Judge rules tobacco firms lied (MarketWatch)
It's weird to go to sleep in 2006 and wake up 1996, or even 1986, but it happens from time to time. Who knew there was a major racketeering case against big tobacco being pushed by the Feds? And who gets charged for racketeering anymore? The case was seeking $10 billion to go to, of course, anti-smoking campaigns. The judge stopped short of requiring the companies to pay out damages, but is requiring them to admit they lied about the whole "low tar" thing. Man, tar, haven't heard about that in awhile. The companies will also have to indicate that, get this, cigarettes are addictive. Glad we cleared that up. Ok, gotta jump in a phone booth real quick to get back to 2006.
Pension law to usher in 401(k) era (Boston Globe)
Uh-oh. That little jaunt in the phone booth must not have gotten us back; still stuck in the 90s. Now, they're talking about the 401(k) era, and how all stripes of workers will embrace these newfangled individual accounts as opposed to traditional pensions. Well, as long as we're here, here's a valuable message from the future: Nobody likes it when you talk about your 401(k) at a party; as tempting as it is to have whole discussions about benefits and retirement accounts and how much paid leave you get, it's really boring. Just a tip, because in the future a lot of people will make that mistake.
Big drop in profit for Gap; S.F. retailer lowers earnings forecast for the year ahead (San Francisco Chronicle)
Ah, it's good to be back! Unlike in previous decades, the Gap continues to sag. That's not surprising seeing as the company has basically let itself become the official store of Mom Jeans. The company long ago failed to realize that brands experience natural entropy over time, and to reverse that you really have to sex it up a la Abercrombie. But if the Gap ever tries to re-invent itself, like Abercrombie, that's going to be really, really wrong.
Ryanair in security 'ultimatum' (The Guardian)
Yesterday we noted that a group of airlines were considering a lawsuit to get compensation for all the lost business caused by the drastic security measures imposed in Europe. Turns out at least one of them, Ryanair, is really playing hardball (and we like it). The company has given the government seven days to return security to normal levels, and if the government does that, the company promises not to see. That's an honest threat: do this or we'll sue; you have seven days. As CEO Michael O'Leary put it: If they don't, and if they allow these restrictions to stay in place, then the Government will have handed the extremists an enormous PR victory. It'd be nice to hear fresh talk like that out of some US chiefs some time.
Merck Suffers a Pair of Setbacks Over Vioxx (NYT)
Just last week, Merck was getting praised left and right about their decision to fight the Vioxx lawsuits on a case-by-case basis. It was racking up a solid winning percentage, and with each win, more potential plaintiffs would drop out. Well, that was last week. Now people are questioning the strategy as the company has lost 2 quick decisions. One former FBI worker -- who didn't even die -- won $50 million in damages for having a heart attack while on Vioxx. Now, we highly recommend clicking the link on this story just to see the associated picture that the Times is running. It's a classic. Of all the people in the picture, who has the most ridiculously oversized grin? Yup, the plaintiffs lawyer. Meanwhile, the plaintiff and his wife almost seem like their smiling just to keep up, and not look awkward. Great stuff.
China hikes benchmark rates by 0.27% (MarketWatch)
There's something just adorable about the fact that China raised interest rates by friggin' 27 basis points. We'll know they've become a fully advanced nation when they get the memo that interest rates are adjusted in 25 point increments, not 27. The move advances the 1-year lending rate to %6.12, as the government hopes to cool the overheating economy.
Iraq Struggles With Fuel Crisis (WSJ)
The rebuilding of Iraq was supposed to be cheap, because they were going to use their own oil money to rebuild the national infrastructure. But, like everything we initially thought about the Iraq war, not so much. Instead the country is spending hundreds of millions on importing oil and gas amid terrible shortages. And guess what, this government that we installed doesn't seem to get the whole free markets thing. There's an artificial price cap, holding the official gallon of gas at $.64. Meanwhile, on the black market, a gallon sells for around $4.92. No wonder there's a shortage.
BHP Shuts World's Biggest Copper Mine After Blockade (Bloomberg)
As if the copper world needed any more excitement, the world's largest single mine has been shut down as striking workers in Chile have blockaded the Escondida mine. The workers want 40% higher pay, and have been on strike for 12 days. And by shutting down the mine, the price of copper spirals further yet, meaning more copper related street crime. But, think of the plus side. If you see someone climbing into your window at night now, they're probably just doing it to steal copper coils out of your air conditioner to sell at a scrap yard. You're safe; go back to sleep.