Legg Mason's Unit Increases Countrywide Stake to 14.9% (WSJ)
Legg Mason is making a big arbitrage bet on Countrywide, as it now owns 14.9 percent of the company that may get bought out by Bank of America. Additionally, there's some hope that another bidder may emerge, which Legg believes may happen if Countrywide were to remove a poison pill. All in all, sounds a little risky to us. But, no doubt, Bill Miller is willing to pull out the stops to get back to his old S&P-beating ways.

Venezuelan State Company Stops Sales of Oil to Exxon (Bloomberg)
Is Venezuela freezing oil shipments to Exxon all that big of a deal? Our hunch is no. We can understand why people might think so, but if anything, we suspect that all this whole little episode will do is basically just expose the Chavez regime as a bit of a fraud. An analyst at CERA said the same, that it's all rhetoric, with little real impact likely. Wake us up when some rebels set a pipeline fire in Nigeria.

Delta CEO Waives Merger Compensation (WSJ)
We're always skeptical of airline mergers. That they'll happen and that they'll work if they do. But first they have to happen and it does seem like something is likely to occur soon, although we've been hearing that some big announcement is going to happen "any day now" for like three months. The CEO of Delta has decided to waive pay he'd receive in the event of a merger, which is taken as a sign that Delta is serious about getting a deal done. Perhaps. But why do CEOs get merger pay? Severance pay is one thing. And it's another thing if a merger would results in the CEO getting shown the door. But just as a payment to get a deal done, it seems like one of the more perverse forms of compensation, no?

Writers Vote to End Strike (NYT)
Now this is the real vote that mattered. With 100 percent of the votes counted, 92.5 percent of the writers voted to end the strike. It's not clear who the other 7.5 percent were. Probably the nerdy ones who have run all the regressions on the math and feel like they're getting shafted on digital revenues. Or maybe they're just the hardcore unionites that believe a strike is the soul of the union, the bracing tonic through which it finds its identity.

Allianz Shares Fall on Concern About AIG's Accounting Problems (Bloomberg)
The old market for lemons in action: AIGs accounting appears to have been lemonish, so Allianz SE's might be too. Shares of Europe's biggest insurer fell 4.3 percent following news that the American insurance giant didn't know how to value its assets. Allianz recently put out numbers, but they haven't been certified by auditors. Apparently there's a reason to pay attention to that caveat.

Feds to Unveil New Mortgage-Help Plan (AP)
A group of banks and the federal government are expected to announce today some sort of aid plan to troubled homeowners that will allow them to try sticking it out in their homes and forestall foreclosure by 30 days. Our first assumption, of course, is that it's just a band aid over a gaping gash. But we also wonder how the banks can offer this to homeowners when the banks are rarely holding the mortgages. Presumably, either the banks or the federal government will be making that extra month's payment themselves to the mortgage holder, though we don't really know how that works.

Dow gurus may wish for one last puff (Tribune)
A long time ago (like eight years ago), we were watching an interview with Maria Bartiromo (she was the interviewee) and she was talking about the mania for markets in the public consciousness at the time. So she related some anecdote about getting into a cab and the driver immediately asked her where the DJIA was it. The story was meant to convey the fact that a) even cabbies know what the Dow Jones is and b) even they can recognize Maria Bartiromo. But what struck us was c) that the driver was mainly interested in the Dow, as opposed to say the S&P 500 or the Wilshire. Anyway, we still wonder why people get so excited about the Dow, when everyone know its measurements is bizarre and its components are somewhat arbitrary.

Dem. Pres. Primaries (Intrade)
As always, our election-morning check of the political markets. Today we've got the so-called Chesepeake Primaries, though apparently Potomac Primaries are more geographically meaningful. Whatever, we're not seeing much value here. Obama is priced for a big win in all three states, trading above $.90 in Virgina and Maryland, and there's not even any trading in DC... just can't make a market for it. The CW is that he'll win in these states pretty handily and the market reflects that without hesitation.

Societe Generale Plans Offer to Raise EU5.5 Billion (Bloomberg)
So SocGen will replenish itself with a big Blue Light Special on its stock. The bank plans to raise about $8 billion, by selling shares at a 40 percent discount from its last closing price. Existing shareholders will have the right to buy one share for every four they own. Analysts, apparently, had been expecting a 30 percent off sale, so this would be a little steeper than that. With the latest slide in shares, the company has a EU35 billion market cap.

Graft Paper (The American)
The key sentence: Olken and Jones discovered that a country was “more likely to see democratization follow­ing the assassination of an autocratic leader,” but found no substantial “effect following assassinations—or assassination attempts—on democratic leaders.” They concluded that “on average, successful assassinations of autocrats produce sustained moves toward democracy.”"

