Wall Street Diary

Joseph Granville : DJIA to Fall 4,000 Points in 2012

2012-01-23T16:39:00.000-05:00

(Bloomberg) -- Joseph Granville, a technical analyst who has been publishing the Granville Market Letter from Kansas City, Missouri, for more than 40 years, talks about the outlook for the U.S. stock market. He speaks with Adam Johnson on Bloomberg Television's "Street Smart."

Earnings this week (Jan 23)

2012-01-22T12:28:00.000-05:00

Monday: HAL TXN CSX WDC
Tuesday: AAPL BTU MCD COH EMC IGT AMD YHOO JNJ NSC VZ
Wednesday: GLW ABT UTX PX BA COP NFLX CTXS TER SNDK HES OXY
Thursday: ETN CAT T CL CNX TWC SBUX JNPR MMM PCP
Friday: F HON MO CVX PG

DeMark: S&P 500 May Reach 1,342 by Jan. 24 Before Falling

2012-01-21T01:04:00.003-05:00

The Standard & Poor’s 500 Index may approach 1,342 by Jan. 24 before retreating, said Tom DeMark.
The market may top out on Tue 1/24 at the open or at the close

The benchmark measure of U.S. equities closed at 1,315.38 today after rallying 4.6 percent in 2012 and 20 percent since Oct. 3. He said in an interview today that the measure may get to between 1,338 and 1,342, a level last seen in July.

“We still are confident we will hit that level or close to that level,” DeMark, the founder of Market Studies LLC and creator of indicators to show turning points in securities, said today on “Street Smart” on Bloomberg Television. “We could conceivably see the high Tuesday at the opening, if not at the close of trading,” he said. “We’re very close.”

DeMark predicted on Dec. 5 that the S&P 500 would advance to between 1,330 and 1,345 last month before the rally would reverse. The S&P 500 rose to 1,269.37 intraday on Dec. 27 before ending the year with a 0.04 point loss to 1,257.60, the smallest annual change since 1947. DeMark’s forecast in September that the S&P 500’s decline would stop at 1,076 proved prescient when the index bottomed at 1,074.77 intraday on Oct. 4.

The S&P list of triple-A rated countries:

2012-01-13T17:30:00.002-05:00

Switzerland AAA
Sweden AAA
Singapore AAA
Liechtenstein AAA
Luxembourg AAA
Netherlands AAA
Norway AAA
Canada AAA
Australia AAA
Finland AAA
Denmark AAA
Germany AAA
Hong Kong AAA
United Kingdom AAA

Chicago : Walgreen goes upscale with new Loop flagship

2012-01-10T02:38:00.000-05:00

Walgreen's new, 27,000-square-foot flagship store on State Street will offer everything from sushi to flu shots.

Photo by: Erik Unger

Walgreen Co. is about to unveil a new Loop flagship store that company executives are betting will change the way you think about drugstores.

On Tuesday, Walgreen will open a 27,000-square-foot, two-story location with an eye-popping array of amenities, from manicure stations to a sushi chef, in the former Loehmann's department store at State and Randolph streets. The shiny, porcelain-tiled space is a 180-degree turn from the grab-your-Q-tips-and-run stores that have blanketed Chicago for years.
But with this opportunity for brand reinvention comes plenty of risk, namely an already-crowded marketplace catering to busy professionals. And as pharmacy margins increasingly tighten, much is riding on the 110-year-old company's effort to increase personal care, food and convenience sales.

“Drugstores in general have really recognized that their hold on the beauty market has been whittled away by the Ultas and the Sephoras of the world,” says Wendy Liebmann, CEO of New York-based consumer research firm WSL Strategic Retail. “They know if they want their female customers to buy an extra item when they walk in, they really have to up their game.”

' The purpose of the new flagship is to change the perception of the brand.'

— Neil Stern, senior partner,
McMillan Doolittle & Co.

Walgreen executives won't comment on how many flagships they plan to open, but the company confirms it is evaluating former Borders bookstore sites across the country.
The No. 1 drugstore chain's makeover won't come cheap. The new Walgreens will include a sleek cosmetics area that looks like a mini-Sephora and offers $15 manicures and eyebrow-shaping. There also will be a barista, made-to-order sushi, a juice and smoothie bar, self-serve frozen yogurt, upscale wine and spirits and a wide cheese selection—even a humidor.
On the pharmacy side, the store will staff a full-time “health guide” to act as a concierge, helping customers navigate health care options. Self-serve kiosks will allow customers to grab prescription refills quickly and there will be private consultation rooms where they can get flu shots, blood-pressure screenings and blood-glucose tests.
GETTING SQUEEZED
It's by far the most aggressive in a string of moves by the Deerfield-based company to attract upscale, professional shoppers while boosting sales outside the pharmacy at the back of the store, from which Walgreen historically has drawn two-thirds of its revenue. Profit at the chain hit a record $2.7 billion in fiscal 2011, but a shake-up in the pharmacy world is threatening that figure in 2012.
Pharmacy reimbursement rates are being squeezed by the government and private insurers as they attempt to bring down health care costs. Walgreen's prescription income will decline this year after St. Louis-based Express Scripts Inc., a pharmacy benefits manager that administers health plans for corporate and private health insurance clients, dropped Walgreen from its network in a fight over prices.
As a result, Express Scripts clients—who include local employees of Exelon Corp., W. W. Grainger Inc., Allstate Corp. and William Blair & Co., to name a few—no longer can get their meds at Walgreens at in-network prices, which could cost the retailer $5 billion in sales in 2012.

Shannon Curtin is heading Walgreen's makeover.Photo: Erik Unger

Carol Levenson, a credit analyst with New York-based GimmeCredit LLC, says the corporate divorce also could lower front-end sales by decreasing the overall number of people walking through Walgreens' doors.
This is where Shannon Curtin comes in.
“My whole existence is to enhance front-of-store sales,” says Ms. Curtin, who, as Walgreen's general merchandise manager for beauty and personal care, is overseeing the overhaul. An avowed beauty junkie who got her start spritzing perfume at a Dillard's department store in Arkansas, Ms. Curtin has worked for MAC cosmetics and most recently spent nearly a decade as a senior buyer for skin care products at Wal-Mart Stores Inc.
At Walgreen, “our heritage is in pharmacy, but we want to uncover untapped potential in the front end,” she says.
Ms. Curtin has spent two years conducting market research and recruiting little-known overseas brands like Becca, an Australian makeup line whose packaging—and $25 price tags for eyeshadows—resemble those of Laura Mercier or Bobbi Brown. A facial serum from Italian skin care line Rilastil will retail for $160.
Though the European brands add a certain air of sophistication, the real litmus test will be whether major American cosmetics manufacturers “start to believe this is a legitimate outlet for higher-end products,” Ms. Liebmann says.
UPSCALE SPACES

The cosmetics area, called the Look Boutique, debuted two years ago in the New York-based Duane Reade chain as part of a successful transformation from dingy, urban drugstores to sparkly, upscale spaces that resemble department stores. Walgreen acquired Duane Reade from Stamford, Conn.-based private-equity shop Oak Hill Capital Partners in 2010 largely to capture the chain's merchandising and marketing prowess and since has tested the Look Boutiques in a handful of Walgreens across the country.

“The purpose of the new flagship is to change the perception of the brand,” says Neil Stern, a senior partner at Chicago retail consultancy McMillan Doolittle & Co. “Walgreen has always been conservative. You don't go into a Walgreens and say, ‘Wow.' “

Perhaps a bigger problem is that customers often go into a Walgreens unaware that it is, in fact, a Walgreens.

“Everyone used to say, ‘Oh, you walk inside a Walgreens and a CVS and you can't tell the difference,' “ Ms. Curtin acknowledges. “Well, now you can.”

But with Sephora, Ulta and a Macy's within blocks of the new store, not to mention scads of food options catering to the Loop lunch crowd, Walgreen will have to fight for customers.

“I might get a manicure or some sushi there,” says Heather Salisbury, a River North worker walking past the store on a recent evening. But she says she won't stop buying her makeup from the nearby Macy's Clinique counter.

With the possibility of more mega-Walgreens comes the possibility of ever more amenities—perhaps even an in-store bar. When asked whether the Loop store will follow in the footsteps of a Manhattan Duane Reade's decision to serve draft beer, a Walgreen spokeswoman says, “Never say never.”

S&P 500 just formed a "golden cross"

2012-01-05T19:29:00.000-05:00

The S&P 500 just formed a "golden cross," implying a trend change for the better. But other indicators still point downward.

The Standard & Poor's 500 just gave a signal that usually indicates a rising trend is in place that typically lasts for months, not just days.

The indicator, dubbed the "golden cross," occurs when the 50-day moving average of the index rises above the 200-day moving average. The crossover of those moving averages typically indicates the market's medium-term trend has shifted to the upside, rather than being just a short-term blip.

But what makes me very leery of the current golden cross is the proximity of serious chart resistance. Trading from January through July 2007 left a huge zone of overhead supply that already served to halt rallies in October and late November.

And even if the S&P 500 can move through the 1265-1290 zone (it traded at 1281 Thursday), the challenges above in the 1350 area are even stronger.

Adding to my apprehension is the fact that of all the major stock-market indexes, only the Dow Jones Industrial Average joined the S&P 500 with a respective signal. Neither Nasdaq Composite nor the small-capitalization Russell 2000 did. And nor did the equal-weighted version of the S&P 500 (the regular S&P 500 is capitalization-weighted and heavily influenced by larger stocks).

So far, the market is not speaking with a unified voice.

Another troubling factor is the strength of the dollar. Specifically, the U.S. Dollar Index, a basket of six currencies and heavily weighted in the euro, is near a 52-week high. Given that stocks—representing aggressive or risk assets—and the dollar—representing defensive, or safety assets—currently have an inverse relationship, it does present a dilemma for stock bulls.

Bloomberg TV

2012-01-02T17:17:00.000-05:00

NYSE Holidays 2011 and 2012

2011-12-29T20:45:00.000-05:00

NYSE Holidays	2011	2012
New Year’s Day	January 1	January 2
Martin Luther King, Jr. Day	January 17	January 16
Washington’s Birthday/ Presidents Day	February 21	February 20
Good Friday	April 22	April 6
Memorial Day	May 30	May 28
Independence Day	July 4	July 4
Labor Day	September 5	September 3
Thanksgiving Day	November 24	November 22
Christmas Day	December 26	December 25

Commodities - 2011 Performance - Milk Is Leading the Commodity Pack

2011-12-28T20:19:00.001-05:00

Milk Is Leading the Commodity Pack

COMMODITIES YTD

	Last	YTD % Change
Milk	17.05	24.27%
Feeder Cattle	150.275	21.24%
Gas Oil	921.25	19.95%
Brent Crude Oil	109.27	15.32%
Heating Oil	2.9085	14.40%
Live Cattle	123.2	13.71%
Gold	1595.5	12.25%
Crude Oil	101.34	10.90%
RBOB Gasoline	2.6888	10.64%
Lean Hogs	85.75	7.52%

Source: CNBC Analytics/Thomson Reuters

Gold performance 2007 - 2011

2011-12-26T20:51:00.001-05:00

DeMark : update on his predictions from Dec 9, 2011

2011-12-22T18:48:00.002-05:00

On 12/5/11 DeMark predicted that S&P500 may advance to between 1,330 and 1,345 by December 21.

Well, 2.5 weeks later, the index has not advanced much, and in fact is almost in exactly the same place.
Today (12/22/11), DeMark was on Bloomberg and said he still thinks the market will go up to about 1,330.

** weekly from Dec 9 **

DeMark : update on his predictions from Oct 18, 2011

2011-12-22T16:11:00.016-05:00

On Oct 18, Demark said the S&P 500 may peak that week

Well, he was actually pretty close as the market went up for another week, and then went down for 4 weeks.

IRS Announces 2012 Mileage Rates

2011-12-11T00:02:00.003-05:00

The IRS has issued the 2012 optional standard mileage rates used for deducting the costs of operating an automobile for business, charitable, medical or moving purposes. They are:

55.5 cents per mile for business miles driven
23 cents per mile driven for medical or moving purposes
14 cents per mile driven in service of charitable organizations

