Daily Archives: January 19, 2008

Merrill Lynch (MER) May Face A Judge

Merrill Lynch (NYSE:MER) sold the city of Springfield Mass a financial instrument which lost 90% of its value. According to The Wall Street Journal "Merrill violated state law by not properly informing the city what it was buying."

Christopher Gabrieli, who runs the city’s finances, wants his money back.

Gabrieli and his friends are one in a parade of boobs who appear to have wanted big returns but were not willing to apply proper due diligence to what they were buying. The man may be unhappy, but the result should be that he is pushed out of his job. He says Merrill did not send him details on the investment until it was too late. The real question is why he did not ask for them before he wrote Merrill a check.

Over the next few months, countless municipalities and institutions will complain that firms like Merrril robbed them. In reality, the buyers failed to read the fine print.

Caveat emptor.

Douglas A. McIntyre

Posted on: January 19, 2008 – 10:40 am in Financial Stocks,

Eddie Lampert’s Last Stand (SHLD)

Eddie Lambert has been a bust as a retailer. He may be fine at running a hedge fund, but due to his large holding in Sears (SHLD), that distinction may be shaky as well.

It is easy to blame the problems at Sears on the overall retail market. That is until Wall St. looks at Sears and the shares of rivals like Wal-Mart. Over the last year, WMT shares are fairly flat while Sears is off 50%.

Yesterday word leaked that Lampert would break Sears into several operating units. According to The Wall Street Journal "the contemplated restructuring would create separate units to manage Sears’s real-estate holdings and run brands such as Kenmore, Diehard and Craftsman." The fate of the management of Sears and K-Mart stores is not known. It is also not clear why the units will not simply have powerful brand managers within the current structure similar to the Procter & Gamble (PG) system

It may be that Lampert wants autonomous units so that he can more easily sell them. But, none of the units is doing well enough to appear to warrant a premium.

Radical changes in management and operating structure at big companies often take several quarters to settle in. That make the Lampert move all the more bizarre. He is running out of time and anything that compromises making changes over the next few months is bound to do more damage to Sears.

Douglas A. McIntyre

Posted on: January 19, 2008 – 8:58 am in Retail, , ,

Google (GOOG) Lose Is Microsoft’s (MSFT) Gain

Google (GOOG) lost a little bit of its prized search share in December according to Nielsen.

Compared with November numbers, Google’s piece of the US market fell from 57.7% to 56.3%. Microsoft’s (MSFT) part of the pie moved from 12% to 13.8%. But, MarketWatch writes that "in November, Microsoft began an effort to lure users to its search services by offering prizes such as T-shirts and video games." In other words, those people may not stick with Microsoft.

Yahoo! (YHOO) also lost share dropping from 17.9% to 17.7%. With its shares dropping close to $20, down from  52-week high of over $34, it cannot afford to fall any further. Maybe it needs to set up some contests to get people to use its search features.

Douglas A. McIntyre

Posted on: January 19, 2008 – 8:37 am in Internet, , ,

This week on Stockhouse January 14 – 18

Markets continued to reel as investors took a chainsaw to the third trading week of 2008. Gold faltered and oil continued to pull back from the hundred-dollar high. On Thursday, Ben Bernanke said some disconcerting things that offered no solace to the bulls, while on Friday, George Bush revealed thoughts from the White House on what kind of fiscal policy support might be instituted to stave off increasing recessionary forces. Stocks dropped on cue.

On Monday…

Danny Deadlock offered a look at the oil and gas service sector – and narrowed his sights to one company in particular in Energy service stock deserves a second look.

Buzz on the Boards covered the goings-on over at the Bullboard for Canada’s gift to the hand-held device market in Investors believe in RIM. After that, buzz paid a visit to the Rick’s Cabaret International (NASDAQ: RICK, Bullboards) board in Rick’s Cabaret International goes its own way.

Luke Brocki brought Stockhouse readers the latest scoop on developments in the uranium sector, including a deal for China and news of the British government’s support for new nuclear plants in Uranium prices remain stalled.

Gold, silver and uranium rounded out the Monday edition of Buzz on Commodities in Yellow metal up, yellowcake down.

The 24/7 Wall St. News Desk covered five of the movers and shakers followed by Stockhouse members in a weekly report called Xemplar Energy issues no news press release as shares slump.

Read More »

Posted on: January 19, 2008 – 8:29 am in Uncategorized