In volatile markets, oil slips in early trading (AP)
So... that whole Saudi oil production announcement had basically no effect. After trading $140 yesterday, the price of the stuff has now eased to somewhere around $133. Wasn't this announcement supposed to kneecap all the speculators? As for the crazy action, said one analyst: "(A) price swing of $5 per barrel isn't unusual anymore." True, but then it's also not as big of a move as it used to be.
Blunt asks FTC to look at InBev's bid for AB (KWMU)
The governor of Missourri has joined the fight opposing the sale of Anheuser-Busch to InBev. It's pretty silly right. Said Governor Blunt: "I don't talk to many people anywhere in Missouri who wants to see Anheuser-Busch sold to a Belgian company that most of us have never heard of and see headquarters jobs leech out of the beautiful city of St. Louis and see a lot of aggressive cost-cutting that would hurt all of the distributors in every county across the state." As ridiculous as he sounds, there is an upside.. by attacking a Belgian company so vociferously, it gives politicians cover next time they attack a Middle Eastern sovereign fund, on the ground that their protectionism is not just about the Middle East.
Disney Revs Up Tween Star Machine (WSJ)
A couple months ago, Portfolio had a pretty solid story about Disney's tween star strategy, which has been so successful for the company. Miley Cyrus is the big one. Big that article ended on an almost eerie note, wondering when the Cyrus brand would be damaged by her loss of innocence (with days), and what they'd do to replace her. Anyway, WSJ takes a look at the pipeline, and apparently there's someone called Demi Lovato, a 15-year old from Texas completing an album due to hit this Fall. Hopefully it will pass the key trials and get regulatory approval and be able to hit the market smoothly.
A Different Romney Enters Private Equity (peHUB)
We can't remember specifically which of the 5 brothers Tagg was... he might've been the one with the really good jawline. All we know is he wasn't Ben, who, if we recall, was the one that had a beard and didn't look like a Republican. Was there a Mitt Jr.? Anyway, Tagg is joining the world of private equity as a co-founding principal of Solamere Capital. It's trying to raise $200 million.
Mets Fire Randolph Overnight (ESPN)
For you Mets fans out there... while you were sleeping, Willie Randolph was fired. That was always in the if, not when category, though doing it at 3:15 AM is always an unusual move.
AIG's new CEO gets his big break in tough climate (AP)
This was said yesterday, but we have to ask. Did the new CEO of AIG really say that there'd be "no sacred cows?" Is there anything more cliche to say for an incoming CEO at a troubled firm. And is there anything less inspiring, rhetoric-wise? Surely he was misheard.
Latest Honda Runs on Hydrogen, Not Petroleum (NYT)
Back in 2000, we were at the Geneva Auto Show and some engineers from BMW showed off a car running purely in hydrogen. It seemed cool cause it was based on combustion, not a fuel cell, and so it was claimed that the car had better pickup and acceleration than a fuel cell. Anyway, fast foward, and Honda is getting ready to roll off a new hydrogen vehicle off the assembly line. Of course, good luck filling one up anywhere (for the next 25 years). Oh and they only plan to build 200 over the next three years, so get in line No doubt Governer Schwarzenegger has first dibs.
Daimler Announces EU6 Billion Share Buyback Program (Bloomberg)
Why is it that when a company doing badly announces a huge buyback program it always comes off looking desperate? Oh, probably cause it is.
Posted by american bandersnatch , Jun 17, 2008 7:19AM
Why is it silly for the governor of Missourri to be opposed to the merger? He's looking out for his state and while the merger may create worldwide efficiencies, the loss of jobs in Missourri will hurt his state.
Posted by TheUnrepentantGunner , Jun 17, 2008 7:32AM
Just wanted to point out to all you bitches that I called mediate against a mass of people with 1 and a half strokes.
Anal_yst, way to wuss out, you saved yourself $10.
Posted by big r , Jun 17, 2008 7:47AM
bye bye willie
Posted by dd , Jun 17, 2008 8:25AM
nothing on the goldman siv?
Posted by StMarc , Jun 17, 2008 8:38AM
You wanna talk desperate, look at that thing Chrysler is doing with the guaranteed $2.99/gal gas with the sale of a new car. (Daimler's exposed to that, too, although not that bad - they still own ~20% of Chrysler IIRC.) They don't make any money ANYWAY, and they're going to hedge gas for all their customers for three freaking years?
To me, that means that either they (Chrysler, not Daimler) expect to declare bankruptcy within the next year or so, or they have secret information that the price of oil is going to drop 50%. I'm not bettin' on that last one. Though I've been wrong before, and that would be a nice thing to be wrong about.
M
Posted by HAM05 , Jun 17, 2008 8:58AM
@8:38 i had this same argument with my dumbass roomate but i will paraphrase again...
chrystler guaranteeing 2.99/gal is just another discount that they bake into the price of a car. they cap this at 12k mi a year for 3 years so assuming the price of gas goes up to $6/gal and a car gets 20mi/gal they end up having to shell out $5400 - taking into account the markup, doesnt make that big of a diff when youre dealing with a 30k car that they would otherwise rebate the shit out of anyway.
Posted by AJ , Jun 17, 2008 9:12AM
Following up on HAM's point, the gas deal is also conditional in that in order to maximize the amount of subsidized gas you get, you must drive 12,000 miles. A significant number of people will likely drive less (the people that drive more don't matter). So for your car with a $20k base price you pick either something like $3k cash back where you lower your price to $17k immediately or you pay $20k and get the gas card. Assuming $5 flat per gallon, if you max out, you'd save $3,600 over 3 years. Discount that back to today, and Chrysler comes out ahead. Also, since some people will drive less, Chrysler probably comes out ahead as long as gas doesn't go to $20 per gallon.
Posted by guest , Jun 17, 2008 9:14AM
My "Crashler" has a Rolls - Knardley engine in it. Rolls down hills and knardley get up the other side.
Posted by Bugs Meany , Jun 17, 2008 9:16AM
How does one get on the career path toward Senior VP of Jailbait Development over at DIS?
Posted by guest , Jun 17, 2008 9:18AM
Here's what the first year an analysts at Bear were rolling in....
http://www.youtube.com/watch?v=lQdsv4JFPe8
Posted by Anal_yst , Jun 17, 2008 9:29AM
@ M, Ham, etc
My initial analysis of the Chrysler Guaranteed gas program suggested costs in the hundreds of millions, but they announced after the first month that only a few thousand had opted for the program (as opposed to the tens of thousands I'd estimated), thus the costs are much lower. Also have to wonder how many of those sales were incremental, kinda hard to know though. Oh, and I did wuss out v. gunner. W/e
Posted by guest , Jun 17, 2008 9:30AM
Last year, Repub US Sen. Grassley aggressively took on televangelists over their private jets, questionable tax status and lavish spending. Now Iowa is on the receiving end of a "great flood". Hmmmmmmmm........
Posted by guest , Jun 17, 2008 9:32AM
How about nothing on the WSJ article regarding how difficult things are getting for hedge fund managers, especially newer ones?
Posted by guest , Jun 17, 2008 9:34AM
Disney should form a partnership with Penthouse. That way their tween stars can have a clear career path laid out for them.
Posted by guest , Jun 17, 2008 9:53AM
gunner, true and your -1.5 is really terrible odds versus the true line, well done but still a sucker bet
Posted by StMarc , Jun 18, 2008 2:10PM
I didn't realize that taking the gas guarantee nixed *both* rebates and ultra-low rate programs. Now that I know that, I admit that it's not any dumber than anything else the auto industry does. My bad.
M