An inglorious anniversary (NakedShorts)
It's been a long year. And it's been one year since the IPO of Fortress Investment Group. That first day of trading: "back in the days when sub-prime meant finding gristle in a filet at Smith & Wollensky, it opened at $35, traded up to $37—still an all-time high—and closed at $31."

Theory Gains That Trader Had a Helper (NYT)
This is going to sound totally asinine, but we, at the Opening Bell, are actually getting a little tired of the SocGen rogue trader story. Yes, it should be endlessly interesting. You know, $7.2 billion and all, but... something... hard to say. Even rumors about a conspiracy and it "going all the way to the top" don't animate us as it should. Maybe cause it's French, but maybe not. Anyway, he might've had a friend. If so, does that mean the two only get credit for $3.6 billion each? They can't both get credit for the full $7.2 billion, obviously.

Alcatel-Lucent Posts $3.74 Billion Quarterly Loss (Bloomberg)
Whoa, what year is this? You'd think that Alcatel-Lucent had just made some sort of ridiculous acquisition, and now they're taking a "paper" loss. Of course, $3.74 billion is actually sort of tame compared to some of the writedowns among the big gearmakers back in the day. Shares have fallen 59 percent in the last year.

Coca-Cola buys stake in Honest Teas (Oligopoly Watch)
We didn't realize it before, but Coke has acquired a 49 percent stake in bottled tea maker Honest Teas. It's a small deal, though as Oligopoly Watch points out, it continues the trend of moving away from the carbonated drinks business. That part is smart: soda is a loser, long term, when people get their heads on straight. But so are weakly flavored, partly-sweetened teas. Seriously. If you want a good tea, then get that Japanese iced green tea from Ito En. Coke should buy them out. Everything else is pretty foul.

Creators of Credit Crisis Revel in Las Vegas (NYT)
Shocking. Despite the fact that the world of credit derivatives are in turmoil and banks have lost billions by skinny dipping in that pond, market practitioners have the temerity to meet in Vegas. They even arrive in, oh my, private jets. So while people are being foreclosed on, and shareholders have been flummoxed, they're still partying it up at the venetian. And some are even looking for ways to profit from the current mess.

The $72 Billion Social-Climber (Weekly Standard) (via CrossingWallStreet)
A good take on the implications for French culture of the Kerveil mess. It's not totally new ground. There's been a lot of brain picking about the guy, as well as discussion of his background and the fact that he "shouldn't have been there" in the first place. But still a worthy Friday read.

Dubai fund buys historic London site from Queen (AFP)
This feels like one of those things that occurs nearing some peak of something. We're not saying that this is a sign of anything right now. Just that in the past, stories about some government buying a major piece of historic real estate would in retrospect be ascribed as a significant indicator. Again, just trying to make a point of how we read history. A fund in Dubai is spending 255 million dollars on a property owned by the Queen that sounds to be marginally historic. Sounds like it's probably a reasonable price. But, if the Dubai economy collapses tomorrow, watch for people to point to this as a key moment, at some point down the road.

Drug Ads Raise Questions for Heart Pioneer (NYT)
There's something a little unsettling about the Pfizer Lipitor ad featuring Dr. Jarvik, the first inventor of the artificial heart. Obviously Jarvik's demeanor is a little unusual. And it's not totally comfortable to hear someone talk so earnestly, for so long about a pill. But the suggestion that somehow the commercial is unethical, or wrong in some way, is a little weird. Like, I'd rather hear hist take on it, as a man who clearly knows the heart, that some yahoo reading a script. If we had to guess though, the commercials are probably done for. Since there's so little tolerance for legal or PR risk these days in that industry.

Wal-Mart Will Expand In-Store Medical Clinics (NYT)
Maybe the minute clinic concept isn't dead after all. A couple weeks ago, there were reports about walk-in health clinics shuttering inside Wal-Marts. But perhaps it was just that one company having the trouble, and not something bigger having to do with the rest of the industry. Because now the retailer is making its own push into the health game, partnering with hospitales to put more such clinics in stores. The idea of cheap, commodity health care for the simple things in life (soar throat, earache, etc.) makes a lot of sense to us, so it'd be cool if the concept worked out.

Senate Stimulus Bill Fails to Advance (WSJ)
Seriously, this is why we love to see gridlock in Washington. Good things only happen when the parties are at each others' throats.

