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Opening Bell: 5.11.07

Costco bucks trend among major retailers: sales were up in April (Seattle Post-Intelligencer)
The market got pretty banged up yesterday, supposedly on account of some punk retail sales (so we're told). It's odd, didn't investors see the memo that it was all the result of an early Easter? One company that did perform well was Costco. That's because in the areas it operates, Easter was its normal time. It might also have to do with the fact that Costco is the one retailer that rich folks will be caught dead in, which explains why why it did a brisk business in expensive objects, like TVs.
China Eases Investment Caps, Lets Banks Buy Overseas (Bloomberg)
It's obvious that China is pretty freaked out by its bubbleicious stock market. It's been trying for years to cool things down, but nothing's come even close to working. Now it's lifting regulations that prevent local banks from investing in overseas stock markets. The thinking is pretty obvious, that if banks can invest in Japan, the US and Europe, they won't pump money into China stock quite so hard. This is in some ways a pretty big step, at least symbolically. That being said, if China's past track record with cooling mechanisms is anything to go by, don't expect this to produce the much-desired soft landing.
Effects of Thomson-Reuters on Dow Jones Newswires (PaidContent)
There are a lot things up in the air right now. Other than the continuing dominance of the 'Breaker, you can be pretty sure that the financial media landscape will look somewhat if not significantly different a year from now. Or maybe it'll be exactly the same, but then that too would be unexpected. One question is on the future of financial newswires. Dow Jones Newswires is getting hit by a double whammy right now, as its parent company may get bought out, while two of its chief rivals ponder a merger. At the moment, DJN distributes its articles via Reuters and Thomson, but that outlet has to be a little shaky in light of the latest events.
Stop Fleecing Poor Americans (BusinessWeek)
This is cool, BusinessWeek is holding a debate between Tyler Cowen and local hero Nouriel Roubini on the subject of payday loans. Unfortunately, Roubini takes the "pro" side, as in "yes, stop fleecing poor Americans", which means we've really got to side with Tyler, who disagrees with the statement, saying that we have to treat all borrowers like adults. Not surprisingly, given the publication, it's a real short "debate", unlike the Econoblog debates held by the WSJ from time to time. Still, Roubini manages to conflate payday loans with the subprime meltdown, as he's done before. One of Tyler's sharp responses is that for desperate people, the alternative to payday loans are (illegal) loan sharks and gambling, which presumably would be much worse.

Strike One, You're Out (Digital Rules)
Yesterday, jetBlue founder and CEO was ousted from his company because its stock has done nothing for four years. It was probably time to go, but as Rich Karlgaard points out (and we agree), it's always with a tinge of melancholy that you see a founding CEO get the boot. It's his goddamn company, he should be able to do whatever he wants. Well, it actually sounded like he was read to move on, too. At leas they're not suing him, as has happened to some other founders. That would be a slap in the face.
Workarounds may fix calling service (Bloomberg)
Vonage has been rather inconsistent on the subject of workarounds, as it tries to continue operating without infringing on Verizon's patents. At first, it quickly promised that it would have some workarounds. Then, a couple of weeks later, it said that there were none -- that it would basically be impossible. And now, in its latest quarterly announcement, it suggested that it might have some after all. So you can understand if investors are confused. That being said, its patent troubles are in some way the least of its problems. The real issue is that the company's operations are performing miserably. In fact, the company would probably prefer that you pay attention to the patent case, and not actually look into its results.
Obama, Clinton, Edwards Back Measure Curbing Executive Pay (Bloomberg)
Barack Obama has introduced a measure in the Senate that would let shareholders of public companies take a non-binding vote on executive pay. A similar measure already passed in the house. Just to give you an idea of where things stand on the Democratic side, all of the party's major candidates quickly endorsed the measure -- John Edwards said it was a needed, since, "We now have the greatest income inequality since the Great Depression". His words.
Bush and Democrats in Accord on Trade Deals (NYT)
If you're a free trader, it's impossible to imagine a scarier headline than that.
Panel to Look at Conflicts in Consulting (NYT)
And just to complete the trifecta of lovely political news, a House panel is looking at the issue of conflicts of interests among executive pay consultants. Great. Hey, guess who wrote this article? Hint, it starts with G.
Orbitz, the worst IPO of 2007? (GigaOM)
So Orbitz is coming public again, and Keven Kelleher at GigaOM has nominated it as a candidate for the worst IPO of 2007. The list of charges include opaque financials, a continuous see of red ink and a lack of voting rights for public shareholders. Also, the IPO money won't go to improving Orbitz' operations, but rather it will go to paying down the parent company's debt. Ok, so maybe all that doesn't sound so hot. But hey, that's the world of private equity we live in. Orbitz is kinda par for the course in terms of companies that have been taken private and then public again. so while it may not be high on your list, it's probably not the worst either.