What's Important in the Financial World (1/31/2012) Apple Retail Chief, EU Unemployment
EU nations, led by Germany, have approved a permanent bailout fund, the European Stability Mechanism, which has 500 billion euros. But that does not mean a rescue for Greece. On the contrary, if the European Union views Greece as beyond salvage, it may reserve the money for aid to the more viable economies of Spain, Portugal and perhaps Italy. Greece still has not settled a dispute with its private bond holders. And, it remains at odds with Germany over how much control it should have over its own budget. The irony of the situation is that, just as the money to save Greece is in place, Greece kills its chances to get any of it.
Changes at RIM
The independent directors of Research In Motion (NASDAQ: RIMM) did what they should have long ago. They decided that the company ought to have one person as CEO and another as chairman. Co-chief executive officers Jim Balsillie and Mike Lazaridis also had control over the board as RIM ruined its own fortunes with a series of bad decisions about how it should evolve from a BlackBerry-driven company to one with a larger set of smartphones. In the meantime, the firm’s share price dropped by more than 80%. There has been little mention of the board’s important but cloaked role in the trouble.
The European Union’s statistics office Eurostat reported that unemployment in the 17-nation area reached 10.4% in December. That is an indication of the struggle the region faces as it tries to repair its finances and stay out of a regionwide recession. Some data show that Germany has dodged the fate of its neighbors, but that is the only bright light among the nations in the alliance. The unemployment number will raise the issue for the 1,000th time about whether austerity can ever be compatible with the actions needed to stimulate economies and employment.
Apple Retail Chief
John Browett of Dixons Retail will join Apple (NASDAQ: AAPL) as the head of its 361-store retail operations. Why Apple did not promote one of its own executives is a mystery. It hardly matters. Apple’s retail locations are constantly swamped with customers and, even as the company adds stores rapidly, that is not likely to change. Browett will get to ride the wave of that success without the slightest need to do anything but hang on.
Douglas A. McIntyre