U.S. defense becomes more defensive investment 1 Oct 2013 Pressures on the U.S. deficit are taking a toll on makers of fighter jets and missiles. The likes of Lockheed and Northrop once focused on growth, but are now handing back more cash to shareholders. The trouble is their profile for investors is somewhat at Uncle Sam’s whim.
Container Store fills IPO with Silicon Valley hype 1 Oct 2013 Selling boxes is a commoditized affair. That’s why the CEO hawks cult-like self-improvement instead. He talks of the company’s “yummy” employee-centered culture. But paying Container Store’s backers a dividend with the proceeds of going public shows a hard-headed capitalism.
Activision investors may lose even in victory 1 Oct 2013 The videogame maker’s minority owners convinced a judge to block an $8 bln plan to buy out Vivendi, derailing a sensible transaction in the process. Activision probably will have to pay more to clinch the deal. It’s a reminder that some fights for shareholder rights are costly.
Investors rightly shrug off Catalonia’s separatism 1 Oct 2013 Catalan independence has become a hot political topic in Madrid, yet investors are ignoring the region’s threat. They bet that reason will prevail over parochialism, considering the hurdles to full-blown independence. For now Spain’s fragile recovery is a more pressing concern.
U.S. does what it can to de-reserve the dollar 1 Oct 2013 A global currency hegemon intent on shedding its status might try fiscal panics and selfishly erratic monetary policy. The world is still far too reliant on the dollar to care much. But while international clout is never lost overnight, the U.S. is speeding up the end of its era.
Japan’s tax blow is well cushioned 1 Oct 2013 Prime Minister Shinzo Abe has unveiled a $51 billion stimulus to help offset next year’s increase in the sales tax. That should soften the impact on spending. But if consumers do catch a deflationary chill, the government can count on the Bank of Japan to crank up money printing.
Unilever’s emerging weakness is a strategic hazard 1 Oct 2013 The Anglo-Dutch consumer products outfit is suffering from slower growth in the developing world. Brazil and India are tricky and currency swings are hurting too. Unilever has to be wary of complacency. But its broad plan, to run hard at faster-growing markets, remains right.