It is well known that smart people—particularly the subset of the intelligent sometimes called intellectuals—tend to overrate the role of intelligence in providing solutions to social problems. This was on display in lurid colors in Gretchen Morgenson’s Sunday column in the New York Times lamenting the lack of “an intelligent and comprehensive plan for dealing with mass foreclosures and the economic consequences associated with the [credit crash] debacle.”

Morgenson goes to great lengths to draw comparisons to New York City’s bankruptcy crisis in the midseventies—which, as she says, was avoided in part by a cabal of government officials and bankers conspiring to refinance the city’s teetering debt structure. But she goes too far in reading a greater lesson into this story. It becomes almost a fairy tale of intellectualism, in which well intentioned intellectuals swoop in from their glass and steel perches to rescue capitalism from its tendency toward anarchy. The idea that no rescue plan outside of permitting market processes to operate is available is reduced to “doing nothing.” A better way must be available because “America is full of smart and caring people!”

We’re second to no one in our appreciation of the smart and caring—we’re not supposed to call them the “best and the brightest” anymore—Inhabiting these Untied States. Unfortunately, we have stubborn memories that insist on recalling the fact that the mortgage crisis that set off the broader credit crisis has its origins in the plans of the smart and caring to expand homeownership beyond the levels established through market processes. Perhaps its time to give “doing nothing” a chance.

Big Rescues Can Work. Just Ask New York. [New York Times]

Wall Street Journal reporters are in mourning today after the Bancroft family sold their souls to the News Corp Murdochracy for $5bn. “It’s sad. We held a wake. We stood around a pile of Journals and drank whiskey,” one writer said.

The Journal’s Managing editor, Marcus Brauchli (whose job, it should be noted, was secured during those interminable negotiations for “editorial independence”) tried to cheer up the troops this morning, sending around an internal memo with such heartrending reassurances as, “Our journalism defines the Journal,” and “It is too early to know how or even whether News Corp. ownership might alter priorities or structures at Dow Jones.”

For the time being, he’s probably right.

It’s finally pretty much almost over. Rupert Murdoch has secured enough Bancroft family shareholder votes to move forward with his $60-a-share, $5bn bid, one future News Corp holding reports.

One day after a Murdoch spokesperson said the deal was “highly unlikely,” the Denver branch of the Bancroft family, previously holding out for a higher offer, capitulated, giving News Corp at least 32% of the family vote. Nonetheless, one Bancroft family spokesperson said today, “Any suggestion that the process has been completed and/or that a particular level of support has been established is at this point premature.”

Both companies have board meetings this evening to formulate the take-over procedure. Dow Jones is trading up 7.04% to $57.50 today.

News Corp. Appears to Have Enough Votes to Clinch Deal [Wall Street Journal]
Murdoch Seen to Win Control of Dow Jones [NY Times]

This is a list of people who we respectfully submit are liars: CNBC’s David Faber, Thestreet.com’s Nat Worden, and Reuters. We believe these entities to be capital 'L' small 'i' small 'a' small 'r's because among them they share the distinction of having reported or re-reported this morning that there will be an official announcement of News Corp.’s Dow Jones victory tonight. Nothing personal, it’s just that we no longer believe the words coming out of the mouths of people who say anything—outright, implying, leading, lip synching—that even hints that this whole thing will be conclusively finished before hell freezes over. We WANT to believe them, we just can't. Know anyone you’d like to add to our list? Send his/her name to tips at dealbreaker dot com.

In other news, MySpace co-founder Brad Greenspan sent an open letter to Dow Jones shareholders detailing a new proposal (he’s done this before, several times) in which he would invest $600 million in cash and stock in three joint ventures with DJ. Greenspan says he’s received “interest” from five “credible” investor groups, though he would not disclose their names, and their profiles are set to private. Brad informed shareholders that he and his investors “can meet this week” in order to “firm investment commitments,” but starting next week things are going to be really tight for him, so if Dow Jones could really get back to him A-sap to nail something down that would be solid, just name the time and place, but seriously, get back to him soon, otherwise, who knows, he could be busy.

