Tuesday, November 10, 2009

Tuesday Morning

After a quick head fake south, US stocks are up again, adding to yesterday's 204 point gain for the DJIA, putting the index at 12month highs.

Under the banner of increasing Federal Reserve transparency, Congressman Ron Paul has sponsored a bill that would subject the Fed's monetary policies to an audit by the Government Accountability Office (GAO). The bill is a veiled attempt to undermine the Fed's independence. If it passes, it will cripple policy making—particularly when it comes to inflation. It is completely appropriate to hold the Fed accountable for its decisions. But the Paul bill, H.R. 1207, will only produce redundancies: Congress already has multiple ways of finding out what the Fed is doing and why.

Yahoo (YHOO) CEO Carol Bartz is in Singapore today. Calling their current margins unacceptable, she promises to treble(fancy word!) them within three years.
"Six percent operating margin is terrible, terrible... We have a commitment that it will be 15-20 percent in the next three years," she said at a lunch talk organized by the American Chamber of Commerce in Singapore.

Even hotels are accepting the "non-travel" business, installing Cisco Telepresence suites:
“If you can’t beat ’em, join ’em,” may be the best maxim to explain why travel companies are getting into the virtual meeting business, actually helping clients avoid flying halfway around the globe. Two of the world’s biggest hotel companies, Starwood Hotels and Resorts and Marriott International, are outfitting some of their meeting rooms with telepresence suites, a high-end system that leapfrogs typical videoconferencing technology.

Whoops. The FDIC's "merit program" reduced the time spent on examining supposed "good banks" so they could focus on weaker firms. It didn't work.
“The program was misconceived from the beginning,” said Colleen Kelley, president of the National Treasury Employees Union, which represents the examiners. “Employees believed the procedures were directed more at reducing examination hours than at ensuring proper supervision.”

Monsanto(MON) is fighting to regain market share from Dupont(DD), something they haven't had to do in a decade.
DuPont, the second-biggest seed maker, grabbed U.S. sales from Monsanto this year, showing its larger rival that farmers won’t always pay for the most advanced seeds. Monsanto aims to regain market share with corn that contains eight genetic changes and the first update of its herbicide-resistant soybeans in 13 years. Monsanto Chief Executive Officer Hugh Grant is counting on the new soy and corn varieties to add $1 billion to profit by 2012. A survey of growers from early in the harvest now underway indicates the seeds aren’t meeting yield expectations, contributing to an 11 percent decline in Monsanto’s shares the week the results were circulated.

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