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Alabama voters put anger before economics

13 Dec 2017

Democrat Doug Jones won the state’s U.S. Senate race in a stunning upset. Rival Roy Moore has unique troubles, namely allegations of sexual misconduct. But Trump’s approval has also fallen, despite Alabama’s low jobless rate. The Republican economic-growth message isn’t a magic elixir.

Trump’s anti-WTO rhetoric hurts America first

11 Dec 2017

U.S. trade chief Robert Lighthizer has a tough message for the body’s biennial confab. The White House is also blocking new WTO appellate judges. Reforms are needed but America has won most of its complaints, including against China. Weakening it has consequences for U.S. firms.

Bitcoin futures set scene for more gambling

11 Dec 2017

The 20 pct surge on new CBOE cash-settled contracts is sedate by crypto-currency standards. There’s still cause for concern. Rather than being a useful hedge, futures make it easier to trade bitcoin without actually owning it. For now they have little utility beyond speculation.

Hadas: Bitcoin at $10,000 is even more dangerous

29 Nov 2017

The crypto-currency is on the verge of turning respectable, but a futures market cannot cure its faults. It is economic nonsense, socially irresponsible and an incoherent vote for cultural nihilism. Then there is the unadulterated greed. Disaster can't come soon enough.

Uber’s year of efficiency backfires

29 Nov 2017

The ride-hailing app’s 2017 goal was to grow while minimizing subsidies and cash burn. Instead, quarterly losses accelerated to nearly $1.5 bln. Uber faces a slew of problems, but has yet to answer a basic existential question: can it develop a sustainable business model?

CFPB leadership row won’t stop inevitable gutting

27 Nov 2017

It’s unclear who’s in charge at the U.S. consumer protection agency. The departing Obama-appointed director named his interim successor, as did the White House, provoking a legal fight. But Trump can name a permanent head, and make good on his promise to eviscerate the watchdog.

Time beats the clock in $2.8 bln deal

26 Nov 2017

After rejecting earlier entreaties, the publisher of People and Fortune is being bought by rival Meredith at a hefty 46 pct premium. It's a break for Time, whose go-it-alone strategy looked doomed. Bountiful cost savings, though, will help the buyer and backers the Koch brothers.

Cerberus puts German twist on distressed investing

15 Nov 2017

The private equity fund has bought 3 pct of troubled Deutsche Bank, months after taking a 5 pct stake in sickly rival Commerzbank. The twin investments might raise hopes of a merger between the two lenders. But other shareholders – including the German state – have a bigger say.

Private equity deserves U.S. tax hit, not startups

14 Nov 2017

Tech firms are understandably upset over a Senate plan to tax stock options when vested. It would raise $13 bln over 10 years. Ending a loophole on investment profit for buyout barons would bring in more. It’s a better target for Republicans already accused of favoring the rich.

GE’s shaman exorcises ghosts of false expectations

13 Nov 2017

It doesn't take much imagination at work to grasp John Flannery's approach to the $178 bln conglomerate. He has halved the dividend, cut earnings guidance and questioned GE's portfolio of industrial assets. Next up is a total restructuring of GE's bloated, under-engaged board.

Apple has deciding vote in Broadcom-Qualcomm deal

9 Nov 2017

A dispute over iPhone royalties left U.S. chipmaker Qualcomm vulnerable to rival Broadcom’s opportunistic $105 bln bid. Settling could preserve its independence. The question is whether Apple thinks a bigger Broadcom would be slavishly devoted, or even surlier.

Bill Ackman is losing his touch

7 Nov 2017

Fewer than one ADP shareholder in four backed the activist's bid for board seats at the payroll processor. That puts his Pershing Square hedge fund on a three-year losing streak after failed bets at Valeant and Herbalife – and makes it easy for other firms to ignore his demands.

Broadcom faces down ghost of chip LBOs past

6 Nov 2017

The $111 bln soon-American-again chipmaker offered $105 bln for Qualcomm. If the unsolicited bid goes anywhere, borrowing nearly $90 bln would send debt-to-EBITDA ratios towards leveraged buyout territory. Two former chip LBOs – Freescale and NXP – give pause for thought.

Wall Street gets reminder IPOs are no child’s play

3 Nov 2017

Goldman Sachs, JPMorgan and BofA presided over a 41 pct drop in pop-culture dollmaker Funko’s shares, the worst first-day showing in 17 years. Pharma firm Allena fell 29 pct. Faddish, highly leveraged and speculative firms can find a buyer – if bankers price them right first.

Chicago School gets $125 mln for being wrong

1 Nov 2017

The university’s tradition leans heavily towards free and efficient markets. Hedge-fund boss Ken Griffin’s name and cash – generated in an industry that depends on markets being inefficient – will now endow the economics department. Kudos to Griffin and Chicago’s open mind.

Aetna lays out its insurance value for CVS

31 Oct 2017

Revenue at the $56 billion health-coverage firm fell 5 pct last quarter, partly from dumping some Obamacare policies. But profit jumped 48 pct. That offers alluring protection for CVS, whose pharmacy and drug-benefit business is threatened by rising competition and transparency.

Axalta deal complicates Akzo’s juggling act

30 Oct 2017

Fresh from deflecting a takeover, the Dutch group is considering a merger of its paints unit with its U.S. rival. A combination makes sense. But new CEO Thierry Vanlancker is already grappling with weak results and a chemicals spinoff. That raises the risk of dropped balls.

U.S. economy doing just fine without tax cuts

27 Oct 2017

Initial estimates show GDP expanded at 3 pct in the third quarter, despite the hurricanes. Increasing inventories helped, but global growth and healthy corporate earnings are other positive signs. Trump will take credit, but protectionist policies could put the trend at risk.

Comcast earns its peacock feathers

26 Oct 2017

The $170 bln U.S. media firm was early and careful expanding beyond cable pipes. Two examples are its purchase of NBC Universal and its recently launched wireless service. Comcast stock has trounced Verizon and AT&T. Brian Roberts’ company has even topped Disney’s market cap.

Cox: Aramco clouds Saudi’s coming-out party

24 Oct 2017

The kingdom’s crown prince is hosting a mini-Davos this week to showcase Riyadh's charms as a financial center. From Masayoshi Son to Steve Mnuchin, participants may mostly avoid questions about one of his key goals: the touted but uncertain market debut of oil giant Aramco.