Americas

Corzine apology little better than Fuld’s defiance

8 Dec 2011

The ex-CEO of defunct MF Global told Congress he regrets the loss of money and jobs. But his prepared statement is also full of dubious excuses that are hardly better than Dick Fuld’s blame-game tactics. Wall Street bosses still haven’t learned to take responsibility.

Latin America gets closer even as Europe cracks

8 Dec 2011

Cross-border deals among South American companies, like Chilean CorpBanca’s purchase of Santander Colombia, set a new record in 2011. A single Latin currency seems remote given the euro’s woes. But as the region’s private sector consolidates, it can’t be ruled out for ever.

Fed needs better PR on last-resort lending, too

7 Dec 2011

The U.S. central bank is working on its monetary policy communications. But its key role as a crisis lender is also in the spotlight over a $7.8 trln number that has been mischaracterized by some news outlets. The Fed would get less flak if it managed this message better as well.

Better to extend, not expand, U.S. payroll tax cut

7 Dec 2011

Democrats want to cut further the rate of Social Security tax paid by employees. That might not achieve much, as this year’s tax reduction hasn’t obviously boosted the economy. Even so, letting the rate go back up could have a negative effect. It’s safest to stand pat.

Ethical Economy: Eat more, pay more

7 Dec 2011

The United States leads the world in both obesity and health care spending. The two are tied together by a wilful attitude to health. The combination of “I want what I want” with “society pays” is unjust and expensive. It’s time to consider some medical de-socialisation.

Don’t boo U.S. football’s zero-coupon perpetuals

7 Dec 2011

The Green Bay Packers are selling shares that pay no dividend and can’t be sold. What sounds like a sucker’s bet - or a donation - at least gives fans a tangible stake in the local champs. And as it happens, since the team’s last sale, plenty of “real” stocks are down.

Pleading the Fifth smart but risky for Corzine

6 Dec 2011

The U.S. Congress has ordered the former CEO of defunct MF Global to testify Thursday. For a famously garrulous ex-politician, invoking the right to clam up might seem to imply guilt. But with criminal investigators sniffing around, there’s no upside to giving them fodder.

Michael Kors IPO cut from same cloth as Prada’s

6 Dec 2011

The U.S. designer’s eponymous firm is seeking a luxury price tag of up to $3.6 bln in a New York float. It’s an all-American fashion name and the high-end valuation isn’t out of line with Prada’s Hong Kong listing this year. But Kors may struggle to keep up the pace of growth.

Pharma center of gravity shifts eastward

6 Dec 2011

Drug research tends to follow spending. Take Merck’s pledge to invest $1.5 bln in R&D in China. Emerging economies’ citizens are growing wealthier and living longer, while their governments’ fiscal health is robust. Merck’s step suggests drug development is shifting accordingly.

Peru surprisingly firm on keeping capital flowing

6 Dec 2011

The country needs foreign money to enrich its people. Investors worried in June when President Humala was elected, then raised taxes on miners. But now he’s shown that legitimate mines will be protected from agitators, further suggesting he may not be as leftist as many feared.

Oracle needs to read Cisco cautionary tale

5 Dec 2011

Empires built on acquisitions can run into problems as they sprawl. That’s doubly so in tech, where obsolescence is a risk. Oracle has used database profits to buy new businesses. So far, so good - but Cisco’s record suggests success will be hard to sustain.

Courts more willing to second-guess Wall Street

5 Dec 2011

U.S. judges have typically trodden softly over financial disputes and settlements for fear of ruffling markets. But the rejection of the SEC-Citi CDO deal is the latest sign times are changing. Activist courts aren’t good for certainty, but they’re filling a gap left by Congress.

SAP pays $3.4bln to ride rise of "cloud" computing

5 Dec 2011

The German software giant is swallowing a fast-growing yet barely profitable upstart, Successfactors. The price is a lofty 8 times sales but SAP needed a deal. It risked missing out on a huge shift by corporate clients to cloud-based technology applications.

New England power merger deserves final nixing

5 Dec 2011

A report on Northeast Utilities’ handling of a snowstorm from a former U.S. disaster official makes it clear: the company failed in the duties that come with its monopoly. Regulators have all the evidence they need to power down the utility’s $4.7 bln takeover of rival NSTAR.

U.S. jobs picture brightens, but not for all

2 Dec 2011

Job creation is getting stronger. And the sharp drop in the unemployment rate to 8.6 pct will please Obama. But it conceals a bifurcation: those without jobs are either getting them or giving up. The danger is that worker shortages arise quickly and social problems proliferate.

Delay takes shine off Zynga’s IPO

2 Dec 2011

Revenue at the maker of FarmVille and other Internet games is still rising fast. But on more telling measures, growth has slowed. Zynga’s hoped-for $9 bln valuation isn’t too far-fetched. But the price tag might have been even higher had it harvested IPO investors’ cash earlier.

Prosecutors corrupt effective anti-corruption law

2 Dec 2011

A U.S. judge just overturned the first court win against a company under the Foreign Corrupt Practices Act, ruling the government fudged evidence. It’s an extreme case of prosecutors stretching to nail firms for bribery. But it further threatens a useful law already under attack.

Thomson finally completes takeover of Reuters

2 Dec 2011

Tom Glocer’s bankerly CEO skills no longer suit the publishing giant. He restructured Reuters and deftly engineered its well-timed sale. But the company needs to grow – and the controlling Thomson family is weary of waiting. How it does so, though, still seems far from clear.

How GM’s Akerson can show off some Mulally mojo

1 Dec 2011

Bankruptcy gifted GM a better balance sheet and CEO Dan Akerson is revving up sales. But he still needs to fix Opel, further overhaul operations and truly bury the stodgy old GM before he can convince investors he’s capable of the turnaround Ford’s Alan Mulally has achieved.

Big U.S. foreclosure settlement isn’t dead yet

1 Dec 2011

It sounds like the start of a Monty Python riff but also suits the Massachusetts lawsuit against major banks. Though it might seem to end a unified front by the states, it hasn’t really torpedoed their joint efforts. In fact, the suit could breathe new life into negotiations.