What Is Important in the Financial World (4/8/2013)

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The highest court in Portugal ruled that some of the austerity measures to be employed by the government to curtail deficits are not constitutional. In reaction, the central government said it would accelerate some cuts, as Portugal’s economy slips deeper into recession and unemployment reaches levels unprecedented in recent times. If the court can block much of the austerity actions, Portugal’s cost to raise money may skyrocket, which would put the future of its bailout by the European Central Bank, European Union and International Monetary Fund in danger. According to CNBC:

With Portugal’s main court rejecting cost-cutting measures which are central to financial aid, the country’s already faltering austerity program has been thrown into further doubt, adding to pressure on the euro zone, analysts told CNBC.

“Fiscal austerity in Portugal is failing,” Nick Spiro, head of Spiro Sovereign Strategy, told CNBC. “Portugal’s 2011 bailout program went off track some time ago. If it were not for the troika’s leniency and the dramatic rally in Portuguese debt, the program would have already failed by now.”

Highest Paid CEOs

CNN Money released its list of the 20 highest paid chief executive officers of 2012. It was refreshing to see some of the CEOs that have led their companies to long-term success made the list. Mark Parker of Nike Inc. (NYSE: NKE) was fourth at $35.2 million. He has warded off stiff competition from several other athlete gear and shoe companies, the first among them Adidas, which owns Reebok. Third on the list is Bob Iger, CEO of Walt Disney Co. (NYSE: DIS), who made $37.1 million. He has kept Disney among the top multimedia companies in the world and has balanced the success of its television network (ABC), studios and theme parks. And first on the list is Larry Ellison, founder of Oracle Corp. (NASDAQ: ORCL). He hardly needs the money and could work for $1, based on his extraordinary wealth. Forbes rates Ellison as the third richest man on the Forbes 400, with a net worth of $43 billion. Ellison made more than any other U.S. public company CEO in 2012 — $96.2 million. Ellison has kept Oracle in competition with other industry giants, which include International Business Machines Corp. (NYSE: IBM), Microsoft Corp. (NASDAQ: MSFT) and SAP A.G. (NYSE: SAP). And he has been more effective than most, making smart M&A decisions and integrating new companies into the parent.

British Airways and Boeing

British Airways appears close to an order of $7 billion of Airbus A350 planes. The airline traditionally has been a customer of Boeing Co. (NYSE: BA). However, that could change is a matter of days. According to Reuters:

If confirmed, the order would strike a blow inside one of Boeing’s most loyal wide-body customers and may hike pressure on the U.S. planemaker to defend future profits by formally offering a revamped version of its successful 777 mini-jumbo.

Industry sources said on Sunday that International Airlines Group), which owns both BA and Spain’s Iberia, appeared close to ordering approximately 20 Airbus A350-1000 aircraft worth $332 million apiece at list prices.