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Opening Bell: 5.9.07

Realtor group predicts sales dip (Chicago Tribune)
Finally, after months and months of bad news, the ever-optimistic National Association of Realtors has lowered its forecast for housing sales in the coming year. This is a big deal, because the NAR has been the symbol of unmitigated optimism throughout the broader downturn in the housing economy. To hear the NAR and the company's kept economists put it, there's never been any sign of a slowdown, and to suggest as such is absurd, if not dangerous. It's even predicting a price drop. Excuse while we step away and throw cold water on our face so we can continue writing the rest of this piece.
U.S. Growth Outlook Dims as Consumer Spending Slows (Bloomberg)
No, seriously, this time the US consumer is done for. Sure, we've said it in the past, but this time we really mean it. No, hear us out, for real. You've got high gas prices (sure we've had them before, but keep paying attention), enormous personal debt (shut up) and the end of the household ATM (aha!), all of which are conspiring with a deteriorating jobs picture (don't ask) to rob consumers of their six-pack and HDTV money. In light of all these things, economists have trimmed their growth picture across the board by %0.2.
Private-Equity Groups Form to Chase Alltel (WSJ)
Wireless carrier Alltel is said to be on the radar of a number of private equity firms. They're very much attracted to the company's low debt level (it produces as much free cash flow each year as it has debt), but they're a little turned off by the richness of the company's shares (apparently the public market is no slouch in valuing the company). So, firms remain cautiously interested. As for the interested parties, it's pretty much everyone you'd expect. No surprising omissions or additions.
Hedge Fund Urges Alcoa to Be Prey, Not Predator (Dealbook)
A hedge fund with a stake in Alcoa is encouraging the company to drop its bid for Alcan so that it can be bought out itself. There's speculation that either BHP Billiton or Rio Tinto could be interested in Alcoa (it is so last summer), but that it would be tough to swallow Alcoa and Alcan. It's hard to imagine, at this point, that management will heed the letter. it's interesting to note, however, that when the news was announced on Monday, shares of Alcoa turned in solid gains, which is a bit odd anytime a company announces a huge purchase. Either the market really likes the Alcan purchase (possible), or investors are so roundly optimistic that they're convinced that any deal will work out as planned (more likely).

Now for the hard part: Reuters woos bid support (FT Alphaville)
What is up with news organizations that they can't just be like normal companies. You can't just pay a lot of money to buy them. You have to convince some founding family, which includes some decrepit curmudgeons and probably some Brooklyn hipsters with trust funds to let go of their prize possession. Same deal with Reuters. It wants to sell out, but because of its structure, it has to convince some independent groups that "guard its editorial independence" to let it go. What a crock. Apparently, traders see significant uncertainty as to whether the deal will go through.
Contaminated meal fed to local hatchery fish (Mail Tribune)
The poison that's found it's way into pet food and pig feed has now wound up in fish hatcheries, potentially tainting fish eaten all over the country. The word is that the levels of poison probably wouldn't be high enough to affect any second generation consumers (i.e. humans that eat the fish), but it's still a discomfiting thought. What's weird is that the fish were being fed wheat gluten in the first place. Seems like an odd choice of food for fish.
GM joins green group (Detroit Free Press)
GM has joined a group devoted to reducing greenhouse gas emissions by 60% by the year 2050. Seems like a safe group for the company to join, since few people would actually expect to be around in 2050. Actually, most hardcore environmentalists probably don't expect the earth to be around by 2050, so the company is covered on all fronts.
Cisco Shares Fall as Sales Forecast Misses Estimates (Bloomberg)
Shares of Cisco slouched yesterday, after the company missed earnings estimates and said that US enterprise spending wasn't looking so hot. Throughout earnings season, there's been a lot of debate about enterprise spending, and whether it's strong or not. Early on (warnings season), a number of companies warned about this. Then, a number of other companies, like software firms, said they weren't seeing a problem at all. However, other than that leetle thing called the US market, Cisco is apparently "firing on all cylinders".
Look to Airbus for Clues to Sarkozy (NYT)
The TImes makes a pretty good point here, which is that we'll probably be able to get a sense of Sarkozy's free-market cred by how he handles the continuing tumult of Airbus. Let us make a prediction -- it won't be particularly pretty. As John pointed out, there's really no evidence that Sarko is much of a free marketeer, despite him being a "conservative". In Europe, left and right mean different things. It's more about tone and attitude than it is about policy. Above all, Sarkozy will remain French, which is to take pride in certain French things, like a stake in Airbus. And it would be a disgrace to France and himself if it failed under his watch. So unless things improve on their own, expect him to be hands on.