Dow Jones to Agree To Takeover by News Corp. [CNBC]
Dow Jones Deal Gets Closer [WSJ]
Dow Jones Soars As Deal Appears Near [thestreet.com]
News Corp., Dow Jones deal expected Tues [Reuters]
MySpace Co-Founder Makes Another Dow Jones Proposal [Bloomberg]

Rupert Murdoch’s bid for Dow Jones, once a sure thing, then “too close to call,” is now “highly unlikely” unless the Bancroft family increases its support of the deal by 5 p.m. today, the Wall Street Journal reports.

At the moment, 28% of Dow Jones’ voting power supports the deal, although it is unclear what percentage of Bancrofts voted affirmatively; 30% of the family needs to support Murdoch for his $5bn bid to go through. If this is not met, “News Corp likely wouldn’t take the deal to a full Dow Jones shareholder vote.”

After all the mud-slinging and Rupe’s cryptic commentary, this summer’s saga could come to a close tonight, in which case I will have no idea what to write about.

News Corp. Says It's 'Highly Unlikely' To Buy Dow Jones at Current Count [Wall Street Journal]

Two days after the contentious Bancroft family powwow in Boston, the Denver branch of the family announced it will vote against News Corp’s $5bn bid for Dow Jones, insisting that Rupert Murdoch raise his offer by $120-240mn. The Denver trust controls 9.1% of the Bancroft’s voting power, but has been watched closely by News Corp and Dow Jones management. “The outcome has been seen as too close to call, although the Denver trust's decision increases doubts about the deal's prospects,” The Wall Street Journal reports.

The Colorado Bancrofts want a 10-20% premium on compensation for super-voting B class shareholders (The Bancrofts) although News Corp spokespeople insist that the Murdoch will not raise the bid and that a two tiered compensation is not tenable.

Key Bancroft Family Trust to Vote Against News Corp. Bid for Dow Jones [Wall Street Journal]

A Bancroft wrangle over NewsCorp’s bid for Dow Jones ended in stalemate yesterday after emotional harangues from opposing factions, the Wall Street Journal reports. The meeting, in the Boston Hilton was so grueling that, “after four hours of discussion, family members were so hungry that they made do with a tray of stale danishes.”

Interviews with more than a dozen family members, outside advisers, lawyers and others involved in the process suggest that the outcome remains too close to call. What has seemed to many analysts like a logical move -- accepting a $60-a-share bid for a company whose shares previously had been trading in the mid-30s -- is still in question amid the deep emotions the bid has stirred. Participants said more doubts about a News Corp. deal were apparent at the end of the six-hour session than at the beginning.

On several occasions Bancrofts “held back tears” as they extolled the merits of an independent editorial board. One prominent Rupe resister, Jane Cox MacElree, seemed even to make the distressing “Daniel-Pearle-would-have-wanted-it-this-way” argument. Another opposing force claimed that the company was worth more than Murdoch’s offer of $60-a-share and that the family shouldn’t accept anything below $66.

Although only 30% of the Bancrofts’ voting power must endorse Murdoch’s proposal for it to go through, investors are becoming increasingly unsure that the deal is a sure thing, Dow stock is currently trading at $54.01, down from as high as $61.20 in June.

It looks like the interminable saga will continue for now, maybe even into August.

Relative Uncertainty [Wall Street Journal]

Off to a slow start here this morning because of the rain in New York City. We had to wait for our interwebs to dry out. (Just like Alphaville, the deal blog at Financial Times, which has reportedly had trouble due to the flooding in England. Unless that's just Brit-speak for, uhm, one too many pints on Sunday night.)

But it’s back to business now. And by “business” we mean, of course, the saga of Rupert Murdoch, the Bancroft family and the Wall Street Journal.

