Nokia and Microsoft hook up

Posted by & filed under Company Analysis, Industry Analysis.

Description: The software and phone giants have teamed together to compete in the Smartphone market against Apple and other rivals.

Source: CNNMoney.com – video report

Date: 02/11/2011

Link:  http://money.cnn.com/video/news/2011/02/11/n_nokia_ms_quest.cnnmoney/

Questions for discussion: 

Do you believe this collaborative effort will prove to be successful?

  • How can this arrangement help cash flow and budgeting concerns for Nokia?
  • Do you think this is a first step towards a full merger?
  • Would such a decision be a good one for either firm or their stakeholders?
  • What would you advise investors to do now?

U.S. housing market going private

Posted by & filed under Economic Analysis, Industry Analysis.

Description: Let the great unwind begin. A report released by the Obama administration on Friday laid out a plan to reform the American housing finance market, saying the government should be more focused on oversight and consumer protection rather than direct involvement.

Source: BNN.com – video report

Date: 02/11/2011

Link:  http://www.bnn.ca/News/2011/2/11/US-housing-market-going-private.aspx

Questions for discussion: 

  • Summarize the changes anticipated in the housing industry and mortgage lending markets.
  • How will these changes affect buying attitude towards home ownership and borrowing rates?
  • How will this impact financial lending institutions?

Banks slashed small business lending by $43 billion

Posted by & filed under Economic Analysis, Financial analysis, Governments & Regulators.

Description:  The numbers back up what small business owners have been saying for two years: Main Street suffered a brutal credit crunch.

Source:  CNNMoney.com

Date: 02/11/2011

Link:  http://money.cnn.com/2011/02/11/smallbusiness/small_business_lending_drop/index.htm

Questions for discussion: 

  • Do you believe there was a credit crunch for small business?
  • How differently were bigger businesses treated by the banks?
  • How much affect do you believe these lending practices had on economic activity?
  • Could regulatory bodies have played any role in this scenario?

Borders Nearing Bankruptcy Filing

Posted by & filed under Financial analysis.

Description: Borders Group Inc. is in the final stages of preparing a bankruptcy filing after failing to persuade publishers and others to go along with a plan to refinance the troubled bookstore chain’s debt.

Source: Marketwatch.com

Date: 02/12/2011

Link: http://online.wsj.com/article/SB10001424052748704329104576138353865644420.html?mod=MKTW

Questions for discussion: 

  • What is Borders’ value today?
  • Make the case for a merger with another firm as opposed to a restructuring of the company’s debt.
  • Who would make a good partner for Borders?

At Center of Derivatives Debate, a Gung-Ho Regulator

Posted by & filed under Governments & Regulators.

Description:   Gary Gensler has his work cut out for him. As chairman of the Commodity Futures Trading Commission, he is leading the charge to overhaul the murky $600 trillion derivatives market, which was at the center of the financial crisis. The Dodd-Frank Act, the financial overhaul law enacted last year, requires Mr. Gensler’s agency to draft dozens of new derivatives rules by July.

Source:  NYTimes.com
 
Date: 02/10/2011

Link: http://dealbook.nytimes.com/2011/02/10/at-center-of-debate-over-derivatives-a-gung-ho-regulator/?ref=business

Questions for discussion: 

  • What rules do you think should be top priorities for the commission?
  • Do you believe Gary Gensler’s commission can succeed in changing the regulatory environment at play?
  • What alternatives are there to introducing new rules for derivatives trading?

Public Investors in Privately Held Companies

Posted by & filed under Governments & Regulators, Market Analysis.

Description: The lengthening time frame it takes for privately held companies to be acquired or to file for an IPO is spurring interest in startups that cater to investors who want to trade in shares of non-public companies. MarketWatch’s John Letzing interview with Thomas Foley, founder of Xpert Financial Inc., in San Francisco.

Source:  Marketwatch.com – video report

Date: 02/03/2011

Link:  http://www.marketwatch.com/video/asset/public-investors-in-privately-held-companies/6108F574-13EE-4BD8-98E0-65B756EC604C

Questions for discussion:

  • Explain how this new concept would work?
  • What are the risks associated with investing in this sort of market?
  • What would motivate an investor to go this route?
  • What should government and industry regulators be concerned with here?

Venture Capital As Patient Capital

Posted by & filed under Economic Analysis.

Description: Wall Street is in a transactional business, but venture capitalists are in a more long-term business of building companies — a sort of patient capital, according to legendary VC Bill Draper, author of “The Startup Game.” Jonathan Burton reports.

Source:  Marketwatch.com – video report

Date: 02/04/2011

Link:  http://www.marketwatch.com/video/asset/venture-capital-as-patient-capital/DC3C301D-95FD-4CB6-ABFC-43C0F8398F6A

Questions for discussion: 

  • Summarize the relationship between entrepreneurs and venture capitalists.
  • Why is the relationship typically longer term and non transactional?
  • What role should the venture capitalist play in the firm?

Good news. Yield ahead!

Posted by & filed under Economic Analysis.

Description:  Savers and investors relying on fixed incomes have been punished for several years. Many healthy companies sat on their growing piles of cash instead of boosting dividends. Some struggling firms were forced to cut or even suspend quarterly payouts during the financial crisis. And the Federal Reserve’s easy money policies (rates near 0% plus QE and QE2) have kept long-term bond yields at relatively low levels. But this is all slowly starting to change, giving conservative investors some reason to celebrate.

Source:  CNNMoney.com

Date: 02/04/2011

Link:  http://money.cnn.com/2011/02/04/markets/thebuzz/index.htm

Questions for discussion: 

  • Why is the bond market expected to improve at this time?
  • Do you agree with this argument?
  • What is the reason behind bond selling at this time?
  • What might undermine performance in bonds?
  • How should investors respond?

Stock-Hedging Lets Bankers Skirt Efforts to Overhaul Pay

Posted by & filed under Governments & Regulators, Management Issues.

Description:   Intent on fixing a banking system that contributed heavily to the recent financial crisis, lawmakers and regulators pushed Wall Street to overhaul its pay practices. Big banks responded by shifting more compensation into stock, a move intended to align employees’ interests more closely with those of investors and discourage excessive risk-taking.

Source:  NYTimes.com
 
Date: 02/05/2011

Link: http://dealbook.nytimes.com/2011/02/05/stock-hedging-lets-bankers-skirt-efforts-to-overhaul-pay/?ref=business

Questions for discussion: 

  • Summarize the report and the concerns with Wall Street behaviors.
  • Do you believe there is a need for more regulatory involvement and if so, what should it be?

What’s after Dow 12,000 and S&P 1,300?

Posted by & filed under Market Analysis.

Description: On Tuesday, the market hit a double milestone: The Dow Jones Industrial Average closed above 12,000, and the Standard & Poor’s 500 index finished the day over 1,300.

Source: Marketwatch.com

Date: 02/04/2011

Link: http://www.marketwatch.com/story/what-comes-after-dow-12000-and-sp-1300-2011-02-04?siteid=nwtwk

Questions for discussion: 

  • Summarize the basic arguments made in the report.
  • Where do you think the markets are heading?
  • How would you be approaching investing at this time?