Netflix places $5 bln bet on exclusivity 1 Sep 2015 The online video company is ditching content provider Epix. That’s bad news for armchair watchers of big movies like “Hunger Games.” Instead, Netflix is upping its spending on shows no one else has. As Apple, Amazon and others join the streaming wars, it’s a smart move.
Silicon Valley rule of thumb points right way 31 Aug 2015 In a land that fetishizes revenue growth over profitability, there’s a new sanity check for software firms to see if the two rates add up to at least 40 pct. A Breakingviews analysis suggests it can be a useful guideline. Investors should just be wary of extrapolating too much.
Fed dilemma is mostly good news 31 Aug 2015 Vice Chair Stanley Fischer reckons inflation is only temporarily subdued. Along with the BoE’s Mark Carney, he also downplayed China’s deceleration. The Fed’s doves, meanwhile, remain wary of raising interest rates. The split is evidence the U.S. economy is finally mending.
BNY Mellon fund-pricing glitch exposes dangers 31 Aug 2015 The U.S. bank’s SunGard-provided system for valuing mutual fund assets is working again a week after going down. This time, damage was minimal. But the episode reveals potential risks from bugs in software to over-reliance on third-party vendors and scrimping on costs.
China capital flight inspires enlightened scam 31 Aug 2015 U.S. investigators say a former Buddhist monk conned $125 mln from 250 investors seeking U.S. visas. China’s sputtering economy has fueled a booming market for immigration by investment. It won’t be the last time the country’s worried wealthy are relieved of their worldly goods.
White House hopefuls all agree: China is the worst 28 Aug 2015 Move over Wall Street. U.S. presidential candidates have a new bipartisan punching bag. From Tea Party favorite Donald Trump to socialist sweetheart Bernie Sanders, the entire field has reasons - ranging from crushing stocks to hacking to trade - for dissing Asia’s superpower.
Freeport-McMoRan leaves Carl Icahn lots of targets 28 Aug 2015 Big cuts in spending and staff sent the struggling miner’s stock soaring – just before the activist revealed an 8.5 pct stake. The pre-emptive strike won’t be enough to satisfy the feisty billionaire. High debt and low commodity prices suggest he has asset sales in his crosshairs.
Review: Ben Bernanke and a global monetary plague 28 Aug 2015 Ever since the collapse of Lehman Brothers, the Federal Reserve has engaged in financial experimentation that has delivered the weakest rebound on record while spreading deleterious effects around the globe that author Brendan Brown, in a forthcoming book, likens to a plague.
Google EU antitrust spat riddled with holes 28 Aug 2015 The search giant’s robust response to a European challenge over price comparison tools ratchets up a complex theoretical battle over what makes a monopoly. Yet the dispute misses a broader point: it’s hard to see how any likely outcome will make a massive difference to consumers.
Rob Cox: Double-duty CEOs are a worrisome trend 27 Aug 2015 Fiat boss Sergio Marchionne may don another hat to run Ferrari. Like Jack Dorsey and Elon Musk, however, he’s only human. Investors in public companies, especially young or challenged ones, require full attention from a leader. That’s all but impossible when he’s running two.
Dole boss is bad apple for buyout barrel 27 Aug 2015 A judge says David Murdock duped shareholders, independent directors, lawyers and bankers when he took the produce vendor private two years ago for $1.6 bln. The deceit will cost him $150 mln. It’s also a sad reminder that even carefully vetted deals can be rotten at the core.
Coke’s sparkling H2O talk is a bit too fizzy 27 Aug 2015 The soft-drinks giant has done more than many corporations to nurture water resources. Now CEO Muhtar Kent reckons he can hit Coke’s goal of replenishing every liter it uses five years early. But the company’s claim that it will be water neutral doesn’t yet pass the taste test.
Solid U.S. growth trumps stock market sideshow 27 Aug 2015 GDP expanded at a 3.7 pct pace in the second quarter and 2.7 pct year-on-year. The jobs market looks steady. For central bankers like the Fed’s Bill Dudley, that ought to be more “compelling” than the now-arrested slide in shares. Zero interest rates are past their sell-by date.
Fake Goldman Sachs belies a real China strength 27 Aug 2015 The U.S. investment bank joins a long list of counterfeits that includes Apple stores, police stations and British villages. They’re easy to mock, but also veil a broader readiness to bend rules in search of profit. Properly channelled, that ingenuity and pluck could be powerful.
Schlumberger’s daring deal looks carefully hedged 26 Aug 2015 The oilfield services provider is moving outside its comfort zone to buy drilling gear maker Cameron for $15 bln even as the price of crude falls. The 56 pct premium is flattered by the market selloff and covered by cost savings. Schlumberger may have threaded the M&A needle.
Monsanto leaves Syngenta facing awkward questions 26 Aug 2015 The world’s largest seed maker has given up pursuit of its Swiss rival. The $46 bln deal required aggressive assumptions and carried risks. Syngenta’s management now needs to prove its reluctance to talk was worth it.
Monsanto $46 bln Syngenta offer deserves a hearing 26 Aug 2015 The U.S. seed giant’s last cash and shares approach to its Swiss rival was rebuffed. Monsanto has offered a little more, but can’t go much higher without destroying value or relying on rosy assumptions. The pressure is on Syngenta to talk, or show investors it has a better plan.
Yellen may relish opportunity not to communicate 25 Aug 2015 The Fed chair is skipping central bankers’ annual shindig in Jackson Hole this week. For all her institution’s professions of transparency, recent global market ructions mean nothing she might have said would have satisfied anyone. Better to wait until the FOMC meets next month.
Exelon mercifully spared winner’s curse 25 Aug 2015 Local D.C. authorities nixed the power company’s $6.8 bln takeover of rival Pepco. A bidding war against earlier failed Exelon target, PSEG, led to a price that was hard to justify. Such intervention may be a concern, but in this case one set of shareholders gets a helping hand.
Tech’s real China syndrome victims are yet to fall 24 Aug 2015 Facebook, Apple, Amazon and Microsoft lost nearly $200 bln of value in a week. China’s woes sparked the rout, but the problem was investors’ giddy faith in growth. Public tech stocks may recover. Fantasy valuations of private firms like Uber, though, will take the bigger hit.