One of the things we’re sure has been absolutely frustrating to anyone who has been following the endless tape of this story has been the complete lack of information about which members of the Bancroft family and its representatives control exactly which shares and which percentage of the votes. It was only at the middle of last week that we learned that Michael Elefante, the partner at the Boston law firm Hemenway & Barnes who is a trustee for two of the largest trusts holding shares for the family, can deliver a little less than half of the family's 64% voting stake. Let’s call that 30% of the total voting power of the company.

Today the New York Times reports that the leader of the opposition to Murdoch within the family, Christopher Bancroft, controls around 14.5 percent of the total Dow Jones shareholder vote as of January. And his cousin, Jane Cox MacElree, is running around with 14.8 percent. (Apparently no-one else has more than 4.3%.) But you have to read a bit between the lines of the Times—too often the stuff we really want to know apparently isn’t “fit to print”—to understand why they spend so much time talking about Chris and so little talking about Jane. It’s because Jane isn’t really involved with the Dow Jones stuff, and leaves the decision making to Chris. So you can count her shares as shares controlled by Chris. That gives him around a little more than 30% of the voting power of the company, or about what Elephante controls. To that you can add the “Never Murdoch” shares controlled by the Ottaway family to come up with a 36% opposed number.

In short, going into today’s big Boston Bancroft powwow, Murdoch is a bit behind. Probably at least 36% of the voting power of Dow Jones opposes him. He’s got 30% on his side. But Murdoch has a secret weapon: the 30% or so of the voting power vesting in shares that were once held by the general public and are now held by stock arbitrageurs, the Bancrofts, the Ottaways and a few people who aren’t paying any attention. Most of those shares will vote his way. To play it safe, let’s put that pro-Murdoch number at around 25%.

Which gives Murdoch right around 55% of the voting power of the company. Since he only needs 51%, that means he wins. But it’s close. And since we’ve been guestimating at a few of the crucial numbers, it’s possible that it’s even closer than this. If the numbers are shifted a couple points in the only direction—say, Elefante only has around 28% of the vote in his pocket and only 22% votes held by common shareholders go for Murdoch, he’s down to a losing 50%.

Which leaves us at the exciting possibility that we may be entering the rare situation where a very few amount of votes—perhaps those held by a small shareholder who doesn’t even remember he has the shares in his account (or his attic)—could swing the voting. In short, the Bancrofts may be meeting in Boston in 2008. But the voting may well be in Florida, 2000 territory.

A Family Meets Today to Hear the Complexities of a Bid for Dow Jones [New York Times]
Bancrofts To Consider Murdoch Bid, ‘Close Vote' Predicted [New York Sun]
Know Your Bancrofts [New York Magazine]

When Wall Street Journal’s Sarah Ellison broke the story late Monday that Dow Jones chief executive Richard Zannino and News Corp’s Rupert Murdoch reached a tentative agreement over lunch to bring the News Corp’s bid for Dow Jones before the board of directors, many were surprised that the offer price hadn’t budged from original $5 billion, or $60 a share.

They shouldn’t have been. Throughout the months since Murdoch first approached Dow Jones representatives with his offer, advisers to Murdoch have coached him not to increase his bid. Early on some thought he might increase the price in an attempt to overcome resistance from some members of the Bancroft family. But Murdoch’s investment bankers advised him that it was foolish to bid against himself, raising his offer at a time when the Bancroft’s had not yet indicated that they were willing to sell at any price.

Some of Murdoch’s advisers believed that a higher, second bid might have actually invited a competing bid for the company if it was seen as Murdoch’s best offer. By sticking to the original bid, Murdoch may have discouraged other potential bidders who were not sure they could outbid the deep pockets of a cash rich News Corp.
Even after negotiations with the Bancroft family began, some observers thought Murdoch might increase his bid. “While the initial $60-a-share offer represents a hefty premium over where Do Jones’s stock was trading before Mr. Murdoch’s offer became public, Dow Jones hopes the Bancroft family’s ambivalence about the Murdoch deal could help the company extract a few more dollars per share,” Ellison writes in her story today.

