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Opening Bell: 5.26.06

Ford to Pay 10.6 Percent Yield in U.S. Debt Exchange (Bloomberg)
Psst... want some high-yield corporate paper? If so, Ford is offering over 10% in a new bond offering. It's a bold move for a company, and strategically probably a wise one. The company is in a high-leverage situation here (remember, people keep referring to auto stocks as options anyway) and since they have to survive now, it makes sense for them to give it everything they've got, not necessarily preserver for a future they won't have. It's like when you're down 3-1 in the World Series and your ace is rested. You don't bench him because you're worried about who you're gonna pitch in game six. You worry about that in game six. So Ford is saving its cash now, deferring some payments, and devoting their resources (they claim) to developing some hot new cars which will go toe-to-toe with the Japanese. Sounds exciting. When the cash is owed down the line, they'll worry about that then.
Phone Tax Laid to Rest at Age 108 (NYT)
There really should be a law that requires all laws to sunset after 10 years and disappear if not renewed. Yes, this does get into a college-philosophy dilemma; but does that law sunset too? Nevertheless, the phone tax, as you know, was initially passed 108 years ago to help pay for the Spanish-American War, which ended after a few months. Even though the war finished up sometime ago, the congress -- surprise surprise -- never got around to repealing the tax. Hey, would you? But now they're even repealing the tax retroactively, so if you go through all of your bills, and figure out how much you paid over the last three years, there will be a place to indicate that on your 2006 tax return. You might get as much as $50 back. Awesome. Of course, it's not really a tax cut without an equivalent spending cut, but...
Arcelor Plans $1.59B Merger With Severstal (AP)
Arcelor was supposed to be spending this week mulling over the Mittal buyout offer. Apparently, that's not all that was going on behind closed doors, the company found the time to negotiate and agree on its own merger with Russian steel concern Severstal. And in case there was any doubt, this would seem to be their answer to Mittal, nyet. This isn't the first defensive merger they've announced though, since Mittal's initial offer. Who's to say that this won't make them more attractive, as it only means the combined company will be larger?
Fed May Be Less Concerned With Wage Inflation After Pay Data (Bloomberg)
The market may find relief (or even cheer) in surprisingly "benign" wage data. In other words, at least according to the official measure of statistics, wages aren't going up very fast. The market can take comfort too, in some evidence that the economy is slowing (yesterday's GDP number notwithstanding). But not too mention the obvious fact, that none of these statistics are, you know, good, it's not like the Fed's rate hikes have really been damaging to the market. All that stuff about not fighting the Fed has to be thrown out the window, or will at least need revision, when this chapter of the market comes to a close.

MasterCard rises 18 pct in market debut (Reuters)
Well, the IPO market saw the whites of MasterCard's eyes and sent the stock up solidly in its debut as a public company. It was quite a contrast to the drubbing the market gave Vonage over the last two days, which we've covered quite extensively. Even though the two IPOs were completely unrelated, in some ways Vonage may have had an impact on the MasterCard offering. MasterCard's CEO claims that they intentionally priced the deal low out of concern about the market's volatility and weakness of late. No doubt that on Wednesday night, they saw what happened to Vonage shares Yet another market for lemons.
Dell to Preinstall Google Software (BetaNews)
Remember when Google complained that it wasn't fair for Microsoft to make its own search engine the default in the new Internet Explorer? They didn't say the reason was because (the obvious) that it hurt Google, but that it hurt consumers, whose choice was limited. It was obviously a cynical ploy to begin with (one that backfired in the court of opinion, and failed legally), but now they continue their drive to put themselves on computers before it even comes out of the box. Already, Google had a deal with Dell to make browsers open to a Google page by default, now some of Google's desktop software will come with the computer automatically. There's nothing wrong with the deal, but bidding on consumers' disk space doesn't seem to befit the company's rhetoric.
Controversy about our "Web 2.0" service mark (O'Reilly Radar)
This is just dumb, though amusing. So over on the absurd coast, as you may know the new 'net startups continue to use the moniker of Web 2.0, which has some utopian goals related to sharing, open-source, the wisdom of crowds, etc. The movement comes with its own brand of techno-theorists who are as impenetrable in their wisdom as French post-modernists. Well, guess what, the company that put on the first Web 2.0 conference, O'Reilly publishing, has the term trademarked and sent a cease and desist to a European conference that wished to use Web 2.0 in its title. After outcry from, well, the community, they've retracted the C&D, for now, though they stand by the trademark. Granted, they weren't wrong to copyright the term, but it's certainly upsetting a lot of movement people.
Lay-Skilling, Week Seventeen (Houston's Clear Thinkers)
We've linked to every weekly wrapup of the Lay-Skilling trial, and it's likely that this will be the last one barring any fireworks in the appeals process. And of course if either one of them tries to flee the country or walks drunk around the Upper West Side, we'll probably be on that too. According to attorney Tom Kirkendall, who followed the case better than anyone (name a journalist who read the entire transcript), the defense's case might have deteriorated during Lay's cross examination, when he was asked about drawing down the company's credit line. In the face of the imminent bankruptcy, the moved looked awful. Definitely, the whole thing is worth a read, and then we promise, only gossipy stuff from now on.