E-trade : Commission-Free ETFs

2011-12-08T11:59:00.000-05:00

Effective Date: 12/16/2011

ETF	Fund Family	Symbol
WisdomTree Asia Local Debt ETF	WisdomTree	ALD
WisdomTree Australia Dividend	WisdomTree	AUSE
WisdomTree Asia-Pacific ex-Japan	WisdomTree	AXJL
WisdomTree Dreyfus New Zealand Dollar	WisdomTree	AUNZ
WisdomTree Dreyfus Brazilian Real	WisdomTree	BZF
WisdomTree Dreyfus Commodity Currency	WisdomTree	CCX
WisdomTree Commodity Country Equity	WisdomTree	CCXE
WisdomTree Dreyfus Emerging Currency	WisdomTree	CEW
WisdomTree Dreyfus Chinese Yuan	WisdomTree	CYB
WisdomTree Global ex-US Utilities	WisdomTree	DBU
WisdomTree Emerging Markets Equity Inc	WisdomTree	DEM
WisdomTree SmallCap Dividend	WisdomTree	DES
WisdomTree Global Equity Income	WisdomTree	DEW
WisdomTree Europe SmallCap Dividend	WisdomTree	DFE
WisdomTree Japan SmallCap Dividend	WisdomTree	DFJ
WisdomTree Emerging Mkts SmallCap Div	WisdomTree	DGS
WisdomTree Equity Income	WisdomTree	DHS
WisdomTree International MidCap Dividend	WisdomTree	DIM
WisdomTree LargeCap Dividend	WisdomTree	DLN
WisdomTree International SmallCap Div	WisdomTree	DLS
WisdomTree Global ex-US Growth	WisdomTree	DNL
WisdomTree International LargeCap Div	WisdomTree	DOL
WisdomTree MidCap Dividend	WisdomTree	DON
WisdomTree International Div ex-Finncls	WisdomTree	DOO
WisdomTree Global ex-US Real Estate	WisdomTree	DRW
WisdomTree Total Dividend	WisdomTree	DTD
WisdomTree DEFA Equity Income	WisdomTree	DTH
WisdomTree Dividend ex-Financials	WisdomTree	DTN
WisdomTree DEFA	WisdomTree	DWM
WisdomTree Japan Hedged Equity	WisdomTree	DXJ
WisdomTree SmallCap Earnings	WisdomTree	EES
WisdomTree Emerging Markets Local Debt	WisdomTree	ELD
WisdomTree India Earnings	WisdomTree	EPI
WisdomTree Earnings 500	WisdomTree	EPS
WisdomTree Dreyfus Euro	WisdomTree	EU
WisdomTree Total Earnings	WisdomTree	EXT
WisdomTree MidCap Earnings	WisdomTree	EZM
WisdomTree LargeCap Value	WisdomTree	EZY
WisdomTree Global Natural Resources	WisdomTree	GNAT
WisdomTree Middle East Dividend	WisdomTree	GULF
WisdomTree International Hedged Equity	WisdomTree	HEDJ
WisdomTree Dreyfus Indian Rupee	WisdomTree	ICN
WisdomTree Dreyfus Japanese Yen	WisdomTree	JYF
WisdomTree LargeCap Growth	WisdomTree	ROI
WisdomTree Global Real Return	WisdomTree	RRF
WisdomTree Dreyfus South African Rand	WisdomTree	SZR
WisdomTree Managed Futures	WisdomTree	WDTI
Global X Aluminum ETF	Global X Funds	ALUM
Global X Auto ETF	Global X Funds	VROM
Global X Brazil Consumer ETF	Global X Funds	BRAQ
Global X Brazil Financials ETF	Global X Funds	BRAF
Global X Brazil Mid Cap ETF	Global X Funds	BRAZ
Global X Canada Preferred ETF	Global X Funds	CNPF
Global X China Consumer ETF	Global X Funds	CHIQ
Global X China Energy ETF	Global X Funds	CHIE
Global X China Financials ETF	Global X Funds	CHIX
Global X China Industrials ETF	Global X Funds	CHII
Global X China Materials ETF	Global X Funds	CHIM
Global X China Technology ETF	Global X Funds	CHIB
Global X Copper Miners ETF	Global X Funds	COPX
Global X Farming ETF	Global X Funds	BARN
Global X Fertilizers/Potash ETF	Global X Funds	SOIL
Global X Fishing ETF	Global X Funds	FISN
Global X Food ETF	Global X Funds	EATX
Global X FTSE Andean 40 ETF	Global X Funds	AND
Global X FTSE Argentina 20 ETF	Global X Funds	ARGT
Global X FTSE ASEAN 40 ETF	Global X Funds	ASEA
Global X FTSE Colombia 20 ETF	Global X Funds	GXG
Global X FTSE Nordic Region ETF	Global X Funds	GXF
Global X Gold Explorers ETF	Global X Funds	GLDX
Global X Lithium ETF	Global X Funds	LIT
Global X Mexico Small-Cap ETF	Global X Funds	MEXS
Global X Norway ETF	Global X Funds	NORW
Global X Oil Equities ETF	Global X Funds	XOIL
Global X Pure Gold Miners ETF	Global X Funds	GGGG
Global X Russell Emerging Mkt Growth ETF	Global X Funds	EMGX
Global X Russell Emerging Mkt Value ETF	Global X Funds	EMVX
Global X S&P/TSX Venture 30 Canada ETF	Global X Funds	TSXV
Global X Silver Miners ETF	Global X Funds	SIL
Global X SuperDividend ETF	Global X Funds	SDIV
Global X Uranium ETF	Global X Funds	URA
Global X Waste Management ETF	Global X Funds	WSTE
Global X Social Media Index Fund	Global X Funds	SOCL
db-X 2010 Target Date ETF	db-X — Deutsche Bank	TDD
db-X 2020 Target Date ETF	db-X — Deutsche Bank	TDH
db-X 2030 Target Date ETF	db-X — Deutsche Bank	TDN
db-X 2040 Target Date ETF	db-X — Deutsche Bank	TDV
db-X In-Target Date ETF	db-X — Deutsche Bank	TDX
DBX MSCI Brazil Hedged Equity ETF	db-X — Deutsche Bank	DBBR
DBX MSCI Canada Hedged Equity ETF	db-X — Deutsche Bank	DBCN
DBX MSCI EAFE Hedged Equity ETF	db-X — Deutsche Bank	DBEF
DBX MSCI Emerging Mkts Hdgd Equity ETF	db-X — Deutsche Bank	DBEM
DBX MSCI Japan Hedged Equity ETF	db-X — Deutsche Bank	DBJP

Source: E*TRADE FINANCIAL

AUSE AXJL AUNZ BZF CCX CCXE CEW CYB DBU DEM DES DEW DFE DFJ DGS DHS DIM DLN DLS DNL DOL DON DOO DRW DTD DTH DTN DWM DXJ EES ELD EPI EPS EU EXT EZM EZY GNAT GULF HEDJ ICN JYF ROI RRF SZR WDTI ALUM VROM BRAQ BRAF BRAZ CNPF CHIQ CHIE CHIX CHII CHIM CHIB COPX BARN SOIL FISN EATX AND ARGT ASEA GXG GXF GLDX LIT MEXS NORW XOIL GGGG EMGX EMVX TSXV SIL SDIV URA WSTE SOCL TDD TDH TDN TDV TDX DBBR DBCN DBEF DBEM DBJP

Tom DeMark Dec. 5 on U.S. Stocks

2011-12-06T01:21:00.004-05:00

Dec. 5 (Bloomberg) -- Tom DeMark, founder of Market Studies LLC and creator of indicators for identifying turning points in stocks, talks about the outlook for U.S. equities. DeMark Says the Standard & Poor's 500 Index may advance to between 1,330 and 1,345 this month (December 21) before the rally reverses. DeMark speaks with Lisa Murphy and Adam Johnson on Bloomberg Television's "Street Smart."

*** weekly *** (Dec 9, 2011)

CME in talks to enter China derivatives market

2011-12-03T20:07:00.005-05:00

(Reuters) — CME Group Inc., operator of the world's leading energy, grains and precious metals markets, is in talks with China's securities regulator to enter the mainland's financial derivatives market, the official China Daily reported on Thursday.

CME President Phupinder Gill told the newspaper that the group was in talks with the China Securities Regulatory Commission (CSRC) about starting a pilot overseas futures trading business that would allow some futures companies from China to buy and sell futures on the Chicago-based international exchange.

CME Group operates the Chicago Mercantile Exchange, the Chicago Board of Trade and the New York Mercantile Exchange.

"Everything is going well so far, and that will be a milestone for CME's global expansion process," Gill was quoted as telling the paper.

China closed offshore futures trading 17 years ago because of heavy speculative trade, but Gill was hoping that would change, the report said.

"During the last decade I have seen China's derivatives markets successfully shake off early challenges. The domestic regulatory institutions and exchanges have improved risk management capacity a lot, which has reached world-class," he was quoted as saying in the report.

Gill said China's exchanges in Dalian, Shanghai and Zhengzhou were "very well-managed" and that China's growth had fuelled the global economy over the past few years.

The firm was also planning to launch a clearing house in Asia and increase the number of employees in the region, the China Daily said.

In October, CME Group said about a fifth of its business came from outside North America and that it aimed to boost that figure, not through acquisitions but by expanding sales of existing products.

Securities dealer Getco acquires Bank of America's NYSE biz

2011-11-30T22:55:00.000-05:00

Getco LLC, the Chicago-based trading firm, said it acquired the New York Stock Exchange market-making business of Bank of America Corp. Terms of the purchase were not disclosed.

The combination will make Getco the second-largest designated market-maker at the New York Stock Exchange. It will handle 650 company stocks and a total of 850 securities, the company said in a news release. It will take on its new responsibilities on a rolling basis through December.

"Many companies are looking for a way to navigate today's complex marketplace and our global scale allows us to provide them with increased liquidity, better pricing and unique market insights," said Daniel Coleman, the global head of Getco's equities and client services.

Daimler AG to discontinue its Maybach ultra-luxury brand

2011-11-26T23:56:00.001-05:00

Daimler AG has decided to discontinue its Maybach ultra-luxury cars after failing to find a fix for their dwindling sales and lack of profitability, barely a decade after resuscitating the Maybach brand.

Instead, the German luxury car maker said it plans to expand its top-of-the line Mercedes-Benz segment—the S-Class—to six variations from the current three when a new generation of the flagship model is launched in 2013. Until then, Daimler said it would continue to produce the ultra-premium Maybach.

The move, which Daimler Chief Executive Dieter Zetsche first revealed in a German newspaper interview, is a bid to bolster sales in the highest end of its luxury model lineup, a task the loss-making Maybach failed to achieve from the start. Though the plush ride and its $375,250 starting price turned heads at auto shows, its sales have steadily faltered, shrinking to fewer than 200 Maybachs world-wide last year.

Japan exchanges merge

2011-11-22T01:47:00.001-05:00

The Tokyo Stock Exchange and Osaka Securities Exchange plan to merge by January 2013, creating the world's third-largest exchange in terms of market capitalization of its listings, according to a statement by the exchanges.

The deal will see the Tokyo Stock Exchange pay 480,000 yen ($6,230) for each Osaka Stock Exchange share, which closed at ¥421,000 apiece Monday on the Jasdaq. The Osaka exchange will retain its public listing following the merger as the surviving company, with the Tokyo exchange absorbed into the listed entity.

Shareholders in the Tokyo exchange will receive 0.2019 share in the Osaka exchange for each TSE share they hold. The two exchanges cited costs savings of ¥7 billion a year from integrating their trading systems as part of the rationale for the consolidation, the statement said. Osaka Securities Exchange traded up 3.7% at 436,500 in afternoon trade on the Jasdaq.

The opening of the Chicago Mercantile Exchange’s Gold contract on December 31, 1974

2011-10-31T23:29:00.000-04:00

The opening of the Chicago Mercantile Exchange’s Gold contract on December 31, 1974

Barron's : Love these illustrations by Scott Pollack

2011-10-30T22:47:00.001-04:00

ebay outage today ?

2011-10-30T19:03:00.002-04:00

Is anyone experiencing an ebay outage today?

MF Global aims for sale by Monday

2011-10-28T20:38:00.001-04:00

(Reuters) - MF Global Holdings Ltd is racing to sell all or part of its business this weekend, with its futures brokerage business seen as the most attractive, a source familiar with the situation said on Friday.

MF Global has reached out to major banks including Barclays PLC, Citigroup Inc, Deutsche Bank, Jefferies Group Inc, JPMorgan Chase & Co, Macquarie Group Ltd, State Street Corp and Wells Fargo, according to the source.

This week MF dropped almost 70%
below is an 18-month chart

"If it gets done, it needs to get done by Monday," the source said.

"Whether it gets sold in parts or pieces, they are in good shape to orchestrate this process," the source added.

Barclays, Citigroup, Deutsche, Jefferies and Wells Fargo declined to comment, while other banks could not be reached immediately for comment.

Samsung Overtakes Apple as World’s Biggest Smartphone Seller

2011-10-28T20:01:00.000-04:00

Samsung Electronics Co. overtook Apple Inc. (AAPL) in the last quarter to become the world’s largest smartphone vendor amid a widening technology and legal battle between the two companies.

Samsung shipped 27.8 million smartphones in the last quarter, taking 23.8 percent of the market.

Apple’s 17.1 million shipments, comprising 14.6 percent of the market, pushed the Cupertino, California-based company to second place. Nokia Oyj (NOK) maintained its third position, it said.

Apple, which released its iPhone 4S this month, held the top spot for only one quarter after dislodging Espoo, Finland- based Nokia earlier this year. Samsung, based in Suwon, South Korea, has turned to Google Inc. (GOOG)’s Android software to boost sales of its Galaxy smartphones and tablet computers.

Fortune 500 Women CEOs hits a record 18

2011-10-26T23:45:00.002-04:00

Only 18 of the 500 of America's largest corporations have women CEOs. Here are the women leading , with their company's rank in the Fortune 500.

11. Meg Whitman - Hewlett-Packard (HPQ)
18. Ginni Rometty - IBM (IBM)
39. Patricia A. Woertz - Archer Daniels Midland (ADM)
42. Angela Braly - WellPoint (WLP)
43. Indra Nooyi - PepsiCo (PEP)
49. Irene Rosenfeld - Kraft Foods (KFT)
68. Lynn L. Elsenhans - Sunoco (SUN)
84. Ellen J. Kullman - DuPont (DD)
119. Carol Meyrowitz - TJX Companies Inc. (TJX)
121. Ursula M. Burns - Xerox (XRX)
221. Laura Sen - BJ's Wholesale Club
226. Andrea Jung - Avon Products (AVP)
245. Deanna Mulligan - Guardian Life Ins. Of America
274. Debra Reed - Sempra Energy (SRE)
312. Denise Morrison - Campbell Soup (CPB)
415. Gracia Martore - Gannett (GCI)
417. Beth Mooney - KeyCorp (KEY)
418. Heather Bresch – Mylan (MYL)

Former McKinsey chief Rajat Gupta indicted in insider case

2011-10-26T17:54:00.010-04:00

The former head of McKinsey & Co.'s Chicago office surrendered Wednesday to face a six-count securities fraud indictment that makes him the latest defendant in the biggest insider trading case in history.

The charges against Rajat Gupta were unsealed in U.S. District Court in Manhattan, where the indictment accused him of cheating the markets with Raj Rajaratnam, the convicted hedge fund founder who was the probe's prime target.

Gupta, 62, of Westport, Conn., a former board member of Goldman Sachs and Procter & Gamble, was awaiting an arraignment on one count of conspiracy to commit securities fraud and five counts of securities fraud.

He lead McKinsey's Chicago office from 1989 to 1994, and also once served on the University of Chicago's board of trustees.

The charges carry a potential penalty of 105 years in prison.

The Securities and Exchange Commissioner originally brought civil fraud charges against Gupta in March. The SEC alleged that, at the height of the financial crisis, he passed along privileged financial information that helped enrich Rajaratnam, a former billionaire hedge fund manager who was the prime target of the criminal probe.

Gupta's lawyer responded by accusing the SEC of launching a "flawed case premised in large part on unreliable evidence being used in an attempt to bring down a man of sterling reputation and remarkable achievements without the procedural safeguards historically accorded to all persons similarly charged."

In a release, U.S. Attorney Preet Bharara said Gupta broke the trust of some of the nation's top public companies and "became the illegal eyes and ears in the boardroom for his friend and business associate, Raj Rajaratnam, who reaped enormous profits from Mr. Gupta's breach of duty."

Alluding to the wide scope of the prosecution, he added: "Today we allege that the corruption we have seen in the trading cubicles, investment firms, law firms, expert consulting firms, medical labs, and corporate suites also insinuated itself into the boardrooms of elite companies."

FBI Assistant Director-in-Charge Janice Fedarcyk said the arrest was the latest to occur in an initiative launched by the FBI in 2007 against hedge fund cheats.

"The conduct alleged is not an inadvertent slip of the tongue by Mr. Gupta," she said. "His eagerness to pass along inside information to Rajaratnam is nowhere more starkly evident than in the two instances where a total of 39 seconds elapsed between his learning of crucial Goldman Sachs information and lavishing it on his good friend."

The indictment said Gupta shared confidential information about both Goldman Sachs and Procter & Gamble from 2008 through January 2009, knowing that Rajaratnam would use the secrets to buy and sell stock ahead of public announcements.

The Securities and Exchange Commission also brought civil insider trading charges against Gupta Wednesday.

