Hand it to Dell (DELL), probably the worst run of the large global PC companies to have bad timing.
It is launching a new line of expensive, high performance laptops. The new products will be called Adamo and will cost about $2,000. In a recession, consumers are likely to grab them off the shelves so fast the Dell will be out of inventory in a week. Read More
Intel (INTC) has been trying to get rid of its smaller competitor, AMD (AMD), for years. It may have even gone too far according to antitrust regulators in Europe.
But, now Intel has a better sword in its hand and AMD’s survival could be at stake. At $2.48, AMD trades near its 52-week low and is saddled with a large debt burden. Read More
Starbucks (SBUX) seems hell bent on cutting its way to profitability. It may work, but it is also possible that the economy has gone through such an upheaval that the coffee chain no longer has much of a place in the fast food restaurant business.
According to The Wall Street Journal, ”After years of broadening its customer base and making forays into entertainment, Starbucks has made its top priority retaining its existing patrons.” But, what if those “existing patrons” have left the building? Read More
The Administration appears to be ready to give GM (GM) and Chrysler more money. According to The Detroit Free Press, the car companies are about to get further aid in the form of more government loans. The paper says that “President Barack Obama’s automotive task force doesn’t see bankruptcy as the best solution for the industry’s woes.”
How will GM use the money it will probably get from the government? It will cut prices on its cars so that it can lose more money. Read More
Over the past week 24/7 Wall St. has picked several stocks from major sectors that are likely to double off of their lows. This group focuses on the transportation sector with the picks being Continental Airlines, Inc. (NYSE: CAL), i2 Technologies, Inc. (NASDAQ: ITWO), Kansas City Southern (NYSE: KSU), Overseas Shipholding Group Inc. (NYSE: OSG), and Ryder System, Inc. (NYSE: R).
We have more details on why we like these over peers, but there are several suppositions in our opinions here. The time frame is by the end of 2010, which is meant to coincide with some form of economic recovery next year. A number of the credit and financial issues facing the markets will be in place for the near-term or longer. The other assumption used for choosing the stocks is a market bottom of roughly 600 on the S&P 500. Unfortunately, there is also the added risk of energy costs and now a new emissions “cap-and-trade” tax to consider.
Read More
It looks like “All Fools Day” will come early on Wall St. this year. Several banks are going to try to raise the base salaries of key employees to dodge the federal government’s mandate to cut big bonuses at firms which have received bailout money. If increasing base payouts did not so obviously flaunt the intent of the programs that Congress and the Administration are putting into place, the plan would be brilliant.
According to The Wall Street Journal, “Under the forthcoming rules, bonuses could come to no more than one-third of the total annual compensation paid to employees covered by the restrictions.” Read More
Now that final numbers from 2008 have been filed for most large US companies, 24/7 Wall St. is picking several stocks that are likely to double off of their lows, almost all of which were set over the last two weeks. The time frame for these price increases is between now and the end of 2010, when many experts expect the economy to recover. A number of the credit and financial issues facing the markets will remain for the near-term. It may be well beyond the end of next year before the economy returns to the kind of GDP growth it had in 2006. The other assumption used for picking these companies is a market bottom of 600 on the S&P 500. If the index goes well below that, it is anyone’s guess how soon stocks will recover to the levels where they trade today. Read More
According to Reuters, Obama faces backlash due to AIG (AIG) compensation issues which could set bank his efforts to salvage the financial system.
Reuters reports that Lehman will put two of its banking units on the block.
Reuters writes that GM (GM) bondholders say that their plan to save the company is the best chance for the car company.
Reuters reports that Alcoa (AA) cut its dividend and will try to raise cash.
Reuters writes that Obama unveiled his plans to help small business.
Reuters writes that Hearst closed the print edition of its Seattle paper. Read More
Markets in Asia were higher
The Nikkei rose 3.2% to 7,949.
The Hang Seng was up 1.3% to 13,129.
The Shanghai Composite rose 3% to 2,218.
Data from Reuters.
Douglas A. McIntyre
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