Americas

Is HP facing a Xerox or Kodak-like future?

27 Sep 2012

All three iconic companies used to be leaders in their respective industries and technologies. Today, Xerox is muddling along and Kodak is bust. The smart money is split on whether HP can return to glory. But tech history suggests the bears will print the winning ticket.

Warner Music echoes some off-key EMI chords

27 Sep 2012

With the Beatles’ parent officially swallowed up by Universal, Warner is left as a tiny number three. Like the old EMI, it is reliant on older acts, heavily indebted and led by an industry outsider. Owner Len Blavatnik has deep pockets, but the formula still doesn’t sound right.

Buyout firms risk conflicts in cosying up to SWFs

27 Sep 2012

CVC and Providence are the latest private equity houses to sell slivers of themselves to big sovereign and pension funds. A part-sale brings capital to expand, or to plough back into the group’s own funds. But it could alienate other stakeholders.

Few newly printed Fed dollars make it to consumers

27 Sep 2012

Ben Bernanke has called quantitative easing a Main Street policy. But American homeowners have only seen a sliver of the $2.3 trln of cheap money the Fed has created so far. If the central bank is really trying to juice consumption, more QE doesn’t look like the way to do it.

Americans can’t feel better than companies forever

27 Sep 2012

U.S. consumers are cheerier about life. But the corporate world is gloomier. If consumption jumps, it could soothe the business world’s blues. But the weak global economy and dysfunction in Washington are stunting hiring and could drag people down along with executives.

More leeway won’t help SEC without better cases

26 Sep 2012

The watchdog is asking the U.S. Supreme Court for more time to sue investor Marc Gabelli for wrongdoing a decade ago. Granting the request could make finding fraud easier. But effective enforcement requires making solid cases against perpetrators. The SEC too often falls short.

Arctic oil setbacks may be darkness before dawn

26 Sep 2012

Warnings from Total’s CEO about the safety of drilling in the region might sound like sour grapes. But environmental issues forced Shell to delay plans and deterred peers. Technological progress and $110 crude, though, won’t keep Big Oil from tapping the Arctic’s riches for long.

$4 bln Santander IPO puts Mexico bulls to the test

26 Sep 2012

That’s a handy sum for the Spanish bank’s coffers. And at 2.2 times book value it might look reasonable for a Mexican retail finance business churning out 20 pct returns. But fervent competition, newbie borrowers and rising default rates could soon put that under pressure.

Ethical economy: Who suffers in the U.S. economy?

26 Sep 2012

Some think the American middle class is imperilled because median income has fallen by 9 percent from the peak. But that decline is a statistical artefact. Others worry about increasing inequality in favour of the rich. The inequality against the poor is a more serious problem.

World without dollar primacy a blast from the past

26 Sep 2012

Goldman boss Lloyd Blankfein reckons the dollar’s reserve status may be at risk. Having no dominant currency would hark back to the 18th century, when silver pieces of eight competed with many other coins. Specialist currencies might emerge, but trading costs could rise.

Nixing China’s oil bid may create Canada discount

26 Sep 2012

The market reckons there’s a one-in-four chance politicians will scupper CNOOC’s offer for Nexen. Takeovers by state-owned companies raise tricky questions. But hoisting the Canadian flag over a company of little strategic importance risks further alienating outside investors.

BBA ouster is right first step for Libor reform

25 Sep 2012

The British Bankers’ Association is resigned to losing its role setting and overseeing the critical interest rate benchmark. After this summer’s rate-fixing scandal, that’s no surprise. Still, it’s an encouraging sign that Libor reform will be meaningful rather than piecemeal.

Batista’s dubious shine lures gold-hungry Qatar

25 Sep 2012

The Brazilian billionaire keeps trying to sell chunks of his diminishing empire, this time mesmerizing the Gulf state with his AUX mining unit. Qatar is hungry for commodities but the emirate should drive a hard bargain - or risk learning the hard way that not all bling is gold.

Law schools owe students truth about job market

25 Sep 2012

Goosing graduates’ employment statistics isn’t illegal, several courts have ruled. But it’s shameful nonetheless. With work scarce and tuition soaring, lawyer wannabes deserve honesty from institutions that teach legal ethics. Caveat emptor makes for a lousy school motto.

Who will run Murdoch’s grand newspaper spinoff?

25 Sep 2012

With a key UK regulatory judgment on BSkyB out of the way, News Corp can focus on cleaving its newspaper empire. Critically for investors, that means picking a CEO. Wall Street Journal boss Robert Thomson appears in pole position. His appointment would spark a chain reaction.

Shale gas-led U.S. boom is lesson for wary Europe

25 Sep 2012

In five years, the price of natural gas has halved in the U.S. and doubled in the UK. One result is an industrial renaissance in America. Europe could do with the economic and political benefits of plentiful gas, too. EU governments, reluctant to allow fracking, need to rethink.

Don’t expect the impossible from OMT and QE3

25 Sep 2012

Central banks have shown their firepower, cheering markets. But ECB bond buying can’t solve the euro crisis. And while QE3 may nudge the U.S. economy, it’s risky to reflate through housing. If central banks try too hard to do everything, they’ll end up spurring global inflation.

iPhone 5 will live up to the hype – in time

24 Sep 2012

The 5 mln handset sales, worth some $3 bln, on debut fell well short of Wall Street’s whisper number. The figure still outpaced its predecessor’s and the iPhone 5 couldn’t meet demand. Supply-chain glitches and map-app hysteria won’t derail Apple’s chugging smartphone train.

Americans’ improved finances could help Obama

24 Sep 2012

Mitt Romney likes to ask if people feel better than four years ago. Unemployment remains a problem. But consumers have reduced debt, and a new survey suggests they feel their personal finances are in better shape. They may be happier about Obama’s tenure than Romney thinks.

Foxconn brawl reflects China’s economic challenges

24 Sep 2012

Reports of violence from one of the Apple supplier’s factories conjure up Western prison riots. That’s unfair, but 79,000 migrant workers, excess hours and dependence on a tough employer make a recipe for tension. It’s the dark side of supplying shiny gadgets to the world.