Hadas: Fear not, you can get economics right 12 Jul 2017 The dismal science struggles to explain such basic issues as persistent disinflation, lingering post-crisis trauma and rising inequality. Unsuitable methodology is the primary culprit. A new “Blackfriars School" can help by asking better questions about what’s really going on.
Exchange Podcast: Jesse Eisinger 11 Jul 2017 Why didn't any Wall Street bigwigs go to jail over the 2008 financial crisis? ProPublica reporter Jesse Eisinger argues that's because prosecutors joined "The Chickenshit Club," which is also the title of his new book.
Elliott tests one of Warren Buffett’s golden rules 11 Jul 2017 Paul Singer's hedge fund has cobbled a rival bankruptcy-exit plan for Energy Future, challenging Berkshire Hathaway's $9 bln deal. The new offer may be a stretch, but Buffett famously eschews competitive processes. He also needs approval from creditors, one of which is Elliott.
Holding: Judges owe investors principle, too 11 Jul 2017 The U.S. Supreme Court has been paying greater interest to securities-related cases. One against tech firm Cyan is the latest. Yet narrow and unpredictable rulings have confused shareholders about everything from insider trading to filing deadlines. Clearer standards are overdue.
Amazon’s path of destruction is primed to broaden 11 Jul 2017 The e-commerce giant that decimated booksellers now has supermarkets and department stores quaking in fear. That emotion should be shared by retailers’ suppliers of branded goods. Amazon’s ambitions to sell its own products poses a growing threat to the likes of P&G and 3M.
Snap makes IPO price its latest vanishing trick 11 Jul 2017 The disappearing-message app trades 6 pct below its March debut. Morgan Stanley downgrading the company it took public didn’t help. But awful corporate governance, doubts about its ability to grow and competition from Instagram all put Snap under longer-term pressure.
Volcker Rule emblematic of new Fed pick’s challenge 11 Jul 2017 Randal Quarles is set to be the central bank’s first head of supervision, a key role in Trump’s deregulatory push. But even where political consensus exists, like revising parts of the prop-trading ban, change requires support from fellow watchdogs. That’ll slow the process.
UK’s jobs review kinder to employers than workers 11 Jul 2017 A government-backed study proposing better rights for gig workers and changes to tax hits some helpful notes. It stops short, though, of calling for business to bear the cost of a highly flexible workforce. That is a realistic reflection of the UK’s weaker bargaining power.
Pearson’s $1 bln Penguin sale papers over cracks 11 Jul 2017 The education group is selling almost half its 47 pct stake in Penguin Random House to co-owner Bertelsmann. Pearson has maximised the cash proceeds, but the valuation looks low. With a still-troubled core business, boss John Fallon is running out of assets to sell.
Yoga-studio IPO stretches investor chakras 10 Jul 2017 A California chain wants to raise $75 mln for centers teaching cobra and other poses. Despite the popularity of the discipline and fitness broadly, YogaWorks' model is easy to copy. After the pain of trendy Blue Apron and Snap, resistance now offers a better path to inner peace.
Companies will have their day in Trump’s courts 10 Jul 2017 The White House travel ban and environmental rollbacks got blocked in court, but there are over 100 judicial vacancies for the famously litigious president to fill. Aging jurists could leave even more open seats. That may reshape upcoming battles in finance, tech and beyond.
Rare sense prevails in reworked U.S. utility deal 10 Jul 2017 Great Plains tried to buy next-door power provider Westar, but regulators nixed the plan. In a new roughly equal $14 bln merger, the target gets a lower headline price and the buyer less control. It's an unusually pragmatic compromise considering how often egos undermine M&A.
Newspapers push wrong solution to online duopoly 10 Jul 2017 The Wall Street Journal and others want the right to bargain collectively with Facebook and Google. The titans’ dominance of the $83 bln U.S. digital ad market is a concern, but not just for print media. Combating it requires antitrust enforcement, not an industry carve-out.
Blackstone’s diversification drive circles home 7 Jul 2017 Steve Schwarzman’s $370 bln buyout shop has vastly expanded into real estate, hedge funds and credit. It's now using capital that had been focused on hedge funds to take a stake in fellow private-equity firm Leonard Green. The return comparisons are too stark to ignore.
Campbell Soup deal is mmm mmm meh 7 Jul 2017 The canned-cream-of-mushroom-to-Goldfish-crackers maker is buying organic-focused Pacific Foods for $700 mln. Like other big grocery brands, Campbell finds itself squeezed by such rivals. At more than three times sales, it's a steep price to pay to try and get healthier.
AT&T boss becomes top story in CNN showdown 7 Jul 2017 Randall Stephenson's $85 bln deal to buy Time Warner is now embroiled in Trump's feud with the news network. Unless CNN President Jeff Zucker goes, the administration may not sign off, a media outlet reported. That suggests an abuse of power that demands stiff resolve from AT&T.
Healthy U.S. payrolls hide pain of working-age men 7 Jul 2017 Employers added a robust 222,000 positions in June while the jobless rate stayed low, at 4.4 pct. At the same time, opioid usage and extensive incarceration have kept many males in their prime years out of the workforce. Wiser policy decisions could help bring them back.
Buffett may have to turn on charm for Oncor encore 7 Jul 2017 Berkshire Hathaway is taking a second stab at Texas utility Energy Future, six years after a $2 bln investment led to big losses. Two other suitors failed to agree with regulators. Buffett's structure sounds smarter, but sealing the $18 bln deal could yet require some sweet talk.
SoundCloud flags music’s lopsided digital revival 7 Jul 2017 The German streaming service is cutting 40 percent of staff, according to reports, after Spotify shelved a possible purchase last year. With most of the returns from the industry’s digital renaissance going to labels, streamers have yet to prove they have an independent future.
Konica Minolta deal helps develop clearer picture 6 Jul 2017 The Japanese company that abandoned cameras for copiers a decade ago is now putting its focus squarely on medical diagnostics. An up-to-$1 bln acquisition of Ambry Genetics alone won't assure Konica Minolta's future. It is, however, an affordable way to start changing its DNA.