The SEC said Gupta, the former McKinsey & Co. global head, illegally tipped Rajaratnam, who has been sentenced to 11 years in prison after he was convicted at trial.

Rajat Gupta: Bigger Than Madoff?

Rajat Gupta may be the most important businessman ever charged with a serious violation of securities laws. The only people who even comes close to the stature of Gupta are Michael Milken and Bernard Madoff. But despite the vast wealth people had given to Madoff to manage, he was never a member of the inner circle of corporate power in America.

Gupta is one of the most connected people in corporate America that you've never heard of, as Duff McDonald showed in his October 2010 Fortune magazine profile. Gupta spent 34 years at McKinsey, arguably the most important corporate consulting company in the world. In 1994, he was elected head of McKinsey, a position he held for nine years.

Under his tenure, McKinsey grew into a truly global powerhouse, opening at least 20 offices overseas and more than doubling the number of consultants employed, McDonald writes.

Best trading books

2011-10-26T14:32:00.000-04:00

1. Mastering The Trade (by John Carter)

This is the book that inspired me to take trading very seriously. In a way I was very lucky, because had I not come across Carter’s book early in my trading career, I may have well ended up blowing my trading account within months.

John Carter lucidly explains the psychological and tactical challenges that face a trader. What makes this book unique and enjoyable are three things: firstly that it contains several chapters on different high probability trading strategies; secondly that each chapter gives numerous real examples of how the strategy actually works and; thirdly and most importantly, precise entry and exit rules for each strategy including how to protect yourself against risk if you are wrong.

It is not necessary for traders to employ every strategy documented in this book. I personally have adopted one of them and it has since become part of my daily trading routine (more on that in upcoming posts).

What I really love about this book is Carter’s passion for trading. I admire the way he religiously carries out each trade in accordance to his rules and not based on impulse or whim.

This book is not for the beginner. Although, the advice given in the chapters on psychology and risk is absolutely crucial for everyone.

2. Market Wizards & The New Market Wizards (by Jack. D. Schwager)

These two books are a gem whether you are a beginner or an advanced trader. Each chapter is an interview with one of the world’s top traders. It is very easy to read – even a 12 years old could make sense of it.

The personal stories and insights of each individual trader is simply fascinating to read. I won’t spoil any surprises here. One of my favourites from the book is Linda Raschke, one of the few female professional traders out there. Her comment that while we can be good at predicting the direction of a move (up or down), but not so good at predicting the magnitudeof the move (how far a market will move), is a very significant one which has helped me a lot in my own trading.

What I found interesting about this book when I first read it was how some of the world’s best traders have experienced losses in their own trading on a scale that is unimaginable. Readers will also notice that different traders will often disagree on a number of issues.

The major downside with this book is that whilst the traders give very valuable insights to their style of trading, no actual specifics are given as to exactly how they trade. Also, the interviews pre-date the technological age of the internet and widely available charting and trading softwares. Having said that, this book is a must for everyone who wants to learn how real traders think.

3. Volatile Markets Made Easy (by Guy Cohen)

This book is an ideal starter for anyone who wants to grapple with the intricate but lucrative world of options and volatile markets. One reason I am recommending this book above all the other books on options, is that its author, Guy Cohen, is an expert not just in options but very adept at being able to explain how to trade options to the ordinary person.

The first few chapters cover the basics of technical analysis and breakout patterns. Where it gets really interesting (for me) is when he talks about “straddles”. This is a strategy whereby you can potentially make money no matter which direction the market moves, up or down.

Guy Cohen does not seek to confuse the reader and he does an excellent job of clarifying what can be quite a complex topic. I definitely recommend it.

4. Technical Analysis of the Financial Markets (by John J. Murphy)

This book is the definitive guide to the world of technical analysis (analysis of charts). Fans of fundamental analysis (or “fundamentalist” as we like to call them) will probably scoff at the mere mention of technicals and charts, dismissing it as reading “tea leaves” and not serious trading. Don’t pay any attention. I don’t know of any serious professional trader who does not use some form of technical analysis.

John Murphy does a seriously good job of demonstrating how to analyse charts for the beginner traders. Trendlines, patterns, moving averages are all covered here. You can also check out his brilliant free charting service on StockCharts.com.

5. Trading In The Zone (by Mark Douglas)

If you haven’t started trading yet and you want to save yourself months of anguish and frustration, then do yourself a favour and read this book.

Trading in the Zone is not a book about “strategies” or “systems”. It is about something much more important. Any trader will tell you that 95% of trading is psychology. It is not the trading system that is important, as much as how your own mind will work against you when you do trade.

The most important concepts discussed in this book are: consistency and uncertainty. You need to be consistent in your trading method and you need to have an unshakeable belief in uncertainty – that in the markets anything can happen. Once you accept that, you can give up on the emotions that imprison your mind and learn to be a better trader.

Illinois could lose $100 million in CME/CBOE deal

2011-10-25T18:16:00.003-04:00

As the Illinois Senate prepares to act on a proposed tax break to keep CME Group Inc. and CBOE Holdings Inc. in town, the price to the cash-short Illinois treasury is becoming clearer: at least $90 million, and by some accounts even more.

The pending bill, sponsored by Senate President John Cullerton, stalled yesterday but could come up for a vote when the Senate Executive Committee meets at 3 p.m. Tuesday. Senate Republicans weren't yet behind the measure, but it's hard to see them staying off very long.

Mr. Cullerton may well need GOP votes, because the cost of cutting the corporate-income tax for the two highly profitable companies could be a tough sell to Democratic lawmakers who have been busily cutting state services that affect their constituents.

Mr. Cullerton's office says the break would save CME $60 million and CBOE around $6 million. In addition, to lure Downstate votes, the measure also contains a clause that would revive the recently expired corporate tax break for research and development, costing another $25 million to $30 million or so.

Chicago: Cullerton's measure to cut CME, CBOE taxes hits bump

2011-10-24T20:24:00.000-04:00

(Crain's) — A plan to cut state income taxes on Chicago’s big trading exchanges hit a bump late Monday when Illinois Senate President John Cullerton abruptly cancelled a vote on a bill he’d submitted earlier in the day to slash their tax liability 50% and perhaps more.

The bill, introduced Monday morning by Mr. Cullerton, had been scheduled for a vote in the normally compliant Senate Executive Committee. The measure specifically would help CME Group Inc., and CBOE Holdings Inc., both of which have threatened to move some operations out of state because of allegedly unfair Illinois taxes.

But Mr. Cullerton Monday evening postponed any vote. His spokeswoman said there was a need to “tweak the bill” and “tighten some language” — both in regard to the exchanges and to a separate clause in the bill that would revive the state’s recently expired corporate research-and-development tax credit for five years.

The R&D clause had been added as an apparent sweetener to get non-Chicago lawmakers to vote for the bill.

It was not known whether a vote also was held up because initial reaction to the proposal was poor, but Senate Republicans withheld support, at least for the moment. Their spokeswoman said the caucus appreciates the CME's and CBOE's problems but was shown the bill only an hour before it was introduced.

But, shortly after the bill was submitted, House Majority Leader Barbara Flynn Currie suggested that the bill may not be needed at all, and certainly needs full vetting.

“I’d like to see the details,” said Ms. Currie, like Mr. Cullerton a Chicago Democrat. “If there is an essential unfairness (in current state corporate income-tax law), I’d like to end it. But I don’t know if there is an essential unfairness.”

House Speaker Michael Madigan has recused himself on any CME legislation, making Ms. Currie the senior House Democrat on this measure.

Mr. Cullerton's office said both CME and CBOE would get a 50% cut "as currently drafted," but added, "Things are changing." Other Springfield sources said they weren’t sure exactly what the savings would be.

As introduced, both exchanges generally would pay state corporate income tax only on 27.54% of receipts from transactions “matched or executed by means of an electronic transaction system.” Such trades represent the vast bulk of CME and CBOE's transactions.

A minority of trades — those attributable to the traditional “open outcry” system on exchange floors — would be 100% taxable in Illinois, if they occurred in Illinois. But such trades make up a relatively small share of the exchanges' overall business, and much of the CME's open outcry trades occur at its New York Mercantile Exchange unit in New York.

Both Gov. Pat Quinn and House Democrats have been supportive of the idea of helping the exchanges, but it was not immediately clear if they are endorsing Mr. Cullerton's bill.

"We’re reviewing the proposal,” a spokeswoman for the governor's office said Monday evening.

The exchanges have loudly complained in recent months that they paid a disproportionate share of the state’s corporate income taxes, because almost all of their income was attributed to Illinois sales despite their world-wide customer base. Other states reportedly have made significant financial offers to the exchanges to get them to move their headquarters out of Illinois.

McDonald's adding McBites to national menu

2011-10-24T00:06:00.000-04:00

McDonald's Corp. is taking its Chicken McBites national early next year, the biggest change to its 2012 food and marketing calendar.

The Oak Brook-based fast-food chain will feature the mini-fried chicken pieces as a limited-time promotion in early spring, according to executives. Other items to be rotated onto its menu include a 100% fruit-juice slush called a Cherry Berry Chiller and a blueberry banana nut oatmeal later in the spring.

The company also will add flavors to existing products, such as its premium chicken sandwich and coffees and hot chocolate.

A spokeswoman declined to comment on the plans and the company didn't provide any specifics on its product rollout in its third-quarter conference call with shareholders this morning. On the call, McDonald's CEO James Skinner said only that the U.S. is planning a number of marketing promotions around new products next year.

McBites, which first test-marketed in Australia and then Detroit this year, are bite-sized nuggets similar to chicken versions of popcorn shrimp. Chik-fil-A Inc. already sells something like this, called Nuggets. The Atlanta-based chain also has Chick-n-Minis, which are nuggets in a bun and trays in three sizes that serve eight to 25 people.

McBites will come in packages of 4, 6 and 12 ounces and priced from $1.99 to $4.99, accompanied by dipping sauces.

The Cherry Berry Chiller is being tested in several Michigan markets. It is made with 100% fruit juice blended with crushed ice. In some markets, a small size is free with any large sandwich.

McDonald's, meanwhile, reported strong third-quarter earnings that beat analyst expectations. Net income rose 9% to $1.51 billion on a 14% gain in revenue to $7.17 billion.

Sales at stores open more than a year increased 5% for the quarter, including a 4.4% advance in the U.S. Management expects year-over-year revenue to rise 4% to 5% in October.

The company credited its recent gains on several menu items. McDonald's original McNuggets, now with four new dipping sauces, grew 10% in the quarter. Frozen strawberry lemonade and mango pineapple fruit smoothies launched over summer boosted McCafe beverage sales by 16%. Units of breakfast offerings, which account for 25% of sales, were up 20% over last year.

Besides new products, McDonald's management addressed pricing in the face of rising commodity costs which are squeezing margins. Ingredient costs rose 8% in the third quarter, on top of 6% and 1% in the two previous quarters, and the company expects them to increase further.

“These prices, which typically moderate after the summer, have remained high,” Chief Financial Officer Peter Bensen told analysts. “As a result, we now expect commodity cost in the U.S. to be up a little more than previously expected, 4.5% to 5% for the full year with fourth-quarter increases easing compared to second and third quarter.”

When asked what the higher expenses will mean for the Dollar Menu in 2012, Mr. Skinner declared: “Dollar Menu is here to stay. We have support by our franchisees for the Dollar Menu going into 2012.”

McDonald's already hiked prices twice this year, by 1% in March and 1.4% in May, and will consider more as necessary.

“We will continue to evaluate additional price increases in light of this inflationary environment always balancing our goal of driving traffic and marketshare gains with effectively managing the impact of rising costs,” Mr. Bensen said.

Motorola Solutions introduces tablet aimed at biz users

2011-10-19T23:43:00.000-04:00

Motorola Solutions Inc. is betting tablet computers will be as popular with corporate users as they are with consumers.

The Schaumburg, Illinois -based company, which makes bar-code scanners for retailers as well as radios for emergency workers, on Monday launched its own Android-powered tablet. The ET1 tablet is more durable and features an optional barcode scanner and magnetic stripe reader, among other options, according to a press release.

Tablets are being used everywhere from airline cockpits to the sales floors at retailers. ABI Research estimates that corporate demand for tablets will soar to 115 million devices in 2016 from 3.6 million units this year.

Motorola said the tablet will sell for less than $1,000.

“The ET1 will enable store associates to leverage the sleek design and user experience of a tablet with the applications, durability, security, device management and lifecycle support that retailers require,” said Girish Rishi, corporate vice-president and general manager of mobile computing at Motorola Solutions, in the release. “The tablet's robust feature set also will meet the critical needs of mobile workers in other enterprise sectors such as manufacturing and logistics.”

The device was developed separately from Motorola Mobility, its Libertyville-based cousin that makes mobile phones and introduced the Xoom tablet in February. They split into separate companies in January.

MBA applications drop at Booth, Kellogg, Loyola

2011-10-19T23:40:00.001-04:00

Applications to most of Chicago's business schools are declining, as the recession makes would-be graduate students more wary of taking on huge education debts in an uncertain job market.

Loyola University's Graduate School of Business, one of the metro area's smaller business schools, posted the biggest drop; MBA applications were down 9.5% this year, to 399 from 441 in 2010.

But Chicago's world-ranked institutions are down as well. At Northwestern University's Kellogg School of Management, 2011 applications declined 5.6%, to 4,974 from 5,270, while at the University of Chicago's Booth School of Business, applications slipped 3.0%, to 4,169 from 4,299.

Breaking from the trend, DePaul University's Kellstadt Graduate School of Business posted an increase, jumping 13%, to a record 1,895 from 1,678 in 2010. Kellstadt's application numbers now have risen for four consecutive years and are up 48.5% since 2008.

Melissa Booth, Kellstadt's director of admissions and recruiting, attributes the upsurge to chronic high unemployment. "Many students choose to come back to school for advanced business degrees once they have been laid off," she writes in an email.

DePaul is helped, too, by being less expensive than its neighbors. At $900 per credit hour, a Kellstadt MBA costs students $16,000 to $24,000 a year. Loyola charges $3,858 per course, which puts its annual pricetag at $27,000 to $35,000. Booth's annual tuition is $53,400, while Kellogg's is $54,000.

Graduate school applications tend to rise when the economy slumps, as college students defer their entry into a poor job market and laid-off workers go back to school to improve their résumés and contacts. But as the economy continues to struggle to create work—on Friday the government said the jobless rate remained at 9.1% in September—fewer people are able to afford the cost of business school or see its value.

According to research published by the Graduate Management Admission Council last month, two-thirds of two-year, full-time MBA programs received fewer applications in 2011. The council surveyed 331 business schools nationwide.

GMAC President and CEO Dave Wilson attributes the drop to economic uncertainty. “The caution in this year's survey for full-time MBA programs is unsurprising in the current economy as students weigh the financial and time commitments required to pursue a graduate business degree,” Wilson says in a statement.

