Opening Bell: 11.22.06

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Qantas Approached by Macquarie Bank, Texas Pacific (Bloomberg)
Blue Horseshoe Loves Qantas Airways. In a rare move, Australian Bank Macquarie and Texas Pacific have made an offer to take Qantas private. Qantas has a long history, dating back to 1920, and is currently on a 13 year streak of profits, as it's withstood many of the industry's slumps. The offering price $7.6 billion represents a 15% premium over its last closing price. Of course, the move worries politicians, who think that Macquarie is going to pull a Gordon Gekko, by gutting it, laying off staff, and other cost-cutting measures. To some extent, they're probably right, otherwise they'd have a hard time justifying the offer.
Dell Shares May Rise After Profit Exceeds Analysts' Estimates (Bloomberg)
Here's something for Yahoo to aspire to. The second most hated tech company of the year, Dell, put in solid numbers yesterday evening, coming in well above analyst expectations. Everything looked good, from revenue to gross margins. Of course, a lot of issues still hang over the company, like it's accounting review, and questions about its business model. But at least for a day, we'll let it relive its glory days.
White House cuts economic growth forecast (Reuters)
It's not like the White House has a crystal ball, or anything like that, but they're as entitled as anyone else to put out an economic growth forecast. Yesterday, they came out with their 2007 numbers, and had to trim the outlook below analyst expectations based on headwinds from housing and inflation. On the conference call with investors, the White House said it remained very positive on the economy, and that the underlying market looked good. They noted that management salaries were tied to performance, so investors could rest assured that they had their skin in the game.
Fighting for Middle America (Houston Chronicle)
We swear we'd love to wait until after Thanksgiving to start talking about retail sales (God, writing this is going to be so miserable for the next month), but the media won't cooperate, as it really wants to start talking about 'em now. Perhaps the most neglected segment of the buying public is the middle class, which doesn't get nearly as much attention as the rich and the lower-income folks do. But, somewhere between Wal-Mart and Neimann Marcus are the Kohlses and Penneys, which, well, sell decent items at decent prices. Nothing real fancy, nothing real chip. Just nice and middle. And the key to winning in this segment this year, is to really nail the exact middle. Best of luck to 'em.


BHP Billiton could make bid for Freeport, Credit Suisse says (MarketWatch)
We've seen a lot of deals lately where company A buys company B, which then makes it attractive to company C, since it can acquire both of them in one shot. So analysts are talking up the possibility that mining giant BHP Billiton could make a play for Freeport McMoRan once its purchase of Phelps Dodge is complete. Or perhaps it will start the bidding even before that merger goes through, though that might make things tricky. Or it might not do anything at all. The only weird thing is that for the most part, all the dealing remains 'friendly', which is pretty odd giving the recent history of this market, which has been characterized by hostility.
Newsflash: University Presidents Make Good Money (Organizations and Markets)
Dear Gretchen Morgenson, it doesn't seem like you'll ever get bored of writing about CEO pay, but just in case you do, we've found the next scandal for you to delve into: the pay of university presidents. Pay is way up, and new modes of pay like performance pay are increasingly in vogue. We can only imagine the kind of shenanigans that university presidents engage into boost their performance numbers. Oh and of course, the rate of growth far outstrips the average worker.
In China, Growth at Whose Cost? (WSJ)
A new study finds that while China's economy looks like it's booming, the poor are failing to keep pace, leaving some to wonder about the sustainability of the Chinese economic miracle. In one sense, there's bound to be a widening of the income gap when an economy starts to hum for the first time. Just the existence of a new class of wealthy people will, by definition, increase income gaps. But the study says that the wages of the poor have actually fallen, which is a bit surprising. Nobody seems to have a good explanation, which makes you wonder whether it's just number tricks. After all, wages have supposedly been stagnant here for years, but most people are far better off than they were 10 years ago, at least in material terms.

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