Opening Bell: 3.27.07

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Xstrata's takeover bid comes up short (Globe and Mail)
Metal Wars II is proving to be just as riveting as the original, with twists and turns on nearly a daily basis. Yesterday came word that Switzerland' Xstrata would bid for LionOre Mining International Ltd, which is based in Canada. But, initial reaction suggests the bid doesn't stand much of a chance, as it offers current investors very little premium, and thus no reason to depart with their stock. One fund manager likened the offer to theft.
GM link strong in Chrysler sale talk (Chicago Tribune)
Ever since Dr. Z suggested that Chrysler may no longer be welcome in the Daimler home, there's been plenty of talk about the fate of the unit. Some see it getting spun off; other see it going to private equity, while yet others see it being swallowed up another automaker. The latest is that GM -- the model of a thriving modern car company -- may be, or may have at one point been interested in making an offer for Chrysler. What's hilarious is the reason given by some labor analysts as the reason that GM may want Chrysler. Apparently, if the two companies merge, then GM can go to the UAW and point to redundancies and inefficiencies, which necessitate layoffs. So in other words, it may be worth it for them to make an enormous buyout, just so that it can then legally lay folks off.
Stock Bonuses at American Anger Pilots (NYT)
The CEO of Delta didn't do his section 16 compadres any favors when he opted to forgo his bonus "out of the good of the company". Over at American, pilots are upset about a mere $21 million in stock bonuses going to five top executives. Then again, maybe the Delta plan was a brilliant stroke of Machiavellian strategy. The company knew that if it made its executives look generous, executives at the competition would look like jerks, and thus foment would start to brew. We take back everything we said.
EDP to Acquire Horizon Wind of U.S. for $2.15 Billion (Bloomberg)
Goldman may have some green leanings, but it won't let that get in the way of the other green -- the money green. The firm just sold of Horizon Wind Energy LLC for $2.15 billion to Portugese utility EDP-Energias. It's not clear exactly how much Goldman made on the deal, but we're guessing it was a lot, considering the strength in these alternative enrgy companies over recent years.


Big Three, Bush bury hatchet on fuel goals (Detroit News)
President Bush met with leaders of the Big Three Detroit automakers and held a discussion with them on the most pressing issue of the day their deteriorating businesses fuel economy. Of course, they didn't really get at the meat of the subject, since the two sides have some disagreements over policy in this area (best not to talk about disagreements in the company of the President himself). Rather they talked about ethanol, which, we'd guess, was not the most substantive conversation.
Oil Trades Retreats From Three-Month High; Iran, U.K. Face Off (Bloomberg)
Iran's detention of 15 British soldiers has (allegedly) pushed to near its highest level of 2007. Just one question: is "blame the Persians" wholly different concept than "blame the Arabs", or are they related?
Industry Moves: Netflix CEO Reed Hastings Named To Microsoft Board (paidContent)
By and large, people tend to make much to big of a deal about celebrity or high-profile board appointments, like when Apple brought Google's Eric Schmidt on board, or when fledgling software company NetSuite brought on Billy "Moneyball" Bean. Actually, after the Billy Bean appointment, we half expected all the GMs in the MLB to got board spots, if not outright executive jobs. The latest tantalizing move is that Netflix founder Reed Hastings is joining the board of Microsoft. Is it meaningful in anyway? Almost certainly not. But since Hasting is well known, and it's Microsoft, it's news.
Senator faults regulators in subprime train wreck (CNNMoney)
Senator Dodd has really latched on to this whole subprime thing in hopes that it will somehow propel is flagging bid for the presidency. Obviously, that's pretty ridiculous, but you can't blame a guy for trying. The good news (for the world) is that Dodd seems to realize that criminalizing the entire mortgage industry probably won't accomplish much, rather he just wants to talk to Wall St to talk about some way to help people that might get pushed out of their homes. So if some patrician New Englander with bright white hair comes knocking at your door, don't worry, it's just Chris Dodd -- he's harmless.
Lennar 1Q Profit Falls on Soft Market (Forbes)
It's almost superfluous at this point to talk about yet another homebuilder reporting horrendous earnings, but as long as they keep filing their SEC-mandated quarterlies, then we're going to get articles about how badly they're doing. The latest is Lenna, which reported this morning that earnings plummeted precipitously, on the order of 73%. And no, it's not going to meet any sort of forward guidance either (duh).
Loan Sharks (Marginal Revolution)
Alex Tabarrok has been doing a nice job of taking it to the credit snobs, the people who are freaking out because businesses had the temerity to lend money to poor people at low rates and with few controls. He notes the changing definition of the phrase "loan shark", which has gone from meaning "a scumbag who charges the poor obscenely high rates of interest" to meaning "a scumbag who charges the poor obscenely low rates of interest". Clever.

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