Opening Bell: 2.20.07

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Sirius Purchase of Rival XM Faces Regulatory Scrutiny (Bloomberg)
Now that the long-awaited merger between XM and Sirius has finally been announced, attention turns to the question: will it actually happen? Undoubtedly, the companies are going to face significant regulatory hurdles, as the only two competitors in the market look to become one. Of course, they have a good defense. Their market is not a market of two companies, as they compete against terrestrial radio, iPods, HD radio, etc. Still, there's no guarantee that the FCC will take such an open view of their market. Amusingly, the regular radio stations are already out opposing the deal, arguing that any industry that makes Howard Stern its poster boy shouldn't receive any concessions from the government. One thing we can be pretty sure about is this: the merger of XM and Sirius probably won't bring about any broadline deregulation of the communications industry a la Citibank/Travelers and the financial industry.
Chrysler, GM deal would hit area hard (Detroit News)
What's good for Detroit is bad for Detroit. If Chrysler and GM were to merge their operation, as many are speculating, the companies would almost certainly lay off a lot of people in Detroit. Otherwise, what's the point? You have to feel most sorry for the people that were offered salary buyout offers, but didn't take them.
Airlines struggle to keep 'em happy (Chicago Tribune)
Having been in the eye of the storm this weekend, when the operations of jetBlue totally melted down, we can say that the most ironic moment came when we finally boarded the plane, 12 hours late, and turned the seatback TV to Fox News. It just so happened to be Bill O'Reilly time, and what was he talking about? Yup, he was outraged at jetBlue for treating its customers like chattel and was jumping up and down for a travellers bill of rights, as well as more class-action lawsuits against the airlines. Ah Bill, how funny that it's your soothing voice speaking directly to our problems at this moment. Of course, Bill is typically no friend of class-action lawsuits, but in this case, he can make an exception. Later on in the flight we caught Glenn Beck, the token CNN conservative making basically the same point. So with the Democrats in office, and the Republicans having turned to populists, it's hard to imagine that we won't see some major sweeping regulations that will primarily add costs to the airlines.
Wal-Mart picks sites for stores (Bloomberg)
Wal-Mart continues to demonstrate a high level of PR brilliance. The company has already put itself on the "right" side of issues like global warming and the minimum wage, as it blunts the constant criticisms against its business. Now the company has announced that it will open stores in several sites where there's a high level of unemployment, so that the stores will represent "jobs and opportunity zones". And the company will also start building locations on environmentally distressed properties as well as abandoned malls, so as to reduce the company's ecological footprint.


E-Trade offers direct access to six foreign markets (MarketWatch)
We don't really spend much time talking about the "retail investor" here; after all the whole concept is a little bit silly. Just look at the retail investor's guru, Jim Cramer. But, foriegn markets need to be warned about the coming onslaught of American at-home investors. ("honey, I was thinking about buying some shares in Samsung, what do you think?..."Sorry, didn't catch that, could you take the casserole out in 20 minutes?") E-Trade E*Trade has announced that its customers will now be able to trade stocks online in six foreign markets, including the Tokyo Stock Exchange, and they will be able to trade through a broker in 36 more. For awhile, it's easy to see some people switching over to the online broker, but it can't be long before others follow suit.
Strong global growth boosts profits at S&N (Guardian Unlimited)
UK brewer Scottish & Newcastle, the maker of college student favorite Newscastle Ale, announced strong profits in its most recent period. But, the company warned that its UK volumes will be negatively impacted when a smoking ban comes into force in pubs this summer. It's not clear that the ban spells huge problems though. Some of the pub chains think that it won't have a major effect on their business. Others think it will be a slight plus. Either way, the company is preparing for this inevitability by expanding globally -- although the smoking ban forces are expanding at a rapid pace as well.
Guilt-Free Pollution. Or Is It? (NYT)
The Times has an interesting article about the booming popularity of carbon offsets. Basically, people who are wracked with guilt about the tons of CO2 they contribute to the atmosphere, through driving and flying on planes, can buy offsets in the form of trees (which suck CO2 out from the air). This allows them to maintain their lifestyle while sill respecting the earth feeling superior to others. Of course, and we're happy that the TImes points this out, there's big problems with planting trees for this purpose. For one thing, trees can be environmentally damaging (now there's something to wrap your mind around), particularly if they're non-native, and they suck up a lot of water/erode the soil. Furthermore, the companies that plant them have had to battle against, get this, indigenous people, who claim property rights on some of this land. How un-PC is that? But, if you're a guilt-laden New Yorker, who just has to feel better about your use of the NetJets card, here's one way you can sleep better at night.
Soaring Energy Use Puts Oil Squeeze on Iran (WSJ)
Looks like the Persians will be first in line to buy some carbon offsets. Iran is finding that it has less and less oil to export, now that its population has become infatuated with cars and other energy-sucking luxuries. The other dynamic going on here is that Iran doesn't have a very modern oil infrastructure, and despite all of the dirty stuff that it has in the ground, the company isn't very good at taking it out. This is why the country might have a benign interest in nuclear energy. Sure, it scares the west, but it could also help ease the country's own energy squeeze.

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