Rick Newman
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Better Times By Super Bowl XLIV (the one next year)
Continue reading… 1 CommentHere’s an important new economic indicator: The Super Bowl Playboy Party.
This year’s cleavagefest got canceled, just one sad sign of the joyless times we’re living in. Sports Illustrated also canceled its Super Bowl party. NBC has discounted its prices for commercials. Even scalpers are hurting: The going price for a ticket is down $2,000 from last year.
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How Wall Street Continues To Doom Itself
Continue reading… 243 CommentsWe’ve arrived at an ah-ha moment.
Virtually everybody who butters their own bread is outraged that Wall Street, which is becoming a de facto government agency thanks to billions in bailout money, found $18.4 billion in bonuses for bankers who nearly wrecked the world’s financial system in 2008. President Obama’s criticism – “shameful” – is mild compared to what many of us think.
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Ford Veers Closer To a Bailout
Continue reading… 22 CommentsFor a guy not asking for anything, Ford CEO Alan Mulally was awfully agreeable when he came to Washington late last year to testify about a possible auto bailout.
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The Stimulus Plan: 5 Missing Pieces
Continue reading… 264 CommentsStimulate me. Please.
I’m feeling gloomy. And I’m not sure that a Washington plan to fill a bunch of potholes, build some shiny new schools, or construct windmill farms on the Great Plains is going to bounce me out of it.
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Let the Wall St. "Talent" Walk
Continue reading… 168 CommentsHere’s another Wall Street bromide that needs to be retired: The need to pay lavish bonuses to retain the best talent.
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Bottom Hunting: The New Economic Pastime
Continue reading… 8 CommentsWe used to seek deals, steals, and undiscovered treasures. Forget all that. Nowadays, all anybody wants to know is, where’s the bottom?
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Why Falling to No. 2 Is Good for GM
Continue reading… 16 CommentsLast year at this time, the drama was thick among auto analysts as General Motors and Toyota announced their total global sales for 2007. GM had been the world’s biggest automaker for 77 years, but it seemed inevitable that Toyota would bump the fading giant from its perch. When both automakers said they had sold 9.37 million cars in 2007, analysts had to scrutinize decimal points the automakers don’t usually break out. The unsatisfying outcome was the equivalent of a technical knock-out in favor of Toyota.
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Chrysler Needs Another Move, Besides Fiat
Continue reading… 5 CommentsSo now we know why Chrysler executives have been insistent that Chrysler isn’t folding its tent just yet: It turns out there is another automaker interested in teaming up with Detroit’s ailing No. 3 automaker.
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Why Obama's Bailouts Will Look Like Bush's
Continue reading… 28 CommentsThe financial markets didn’t seem to be listening while Barack Obama was kicking off his presidency with a pledge to “begin again the work of remaking America.” As Obama spoke, the share prices of America’s biggest banks were plunging toward 20-year lows. Wizardly prognosticator Nouriel Roubini of New York University said the U.S. banking system is “effectively insolvent.” In Britain, the government advanced a plan to completely take over the Royal Bank of Scotland, which faces 2008 losses of $40 billion or more – a move some think Obama will have to make with regard to some of America’s landmark banks.
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Bush's Last Bailouts, Obama's First Migraine
Continue reading… 12 CommentsThe last days of the Bush/Paulson bailout regime reveal just how tough it's going to be for new President Barack Obama to rescue the right companies - while letting the rest go under.
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The Bright Side of Bank Bailout 3.0
Continue reading… 23 CommentsIt’s infuriating. The U.S. Treasury has spent $350 billion to help stabilize some of the world’s biggest banks – and they’re still teetering.
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Apple Should Disclose What All Its Executives Weigh
Continue reading… 2 CommentsUnder Steve Jobs, Apple has always been one of the most innovative companies in the world. So it’s the perfect candidate for a new corporate reform: the executive weigh-in.
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How Toyota Sees 2009
Continue reading… 6 CommentsHardly anybody wants to predict the future these days, since so many forecasts for 2008 turned out to be dead wrong. But Toyota, with its timely hybrids and steady global growth, is as good as any company at guessing where the economy—and consumer tastes—are headed. Like most other carmakers, Toyota had a dreadful year in 2008, with U.S. sales off 15 percent, only slightly better than the 18 percent drop in the industry overall. I met recently with Jim Lentz, president of Toyota's North American arm, and discussed the outlook for consumers and the U.S. car industry. Excerpts:
It was obviously a terrible year in 2008. And some people think it will be worse in 2009. What does Toyota foresee?