Icahn Set to Host Blog On Corporate Abuses (WSJ)
Carl Icahn is apparently set to start a blog at Icahnreport.com, where there's apparently nothing. It looks a little chintzy. Seems like he could do some design work, though we're sure he won't waste much money on that. We're also still not 100 percent sure it's not a fake. You know, like some Newsgroper spinoff. But apparently it's real. The blog's topic will be corporate governance, so hopefully he'll engage with the broader corporate governance-o-sphere. And just a guess: he's probably not going to go into detail on his active investments, which will be a disappointment. In fact, we were particularly excited to hear his discussion about Greenbriar, the railcar maker.

Asian Stocks Sink After Dow's Plunge (AP)
The back-and-forth volley once again. Hang Seng down 5.4 percent. Japan down 4.7 percent. They're just following us, but now it's time to follow them.

Solid waste oligopoly (Oligopoly Watch)
We once talked to a guy who leaned into us and told us, "If you want to know the real dirt about New York, talk to a trash hauler... one of New York's Strongest." And to be perfectly honest, we weren't surprised that a trash hauler knew where "the real dirt" was, though that's not actually what he meant. He meant in terms of how this city runs and certain unappealing facts about this process. It was basically just a bad choice of words. Anyway, the whole industry is dirty. Oligopoly Watch takes a look at the industry and how hard it is for startup players and the scandals facing the majors. It's almost like the bond rating business.

BHP raises Rio bid; no immediate Chinese riposte (AP)
This has been in the works for a while, but now it's finally happened. BHP Billiton has gone ahead and made a -- are you sitting down? -- $147.4 billion hostile offer for chief rival Rio Tinto. It was seen coming for awhile, but the final numbers are still rather jarring. $147.4 billion. Billiton says it's the firm's final and only offer and that it's all in the hands of Rio. The move, of course, comes after Chinese firm Chinalco and Alcoa took a stake in BHP, so it's not clear how that will play out. Expect this to drag out a long time and to totally dominate Microsoft-Yahoo in the popular consciousness. Ha, yeah right.

Sugar Supply Signals Bear Market as UBS Sees 18% Drop (Bloomberg)
The increasing cost of calories has prompted an "end of cheap food" meme. We think there might even a book about it, though we've been wondering if the rising price of sugar and corn is basically an anti-obesity market mechanism. You can't prove that it's not, is all we'll say. Even if it's not direct, it's still probably a good thing that sugar has become more expensive. But peak sugar may be on its way out, say analysts. For one thing, sugar inventories are very high. Another: oil prices are edging down, reducing the demand for sugar-based ethanol. And people are waking up to the fact that sugar should be classified as a deadly hard drug. Just kidding about that last fact.

Actively Traded ETFs: A Step Closer to Reality (WSJ)
Given the fall from grace that mutual funds have seen and the rise of index funds and ETFs, what purpose do actively traded ETFs have? Isn't the whole point that retail investors don't want to pay fees to a manager, only to see their holding underperform the market, anymore? This is a serious question. We thought the this article might address some of the obvious issues here, but really it only brushes on them, acknowledging that higher costs and taxes might be an issue. But as far as well can tell, it's the issue.

Presidential Nominees (Intrade)
We mentioned these numbers yesterday, but figured we'd link back today, since it's the big day. Still neck and neck on the Dem side $.53 vs. $.47, and still a blowout on the other side. We still think the private equity guy might be a good value, especially if you can find someone to lend you 4/5ths of the upfront capital to buy your contracts. If you win, you'd be looking at 50x winner. As Eliezer Yudkowsky points out, if you don't trade on your beliefs, then you truly don't believe them, otherwise you're an idiot who doesn't believe in free money. Truer words... truer words.

Europe’s Central Banker Engineers His Economics (NYT)
We mentioned yesterday our sense that the ECB saw things differently than our Fed, or at least appeared to have a meaningfully different mandate. This article goes into things a little more, discussing its view that inflation is the real culprit and that its job is not to fight the economic tides. We sort of get the impression that in the US, there are a lot of folks resenting the fact that the ECB isn't "playing along". It's like they're denying the economic realities we see here... or maybe they just don't see them for a reason. And since they're not playing along with the rate cut game, we can't cut without putting more unbalanced pressure on the dollar.

Hong Kong shares close sharply higher, led by financials (AFX)
A good night for financial stocks in Hong Kong. Why? Because of the snow in China. How does that benefit financials? Because maybe it'll make the Chinese central bank hesitant to raise interest rates. At least that's the theory put out there by someone. Convoluted, probably. After all, the only reason the central bank wouldn't raise interest rates is if they thought growth was slowing, which you think wouldn't be so good. But whatever.

