“FBN is just plain dumb”
Posted by Eddy Elfenbein on March 12th, 2008 at 7:58 am

Liza Featherstone looks at Fox Business News:

At times, FBN is just plain dumb. Some of the Murdoch Playmates are genuine bimbos, while others play their dopey roles convincingly, and the choice of material they’re given isn’t pretty. One morning, Alexis Glick, the lusciously made-up anchor—also a Columbia graduate who has worked as an equity analyst for Goldman Sachs and directed New York Stock Exchange floor operations at Morgan Stanley, though you’d never guess it from her breathless on-air persona—dizzily conducts an inspiring interview with a woman who has broken the glass ceiling in the all-important industry of competitive beach volleyball. A few other critical, breaking stories on FBN, as the American economy careened into chaos and uncertainty, included a check-cashing fraud involving a corpse, and “the Meanest Mom on the Planet” (she sold her teenage son’s car after finding booze under the seat!). There’s no doubt that CNBC is more journalistically serious than Fox. Almost any random dial-flipping will provide the contrast, but here’s just one: While CNBC featured New York Times columnist David Leonhardt explaining substantive economic policy differences among the Republican candidates, Fox was reporting that despite her scandalous pregnancy, people are still watching Jamie Lynn Spears’s TV show.

According to Neilson, just 6,300 people watch FBN.

Jim Rogers: Abolish the Fed
Posted by Eddy Elfenbein on March 12th, 2008 at 7:48 am

Jim Rogers isn’t shy about his opinions:

Listen, investment banks have been going bankrupt since the beginning of time. If people make mistakes — if you bail out every investment bank that gets in trouble, that’s not capitalism, that’s socialism for the rich.

History Says the Rally Will Continue
Posted by Eddy Elfenbein on March 12th, 2008 at 7:38 am

Yesterday was the 33rd best day for the S&P 500 since 1950. Looking at the average of the top 32 days shows that the market has historically continued to rally a bit after the big surge. For the following nine days, the S&P 500 has averaged an additional gain of 1.78%.

Fire Sale at the Times?
Posted by Eddy Elfenbein on March 12th, 2008 at 7:18 am

The Wall Street Journal reports that the New York Times is considering selling some assets. Well…it’s about time. This move is clearly in response to pressure from hedge funds that are pushing for seats on the company’s board. The funds now own as much stock as the Sulzberger family.
In the media, pressure from hedge funds is often portrayed in a negative light, as if some slick-haired Gordon Gekko types are bullying a loveable family run enterprise. In the case of the New York Times, the funds are the only ones willing to hold the company accountable. The current management has run the company into the ground, and an asset sale should have happened a long time ago. Jack Welch, for example, wanted to buy the Boston Globe, but the Times shot him down. Now, I doubt the Times could sell the Globe even if they wanted to.
Here’s what sclerotic companies like the Times don’t get: Even if shareholders don’t control the board, they still have a vote. They can vote by selling and that’s exactly what has happened. Shares of NYT are basically where they were 12 years ago. How could anyone think that’s serving shareholders well?
There’s also an interesting wrinkle. One of the NYT’s non-core assets is a stake in the Boston Red Sox. You read that right. That’s like Sauron owning a stake in the Hobbit’s favorite pub. Given the Bosox recent World Series wins, I would think that the franchise could go for a nice sum. Speaking of Sauron, maybe Steinbrenner is interested?
The Times could also let go of the IHT and even About.com. Some analysts have floated ideas of the Times being bought out by fill-in-the-blank (Buffett, Google, Bloomberg). Interesting, but I doubt it. Even if a major deal came to pass, it doesn’t avoid the major issue that the Times can’t survive in its present form. It will exist, but I don’t think it will be a New York-focused general news publication. The future lies in smaller, niche pubs.

Best Day Ever
Posted by Eddy Elfenbein on March 12th, 2008 at 7:17 am

Yesterday was the best day for the stock market in five years, but this week, we’re celebrating the 75th anniversary of the best day ever.
Well, technically it wasn’t a one-day gain. When FDR became president on March 4, 1933, there was a national bank holiday. The stock exchange shut down at didn’t reopen until March 15. When trading resumed, stocks soared. The Dow closed at 62.1 which was a 15.34% gain over the close from 12 days before.
The Dow has never done better. By contrast, yesterday’s move doesn’t rank in the top 150. The rally of March 1933 was so strong that the Dow doubled by July.

In March 1933, the U.S. effectively ended the gold standard. It’s interesting that yesterday’s rally was sparked, in part, by the Fed’s securities-lending program.

Today’s S&P 500
Posted by Eddy Elfenbein on March 11th, 2008 at 9:26 pm

Here’s how every stock in the S&P 500 did today.

Things that Sound Like Chewbacca
Posted by Eddy Elfenbein on March 11th, 2008 at 4:57 pm

Vacuum Cleaner
Nightstand
Dog
Cat
Boxer
Baby
Dude Getting Tasered
Hatchback
Trash Can
Hippie Chick

The Best Day in Five Years
Posted by Eddy Elfenbein on March 11th, 2008 at 3:46 pm

Today was the best day for the S&P 500 in five years.
Date……………Gain
11-Mar-08…….3.71%
17-Mar-03…….3.54%
13-Mar-03…….3.45%
18-Sep-07…….2.92%
13-Nov-07…….2.91%
28-Nov-07…….2.86%
2-Apr-03……….2.61%
17-Aug-07…….2.46%
6-Aug-07………2.42%
21-Mar-03…….2.30%
16-Jun-03……..2.24%
1-Oct-03……….2.23%
The last time the S&P 500 was up this much was October 15, 2002.

UNH at Three-Year Low
Posted by Eddy Elfenbein on March 11th, 2008 at 11:29 am

UnitedHealth Group (UNH) is plunging today on news that WellPoint (WLP) has cut its earnings forecast. If you recall, UNH is company that does nothing but make huge profits and awful headlines.
For the record, UnitedHealth has said that it expects 2008 EPS of $3.95 to $4 a share. The company has publicly made this estimate not once, but twice. That would be a yearly increased of 13% to 14% over 2007. Not bad.
But now the stock is down to $40 a share. Today, it reached its lowest point since 2004. In 2005, the company made $2.48 a share. So the stock is the same price, but profits are about 60% higher.

In the above chart, the blue line is the stock price and it follows the left scale. The yellow is the EPS and it follows the right. The red part is the estimate. When the lines cross, the P/E ratio is 17.5.

The Fed Opens the Spigots
Posted by Eddy Elfenbein on March 11th, 2008 at 11:25 am

Let’s throw money at them until they stop complaining!

The Federal Reserve, struggling to contain a crisis of confidence in credit markets, plans to lend up to $200 billion in exchange for mortgage-backed securities.
The Fed coordinated the effort with central banks in Europe and Canada, which plan to inject up to $45 billion into their banking systems. The Fed said in a statement it will hold auctions of Treasuries in exchange for debt including AAA rated mortgage securities sold by Fannie Mae, Freddie Mac and by banks.
Today’s steps indicate the Fed is increasingly concerned about the investor exodus from mortgage debt, which threatens to deepen the housing contraction and the economic slowdown. While they fall short of the calls by some analysts for the Fed to make outright purchases of mortgage debt, the central bank left the door open to expanding the effort.
“This is the most significant step the Fed has taken so far,” said David Resler, chief economist at Nomura Securities International Inc. in New York. “This relieves some of the pressure” in the credit markets, he said.