Booth and Kellogg — ranked No. 1 and 4 among U.S. MBA programs in 2010, according to Bloomberg Businessweek — have plenty of company among top-tier business schools. Poets&Quants, a B-school website, reports that applications this year are down 4.7% at Harvard Business School, 5.7% at University of Pennsylvania's Wharton School and 8% at Cornell University's Johnson School of Business.

At Loyola, MBA school applications have fallen for two consecutive years, after increasing 10% in 2009. Pamela McCoy, director of Loyola's business school, says that budget-strapped employers are re-examining tuition reimbursement options, further reducing people's incentive to leave their jobs for business school.

At Kellogg, 2010's applicant pool was essentially unchanged from 2009, when applications rose 4.3%. Booth declined to provide application numbers from previous years.

Admissions personnel from Kellogg and Booth declined to comment.

Unless the economy rebounds, Eliot Ingram, co-founder of Clear Admit, a Philadelphia-based MBA admissions consultancy, predicts applications will decline moderately next year, too. "This won't be a factor for top schools, who receive enough strong applications to fill a class several times over," he says. "But it could become an issue for smaller, regional schools."

DeMark: S&P 500 May Peak This Week

2011-10-18T15:21:00.000-04:00

The Standard & Poor’s 500 Index may advance about 4 percent this week before the gain ends, according to Tom DeMark, the creator of indicators meant to identify turning points in the price of securities.

DeMark, whose prediction last month that the S&P 500’s decline would stop at 1,076 proved prescient when the index bottomed at 1,074.77, said the rally that lifted the benchmark as much as 14 percent since then will fizzle. The S&P 500 will rise as high as 1,254 before falling at least 5.6 percent, he wrote in an e-mail today.

“This rally should squeeze short sellers and exhaust late buying,” said DeMark, the founder of Market Studies LLC. “The rally should be fast.”

The benchmark gauge for U.S. equities jumped 11 percent in the nine days ended Oct. 14, the biggest advance since March 2009, on optimism over corporate earnings and steps by European leaders to support banks. The rebound brought the gauge close to the top of a price range between 1,074.77 and 1,230.71, where it’s traded for more than two months. The index gained 0.8 percent to 1,210.74 at 11:44 a.m. New York time.

The S&P 500 would produce a sell signal today by closing above its Oct. 12 close of 1,207.25, marking the ninth consecutive day that the benchmark exceeded its final price four days earlier, DeMark said. A close above a two-month high of 1,224.58 reached on Oct. 14 would “perfect” the sell setup, according to DeMark, who has spent more than 40 years developing indicators with names like “sequential” and “countdown.”

The model calls for “one day of grace” should the index fail today to surpass its close four days ago. In that case, should tomorrow’s open exceed the Oct. 12 close, it would suffice for the sell setup, DeMark said.

DeMark, an adviser to Steven A. Cohen’s SAC Capital Advisors LP, provided consulting to hedge funds including George Soros’s Soros Fund Management LLC and Leon Cooperman’s Omega Advisors Inc. Advisors Inc. He said during an interview on Aug. 16 that some European banks are “bottoming right now” and companies such as Societe Generale SA, BNP Paribas SA, UBS AG and Credit Agricole SA “look like buys.”

Latour Trading unseats Goldman to become the number one player on the NYSE

2011-10-17T20:22:00.000-04:00

Traders were left bemused last week when it emerged that a mystery trading firm had unseated Goldman Sachs to become the number one player on the New York Stock Exchange's closely watched program trading list during the last week of September.

Financial News has found that, at the same time as Latour Trading was rising up the NYSE list, another unknown trading company, Spire Europe, took the No. 2 spot on Nasdaq OMX's Nordic market for September.

We have also discovered that the similarity in the names of the two firms and the timing of their ascent is no coincidence.

According to NYSE's weekly report, Latour Trading was the most active firm on the list for the last week of September and the first week of October, trading some 484.6 million and 568.8 million shares respectively. The list, which breaks out principal trading, is used by market-watchers as a proxy for the most active proprietary trading desks. Proprietary traders are traditionally a secretive bunch due to the highly competitive nature of their strategies.

According to Nasdaq data, Spire was second only to Getco, the well-known Chicago-headquartered firm, among high-frequency players during the month by market share, and the 11th-largest provider of liquidity overall. It traded equities worth EUR3.6 billion.

According to filings with the U.K.'s Companies House and the U.S. Securities and Exchange Commission, both firms are wholly owned subsidiaries of Tower Research Capital, a New York-based hedge fund that specialises in high-frequency trading strategies. These firms typically use their own capital to trade large volumes across markets in a fraction of a second using sophisticated technology.

Tower Research Capital was founded in 1998 by Mark Gorton, who had worked in the proprietary trading division at Credit Suisse. The company hit the headlines last year during the trial of Societe Generale trader Samarth Agrawal who was convicted for stealing proprietary trading code from the French bank. Agrawal was leaving SocGen to join Tower Research.

According to SEC filings, Latour was founded in 2009 and is also active on the Chicago Board Options Exchange. The company, which occupies a floor of the same Broadway building as Tower Research, employs one person thought to be the company's chief executive, David Faucon. Faucon helped build the high-frequency trading desk at Societe Generale.

Spire was first established in 2006 but only began trading in 2009. According to sources familiar with the matter, Spire is active on Chi-X Europe, while public data shows it is also active on the London Stock Exchange , NYSE Euronext and the Swiss markets.

Scott Johnston, Tower's chief operating officer, confirmed that Latour and Spire are SEC and FSA-regulated subsidiaries respectively and added: "Latour is a member of most US equity exchanges and is a registered marketmaker on Nasdaq, Arca and Bats. Spire Europe is a member of, and marketmaker on, European equity exchanges and MTFs."

Slovakia approves bailout expansion

2011-10-13T13:47:00.000-04:00

Slovakian parliament approves expanding euro bailout fund, clearing way for its use in crisis

BRATISLAVA, Slovakia — Slovakian lawmakers on Thursday approved expanding the size and powers of the EU bailout fund, overcoming an earlier rejection and removing the last hurdle to the fund’s use as the continent’s main weapon against the debt crisis.

Slovakia is the last of the 17 eurozone nations to approve boosting the bailout €440 billion ($600 billion) fund, called the European Financial Stability Facility. The fund will be able to lend quickly to governments before they are in a full-blown crisis and help them boost banks’ health.

The country’s parliament had rejected the changes to the bailout fund on Tuesday because a junior coalition partner, the Freedom and Solidarity party, was against it. In a desperate effort to force that party to vote in favor, Prime Minister Iveta Radicova had tied the vote on the bailout fund to a confidence vote in the government. When the vote failed, her 1-year-old government collapsed.

The main opposition party, Smer-Social Democracy, then agreed to help the outgoing coalition approve the expanded fund in a second vote in exchange for early elections.

Parliament voted Thursday in favor of holding early elections in March, with 143 in favor and 3 against. Just a half hour later, they approved boosting the bailout fund — 114 were in favor. Only 76 votes were needed.

Radicova welcomed the result and thanked lawmakers for a “very responsible” decision.

“This is a step to stop a debt crisis in Europe,” Radicova said. “We belong to Europe, to the eurozone, and we sealed that today.”

Raj Rajaratnam of Galleon Group gets 11 years for insider trading

2011-10-13T12:19:00.003-04:00

Raj Rajaratnam, the founder of the Galleon Group family of hedge funds, was sentenced on Thursday to 11 years in prison for his role in a huge insider trading case.

That is the longest sentence ever handed out for insider trading. Previously, the record was ten years—held by another Galleon employee, Zvi Goffer, and Hafiz Muhammad Zubair Naseem, a former Credit Suisse banker sentenced in 2008.

Prosecutors had sought a sentence of up to more than 20 years in prison, while Rajaratnam's lawyers had asked for no more than 8 years.

Rajaratnam was convicted in May on several charges of insider trading and conspiracy.

Rajaratnam, who headed Galleon Management, was convicted in May on 14 counts of conspiracy and securities fraud for illegally using inside information to trade in stocks such as Goldman Sachs and Intel. The trading generated profits or avoided losses of $72 million, the government estimated.

The sentence was substantially less than the government sought. In an August court filing, the Justice Department proposed a prison sentence of 19 years and seven months to 24 years and five months. Such a term was warranted to “provide just and fair punishment for perhaps the worst insider trading offender (who has been caught to date) in history, and deter others,” the Justice Department wrote.

To build its case against Rajaratnam, the government used tactics traditionally associated with investigations of violent offenses, such as drug dealing and organized crime. Though Rajaratnam did not testify at his trial, the prosecution made extensive use of secretly made recordings of him talking to his associates.

According to the government, Rajaratnam gathered inside information about pending corporate deals and earnings announcements from an array of tipsters including a Goldman Sachs board member, a senior partner at the consulting firm McKinsey & Co., and an employee at another hedge fund.

Rajaratnam, who is in his 50s, will join a list of high-profile, white-collar financial figures sent to prison, including former Enron executive Jeffrey Skilling, former WorldCom executive Bernard Ebbers and Ponzi scheme mastermind Bernard Madoff.

The insider trading case was the most prominent of its kind since Ivan Boesky was convicted a generation ago.

Tom DeMark Oct. 5 on U.S. Stocks, Gold and Oil

2011-10-05T23:22:00.002-04:00

Oct. 5 (Bloomberg) -- Tom DeMark, founder of Market Studies LLC and creator of indicators for identifying turning points in securities, talks about the outlook for U.S. equities, the gold market and oil prices.

DeMark said a 3.8 percent rally tomorrow in the Standard & Poor’s 500 Index would create a pattern that may result in a “sharp decline” a day later. He speaks with Adam Johnson on Bloomberg Television's "Street Smart."

New Checking Fees At... Citibank

2011-10-05T18:15:00.001-04:00

Following in Bank of America's footsteps, Citi will unleash a new wave of checking fees in December, reports CNN Money.

Mid-tier Citibank account holders will now be hit with a $20 fee for failing to maintain a minimum $15,000 balance (it was $6,000 before); and EZ Checking account holders will now pay $15 a month for not maintaining a minimum $6,000 balance.

CNN also reports that the bank is phasing out EZ Checking, replacing it with the option of either a Citibank account or Basic Checking account, which of course carries fees ($10 per month, up from $8 in September) unless these customers maintain a $1,500 minimum balance or make at least one online payment or direct deposit transaction a month.

McGraw-Hill, CME in index joint-venture talks

2011-09-29T18:05:00.004-04:00

McGraw-Hill Cos. (MHP) is in advanced talks to combine its S&P Indices business with CME Group Inc.'s (CME) Dow Jones Indexes, according to a report published in the online version of The Wall Street Journal late Thursday.

If a deal is completed, a joint venture will house well-known indicators including the S&P 500 Index SPX and the Dow Jones Industrial Average DJIA . McGraw-Hill would manage the joint venture and be its largest stakeholder, according to the report, citing people familiar with the matter.

CME owns 90% of the Dow Jones Indexes through a joint venture with Dow Jones & Co. CME would have a minority stake of about 25%, while Dow Jones could have a minimal stake. Dow Jones is a unit of News Corp. (NWS)

World's biggest employers

2011-09-18T21:33:00.000-04:00

America's defence department had 3.2m people on its payroll last year, equivalent to 1% of the country's population. China, the world's most populous nation and a big military spender, employs 2.3m people in its armed forces. And the number of people working for the National Health Service in England is equivalent to over 2.5% of the country's population. The three private companies are Walmart, McDonald's and Taiwan's Hon Hai Precision Industry Company, a subsidiary of which is Foxconn, a secretive electronics manufacturer.

Gold-Backed Dollar Signals $10,000 Metal Price

2011-09-17T18:18:00.000-04:00

(Bloomberg) -- Gold has the potential to jump more than five-fold as the precious metal’s price catches up with the surging amount of money in the U.S. economy, according to Dylan Grice, a global strategist at Societe Generale SA.

The chart above shows the price at which each U.S. dollar in the monetary base, compiled by the Federal Reserve, would have been backed by an ounce of gold for the past half century. International Monetary Fund data on the country’s gold reserves were used in the calculation.

Grice, based in London, identified this price as the metal’s “fair value” yesterday in a report. Since June, it has
exceeded $10,000 an ounce, as depicted in the chart’s top panel. Gold for immediate delivery closed at $1,819.63 an ounce on the spot market yesterday.

The bottom panel tracks the value of U.S. gold holdings, based on the spot price, as a percentage of the monetary base for the 50-year period. August’s proportion was 18 percent of the $2.66 trillion in the economy. The latter figure was more than triple the amount three years earlier, reflecting efforts
by the Fed to spur economic growth.

“There is a demand for an honest currency,” Grice wrote. “The last time honesty was perceived to be so scarce -- in the 1970s gold mania -- the dollar was over-backed by gold. If it happened then, why not again?”

U.S. gold holdings peaked at 131 percent of the monetary base in January 1980, when spot gold climbed to $850 an ounce after a more than 14-fold advance in the preceding decade. The high equals about $2,330 an ounce in today’s dollars, according to a Labor Department calculator.

UBS Reports a $2 Billion Loss by a Rogue Equities Trader

2011-09-15T13:03:00.003-04:00

Kweku Adoboli, a 31-year-old trader at UBS (UBS), was arrested in London. Adoboli was accused of costing UBS $2.3 billion by making unauthorized trades. An Oct. 20 Bloomberg story noted that "the trading losses prosecutors claim he was responsible for led to the departures of Chief Executive Officer Oswald Gruebel and the co-heads of the Swiss bank's global equities business."

A 31-year-old man who works for Switzerland’s largest bank was arrested Thursday in London on suspicion of fraud.

UBS said on Thursday that a rogue trader in its investment bank had lost $2 billion, delivering a fresh blow to the beleaguered Swiss bank.

The police in London have arrested a European equities trader, Kweku Adoboli (left), in connection with the case, according to a person with direct knowledge of the situation who was not authorized to speak publicly.

The incident raises questions about the bank’s management and risk policies at time when it is trying to rebuild its operations and bolster its flagging client base. The case could also bolster the efforts of regulators who have been pushing in some countries to separate trading from private banking and other less risky businesses.

The revelation about the rogue trader comes as the bank tries to regain its financial footing. Last month, UBS announced it would shed 3,500 jobs, following poor second-quarter results. In an internal memo, the bank said the unauthorized trading could drag down earnings in the third quarter to a loss, adding that “no client positions” were involved in the “unauthorized trading.”

Ted Weschler's $5m Buffett lunch pays off

2011-09-13T09:32:00.001-04:00

Berkshire Hathaway announced yesterday that Ted Weschler, the managing partner of Charlottesville, Va.-based hedge fund Peninsula Capital Advisors, will join the company to manage some of its investments. He’ll be on the same team as Todd Combs, who was hired last year and is also considered a potential heir to Buffett. The pair will manage a portion of Berkshire’s stock portfolio.