Google Offers to Help Yahoo Fight Off Microsoft (WSJ)
Apparently Google CEO Eric Schmidt has contacted Yahoo CEO Jerry Yang about doing something to help thwart of Microsoft's bid. We're not sure what it is, or what it could be. The general consensus is that the company can't actually make a bid itself though. In the meantime, it seems like it would be a perfect time for the folks to bone up on their Sun Tzu -- we can only imagine that the warrior-philosopher-turned-business-pundit has a lot to offer about friends f friends and enemies and enemies and times of crisis.

Studios Set Stage for TV's Return (WSJ)
Nothing official yet, but word is that they're on the brink.

France Said to Suggest New Controls for Its Banks (NYT)
Nice timing. French regulators are looking to impose some new controls on banks, you know, so that they might better avoid multi-billion trading losses next time. Among the things they'd like to see happen: alerts to senior management if a trader was getting a bit wild. Of course, if a trader knows the inner workings of the system, and can purposely avoid detection, it's all sort of moot, isn't it?

China Snow Crisis Shows Vulnerability (AP)
This isn't a metaphor. The China snow crisis is just that, a crisis about snow. As in the cold white stuff that we've had none of this year. Apparently certain parts of the country are getting hammered, leading to all kinds of supply chain issues and shortages of food and fuel. Just like our politicians, the Vice Premier has "repeated calls" on coal deliverers to make sure gets delivered. And we thought only politicians that had to run for office "repeated calls".

Yahoo Profits Fall 23%, Cuts 1,000 Jobs (InformationWeek)
Investors were expecting a weak forecast and layoffs and that's what they got from Yahoo. There were probably some people holding their breath, hoping for some sort of shocking, out-of-the-blue surprise, but no. The company is still in shift mode, changing its strategy, realigning, repositioning itself, etc. And it sees "headwinds" this year, which means it's flying perfectly, but outside forces on which it has no control are slowing it down. Right.

The Bond 'Transformers' (WSJ)
Who says government is pure reactive? Well, they'd be right. And who says regulators often foolhardily attempt to fix complex problems with simple, band-aid solutions? Well, they'd be right too. New York regulators are, get this, looking to close a "loophole" that allows bond insurers to dabble in derivates. Great timing on that. You can read the details here, but the point is, it's pretty rich timing, with the bond insurers knocking on heavens door to start thinking about if they could've done business in some safer, more transparent manner.

A Dose of Realism for VMWare (MarketBeat)
After delivering some disappointing numbers on Monday night, VMWare got crushed yesterday, falling over 30 percent. The bloom, as they say, is off the rose. MarketBeat looks at the new sentiment towards the once-hot virtualization company. Funny how things can change overnight. Suddenly, it's just another enterprise IT play clawing it out for a chunk of scarce dollars.

Baucus Stimulus Plan May Spur Conflict (WSJ)
One of those things they teach you in undergrad poli sci is that the Senate doesn't like to take its cues from the House. The House could pass a resolution calling the Senate the most important of the two bodies, and the Senate would still find something in the language to change. So it's no surprise that Senators are not quite ready to rubber stamp the eocnomic stimulus first passed in the House. Sen. Max Baucus has proposed an alternative econ stimulus plan, whose main divergence from the House bill seems to be that wealthy folks get a rebate too. There's also an unemployment insurance extension not in the House. Just proves that the Senate/House divide actually runs deeper than the Democrat/Republican divide, which is actually sort of depressing.

Liberty Media Moves to Take IAC From Diller (WSJ)
The mind-boggling trapezoid known as the John Malone-Barry Diller-Liberty Media-IAC relationship has only continued to get more bizarre in the last week. Ever since IAC decided to split itself into five companies, the various parties have been growing tense and now Libierty wants Diller ousted. Great drama.

Operator of Walk-In Clinics Shuts 23 Located in Wal-Mart Stores (NYT)
This is too bad: we've always been optimistic about the role that retail, walk-in clinics could play in the healthcare system. You know, for your garden variety malady, you just walk in, pay $30 to a nurse and get your prescription. But what sounds good on an intellectual level doesn't always work in business, it would seem. CheckUps, which was operating clinics inside Wal-Marts has decided to shutter 23 of its stores and it's behind on payments to its nurses. Not sure what's going on exactly, but obviously not a great sign.

Further revelations dent SocGen’s reputation (FT)
The Kerviel story has legs -- which is as you'd expect when you're talking $7.1 billion. Increasingly, it's one of those what/when did they know kind of deals. And then when maybe earlier than previously admitted, even if the what isn't obvious. But apparently warnings were given as early as a year ago about a trader named Jerome Kerviel and how he was trading Eurex derivatives. What exactly those warnings were, however, is not known.