The thinking in the News Corp camp, however, runs completely in the other direction. The Bancroft family had already extracted value from News Corp in the form of promises of editorial independence, and had dragged out the negotiating process—taking up time and energy from Murdoch and his advisers. These discussions and concessions have been seen as part of the price News Corp was paying to buy Dow Jones. In effect, they were counted as increasing the cost of the deal.

What’s more, the Bancroft family’s continued ambivalence despite the negotiations and concessions has frustrated Murdoch and his advisers. The view within the Murdoch camp has been that as long as the Bancroft family continued to resist selling the Dow Jones for non-financial reasons, there was little point in increasing the financial incentives.

“The Bancrofts kept saying that this wasn’t about the money,” one person familiar with the News Corp strategy said. “Murdoch decided to take them at their word.”

While initially trading higher this morning, the stock dropped today to its lowest level since the Bancroft family first agreed to meet with Murdoch at the end of May. This may indicate traders now believe that Murdoch will not offer a higher price than his original bid.

Dow Jones, News Corp. Set Deal [Wall Street Journal]

Although a NewsCorp deal will likely may be announced this week, Ron Burkle and Brad Greenspan, two renegade investors no one takes seriously had a meeting with the Dow Jones board yesterday. The pair, who did not present an offer and have few, if any commitments from other investors, want to “buy out only those members of the Bancroft family who wanted to sell,” the New York Times Reports.

The primary Dow Jones union recruited Burkle, who owns the private equity firm Yucaipa Companies, to partner with Greenspan and block Rupert Murdoch’s bid in what seems to be another effort to protect the journal’s editorial independence. The New York Observer details the lunch between Greenspan and a union leader in which the plans were discussed.

“I think it’s clear the family does not want to sell to Rupert Murdoch. If they did, they would have taken the $5 billion a long time ago. We would much rather have the family continue its stewardship of this company. I believe that working with Burkle and a number of other people, we have alternatives, if the family wants an alternative," union leader Steve Yount tells the Observer.

But does this make any sense? Does the addition of Burkle make Greenspan’s half-baked bid less crazy or twice as crazy? We would side with the latter, but don’t take our word for it. Take the word of the former chief executive of Dow Jones, Peter Kann, who the Journal describes as "outspoken in his support for the independence of Dow Jones"

“If the family is going to sell I see no point in pursuing industrial conglomerates, Internet entrepreneurs, supermarket magnates and real-estate developers. None know anything at all about journalism. As to Mr. Murdoch, at least he loves newspapers, presumably would invest in the WSJ and Dow Jones, and would seem to have little incentive to tarnish a trophy he has coveted for so long,” Kahn says in today's Journal story on the item.

Also, see Gary Weiss for what happens when amateur investors buy newspapers. A serious question for Dow Jones employees who may be invited to join some sort of leveraged Employee Stock Ownership Plan rival buyout bid is whether they want to spend part of their paycheck buying the company from the bondholders for the next decade or so. Because that's the best-case proposal from a Burkle-Greenspan partnership.

Shares of Dow Jones traded slightly lower today, bringing our technical arbitrage measurement down to 90%. But we're exercising our own editorial independence here and refusing to move the meter. It remains unchanged at 95%.

Burkle and Greenspan Gather Journal Kiddies for ESOP Fable [New York Observer]
Dow Jones Hears Alternative Proposals [Wall Street Journal]
2 Investors Discuss Partial Purchase With Dow Jones Board [New York Times]

For a couple of weeks, shares of Dow Jones & Company have been trading below the $60 price Rupert Murdoch offered, which most likely reflects a slight discount for risk that the deal won’t ever go through, skepticism about the notion that Murdoch might offer even more money for the media company and the belief that the deal won’t close immediately. We’ve had the Murdoch Meter, which measures the chance of Murdoch buying the company at his offer price, fixed at 90% for some time. And shares have been trading between $58 and $57.

