gives you access to this market-moving data 3 minutes before public release in addition to funding the business survey."
So for $200 a month you can get access to the info at 9:42 AM instead of 9:45 AM. Coincidentally, this was almost exactly the time the markets began dropping.
Mystery solved.
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ae5fc64c0b3a17963d5550af6f1dc622 | https://www.cnbc.com/2009/09/30/usher-blair-lula-clinton-bartiromothe-slideshow.html | Usher, Blair, Lula, Clinton & Bartiromo-The Slideshow | Usher, Blair, Lula, Clinton & Bartiromo-The Slideshow
We've just now had a chance to put together all the great images of what we captured at the recent .
It truly was a wonderful gathering of the world's leading thinkers, politicians and newsmakers.
Take a look at some of the people we got to meet and who sat down for an interview with Maria Bartiromo.
Slideshow - Maria Bartiromo at the Clinton Global Initiative The Dow 30 in Real TimeThe CNBC Stock Blog
Questions? Comments? Write toinvestoragenda@cnbc.com
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dff6d38c98e6e7d316b3ceeaa377a92c | https://www.cnbc.com/2009/09/30/want-to-stop-texting-and-driving-why-not-jam-cell-phones.html | Want to Stop Texting and Driving? Why Not Jam Cell Phones? | Want to Stop Texting and Driving? Why Not Jam Cell Phones?
Texting and driving
This is an idea that will get a lot of people up in arms.
With evidence mounting that texting and driving is more dangerous than drinking and driving, nearly everyone agrees that it is a huge problem that must be stopped. Sure, 18 states have made it illegal to text and drive, but the fact is many people-especially teens-continue to type away while behind the wheel. So why not take the next step, and have cars come with a device that jams cell phone signals for those in the driver seat?
I know, some of you are reading this and saying, "No way! I can stop texting and talking while driving, I don't want anyone knocking out my cell phone." Like anyone else, I hate to lose my ability to communicate, but the idea is not a crazy one. A company in Doylestown, Pennsylvania called Trinity Noblehas patented technology in its Guardian Angel jamming device. The Guardian Angel jams the cell phone signal of the person sitting in the driver seat a car going over 10 miles per hour. In other words, the drivers cell phone does not get a signal. Joe Brennan with Trinity Noble says, "we filed the patent in 2001 and the patent was actually granted in 2006 at the end of 2006 by the same government that is saying the technology is illegal."
VIDEO0:0000:00New Tech Aims to Stop Distracted Drivers
That's right, jamming a cell phone signal is against the law. Since 1933 the FCC has steadfastly opposed any attempts to interfere with wireless signals. CTIA-The Wireless Association agrees with the FCC position and thinks jamming the cell phone signals is not a wise move. John Walls with the CTIA says, "Jamming technology is imprecise, it is very difficult to maintain, and it certainly can interrupt legitimate service in a number of different ways."
This baffles me for a number of reasons.
On one hand the federal government wants drivers to stop using, looking, and typing on their handheld devices or cell phones. On the other, the government is against a simple solution to guaranteeing people stay off their phones while behind the wheel. At the heart of the opposition to jamming is a concern that it takes away a drivers freedom to call or contact others while they are driving. Actually, if you run your phone through your car, you'd still have that freedom. And since putting the Guardian Angel or some other jamming device in a car would be voluntary, those who still want to have access to their phone would not be impacted.
On CNBC.com now - Cities With The Worst Road Rage
What's really at issue here is whether the federal government will take a different approach to solving a growing problem. You can pass all the state laws you want and run all the shock value commercials you want, but many people will continue to text. I know they will because I have numerous friends who have told me, "I know it's illegal to text and drive, but I still do it."
So why not let parents or others who can't control themselves put jamming devices in their cars? We put in-car breathalyzer ignition switches in the cars of those convicted of drunk driving and nobody complains that we're violating the rights of those drivers? If texting and driving is as dangerous as drinking and driving, why not take a similar approach with signal jamming devices?
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Questions? Comments? BehindTheWheel@cnbc.com
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f2e1f390bae3f9a38e7945b9bd6f7e50 | https://www.cnbc.com/2009/09/30/web-extra-finermans-restaurant-trades.html | If you think all restaurant stocks are created equal, think again. Find out which 3 names Karen Finerman finds attractive and the one she wouldn't dare touch!
This content is only available online - you won't find these trades on TV.
VIDEO0:0000:00Fast Money Web Extra
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Trader disclosure: On Sept. 30th, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU); Finerman's Firm Owns (BAC) Preferred Shares, (BAC), (BAC) Call Spreads; Finerman Owns (BAC) Preferred Shares And (BAC); Finerman's Firm And Finerman Own (WFC) Preferred Shares; Finerman's Firm Owns (BKC), (DRI), (MSFT), (YUM); Finerman's Firm Is Short (CAKE), (TLT), (USO), (IJR), (IWM), (SPY), (MDY), (USO), (UNG); Grasso Owns (AAPL), (ABK), (ASTM), (BAC), (C), (COST), (CSCO), (PFE), (PRST), (V), (WMT), (FAZ); Terranova Owns (FCX), (ANR), (SU), (BUCY), (GEX), (POT), (CAM), (MSFT), (AMZN), (GDX), (KCE), (ABT), (SUN); Terranova Owns (XOM) Calls; Terranova Owns (FTO) Calls; Terranova Is Short (GRMN), (ESS), (CCL), (FII), (JWN), (JCI), (WYNN); Terranova Owns March Sugar Futures; Terranova Owns December Copper Futures; Terranova Owns December Crude Oil Futures; Terranova Owns December Gold FuturesGE Is The Parent Company Of CNBC
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fe1646dcb22435ed76ded1dacc3d06d3 | https://www.cnbc.com/2009/09/30/who-do-we-want-on-twitter.html | Who Do We Want On Twitter? | Who Do We Want On Twitter?
Twitter
For months, we've given you the top monthly Sports Twitter Rankingsand it has been fun to keep up with everyone in the business.
But we wanted to do something fresh this month. So we give you the top 10 people in sports we WANT to be on Twitter and why.
1. Tiger WoodsSuggested Twitter Handle: @Elinshusband
We know it's never going to happen, but every sports fan wants to get inside his head. Twitter could get us closer to understanding him off the course.
2. Dan SnyderSuggested Twitter Handle: @DannySny
With George Steinbrenner relegated to inactive, we think the Redskins owner would be the guy who would flip out the most and would be a fun follow - especially if the team isn't doing well.
3. Mike Tyson Suggested Twitter Handle: @Imallear
Out of all the ex-athletes we can think of, it's hard to believe that anyone could generate more of a following than Tyson could.
4. Ed HochuliSuggested Twitter Handle: @rippedref
We don't expect anything too controversial, but since NFL officials don't really talk to the press unless something has gone horribly wrong, we think this 20-year veteran could provide some incredible nuggets of color commentary. Nothing during the game, of course.
5. Kyle BuschSuggested Twitter Handle: @thekylefiles
There's not a more polarizing character in all of sports than Kyle Busch. This guy is an unfiltered powder keg and we can imagine him firing back missives to some of his haters. Then again, his main sponsor, M&M's, might mute him if he gets out of control.
6. Famous Chicken, aka The San Diego ChickenSuggested Twitter Handle: @bockbockbock
The guy who has been in the costume for all these years, Ted Giannoulas, is actually a brilliant man who has probably shared the same one percent of his war stories in his decades in the costume. We'd love to hear some of the others, in 140 characters or less of course!
7. Bode MillerSuggested Twitter Handle: @itsalldownhill
Now that the skier is back on our radar for '10 Games, we'd like to hear some new axioms from the guy who made as much noise as an Olympic flop has ever made.
Lingerie Scandal Costs Miss Singapore World Crown
8. Plaxico BurressSuggested Twitter Handle: @thatsmysoap
Forget the tell-all exclusive from the former New York Giants wide receiver when he gets out of prison. It's much more valuable as a blow-by-blow.
9. Melanie Oudin Suggested Twitter Handle: @believeit
Sure she has signed some endorsement deals, including a new one with AirTran, after her amazing US Open run, but Twitter can help her hold some of her fans so she doesn't fall off the face of the earth until next August.
10. Chris PetersenSuggested Twitter Handle: @papasmurfturf
He has reserved the name CoachPeteBoise, but the Boise State football coach hasn't tweeted. With his team now ranked No. 5 in the country, we still feel like we don't know him. Twitter allows us to be that fly on the wall. A pitch to Coach Pete? If you are good at it, it can only help recruiting. Then again, most coaches who have taken to Twitter have proven to be either boring, inept or both.
Questions? Comments? SportsBiz@cnbc.com
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e1cf5bc13219fea11d5db8862d006903 | https://www.cnbc.com/2009/09/30/why-are-options-traders-gobbling-up-this-grocery-stock.html | Why Are Options Traders Gobbling Up This Grocery Stock? | Why Are Options Traders Gobbling Up This Grocery Stock?
Supervalu has been outperforming other grocery stocks recently, and now at least one investor is looking to get long before the next earnings report.
Volume in the January 17.50 calls rose to 4,200 against open interest of 3,743 contracts, according to 's tracking programs. Most of the trades priced at $0.55 — and purchases dominated the activity.
___________________________CNBC/ Trading School:
Options Terminology: GlossaryBasic Strategies — with ExamplesOptions Basics: The ABCs
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SVU stock fell 1.78 percent to $14.93 in morning trading. The stock is up 16 percent in the last three months, compared with a 6.71 percent drop by Kroger and a 3.6 percent decline for Safeway over the same period.
SVU needs to rally 21 percent by expiration for the calls purchased today to turn a profit. The company, still laden with debt from its purchase of Albertsons locations in 2006, has been climbing despite lowering its profit forecast on July 28. The next earnings report is expected to come out about Oct. 20.
Overall options activity in the name was five times greater than average, with calls outnumbering puts by more than 70 to 1.
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David Russell is a reporter and writer for .
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Disclaimer
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a75fd86e8b2b52104ee4aab92832ff4c | https://www.cnbc.com/2009/09/30/why-not-eliminate-the-capgains-tax-for-everyone.html | Why Not Eliminate the Cap-Gains Tax for Everyone? | Why Not Eliminate the Cap-Gains Tax for Everyone?
The Case-Shiller home-price index increased yesterday for the third month in a row. That’s terrific news. After a 40 to 50 percent drop in home prices in recent years, sales are picking up, because prices are way down. That’s also great. Markets work.
But here’s what I don’t like about this story: Big, central-planning, government-directed tax preferences for housing, like the $8,000 dollar tax credit for new buyers. Or even the popular mortgage interest deduction. And let’s not forget perhaps the biggest one of all: Home sales are basically capital-gains-tax free. That passed back in 1997. Many people (including myself) believe it helped create the bubble.