SocGen's Kerviel Charged With Attempted Fraud (Bloomberg)
Jerome Kerviel didn't flee. He's in custody and now they've formerly slapped him with charges, the most serious of which, abuse of trust, could carry a seven year jail term and 750,000 eur fine. But although he didn't book it to Tahiti, Kerviel isn't taking the charges lying down. It sounds like his lawyers plan to make a vigorous defense, which is cool. His lawyer claim that the whole thing is a charade, designed to conceal losses elsewhere. Until he's proven guilty, we'll presume him innocent and we can only hope for a long, dramatic trial which gives us deeper insight into the bank and the world of a rogue trader, if indeed he is one.

Countrywide's Mozilo Forgoing $37.5M (AP)
There's a reason they call him "Honest" Angelo Mozilo. The Countrywide CEO has agreed to give up $37.5 million in severance pay, considering the troubles that this company is going through. And you thought it was because he looked like a used car salesman. Hogwash. Among the perks he's giving up is access to the company's private plane. Some day he'll be waiting on a tarmac for five hours and start regretting that one.

Sears Holdings Names W. Bruce Johnson Interim CEO
Sears says its CEO Aylwin B. Lewis is stepping down immediately and will be replaced on an interim basis by W. Bruce Johnson, who joined K-Mart in 2003. Interestingly enough, Johnson actually has a real retail background, which is a sign of the company's acknowledgment that Sears, sadly, remains first and foremost a store where people buy stuff. Of course he's just the interim, so we'll see where they go with the position.

Shares End Sharply Lower; Nippon Steel Weighs on Tokyo (WSJ)
Another ugly day internationally, as stocks across Asia fell sharply while you were sleeping. Shanghai was down 7.2 percent, while Japan fell by nearly 4 percent. Hong Kong also lost over 4 percent. The big loser in Japan was Nippon Steel, which warned of weak US demand in its latest quarter.

Rogue Trader’s Story Raises More Questions Than Answers (Dealbook)
Given the extent of Jerome Kerviel's losses, folks aren't quite ready to believe he was a jackal working alone. We think it probably was though. But for now, people would rather believe that there was a conspiracy of sorts, rather than believe that a little knowledge of SocGen's computer system was able to render its entire risk management infrastructure 100 percent useless. People like to call big "nine-sigma" events black swans, but they're really not, because we get once-in-a-millennium perfect storms once every five years or so. But nobody's got a formula that knows how to take into account one trader that knows how to bypass security checks.

Trader Turns Societe Generale Report Into a Nightmare (Bloomberg)
Someone suggested yesterday that this whole story was a coverup for deep subprime losses. Better to pin it on a 31-year old kid that didn't even go to an elite college than on the upper ranks. We doubt it. Nobody would've blinked if the company had lost another $7 billion on writedowns. As it is, the company actually reported a big subprime writedown and nobody even noticed.

Scottish & Newcastle Agrees To Buyout by Carlsberg, Heineken (WSJ)
Beer consolidation, bring it on. Scottsh & Newcastle looks set to approve a sale to Carlsberg and Heineken in a deal worth $15.4 billion. That's a lot of money, for beer. With the deal, Scottish and Newcastle will be broken up, with Carlsberg and Heineken each taking over certain regional assets.

Buying Randy Newsom (Ideoblog)
Have you heard about this baseball player that's going to sell chunks of his future income to the public? Yeah, for as little as $20, you can buy a slice of infielder Randy Newsom's future earnings stream. Larry Ribstein looks at some of the legal issues and wonders whether this counts as a security that, theoretically, would be regulated by the SEC.

French Bank Finds $7.14 Billion Fraud (AP)
These days, a loss of $7 billion at a major bank is hardly anything to get excited about. It's all in a days work. But this time it's different. At Societe General, a single trader is said to have been responsible for more than $7 billion in fraud. This sounds like a story that will take some time to unpack, because it's still not totally clear what's happened. Evidently, he used his knowledge of the bank's security systems (a little odd) to conceal his actions, which involved a scheme of "elaborate, fictitious transactions". Though apparently they weren't so fictitious that they didn't cost the bank money. Anyway, trading in SG shares has been suspended and, this is rich, the trader apparently tendered his resignation, which was accepted. Good chance the trader has more pain coming to him. WSJ has more. and AlphaVille liveblogged the conference call, which sounded like a mess. S[eaking of messy conference calls, did you see that SLM boss Albert Lord apologized for his behavior on that call last year? Too bad. He should've stuck to his guns.

