Lot of Washington-type cross-currents floating around today. You had the new credit-card rules go into effect, you had the President unveiling his latest tweaks — as most seem to be calling them — to his healthcare proposal, and you have these dueling financial-reform bills on deck for some time this week.
And while I personally think the biggest issue is financial reform, it’ll have to wait for another tomorrow, because today on Tomorrow’s News Today, we’re talking about the healthcare plan, as well as Toyota’s mounting problems and Janet Yellen’s pronouncements. And as Madeleine says, it’s time to get something done on healthcare.
- Europe’s announced support for Greece was “badly bungled,” former IMF chief economist Simon Johnson says. And if the euro continues to depreciate, he believes the G7 will need to weigh in on the situation.
- Palm not exactly lighting it up in Verizon stores, but should benefit long-term. “Palm will be well-served with Verizon as a partner, but its challenge – as always – is one of awareness,” John Paczkowski says. “Once it overcomes that, increasing carrier momentum should follow.”
- Apple’s (AAPL) iPad is more than just a fancy gadget. “When I look at the iPad, I see a clean slate to reinvent pretty much how we think of media, information and in fact the whole user experience,” Om Malik says.
- Google wastes no time announcing privacy improvements for Buzz. “It’s still early, and we have a long list of improvements on the way,” Google’s Tom Jackson writes in a blog post.
- Unfortunately, Toyota has a thing or two in common with the banks. The good news, Barry Ritholtz notes, is the auto maker doesn’t need a bailout, and “they didn’t cripple the world’s economy.”
- All the jostling surrounding the financial-reform bill in the Senate is getting a bit confusing, Reuters blogger Felix Salmon says. “I’ve been pessimistic throughout this process,” he writes. “After decades of getting exactly what they want, I just can’t believe that the banking lobby is now going to end up getting exactly what they don’t want.”
- Let Greece go to the IMF, Harvard economist Jeff Frankel suggests.
- Do e-readers cause eye strain? “It turns out the answer isn’t as black-and-white as we might assume,” NYT’s Bits blog says.
- FT Alphaville wonders where all the bonus rage has gone.
- Olympic luger dies after training crash, just hours before the opening ceremony.
Yes, Eduardo called the Saints, and I called the Colts. So there you have it. Elsewhere in the world, Toyota’s problems are extending to the Prius, and G7 ministers discover that it’s cold in Canada, but it doesn’t seem like they came to many other hard conclusions.
In today’s edition of Tomorrow’s News Today (the best three minutes you’ll invest all day,) we look at ADP’s jobs report and the ISM services report, and what they mean for the economy. And the fallout from Toyota’s recall problems just keeps getting worse.
-It only took two weeks and a 6% pullback in the stock market, but more newsletter writers are looking for a correction than at any other time since 1984, Bespoke reports, citing data from Investors Intelligence.
- A Kauffman Foundation survey of economic bloggers found what many already expected: we share a bleak economic view. “While [bloggers] individually express themselves virtually every day, we think their collective voice needs to be heard,” says Tim Kane, senior fellow at Kauffman and author of the study.
- Time Inc says 4Q subscription revenue down 6% from year ago and ad sales dropped 12%. Not great, but better than 3Q, when the declines were worse in each category. “Requisite caveat here: These numbers…are being compared to really terrible numbers from the previous year,” Peter Kafka says. “So the fact that Time Inc can’t show actual growth tells you that this is still an industry with really big problems.”
- Strategic defaults on mortgages gaining steam. “The longer the real estate bust continues, the more deeply underwater borrowers will think hard about the costs of upholding their side of a deal,” Yves Smith notes.
- A dandy revenue comeback? Not quite. Year-over-year revenue growth “leaves much to be desired,” Pragmatic Capitalist says, as revenue ex financials is up just 3%. “Not exactly a barn burner in top-line growth,” blog says. “And this is in comparison to the very weak 4Q08 when the economy was nearly lifeless.”
- AOL’s 4Q ad and subscription revenue fell. “Again, recall that these numbers are against miserable comps from a year ago, when advertisers and publishers just sat in the dark with towels over their heads, crying,” Kafka notes. CEO Tim Armstrong certainly has his work cut out for him.
- ADP says only 22,000 private-sector jobs were lost in January, the smallest decline since February 2008. “The less-bad theme continues,” says Miller Tabak equity strategist Peter Boockvar.
- The “Volcker Rule” is looking more “toothless” by the day.
- US Transportation Secretary Ray LaHood says he wants to talk directly with Toyota’s CEO about vehicle-safety concerns and the company’s handling of those issues.
- AIG”s ignoring its critics and still moving forward with plans to accelerate bonuses to employees of its financial products division.
