Oil Trades Near $62 in New York as Gasoline Demand May Increase (Bloomberg)
They said it, not us. You'd have to bust out Lexis-Nexis to be sure, but this article may contain the year's first mention of our favorite three-word phrase "summer driving season". That's right, they went ahead and dropped the SDS-bomb. Now get ready for it to be used every day, or at least every day that oil prices go up, and some journalist is looking for an excuse. We feel warmer already.
Prostitution Index (Free Exchange)
According to jetsetting international businessmen that frequent South America, you can really tell a lot about an economy bases on the latest happenings in the prostitution market. This is good to know. There are several factors at play here that the casual observer might not notice in a single night, but that you might notice if you were a regular. For one thing, prostitutes move from country to country, depending on where the gettings are good. It's also a counter-cyclical business, in the sense that the market sees a lot of entrants when goings are bad. If you're unsure what all this means, it means that yes, you can expense a prostitute. It's market research. Just be sure to ask a question, like, "so, are people tipping heavily these days", just to get the full value for your company.
Environmental Group Behind the TXU Deal Hires a Banker (NYT)
At first, we were a bit skeptical about the whole environmental angle to the TXU deal. Now, after further reflection, we've changed our minds a bit. Actually, we didn't change our minds until this morning when we read that the environmental group involved in the negotiations, Environmental Defense, had hired Perella Weinberg Partners to advise it. Apparently, it feels it needs a real bank to help assert its environmental demands at the negotiating table. Perhaps it feels like there might be another bid for the company, and it doesn't want to get caught without a seat at that table. Ok, so why have we changed our minds? Because when environmental groups start hiring investment banks, it's them that are selling out. In fact, we'd like all environmental groups to hire bankers, and perhaps they'd get to know the workings of capitalism a little better, and they wouldn't see everyone involved in business as rapacious pirates. So, yes, it's absurd that they've hired a bank, but if it means that next they'll start a VC fund, that's great.
Microsoft executive in charge of Live Search to leave company (AP)
In case you didn't realize, Microsoft's "Live" brand was supposed to serve as the successor to MSN, and serve as the main vehicle through which the company could compete with Google. But, there's no indication that the strategy or the brand is going anywhere. In fact, it seems to be struggling, and now a top executive within the division is heading for the doors. And in other strange Microsoft news, the company hired a top Jupiter analyst a few weeks ago to be a company evangelist. After only one week on the job, he's returning to his old post at Jupiter. He realized that he's an analyst at heart, which is a little scary.
U.S. Stock-Index Futures Rise; Citigroup, Ford Gain in Europe (Bloomberg)
We've never really known why stocks rise on speculation of takeovers (someone has to be doing the buying, right?), but rise they do. Or at least according to the writers who ascribe motives to groggy, early-morning futures traders. Yes, this morning, things are pointing higher, and the reason is takeovers.
U.S. suit: Walgreens biased (Chicago Tribune)
Someone must've messed up in the copy editing. Surely this story meant to say that Wal-Mart is biased. Either that or the employees sued the wrong company for discrimination. We'll update this when we learn the truth.
D.R. Horton CEO: '2007 is going to suck' (Reuters)
If you're investing in homebuilders, you might want to keep hitting the snooze button for the next several months. The CEO of DR Horton is making it pretty plain. 2007 is going to suck. No real mystery, it sounds like pretty much more of the same. Not too many homes are going to be sold, and the price they are sold for is going to be weak. And whatever profits the company is going to make will be canceled out by big writeoffs on all the land they've spent so much on in recent years.
In Europe, Germany May Have to Take the Wheel in Going Green (NYT)
We don't usually think of the Germans as leaders when it comes to environmental issues. Our image of the stereotypical German worker involves hard hats and a face covered with soot. Furthermore, it's a car country. Now the Angela Merkel government is looking to take on the auto industry, and push it to adopt more environmentally friendly practices. Of course, the German economy is in the midst of an impressive rebound so business leaders must be a little concerned about all this talk about reducing emissions. In the bigger picture, it's not even clear that some emissions cuts out of Germany could ever really have a global impact, particularly when there's no emissions abatement going on in Asia or the US. So why hamstring the local economy, just to prove a point?
3i’s infrastructure fund raises £700m (FT Alphaville)
Is Infrastructure mania petering out? Investments in infrastructure (roads, tollways, ports, water works, airports), have been hot, hot, hot over the last few years. Every bank has been trying to do this, following the lead of Australia's Macquarie, which has made a mint on these investments. 3i has floated a new infrastructure fund, raising £700m, which is not an unimpressive haul. In fact, it makes it the biggest such IPO in Europe. That being said, it priced at the very bottom of the range. The company is saying they're still happy and all, and that the prices of these things hare hard to predict.