Leeson for sale, before he goes on holiday (to Paris) (FT Alphaville)
Not surprisingly, the real winner of this Societe Generale news is Nick Leeson, the man who's name is synonymous with rogue trading. His losses were lower than this, but he had the bad luck of winding up in a Singapore Prison. The man's turned himself around over the years and last we heard he was working for a football (soccer) club as a GM or something. Anyway, word is that he's going to charge more than £1,000 per interview. That doesn't seem like very much.

Asian Markets Mixed After Dow's Rebound (AP)
After the US staged a dramatic reversal of fortune, the good kind, not the bad kind, the rest of the world turned in a mixed performance overnight. Some markets were up, while others were down. That's what we like to see though. Markets moving in lock step, either up or down, are always a bit scary -- sort of like lockstep soldiers walking over a bridge. Always good when they break things up a bit and do their own thing.

Next on the Worry List: Shaky Insurers of Bonds (NYT)
Apparently there are these companies called bond insurers and apparently they play a big, under-appreciated role in the economy. And supposedly they've taken on too much risk and may collapse, resulting in untold calamity. Have you heard of them? Probably not, cause they're the next worry. Something to watch out for though, for sure.

Regional Indexes Rebound (WSJ)
It's been a volatile week and it's only Wednesday. After two days of fear, the foreign markets reversed course, with several former big losers surging by 5 percent. The big winner was Hong Kong, which tacked on a cool 10.7 percent. Japan sort of lagged, gaining only 2. So will we take our cues from abroad?

U.S. Futures Fall, Point to Sixth Straight Drop for S&P 500 (Bloomberg)
Probably not. It's sort of hard to get excited about a rate cut and a surge overseas when iPod unit sales are only growing by 5 percent and when the growth story of the decade reports conservative first quarter guidance. In addition, we've got eBay and Motorola on tap today, so could be more bad news. Nobody wants to hear that Motorola's new strategy revolves around more iterations of the RAZR. That'll be good for another half a percentage fall on the S&P.

Stocks May Drop to Reflect Recession, Strategists Say (Bloomberg)
This is awfully specific. An analyst at Bank of America says stocks need to drop another 4 percent to really price in a recession. Apparently the withering declines have so far been profit taking, or basically they're just not enough. 4 percent's pretty minimal though. What he's essentially saying is that a recession will be fully priced in sometime this afternoon, or maybe Thursday or Friday.

The (Unlisted) Hot Tickets at Davos (Dealbook)
Dealbook's Davos Diary reports, unsurprisingly, that the hot tickets at the World Economic Forum are not the main panels, but the private panels, lunches and after-parties hosted by top names, like Rupert Murdoch and the Google Guys. Makes sense. It's the same with SxSW down in Austin. Sure you can be like everyone else and go see Feist, or if you know what's hot, you can go to some listening party/bbq with the Pixies. Anyway, to us Davos has always seemed to attract more attention than it's worth. Yes, we understand that anytime you have the super-famous ans super-powerful hanging out in Switzerland together it's news. Fine. But we've never heard of anything of substance or meaning coming out. It's basically a chance for George Soros to be a boldface, right? Back in the day when it was all Bono, Bill Gats and Kofi Annan -- that seemed like its metaphysical peak.

Stocks Poised to Take Losses (WSJ)
Two words: car nage. After a terrible Monday, during which the US got a reprieve, the markets roared lower again while you were sleeping. Hong Kong gave up another 8.7 percent and Japan another 5.7 percent. But you know this already, because you were probably receiving text alerts every :30 in your sleep, not that there was much you could do. Oh and the futures. Yeah, bad. All down around the 5 percent marker. The good news: if the earlier declines were a correction, we must be getting really correct right about now. Also, as of this moment, there hasn't been an emergency rate cut announced, which a few folks were chatting about yesterday. It's still possible, sort of like an interstitial ad at Forbes.com. You think you're about to load the article, but then an ad pops up about about 5 seconds right at the last moment. So yeah, an interstitial rate cut still could be.

Loan Morsels (WSJ)
More on the credit crunch, from a small business perspective. The point: it's not just homeowners with a crappy income and a history of not paying their credit card bills that can't get loans. Small businesses that have tapped the well several times in the past can't raise cash either -- or they're at least having a hard time doing it. But at least there's money for small businesses coming out of Asia. It's not all Wall St.-bound.

Crude oil falls on U.S. recession concerns (Bloomberg via Tribune)
The good news continues to be that oil is dropping, which should bring some much-needed relief to US consumers. That's meant to be a joke.