Weschler, 50, piqued Buffett’s interest when he bid over $2.6 million in 2010 and again in 2011 at an annual charity auction to dine with the Oracle of Omaha. Buffett was apparently so impressed with Werschler he offered him the opportunity to work with him, which Weschler accepted. He’ll be winding down his own fund soon in order to focus on Berkshire full-time.

Peninsula Capital Advisors, LLC is a privately owned hedge fund sponsor. The firm invests in the public equity and fixed income markets of the United States. It employs an opportunistic strategy to make its investments. Peninsula Capital Advisors was founded in 2000 and is based in Charlottesville, Virginia.

Weschler, 50, told his limited partners that he will be winding up his fund, Peninsula Capital Advisors, in order to join Berkshire early next year.
As of the second quarter of 2011, Peninsula Capital had about $2 billion long positions in equities, according to the latest 13F.

Weschler previously served as an executive officer at the private equity fund Quad-C. He's a member of the board of directors for First Avenue Networks, WSFS Financial Corp., WSFS Federal Savings Bank, and Virginia National Bank.

He graduated with a bachelor's degree in economics with concentrations in finance and accounting from the Wharton School of Business at the University of Pennsylvania.

Fortune reports that Weschler first caught Buffett's attention because he was the anonymous winner, until now, of the annual auction for Glide, a San Francisco church and mission.
The top bidder gets to have lunch with the "Oracle of Omaha."

For two consecutive years, Weschler was an anonymous bidder with winning bids of $2,626,311 in 2010 and $2,626,411 in 2011, Fortune reported.

The prize was to have lunch in New York at the Smith & Wollensky steakhouse, but Weschler requested to have the lunch in Omaha at one of Buffett's favorite restaurants, Piccolo's.

Mr Weschler is expected to serve alongside Todd Combs, formerly manager of hedge fund Castle Point Capital, who was appointed in 2010, as part of a new generation of managers who will oversee Berkshire's equity and debt investments. Berkshire said it might add a third new manager.

Berkshire will also have to find a replacement for Mr Buffett, who is 81, as chief executive of Berkshire itself. Thinking on that part of the succession was thrown into turmoil when David Sokol, a senior lieutenant, was found to have bought shares in a company he later recommended to Berkshire. Mr Sokol resigned, and Mr Buffett apologised to shareholders.

In a statement on Monday, Berkshire said; "After Mr Buffett no longer serves as CEO, Todd and Ted -- possibly aided by one additional manager -- will have responsibility for the entire equity and debt portfolio of Berkshire, subject to overall direction by the then-CEO and board of directors."

Gold's worst days

2011-08-24T16:14:00.005-04:00

Gold Plunges 5.6%, Ending Below $1,800

Gold futures ended the regular session down by $104, or 5.6%, at $1,757.30 an ounce for the most-active contract, in the second-biggest dollar decline ever.

Gold futures are falling sharply Wednesday, with the precious metal losing $86.30, or 4.6%, to trade at $1,775.50 an ounce on the Comex division of the New York Mercantile Exchange.

Analysts said the metal’s failure to top $1,900 an ounce appears to have marked a near term top given gold’s steady rally all year.

Still Wednesday’s sharp decline is a candidate for one of the metal’s worst days ever, in percentage losses.

The 10 worst days for gold, according to data compiled from FactSet Research:

-7.30	6/13/2006
-5.83	3/19/2008
-5.51	8/05/1993
-5.37	5/24/2006
-5.15	12/01/2008
-4.85	10/02/2008
-4.83	10/24/1997
-4.41	2/04/2010
-4.27	10/22/2008
-4.23	8/11/2008
-4.11	10/16/2008
-4.01	12/04/2009

Performance gold vs silver - 12 months

2011-08-24T14:51:00.002-04:00

Performance : gold, silver, Swiss franc vs S&P 500 (6 months)

2011-08-21T20:21:00.001-04:00

Coca-Cola plans to invest $4 billion in China

2011-08-20T14:40:00.000-04:00

Atlanta based Coca-Cola (KO) plans to invest $4 billion in China, the company's CEO Muhtar Kent told reporters in Shanghai this week.

It's the company's biggest planned investment in China since the 2009 investment of $2 billion. The investments will start next year and is part of the company's China capex until 2014.

Kent said the company is even considering listing its shares on the Shanghai Stock Exchange, adding itself to the list of mainstream brands listing their depositary receipts on exchanges outside of their home base. Massachusetts luggage maker Samsonite opted to list in Hong Kong in the second quarter rather than do its initial public offering on the NYSE. The new China investments will focus on innovation, infrastructure and expansion of its production capacity. The company now has six manufacturing centers in the country.

"U.S. corporations are actually in good shape and a lot of that is due to emerging markets, particularly the BRIC countries," fund manager Paul Dietrich of Foxhall Capital Management in Orange, Conn told Forbes on Friday. The BRIC countries are Brazil, Russia, India and China.

Low growth in the U.S. and Europe have essentially forced the hands of the big multinationals to look for growth elsewhere. "In this low growth environment, we will continue to see European and American multinational companies spending in countries far from home," says Martin Schulz, managing director of international equities at PNC Capital Advisors in Columbus, Ohio.

HP kills TouchPad, Pre, WebOS and PC business; stock drops 20% on the news

2011-08-19T16:08:00.001-04:00

HP shutters tablet and smartphone business, largely killing off smartphone pioneer Palm; stock drops 20% on the news

(AP) -- When Hewlett-Packard Co. snapped up Palm Inc. last year for $1.8 billion, it looked like the smartphone pioneer's last chance.

Palm was a year into a major turnaround effort but gaining little traction despite a hip, new CEO known for making the iPod a household name. It had high hopes for its latest handset, the Pre, which ran on the company's new, intuitive operating software, known as webOS. It needed a savior, and HP, which itself needed a boost in the mobile technology market, seemed like its best bet for survival.

It didn't work. With fierce competition from Apple Inc.'s iPhone and smartphones running Google Inc.'s Android software, HP's handsets running the webOS software developed by Palm have been just a blip on most consumers' radar screens. A tablet called the TouchPad, released in July and also running webOS, has also sold poorly.

The market seemed too tough for HP to forge ahead: The technology conglomerate said Thursday that it is shuttering its mobile device business, which includes the webOS-running smartphones and TouchPad.

The announcement came as HP said it also plans to sell or spin off its PC division. Together, the moves would take HP out of the consumer market, though it will continue to sell servers and other equipment to business customers.

Technology developed by Palm (a brand name HP has phased out) may still exist in some form. In an interview, HP CEO Leo Apotheker said the company was disappointed more with the hardware sales than the performance of the webOS software, which it will try to keep alive in some way. HP is studying its options, which could include licensing the software to handset makers or allowing them to use it for free as open-source software, as Google does with Android.

Still, for Palm, the decision sounds largely like a death knell that comes after nearly 20 years of mobile technology innovation, ownership changes and failed efforts to become a leader in the handheld market.

Palm, founded by Donna Dubinsky and Jeff Hawkins in 1992, helped create the handheld computing market with its Palm Pilot "personal digital assistants" in the 1990s. But after Palm reshuffled itself repeatedly -- it was bought by U.S. Robotics, a modem maker that itself was bought by 3Com Corp. in 1997, and then spun off again as its own company in 2000 -- other companies took control of the market. In 2003, Palm acquired Handspring -- a rival startup Dubinsky and Hawkins created-- and spun off PalmSource, which made the PalmOS handheld computing software, as an independently traded company. Japan's Access Co. bought PalmSource in 2005.

Speaking to The AP several months before HP announced it was buying Palm, Dubinsky said all the shuffling took "critical resources and attention from product development." And even though it happened years ago, she called the decision to spin off PalmOS a "huge strategic error."

Since Palm's comeback attempt, the popularity of the iPhone has only grown while phones running Android, which first hit the market in 2008, abound. According to research firm IDC, Apple took the top spot in the second quarter, while Samsung Electronics Co. -- a big maker of Android phones-- took second place in unit sales. Nokia Corp. came in third, while BlackBerry maker Research In Motion Ltd. took fourth.

Rubinstein, currently a senior vice president of HP's personal systems group, said Palm studied a number of alternatives to being bought by HP. He said HP was a good choice because, as the largest computer company in the world, it could help Palm bring its products to more people.

As it turns out, the mobile pioneer will largely cease to exist.

McGraw-Hill, Moody’s Risks Rise After S&P Cut

2011-08-09T17:04:00.004-04:00

Standard & Poor’s increased the risk of investing in the bond-rating service’s owner and its biggest
competitor by taking away the U.S.’s AAA designation, according to Peter Appert, a Piper Jaffray & Co. analyst.

The chart above compares this year’s performance of McGraw-Hill Cos., S&P’s parent company, and Moody’s Corp. with the S&P 500 Index. Both are higher for the year even after they sustained bigger losses yesterday than the index, which tumbled 6.7 percent in its sharpest drop since December 2008.

McGraw-Hill and Moody’s face two threats because S&P cut the U.S. government to AA+, Appert wrote yesterday in a report.

The first is greater regulatory scrutiny of the rating industry, which has been criticized for flawed assessments of mortgage- backed securities during the past decade’s housing bubble.
“The perception in Washington that the rating agencies have too much power and must be ‘reined in’ will undoubtedly by reinforced by S&P’s decision,” he wrote.

The second risk is that bond sales may become more volatile as the lower rating helps slow economic growth, the report said. Assuming that occurs, revenue and earnings at McGraw-Hill and Moody’s would become less predictable as well.

These issues weren’t big enough to prompt Appert to reduce his ratings on McGraw-Hill and Moody’s. He has the equivalent of a “buy” recommendation on both stocks, which he sees as cheap by comparison with projected earnings. Yesterday’s closing prices were about 11.5 times his profit estimates for next year.

Dow Jones industrial average's worst days since 1899

2011-08-08T20:58:00.002-04:00

The Dow Jones industrial average plunged 634 points, or 5.6 percent, to 10,810 on Monday.

Here's a look at the Dow's 10 worst days since 1899:

By percent decline:

Oct. 19, 1987: 22.6 percent, or 508 points
Oct. 28, 1929: 12.8 percent, or 38.33 points
Oct. 29, 1929: 11.7 percent, or 30.57 points
Nov. 6, 1929: 9.9 percent, or 25.55 points
Dec. 18, 1899: 8.7 percent, or 5.57 points
Aug. 12, 1932: 8.4 percent, or 5.79 points
March 14, 1907: 8.3 percent, or 6.89 points
Oct. 26, 1987: 8 percent, or 156.83 points
Oct. 15, 2008: 7.9 percent, or 733.08 points
July 21, 1933: 7.8 percent, or 7.55 points

By points:

Sept. 29, 2008: 777.68 points, or 7 percent
Oct. 15, 2008: 733.08 points, or 7.9 percent
Sept. 17, 2001: 684.81 points, or 7.1 percent
Dec. 1, 2008: 679.95 points, or 7.7 percent
Oct. 9, 2008: 678.92 points, or 7.3 percent
Aug. 8, 2011: 634.76 points, or 5.6 percent
April 14, 2000: 617.78 points, or 5.7 percent
Oct. 27, 1997: 554.26 points, or 7.2 percent
Oct. 22, 2008: 514.45 points, or 5.7 percent
Aug. 4, 2011: 512.61 points, or 4.3 percent
Aug. 31, 1998: 512.61 points, or 6.4 percent

Source: Dow Jones Indexes, a division of CME Group Inc.

Developed country risk index Q3 2011

2011-08-08T11:43:00.003-04:00

S&P500 - Fri 8/5/11 after jobs report (117k new jobs)

2011-08-05T10:06:00.004-04:00

I am waiting for a MACD crossover (similar to A) to establish a long position.
Below is a 2-year weekly chart of S&P 500.

Billionaire Slim Loses $8 Billion in Four Days as Mexican Holdings Suffer

2011-08-05T01:14:00.005-04:00

Carlos Slim, the world’s richest man, lost about $8 billion this week.

The Mexican billionaire’s stock portfolio, measured in U.S. dollars, has dropped about 11 percent since July 29, before today, and is valued at about $63 billion, according to data compiled by Bloomberg. That compares with a 7.1 percent slide in the Standard & Poor’s 500 Index.

Slim, 71, has taken a hit as Mexico’s benchmark IPC index dropped 7.4 percent and the peso slid 2.5 percent against the dollar on concerns that the flagging U.S. economy will hurt demand for assets in its southern neighbor. The removal of three of Slim’s companies from the IPC index has made matters worse for the billionaire.

“He’s been particularly hurt by those companies leaving the IPC,” said Leon Cabrera, a trader at Mexico City-based Vanguardia Casa de Bolsa. “It reflects the nervousness out there. It’s part of being in the market.”

America Movil SAB, the biggest wireless carrier in the Americas and Slim’s largest asset, has declined a relatively benign 6.9 percent this week. Its Telefonos de Mexico SAB unit has been Slim’s only gainer in Mexico, rising 11 percent on the parent company’s offer to buy out minority shareholders.

The Standard & Poor’s index extended its decline today, falling 0.5 percent at 9:58 a.m. New York time. The IPC fell 0.5 percent, and America Movil slid 0.9 percent.

Buying Opportunity

The drop in America Movil, which has fallen 21 percent this year as regulators seek to put a dent in its 70 percent share of Mexico’s mobile-phone market, is an opportunity for investors to buy stock in a solid company, Cabrera said yesterday in a telephone interview.

Even measured in Mexican pesos, Slim’s holdings have dropped 9 percent this week, a bigger decline than the broader Mexican market. Bolsa Mexicana de Valores SAB, the Mexican stock exchange operator, said Aug. 2 that it would drop Slim’s Grupo Financiero Inbursa SAB, Inmuebles Carso SAB and Grupo Carso SAB from the IPC index as part of an annual rebalancing.

Inbursa, Slim’s financial-services firm, slid 8.7 percent this week, while Inmuebles Carso, a real estate firm, declined 11 percent, and Grupo Carso, a holding company with retail and construction units, fell 18 percent.

Slim was named the world’s richest man for a second year in a row by Forbes magazine in March. Bill Gates and Warren Buffett, second and third on the magazine’s list, have had better weeks, at least for their biggest holdings.

Carlos Slim Helu
Age: 68
Fortune: self made
Source: telecom
Net Worth: $60.0 bil
Country Of Citizenship: Mexico
Residence: Mexico City , Mexico, Latin America
Industry: Communications
Marital Status: widowed, 6 children

Swiss Franc vs gold vs Japanese yen, 3 month chart

2011-08-04T14:12:00.002-04:00

S&P 500 head & shoulders pattern developing?

2011-08-02T17:28:00.002-04:00

The S&P 500 turned negative for the year Tuesday as the wrangling over the U.S. debt ceiling faded and investors turned their attention to the stalling economy. Looks like the S&P 500 maybe heading for more losses in the coming days.

