Derivatives Write-Downs Hit MBIA (WSJ)
Just so you can keep tabs, MBIA lost $2.3 billion, as it took a quarterly writedown of $3.5 billion. The good news: without the writedown, MBIA is making a lot of money. $1.2 billion to be exact. And as typical for these things, the company also closed another $500 million stock sale to Warburg Pincus, as part of its previously announced agreement. Apparently, the company felt folks needed a lot of time to digest the news, since they put the release out just after midnight.
Starbucks axes sandwiches as part of fix (AP)
This is interesting. As part of its re-invention plan, Starbucks plans to eliminate sandwiches from its stores. You know, it's all about returning to its java roots. It's not that people aren't buying them though. They reportedly get each store about $35,000 in annual revenue, around $100 per day that works out to, but we're guessing that on the bottom line, they're not all that. Maybe it's time to install sushi bars.
Isuzu pulls plug on its auto sales (Bloomberg)
Isuzu is getting out of the US auto game, going the way of Mitt Romney's Dad's company. The company said it was hurt by a decision from General Motors to stop manufacturing one of its SUVs. That's too bad. We're going to miss those Joe Isuzu ads on TV. They're funny. No, in all seriousness, we recall a few years ago some chatter about bringing that guy back. What happened to that? The company will still do auto parts.
Something New To Worry About: China’s Snowstorms (TechTraderDaily)
That snowstorm we mentioned yesterday, in China, turns out it's really got people concerned. Some crazy stats: 107,000 buildings collapsed, 42 billion square acres of crops destroyed. And apparently companies are already blaming weak performance on the storm. It'll be like El Nino is here. If you've got weak performance and it happens to be an El Nino season, then you get a little bit of extra credit.
Strong Holiday Season Lifts Amazon’s Revenue (NYT)
Wall St. sure loves a fat margin. And Amazon has never really cared about margins. Born in the growth-at-all-costs 90s, the company has never made a secret of the fact that it will go for every dollar of revenue it can get, assuming there's any profit at all. So while the company has lately been performing well, the market is having one of its classic Amazon fits as investors fret about op margins. The company gets a lot of credit for doing stuff on web services and DRM-free MP3 downloads, but for now, and for a long time, it's still mainly a books and housewares retailer.
Live-blogging tonight's GOP presidential debate (Tribune)
The only real interesting question right now is what do you think of Mike Huckabee's highway plan? During every debate, the folksy ex-Governor of Arkansas gives his spiel about how the rebates, on borrowed money from the Chinese, won't do anything good, but that if they took that money and spent it on new highway projects, the economy would be re-invigorated. In a way, e think it's a ploy to sound intentionally dumb. He won't win over the country club Republicans with such plain talk, but his core base may like the straightforwardness of it. More importantly, maybe it's not that dumb. Granted, we're not fans of government boondoggles, by a long shot. But is it that ridiculous that a presidential candidate would talk up rebuilding our roads as a way of strengthening the economy? It probably makes more sense than printing money, no? Seeing as we've generally accepted in this country, that roadbuilding is the legitimate domain of the public sector, it stands to reason that at some point the government will need to do a major investment in this area.
National Century Fraud Trial Set for Monday (The Daily Caveat)
For all you corporate fraud trial junkies out there: National City Financial Enterprises went bankrupt in 2002 and now its executives are going to trial for fraud. We're not really sure what the charge is, so we'll just assume their crime was losing money.
Cement demand to grow (Pit & Quarry's Editor's Blog)
Mike Huckabee's highway plan will help boost cement demand, surely. But even without that, cement demand is expect to grow, by 2030 at least. From now 'til then, the needs of housing, buildings and roads will require a 43 percent volume bump from now until then, according to the Portland Cement Association. For some reason, that doesn't feel like that much to us, although to be honest, we can't promises that our sense of the cement market is that finely tuned.