Skip to main content

Opening Bell: 3.28.07

UAW chief fires first at Big Three (AP)
The head of the UAW is warning the Big Three automakers not to screw around, and not to assume that just because the union's made concessions in the past that it's in any mood to do so again. You'd gotta figure that the Union would be particularly miffed if, say, a pair of automakers tried pulling some stunt like merging, just so that they could create inefficiencies and redundancies. Still, the combative sentiment may not be shared among the rank-and-file -- you know, the ones who actually work there and aren't living on the union dues of others. Many seem to understand the weak position of the Big Three.
Merck wins another Vioxx case (AP)
The pace of Vioxx verdicts has slowed down, but you can put another biscuit in the basket for Merck, which won its 10th. A jury deliberated for six hours before deciding that Vioxx wasn't responsible for a woman's death. The score now stands: Merck 10, trial lawyers 5.
Rumors, tensions push oil $1 higher (Reuters)
Yesterday, the world got a little sneek preview of how the oil market might behave if we were to go to war with Iran. After some rumors had leaked that there had been a military clash, oil surged by $5/barrel, before settling back down once the US had denied the rumors. Still, the crude stuff did end up by $1, as the fate of a handful of British soldiers continues to hang in the balance.
Home builder under investigation by FBI (Charlotte Observer)
Beazer Homes was one of the highest high fliers there was throughout the 90s and the first half of the aughts. Then, like all of the others, it's fallen on hard times. And now it may become the poster boy for the new criminalization of mortgage lending. The feds have announced an investigation into the company for "potential fraud", including its aggressive role in securing mortgages for its customers, many of whom have now filed for foreclosure. Details seem light at this point, but it'll be interesting to see whether the company will get into trouble based on Alex Tabarrok's new definition of a loan shark, "a scumbag that lends money to poor people too cheaply."

Wal-Mart Chief Writes Off New York (NYT)
Well that sucks. Wal-Mart has decided to give up on its plan to open a location in New York, citing a long battle that ultimately just wasn't worth the effort. And with that, New York remains proudly big box-free, if you don't include K-Mart, Target and Home Depot. As if to underline the company's point, that opponents had just made it too difficult, the company's opposition among organized labor took a moment to gloat.
Break Seen in Logjam Over Trade (NYT)
One of our favorite rules of thumb is that if a law has broad, bi-partisan support, then it's probably a real stinker. The latest are some new trade rules proposed by the Dems that seek to resolve an impasse over some currently ongoing trade bills. The Democrats are insisting, of course, on rules that would put in place some guarantees for labor, as well as more stringent environmental protection. Lo and behold, the the proposals are generally viewed positively by both labor unions and the Bush administration. We're not really surprised by either, at this point.
In Tribune Horse Race, Zell Is Said to Keep the Lead (Deallbook)
Word is that billionaire same Zell maintains the lead in the bidding for the Tribune Co. and that he may be named the winner by the end of the week. Is it just us, or does it seem like Sam Zell is the only bidder for the Tribune? Apparently there are a couple of others, like Ron Burkle out in LA, but you get the impression that he just wants to own the LA Times, and that for him it's mainly an ego trip. So to say he keeps is lead doesn't mean very much, since he might be basically the only one interested in that whole heap. Good luck to him if he manages to pull out the "victory".
Food oligopolies enter "salad" market (Oligopoly Watch)
It may not be the manliest meal, but we consider ourselves to be connoisseurs of a good salad from time to time. Cobb salads are great, so are Caesars. Extra points for any salad if they incorporate endive or bacon. Still, from time to time, we do admit, we've grabbed a "bag of salad" from the produce section, although we almost always modify it in some way -- sweet peppers, hearts of palm and fresh mozzarella balls are easy ways to make even the most boring salads interesting. And so it is that the nation's food giants are aggressively entering the bagged salad space, adding all sorts of nuts and meats to the mix, in the hopes that they can capture the "healthy crowd". The health market is one that's growing pretty rapidly, so entering this market seems like a reasonable move.
ABN AMRO's open to weighing other deals (MarketWatch)
ABN AMRO is still talking with Barclays about a deal, but it said it would consider alternatives if the talks were to fall through. The company didn't specify what these alternatives might be, although there's been all that talk about Citi being interested, so presumably that's what the company is talking about. Meanwhile, a hedge fund, TCI, is pushing to get the company broken up and for it to return more money shareholders (what else?), so just in case it didn't have enough on its plate already, it's got that to deal with.