GM to Take $39B Noncash Charge (AP)
GM said after the bell yesterday that it would take a $39 billion non-cash charge associated with some deferred tax mumbo-jumbo. But don't fear, it was non-cash! Whatever, either the company lost $39 billion or it didn't. Yesterday, there was some asset, whatever it was, which was valued at $39 billion more than it is now. If you had a building worth $39 billion and it imploded, you wouldn't say it was no big deal cause it was non-cash. Regardless, the episode confirms what we've suspected for awhile, that any return to profitability that the company has seen is probably total fiction.
Microsoft Fires Information Chief for Violations (Bloomberg)
Ooh, mysterious, Microsoft has canned its CIO over unspecified violations of company policies. Naturally, folks are joking about this, like maybe he used a Mac whatever. But 'Breaker readers are more clever than that, and smarter, so if you have any real guesses, we'd love for you to throw 'em out there. Otherwise, we'll just have to wait until the truth outs itself, but what would be the fun in that.
Oil Rises to Record as BP, Conoco Evacuate North Sea Platforms (Bloomberg)
Ok, so we're still a little skeptical about global warming and whatnot, but there is a certain cosmic poetry to deep sea oil drillers being forced to abandon their platforms because waves are too high. Ultimately, the world is always in balance. Once the polar ice caps melt, all deep sea drilling will have to halt, meaning oil will disappear as an energy source and greenhouse gas emissions will cease, reversing global warming and refreezing the ice caps. Good to know it'll all work out.
Bancrofts Bicker, Miss a Deadline, Lose Board Choice (WSJ)
If you're like us, you usually have a harder time making small decisions than big ones. See, with big decisions, there's usually a lot to weigh.. a lot to chew on. With small decisions, there's usually a lot less to work with. Anyway, the Journal has a bit of an odd story about the Bancroft's failing to select a family member to the News Corp. board in a timely fashion. So they missed the deadline and Rupert Murdoch imposed some discpline on the fam... ultimatly resulting in the choice of Natalie Bancroft, a 27-year old opera singer. We haven't found a MySpace profile for her yet, though this could be her LinkedIn.
Alibaba.com Stock Falls 10 Percent (AP)
The bubble is pierced! On its second day of trading, Alibaba.com slid ten percent, which has to be an unheard of move for any Chinese internet company, especially in this day and age. Meanwhile, BusinessWeek takes a look at the rest of the Alibaba Group, particularly its eBay and PayPal-like divisions. There's been talk that this will be huge too, with IPOs coming down the road, easily turning chairman Jack Ma into one of the world's richest. Also to benefit is Yahoo of course, which owns a 40 percent stake in the group.
Bush’s Import-Safety Plan Is Detailed (NYT)
Usually, the things that politicians do with "bi-partisan support" are the most fascist things. That's just how it seems to be. Bush has detailed his plan to keep us all free from lead-tainted Chinese train sets, and even representatives of consumer groups are pleased. The new plan calls for more thorough testing, particularly of high risk items (e.g. toy train sets), though manufacturers could undergo certification to avoid the most rigorous inspections. sounds like our strategy for airport security, which has proven to work out well.
Toyota reports first-half net up 21%, raises forecast (MarketWatch)
Meanwhile, this should help douse some of the nonsense about GM gaining at Toyota's expense. Here's a company with real earnings and results that makes sense. Miraculously, the company's profits actually bear some relevance to its operations. Money flows down from the top to the bottom, with straightforward subtractions for actual costs. Seriously, check it out for yourself. What a novel concept.
Calls Rise To Oust Beazer CEO (Forbes)
A lot of CEOs are going to be kicked to the curb before this whole subprime mess is over. An investment advisory group seems to be making a pretty good case for Beazer CEO Ian McCarthy, citing a number of moves on the border of legality. Of course, the real reason is that Beazer, like everyone is in the industry, is hurting like hell. Go back a few years, when things were great, and you probably wouldn't be hearing complaints about sale-leaseback transactions or his big pay package. Obviously. Still, we wonder whether we're missing a lesson here. Just as every trader isn't a genius because they happen to be in a bull market, every CEO can't be a crook or a moron just because things are going rough.