Mississippi John Hurt
Posted by Eddy Elfenbein on April 25th, 2008 at 5:14 pm

SPSS Inc. (SPSS)
Posted by Eddy Elfenbein on April 25th, 2008 at 1:29 pm

My latest at RealMoney.com (paid link) on SPSS Inc. (SPSS).

Arby’s Buying Wendy’s
Posted by Eddy Elfenbein on April 25th, 2008 at 10:51 am

From USA Today:

The owner of Arby’s said Thursday that it is buying Wendy’s International in an all-stock deal worth $2.34 billion after the burger chain’s board rejected at least two earlier offers by the company.
Triarc Companies (TRY), which is owned by billionaire investor Nelson Peltz, will pay about $26.78 a share for the company, which has about 87 million shares outstanding. The price is a premium of 6% from the company’s closing price of $25.32 Wednesday.
Under terms of the deal, shareholders at Wendy’s, the nation’s No. 3 hamburger chain, will receive 4.25 shares of Triarc Class A stock for each share of Wendy’s (WEN) stock they own.
Pam Thomas Farber, 53, daughter of Wendy’s founder Dave Thomas, said the family is devastated by the news.
“It’s a very sad day for Wendy’s, and our family. We just didn’t think this would be the outcome,” she said.

CNBC Anchor Factoid of the Day
Posted by Eddy Elfenbein on April 25th, 2008 at 10:32 am

I never realized that Trish Regan was Miss New Hampshire. She won the talent night at Miss America. Wow, well done Trish!

Is This a Real Car?
Posted by Eddy Elfenbein on April 24th, 2008 at 11:53 am

Or a large Matchbox? I’m not really sure.

Triple-A Failure
Posted by Eddy Elfenbein on April 24th, 2008 at 11:07 am

I’m currently working my way through Roger Lowenstein’s 5,000-word Triple-A Failure in a preview of the Sunday New York Times. I highly recommend it. Here’s the opening:

In 1996, Thomas Friedman, the New York Times columnist, remarked on “The NewsHour With Jim Lehrer” that there were two superpowers in the world — the United States and Moody’s bond-rating service — and it was sometimes unclear which was more powerful. Moody’s was then a private company that rated corporate bonds, but it was, already, spreading its wings into the exotic business of rating securities backed by pools of residential mortgages.
Obscure and dry-seeming as it was, this business offered a certain magic. The magic consisted of turning risky mortgages into investments that would be suitable for investors who would know nothing about the underlying loans. To get why this is impressive, you have to think about all that determines whether a mortgage is safe. Who owns the property? What is his or her income? Bundle hundreds of mortgages into a single security and the questions multiply; no investor could begin to answer them. But suppose the security had a rating. If it were rated triple-A by a firm like Moody’s, then the investor could forget about the underlying mortgages. He wouldn’t need to know what properties were in the pool, only that the pool was triple-A — it was just as safe, in theory, as other triple-A securities.
Over the last decade, Moody’s and its two principal competitors, Standard & Poor’s and Fitch, played this game to perfection — putting what amounted to gold seals on mortgage securities that investors swept up with increasing élan. For the rating agencies, this business was extremely lucrative. Their profits surged, Moody’s in particular: it went public, saw its stock increase sixfold and its earnings grow by 900 percent.
By providing the mortgage industry with an entree to Wall Street, the agencies also transformed what had been among the sleepiest corners of finance. No longer did mortgage banks have to wait 10 or 20 or 30 years to get their money back from homeowners. Now they sold their loans into securitized pools and — their capital thus replenished — wrote new loans at a much quicker pace.
Mortgage volume surged; in 2006, it topped $2.5 trillion. Also, many more mortgages were issued to risky subprime borrowers. Almost all of those subprime loans ended up in securitized pools; indeed, the reason banks were willing to issue so many risky loans is that they could fob them off on Wall Street.

Economic Perception Datapoint of the Day
Posted by Eddy Elfenbein on April 23rd, 2008 at 9:35 am

From yesterday’s PA exit poll:

Is National Economy in a Recession?
Yes: 88%
No: 11%
National Economic Conditions:
Slowing Down: 11%
Moderate Recession: 47%
Serious Recession: 42%

Remarkably, every group listed above voted for Hillary by a 54-46 margin. In other words, your perception of how well the economy is doing had zero relevance on how you voted.
But I am amazed that 42% of Keystone Staters think we’re in a serious recession. We certainly could be heading towards one, but it’s way too early to make that call. The unemployment rate is barely above 5%. To add some perspective, the unemployment rate for March is lower than every single month (save one) from 1975 to 1996.
Irrational pessimism anyone?

Harris Teeter Finally Opens in Adams Morgan
Posted by Eddy Elfenbein on April 23rd, 2008 at 8:20 am

We in Adams Morgan have been promised a Harris Teeter since, oh, about the Taft Administration. After countless delays, Washington’s first Harris Teeter opened this morning. I captured the details.
Here’s the ribbon ceremony:

OMG, it blows away anything else we have in the neighborhood, especially the gawdawful Safeway. Here the fruits and vegetables get my approval:

Look, a real salad bar! Check out the chrome. I bet they had salad bars like this on Star Trek:

Here’s the Jewel in the Crown. The vino section. It’s two freakin aisles!

Lincare & UnitedHealth
Posted by Eddy Elfenbein on April 22nd, 2008 at 2:55 pm

Lincare (LNCR) has been one of our worst Buy List stocks this year, but Q1 earnings were pretty good. The company earned 79 cents a share compared with 59 cents last year. Wall Street was expecting just 71 cents. On the downside, Lincare said that it now expects a $100 million impact from Medicare price reductions. Earlier, the company expected an impact of $65 million to $70 million.
The bad news today came from UnitedHealth (UNH). The company had been pretty consistent in saying it would earn $3.95 to $4 a share for this year. Well, not anymore. For the first quarter, UNH earned 78 cents, which was two cents below Street estimates. But the company lowered its full-year guidance to $3.55 to $3.60 per share. Ouch, that’s a major downgraded. The shares are getting rightly punished today.

Financial Analysts Offer To Talk About Recession For $5
Posted by Eddy Elfenbein on April 22nd, 2008 at 12:09 pm

From The Onion:

NEW YORK—With the nation almost certainly headed toward a recession, a coalition of top financial analysts announced Monday that they would be willing to discuss the economic future of the U.S. at any time for a negotiable fee of $5. “There are many complicated factors that will dictate the direction the economy will take in the coming months,” said commodity trading adviser Lucas Brockton, who repeatedly urged reporters at the press conference to leave any empty soda cans with him before they left. “We are more than happy to talk about these factors at length just as soon as we can get a wink from Mr. Lincoln, if you catch my drift.” As of press time, the analysts were considering an offer of $3.50 and half a turkey sandwich.