Why not eliminate the capital-gains tax for everyone and all sectors, including investors and stocks and bonds? Why direct it only to housing? Let’s abolish the capital-gains tax altogether. Let’s quit double-taxing investment, which is what capital gains does. But let’s do it for everyone and everything — not just housing. While we’re giving all these preferences to housing, what about manufacturing? What about transportation? Or health care? Or any other sector in the economy for that matter?
Slideshow: How Your Tax Dollars Are Spent
We also could be cutting business tax rates across-the-board for companies big and small.
And for all individuals and businesses, why not a simple, low, flat-rate tax? Somewhere between 15 and 20 percent? Get rid of all of the special preferences and deductions in the code. Stop favoring one sector at the expense of the others. Incidentally, this would stop the corruption of K-Street lobbyists who love to get these preferences in there.
Let’s make the tax code simple, fair, and pro-growth, to unleash prosperity. Let’s stop the political direction of the economy, and let’s substitute a market direction of the economy. A true flat tax would do it.
Homeowners Fall Behind—Even After Loan Modifications
If you get to keep more of what you earn and invest at the lower tax rate — if you tax something less — you’ll get more of it. If you tax the whole economy less — not just housing, but the entire economy — you will get a much more prosperous and healthier economy. At a time when we’re all worried about economic growth, we ought to be thinking hard about this.
Questions? Comments, send your emails to: lkudlow@kudlow.com
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be7581c67d5cd9e62d51c816e3110897 | https://www.cnbc.com/2009/09/30/will-1-million-credit-limit-hurt-score.html | Will $1 Million Credit Limit Hurt Score? | Will $1 Million Credit Limit Hurt Score?
Q: Dear Credit Card Adviser,I have approximately 20 credits cards with a combined credit limit well in excess of $300,000. At the start of this credit crunch I read about "use it or lose it" regarding credit cards.
credit cards
Since that time, I have been regularly rotating and charging my credit cards to give the impression that I use them on a regular basis. I never carry a balance and always pay the full amount owing on or prior to the due date. In the credit card world I am known as a "deadbeat," but my question to you is, with so many credit cards with balances that even though combined never ever exceed 10 percent of my credit availability, does that in and of itself lower my credit score?
P.S. My goal is to reach $1,000,000 in credit card limits; any advice without ever going into debt?-- Credit Card Junkie
A: Dear Credit Card Junkie,It's true that some issuers are closing inactive accounts, and I do recommend people use cards they wish to keep. I also must commend you for paying in full each month.
That said, I'm appalled that you want $700,000 in additional available credit. That's a goal that is risky and pointless. While your FICO credit score won't decline because of numerous credit card accounts, it could drop due to a missed payment on one of your many cards. I am concerned that you may be adding too many due dates and debt obligations. Unless you only charge items you need, each new card represents more unnecessary spending -- all for the sake of a $1 million total credit limit, for which you get no point boost.
_____________________________________More Stories from Bankrate.com:
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Remember that your debt-to-credit limit ratio, or utilization, is what matters, not the limits themselves. If your utilization is already low, then adding more accounts probably won't boost your score much. In fact, inquiries from new accounts can ding your score temporarily.
Now on to your actual question about whether too many credit card accounts with balances can damage your score. The answer: Yes, it can.
"It's true that having a large number of revolving accounts with balances can hurt your score, as compared with having only a few accounts with balances; with the extent of negative impact being less when there's low versus high overall utilization on those accounts," said Barry Paperno, consumer operations manager at FICO, in an e-mail statement. The impact depends on the other information in your credit report.
He said the threshold at which a person would have too many revolving accounts with balances depends on the person's score card. A person's score card, or the specific FICO formula applied to a group of borrowers with similar credit profiles, depends on factors in his or her credit report, such as length of credit history, number of accounts and the presence or absence of derogatory information.
While the overall utilization looks stellar, the FICO formula also measures utilization by the highest utilization on any one revolving account. If someone charged a high amount on one card, for example, but didn't blow the total utilization of 10 percent, "this situation could result in a lower score than if his overall 10 percent utilization consisted only of accounts with low individual utilization," Paperno wrote.
My advice: Let your accounts age and put away the applications. Continue to pay in full every month and charge small amounts on the cards in use. Keep up the good work on the teeny overall utilization.
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035a7a0c78ffdf625235c20539a8da8d | https://www.cnbc.com/2009/10/01/an-interview-with-the-next-president-of-the-united-states.html | An Interview with the Next President of the United States? | An Interview with the Next President of the United States?
VIDEO0:0000:00Sen. Hutchison on Health Care Reform
Last night I had the pleasure of interviewing an old friend of the program, Texas Republican Senator and gubernatorial candidate Kay Bailey Hutchison.
Among other things, we discussed why she's leaving Washington and heading back home to run against Gov. Rick Perry for the Governor's seat.
I'll just say this: If she wins in Texas, she'll be president in 2012.
More on CNBC.com
Slideshow: How Your Tax Dollars Are SpentUS Faces Retro 70s Inflation: Jim Rogers
Questions? Comments, send your emails to: lkudlow@kudlow.com
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60795e565012e700fa833888768a3538 | https://www.cnbc.com/2009/10/01/are-we-prime-for-a-historic-tech-ma-surge.html | Are We Prime For a Historic Tech M&A Surge? | Are We Prime For a Historic Tech M&A Surge?
Cisco's play for Tandberg is a real sign of the times for cash rich tech companies. Here's a company trading at or near its 52-week high, and yet dips into its swollen coffers and pays for the $3 billion deal all in cash. And why not, with $35 billion in cash on the balance sheet, Cisco can certainly afford it.
Slideshow - 20 Stocks with the Potential to Pop
The deal is potentially a blockbuster for Cisco, especially as it continues to open new competitive fronts against its rival Hewlett-Packard. Telepresence has been an enormous success for Cisco, and continues to grab market share from HP's rival system called Halo. Cisco says it has sold something like 1,000 of these systems over the past two years, and at a cost of several hundred thousand dollars a piece in some cases, there's no question that Telepresence can be a significant moneymaker. In fact, I was at Dreamworks in Glendale, Calif. a few weeks ago and that facility alone has three of them.
Cisco claims its Telepresence (a technology that I have talked a lot about on this blog) has saved the corporations that install it hundreds of millions of dollars in travel expenses alone, not to mention the savings in time, and the improvements in efficiency. There's little question that Tandberg and its long list of customers (HP even resells some Tandberg equipment. Wonder what happens to that arrangement?) will improve Cisco's Telepresence footprint in Europe, as well as elsewhere around the world.
Slideshow - CES Highlights Over The Years
And the Tandberg deal fits right into Cisco's broader vision of a robust, global computer network sending and receiving as much data as possible. The network is Cisco's core, and deals like Tandberg, and Webex and Scientific-Atlanta and even Pure Digital earlier this year, fit into the broader scope of a world living on video, and relying on Cisco routers and switches to get it all from one computer to another.
Cisco could have easily paid for the deal with stock, but it chose cash, and why not. With $35 billion on hand, even after 134 acquisitions since 1993, not having to dilute shareholders for a deal like this is a pretty nice trick. If you've got it, flaunt it. And that could be the catch-phrase for a lot of big cap tech nowadays. Just last week, 24/7 reported that the top 20 names in tech are sitting on a whopping $335 billion cash. And Google, with $19 billion in cash in the bank, confirmed last week that it hopes to do a deal a month for the next 12 months.
Where is that cash? Cisco rival HP has $25 billion; Microsoft, $36 billion; IBM, $12.5 billion; Intel, $19 billion; even Qualcomm has $15 billion.
We've already seen some pretty intriguing M&A in tech: Dell and Perot; Oracle and Sun; Intel and Wind River Systems. And there's been lots of rumors about who might be next. Electronic Arts? I was hearing lots of rumors that Disney would make a play for EA, something that CEO John Riccitiello wouldn't outright deny when I asked him about it, and he even highlighted some of the synergies, but that was, of course, before Disney's massive deal for Marvel Entertainment a couple of weeks ago. Salesforce.com always seems to come up as a potential target, and I have long said that an app-hungry company like Google could make a deal like that work out. And Google could easily afford it.
Cisco Bets on Video Again with $3 Billion Tandberg Buy
I think the Cisco deal is hardly the last major deal. It's merely the latest, and investors should strap in: I think we're on the lip of an M&A frenzy the likes of which the tech world has probably never seen before.
Whole Lotta Tech
Questions? Comments? TechCheck@cnbc.com
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422f87b9ccf4a2a699774d41d28b7d9a | https://www.cnbc.com/2009/10/01/auto-sales-a-september-not-to-remember.html | Auto Sales: A September Not to Remember | Auto Sales: A September Not to Remember
We knew September sales would be terrible following the pop in July and August.
So when you see both GM and Chrysler down more than 40% it's not a shock.
Ford, after posting its first monthly sales gain in August, fell 8.8%.
Toyota down 6.1%.
You get the picture: few people were buying new cars or trucks last month.
And there are not many compelling factors pushing people to buy right now.
Slideshow: Are You Driving One of The Top Ten Gas-Sipping Cars
The economic recovery has yet to lead to substantial job creation, there were few worthwhile incentives in showrooms, and Cash for Clunkers depleted inventories of the hottest models people want.
So what did September show us? Here are a few of the numbers from the research firm Autodata.
1) Luxury sales/demand are picking up.
BMW was up 3.6% Porsche was up 8.4% Mercedes, Lexus, and Cadillac all posted much smaller declines than the overall market.
I wouldn't say it's time to proclaim the high end market is back again, but there is no doubt demand for luxury models is up.
2) Ford, Hyundai keep building off their momentum.
While Ford sales were down last month, the company has now picked up a full percentage point in market share. That's up two-tenths from where the company stood at the end of last month. Meanwhile, Hyundai sales shot up 27.2% last month. A spectacular move any month, but extremely impressive when total industry sales are down 29%.
VIDEO0:0000:00Breaking News: GM
3) GM's "former four brands" are paying the price.
Want proof of how much the sale or closing of a brand can hurt sales? Check out the September number for the four brands GM is getting rid of.
Pontiac: Down 52.5% Saturn: Down 83.8% Saab: Down 72.5% HUMMER: Down 81.5%
Listen, I understand these guys have little marketing right now, and many dealers have given up pushing them. It's always interesting though, to see how prospective buyers turn away from brands that are in flux or being eliminated.
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_____________________________________Click on Ticker to Track Corporate News:
- Ford Motor
- Toyota Motor
- Nissan
- Honda Motor
_____________________________________
Questions? Comments? BehindTheWheel@cnbc.com
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68a8d262220e44af183ca6fd416f9ae1 | https://www.cnbc.com/2009/10/01/china-ipo-supply-may-be-too-high-mobius.html | China IPO Supply May Be too High: Mobius | China IPO Supply May Be too High: Mobius
The recent surge in Chinese initial public offerings has made a lot of people a lot of money, but the market seems to be getting oversupplied and overvalued, Mark Mobius, executive chairman of Templeton Asset Management, told CNBC Thursday.