This morning world came from across the Atlantic that negotiations with the Bancroft family were done and a deal announcement was imminent. Shares jumped on the open and kept climbing despite reports on CNBC and DealBreaker quashing the rumor. They’re now at $59. This pushes our auto-arbitrage meter up to 95%.

Ordinarily we’d just correct the meter if it moved on fake news. But we’re hearing things that are convincing us that although the Bancroft family may not yet have formally accepted the offer, an announcement may be coming soon. The right people—lawyers, bankers—are busy this weekend, not making appearances at places we expected them to be. And they are clamming up, as they often do before a deal is announced to the market. From this, well, anti-leaking we’re reading an imminent deal.

Of course, since so much of this depends on what is decided a very few individuals who happen to be descended from people who bought the company a few generations ago, this could all change. But we’re following the arbs and fake news today and moving the meter up to 95%.

It’s only been reported in one British paper (so let’s remain skeptical, because those publications have a tendency to lie) but according to The Business Rupert Murdoch has “succeed with his $5 billion bid for Dow Jones.”

Allegedly, negotiations have been completed (less, “we want more money,” more “editorial independence, don’t make this the Post, you can only hire and fire the top editors and publishers, etc”), the board says the deal will be accepted by the Bancrofts over the next few days and a formal announcement is expected net week. News Corp will apparently pay $60/share, a 67% premium on the $36/share price in April.

Like we said, no one else has this story, though one of the writers, Andrew Neil, is a former “Murdoch lieutenant,” so perhaps that adds a miniscule amount of plausibility. According to CNBC’s David Faber no deal has been reached, despite news to the contrary from “some rag in a far away place.” Anyone else care to comment?

EXCLUSIVE: Rupert Murdoch buys Dow Jones, owners of the Wall Street Journal [The Business via Gawker]
'Murdoch buys Dow Jones' report [The Guardian]

When it came out that Rupert Murdoch and Dow Jones had agreed on a way to preserve the Wall Street Journal’s editorial independence, we naively assumed that a compromise had been reached. In fact, the “agreement” consists of exactly what Murdoch wanted and more, the New York Times is reporting.

The details have not been finalized, but as it stands, News Corp will have the exclusive power to hire and fire top editors at the Journal. In addition, and this is the shocking part, the board of editors the Bancrofts want established as shield against Murdoch’s influence will not have veto power over any News Corp editorial appointees. Even the similar board at the Times of London, which the Bancrofts have cited as an example of too much News Corp influence, has this veto.

The Bancrofts still haven’t seen the agreement. Based on their past behavior, they probably won't be happy about it.

In related news, some Wall Street Journal staffers are apparently taking half the day off work today to protest Murdoch’s bid. According to a Newspaper Guild statement from this morning,

“The Wall Street Journal's long tradition of independence, which has been the hallmark of our news coverage for decades, is threatened today. We, along with hundreds of other Dow Jones employees represented by the Independent Association of Publishers' Employees, want to demonstrate our conviction that the Journal’s editorial integrity depends on an owner committed to journalistic independence.”

Also, MySpace founder Brad Greenspan’s weird effort to block Murdoch by buying 25% of Dow Jones is apparently still happening. "We have put out a proposal to the family and the board, and I think they’re looking at it with great interest. We plan to meet with the board later this week – that’s a new development," he told CNBC yesterday.

Dow Jones stock dropped slightly with the news, most likely out of fear that the Bancrofts won’t like the agreement the board reached with Murdoch. The meter has slipped 5%.

Tentative Dow Jones Sale Pact Said to Give Murdoch Power to Hire and Fire at The Journal [NYT]
A statement from Wall Street Journal reporters [Romenesko]
Dow Jones Bidder to Meet Board; News Corp. Deal Reached [CNBC]

After yesterday’s announcement that an “agreement” had been reached to secure the editorial independence of the Wall Street Journal, Rupert Murdoch said that he would not raise his current, $5bn bid for Dow Jones. “Everything is done. We are just waiting for a final approval of the Bancroft family. The final approval is in the next two, three week’s time or not at all,” Murdoch said today from Poland.