- Stocks rebound nicely today after rough few weeks, validating research from UBS and JPMorgan, each saying they aren’t worried about the bull market’s sustainability, FT’s Alphaville blog says.
- Amazon gives in to rising e-book prices. But “bear in mind that publishers will actually make less money with the Apple pricing plan,” MediaMemo blogger Peter Kafka says.
- January was a tough month for risky assets as stocks, REITs and commodities all fell substantially while bonds generally held their own, James Picerno notes at The Capital Spectator. Doesn’t mean a new bear market is beginning, but it does show the days of “strong, sustained rallies in everything” are probably over. “The money game now appears destined for a more complicated era.”
- The once-robust charity sector hit with mergers, closings. “Hit by a drop in donations and government funding in the wake of a deep recession, nonprofits—from arts councils to food banks—are undergoing a painful restructuring, including mergers, acquisitions, collaborations, cutbacks and closings,” WSJ says.
- Insider buying picked up a bit last week. but the trend of low levels of buying and continued high selling remains intact, Pragmatic Capitalist says.
- Mark Cuban offers advice on a simple way to create jobs: reduce paperwork. Small businesses and entrepreneurs should spend less time and money on lawyers and accountants and “redirect that intellectual and financial capital to the core competencies of their business,” he says.
- DVD sales are collapsing, nearly as quickly as music sales did over the last decade,” Kafka says. Not good, especially since Hollywood studios are desperately looking for new revenue streams to replace the struggling DVD (hence their big push for a 3-D boom.)
- A $100 million bonus for Goldman Sachs (GS) CEO Lloyd Blankfein? Don’t count on it, Reuters blogger Felix Salmon notes. “It frankly boggles the imagination that he’s going to get anywhere near $100 million,” Salmon says. “Goldman knows that bonuses are a hot-button issue politically, and it’s going to keep them (relatively, by its standards) modest for 2009.”
- Toyota says it’s already begun shipping a fix to the gas pedal problem involved in the recall of millions of vehicles. Time’s John Curran highlights the “Toyota Stimulus.”
- Yahoo (YHOO) and AP reach new licensing agreement; web portal will continue hosting AP articles. “The agreement could help define a core issue facing news organizations: How to deal with the Internet portals that help distribute their material but that some publishers say unfairly profit from their work,” WSJ says.
- From Geithner’s hearing to the FOMC statement and Obama’s State of the Union address tonight, politics seem to be overshadowing fundamentals in the markets these days. “If there ever was a day that encapsulates the new economic world we live in, it is today,” says Miller Tabak’s Peter Boocvkar.
- Recent data from Investor’s Intelligence show a 23% one-week drop in bullish sentiment. “Declining sentiment from high levels tends to be bearish for the market, not bullish,” Jason Goepfert writes at Sentiment’s Edge blog.
- Tablet day – what else can we say. Here’s the Journal’s recap. But one thing Steve Jobs didn’t show off today: much in the way of new media, MediaMemo blogger Peter Kafka says.
- Matt Taibbi weighs in on populism. The man needs no introduction, just go read it.
- “The dollar seems be benefiting from the ever so slightest of hints that the Fed might be prepared to take tiny, baby steps towards tightening,” Grainne McCarthy writes at MarketBeat.
- Toyota dealers say they are trying to operate normally a day after automaker decided to halt sales and production of eight models because of safety concerns.
- At Davos, global business leaders warned Western governments that a populist crackdown on the financial industry could crimp this fragile recovery.
- NYT’s Room For Debate blog has an excellent discussion about Ben Bernanke and whether he should be confirmed for a second term as Fed chairman. Yves Smith says he doesn’t deserve another term after being a “major architect” of the worst crisis since the Great Depression. But Tyler Cowan says it would be a mistake if populist outrage prevented Bernanke from getting confirmed.
Posted by Steven Russolilloon July 02, 2009 Autos /
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We'll be unloading these puppies by the truckload, baby.
Just because the auto industry is calling a bottom in auto sales doesn’t mean a period of robust growth is imminent.
Executives from three of the biggest car makers believe auto sales have bottomed. Toyota says the industry is moving “beyond the bottom,” Ford says auto sector is nearing a turning point and GM thinks the bottom occurred earlier this year.
Mighty bullish words from an industry that saw new-vehicle sales in June drop 28% from a year earlier to 860,000 cars and light trucks, according to Autodata.
It’s possible that automakers could see economic growth resume before other sectors, but don’t count on it, University of California, San Diego economics professor James Hamilton says.
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The bridge that collapsed on Interstate 5 bridge over the Skagit River in Washington was listed as “functionally obsolete” and “fracture critical,” which means the whole sha-bang could come tumbling down if one major part fails. Click here to read the details from USAToday. This sort of thing shouldn’t be happening in a modern, developed nation. Barry LePatn […]
