Opening Bell 9.8.06

Author:
Publish date:

Ebbers Told to Start 25 Years in Prison on Sept. 26 (Washington Post)
Worldcom's Bernie Ebbers has been ordered to prison, starting in just over two weeks. This is the point that reality really has to be sinking in for the guy. He's probably already felt jealous of Ken Lay at some point. The sentencing judge recommended that Ebbers be sent to the correctional facility in Yazoo City Miss. We could be wrong, but isn't this the same place that they went to in My Cousin Vinny?! Wasn't the sack-of-suds convenience store in that town? Ebbers must be kicking himself for not having a wisecracking lawyer like Joe Pesci defend him. Couldn't have turned out worse than his existing council. Of course, the 25-year sentence seems like a de facto life sentence; he's not exactly a 'yout' anymore.
Northwest recalling 1,131 laid-off flight attendants to work (Detroit Free Press)
You don't here a story like this very often. You'll recall that a few weeks ago, Northwest landed in hot water for a "guide to being laid off" handbook, that it was giving to workers. The guide had some priceless gems like, "don't be hesitant to pull stuff out of a dumpster if it looks appealing to you"... stuff like that. Well, at least for now, the airline wants a take back with respect to 1,131 laid-off flight attendants, as it's asked the workers to return to their jobs. The company is doing it out of fear that its remaining flight attendants might engage in periodic walk offs. Not only will this cushion the blow, should they suffer a quick labor shortage, but it may also make any potential strikers feel guilty. Who wants to go on strike, when there's a living breathing reminder, standing right next to you, of the fact that you're lucky to have this job. And if one of the laid off workers wants to beat up a striker, we wouldn't be surprised at all.
No sponsor for proposed Lay bill (Houston Chronicle)
Long after Enron's collapse, people who had no connection to the story whatsoever found it in themselves to bring out great anger against the company. A lot of people just hated Ken Lay, as if he had done something to them personally. But maybe, with his "death", that's beginning to pass. Nobody in the Congress has been willing to step up and sponsor a law that would stop his conviction being vacated. And it's an election year; you'd think some Democrat in need of a boost would would want to be the one to stick it to a dead Ken Lay. Apparently not.
New Fed Chairman Hopes to Downplay Impact of His Words (WSJ)
The cult of personality, when it comes to fed chiefs, really is a little much. The chairman can't even engage in a little innocent flirting with Maria Bartiromo without causing an international financial crisis. So it's a noble goal that Ben Bernanke wants to "depersonalize" the Fed, i.e. make it less about him. Unlike Greenspan, Bernanke talks last at meetings, so that the other members of the board don't feel compelled to agree with him. Maybe he just knows that he can never be "The Wise One", and wants to get the burden off of his shoulders early.


The Oil Drum debate, round one (VentureBeat)
Well Known Silicon Valley venture capitalist Vinod Khosla has become a major advocate of ethanol, and is promoting and investing in new technologies to exploit it as a more efficient energy source. He's also lobbied for more subsidies for the corn-based fuel, which isn't much of a surprise, considering his stake in its future. Recently, he ventured onto the blog the Oil Drum, a popular site where people scream their heads off about peak oil and topics like that, but where ethanol is not thought of too highly. VentureBeat has a good roundup of the debate, and concluded the Vinod Khosla may have fallen behind on a few facts, he made a good "moral" argument for finding an oil alternative. Ultimately though, having to rely on a moral argument, as opposed to an economic/scientific one, does seem like a loss, since moral arguments can be so flexible.
Bank of Japan Leaves Rates Unchanged (AP)
While the US has to go through the long "17 and done" or deal, that spend the end of the Greenspan era and the beginning of the Bernanke one, Japan's tightening cycle went much quicker. Back in July, the BOJ raised its overnight rates for the first time since the year 2000, amid the first subtle signs of price creep, and some sustained economic strength. But they're not going crazy; the BOJ has decided to hold rates unchanged, noting that the inflation picture doesn't look all that bad. In the next 100 years, we'll never see Japan do a series of 17 straight rate hike; just a guess.
U.S. Takes Aim at Banks Controlled by Tehran (WSJ)
The Journal is a bunch of treasonous traitors! How dare they discuss the fact that the US is intervening in international banks to stem the flow of money and technology into Iran!
News Corp. Provides Murdoch A $50,000-a-Month Residence (WSJ)
Hmm, when did the Wall St. Journal morph into footnoted.org? Turns out that while Rupert Murdoch's primary residence is being renovated, News Corp. is footing the bill for his $50,000/month Park Ave penthouse rental. And here's the real scandal, in addition to the 50k, they're also paying is $500/month utility bill -- though Murdoch has assured the company that that will come down after the summer months, when he can stop running the air conditioner. Not surprising, the corporate governance experts at ISS are having a conniption. Yo, lighten up, it's called perks. It's not just CEOs who get them either. Another problem is that the landlord doesn't know who to collect the rent from, and Murdoch has to frequently phone back to the company, "Dudes, the landlord is PO'd, he really needs the rent, it'sl ike 4 days overdue".

Related