Motorola (MOT) missed a lot of its numbers for the third quarter. Much more important than that it fudged when it might dump its handset unit. The deal was supposed to happen in the third quarter of 2009.
If Motorola’s handset numbers get worse, the transaction may not happen at all.
Revenue fell from $8.8 billion in the period last year to $7.5 billion in the most recent quarter. MOT had an operating loss of $452 million compared to a loss of $10 million in 2007.
It has only taken a week for the global auto business to rebound from one of its worst periods in decades.
GM (GM) is close to a deal to buy Chrysler. The Federal Reserve may kick in $10 billion to help the companies fire 40,000 people so that the merged company can have better margins. GM’s stock is up on the good news. The fact that no one has wanted to buy a Chrysler product for the last two years does not matter much.
When the stock markets around the world raced down earlier this month, there was some sense to it. The credit and liquidity troubles were real. Corporate earnings became progressively troubled. Layoffs showed clear signs of accelerating. Housing values continued to fall and mortgage default rates got worse.
To put a point on it, there were ample reasons for the markets to become undone and for panic to reign.
Wall St. is a den of thieves and NY Attorney General Andrew Cuomo wants to wipe them out on his way to becoming governor like his father was before him. His latest attempt to get some time in the headlines is to ask nine financial firms to show him their lists of management bonuses before the checks are written.
Cuomo is after the banks which are getting money from the new Paulson bailout facility Why be believes he has any jurisdiction in the matter is pure conjecture.
If you don’t like the game, change the rules. At least that is what the nation’s banks would like to have happen. They are making the case that if accounting practices were "correct", they would not have had to take all of those losses for their remarkably poor risk management.
The argument is simple. If Draconian GAAP measures to value bank assets had been more "accurate", much of that red ink could have been avoided. Perhaps banks would not have had to raise so much money. Perhaps the government bailout could have been avoided altogether.
According to Reuters, investors and banks are in a struggle over whether financial companies should be able to change the way they value assets under accounting rules.
Reuters writes that improvements in Asia markets show that investors are returning to taking risks.
Reuters writes that GM (GM) and Chrysler have agreed to all major terms for a merger.
Market in Asia rose sharply.
The Nikkei was up 10% to 9,030. Kyocera and Mitsubishi Corp rose sharply.
The Hang Seng rose 10.3% to 14,005. CNOOC rose by double digits as did PetroChina (PTR).
The Shainghia Composite was up 2.6% to 1,764.
Data from Reuters
Douglas A. McIntyre
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