VIDEO4:0404:04Mobius: China is My Top EM Pick
“You’re seeing these IPOs come in at 20 times earnings, 30 times earnings. That’s a little bit too rich I think,” Mobius said. “I think there’s a little bit too much supply now.”
“The quality of some of these is not what it should be and of course the pricing has been a little bit too high,” he said.
- Watch the first part of the CNBC interview with Mark Mobius above, the second part here and the third part here >>>
The rush for Chinese companies to raise money by going public will continue because the recent success will give companies confidence to keep supply going, according to Mobius.
Even though the Chinese IPO market is showing signs of overheating, Mobius still considers the region to be the most attractive emerging market around. However, overcapacity could cause company failures ahead, he said.
“There will be failures, company failures, where there’s too much capacity and they’re not efficient,” Mobius said.
“There’s no question there is overcapacity in almost every direction in China. In housing, in manufacturing, you name it,” he said. “But this capacity will eventually be taken up.”
The Chinese government has been pumping money into the economy and encouraging banks to lend, which means that there definitely will be continuing investment, according to Mobius.
Mobius said he thinks the commodity market offers good investment opportunities, especially in Brazil and Russia. In the agriculture space, Mobius favors Brazil and the Ukraine.
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cd8704fd8905a9bac7ff93176d4580ac | https://www.cnbc.com/2009/10/01/cisco-bets-on-video-again-with-3-billion-tandberg-buy.html | Cisco Bets on Video Again with $3 Billion Tandberg Buy | Cisco Bets on Video Again with $3 Billion Tandberg Buy
Cisco has agreed to buy Norwegian videoconferencing company Tandberg for $3 billion in cash, its latest big bet that video will drive demand for its core data transmission gear.
AP
The acquisition will fill the wide gap between Cisco's high-end TelePresence video meeting service for executives and its WebEx tool used by millions of office workers for online meetings, and could bring videoconferencing to a mass market.
Tandberg's board has recommended the Cisco offer to its shareholders and Chief Executive Fredrik Halvorsen told investors that major shareholders had voiced support for the offer of 153.50 Norwegian crowns ($26.49) a share.
Halvorsen will continue to lead the unit if the acquisition goes through.
Shares in Tandberg, which had almost doubled in value this year by persistent takeover speculation, were 11 percent higher at the offer price of 153.5 crowns by 1348 GMT on Thursday, having traded at up to 156 crowns earlier in the day.
Cisco's shares were little changed in early U.S. trade, at $23.56.
In October 2008 Tandberg ended takeover talks with an unnamed private equity player, blaming market turmoil. A person familiar with the matter said the bidder was technology specialist Silver Lake Partners.
"This [the Cisco offer] sounds like a pretty good price so I would think it will end up there," said analyst Martin Hoff of Arctic Securities. "But the bid will stand for four weeks and there might be other [offers]."
Potential rival suitors include Hewlett-Packard , which is also active in Web collaboration. The market has also linked telecoms gear maker Ericsson with Tandberg.
DnB NOR Markets named in a report on Thursday Juniper , IBM , Sony and Siemens .
The offer values Tandberg at about 23 times 2010 earnings, analysts say, slightly above U.S. rival Polycom's multiple of 21.7.
More Agressive
The acquisition, if approved by shareholders and regulators, will be Cisco's biggest deal since the world's top maker of internet routers and switches bought WebEx for $3.2 billion in 2007.
Chief Executive John Chambers said Cisco, which had a cash pile of $35 billion as of July 25, would step up the pace.
"You're going to see us more aggressive over the next 12 months than you have seen us as a company," he told a news conference in Oslo. "We will be very aggressive with internal start-ups, partnering ... and also in acquisitions."
Technology merger activity is picking up as the market improves, and borders between sub-sectors are breaking down.
PC maker Dell recently bought IT services firm Perot Systems, and software maker Oracle bought hardware firm Sun.
Cisco said it hopes to close the deal in the first half of 2010, subject to regulatory approval. The acquisition would give the company a broad portfolio that rivals would struggle to match, although one anti-trust lawyer said he saw few issues.
"There doesn't seem to be any significant overlap in the companies' operations on the basis of the limited information we have available," said Morten Nissen at Brussels law firm Bird & Bird. "I don't see any major problems that can't be handled."
JP Morgan is advising Tandberg and Lazard is advising Cisco.
Network Traffic
Cisco says it can bring its network expertise to bear to make videoconferencing -- a tool it considers underused due to the difficulty of the technology -- a far smoother experience, and improve its popularity.
"Cisco's be-all and end-all is network traffic," Nomura analyst Richard Windsor said. "The idea is that if you improve the user experience for office workers, you improve the overall demand for traffic."
Tandberg also has its own 'telepresence' offering, designed gives the impression of conference participants being in the same room, which it launched earlier this year.
It is the first that can connect to systems of rivals including those of Polycom and Microsoft, removing the need for companies to buy whole systems from those providers.
Tandberg sells about 15,000-16,000 of its regular videoconferencing units every quarter for about $7,500 each, while Cisco has sold fewer than 10,000 in total of its TelePresence systems, which cost about $250,000.
Cisco estimates the total value of collaboration tools, including everything from videoconferencing to conference calls to Google Apps, to be worth about $34 billion.
The market could also receive a boost from the recession, which has slashed corporate travel budgets that are not expected to be completely restored when the economy recovers.
Cisco says it has reduced its own global travel expenditure to about $260 million from $720 million, thanks to its investment in TelePresence as well as cuts it would have made.
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8c6425fb2220d547ca5ad235077440be | https://www.cnbc.com/2009/10/01/corporate-pension-plans-facing-huge-shortfalls-study.html | Corporate Pension Plans Facing Huge Shortfalls: Study | Corporate Pension Plans Facing Huge Shortfalls: Study
Sponsors of defined-benefit pension plans — the main retirement vehicle for millions of Americans — face "significant" pressure in the next year to keep the plans afloat, according to a study by one of the world's largest benefit consulting firms.
Women and RetirementiStockphoto
The study by Mercer LLC, a unit of Marsh & McLennan , says that while pension reform in recent years and market gains this year have helped improve funding levels, they are not enough to make up for the huge losses the plans suffered in the financial crisis last year.
"Looking ahead to 2010 — barring an enormous market recovery," said Mercer Principal Craig Rosenthal in testimony prepared for a House Ways and Means Committee hearing on Thursday, "we expect that many defined benefit plans will face significantly increased required contributions."
That could put pressure on corporate balance sheets, or in some cases force companies to consider suspending or modifying their pension plans.
Mercer surveyed 874 private pension plan sponsors, and found that while many are in a good position to meet their current needs, 21 percent face "significantly higher" required contributions this year — in many cases more than 50 percent higher than last year.
The study found that the 2008 market crash — and changes in pension funding rules — mean firms cannot rely on surpluses from previous years nearly as much as they could in the past.
At the end of 2007, the study said, the plans had an aggregate credit balance of $52 billion. This year, it is as little as $20 billion, and a quarter of the plans surveyed had no credit balances at all.
Also impacting the health of pension plans are low interest rates, and the prospect that they will remain low into next year. The low rates mean plan sponsors must assume lower rates of return on their investments, offsetting gains in the markets.
"While investment returns through August 31, 2009 for most plans should be positive," Rosenthal said in his prepared testimony, "they are far from being sufficient enough to reverse the dramatic investment losses suffered by most plans during 2008."
The House Ways and Means Committee is considering whether to adjust funding requirements for pension plans, making it easier for employers to continue offering the plans. The rules were significantly overhauled by Congress in 2006, with additional adjustments last year.
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00ba1becbe6e12fc99fc56c5ef9011dd | https://www.cnbc.com/2009/10/01/could-this-be-the-future-for-newspapers.html | Could 'This' be the Future for Newspapers? | Could 'This' be the Future for Newspapers?
GannetAP
Everyone's looking for the silver bullet to save the newspaper industry.
This week all eyes are on Gannett; its stock has been flying higher, up more than 500 percent excluding dividends since hitting a low of $1.95 in March. The owner of 84 newspapers including USA Today has managed to beat expectations thanks to dramatic cost cutting and just this week improved guidance for the third quarter, well above Wall Street expectations. But for all that optimism and positive commentary, the company still expects revenue to be down 19 percent for the quarter, thanks to continued weak ad revenue.
So what's a newspaper company to do?
The Washington Post and Los Angeles Times, announced they're breaking up their news service after nearly a half-century. Instead the Los Angeles Times will distribute many of its stories through a news service jointly owned by its parent company, Tribune and McClatchy. The long-running Los Angeles Times/Washington Post deal distributed stories, like a wire service, to about 600 subscribers. To me this says less about a rift between the Post and the Los Angeles Times and more about the Tribune Company, which has been operating under Chapter 11 bankruptcy protection, and is trying to bolster its revenue stream.
Is Twitter Worth $1 Billion?
Sources in the industry tell me that the Tribune is working on aggregating content from the Tribune's top papers that could be widely distributed - say food and travel pieces from the Los Angeles Times, human interest stories and political analysis from the Chicago Tribune. The idea would be to tap into content that was considered "local" but could have a national appeal. Down the line the publishing company could assemble verticals like "lifestyle" and "travel" that would work as targeted news websites with content pulled from all the company's papers.
Disney's Digital Book Gamble
Meanwhile, another new play in the newspaper business is local, which seems odd considering how many regional and city papers have shuttered. The man behind San Diego News Network (SDNN.com), Neil Senturia, a "hyperlocal," news site, is now looking to raise $40 million to create about 40 similar sites for cities around the country. The theory is that local news and lifestyle stories will attract local advertisers. Senturia says he wants to retain ownership of all forty local sites, "like Starbucks," as he said to Forbes.com. But in fact the model hinges on keeping costs way down, by using freelancers instead of full-time employees and a tech platform, built overseas, it can use for each of the sites.
The big problem for Pulitzer Prize-winning papers like Denver's Rocky Mountain News, which folded, was their costly, experienced employee base. But it's also those journalists that made their content appealing enough to attract readers outside Denver and win Pulitzers. But Senturia isn't trying to win any awards; he's going lean and mean and trying to make some money. In a way he's taking a lesson from Gannett's various rounds of cost-cutting, looking to implement an impossibly cheap model from the start.
Questions? Comments? MediaMoney@cnbc.com
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e5dd6933e461e5495badf6dd398b2a02 | https://www.cnbc.com/2009/10/01/cramers-pullback-play.html | Airgas ARG CEO Peter McCausland is seeing green shoots, he told Cramer and Erin Burnett during Thursday’s Stop Trading!.
VIDEO0:0000:00Stop Trading, Listen to Cramer!
The CEO has noticed a “nice pick-up in sales in the last 30 days,” he said. And while other possible green shoots in recent months have flattened out, Airgas remains “cautiously optimistic.”
McCausland did recognize that people can’t seem to decide between the bullish and bearish cases for the market, as auto and metal fab companies call back workers while layoffs continue at the same time.
“We’re sort of just in suspension,” he said.
