Market Talk

Let's just remove 'vampire squid' right here.

I’ve long thought that advertising is the most important industry in America, and that’s not just because I’ve seen every episode of “Mad Men.” No other industry is tasked with the all-important task of getting people to spend money they may or may not have on products that almost never need, or may even be harmful to them. That’s quite a task, but year in and year out, America’s ad men get us buzzing over all manner of nonsense, and spending money like drunken sailors.

Which brings us to a very special Market Talk snippet that ran on the Broadtape today. Apparently, Goldman Sachs, perhaps you’ve heard of them, embarked upon an advertising campaign (along with a spiffy website) to clean-up its image with the masses. They bought a full-page, full-color ad in today’s Journal (page A7), bragging about how through its expertise in the capital markets it helped some wind company create, you know, windmills, and…wait for it…jobs!

Goldman Sachs, progress is everyone’s business. Makes you feel warm all over, doesn’t it?

Needless to say, we had a lot of fun trying to come up with a headline for this one. An item like this is a cynical headline writer’s nirvana. Most of our ideas were unprintable. What we finally came up with was printable, and we thought, hey, let’s have some more fun.

So, dear readers, today’s challenge is to come up with the sharpest, wittiest headline for the following item. Be creative but keep it clean (dashes and symbols are acceptable,) this is a family blog. Submit your headlines in the comments below. Winner gets a t-shirt (okay, that’s not true. We don’t have t-shirts. The truth is the winner gets absolutely nothing. But if we had t-shirts, we’d give you one.)

Here’s the item:

MARKET TALK: Oh, We Know Who You Are

12:20 (Dow Jones) Goldman Sachs (GS) rolled out a new advertising campaign today designed to clean up its image by showing how it promotes business growth and job creation by financing companies, governments and institutions. The full page ads, which depict wind turbines and a hard-hat wearing worker, ran in the Wall Street Journal and New York Times and are set to run in other national and regional papers, including USA Today. GS, which has taken a public and political beating in the last year, is using the ads to explain “who we are and what we do,” a spokesman says. GS down 0.7% at $143.93. (liz.moyer@dowjones.com)

Don’t leave us hanging, Raymond, Tyler, J., Brad, Beverly and everybody else.

- Big Picture blogger Barry Ritholtz addresses the ongoing inflation/deflation debate. “Deflation is a fact. It is happening now, it is real, and we see it in the actual data,” he says. But the first hint of inflation will come from the bid-to-cover ratio on Treasury bond auctions. “That will be your early inflation warning. But now? It’s nowhere in sight.”

- Initial jobless claims are still “stubbornly high” at 457,000, Miller Tabak’s Peter Boockvar says. “GM not shutting auto plants as is typical this time of the year is still a distortion but it is surprising that claims aren’t lower because of it,” he says. “Thus current levels still remain a concern at this stage of an economic recovery.”

- And what’s worse, jobless claims have essentially been stuck in neutral during the last eight months, The Economist’s Free Exchange blog notes. “Claims are stuck at an historically high level. Perhaps that merely reflects some new structural dynamic in the labor market, but it mainly seems suggestive of continued economic weakness.”

- While the advertising industry was crushed during the financial crisis, recent signs have pointed to a comeback. “But it’s not back everywhere. And it’s probably not as strong as you think it is,” MediaMemo blogger Peter Kafka cautions.

- RIMM’s rumored new operating system “should have released years ago, one that should give its devices a bit more appeal in a market increasingly enamored of super-smartphones,” Digital daily blogger John Paczkowski says. “So if the 9800 is announced next week along with a rumored mid-August ship date, RIM will have taken its first big step in addressing the competitive issues that are tarnishing its growth prospects.”

- Moody’s, S&P and Fitch have recently refused to allow their ratings to be used in bond registration statements, fearing they’ll be exposed to new liability from the financial reform legislation. “You can file this one under D for Despicable,” Joshua Brown writes at The Reformed Broker. “Let me put this in schoolyard terms: The ratings agencies are playing chicken against the US economy. The message is to insulate them from responsibility or else they’re taking their marbles and going home.”

- Investing is “an uphill climb against human nature to be bullish when conditions are poor,” the Dorsey Wright Money Management blog says. “To buy when the outlook is dim takes a real leap of faith — and a steadfast optimism that things will improve over time. When things seem like they can’t get any worse, it just might be because they really can’t get any worse–and are about to get better.”

- Payrolls typically lag durables by four months. “Now, the year-over-year change in durables probably peaked a couple of months ago at 19%,” Invictus writes at The Big Picture, noting comps are going to start getting harder to beat. “I fear the hour is growing late and we’re rapidly running out of time as the labor market continues to struggle. I see nothing stimulative on the horizon as far as employment goes.”

- Avis goes to war for Dollar Thirfty. NYT’s Deal Professor Steven Davidoff has the details.

- “Erasing years of academic progress, state education officials acknowledged that hundreds of thousands of children had been misled into believing they were proficient in English and math, when in fact they were not,” WSJ says.

Brought to you by Budweiser.