We see three recovery scenarios. There could be a V-shaped recovery that rises very quickly. I think it's doubtful that will take place. What's more likely is a longer, slower recovery, like the Nike swoosh. Or it could be a U-shaped recovery.[Here are the 12 most important cars of 2009.]
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Why There’s Nothing New About This Recession
Continue reading… 19 CommentsThe current recession might seem unprecedented—unless you've studied the myriad booms and busts that have characterized the American economy since colonial days. To ascertain how today's financial seizures compare with others in American history, I spoke recently with John Steele Gordon, author of Empire of Wealth: The Epic History of American Economic Power
and six other financial histories. Excerpts:
We're surrounded, at the moment, by lots of failure in our economy. And a lot of bailouts. But failure is a key part of a free-market economy, right?
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IBM's Stimulus Grab
Continue reading… 8 CommentsIBM CEO Sam Palmisano seems to be upping the ante on Barack Obama. While the incoming president wants to spend more than $700 billion – or is it $800 billion, or $900 billion? - to help create 3 million jobs, Palmisano says he has a plan to create nearly 1 million jobs for a scant $30 billion. Let’s do the math:
Obama cost per job: About $250,000
Palmisano cost per job: About $30,000
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What the Car Companies Want From Obama
Continue reading… 7 CommentsCar buffs and political junkies are two separate breeds, with little overlap between the two. But Detroit has never seemed closer to Washington than at this year’s North American International Auto Show.
Most of the reasons are obvious: The federal government now owns a portion of GM and Chrysler, thanks to $14 billion in emergency loans to help them avert bankruptcy. A federal “car czar” will soon be appointed to oversee those loans and the two companies’ turnaround plans.
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4 Myths From the Detroit Auto Show
Continue reading… 11 CommentsThere's less hype than usual, but it wouldn't be America's s signature car show without a generous helping of hyperbole.
The North American International Auto Show, a January ritual in Detroit, is traditionally awash in "concept cars" and other fanciful experiments that represent automotive wishful thinking. Some eventually get built, while others drift into oblivion as budgets shrink, priorities change, or reality intervenes.
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A Bubbly Outlook From Former Coke CEO Keough
Continue reading… 2 CommentsWhat's happening to capitalism? Are we bastardizing it with bailouts and stimulus plans? Or just giving a nudge where needed? I decided to ask Don Keough, who as CEO of the Coca-Cola Co. from 1981 to 1993 helped create a global powerhouse with one of the world's most recognizable brands. He also presided over the 1985 introduction of New Coke, widely considered one of the biggest gaffes—and quickest recoveries—in business history. Keough is currently chairman of Allen & Co., the New York-based investment bank. He's also the author of The Ten Commandments for Business Failure, a folksy look at what he's learned from a 60-year career in business. Excerpts from our discussion:
Failure is a basic part of a free-market society. We all know that most businesses don't succeed, but many of the most successful entrepreneurs got their start by failing. Yet with all these bailouts and government aid, we don't seem to tolerate failure the same way these days.
I think that's right. Success is a dangerous word because it's not a constant state. Built into success is failure. If you take failure out of the game, there's no such thing as capitalism.
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Why Obama Needs To Be Superman
Continue reading… 16 CommentsBarack Obama better be the unstoppable force. Because his economic plan targets some immovable objects.
I know, I know: Yes we can. Dare to Hope. Don’t succumb to business as usual. Etc. Okay, maybe Obama really will change things that haven’t changed in decades.
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The 12 Most Important Cars of 2009
Continue reading… 32 CommentsIt's going to be one crummy year for the auto industry. General Motors and Chrysler are struggling just to survive, and many of their competitors are losing money. Sales in 2009 are likely to be even lower than in 2008—which itself was one of the worst years in decades. Hundreds of dealers will probably go out of business, and weak brands like Saturn, Mercury, and Dodge could shrink dramatically or end up rolled into other divisions.
Yet the tough economy could make 2009 a watershed year for cars. With buyers scarce, slow-selling models—often relegated to rental fleets—could disappear completely. A new spate of hybrids will test whether large numbers of Americans really want to pay extra money upfront to save a few bucks at the pump. Lower gas prices might give SUVs a reprieve. And a few game-changing vehicles could offer consumers even more choices—while forcing other manufacturers to catch up or become obsolete.
[See how the feds will govern GM and Chrysler.]
Here are some of the most significant vehicles to keep an eye on over the next 12 months:
