Daily Archives: February 7, 2009

Management Forecasts And The Inevitability Of Exaggeration

cammonopoly_wideweb__430x32504The press has not learned, despite repeated experiences, that televangelists, medical researchers, elected politicians and chief executive officers are often incapable of telling the truth. That is not to say that they are liars. It only means that, at their core, all of the people in these professions are driven to make their world look as bright as possible. Every Congressman promises to bring prosperity to his district even if the next set of appropriations will send his constituents nothing. CEOs are rarely willing to say that their companies are in trouble. Read More »

Posted on: February 7, 2009 – 11:15 pm in Banking, Conglomerates, Corporate Governance, Management Change, ,

OPEC’s Final Humilation

tx-00338-coil-well-gusher-odessa-texas-posters1The price of crude oil has refused to rise even though OPEC has lowered production and threatened to further reduce exports. The September decrease of two million barrels a day was followed by a drop in prices. The cartel had no better luck at its December meeting when it cut roughly another two million barrels a day and insisted that all of the nations in the group adhere to the new export policies. The crude futures markets were not entirely convinced that some of OPEC’s more impoverished members might be sneaking supply out the back door to bring in cash.

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Posted on: February 7, 2009 – 10:22 pm in Oil & Gas

Week Ahead: Coke vs. Pepsi Investor Taste Test (KO, PEP)

This coming week will mark the earnings reports for two key household consumer stocks, both of which were supposed to be defensive.  The Coca-Cola Company (NYSE: KO) reports earnings on Thursday and Pepsico, Inc. (NYSE: PEP) is set to report earnings on Friday, February 13, 2009.

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Posted on: February 7, 2009 – 10:39 am in Consumer Goods, Defensive Stocks, Earnings, Food, ,

IMF: Depression May Have Already Started

AngrybearFor some countries, it may already be too late to keep their economies in a recession hoping for a recovery late in the year.

That notion would make some sense. In the US and UK, unemployment is almost certainly headed toward 10%. If people out of work and no longer looking for jobs are included, the figure could move much closer to 15%.

Consumer and business spending have virtually shut down because of lack of access to credit. In the US, several major industries may be in the late stages of complete failure. This would almost certainly include the retail and automotive sectors, and could, if the government does not take appropriate action, move to the largest financial firms.

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Posted on: February 7, 2009 – 7:34 am in Uncategorized