Opening Bell: 11.9.07

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Merck May Pay About $5 Billion to Resolve Vioxx Cases (Bloomberg)
Merck has been dominating the competition in court over Vioxx, chalking up win over win, with an excellently executed divide-and-conquer legal strategy. Still, the company probably faces a legal backlog of 50 years, which, even if not resulting in damages, is resulting in high legal expenses. So word is that the company may pay $5 billion one time to settle the lion's share of the lawsuits. You'd have to run the math on how this compares to its current strategy, but it might be its best option.
AIG drop leaves investors seeking Greenberg plan
Well look who's all the sudden Mr. Popular. Hank Greenberg, the man who get railroaded out of town as AIG CEO has the attention of company shareholders after indicating that he has some strategic ideas for the company. It helps that the company has taken some big hits lately, since that always gets shareholders in the mood for change. Still, with no Enron situation ever having really materialized, as some had feared, the longtime veteran is maybe thought to have some value to the company.
European Central Bank Chief Laments Euro’s Climb (NYT)
Skim through a few quarterlies and you can see that plenty of US companies are adding meaningfully to their bottom lines because of currency. Of course, the US dollar is bringing down the whole value of the company, but that's okay, because their stock is in US dollars too, so nobody has to notice. That being said, we're sure the converse is ugly, as European firms must be seeing the exact opposite, which is why the ECB Chief is now a strong dollar man. That being said, in the US, all of our public officials are ostensibly in the strong dollar camp, and yet all they do is take moves to weaken it, so not sure what that means.
Toy Recalls Revive Industry Worries (WSJ)
As if retailers didn't have enough to be concerned about this year, there's a growing sense that the toy thing, the recall thing, could keep parents away from buying plastic junk that ruins their kids' brains. What's more, there are all kinds of things that aren't toys, but which might as well be cause they're a lot more fun: a football, an iPhone a Lenovo Thinkpad, a book on how to be peri-mutual betting systems, etc. So many alternatives to toys this year, with much less fear of lead poisoning.

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BHP May Need to Add Cash to Rio Offer After Rejection (Bloomberg)
Yesterday's news about BHP making a bid for Rio Tinto was just a small, but cryptic note with little context. Then we learned more as the day went on. Yes, it's a serious offer, and although Rio Tinto rejected it, it's possible that another one is coming. Whereas with some of these copper firms we've talked about, big bidding wars have emerged, it's hard to imagine too many players plunking down for a shot at $173 billion Rio Tinto. It's probably either BHP Billiton or nobody.
Sprint Nextel, Clearwire Drop Plans for Joint WiMax Network (WSJ)
The emergence of true wireless broadband may still be a little while away. The latest blow, reported last night, is that Sprint Nextel has dropped plans to partner with Clearwire on a nationwide WiMax rollout. Sprint has its own plans, but independent WiMax operator Clearwire was to help it expand its footprint. Not so much. All the turmoil at Sprint and the decision that it needs to focus on slicing costs is what did the project in.
2 Studios Escalate Actions Against Striking Writers (NYT)
,,,And we're reaching the end of Week 1 with no agreement in sight. Still no reports of scab activity; nobody is being shipped in from India to write the Daily Show just yet. And there aren't any Pinkertons busting heads yet either, which is probably good. But a couple of studios are seeking to use the courts to hit the writers, alleging that certain writer/producers (show runners, as they say in the biz) are in breach of contract by joining the strike. Granted, some of these runners might not have anything to do if they were actually at work... still, it's the principle of it all.
Rah! Rah! Block That Rook! (American)
Interesting article about small universities building up powerhouse chess teams as a way of attracting bright students, while pulling in money form donors. University of Texas... Dallas happens to be one. This article actually resonates with us personally, since when we were in high school, it crossed our minds to look for chess scholarships (found none). Of course, we were also deluded about our own skill, so it's not like we'd have been eligible for any that we found.

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