One indicator that McCausland pointed to was trucking traffic, he said, because it “really moves the US economy.” He’s seen an increase there, which he called “a sign of optimism.”
So what do investors do if the Dow hovers at its present level or heads lower?
“I think that you go to the Cloroxes and Kimberly-Clarks,” Cramer said.
KMB especially offers the international exposure that’s key to taking advantage of the weak dollar, and it benefits from cheaper natural gas. The company also pays out a nice 4.2% dividend yield. That’s why Cramer was surprised almost all sectors have sold off today, even though he thinks Kimberly-Clark is a buy.
“If the market’s predicting a recession,” Cramer said, KMB “should be going higher.”
Call Cramer: 1-800-743-CNBC
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
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83ca2a111781a9e7866ccd946d5d27a1 | https://www.cnbc.com/2009/10/01/earnings-roundup-oct-1.html | Earnings Roundup: Oct. 1 | Earnings Roundup: Oct. 1
What follows is a roundup of corporate earnings reports for Thursday, Oct. 1.
BEFORE THE BELL
Constellation Brands
The alcohol beverage company posted a profit of 45 cents for its second quarter ended Aug. 31. Constellation posted revenue of $876.8 million. Click for Full Story
AFTER THE BELL
Accenture
The managment consulting and outsourcing company posted earnings of 39 cents per share for its fourth quarter ended Aug.31. Accenture reported sales of $5.15 billion.
Q3 Earnings Preview: Top Expectations for Growth
*Earnings data based off of Thomson Reuters
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f96392775ed01d54967c53a7a0bfe24a | https://www.cnbc.com/2009/10/01/exxons-conundrum.html | Exxon's Conundrum | Exxon's Conundrum
If you were a stock holder, would you rather have a buyback, or a dividend?
If you own Exxon Mobil , you probably want the latter.
Slideshow: Which Oil Producers Are Making Money?
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c0de5538e9d08fccb40ef8e7e5d132d4 | https://www.cnbc.com/2009/10/01/funds-try-to-ward-off-new-regulations.html | Funds Try to Ward Off New Regulations | Funds Try to Ward Off New Regulations
Hedge funds, trying to separate themselves from the big Wall Street banks, are stepping up their efforts to head off new regulation from Washington.
Representatives of the industry’s main lobbying group met on Wednesday with the Treasury secretary, Timothy F. Geithner; Ben S. Bernanke, the chairman of the Federal Reserve; and Mary L. Schapiro, chairwoman of the Securities and Exchange Commission, to lay out their views of President Obama’s sweeping package of reforms to the nation’s financial regulatory system.
Of particular interest to the group, the Managed Funds Association, is the possibility that Congress will deem some hedge funds as systemically important to the financial system and subject them to onerous regulation and reporting requirements. The group has been focused for months on persuading lawmakers that, unlike big banks, hedge funds do not pose a systemic risk to the economy.
“As we have made clear, we were not the contributors to these financial problems and, where hedge funds have met their demise, nobody got any taxpayer money to help bail them out,” said Richard H. Baker, the association’s chief executive.
Hedge funds have also been engaged in heading off restrictions on trading credit-default swaps and betting on the decline in a company’s stock price.
As part of its push in Washington, the association is expected to elect Darcy Bradbury, a former assistant Treasury secretary, to lead its effort. Ms. Bradbury, a senior vice president for the D. E. Shaw group, will succeed Eric Vincent, who is credited with turning the once-sleepy organization into a powerful lobbying group.
In her new role, Ms. Bradbury will work closely with Mr. Baker, a former Republican congressman from Louisiana who was hired in February 2008. Since then, the group’s membership has grown by 45 percent to 1,100 members and now represents most of the $1.5 trillion industry.
“The M.F.A. had historically been under resourced and did not have the staff to respond appropriately to the broad range of Congressional inquiries, much less ones from the regulators, the states and the international community,” Mr. Baker said in an interview.
Mr. Vincent, the president and chief operating officer of Ospraie Management, a large hedge fund based in New York, is expected to remain on the board of the association.
“His prescience in pulling together industry leaders and motivating them to get more involved in the legislative process has been a tremendous asset to the entire industry,” Mr. Baker said.
The group’s members are also expected to elect several new directors from big industry players.
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935f9a69ec8268ad0e6a16f5707d0222 | https://www.cnbc.com/2009/10/01/halftime-report-will-fed-support-the-dollar.html | The fourth quarter kicked off Thursday with profit taking as weaker than expected economic data sent the bulls into hiding.
Specifically, September manufacturing data and worse-than-expected jobless claims released before the bell, overshadowed more positive reports on construction spending.However it's the dollar that has captured the attention of our traders this afternoon. Testifying before Congress Fed Chairman Ben Bernanke issued a few comments that made the Street sit up and take notice.
He said, “(Although) I believe there is no immediate risk to the dollar…. I also agree (that) if we don't get our macro house in order that will put the dollar in danger.” Bernanke also said, "We are confident that we can manage our policies to support the economy without inducing inflation in the medium term. We fully believe we have the tools and political will necessary to achieve that."
What must you know to trade this market?
VIDEO0:0000:00Fast Money Halftime Report
Instant Insights with the Fast Money traders
I think the secular trend in the dollar will probably be lower, muses Fast Money trader Joe Terranova. Despite strength today, I’d bet on dollar weakness long-term.
The comments from Bernanake suggest to me that the Fed could take a role in supporting the dollar, counters Brian Kelly of Kanundrum. The dollar was bid higher on Thursday because investors are growing fearful of a weak economy. I think it goes one of two ways. There could be a coordinated global strengthening or a competitive devaluation.
Looking at the broad market... I’m watching the S&P 500 , explains OptionMonster Jon Najarian. It’s dancing at 1038, he says. If we don’t hold this level it’s very bearish.
I’m seeing very aggressive put buying in the bank sector ETF, reveals JJ Kinahan of TD Ameritrade. Many traders believe that when the market weakens, the financials will show the first chink in the armor. And we may be starting to see it now.
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KKR GOES PUBLIC
KKR on Thursday closed a long-awaited deal to buy its Amsterdam-quoted fund, becoming a Euronext-listed company and completing the first step toward an expected move to the New York Stock Exchange.
A move to a New York listing, which would put KKR on the same playing field as Blackstone, will likely come next spring.
What’s the trade?
I think this is a name to watch, says Joe Terranova.
______________________________________________________Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send those e-mails to .Trader disclosure: On October 1, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU): Finerman's Firm Owns (BAC) Preferred Shares, (BAC), (BAC) Call Spreads: Finerman Owns (BAC) Preferred Shares And (BAC): Finerman's Firm And Finerman Own (WFC) Preferred Shares: Finerman's Firm Owns (DRI), (MSFT), (YUM), (BKC): Finerman's Firm Is Short (CAKE), (TLT), (IJR), (IWM), (SPY), (MDY), (USO), (UNG), (TLT): Terranova Owns (XOM) Calls: Terranova Owns March Sugar Futures: Terranova Owns December Crude Oil Futures: Terranova Owns December Gold Futures: Terranova Is Short (GRMN), (ESS), (CCL), (WYNN): Najarian Owns (ACI) Call Spread: Najarian Owns (C) Calls: Najarian Owns (DELL) Call Spread: Najarian Owns (ERTS) Calls: Najarian Owns (GE) Calls: Najarian Owns (MSFT) And Is Short (MSFT) Calls: Najarian Owns (RIMM) Call Spread: Najarian Owns (ORCL): Najarian Owns (TEVA): Najarian Owns (WFC) Put Spread: Najarian Owns (YHOO) Call Spread GE Is The Parent Company Of CNBC For Rich GreenfieldPali Makes A Market In Shares of (CMCSA) Cortes Owns U.S. DollarCortes Is Short (FXI)CNBC.com with wires
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ca865154e51be81a26af8d2aac8b5256 | https://www.cnbc.com/2009/10/01/has-michael-vick-resigned-with-nike.html | Has Michael Vick Re-Signed With Nike? | Has Michael Vick Re-Signed With Nike?
In 2007, Nike terminated Michael Vick's contract after he was indicted on charges of running a dogfighting ring.
On Wednesday, Mike Principe, the managing director of BEST, which represents Vick, announced that Nike was back with Vick. The comments were made at the Relay Sports Symposium in New York -- an event hosted by the SportsBusiness Journal.
On Wednesday night, five hours after the comment was made, a Nike spokesman said that the company would not have any comment on the possible deal with the Philadelphia Eagles backup quarterback at this time.
It is not known how well Vick would be compensated under such a deal, but it likely isn't worth much since the shoe and apparel brand isn't expected to bring any Vick-related products to retail anytime soon.
San Diego Chargers running back LaDainian Tomlinson is the only Nike-endorsed football player that has a signature shoe.
Vick had five signature shoes made for him by Nike, the last one never hit shelves.
Vick has only worn Nike since returning from jail on to the field this year, though his specific choice of shoe has not been steady. Vick has worn at least three different models, including a Tomlinson signature shoe at his first practice back in July.
Exclusive: Favre, Vick at Top Of Jersey List
Despite the controversy surrounding his return, his jersey is currently the fourth best selling jersey in the NFL, according to NFLShop.com
Sports Slideshows On CNBC.com:
The Best Super Bowl Ads of All TimeSuper Bowl Spending Frenzy
Questions? Comments?
SportsBiz@cnbc.com
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ad606a84d50d24072041ccaf94244020 | https://www.cnbc.com/2009/10/01/hirschhorn-dow-10000-who-cares.html | Hirschhorn: Dow 10,000. Who Cares? | Hirschhorn: Dow 10,000. Who Cares?
VIDEO0:0000:00Hirschhorn: Dow 10,000. Who Cares?
Video: Market coach Doug Hirschhorn, PhD, discusses the four reasons why the Dow Jones reaching 10,000 does not really matter.
1. People are desparate While recovering from a year of pain, people are desperate to feel good about something. 10,000 is a nice round number with lots of zeros. That’s it. Don’t waste time reading too much into it because really, in the end, it is just another number.
2. Old rules are just that, old rules We are in a new financial world, with new rules created every day. What used to matter most doesn't matter so much anymore. And that kind of change scares people. So how do you beat that? It’s easy (but not necessarily fun). Simply become a student of the current game and learn new rules.
3. Comfort zone issues It's easier to look back today and embrace what used to make us comfortable in the past. Getting comfortable with a specific way of thinking can lead to three things:
Sloppy tradingComplacencyMissed opportunities to outperform
You want to be successful in trading? Start to get comfortable with being uncomfortable.
4. The Dow is really just a worn down name brand Look, I'm a trading coach to the elite on Wall Street and I don’t have a single client who follows the Dow as a leading indicator. So, why would you? Rather, they look at the S&P, global commodities like oil, natural gas, or gold. They look for those things to tell them which way the market's going to go and how the enrironment is really playing out.
Think better, invest smarter.