Chinese Bank Shares Fall Sharply (AP)
More from the gloom & doom edition: Shares of Chinese banks have been whacked on anticipation of big -- of course -- subprime writedowns. The real issue is that shares of the Bank of China fell 4.1 percent in Shanghai and 6.1 percent in Hong Kong, confounding efficient markets theorists everywhere. So the question is: who's going to come through with the capital infusion the bank needs? The Chinese Development Bank or Abu Dhabi?

Major Indexes Drop Sharply On Worries Over U.S. Economy (WSJ)
An ugly start to the week on a global level with, with several world indexes dropping in the 4-5 percent range. Of course, it's all because they're worried for us, supposedly. The Indian market, which has held up strong lately, gave up 7.1 percent. Thankfully we have the day off. We still need some time to cool our jets.

Oil Falls Below $89 on Economy Concerns (Reuters)
At least with all of these stock market sell offs, the price of the dirty stuff is coming down as well.

SEC urged not to revive "terrorist" watch list (Reuters)
This is an idea that should probably be relegated to the dustbin of history. The SEC, apparently, offered a tool at one point to help investors search which companies did business in terror-sponsoring countries. Granted, it's easy enough to do a word search for Iran if you're interested in seeing what comes up among filings, but specifically hiving off a section for companies that may have an investment in Iran or Syria seems a bit ridiculous, no? The SEC is currently deciding whether to bring back the tool.

The Super Bowl Point Spread (CrossingWallStreet)
It's the Giants +13 or +14. Interestingly, the spread is being set extra high in order to induce underdog betters, since there's the perception that the Giants have no chance. So if you think there's a distortion, get your bets in.

Back in the Black (American)
This is the most shocking piece of business news we can recall seeing in a long, long time. The NHL is a profitable enterprise. We were sure that America' 6th or 7th biggest sports league (behind NFL, MLB, NBA, NASCAR, PBA, Arena League and the Professional Bullriding Tour) was a big ol' money sink, but things are actually okay. Not great, mind you. Very few people watch the game anymore, but with some financial engineering and cost containment, it would appear that the NHL will remain a going concern, which is definitely good.

Merrill Results Send Futures Lower (CNBC.com)
This is why they keep likening investing in the financials like catching a falling knife. There are so many of these big writedown reports yet to come ( we assume) that it's really hard to get excited about the sector. The details: Merrill lost $9.8 billion on a $14 billion writedown, which was obviously its biggest loss of all time. Of course, ex-writedown, they would've made some serious money, so don't forget that! Merill is down pre-market, as is the broader market. The announcement is here.

Bernanke Likely to Support Stimulus Effort (WSJ)
Economics observers have been forecasting a recession for a while now. It varies though. Some saw clear signs early in the summer, while others really only got on board late last year. And then there are our politicians, who are real finger-in-the-wind types and now they're all talking stimulus. But none were talking stimulus, say, 1 week ago. The S-word has really spiked in usage, basically since the beginning of this week. We tend to fall into the let there be pain camp, but if the government were going to do anything, it might've acted earlier. Also, people should lay off Bernanke. We'll just leave that at that.

When 3rd Place on the Rich List Just Isn’t Enough (NYT)
NYT profiles casino mogul Sheldon Anderson, No. 3 on the list of richest Americans. It notes that a lot of falks haven't heard of the man. Don't worry Shel, we have.

Citigroup Swings to a Loss, Cuts Quarterly Dividend (WSJ)
Today's the day we've all been waiting for. Citigroup posted a cool $9.83 billion net loss for the quarter and drumroll... slashed its dividend, surprising absolutely nobody, except maybe that one analyst. And yes, it just so happens that they've announced new funding; $12.5 billion worth, including $6.8 billion from Singapore. As usual, they time these things so that they're never just talking about losses without talking about infusions at the same time. The rest of the money came from various sources, including the Prince and the foundation of Sandy Weill.

Merrill Gets $6.6 Billion Infusion (WSJ)
Meanwhile, Merill. The other one. The company will issues $6.6 billion in preferred stock, with cash coming from Kuwait and Japanese i-bank Mizuho. With its other backers, including Temasek, Merrill has now brought on board $12.8 billion over the last few months.

Europe May Ban Imports of Some Biofuel Crops (NYT)
The EU may ban the imports of certain types of biofuel crops if they're deemed to be an environmental hazard. At first you might hear this and go "ah, Europe." But even if banning the crops' import is not the best policy decision, their thinking is not totally absurd. It's silly to talk about "green" energy if it's not even green. The most obvious example of this is carbon offsets. Sure, you can (theoretically) plant a tree and cancel out the effects of your car. But if planting the tree causes damage, soil erosion, biodiversity elimination, than you've just moved the problem.