This, of course, doesn’t mean a modest bid increase is out of the question. One can hardly expect a perspicacious dealmaker like Rupe to tell Reuters, “I probably will up the offer, I just want to see if the Bancrofts will take the five billion first.”

It also seems that yesterday’s agreement on the Journal may have been prematurely announced. Parts of the deal remain, “sketchy or not yet written,” the New York Times is reporting. “The nuts and bolts are there, but not all the details,” a source involved in the negotiations said. Only a few of the Bancrofts, who have ultimate veto power over the deal, have been briefed on the still-unreleased Dow-NewsCorp. agreement.

Dow Jones Accord In Place, But Incomplete [Dealbook]
Murdoch: No plans to raise Dow Jones bid [Reuters]

We were so busy bringing you the news that the board of Dow Jones & Company and News Corp have agreed in principle on a plan to protect the editorial independence of the Wall Street Journal (apparently no one cares about Barron’s), that we neglected to update the Murdoch Meter.

Contrary to the suspicions of some, the meter isn’t set by the arbitrary whims of the DealBreaker editors and reports. It’s set by the interns.

Just kidding. We employ a complex formula employing market variables to distill the meter’s current standing. Without going into the details of our secret formula, we'll give you the outlines. We take the current share price compare it to Murdoch’s offer, and discount for information we think may not yet be fully digested by the market. Right now the Meter tells us that Murdoch has about a 95% chance of acquiring Dow Jones. (In case you need a more recently updated version, you can now click here.)

By the way, the deal is not quite done. Although the Dow Jones board, which includes representatives of the Bancroft family, may have more or less reached an agreement with Murdoch, the family has been surprisingly fractious and unpredictable through this process. It’s not clear that any attempt has been made to poll Bancroft family members on the proposal. Most likely, they haven’t even seen the details yet.

What’s more, the Wall Street Journal reports that there are still “open items” that remain. In our experience, these small “open items” that get left until the last minute either get swept away or become DealBreakers. Sometimes they remain open because nobody could be bothered to deal with the small things. After hour upon hour in a conference room, when the only thing left to drink is diet Sprite and all the cookies are raisin granola, you’re hardly in the mood to debate the eye-care plan for executive assistants. But sometimes those things end up mattering to someone who matters, or cost more than anyone imagined. We’ve walked back into conference rooms the day after to discover that our small “open items” list—usually kept on a legal pad or a laptop by the most junior person in the room—has become a list of DealBreakers. Beware the open items.

Update: Some are wondering whether this whole process is a farce. Gary Weiss writes of the agreement to protect the editorial independence, "I think any such agreements aren't worth the paper they're written on, but then again I'm cynical."

Dow Jones, News Corp. Agree On Set of Editorial Protections [Wall Street Journal]

Less than twenty-four hours after the board of directors of Dow Jones announced they were taking over negotiations with News Corp, Financial Times publisher Pearson and General Electric announced they were dropping plans to make a joint bid for the company that owns the Wall Street Journal.

The two companies had been negotiating with each other over a deal that would have combined the financial news network CNBC, Dow Jones and the Financial Times. Critics of the proposed plan said that it was too complex, would cost too much and was likely to result in job losses at the newspapers. Shareholders at Pearson had already begun to object to the company spending heavily to buy another financial newspaper. And some wondered whether antitrust authorities in the US and Europe would even permit the combination.

But for all its problems, the potential partnership was arguably the only credible alternative to the offer from News Corp. Despite the Bancrofts publicly saying they would sell the company under the right circumstances and a hunt by union representatives for an alternative buyer, no one else has emerged with a firm offer for the company. Right now it’s Rupert or nobody.

Pearson, General Electric Drop Plan for Dow Jones Bid [Bloomberg]

Is Rupert Murdoch expressing unbridled confidence ("I can take a few days off, Dow Jones will be there when I get back") or throwing in the towel?