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a9360a7f7e12f5dcae93268fe4777ab5 | https://www.cnbc.com/2009/10/01/in-the-job-search-make-your-own-luck.html | In the Job Search, Make Your Own Luck | In the Job Search, Make Your Own Luck
laid off
The situation is a common enough one, and it’s likely playing out at a workplace near you.
For one reason or another, it’s time to (voluntarily) leave your job, but the lack of opportunities out there are, well, underwhelming at best.
Bernanke, wherefore art thou?
You told Americans the recession was likely over, so where are the glut of positions that jobseekers are hungering for?
Tempting as it may be, don’t run screaming out the door of your current workplace quite yet.
Blind Pollyanna-esque hopefulness probably isn’t the way to go, either, but a healthy dose of pragmatism is closer to a solid cure to get you through this uncertain moment in time.
The jobs really are out there, but you need to take a few steps to set yourself apart and snag one.
It’s oft-repeated, but there’s a basis for it: remember that when you’re looking for a job, you’re selling yourself. Sure, simply touting your skill set certainly helps. But having a cover letter that clearly spells out why you’re the person for that particular job is going to help more than the cleanest resume on the planet if HR doesn’t think your cover letter was engaging or interesting enough to warrant a close look at your resume. (Hey, they’re human too.) Be succinct without boring them (and of course, while giving them the information they need to hire you) and you’ll stand out.
Not only should you “sell” yourself, you should be ready to brand yourself (but put that cattle brand away). Snag the domain for your name (i.e. www.janedoe.com) and start building a site that underscores your resume and your specific experience. Show, don’t tell. If you’re a writer, put your published clips on the site. If you’re a designer, show pieces of your work. Along with a short note, email the link to prospective employers (making sure it’s well-designed and cleanly laid-out, of course) so that they don’t have to wade through attachments like they do for other job applicants. Create your own opportunities. An email to friends and contacts within your industry letting them know that you’re looking for new challenges is not only more effective than blindly sending out hundreds of resumes (even well-crafted ones), but it’s also a more discreet way of protecting your personal information as well, especially if you’re looking for a new job while you’re currently still employed. Think outside your usual realm. Rather than sniffing out leads on generalized job boards that are going to inevitably receive hundreds of applications per posting, start thinking more in terms of specific companies for which you’d enjoy working. Research businesses’ contact information and check job postings on their web site. And even if they don’t have any current openings, don’t let that deter you—send in your resume to HR with a note explaining why you’d like to work there. If a position opens in the future that matches your experience, you may just end up at the top of the pile.
Even if the job opportunities aren’t yet beating down your door, there are ways to realistically stopgap your search in the meantime.
And remember—while you wait for the recession tide to officially turn, there’s nothing wrong with blazing your own trail.
More Executive Strategies on CNBC.com:Where To Find A Job NowHottest States For Green JobsExecutive Career Strategies
________________________________Stephanie R. Myers is a staff writer for Vault.com. She possesses a bachelor’s of journalism from the University of Texas and resides in Brooklyn, New York.
Comments? Send them to executivecareers@cnbc.com
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c3eb2308b781e1a5647d12fd6fa4cbe6 | https://www.cnbc.com/2009/10/01/jobless-benefits-extension-hits-snag-in-senate.html | Jobless Benefits Extension Hits Snag in Senate | Jobless Benefits Extension Hits Snag in Senate
A 13-week extension of unemployment benefits in the 27 states with the highest jobless rates is being slowed by some lawmakers upset that their own states would be left out.
Unemployment
Senate leaders had hoped for a quick voice vote endorsing the House-passed bill to ensure a continued flow of funds to more than 1 million workers who are slated to exhaust their benefits by the end of the year.
The bill limits the extension to states where the unemployment rate tops 8.5 percent — leaving out 23 states not hit as hard by the recession.
"Unemployed workers face equally severe challenges no matter what state they live in, and they should be given the support they need," said Sen. Jeanne Shaheen, D-N.H., in urging passage of legislation extending benefits in all 50 states.
Shaheen on Wednesday wrote a letter to Senate leaders, signed by 15 other Democrats and two independents who usually vote with Democrats, saying it was unfair that hundreds of thousands of workers in states with lower rates of unemployment would be excluded under the House plan.
The House bill passed last week by a 331-83 margin, with supporters arguing that the 8.5 percent threshold was needed to hold down costs and that the measure still covered a large majority of the long-term unemployed in danger of losing their benefits.
They said the bill would protect about three-fourths of the 400,000 expected to exhaust benefits in September, and more than a million facing a cutoff of assistance by the end of the year.
The unemployment rate is now 9.7 percent and is expected to climb above 10 percent in the coming months despite signs that the worst of the recession is abating.
About one-third of the 15 million out-of-work Americans have been without a job for six months, a figure that outpaces recent recessions. There are currently about six people looking for every job available.
States offer 26 weeks of benefits, with the average payment about $300 a week. Over the past two years Congress has stepped in several times to extend the length of benefits or help out state unemployment funds. The stimulus act passed last February also added $25 of federal money to weekly benefits.
Also on CNBC.com:
Biggest Welfare StatesHottest States for Green JobsStates with the Highest Unemployment Rate
Rep. Jim McDermott, D-Calif., sponsor of the House bill, said it would cost about $1.4 billion but does not add to the deficit because it raises money from a one-year extension of a federal unemployment tax, costing about $14 an employee per year.
The House bill covers the 27 states, the District of Columbia and Puerto Rico with jobless rates of at least 8.5 percent.
The 23 states that would not be included are Alaska, Arkansas, Colorado, Connecticut, Delaware, Hawaii, Iowa, Kansas, Louisiana, Maryland, Minnesota, Montana, Nebraska, New Hampshire, New Mexico, North Dakota, Oklahoma, South Dakota, Texas, Utah, Vermont, Virginia and Wyoming.
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adb083d514ca9efcec8492f6e032ae84 | https://www.cnbc.com/2009/10/01/lenders-reduce-principal-not-so-fast.html | Lenders Reduce Principal? Not So Fast | Lenders Reduce Principal? Not So Fast
This morning my boss came into my office, wondering why in my reporting yesterday on the Comptroller of the Currency's "Mortgage Metrics Report" (which gives all kinds of data on how many "home retention actions" were taken by banks in Q2), I left out a big jump in principal write-downs. This is when the bank actually reduces the amount of the loan, effectively giving the borrower more equity in a home that may have lost considerable value.
You see there is this big article in the Wall Street Journal this morning titled, "Banks Bite the Bullet on Loans." It cites a chart on P. 23 of the Mortgage Metrics Report that shows a jump in principal write-downs from 3% of modifications to 10% of modifications. The article says, "That's good news for some homeowners, but may portend more write-offs over the next few years for banks and other lenders now wading through hundreds of thousands of applications for loan modifications."
Here's why I didn't report it, and also why I don't regret not reporting it:
There are two types of home retention efforts reported, repayment plans and modifications. Repayment plans help a borrower catch up, and often result in higher monthly payments. Modifications change the terms of the loan and usually result in lower monthly payments. Right now, the government's Home Affordable Modification Program is still in its three-month trial period, so loans being modified under the plan are being lumped in the Repayment bin, despite the fact that it requires lenders to lower monthly payments. When HAMP loans pass their three-month trial, they then become Modifications and will leave the Repayment bin and go into the Modification bin. The report shows that in Q2 Repayment plans rose by 74 percent from the previous quarter and Modifications fell 25 percent. Why? Because all the banks are now doing HAMP.
Slideshow: Where The $200,000+ Crowd Lives
The numbers that the Wall Street Journal reporter is looking at are the Modifications, which are all done by individual bank programs, not using the government's new bailout. That's 142,362 loans out of the total 439,574 home retention actions. In that much smaller subset, yes, principal write-downs went from 3 to 10 percent.
Now, I know you're asking, what about the HAMP program, where lenders could write down principal if they want? Well I called a certain government official about this on background, and here's what he said: Yes, lenders can, although they are never required to, write down principal. But the way HAMP works is through a "waterfall" kind of system: First the lender looks at the loan, capitalizes any past due interest, fees, etc. and starts at the top. 1) reduce interest rate as low as 2 percent, 2) extend the maturity of the loan up to 40 years, 3) take a portion of the principal and defer (not forgive) it as a non-interest-bearing balloon. If that doesn't get to the 31 percent debt-to-income ratio, then the lender can, again only if they want, write down principal.
Rate on the 30-Year Mortgage Is Retesting Its Record Low
But at that point there is also the net present value test to see if the loan is really worth saving, and as home prices now are stabilizing, and investors are buying up foreclosures, it's more than likely that the lender is going to come up with a better value going to foreclosure than writing down principal. The government source tells me that all lenders are now running loans through the HAMP model before doing any of their own modifications.
True, there is no data yet on how many HAMP trial mods have principal write downs, but my guess is very very few.
Questions? Comments? RealtyCheck@cnbc.com
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84a7b0fb1d8c5360b44197d5d1b4ca0c | https://www.cnbc.com/2009/10/01/lenny-dykstra-attorney-at-law.html | Lenny Dykstra, Attorney at Law? | Lenny Dykstra, Attorney at Law?
Rubberball | Getty Images
Tomorrow, Heritage Auctionswill be selling Lenny Dykstra's World Series ring, his trophy, and other items he pawned a few months ago but never reclaimed.
You can already bid online here.
As I earlier reported, the proceeds of the auction will not go to the famous investor and former baseball player. Instead, profits will go to the pawn shop, which tells me it loaned Dykstra $75,000, and, with interest, he owes over $100,000. Pawn shop owner Yossi Dina does not expect to recoup that entire amount. Also, as first reported on this blog, a Japanese TV crew happened to be in the pawn shop the day Dykstra walked in. What timing!
Now I've learned that Lenny Dykstra is representing himself in his Chapter 11 bankruptcy proceedings.
In a form filed with the court, he said that veteran bankruptcy attorney Jon Hayes is no longer his lawyer. In fact, no one is in the case. Did the two have a falling out? Was Dykstra unable to pay? Was there a conflict of interest, as more lawyers join the case (including those representing Dykstra's estranged wife).
Remember When: Dykstra Bankruptcy: Ex-Met Gives His Side of Story
Calls and emails to Hayes were not returned.
Dykstra's whereabouts are hard to determine at the moment, as the Trustee appointed to manage his bankruptcy case has barred Dykstra from entering either of his homes inside the gates at Sherwood Country Club. The smaller mansion, not the one he bought from Wayne Gretzky, is finally for sale. It was highlighted in this week's Los Angeles Times, but the article failed to mention that the home allegedly has a serious mold problem. Fireman's Fund has set aside $500,000 to fix it, but Dykstra and his wife have been fighting over who should sign the checks.
Slideshow: Fallen Stars: Celebrity Foreclosures
Questions? Comments? Funny Stories? Email
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f60328e3c0c956262499be4cccf44896 | https://www.cnbc.com/2009/10/01/lightning-round-citigroup-garmin-celgene-and-more.html | Citigroup : After Citi’s pullback today, Cramer said, this stock’s a buy.
VIDEO0:0000:00Lightning Round
Ann Taylor : A weak end of September has Cramer thinking that retail is “touch and go for the moment,” he said. Sell ANN.
Garmin : Take profits in GRMN, Cramer said.
Geron : Sell GERN, Cramer said. Go with Gilead Sciences or Celgene instead, Cramer said.
Energy Transfer Partners : Cramer is bullish on ETP and its 8.4% dividend yield.
Solutia :Dow Chemical and PPG Industries are better picks, Cramer said.
Cramer's charitable trust owns Gilead Sciences and PPG Industries.
Call Cramer: 1-800-743-CNBC
Questions for Cramer?
Questions, comments, suggestions for the Mad Money website? madcap@cnbc.com
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d55711609da6c219636bb8fef1e676d3 | https://www.cnbc.com/2009/10/01/mr-bernanke-and-the-dollar.html | Mr. Bernanke and the Dollar | Mr. Bernanke and the Dollar
Mr. Bernanke tries to prop up the dollar while running a loose monetary policy; stocks fall.
The dollar rallied as Mr. Bernanke said that the dollar could be at risk if we did not control the budget gap.
Fed, Other Regulators Should Share Oversight: Bernanke
Why? Mr. Bernanke is in a tough spot: he is running a loose fiscal policy but he needs to help out the dollar.
His only attempt to help the dollar is to call for more fiscal discipline and shift the onus onto legislators.
The call for fiscal discipline means higher rates, which is positive for the dollar.
Slideshow: Weirdest Currencies In the World
Of course, more fiscal discipline may be bad for stocks, at least intermediate term, because it implies less government spending, and less stimulus.
Other are trying to prop up the dollar as well. We had comments in Europe from Joaquin Almunia, EU economic and monetary affairs commissioner. He said that he was concerned with Euro appreciation and would be discussing this today and at the G7 meeting over the weekend.
This makes nonfarm payrolls, out tomorrow, even more important than usual. We are looking for a September loss of 180,000 jobs, an improvement over the loss of 216,000 jobs in August.
A very low number of losses-say 100,000-greatly increases the possibility that the Fed will raise rates earlier rather than later.
That could mean that both stocks AND the dollar could rally.
And THAT would be a major change from the third quarter.
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328a9e7b2ade0037b46c38f1f4a2bc6e | https://www.cnbc.com/2009/10/01/off-the-record-w-gasparino-future-of-bofa.html | As Charlie Gasaprino first told you on Fast Money, big changes are coming at Bank of America.
By now you likely know that CEO Ken Lewis has announced plans to step down from his position and retire at the end of the year.
But in all the frenzy what you might have missed was Gasparino's short list for who may fill the top spot. On Wednesday he revealed possible successors include a large number of BofA insiders such as:
Name PositionThomas Montag Head of Global Markets Barbara DeSoer Bank of America Home LoansSallie Krawcheck President of Global WealthBrian Moynihan Head of Consumer and Small Business Banking Joe Price CFO Greg Curl Chief Risk Officer
However on Thursday he started hearing concerns that the 6 people listed above may not all have the chops. Instead the Street started whispering about two other names. They are Bill Boardman, the former #2 at Bank One and Chad Gifford the former CEO of Fleet Financial.
And Gasparino is also hearing that Bob Steel, the former CEO of Wachovia is lobbying for the corner office.
Who’s does Charlie think is most likely to take the top spot? Moynihan, he says.
______________________________________________________Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment but not have it published on our website send those e-mails to .Trader disclosure: On October 1, 2009, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Adami Owns (AGU), (C), (GS), (INTC), (MSFT), (NUE), (BTU): Finerman's Firm Owns (BAC) Preferred Shares, (BAC), (BAC) Call Spreads: Finerman Owns (BAC) Preferred Shares And (BAC): Finerman's Firm And Finerman Own (WFC) Preferred Shares: Finerman's Firm Owns (DRI), (MSFT), (YUM), (BKC): Finerman's Firm Is Short (CAKE), (TLT), (IJR), (IWM), (SPY), (MDY), (USO), (UNG), (TLT): Terranova Owns (XOM) Calls: Terranova Owns March Sugar Futures: Terranova Owns December Crude Oil Futures: Terranova Owns December Gold Futures: Terranova Is Short (GRMN), (ESS), (CCL), (WYNN): Najarian Owns (ACI) Call Spread: Najarian Owns (C) Calls: Najarian Owns (DELL) Call Spread: Najarian Owns (ERTS) Calls: Najarian Owns (GE) Calls: Najarian Owns (MSFT) And Is Short (MSFT) Calls: Najarian Owns (RIMM) Call Spread: Najarian Owns (ORCL): Najarian Owns (TEVA): Najarian Owns (WFC) Put Spread: Najarian Owns (YHOO) Call Spread GE Is The Parent Company Of CNBC For Rich GreenfieldPali Makes A Market In Shares of (CMCSA) Cortes Owns U.S. DollarCortes Is Short (FXI)CNBC.com with wires
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8fbccef0124fdc0456ca6e7c7ff400f6 | https://www.cnbc.com/2009/10/01/polycom-shares-fall-as-cisco-acquires-tandberg.html | Polycom Shares Fall as Cisco Acquires Tandberg | Polycom Shares Fall as Cisco Acquires Tandberg
Polycom shares fell Thursday as Cisco Systems ramped up competition in the video-conferencing market with its $3 billion acquisition of Norway's Tandberg.
Polycom shares had soared as high as $27.96 on Thursday, but then closed Thursday 4.4 percent lower at $25.57.
In a note to investors, Jefferies & Co. analyst William Choi said Cisco's acquisition "makes the competitive environment even more challenging for Polycom." Polycom is the second-largest provider of video-conferencing hardware in the world, based on market share. Tandberg is No. 1.
Choi said Tandberg has "solid" products, strong relationships with its customers and "significant scale."
However, analysts split on the possibility of a takeover of Polycom.
Choi said the Pleasanton, Calif., company has few suitors of its own. Its most-likely suitor, Avaya, just bought a large chunk of Nortel Networks, the network-gear maker selling itself off in Chapter 11 proceedings. Another potential bidder, Hewlett-Packard, is more focused on building its data center business, Choi said.
Given what San Jose, Calif.-based Cisco was willing to pay for Tandberg, Choi raised his price target for Polycom to $25 from $21. He maintained a "Hold" rating.
Morgan Keegan analyst Tavis McCourt called the Cisco deal a "positive" for Polycom shareholders. They "now own the next most obvious buyout candidate in a consolidating industry that larger tech vendors clearly are looking at with more interest," McCourt said. He kept an "Outperform" rating on the company.
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4f2229a9a28330a96282378e2018ba5a | https://www.cnbc.com/2009/10/01/prices-key-for-toy-sellers-with-santa-on-a-budget.html | Prices Key for Toy Sellers with Santa on a Budget | Prices Key for Toy Sellers with Santa on a Budget
Santa's on a budget this year. Toy retailers and makers plan to make the best of it by offering more deals and cut-price versions of more expensive toys that they hope will spur parents to spend even if they're scrimping elsewhere.
Two influential lists of expected hot holiday toys show only one over $100.
Parents shop in the toy aisle at a Target store, Kingston, Massachusetts(AP)
Parents are likely to keep shopping cautiously as they worry about job security, despite an uptick in home values and a rallying stock market.
"Price is more of a driving factor this year than it was before, and we will probably get our shopping done earlier so there are more choices," said Decatur, Ga., resident Ingrid Allstrom Anderson, 32, whose husband's engineering firm has been hurt by the long slowdown in construction.
BMO Capital Markets analyst Gerrick Johnson predicts toy sales will fall 1 percent during the holiday quarter. They were $9.82 billion last year, according to data from research firm NPD Group.
That's a smaller drop than the 5 percent decline from a year ago, but still bad for a quarter when toy retailers make up to 40 percent of their annual sales. Toy makers can make up to half.
"I think its going to be weak, but I don't think its going to be the disaster it was last year," Johnson said. "Parents have a better idea of what their budgets are at this point, so parents will scrimp elsewhere, not on kids."
One bright spot comes from an unlikely place: a small manufacturer's toy hamster that retails for $8 to $10 and could be the first true "must-have" toy — that is, a toy that sells out, is hard to find and appeals to both boys and girls — since Mattel's Fisher Price TMX Elmo in 2006.
Cepia Zhu Zhu Pet Hamsters squeak and moves around, and they've been impossible to keep on shelves, Toys R Us and Wal-mart Stores say.
Laura Phillips, Wal-mart vice president of toys, says the furor over the hamsters is similar to the craze she saw for the furry robot Furby in 1998 and the electronic pet Tamagotchi in 1997.
"As soon as we're getting them in, they're literally selling from boxes. It's hard to get them on shelves," Phillips said.
Retailers certainly see the toy business as full of potential this holiday.
Walmart is expanding a $10 toy promotion to 100 items, up from 10 last year. Toys R Us is opening 350 temporary stores in malls and inside Babies R Us stores in an effort to gain market share since the demise last year of KBToys, which was the largest mall-based toy seller. Sears has also jumped into the fray with toy aisles in 20 locations.
"It's the year of competing for the consumers dollar," said Laurie Schacht, president of The Toy Insider, a trade publication that puts together a list of toys expected to be hot for the holidays. None in its top 20 are over $100 this year. Last year there were several, including a interactive plush golden retriever.
Top toys for the season likely will be ones that "drive innovation through creativity, not necessarily technology," said Jim Silver, an analyst at Timetoplaymag.com, which put out its annual "Most Wanted" list Thursday. The only item on the list that tops $100 is the "The Beatles: Rock Band" video game, which costs up to $249.
Examples of that on the list includes Hasbro's Candy Land Sweet Celebration Game, which retails for $29.99 and allows players to change the lengths of paths to make the game last longer or shorter.
Board games are expected to be strong, Silver said, because "you can play them over and over" and they're inexpensive. Construction sets from Legos and Mega Brands are also likely to get a boost.
Slideshow: Hot Holiday Toys from Toys R Us
Sensitive to parent's tight budgets, name-brand toy makers are targeting a variety of price ranges. For example, a Dora's Explorer Girls dolls that link to the Web retails for $59.99, there's a non-Web-enabled $19.99 version. Both are on the timetoplaymag.com's list.
Some shoppers are becoming more practical about their picks—and not everybody's thinking toys.
"The recession has made me think more about what my kids and other kids I buy for need — need vs. necessity," said Rebecca Sullivan, 37, a public relations consultant in Westwood, Mass., with a 6-year-old daughter and 3-year-old son. "I am thinking more about educational toys, items for creative play like art supplies or something they can use for longer than a few weeks."
She's planning to buy her daughter a suitcase so she can pack her own clothes for trips, and a watch for her son to help him tell time.