Here's an 18-month S&P 500 chart (weekly)

Safe-haven Swissie soars

2011-08-02T15:50:00.000-04:00

Franc soars to a record high versus the euro and trades near an all-time high against the dollar on global growth and debt concerns.

Performance gold vs silver - 3 months

2011-08-02T13:52:00.000-04:00

Rue La La Chicago to challenge Groupon

2011-08-02T09:13:00.000-04:00

(Reuters) — Rue La La, an online flash-sales company partly owned by eBay Inc., is expanding its local offers business, stepping up competition with Groupon and LivingSocial.

Rue Local will offer one deal a day on local products, services and events in San Francisco, Chicago and Miami. That adds to current locations in New York City, Los Angeles and Washington DC, Boston, Philadelphia and Seattle.

Rue San Francisco is set to launch on Wednesday. Rue Miami will start Aug. 9 and Rue Chicago later this month.
Rue La La started as a fashion flash-sales website, offering discounts on women's apparel for very short periods. It has added men's clothing, home goods and other products since then.

With Rue Local, the company is trying to offer its members more products and services in a similar way to daily deal leaders Groupon and LivingSocial, part owned by Amazon.com. Flash-sale company Gilt Groupe, which initially focused on high-end fashion, has expanded in the daily deal area too, with Gilt City.
"We're trying to cover everything for members, to be an editor for people's lives," Mark McWeeny, president of Rue Local, said in a recent interview with Reuters.

Rue La La has over four million members and almost two million of those have signed up for Rue Local offers.

Rue La La was owned by GSI Commerce, an e-commerce company that was acquired by eBay this year. After the deal, eBay said it would sell 70 percent of Rue La La to a new, private holding company run by GSI chief executive Michael Rubin.

Groupon launches a partnership with Foursquare

2011-07-30T09:18:00.000-04:00

Groupon Inc. has launched a long-expected partnership with mobile social-media site Foursquare.

GrouponNow, the daily deal company’s location-based and time-limited offers, will appear on Foursquare, Chicago-based Groupon said on its blog Friday.

Foursquare offers its own discounts with merchants to users who check in at businesses using its mobile-phone app. But the New York-based company recently created partnerships with Groupon competitors LivingSocial, Gilt City, AT&T Interactive, BuyWithMe and Zozi.

E-Trade’s Up On Report Capital One Considered Bid

2011-07-30T09:06:00.000-04:00

Shares of E-Trade Financial (ETFC) rose 1.2% today and are up slightly in after-hours following a report that the online broker was pursued by Capital One Financial (COF) last fall, according to Dow Jones Newswire.

While a formal bid never materialized, the discussions apparently inspired hedge fund manager Ken Griffin — who’s on ETFC’s board — to push the firm to sell itself.

Griffin is founder and CEO of Citadel LLC, E-Trade’s largest shareholder. Last week, a filing revealed his displeasure at the way E-Trade’s being managed. The company has rejected Griffin’s demands that it look for new ownership. At the same time, E-Trade has agreed to hire Morgan Stanley (MS) to “conduct another broad review of strategic strategies.”

Dollar tanks vs Swiss franc, yen on economic fears

2011-07-29T21:20:00.002-04:00

The dollar sank to an all-time low against the Swiss franc and a four-month trough versus the yen on Friday as weak data on U.S. economic growth ignited fears the economy could slip into another recession.

Debt worries on both sides of the Atlantic prompted investors to seek refuge in the franc and yen, traditional safe havens. However, the greenback gained against commodity-linked currencies that typically struggle when there is heightened risk aversion, such as the Australian, Canadian and New Zealand dollars.

The dollar's slide against the Swiss franc and yen accelerated after data showing the U.S. economy grew at a much weaker-than-expected rate in the second quarter. First-quarter growth was also revised sharply lower.

India’s 55 billionaires command nearly $250 billion in wealth

2011-07-27T00:25:00.000-04:00

India’s 55 billionaires command nearly $250 billion in wealth — a staggering sum relative not only to the country’s gross domestic product, but to peers in bigger economies. More than 60 percent of India’s billionaire wealth — $154.8 billion — resides with just 11 individuals or families, according to Forbes rankings for 2011:

Stock market cartoons

2011-07-22T14:23:00.000-04:00

Hedge Fund Withdrawals At Highest Since 2009

2011-07-14T14:03:00.000-04:00

Investors withdrew more money from hedge funds than at any point since October 2009 last month, reflecting ongoing difficulties in the global equity markets, GlobeOp data shows.

The firm said that hedge fund flows measured by the GlobeOp Capital Movement Index were negative 0.2 percent in July. The index charts month net subscriptions and redemptions among GlobeOp's fund administration clients, who represent between eight and 10 percent of the global hedge fund industry.

GlobeOp's figures are the latest signal that hedge funds are struggling amid broader concerns about the health of the world economy. Earlier this month, Hedge Fund Research reported that the average hedge fund rose only 0.76 percent through the first half of 2011, while the HFRX Global hedge fund index dropped 2.12 percent over the same period.

However GlobeOp Chief Executive Hans Hufschmid says his firm's data also points to the notion that the half-year point is typically when investors review and recalibrate their overall capital allocations.

"From a quarterly perspective, the outflows at the last four quarterly closes have been remarkable and steady, including this one," Hufschmid said. "Though it's been equally difficult for equity markets and hedge funds in recent months, I think the market has done quite well considering the circumstances."

Schwab to Offer Trading in 12 Foreign Markets

2011-07-14T13:54:00.002-04:00

Charles Schwab announced plans to significantly enhance its global investing offer through a strategic relationship with Broadridge Financial Solutions, a provider of securities processing and business process outsourcing (BPO) solutions for financial services firms.

It will let customers trade stocks and currencies in 12 foreign markets starting next year
Charles Schwab wants to capture investors' growing appetites for broadening their exposure beyond the United States.
Broadridge will provide the technology needed to support currency trade processing, accounting and reporting, according to a release.

NEW YORK - Charles Schwab Corp said it will let customers trade stocks and currencies in 12 foreign markets starting next year to capture investors' growing appetites for broadening their exposure beyond the United States.

The largest online brokerage said Broadridge Financial Solutions, a securities processing and outsourcing company, will help Schwab customers trade in multiple markets and seven non-U.S. currencies starting in the 2012 first quarter.

Trading initially will be offered in Australia, Belgium, Canada, France, Germany, Hong Kong, Italy, Japan, Netherlands, Norway, Portugal and the UK. New currencies include the Australian, Canadian and Hong Long dollars, plus pounds sterling, Japanese yen, euros and Norway's kroner.

Fidelity Investments almost two years ago began offering stock trading to retail investors in 16 currencies and 25 countries, and Bank of New York Mellon's Pershing and other clearing firms also provide a forex capability to many broker-dealers.

Schwab has been expanding investing services as a growing number of customers seek higher-growth markets as well as a hedge against U.S. dollar weakness.

Last autumn, Schwab introduced trading in over-the-counter equities outside the United States, spurring a 300 percent jump in the first quarter in foreign stock trading from compared with a year earlier.

To accompany the new trading capabilities, Schwab said it will introduce global macro-economic research and currency commentary from in-house and third-party experts, as well as 24-hour customer service.

Warren Buffett eyes Groupon, Exelon, ADM

2011-07-11T18:48:00.000-04:00

(Crain's) — Renowned investor Warren Buffett will read Groupon Inc.'s filings for an initial public offering, according to a report.

Mr. Buffett told Bloomberg TV he hopes to buy another company this year and that Chicago-based Exelon Corp. and Decatur-based Archer Daniels Midland Co. are the types of firms that interest him.

He declined to comment on specific targets to Bloomberg TV.

Chicago-based Groupon, a daily-deal coupon site, filed last month for an IPO.

Warren Buffett : Congress is playing Russian roulette

2011-07-09T13:21:00.002-04:00

Warren Buffet and Astrid Buffet head to lunch after morning sessions during the 2011 Allen and Co. Sun Valley Conference, Friday, July 8, 2011, in Sun Valley, Idaho.

SUN VALLEY, Idaho -- Billionaire investor Warren Buffett accused Congress of playing Russian roulette with the country's credit-worthiness and offered his own novel suggestion for ending the budget deficit in an interview with CNBC on Friday.

"I could end the deficit in five minutes," Buffett said in the interview from a technology and media conference in Sun Valley, Idaho. "You just pass a law that says that anytime there is a deficit of more than 3 percent of GDP all sitting members of Congress are ineligible for reelection."

"We raised the debt ceiling seven times during the Bush administration and now in this administration they're using it as a hostage," the chairman and CEO of Berkshire Hathaway said of Congress. "You really don't have any business playing Russian roulette to get your way in some other matter. We should be more grown-up than that."

Buffett said "the odds are very good" that nothing catastrophic would occur if the US misses its August 2 deadline to raise the debt ceiling.

"On the other hand," he added, "you're playing with fire when you don't need to play with fire and we don't need to tell the rest of the world that anytime people in Congress start throwing a tantrum, that we're not going to pay our bills."

"It is not a great pattern to project to the rest of the world," he said.
Buffett said his message -- which he reduced to "shame on all of you" -- was directed to both Republicans and Democrats. "There's plenty of blame to go around," he said.

In the event that Congress fails to raise the borrowing limit, Buffett said an option of withholding checks from Social Security recipients would not only hurt Americans living "hand-to-mouth" but also shake the country's sterling AAA credit rating.

"If you don't send out Social Security checks, I would hate to think about the credit meeting at [rating agencies] S&P and Moody's the next morning," Buffett said. "If you're not paying millions and millions and millions of people, that range in age from 65 on up, money you promised them, you are not a triple A."

News Corp sells Myspace for $35 million

2011-07-03T21:40:00.001-04:00

The new owner, an Orange County digital media firm, paid a fraction of the $580 million that News Corp. paid for the once-dominant social network in 2005.
The number of monthly visitors to Myspace in the United States peaked in October 2008 at 76.3 million, but dwindled to about 35 million in May.

Myspace was once the Internet's equivalent of the hottest nightclub in town. In its heyday, the world's dominant social network attracted some 3 million bands, 8,000 comedians and countless filmmakers and wannabes who came to see and be seen.

Now, Myspace is seemingly no place — a digital castoff that corporate parent News Corp. sold for $35 million in cash and equity to an Orange County digital media firm specializing in online advertising. That's a fraction of the $580 million that the media giant controlled by Rupert Murdoch paid to acquire the site a scant six years ago, and well shy of its one-time $65-billion valuation.

Its dramatic fall is both a consequence of the fickle nature of today's Internet generation as it is a tale of mismanagement, missed opportunities and miscalculations. Myspace's decline — hastened by its failure to match the innovations of its chief rival, Facebook, speaks to what can happen when a mainstream media company seeks to capture technological lightning in a bottle.

When News Corp. acquired Myspace in 2005, it was the fifth-most-popular destination on the Internet, a place where hot musical acts like Fall Out Boy went to connect with fans and release new albums.

The decision to acquire the hot social networking site landed Murdoch on the cover of Wired magazine, where he was lauded for embracing the Internet ahead of his old-media rivals, although critics ridiculed him for overpaying.

But, the acquisition seemed to pay instant dividends to News Crop. One year later, Google Inc. agreed to pay $900 million for the exclusive right to provide a search function on Myspace and sell advertising associated with the results. By 2007, Myspace was the leading social network, attracting nearly 100 million monthly users around the globe. It had grown so influential that Barack Obama and other 2008 presidential candidates created campaign pages on the site.

But Myspace's red-hot success was short-lived.

The number of monthly visitors in the United States peaked in October 2008 at 76.3 million, according to measurement firm ComScore Digital Analytix. Over the last two years, the social network has shed an average of 1 million users a month, and its monthly traffic had dwindled to about 35 million users by May.

As Myspace's users headed for the exits, so did the advertisers. Researcher EMarketer projects Myspace's ad revenue at $184 million this year, down from $470 million in 2009. Myspace proved a drag on News Corp.'s earnings, with the division that includes the social network posting a profit only once in the last six years.

News Corp. attempted to reverse Myspace's slide; replacing co-founders Chris DeWolfe and Tom Anderson with a top executive from its chief competitor Facebook, Owen Van Natta. But Van Natta departed in less than a year, as did one of the two men named to succeed him as co-presidents, MTV veteran Jason Hirschhorn.

A lack of a single, unified vision for Myspace hampered the social network, which was slow to respond to the rapidly evolving technological landscape.

"The reason Facebook has consistently [drubbed Myspace] is [Facebook Chief Executive] Mark Zuckerberg owns product strategy," said Mark Suster of GRP Partners, a leading venture capital firm in Southern California. "When the company needs to turn on a dime, they're able to do so. You don't get this quagmire of bureaucracy."

Myspace's management turmoil delayed the promised relaunch of the struggling site, which continued to hemorrhage users and advertisers and lose money. The inability to stop the slide set the stage for Tuesday's sale to Specific Media, a little-known advertising network in Irvine.

Michael Birch, the founder of the Bebo social network, said News Corp. remained focused on monetizing the site instead of constantly innovating to become a huge social network.

"The problem with Myspace was that it was never as strong a product as it needed to be," Birch said. "It left itself vulnerable to competition. It was only a matter of time before someone created something bigger."

Myspace's new owners hope to find a way to reinvigorate the flagging site, which continues to attract a sizable online audience.

To cut overhead in anticipation of the sale, Myspace began laying off about half of its 500 or so employees Wednesday. The company's chief executive, Mike Jones, informed his staff that he would step down immediately but would remain an advisor until late August to help with the transition. News Corp. is taking a 5% stake in Specific Media.

Irvine-based Specific Media, founded in 1999 by Tim Vanderhook and his brothers Chris and Russell, has built a digital business around helping marketers buy ads on websites, mobile devices and Internet TV. Under new ownership, Myspace is expected to return the site's focus to its musical roots. The company has recruited Grammy-winning artist Justin Timberlake to guide its new creative direction and strategy and return some star power to the site.

KKR, Silver Lake to buy Go Daddy for $2.25 billion

2011-07-01T22:56:00.001-04:00

(Reuters) - Web hosting company The Go Daddy Group Inc agreed to be bought by a private equity consortium led by KKR and Silver Lake for $2.25 billion, including debt, people close to the situation said on Friday.

The decision to sell will give Go Daddy access to deep-pocketed backers to buy other firms and broaden its presence internationally, Go Daddy's founder Bob Parsons told Reuters in an interview.

Parsons said using the private equity buyers knowledge of the public markets would eventually aid in the company's IPO should it take that path.

The private equity buyers also include Technology Crossover Ventures. Go Daddy announced the deal but did not disclose the terms.

The buyers were willing to finance the buyout with a larger equity portion than debt, Herald Chen, head of KKR's software and Internet effort told Reuters.

"There is more equity than debt going into the deal because this is a growing company and a growth investment for the investment group, Chen said.