Check out the full picture after the jump.

Although Pearson PLC is being called a possible ‘white knight’ bidder for Dow Jones & Co, many in the newsroom of the Wall Street Journal are not enthusiastic about being bought by the publisher of the Financial Times. Reporters at the Wall Street Journal, many of whom regard the Financial Times as an inferior paper with low-quality “Brit journo” standards of fact-checking and sourcing, are worried that ownership by Pearson will deteriorate journalistic standards at the paper, a source at the Journal told DealBreaker.

“I took a straw poll around the office. A lot of people are worried about what this will do to the Journal’s reporting,” the source said.

Word began to circulate late on Friday afternoon that General Electric and Financial Times publisher Pearson were “in talks” about a potential joint offer for Dow Jones & Co. Over the weekend, the story ran in the Financial Times, the Wall Street Journal and the New York Times. A decision on whether or not to make a bid is expected to come within days.

A news of a possible bid from Pearson and General Electric may have the ironic effect of making the bid from News Corp more attractive. While News Corp chairman Rupert Murdoch has promised to spend more on the Wall Street Journal, expand its international presence and has announced plans to launch a new cable news network for financial news that may give Journal reporters more outlets for their reporting, a bid from Pearson and General Electric would likely involve mostly cost-cutting synergies.

[After the jump, the not-exactly-surprising news that Journal reporters aren't totally psyched about working for the publishers of the Financial Times.]

The Bancroft family has reportedly rejected a proposal prepared by its lawyers. The proposal was intended to protect the editorial independence of the Wall Street Journal and it was widely expected that it would be submitted to Rupert Murdoch this week. After debating the proposal, however, the family has apparently decided that it did not offer adequate protection for the paper.

To grasp the most striking thing about the rejection of the proposal you have to know something about the folks who prepared it. One of the law firms representing the family is Wachtell, Lipton, Rosen & Katz (they are also represented by Boston law firm Hemenway & Barnes), which is legendary for its defense of corporate boards and management against unsolicited takeover offers. Name plate lawyer Marty Lipton is often credited with inventing the so-called ‘poison pill’—a controversial tactic that prevents hostile takeovers by creating new shares of stock to dilute the ownership of the would-be acquirer. If Lipton—or the top-of-the-class, Ivy-league trained lawyers who work for him—has drawn up a plan to defend your interest in a company and you conclude it’s too weak, you might not quite be operating according to a map that has a lot of overlap with a territory called reality.

[More on the Bancroft Family follies after the jump]

It looks like the Bancroft family blinked first, issuing a proposal on editorial independence to NewsCorp today. Murdoch’s not likely to agreed to the proposal, however. Even the Bancroft’s don’t sound too hopeful, noting that “This is not a done deal.”

Reporting on itself, the Journal said that negotiations between Murdoch and the Bancrofts would only continue if family is convinced that it has safeguarded. But it’s safe to say that Murdoch acquisition ambitions moved one step closer to reality with this move by the Bancrofts. One rule of negotiating deals it that the side that comes back to the table first certainly isn’t looking to walk away altogether.

Also, last week Dow Jones granted 135 managers eligibility for severance pay in the event of new ownership. As part of this move, Dow Jones CEO Richard Zannino's current golden parachute, which is worth $19.5 million would increase by 20%-30%. Nothing like promising management a payday to get them behind the deal.

Both these events would have moved the needle on the Murdoch meter if not for the ominous sign that arose yesterday: Jim Cramer started giving unsolicited advice to Murdoch. This clearly spells trouble. Any progress from the Bancroft move and the new golden parachutes was completely erased by the entrance of the first citizen of Cramerica.

[This report filed by Senior Rupert Murdoch correspondent Peter Ribic.]

Bancrofts Set Revised Safeguard Proposals [Wall Street Journal]
Dow Jones Expands Its Golden Parachute [Slate.com]
Rupert’s Eleven-Year Hunt [New York Magazine]