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3f2cb8306485398b4c59f5e360e3aff4 | https://www.cnbc.com/2009/10/01/schork-oil-outlook-diesel-prices-are-key.html | Schork Oil Outlook: Diesel Prices Are Key | Schork Oil Outlook: Diesel Prices Are Key
On Monday and again in yesterday’s issue of , we expressed our concern regarding the relatively low levels of overall stocks of transportation fuels (on-highway diesel and gasoline) on the West Coast (PADD V).
That concern was amplified, first, by an apparent uptick in intermodal transport demand; vis-à-vis a 14% jump in activity at the Port of Long Beach in August; and then by the fire last Friday at Tesoro’s Wilmington refinery near Los Angeles.
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Specifically, while the flattening of the NYMEX WTI contango has led to most of the country swimming in products, the West Coast market remains tight. According to the latest data from Long Beach, container or TEUs (Twenty-foot Equivalent Unit) traffic year-to-date is down around 25%.
However, as we just noted, August TEUs jumped 14%. The Long Beach port handles approximately 13% of all the TEUs that pass through U.S. ports. Our specific fear is that increased intermodal transport demand up-and-down the PADD V coast, against a backdrop of low gasoline and diesel stocks, creates a potential bullish template.
The first half of 2009 saw 388,846 TEUs at Long Beach; a full 22% lower than the 03-07 timestep and 27.4% lower than 2008. The expectation is that total containers are positively correlated with the stocks of distillate fuels in the West Coast.
Indeed, that was true over the 03-07 timestep, which had a correlation coefficient of 0.494, i.e. half of the distillate stock movements could be explained by examining the total containers. However, that relationship has begun to break down, in 2008 it was a negative 0.444 and 2009 to date has seen a correlation of negative 0.668. A complete turnaround in correlation is quite surprising, and hard to ignore.
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For instance, total containers at Long Beach are up over 55% since January, due in part to a spike in Augusts’ numbers. However, stocks are down by 11.4%. What gives?
The answer could come from diesel prices, which have seen an increased correlation with both containers and stocks. For instance, correlation between diesel prices and stocks is a strong negative 0.78, almost double the negative 0.31 value for 2008, i.e. low stocks cause high prices as expected. Similarly, the correlation between prices and total containers is 0.76, up from 0.58 in 2008. That means that as the price goes up, the number of containers increases but stocks decrease.
Slideshow: Top Ten Gas-Sipping Cars
The bottom line, until the correlation between stocks and containers returns to a positive value, TEU traffic at Long Beach is not a suitable indicator. With all of that said, the DOE reported sizeable gains across the Board last week in PADD V.
Read what other CNBC Contributors are saying...
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Stephen Schork is the Editor of, and has more than 17 years experience in physical commodity and derivatives trading, risk systems modeling and structured commodity finance.
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f4ee2eb930de860c9383ec44e5a0f491 | https://www.cnbc.com/2009/10/01/sen-baucus-hopes-to-wrap-health-bill-on-thursday.html | Sen. Baucus Hopes to Wrap Health Bill on Thursday | Sen. Baucus Hopes to Wrap Health Bill on Thursday
The chairman of the Senate Finance Committee said Thursday he wanted to complete work on a sweeping health care bill by nightfall, opening the way for Democratic leaders to bring the historic legislation to the floors of both the House and Senate as early as mid-October.
AP
"I have high hopes of finishing today," Chairman Max Baucus, D-Mont., said as he gaveled open the committee's seventh day of work on legislation embracing President Barack Obama's call for greater protections for those who have unreliable insurance or no coverage at all.
Baucus said his plans "might mean we go late tonight ... quite late." The committee has been meeting well into the evening most nights this week and last.
Finance is the only one of five committees in Congress that has yet to complete work on a health overhaul bill. Once it finishes, Senate leaders can work to finalize a package to bring to the Senate floor.
Senate Majority Leader Harry Reid, D-Nev., said Wednesday the Senate debate could begin the week of Columbus Day, Oct. 12, even though lawmakers are scheduled to be on vacation at the time.
Democratic aides said the House was working on roughly the same timetable, although after months of missed deadlines, neither House Speaker Nancy Pelosi nor Reid would provide a detailed schedule.
Debate in the Senate could take weeks, compared with mere days in the House.
But even now, two weeks before the projected start of debate, key decisions are yet to be made about elements of the bills.
Reid must decide, for example, whether to include an option for the government to sell insurance in competition with private industry, a provision sought by liberals who argue it would subject private insurers to much-needed competition.
Legislation that cleared the Senate Health, Education, Labor and Pensions Committee earlier in the year includes the so-called public option, but the Senate Finance Committee twice rejected proposals along those lines this week.
There is no such uncertainty in the House, where Pelosi has said it will be included in legislation that goes to the floor.
And even at this late date, Democrats in both houses are struggling to find ways to hold down the cost of the overhaul legislation while assuring quality health coverage for millions of lower-income individuals and families.
In the House, the issue has been the subject of closed—door negotiations in recent days, as Democratic leaders try to reduce the cost of their bill to the $900 billion over 10 years set by Obama.
In the Senate, Finance Committee Democrats worked privately on the same issue.
One proposal under consideration, according to senators and aides, was advanced by Sen. Maria Cantwell, D-Wash., and was modeled on a system in her home state that advocates say has achieved significant cost savings.
Federal subsidies ticketed for lower-income uninsured would flow to the states. The states, in turn, would negotiate with private insurers to provide coverage for the target population. Aides said the proposal would be designed to provide coverage for about three-quarters of the nation's uninsured.
Democrats have a 13-10 majority on the committee.
On Wednesday, as Obama lobbied reluctant Democrats by phone to support the Finance Committee measure, Baucus expressed confidence it would have enough votes to clear the committee when it comes to a vote.
"It's clear to me we're going to get it passed," Baucus said, although he sidestepped a question about possible Republican support.
Olympia Snowe of Maine is the only GOP senator whose vote is in doubt, and she has yet to tip her hand. While she has voted with Democrats on some key tests — to allow the government to dictate the types of coverage that must be included in insurance policies, for example —she has also sided with fellow Republicans on other contentious issues.
Republicans tried repeatedly Wednesday to force changes in the bill relating to taxes, abortion and illegal immigrants, but were turned back nearly every time on votes that fell largely along party lines.
By contrast, Sen. Bill Nelson, D-Fla., was successful in winning a change to shield seniors from the impact of a tax increase in the bill for individuals and families seeking to exclude certain medical expenses from their income. Under current law, taxpayers who itemize their deductions are permitted to escape taxes on health costs that exceed 7.5 percent of their adjusted gross income.
Baucus' legislation would raise the threshold to 10 percent, but on a vote of 14-9, Nelson succeeded in returning it to 7.5 percent for taxpayers age 65 and over.
Moments later, Sen. Jon Kyl of Arizona sought to give younger taxpayers the same break, but his proposal failed, also on a vote of 14-9.
One bipartisan amendment also cleared.
Backed by Sen. John Ensign, R-Nev., and Tom Carper, D-Del., it would allow discounts and reductions in insurance premiums for individuals who enroll in voluntary wellness programs designed to reduce their health care costs.
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cd163416223c842ec7abece5240ae2e8 | https://www.cnbc.com/2009/10/01/solar-panel-tariff-may-further-strain-uschina-trade.html | Solar Panel Tariff May Further Strain U.S.-China Trade | Solar Panel Tariff May Further Strain U.S.-China Trade
Companies that import solar panels to the United States are facing up to $70 million in unexpected tariffs.
The bill comes at a time when the industry is already struggling and could hurt both foreign solar panel makers and foreign and American distributors.
Solar panels are shown with the Frog's Leap winery in the background in Rutherford, Calif., Tuesday, Sept. 18, 2007. San Francisco-based Sunlight Electric has helped more than a dozen wineries, including Frog's Leap, to go solar. The company estimates there are 28 systems in Napa County and another 14 in next-door Sonoma County. (AP Photo/Eric Risberg)Eric Risberg
It could also further strain trade relations between the United States and China.
The issue began with a short letter to United States customs officials last December from the small American subsidiary of a Spanish energy company. The subsidiary, GES USA, wanted to know what the tariff would be to import certain solar panels from China.
On Jan. 9, the customs agency wrote back that the panels had become too sophisticated to qualify for duty-free import. Instead — because the panels contain a basic electronic device for safety and energy efficiency — they would be treated as electric generators, subject to a duty of 2.5 percent.
Such low duties are standard on many imports, and are much less punishing than the punitive tariffs aimed at restricting the trade of a certain good, like the 35 percent tariff on Chinese tires announced three weeks ago.
But the duties come at a particularly difficult time for the global solar power industry. Many panel manufacturers are losing money because of fierce competition from ever-expanding production in China and a worldwide downturn that has driven down prices. Raising prices now to cover past tariffs will be hard because the market is glutted with panels; prices have fallen a fifth since early this year.
The decision is legally binding on most solar panels imported into the United States. But virtually no one in the industry became aware of it until the last few weeks, Meanwhile, unpaid duties piled up, along with penalties that are likely to double the cost.
The United States exported almost as much solar panel equipment as it imported in the first seven months of this year — $605 million in imports and $555 million in exports, according to Commerce Department data.
The Solar Energy Industries Association, a coalition of domestic and foreign companies whose board chairman is an executive from Suntech, China’s biggest solar panel maker, argues that American tariffs on solar panels could lead other countries to impose tariffs on American exports.
The customs decision is dividing the industry between importers and companies that produce solar equipment in the United States. And with China accounting for a rising share of American imports, the tariff could become a sticking point in bilateral trade relations already troubled by the dispute over tires, autos and chicken parts.
Some Chinese solar panel manufacturers are already planning to move final assembly of solar modules to plants in the United States, a step that could allow them to avoid the duty someday, said Rhone Resch, the chief executive and president of the industry association.
The duty generally applies to solar panels that provide power to a residential, commercial or industrial electrical system; small solar panels imported with built-in light bulbs are already counted as electric lights and are subject to a tariff of 3.9 percent.
Lawyers are critical of the industry for not spotting the problem sooner.
“It is somewhat unusual for an industry to take as long as eight months to become aware of a customs ruling that affects it,” said Mel Schwechter, a partner at Dewey & Leboeuf in Washington and a former president of the Customs and International Trade Bar Association.
Customs decisions, even for a single importer, are made public on the agency’s Web site and on commercial Web sites, said Mr. Schwechter, who is not advising any of the participants in the dispute.
Mr. Resch said the growing industry lacked the resources to constantly track tax and regulatory decisions.
Duties will be doubled if customs officials determine that companies have been negligent in not paying them earlier.
Importers might also be liable for duties on all solar panels brought into the United States in the five years before the ruling if customs officials decide that the companies were guilty of “material misstatement or omission” for failing to notice sooner that solar panels had evolved to the point that they no longer met duty-free rules.
The association plans to challenge the classification of the panels as generators in court, Mr. Resch said.
But before starting what could be lengthy litigation, the safest strategy for each importer, according to trade lawyers, is to pay immediately the duties and accrued penalties for shipments received since January, and to start paying the duty going forward.