Parsons and the company's board of directors decided to hire Frank Quattrone's Qatalyst Partners during the summer of last year after receiving numerous calls of interest from parties looking to buy the company.

"We have talked to a number of firms and eventually we met the combination of KKR and Silver Lake and just absolutely was amazed what they brought to the table," Parsons said.

Since founding the company in 1997, Parsons has seen Go Daddy grow into the world's largest Web hosting provider, serving more than 9.3 million global customers and managing more than 48 million domain names.

Go Daddy has over 3,000 employees, with roughly 500 dedicated to product development.

"Building on Go Daddy's exceptional customer service and loyal customer base, we believe there is significant opportunity to expand the current portfolio of products and services as well as accelerate growth internationally," Chen said in a company press release on Friday.

Go Daddy filed to go public in 2006, but at the time was told that it would be required to take a 50 percent haircut -- a percentage that is subtracted from the par value of assets that are being used as collateral -- on its initial public offering.

The company instead decided to pull its filing citing unfavorable market conditions, Parsons said.

"We grew by 22 percent during the recession and our growth hasn't slowed," he said.

Parsons, who is currently chief executive officer, will become executive chairman of Go Daddy, while current President and Chief Operating Officer Warren Adelman will move into the role of CEO, Parsons said.

Barclays Capital, Deutsche Bank Securities Inc and RBC Capital Markets acted as financial advisors and, along with KKR Capital Markets, they or their affiliates provided financing commitments for the transaction.

Analyst: Revenue from app stores to top $36B in 2015

2011-06-30T09:28:00.000-04:00

Total revenue from app stores like the Apple App Store and Android Marketplace will nearly double to $14.1 billion next year and will reach $36.7 billion by 2015, according to tech research firm Canalys.

App Stores are expected to bring in $7.3 billion in revenue in 2011, which includes direct app purchases, in-app purchases and subscriptions, Canalys said.

The overwhelming number of apps on the Apple App Store and Android Marketplace might prove too daunting for consumers. That could create an opportunity for phone carriers like AT&T and Verizon Wireless to set up customized app stores that suggest apps based on user data, the firm said. Carriers have better access to phone-use data, which gives them a clearer picture of phone owner’s habits.

Apple currently takes a 30 percent cut from all transactions for in-app purchases and in-app subscriptions. Apple also takes a 30 percent cut of the sales of paid applications. The Apple App Store has more than 425,000 apps.

The iPhone manufacturer says it has sold more than 200 million iOS devices, making iOS the number one mobile operating system. Apple sold more than 25 million iPads in its first 14 months on sale. iPhone and iPad owners have downloaded more than 14 billion apps from the App Store in less than three years. Apple has also paid out more than $2.5 billion to developers building apps for the App Store.

Google+ challenges Facebook in social networking

2011-06-29T10:12:00.001-04:00

Online search giant Google has launched a new social networking website in its latest attempt to take on Facebook, which now claims more than 500m users. Google+ allows individuals to share photos, messages and comments but also integrates the company's maps and images into the service.

It also aims to help users easily organise contacts within groups.

But some analysts say Google has simply reproduced features of Facebook while adding a video chat function.

Google, which handles roughly two out of every three internet searches in the US, has taken several stabs at Facebook in recent years.

But its previous efforts ended in failure, with both Google Wave and Google Buzz proving unpopular with users.

New functions
The company is now boasting that four features in Google+ could help make the company a permanent player in social networking:

Circles - a functionality that allows individuals to place friends into groups, allowing users to share different forms of content with targeted clusters of friends
Hangouts - live multi-user video conferencing that permits friends to drop in and out of live group conversations
Huddle - group instant messaging
Sparks - a feature that connects individuals on the network to others with common interests.
The current version of Google+ has only been released to a small number of users, but the company has said it soon hopes to make the social network available to the millions of individuals that use its services each day.

High Net Worth Individuals Pulling Out Of Hedge Funds

2011-06-28T18:23:00.000-04:00

Hedge funds have surpassed the magic $2 trillion mark. And new hedge fund launches have reached their highest levels since 2007, with nearly 300 hedge funds launched in the first quarter of this year, according to HFR.

However, one group seems reluctant to participate in this renewed euphoria: high net worth individuals.

According to the recently released Capgemini and Merrill Lynch Global Wealth Management 2011 World Wealth Report, just 5 percent of the HNWI set’s assets were found in alternatives investments—hedge funds, structured products, derivatives, foreign currency, commodities, private equity, venture capital at the end of 2010. This was exactly half the 10 percent allocation made in 2006. (HNWIs are defined as those having investable assets of US$1 million or more, excluding primary residence, collectibles, consumables, and consumer durables.)

What’s more, the exposure has steadily declined since the peak.

And within the alternatives group, hedge funds are not exactly the favored asset class.

According to the survey, commodity investments accounted for 22 percent of all alternative investments made by HNWI in 2010, up from just 16 percent the prior year. Foreign currency holdings climbed to 15 percent of all alternative investments in 2010 from 13 percent. “Investors bought into currencies where country interest rates were higher than in the developed markets of the U.S. and Europe,” the report notes.

On the other hand, hedge-fund holdings declined to 24 percent from 27 percent in 2009. The report points to a Hedge Fund Research report that stressed most of the hedge fund inflows in 2010 took place at the end of the year.

Investors are apparently still spooked from the days of the financial meltdown, when many of their funds of funds investments performed poorly. And many hedge funds gated their assets, preventing them from redeeming.

“High net worth individuals are looking for liquidity,” confirms William Sullivan, Global Head of Market Intelligence, Capgemini Financial Services. “Their top priority is preserving capital.”

This sentiment is also underscored by the increased allocation to cash and fixed income investments in recent years. The report found that HNW individuals held $18.6 trillion or 43.5 percent of all their assets in conservative instruments such as fixed-income and cash/equivalents, up from 35 percent in 2006, even though global equity-market capitalization had risen 18 percent in 2010 and 46.3 percent in 2009. This reflects an underlying uncertainty that markets will remain stable and that the financial crisis is over and fear that new and unforeseen systemic shocks could emerge, the Cap Gemini/ML report emphasizes. “HNW investors are not easily convinced that alternative or emerging opportunities are worth the risk,” the report adds.

The declining commitment to alternatives among HNWI contrasts with that of institutional investors. According to a recent Preqin survey, 30 percent of institutional investors said they will definitely invest more capital in hedge funds over the next three years and 64 percent are considering doing so.

And in March, Preqin reported a 50 percent rise in public pension plans investing in hedge funds.

And earlier this year, hedge fund consultant Cliffwater noted that endowment allocations to alternatives exceed 50 percent of assets, up from 37 percent before the financial crisis. It added that hedge funds now account for 3 percent of total public pension assets and 18 percent of alternative assets, up from 2 percent and 15 percent, respectively, in fiscal 2009.

The world’s largest container ports

2011-06-28T01:08:00.000-04:00

THE changes in distribution and cargo-handling capabilities of the world's biggest container ports show the shifts that the world economy has undergone over the past two decades. The volume of cargo traded through the world’s biggest container ports has increased nearly sixfold in the past 20 years as globalisation has taken hold. Singapore has now nabbed the top spot and every other big port in 1989 has moved down the list. Twenty years ago more than half of the top 20 container ports were in America or Europe reflecting imports into both regions from around the globe. Now, Asia's strength as an exporter is more in evidence. Fourteen of the top 20 container ports are in that region, with eight in China.

US Healthcare : Estimated waste in American health-care spending

2011-06-28T01:01:00.002-04:00

AMERICA has a talent for wasting money on health care. It has devised many ingenious ways to do this. A patient may see many skilled specialists, none of whom co-ordinate with one another. Payment systems are unfathomably complex and highly variable. Doctors order duplicative or unnecessary tests. The country excels at treating sick people and does a horrible job keeping them from getting sick in the first place. All these problems, however, are due to a simple, structural failing: the more services a hospital provides, the more it is paid.

Lexus, Honda top J.D. Power Initial Quality Survey, Ford plummets

2011-06-23T18:32:00.001-04:00

Survey shows new car quality declines significantly.

Despite being caught in the undertow of Toyota's recall and safety issues last year, Lexus tops J.D. Power and Associates' Initial Quality Study (IQS) as the best brand in the survey being released today. Even better, Lexus' flagship LS sedan had the fewest problems of any vehicle in the first 90 days of ownership.

Meanwhile Ford, which was fifth last year and the only mass-market brand in the top five, fell to 23rd this year. It had 116 problems per 100 vehicles,up from 93 last year and worse than the industry average of 107 owner-reported problems. Its Lincoln brand dropped from No. 8 to 17 this year, with 111 problems.

Power attributed Ford results partly to two specific issues about which owners have complained: complicated MyFord Touch communications controls and other controls and a dual-clutch automatic that some owners found balky and unpredictable.

Power also said new technologies were an increasing problem for all makers. While the overall industry average improved to 107 from 109 problems last year, the IQS scores for models all-new or with major redesigns was 10% worse: an average of 122 problems, up from 111 last year. Carryover or lightly freshened models, by contrast, improved to 103 from 108.

"Exciting models with the latest features are crucial for winning over today's demanding consumers," said David Sargent, vice president of global vehicle research at J.D. Power and Associates. "However, automakers must not lose their focus on the importance of these models also achieving exceptional quality levels. Expected reliability continues to be the single-most-important reason why new-vehicle buyers choose one model over another."

Said Edmunds.com Senior Analyst Michelle Krebs, "Ford was not surprised by today's results; Ford knew that people were finding the MyFord Touch problematic. The engineers who designed the system are more technically inclined than the average user. Ford engineers need to take a step back to understand what is intuitive for the typical driver."

She added that all "automakers are tweaking their engines and transmissions to maximize fuel economy, but their experiments have taken their toll in terms of the driving experience and quality ratings are suffering as a result."

Asia Now Has More MIllionaires Than Europe, Closing In On North America

2011-06-23T13:52:00.002-04:00

HONG KONG -- Booming Asia had more millionaires than Europe for the first time last year and is fast closing in on North America for the top spot, a report released Thursday said.

The Asia-Pacific region was home to 3.3 million people in 2010 worth $1 million or more, excluding their homes, an increase of roughly 10 percent from the year before, according to the 15th annual World Wealth Report by Merrill Lynch's wealth management division and consultancy Capgemini.

Asia's growth outpaced Europe, where so-called high net worth individuals increased 6 percent to 3.1 million, and puts it within reach of North America, where the number of wealthy rose 8.6 percent to 3.4 million.

The report's findings illustrate how Asia's economies are growing much more quickly than developed countries and, in the process, minting scores of new millionaires and billionaires. Asia's growth has been powered by China and India, whose economies grew 9-10 percent last year while European and North American growth was in the low single digits.

"It is entirely conceivable that Asia would overtake North America in the near future," said Wilson So, a managing director at Merrill Lynch Global Wealth Management. "I would be surprised if that does not happen very soon."

The U.S., Japan and Germany still account for just over half the world's 10.9 million wealthy, while China is in fourth place with 535,000, about 58,000 more than in 2009. Australia has moved up one notch to ninth place, edging out Italy, while India cracked the top 12 for the first time. It replaced Spain, which fell to 14th.

While 2010 was the first time that Asia has overtaken Europe in absolute numbers of wealthy people, it is the second year that Asia's combined wealth was bigger than Europe's.

The world's wealthy were worth a total of $42.7 trillion in 2010. Asia's share of that wealth amounted to $10.8 trillion, putting it in second place for the second year in a row, just behind North America's $11.6 trillion.

Six of the 10 economies with the fastest growing millionaire populations were in Asia, led by Hong Kong and Vietnam, which each saw annual growth of 33 percent. Others included Sri Lanka, Indonesia, Singapore and India.

Asia also had a bigger proportion of young millionaires, with 3 percent aged 30 or under. All other regions had 2 percent or less.

Globally, women are increasingly in the ranks of millionaires. The report found that 27 percent of the world's wealthy last year were women, up from 24 percent in 2009.

While the majority of wealth is held by Americans, Japanese and Germans, the authors of the report expect the distribution to become more diverse over time as developing countries continue to grow faster than developed ones.

The superrich, defined as people worth more than $30 million, also fared well. Their numbers grew 10 percent to 103,000 last year.

Switzerland has the highest concentration of rich people; America has the most in absolute terms

Apprentice contestant James Sun working on mobile deals with Microsoft

2011-06-23T13:47:00.000-04:00

Former reality-show contestant James Sun is working on a mobile deals app with Microsoft.

The app, which will launch in July, will offer mobile deals at Seattle restaurants. Microsoft's Tag group is designing the graphic codes similar to bar codes designed to be scanned by a mobile phone at the restaurant.

The application is similar to deals website Groupon in that it offers deals for a limited time, but it lets restaurants manage it more closely so they aren't crushed by a stampede of people who all want to redeem their coupons at the same time.

People can download the app, search what deals are closest to them and select one. To redeem the coupon, they go to the restaurant and scan the code at the restaurant with the phone. It will be available for the iPhone and Android phones.

Sun is chief executive of a Kirkland company called Pirq which he started in the spring. He previously was a contestant on the sixth season of the television show "The Apprentice."

Restaurants that will offer the deals in July include Sip, 13 Coins, Desert Fire, Red Mango and Cupcake Royale.

People can sign up for accounts now at www.pirq.com.

Top 10 expected Android devices

2011-06-22T16:58:00.000-04:00

The future of the Android operating platform looks promising. Here is a list of the top 10 forthcoming Android devices:

Motorola Droid Bionic: A successor to Droid Incredible, the device will have a 1GHz NVIDIA Tegra 2 AP20H dual-core processor and a LTE (Long Term Evaluation) connectivity. The new Bionic is particularly built for speed and will come with an 8 mega-pixel camera. The release date is not fixed, but is expected before the end of 2011.

Toshiba Thrive: The tablet’s specialty will be full-size USB port. It will also have a SD card slot and a HDMI (High-Definition Multimedia Interface) port and will also consist of a dual-core processor. The release date of the device is rumored to be around July.

Samsung Galaxy Tab 10.1 (LTE): Although the Wi-fi only Galaxy Tab is set for June 17th release, the LTE version will be debuting sometime this summer. The device is expected to give Apple iPad 2 a tough competition. Verizon’s fast LTE network will make web browsing easier and faster than before.

Motorola Photon 4G: This will be the company’s first WiMAX-capable phone. The phone will have a dual-core processor like Atrix on AT&T. The phone will run on an Android 2.3 (Gingerbread) platform. The device can also be connected to a TV to play games on a larger screen.

Asus Padfone: Asus has made it possible to connect your smartphone to the tablet. Once the phone is mounted beside the device, all the phone’s features can be accessed from the tablet.

Motorola Xoom 2: Rumors say that the tablet will have a Tegra 3 quad-core processor which will make it the most powerful and efficient tablet on the market. No solid news is available at the moment about the device but will be a worthy successor to the company’s 10.1-inch tablet.