Why Were The Forecasts So Bad?? (Dr. Joe Sobel)
So it was supposed to be a mad snow yesterday, and, who knows, there might've been a lot of natural gas traders ready to employ their favorite snow day strategy. But alas, the snow never came. We were happy about it, but some people were probably disappointed by that. So why were the forecasts so off? Well, obviously weather is pretty complex and chaotic -- everyone knows that. But as AccuWeather's Dr. Joe Sobel explains on his must-read blog, a slightly rainy day and a heavy snow day can have some very similar characteristics right before they happen. Maybe there's a deeper lesson there.

China's Government Could Hamper Citigroup's Plans to Raise Capital (WSJ)
The Chinese government is said to have put the breaks on a plan by the China Development Bank to invest in Citibank. It's not clear what the issue is, or if this is just a minor delay. Perhaps they're worried about having too much influence. Or maybe they're concerned about all this money going into capitalist countries. Or maybe they just don't think it's such a good investment and they want a couple more days to do their DD.

Wallstrip has a new Host - Julie Alexandria (Howard Lindzon)
It's true, it's true. Lindsay is leaving Wallstrip to start some new show at CBS. Apparently it will be called Moblogic.tv, which doesn't sound Wall St. related at all. Realistically, this can't be a big surprise, seeing as Lindsay's star seemed destined for bigger things (like moblogic.tv?). The new host is Julie Alexandria, who has filled in before. Giver her a chance before you get judgmental.

SEC Looks at Merrill Trading, In Search of 'Front-Running' (WSJ)
Did you do it? You know who you are. Probably best to fess up now.

Ford and Chrysler Unveil Their Redesigned Pickups (NYT)
Hybrdids schmybrids. Ethanl schmethanol. Yeah, for the sake of the press, the automakers are all showing off their alt-energy concept cars, which are promised to be on the road by 2017. But in the meantime, the real story are the trucks, because they'll actually be on the road, making money, by next year. Analysts say it's a bad time to be launching pickups, given the economy and fuel prices. Well, that's like telling a homebuilder it's a bad time to be building homes. Not really much choice, is there?

Bank of America Agrees to Purchase Countrywide Financial Corp.
The rumors are true. Expect a full day of discussion on this one: "The purchase will make Bank of America the nation's largest mortgage lender and loan servicer. This is an important advancement in the company's desire to help customers and clients meet all of their financial needs. A mortgage is one of the key foundations of many customer relationships. Countrywide will benefit from the stability of being part of the largest and one of the most financially strong financial institutions in the United States."

Countrywide Gets Rescue Deal (WSJ)
Some analysis from WSJ. Note that the sale price is actually below yesterday's overshoot close. One of those times when the "buy the rumor, sell the news" maxim actually makes a lot of sense.

Giant Write-Down Is Seen for Merrill (NYT)
The Times steps out of its element and takes a stab at predicting Merrill's writedown, which they're pegging at a cool $15 billion. We'll see how they do. Remember when the NYT was all "Chinese products are unsafe" all the time. That was a weird rut they got into.

Conoco in Lead for Abu Dhabi Deal (WSJ)
Houston-based Conoco is said to be the front runner to develop a big natural gas field in Abu Dhabi. That's good. For once we're not going over their with hat in hand, begging for some pocket change. They might actually need a US company to provide a service them. That'll reverse the flow of dollars alright.

Odds of Recession Seen Rising (WSJ)
Some folks say we're already in a recession, but that's a pretty meaningless concepts, because there seem to be some wonky rules that define what is and what isn't technically a recession. All year, they've been polling economists asking them if they think we'll see a recession and the changing responses has been very predictable. A few months ago about a quarter of them said there would be one. Then that inched up to a third. Then that inched up again. Now they're at 42 percent. This is the same as last time. During the 2000 election, Al Gore used to tout the fact that only 1 in 50 economists saw a recession. The point is, economists don't seem like the greatest forecasters. Much better to asks the folks on the ground, or the managers who run businesses, who have a much better feel. Or just go with your gut.

China Money Supply Growth Slows as Central Bank Measures Bite (Bloomberg)
This is weird. There's some evidence that Chinese monetary policy is having something of a desired effect. Money supply growth actually tapered off a little in the latest month, which is something they've been pulling for for a long time. Whether that actually accomplishes the broader goal of establishing more stable, inflation-free growth... that remains to be seen.