“We’re taking this very seriously — it has a large financial impact in the United States and it has global ramifications,” Mr. Resch said.
Top officials at Customs and Border Protection, the agency that succeeded the Customs Service, could overrule the technical specialists who determined that the sophisticated panels should be treated like electric generators. Such a move would extend duty-free treatment to the latest solar panels. But that would mainly benefit Chinese producers, whose share of the market has surged in the last two years.
It would also reduce the incentive for companies to manufacture panels in the United States — a politically touchy decision at a time when American cities have been vying for panel factories even as the industry is shifting production to China.
Importers, a mixture of foreign and American manufacturers and distributors, are liable for duties and penalties, not consumers who bought imported panels in recent years.
Imports account for almost half of the solar panels sold in the United States.
Customs issued its ruling on Jan. 9, less than two weeks before President Obama took office. The ruling said that a panel from Trina Solar of China was really a generator because it was equipped with a diode that allows electric current to pass around areas of the panel that are shaded. The diodes have become standard on solar panels, and are effectively required to meet American safety standards.
Javier Muniz, the chief executive of GES USA, said through a spokeswoman that GES solicited the customs opinion last winter for a project that did not end up being built. GES did not tell other companies about the ruling, he added.
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Even Trina Solar, the Chinese panel maker, became aware of the decision only “in recent weeks,” a Trina spokesman said. Industry leaders have stayed very quiet about the customs decision in the last few weeks while holding emergency meetings to decide on a legal strategy.
Unlike many large overseas manufacturers, Trina still exports directly from China to independent distributors in the United States. Trina does not have a American subsidiary to import the panels and handle the customs paperwork.
“Trina Solar is currently classified as an exporter and is not liable for the duty arising from these regulations,” said Terry Wang, the company’s chief financial officer.
Suntech said that it was aware of the customs decision and was looking into it.
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Mr. Resch estimated that the duty would cost the industry $70 million this year, and there would be more tariffs in the years to come.
That calculation assumes the industry will be found negligent for not paying the duty on panels imported since January and will be assessed the doubled duty. It assumes the industry will not be found liable for shipments in the preceding five years.
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b6da09c4163c3c53fdf41076d90f7102 | https://www.cnbc.com/2009/10/01/swine-flu-might-overwhelm-hospitals-in-15-states.html | Swine Flu Might Overwhelm Hospitals in 15 States | Swine Flu Might Overwhelm Hospitals in 15 States
If a third of people wind up catching swine flu, 15 states could run out of hospital beds around the time the outbreak peaks, a new report warns Thursday.
People wearing surgical masks to prevent swine fluAP
The nonprofit Trust for America's Health estimates the number of people hospitalized could range from a high of 168,000 in California to just under 2,500 in Wyoming.
The public health advocacy group used government flu computer models to study how quickly hospitals would fill up during a mild pandemic, like the kind the swine flu -- what doctors prefer to call the 2009 H1N1 strain -- is shaping up to be.
It based its estimates on the mild 1968 pandemic, suggesting up to 35 percent of the population could fall ill.
Even though only a fraction would be sick enough to be hospitalized, health officials are bracing: When H1N1 first appeared in the spring, more than 44,000 people visited emergency rooms in hard-hit New York City, the report noted. Just sorting out which patients are sick enough to be admitted from the vast majority who need to go home is a big job. And hospital capacity varies widely.
By the outbreak's peak, the new report suggests Delaware and Connecticut hospitals would fill up soonest. Also on that list: Arizona, California, Hawaii, Maryland, Massachusetts, Nevada, New Jersey, New York, Oregon, Rhode Island, Vermont, Virginia and Washington.
To deal with overcrowding from emergencies, hospitals are supposed to have "surge" plans -- when they would postpone elective surgeries to free up beds, for instance, and when they might even need to call in government help for mobile hospital units.
Those are among the options in New Jersey hospitals' surge plans, as well as doubling-up single rooms and even using nursing-home beds as necessary, says the state health department, which deems its hospitals ready to meet the challenge.
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764ab22227e4ec34df0a78c9af82cb1f | https://www.cnbc.com/2009/10/01/the-nbas-bestselling-jerseys-in-europe.html | The NBA's Best-Selling Jerseys In Europe | The NBA's Best-Selling Jerseys In Europe
For the second straight year, the jersey of Los Angeles Lakers guard Kobe Bryant is the best-selling jersey in Europe, according to a list released by the NBA and gathered by surveying retail locations in Europe for the 2008-09 season.
Watch my exclusive interview with Kobe Bryant
Bryant's No. 24 is followed by the jerseys of Kevin Garnett, Pau Gasol and LeBron James.
Basketball Jerseys
Dwight Howard's postseason run made him top of mind across the Atlantic. The Orlando Magic star debuts on the European jersey list at No. 7.
Besides Gasol, it comes as no surprise that there are seven other European players featured in the top 15 best-selling jerseys, including Tony Parker (No. 6), Dirk Nowitzki (No. 11) and Joakim Noah (No. 14), who grew up in the United States, but is listed by the NBA as an international player. His father is French tennis great Yannick Noah.
Noah's Bulls play the Utah Jazz on Oct. 6 in London as part of NBA Europe Live presented by EA Sports.
NBA products are sold in more than 16,000 retail locations in Europe. International sales account for 30 percent of the league’s overall global merchandise business.
Here is the complete list of the 15 best-selling jerseys in Europe:
1. Kobe Bryant, Los Angeles Lakers 2. Kevin Garnett, Boston Celtics 3. Pau Gasol, Los Angeles Lakers 4. LeBron James, Cleveland Cavaliers 5. Dwyane Wade, Miami Heat 6. Tony Parker, San Antonio Spurs 7. Dwight Howard, Orlando Magic 8. Andrea Bargnani, Toronto Raptors 9. Jose Calderon, Toronto Raptors 10. Paul Pierce, Boston Celtics 11. Dirk Nowitzki, Dallas Mavericks 12. Rudy Fernandez, Portland Trailblazers 13. Marco Belinelli, Golden State Warriors 14. Joakim Noah, Chicago Bulls 15. Gilbert Arenas, Washington Wizards
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Questions? Comments? SportsBiz@cnbc.com
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3a984b5a970d47a97ea76259ad22493d | https://www.cnbc.com/2009/10/01/top-selling-sports-books-of-2009.html | Top Selling Sports Books Of 2009 | Top Selling Sports Books Of 2009
There's usually plenty of buzz when a big sports book comes out, but it's rare that we ever follow up and find out how that book did.
Here's a list of the top sports books with year-to-date sales, according to Nielsen Bookscan. This data is through Sept. 27 and does not include sales from Wal-Mart, Sam's , BJ's or libraries. Thanks to Kathy Connors, principal and founder of KMC Consulting, for this idea.
The Yankee YearsThe Yankee Years
Top 10 Sports Biographies
1. "The Yankee Years," by Joe Torre and Tom Verducci - 320,000 copies sold
2. "Red and Me: My Coach, My Lifelong Friend" by Bill Russell and Alan Steinberg - 30,000 copies sold
3. "Satchel: The Life and Times of an American Legend" by Larry Tye - 28,000 copies sold
4. "It's Not About The Bike: My Journey Back To Life" by Lance Armstrong and Sally Jenkins -26,000 copies sold
5. "A-Rod: The Many Lives of Alex Rodriguez" by Selena Roberts - 21,000 copies sold
6. "Lance: The Making of the World's Greatest Champion" by John Wilcockson - 15,000 copies sold
7. "Munson: The Life and Death of a Yankee Captain" by Marty Appel - 14,000 copies sold
8. "Shooting Stars" by LeBron James and Buzz Bissinger - 13,000 copies sold
9. "Yogi Berra: Eternal Yankee" by Allen Barra - 13,000 copies sold
10. "Always by My Side: The Healing Gift of a Father's Love" by Jim Nantz - 11,000 copies sold
There are a lot of interesting stories in these numbers. On the surface, it looks like if you want to write a best-selling sports biography, odds are you should do something about the Yankees.
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Four out of 10 of the top 10 books here are about the Yankees. Everything is relative, of course. "The Yankee Years" impressively blew away every book in the category. And while Selena Roberts' "A-Rod" book is currently in fifth place on the year with 21,000 copies sold, it will be considered a disappointment because Harper Collins' announced first printing was 150,000 copies.
Although much of the early attention on "The Yankee Years" focused on Torre's "A-Fraud" comments, the book written by the current Los Angeles Dodgers and former Yankees skipper with SI's Tom Verducci was critically acclaimed.
"There are a lot of sports books that get excerpted and don't sell well because it's not about the steak, it's about the sizzle," Verducci told me. "The support for this book spread through word of mouth, through people who realized this wasn't just a Yankees book, it was a book about the game. It's about why they won and why they didn't win in the context of what was happening in baseball during those years."
Verducci said that he thinks that, given the current immediacy of news, there's still solid market for in-depth books.
"I'm not sure those quick turnaround books with the World Series or Super Bowl MVP exist anymore, but there's still a lot of room for the longer form analysis."
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The fact that Lance Armstrong's book, written in 2001, is still on this list is remarkable, and it looks like LeBron James' new book - which is coupled with the release of the movie on his high school team - will move up the charts by year end. The book has sold 13,000 copies in 27 days.
Born To RunBorn To Run
Top 10 Sports & Recreation Books
1. "Born to Run: A Hidden Tribe, Superathletes, and the Greatest Race the World Has Never Seen," by Christopher McDougall - 78,000 copies sold
2. "Strength Training Anatomy, 2nd Edition," by Frederic Delavier - 54,000 copies sold
3. "The Match: The Day the Game of Golf Changed Forever," by Mark Frost - 34,000 copies sold
4. "Got Fight?: The 50 Zen Principles of Hand-to-Face Combat," by Forrest Griffin - 34,000 copies sold
5. "WWE Encyclopedia," by Brian Shields - 32,000 copies sold
6. "The Downhill Lie: A Hacker's Return to a Ruinous Sport," by Carl Hiaasen - 31,000 copies sold
7. "Deep Survival: Who Lives, Who Dies, and Why," by Laurence Gonzales - 28,000 copies sold
8. "Are You Kidding Me?: The Story of Rocco Mediate's Extraordinary Battle with Tiger Woods at the US Open," by Rocco Mediate and John Feinstein - 25,000 copies sold
9. "The Blind Side: Evolution of a Game," by Michael Lewis - 25,000 copies sold
10. "Moneyball: The Art of Winning an Unfair Game" by Michael Lewis - 24,000 copies sold
Just as the success of "The Yankee Years" wasn't a surprise to me, either was "Born To Run," which I called the "best book I ever read" in May. John Feinstein obviously has a great record, but the fact that the Mediate book sold better than the A-Rod book is quite an accomplishment. And how about Michael Lewis? More than six years after "Moneyball" came out, it's still flying off the shelves.
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Questions? Comments? SportsBiz@cnbc.com
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