Nexus 3: Nothing much is available about this mythical device as of now, but is expected sometime in the fourth quarter of 2011. The Nexus 3 will become one of the first phones to have the Ice Cream Sandwich version of the Android operating system. The OS is expected to link the gap between Android tablets and Android handsets. The phone is expected to bring radical changes to the Android OS platform.

HTC EVO 3D: As per the name suggests, the phone will have a 3D display and will capture 3D images. The phone is expected to have an interesting impact on the market. Exposure to long-term 3D exposure, however, can be a source of prolonged headaches.

Samsung Galaxy S II: Europe may get to this one early while the US will have to wait for the device and its carrier. The device will boast a Super AMOLED Plus Display and a capacitive touchscreen, and will be dual-core powered. This phone promises to be a joy to behold.

Motorola Droid 3: The earliest Motorola Droid was the first in the new generation of Android devices in 2009. An improved keyboard and a high-resolution qHD display (a display resolution of 960 pixels by 540 pixels arranged in a 16:9 aspect ratio. This display is one-quarter of a full HD 1080p frame and is three-quarters of a 720p frame) with a dual-core processor is expected.

Verizon Killing Unlimited Data Plans

2011-06-21T15:02:00.000-04:00

Verizon will begin to roll out tiered data plans for new customers beginning July 7, 2011. According to DroidLife, the new plans will begin at $30 a month for 2GB of data. Other packages will include $50 for 5GB, or $80 for 10 GB.

Tethering will be another $20 for 2GB more. For those who hit the cap, Verizon will charge $10 for each GB over the limit. The plans are priced the same for both 3G and 4G plans. Unlimited plans had been offered at $30 per month. Verizon confirmed the change to All Things Digital.

Customers already on unlimited data plans will not be affected by the change. Verizon has long planned to turn to tiered plans, and has already started to throttle speeds for heavy data users.

DroidLife also says it could be possible current customers will be able to upgrade to new devices even after July 7 and hold onto unlimited data plans, though it's not yet been confirmed. For tablet users, data plans will increase to $30 per 2GB each month, up from the $20 for 1GB now offered.

Verizon joins AT&T, which already implements tiered plans. AT&T, however, offers plans at lower levels of data, including $15 for 200MB. For 2GB, the plan charges $25 a month and $45 for 4GB -- less than Verizon.

Verizon's minimum data plans for each month reflect an understanding that consumers are using more data than ever before. Average data consumption on smartphones has risen 89 percent in the past year.

Blue Cross profits surge

2011-06-20T14:06:00.001-04:00

The parent of Blue Cross & Blue Shield of Illinois raked in $1.1 billion in profit last year, a doubling of 2009's results that is likely to stoke the controversy over skyrocketing health insurance costs.

Chicago-based Health Care Service Corp. has kept up the torrid pace in 2011, with net income leaping by nearly two-thirds to $437 million in the first quarter from $275 million a year earlier.

The robust financial performance comes amid nationwide criticism of the health insurance industry, which is basking in record profits thanks to double-digit premium increases and reduced claims, as budget-minded consumers put off going to the doctor. Just this month, non-profit Blue Shield of California said it would take the rare step of refunding $167 million to customers and place a cap on future profits after an outcry about premiums and executive compensation.

Health Care Service, the largest health insurer in Illinois, with 44% of the market, could be facing similar pressure to reduce rates or refund premiums if its profits keep soaring and the company continues to dole out lucrative salaries to its executives, such as CEO Patricia Hemingway Hall, who was paid $8 million last year. Meanwhile, rising rates intensify concerns that many workers will lose their employer-sponsored benefits as the Obama administration's health care overhaul takes effect in 2014.

Blue Cross is increasing rates by 3% to 10% for employer-sponsored group plans this year after hikes of 20% or more last fall, estimates Nancy Daas, a partner in Chicago-based benefits consultant CMC Advisory Group.

Sondra Roberto, a staff attorney and health insurance expert at Yonkers, N.Y.-based non-profit Consumers Union, says, “Customers, particularly individual and small-group customers, should get the benefit of the company's financial strength through reduced rates, not higher rates. Instead, we have seen the company repeatedly raising rates—sometimes in the double digits.”

A Health Care Service spokesman says the company's rates are competitive with other insurers based on “quality, access to care and price.”

Blue Cross' profit rose as customers put off non-essential medical care.
But a new federal law this year that requires health insurance companies to pay out between 80% and 85% of premium revenue for medical benefits likely will force Health Care Service to issue rebates to some customers, according to a report in April by New York-based Citigroup Global Markets Inc.

The fourth-largest health insurer in the U.S., Health Care Service is the exclusive Blue Cross plan in New Mexico, Texas and Oklahoma, as well as in Illinois. Founded in Chicago in 1936, it is a mutual company, owned by its policyholders.

“As a non-investor-owned company, we can act as a positive force to keep rates reasonable in the markets where we operate because our primary objective is not to maximize profits,” the company spokesman says, noting that more than 90% of its customers renewed in 2010.

Last year's financial results “offer some evidence that we can dampen increases for 2011,” he adds, declining to comment on specific rates.

The 2010 financial performance is partly due to UniCare Inc.'s decision to exit Illinois and Texas, where Health Care Service is strong. The company struck a deal to take over UniCare's customers in those states, which resulted in 194,000 new insured members, according to Health Care Service's 2010 financial statement.

POMO schedule June 13 - July 11, 2011

2011-06-20T12:22:00.002-04:00

The Desk's tentative outright Treasury operation schedules for the purchases associated with the $600 billion purchase program announced by the FOMC on November 3, 2010 and for the purchases associated with the reinvestment of principal payments from agency debt and agency MBS announced by the FOMC on August 10, 2010.

Across all operations in the schedule listed below, the Desk plans to purchase approximately $62 billion. This represents $50 billion in purchases of the announced $600 billion purchase program, which will be completed by the end of June, and $12 billion in purchases associated with principal payments from agency debt and agency MBS expected to be received between mid-June and mid-July. As always, this schedule is subject to change should the FOMC choose to alter its directive to the Desk during the monthly period.

OPERATION DATE¹	SETTLEMENT DATE	OPERATION TYPE²	MATURITY RANGE	EXPECTED PURCHASE SIZE
June 13, 2011	June 14, 2011	Outright Treasury Coupon Purchase	08/15/2018 - 05/15/2021	$4 - $5 billion
June 14, 2011	June 15, 2011	Outright Treasury Coupon Purchase	12/15/2012 - 11/30/2013	$2.5 - $3.5 billion
June 15, 2011	June 16, 2011	Outright Treasury Coupon Purchase	12/31/2016 - 05/31/2018	$4 - $5 billion
June 16, 2011	June 17, 2011	Outright Treasury Coupon Purchase	06/30/2015 - 11/30/2016	$4 - $5 billion
June 17, 2011	June 20, 2011	Outright TIPS Purchase	04/15/2013 - 02/15/2041	$1.5 - $2.0 billion
June 20, 2011	June 21, 2011	Outright Treasury Coupon Purchase	08/15/2018 - 05/15/2021	$4 - $5 billion
June 20, 2011³	June 21, 2011	Outright Treasury Coupon Purchase	12/31/2013 - 05/31/2015	$4 - $5 billion
June 21, 2011	June 22, 2011	Outright Treasury Coupon Purchase	12/31/2016 - 05/31/2018	$4 - $5 billion
June 23, 2011	June 24, 2011	Outright Treasury Coupon Purchase	08/15/2021 - 11/15/2027	$1 - $1.5 billion
June 24, 2011	June 27, 2011	Outright Treasury Coupon Purchase	12/31/2013 - 05/31/2015	$4 - $5 billion
June 27, 2011	June28, 2011	Outright Treasury Coupon Purchase	06/30/2015 - 11/30/2016	$4 - $5 billion
June 28, 2011	June 29, 2011	Outright Treasury Coupon Purchase	08/15/2018 - 05/15/2021	$4 - $5 billion
June 29, 2011	June 30, 2011	Outright Treasury Coupon Purchase	08/15/2028 - 05/15/2041	$2 - $3 billion
June 30, 2011	July 1, 2011	Outright Treasury Coupon Purchase	12/31/2016 - 06/30/2018	$4 - $5 billion

Completion of $600 Billion Purchase Program
July 6, 2011	July 7, 2011	Outright Treasury Coupon Purchase	01/15/2014 - 06/30/2015	$2.5 - $3.5 billion
July 11, 2011	July 12, 2011	Outright Treasury Coupon Purchase	07/31/2015 - 12/31/2016	$2.5 - $3.5 billion

The next release of the approximate purchase amount and tentative outright Treasury operation schedule will be at 2 p.m. on July 13, 2011. At that time, the Desk will also publish information on prices paid for securities included in the operations listed above.

data from http://www.newyorkfed.org/markets/tot_operation_schedule.html#

Sears eyes moving HQ to Washington, D.C.

2011-06-20T11:20:00.001-04:00

(Crain's) — Sears Holdings Corp. has Washington, D.C., on its list as it shops around for a more tax-favorable state for its headquarters, according to a report.

The Hoffman Estates, Illinois-based retailer, which has expressed its dissatisfaction with recent Illinois legislation that hiked the corporate tax rate to 7%, has been asking about possible sites around the nation's capitol, according to a Washington Post report that cited two unnamed sources.

“Speculation about whether Sears will remain in Hoffman Estates is not fair to our associates, particularly so early in this process,” a Sears spokeswoman told the Washington Post in a statement.

Sears representatives were not immediately available to comment to Crain's.

Sears has also been in talks with North Carolina, Texas, Tennessee and New Jersey about moving, according to news reports.

Gov. Pat Quinn has said he would work with Sears to find a way to keep it from leaving Illinois.

The retailer is among 107 companies that will see tax breaks expire in the next three years, a situation that could lead to a number of defections.

Caterpillar Inc. and CME Group Inc. are other firms that have threatened to leave Illinois in recent weeks and months.

Mr. Quinn has already cut a deal with Motorola Mobility Holdings Inc. in which the state will grant the firm $100 million in tax breaks over the next decade if the mobile-phone manufacturer agrees to keep its headquarters in Libertyville. The cell-phone maker agreed to maintain 3,000 jobs in Illinois.

Mobile phone advertising skyrockets 128%

2011-06-20T11:10:00.000-04:00

ComScore Inc. (SCOR), a company specializing in business analytics, released a study that claims that the number of mobile display advertisements have more than doubled in the past two years.

The Reston, Va.-based research firm claims that mobile content and publishing accounted for half of all products advertised on mobile devices.

“Although mobile advertising is still in its relative infancy, it is quickly gaining importance as new advertisers come into the fold,” said Hans Fredericks, vice president of comScore. “The acceleration of mobile media consumption, driven by adoption of smartphones, 3G/4G networks and unlimited data plans, provides a ripe environment for advertisers looking to reach consumers through a variety of platforms including mobile browsers, apps and SMS. As consumer usage and technology continue to advance, look for advertising to play an increasingly important role in the development of the mobile ecosystem.”

In April 2011, 689 advertisers used mobile display advertising campaigns, up 128% from April 2009.

Of mobile ads, 50% were for mobile content and publishing, while 26% were for consumer discretionary goods, 7% for IT and 6% for financial services.

The mobile advertising arena is expected to grow as the number of consumers with smartphones also increases. Mobile users with a smartphone comprise 31% of all cell phone consumers, up from 20% the previous year.

Apple Inc. (APPL) and Google Inc. (GOOG) both have major stakes in the iPhone and Android markets respectively, and have large workforces and offices in Austin.

Percent of Advertised Categories via Mobile Display Advertising* 3 Month Avg. Ending Mar. 2011 Total U.S. Mobile Subscribers Ages 13+ Source: comScore Ad Metrix Mobile
	% of Advertised Categories
Mobile Content and Publishing	50%
Consumer Discretionary	26%
Information Technology	7%
Financials	6%
Telecommunication Services	5%
Consumer Staples	3%
Industrials	2%
Other	1%

Comscore reports Android tops and Blackberry drops in smartphone markets

2011-06-20T10:50:00.001-04:00

Google Inc.’s Android OS (GOOG) showed national dominance in a new report released by Reston, Va.-based Comscore (SCOR) that shows Apple Inc.’s (AAPL) iPhone overtaking Research in Motion Ltd.’s (RIMM) previous BlackBerry dominance in smartphone markets.

The report highlighted trends in the U.S. mobile phone industry during the three-month average period ending April 2011. The study surveyed more than 30,000 U.S. mobile subscribers.

Google’s Android accounted for 36.4% of U.S. smartphone users in April, up 5.2% from January. Apple moved up to No. 2, with 26% smartphone market share, up 1.3% from January. Research in Motion fell 4.7% to 25.7% of the smartphone market.

Phones running Microsoft Corp.’s OS made up for 6.7% of the smartphone market. Comscore said the original company to pioneer the smartphone, Palm, continued a decline, dropping from 3.2% of the smartphone market in January to a low 2.6% in April.

The study also found Samsung to be the top handset manufacturer overall with 24.5% market share. LG landed second with a 20.9% share and Motorola with a 15.6% share. Apple had 8.3% OEM market share and RIM rounded out the list at 8.2%.

Comscore said 74.6 million U.S. consumers owned a smartphone as of April, up 13% from January and that 234 million Americans ages 13 and older used mobile devices.

Einhorn Wins, Berkowitz Loses on St. Joe Drop

2011-06-15T14:53:00.001-04:00

(Bloomberg) -- David Einhorn has the upper hand in his disagreement with Morningstar Inc.’s domestic equity-fund manager of the decade over St. Joe Co., based on the Florida landowner’s stock performance.
St. Joe rose yesterday for just the third time since April 28, a period in which the shares tumbled as much as 30 percent. Yesterday’s 2.3 percent gain followed 10 consecutive losses.

Last month, the stock fell for 15 trading days in a row.

The Fairholme Fund is managed by the award-winning investor, Bruce Berkowitz. He controls a 29 percent stake in St. Joe through Fairholme Capital Management LLC and has served as the company’s chairman since March.

Einhorn, a co-founder of the Greenlight Capital Inc. hedge fund and prospective buyer of a stake in Major League Baseball’s New York Mets, disclosed that he was betting against St. Joe in October. The stock was 23 percent lower at yesterday’s close.

“St. Joe has huge possibilities,” Berkowitz said last week during an interview with Bloomberg Television. “We can just wait for the property market to turn.” Fairholme Fund had 3.1 percent of its assets invested in
St. Joe as of Feb. 28, according to data compiled by Bloomberg.

The holding accounts for most of Fairholme Capital’s investment in the company, based in Watersound, Florida. The stock’s losses contributed to an 11 percent decline in Fairholme’s share price this year. The fund ranks in the bottom 2 percent of its peer group, according to Morningstar. American International Group Inc. is its biggest holding, and shares of the bailed-out insurer fell as much as 44 percent for the year.