Of all the pitches I get on a daily basis, and I get too many of them, the dumbest one I’ve ever gotten, by far, just landed in my email inbox. It’s so stunningly idiotic that I absolutely have to succumb to my baser instincts, and actually give them the publicity they crave.

I’m talking, of course, about the World Beer Pong Championship.

I bet you didn’t know beer pong was a professional sport, did you? I didn’t either. The last time I thought about beer pong was probably 20 years ago, in somebody’s basement, trying to get that little ping pong ball into those plastic cups. How in God’s name can beer pong be considered a real sport? It’s a dumb drinking game. What’s next, professional quarters?

The beer pong people are hosting their championship tournament this weekend in Atlantic City. Now, what brainiac decided to put the league’s premier event up against the World Cup? What were they, drunk? Well, they probably were drunk. But there is one thing that the existence of a professional circuit for beer pong proves: that all sports, football, futbol, baseball, basketball, the Olympics, beer pong, are just conduits to sell advertising.

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- John Hussman writes about a subset of market conditions that have historically been associated with sharply negative implications for stocks. “The combination of unfavorable valuations and collapsing market internals is a sharp warning to examine risk exposures carefully here,” he says.

- Job prospects are showing signs of life for college graduates. But make no mistake, they the labor market is far from thriving.

- European banks not for the faint-hearted investors. “It makes more sense to simply bypass these stocks until the story is over unless you are more of a trader or don’t mind very big swings,” writes Roger Nusbaum. The consequence for being wrong is greater with these banks. Obviously this will be too conservative for some folks but ultimately this is a know thyself question.”

- Facebook CEO Mark Zuckerberg addresses new privacy settings in a Washington Post op-ed, hoping to quell privacy concerns. But his memo seems like a “classic non-apology,” MediaMemo blogger Peter Kafka says. “He’s sorry that Facebook ‘move[d] too fast.’ That’s the kind of thing you say in a job interview if someone’s lazy enough to ask you to describe your biggest weakness — ‘Sometimes I try too hard.’”

- The fact that current and former AIG executives won’t face criminal charges seems baffling. But “if you rope your advisors like your accounting firm into signing off on your stupid or possibly even criminal behavior, then you get off scot-free,” Yves Smith writes at naked capitalism.

- Existing home sales increased more than expected, but keep an eye on inventory levels, Bill McBride notes at Calculated Risk. Inventory rose to 4.04M in April from 3.63M in March. It’s also an increase from April 2009, breaking a string of 20 consecutive months of y/y declines in inventory. “The increase in inventory is the big story.”

- Twitter announces it’s banning in-stream advertising from third-party developers, which “are not necessarily looking to preserve the unique user Twitter has created,” COO Dick Costolo writes on Twitter’s corporate blog. “We believe it is our responsibility to encourage creative product development and to curb practices that compromise innovation.”

- What are the implications of Twitter’s move to ban third-party ad networks? “Twitter has now reduced the number of companies trying to figure out their optimal business model from thousands to 1,” angel investor Chris Dixon says in a tweet.

- Intel (INTC) introduces a series of low voltage chips that could make the price for ultra-thin laptops more attractive and affordable, Digital Daily blogger John Paczkowski says, which “bodes well for the ultra-thin laptop which hasn’t had much success staking out a middle ground between the netbook and the laptop because its performance often doesn’t justify its price.”

- Some excellent explanations of the Lost finale.

- VIX volatility index can be a great contrarian indicator — problem is, it’s a backward-looking gauge, Tom Petruno says.

- Crude oil’s getting sneaky high and no one seems to care. “One explanation is that oil prices haven’t climbed as fast as they did in early 2008, with the slope of the ascent being a primary source of worries,” Paul Kedrosky writes.

- “The key to long term economic health, though, will be a greater contribution from exports and less on borrowing and spending all over again,” Peter Boockvar notes.

- He’s chairman and CEO of the world’s largest health-care conglomerate, Johnson & Johnson (JNJ), but yesterday Bill Weldon took on a new role: blogger.

- Twitter users will not abandon the microblogging service just because it will start running search-based advertising, Forrester analyst Josh Bernoff says.

- Rumor du heure for Palm: Let Intel buy them, Jason Perlow writes.

- Google (GOOG) reportedly developing a new tablet device compatible with Android would be great for Adobe (ADBE), but not so good for Apple (AAPL).

- Tech blogger Om Malik gets his hands on Microsoft’s (MSFT) new Kin smartphones, but doesn’t exactly offer a stellar review.

- “If the US economy was about to reach “escape velocity” as Larry Summers says, small business optimism would not be in the gutter and sinking,” Mish says.

- “We live in an age of unprecedented bailouts,” Simon Johnson writes. “The Greek package of support from the eurozone this weekend marks a high tide for the principle that complete, unconditional, and fundamentally dangerous protection must be extended to creditors whenever something “big” gets into trouble.”

A more honest time?

It’s amazing to me, and so clearly illustrates the problem, that an “unscripted” meeting between President Obama and a group of vacationing Republicans is getting such notice. From the Times:

BALTIMORE — President Obama denied he was a Bolshevik, the Republicans denied they were obstructionists and both sides denied they were to blame for the toxic atmosphere clouding the nation’s political leadership.

