Americas

Money printing is actually a great idea

11 Feb 2013

Adair Turner, the UK FSA boss, broke a taboo by suggesting that governments should sometimes just print money to cover deficits. The regulator didn’t go far enough. Governments can create and destroy money at will. They shouldn’t be afraid to do so to melt away leverage.

Slowing U.S. snail mail could speed innovation

8 Feb 2013

Halting Saturday deliveries won’t much stem the postal service’s $5 bln of annual losses or plug its pension hole. But it’s an opportunity to hasten corporate and individual technology adoption. Over time, further shrinking the USPS should have broader economic benefits.

Canada-U.S. oil pipe beats shipping options

8 Feb 2013

Washington is stalling on the Keystone pipeline, so Canada is exploring alternatives for its oil-sands crude. But exporting it on tankers would be more polluting and riskier. American NIMBY opposition to Keystone is bad for the planet as well as for the nation’s energy supplies.

Review: A spy’s eye in the workplace

8 Feb 2013

Former CIA undercover officer J.C. Carleson has a terrific book in her, though “Work Like a Spy” is only intermittently it. Offering business tips based on her espionage skills, she waters down clandestine techniques till some seem merely bland. Others, though, fizz with insight.

Apple and Einhorn could both use cleaner design

7 Feb 2013

The iPhone maker has combined three governance fixes better considered separately by shareholders. Also a bit unwieldy is an idea to unlock the value of the company’s cash that has led the hedge fund boss to try to block the changes. Both would gain from Apple’s famed simplicity.

Law of haste makes waste should govern M&A suits

7 Feb 2013

Delaware judges often warn attorneys to do their homework before suing. Now one group of legal eagles is being grounded for doing just that. This undermines efforts to curb deal litigation. Courts are right to want to punish a rush to the courthouse. But they must be consistent.

Lazard keeps antsy activists at bay

7 Feb 2013

The Wall Street firm’s Q4 suggests it is making progress with its promise to boost margins. It also returned cash to investors a year earlier than planned. And business is looking robust under CEO Ken Jacobs. The likes of Nelson Peltz have little, if anything, to complain about.

New York Times shows no signs of ad renaissance

7 Feb 2013

Investors cheered the newspaper group’s 16 pct increase in Q4 circulation sales, sending shares up 12 pct. But that looks too generous. Subscriptions will eventually flatten out, and the Gray Lady under its new, ex-BBC CEO is still failing to halt the decline in ad sales.

Drip-drip Libor shame beats an industry settlement

7 Feb 2013

RBS traders stupidly bragged of “Libor fixing” over email. Each bank’s settlement heaps new humiliation on the sector. UBS chair Axel Weber wants an industry settlement to help banks move on. But prolonging the pain by singling firms out helps society hold banks to account.

The unsexiest media company alive: Time Warner

6 Feb 2013

The owner of HBO and People has kept up with media rivals without the recent wheeling and dealing at Disney or News Corp. In five years under CEO Jeff Bewkes, Time Warner has handed investors a 70 pct return. Despite a solid Q4, the question is whether boring can stay beautiful.

Captain Austerity gets his toe tagged

6 Feb 2013

Time of death: Feb. 6, 2013. The new Republican strategy shies away from fiscal tightening after controversial initiatives to slash deficits flopped. President Obama is seeking ways to scale back sharp cuts in defense and other spending. U.S. austerity is gone - and far too soon.

Elan’s $3.25 bln deal reduces risk – and raises it

6 Feb 2013

The biotech is selling part of its 50 pct stake in its blockbuster drug, and main asset, Tysabri, to partner Biogen. That should maximize Elan’s profit: this reduces the incentive Biogen has to sell competing drugs. The danger is the cash burns a hole in the company’s pocket.

Chesapeake may have shot itself in foot on CEO pay

6 Feb 2013

Departing boss Aubrey McClendon is getting a $47 mln golden handshake. But the under-fire executive is retiring. That should allow the gas driller to claw back up to $30 mln rather than lavishing more largesse on McClendon. That gives investors a good case to sue.

Liberty pushes envelope for post-crisis M&A debt

6 Feb 2013

The U.S. media group is funding the cash element of its $23 bln Virgin offer by gearing up its target. Almost $8 bln of new debt will be issued with the deal. Overall leverage may still be below pre-crisis multiples. But it’s a big moment - and could beget more levered M&A.

RBS moves away from Libor danger zone

6 Feb 2013

The UK bank has avoided a franchise-destroying U.S criminal liability. The 390 mln stg fine - more than Barclays, much less than UBS - should be bearable. But the UK government still has many other problems to deal with before it can sell its 81 pct stake.

The answers to extract from Mark Carney

6 Feb 2013

The next Bank of England governor sits before UK lawmakers this week. Central bankers are masters of ambiguity. But Carney should be made to say how he would have managed Britain’s financial and economic crisis differently, and what he can realistically achieve from here.

Hack attacks may be West’s cue to try harder

6 Feb 2013

China’s alleged attacks on U.S. companies are a new twist on an old theme: outsiders wanting in. China sees itself as the ultimate underdog, so the urge to snoop should fall as it matures. Meanwhile, fears of hacking may spur useful new initiatives in potential targets.

Murdoch and Malone make better allies than rivals

5 Feb 2013

The media moguls are squaring off again. John Malone’s Liberty Global wants to buy Britain’s Virgin Media - a rival to the Rupert Murdoch-backed BSkyB. But the two UK companies complement each other. Collaboration would work in their favour, leaving third player BT as the loser.

Ally so close to paying back Uncle Sam, yet so far

5 Feb 2013

CEO Mike Carpenter threatened to pick up his ball and go home in a spat with creditors of ResCap, its bankrupt mortgage unit. But Ally is better off playing nice. The auto lender may be profitable again, but investors won’t go near Ally until its mortgage exposure is resolved.

Warning: it’s not just the hacks being hacked

5 Feb 2013

The New York Times and other media outlets may think network intrusions from China are payback for probing the Beijing regime. But PRC news paranoia is only a small part of a big story. Other Western companies should read between the lines, and beef up inadequate cyber-defenses.