Opening Bell: 5.19.06

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Milberg Weiss Case May Resemble Arthur Andersen's, Lawyers Say (Bloomberg)
It was a shame to see Arthur Andersen go. There were thousands of lost jobs, billions in destroyed economic value, and countless hours wasted in the process. Their problems were isolated, and eventually the conviction was overturned, which only added salt to the wound. But we won't have the same sympathies should a similar fate befall the lawfirm Milberg Weiss, one of the most prolific litigators of class-action lawsuits in the country. Now the indictments have rolled in, and the allegation that they paid clients to participate in class-action lawsuits is an ugly one. The company has won more than $45 billion in awards for their clients, and it's unfortunate that no verdict would compel those clients to hand back the money to the affected firms. Should be a great story to watch, as we'll get a peek at the inner-workings of a class-action factory. Can't wait.
Leading Indicators Reinforce Idea That Growth Is Slowing (NYT)
When it rains it pours, eh? What's that word? Starts with S, ends with N... Stagflation. The latest reading of leading economic indicators points to slowing growth (the stag part), though as you would expect, Wall St.'s finest are spinning it in the most positive light possible. See, it's not the economy is getting weaker, it's that growth rates will become more sustainable. And in fact, according to the chief economist at BOA, the news is "welcome", though they'd like to see a downtick in inflation at well. Wouldn't we all, wouldn't we all.
KDDI, Google team up on mobile search (Telecom Asia)
Google's been going out and making several deals to become the official search engine at many mobile operators around the world. There's nothing wrong with it, and it makes sense for them to become the default search engine on as many different screens as possible, big and small. But wasn't Google just whining to the DOJ about how Microsoft shouldn't be allowed to have MSN be the default search engine in their forthcoming browser? Yes, they were. They said it was an anti-trust violation and that consumers deserved choice. What about the consumers at KDDI and whatever other operator, do they deserve choice too? Look out for them if they get the China Mobile deal, that's the biggest operator in the world, and could instantly give them a great position in China.
Dell to Use Chip Made by A.M.D. (NYT)
Dell finally bit the bullet and will start using AMD chips in some servers. They had been the last Intel-only house, and some had seen this as contributing to their ills. AMD chips have seen a slight edge over Intel for sometime, so customers went elsewhere looking for the top of the line. The deal only applies to servers, but now that they have a relationship, it's not hard to imagine they'll be in PCs before too long. There's no question that it's a blow to Intel, which is already reeling.


Lay-Skilling, Week Sixteen (Houston's Clear Thinkers)
We've tried to link to each one of Tom Kirkendall's weekly wrap-ups of the Enron trial, because they're non-paralleled anywhere in the press. It almost saddens us that this could be the last one. There's still Ken Lay's own trial for bank fraud, and then of course if they're found guilty, there's the appeals process. Realistically, it won't be over so soon. The Jury's away for the weekend, still with no verdict, so this is definitely a good read as you await the results. Hopefully they'll be in sometime next week.
Apple's New Store is Pure Glass (BusinessWeek)
Move over Chrysler Building, the new architectural icon of New York as arrived. Apple's flagship store, most notable for the giant glass cube gracing its entrance opens to the public today. Does it represent the beginning of the end? The ultimate act of hubris? The store is going to be open 24 hrs, so if at 3 am the battery dies on your first gen iPod, and you decide to make the plunge to a 60GB model with video, you can do so instantly, without the harrowing wait for the SoHo store to open up. Will people actually show up at 3 am? If you still don't get the Mac phenomenon, try getting into this location sometime this weekend, or if that fails (and it's likely to), at least check out the throngs of people lining to buy iPod peripherals at the SoHo store, as if they were lining up to by concert tickets. It's quite the scene.
Symantec sues Microsoft for stealing secrets (CNN Money)
While many see the Microsoft monopoly crumbling, they are still striking fear into one industry, that being computer security. Typically, Microsofty has been a great friend to the security companies as their operating systems are known to have holes that would make Swiss cheese jealous. Someone then needs to build the firewalls and patches and cleaners to rid the world of nasty viruses and spyware. But if Microsoft's forthcoming Vista lives up to some of it's promise, it may be an inherently more secure operating system, and that's scaring some top CEOs in the space. Most notable is Symantec boss John Thompson, who has been doing a lot of barking at Microsoft lately. At a conference, this week, he urged people to go Mac instead. He'd also like the government to look into -- wait for it -- anti-trust allegations against the company, for integrating deeper security into their OS. Now, the company has launched a lawsuit alleging the theft of company secrets. It's hard to know the merits of the case, at this point, but there does seem to be some element of desperation, or at least fear behind it.
A Contrarian Look at Whether U.S. Chief Executives Are Overpaid (NYT)
Those who like to complain about CEO payment, like the Times' Gretchen Morgenson who is singularly obsessed with the issue (why?), typically see their complaints as self evident. That is to say, they feel they can point to a case of a highly paid CEO, and it should be obvious to everyone that something egregious is going on. Sometimes, they'll try to make the case that it's hurting shareholders, i.e. the ones who are actually affected by this, though they risk contradicting their general thesis that CEO pay is something of a public issue. Sometimes they rely on rhetorical sleight of hand to imply that CEO pay is somehow linked to employee underpay "He walked away with a $12 million bonus, while his employees got the pink slip". Unfortunately, they can't tie the two together. So it's interesting to read about the conclusion of a new study which suggests that market forces are behind the rise in CEO pay, and that they're not paid absurdly higher here than in the rest of the world (contrary to what the Morgensons of the world would have you believe). It's definitely worth a read, if for no other reason than it's good stuff to be able to cite at dinner parties.
Mittal Steel Sweetens Offer for Arcelor (AP)
Well that didn't take long. One day after officially launching their bid, Mittal has upped the offer for Arcelor. What may be most critical about the deal is that they've altered the corporate governance picture so that Arcelor executives will have more of a role to play at the new company. That's probably a good move; at least they won't see the plan as a ticket to the unemployment line.

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