At a moment when the country is as polarized as ever, Mr. Obama traveled to a House Republican retreat on Friday to try to break through the partisan logjam that has helped stall his legislative agenda. What ensued was a lively, robust debate between a president and the opposition party that rarely happens in the scripted world of American politics.

The packaging of politicians has been getting progressively worse for 50 years, from the moment John Kennedy showed up looking better on TV than Richard Nixon to that outrageously overproduced moment on the USS Abraham Lincoln when President Bush declared “mission accomplished.” That President Obama and members of the opposition party sparred in an unscripted exchange the other day, the kind of water cooler debate that takes place every day at less elevated levels, is almost unheard of in this day of handlers, spin doctors, flaks and ad-men masquerading as “strategists.”

It would be nice if we could have a class of politicians that weren’t sold to us the same way we’re sold soda. We might even get a more honest group of representatives, one who aren’t so easily manipulated by moneyed interests. A guy can hope.

Movies, as you know, are fiction. Film is an actually illusion, a series of thousands of still images played at such a speed as to make them “move,” to make it seem as if what you are seeing is real. But it isn’t. The same production job has been done in Washington, and too often, what you are seeing isn’t real, either.

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It could have been the only one.

If I ever leave journalism for some reason, I’m going into advertising. Besides the fact that I’ve seen every episode of “Mad Men,” I’m telling you, I just have a mind for for all that ad-related and marketing kind of stuff.

Take Google’s new smartphone, for example. Now, they call it the Nexus One, and there is just something wrong with that name. It doesn’t roll off the tongue. It’s a bit awkward, and far too geeky. Compare it to iPhone. Two short syllables, a bit geeky, but extremely easy to remember. And because Apple names everything the “i” something, it’s become an identifying feature of their products.

It took me a day, but I realized what Google should have named their phone. I was reading an article in the Journal about it, staring at that name, Nexus One, and I realized what name they should have gone with.

One.

That’s right, Google should have called their phone “One.”

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I made it better!

I’ve been avoiding this post, because really, it’s low-hanging fruit. But I see this thing every day, and I just can’t take it anymore. I’ve got to get this off my chest.

Every morning I walk by this absolutely gigantic Microsoft for Windows 7 ad, tethered across two sides of a building on the corner of 42nd St. and 8th Ave. outside the bus station in midtown. They’ve actually changed it three times now, but they’re all part of the “I’m a PC, and Windows 7 was my idea” campaign.

The ads, and related commercials, are well produced, light-hearted, and I guess they make the company seem more “human.” But what they really do is substantiate every point their detractors have been throwing at them for years. What company does that?

Has there ever been a more jaw-droppingly tone-deaf ad campaign? I have no advertising experience, apart from having seen every episode of “Mad Men,” but, I mean, would Mercedes runs ads saying their customers retooled the engine of the new E-class? Of course they wouldn’t, they’d look like idiots.

In one ad, a girl in a coffeeshop says it was her idea to make the operating system less prone to, you know, ha ha, crash. In another, a woman sitting on porch says it was her idea to make the system less prone to, you know, smile widely, allow your personal information to get ripped off.

You mean, not one person who draws a paycheck from Microsoft noticed those little issues?

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Revenue? Overrated. Profits? Fuggedaboutit.

These are small potatoes for Twitter – the microblogging sensation which reportedly is close to raising about $50 million that will value the hot start-up at $1 billion, according to TechCrunch. Twitter raised $35 million earlier this year, led by Benchmark Capital and Institutional Venture Partners.

Pretty remarkable, especially considering the company still doesn’t generate any meaningful revenue, MediaMemo blogger Peter Kafka says.

“Feel free to debate the merits of Twitter’s growth prospects,” he says. But given Twitter’s apparent course, the funding seems obvious.

Twitter’s repeatedly insisted it wants to build a strong independent company instead of selling out to Google (GOOG), Microsoft (MSFT), Facebook or any other prospective suitors.

“If they weren’t going to sell, raising yet more money to give the company time and resources to build out a real business is the logical choice,” Kafka says.

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So I caught GM’s new ad over the weekend, the one with freshly minted CEO Ed Whitacre walking through what looks like a set that’s supposed to look like a real engineering lab and touting GM’s cars.

Let’s be charitable and say that in his first try out of the box, he’s a little stiff. While the braintrust at GM probably hoped he’d be a latter-day Lee Iaccoca, he’s doesn’t quite manage the swagger of the old Chrysler chieftain.

Back in the ’80s, when Chrysler had, as Iaccoca put it, “one foot in the grave,” he became the face of the company, and in some ways, the face of America, an America struggling to keep up with the competition, which was handing us our lunch.

Iaccoca was a natural pitchman. Whitacre, meanwhile, well, he’s just not a natural pitchman. It’s not that the messages are that far off, actually. But there is one key difference.

“A lot of people think America can’t cut the mustard anymore,” Iaccoca starts off, dismissively. He’s loose, he’s charismatic, he’s bold. He brags about his cars with such an easygoing manner, you don’t realize the outrageous claims he’s making. He says, we’ll build cars as good as BMW and Mercedes. He says, we’re going to beat Japan at its own game.

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