Already a Bloomberg.com user?
Sign in with the same account.
This One May Go to the ConventionIt was do or die, and Hillary Clinton did. Even former President Bill Clinton said his wife might have to win both Ohio and Texas on Mar. 4 to stay in the hunt for the nomination, setting up a dramatic night that ended with Senator Clinton under a hail of confetti in Ohio, having won those two plus Rhode Island. Senator Barack Obama claimed Vermont and maintained a lead among pledged delegates. On the same night, Senator John McCain sewed up the Republican race. Next up: primaries in Wyoming on Mar. 9 and Mississippi on Mar. 11, and a biggie for the Democrats in Pennsylvania on Apr. 22.
See "Dem Contenders Work the Web"Crazy for CommoditiesThink oil is sky-high? Take a gander at some other commodities. Gold, platinum, corn—they're all pushing past peak levels. The culprits: a plunging dollar and robust growth outside the U.S. Oil traded at $103.95 a barrel on Mar. 3, beating an inflation-adjusted record set back in 1980, as the greenback slipped to a new low against the euro of nearly $1.53. Even as commodities later backed off a bit, finger-pointing began. An Energy Dept. official oddly echoed OPEC officials who blamed speculators for driving up oil prices. But Goldman Sachs (GS) insisted in a report that "long-term structural supply issues" are the main driver.Ben the JawbonerFed Chairman Ben Bernanke on Mar. 4 turned up the rhetorical heat on home lenders and the Bush Administration to do more about the foreclosure crisis. He told lenders "more can and should be done" to reduce how much homeowners owe and said the Federal Housing Administration should help more people refinance at affordable terms. Meanwhile, mortgage buyers Fannie Mae (FNM) and Freddie Mac (FRE) unveiled an accord with New York Attorney General Andrew Cuomo to crack down on phony or self-serving appraisals.Drugs to Make You ThinAn obesity therapy is the Holy Grail of the pharma industry, and a new crop of antifat medicines is making its way to the FDA. Merck (MRK) expects to release data on its obesity treatment in late March and file for approval by the end of the year. Close behind are a coterie of competitors large and small, including Pfizer (PFE), Amylin (AMLN), and Vivus (VVUS). But ensuring safety will be a supersize challenge, considering the legacy of obesity drugs' scary side effects.No Rest for CitiCrunched by the credit crunch, Citigroup has already raised $30 billion. On Mar. 4, Citi stock sank to its lowest level in nine years after Sameer Al Ansari, CEO of Dubai International Capital, said Citi will need to hunt for more cash. Citi chief Vikram Pandit pooh-poohed that in a memo the next day, saying "Citi is financially sound." Still, one Merrill Lynch (MER) analyst predicts an $18 billion hit to Citi's balance sheet this quarter.
See "What's the Matter with Citi?"Thornburg on the BrinkThornburg Mortgage (TMA) is having its worst week ever. The struggling jumbo-loan outfit admitted on Monday, and then again Wednesday, that it couldn't meet margin calls made by other financial institutions. So goes the violent cycle of forced liquidations in this credit crisis. Now in default under several "material" lending agreements, Thornburg desperately needs a lifeline. Traders slashed its shares to 2. They were worth 9 just last week and 28 last June.Snarled in DetroitIf you can't get key parts, you can't make cars—so General Motors (GM) stocks of pickups and SUVs could dwindle in coming weeks if the United Auto Workers stay on strike at supplier American Axle (AXL). As of Mar. 5, GM had shuttered seven plants. Chrysler, too, had to idle production of its industry-leading minivan because of a strike at TRW (TRW) by the Canadian Auto Workers. The unions are seething at what they feel are excessive proposed salary and benefit cuts. All this at a time when sales could hit a 15-year low: Chrysler's February sales slid 17% from the year earlier, GM's 16%, Ford's 10%, and Toyota's (TM) 7%. GM on Mar. 4 boosted Frederick "Fritz" Henderson from CFO to president and COO, putting him in line to succeed CEO Rick Wagoner.
See "Car Sales Slip Off the Road"Hyundai Hits a BumpIs Hyundai's top-down style holding it back in America? That's what some current and former executives think, and many analysts agree. Hyundai Motor America has cycled through four top executives in five years. And Kia Motors America, controlled by Hyundai, recently fired its top two U.S. managers—the fourth shakeup in three years. Meantime, Hyundai and Kia's rapid sales growth in the U.S. has crested, and one reason may be the lack of consistent leadership amidst a tough market.Moguls DeniedFallen media titans Conrad Black and John Rigas both lost bids for get-out-of-jail cards. Former Hollinger International Chairman Black reported to a Florida prison on Mar. 3 to begin serving a sentence of 6 1/2 years after a federal appeals court rebuffed his plea to remain free while he appeals his 2007 conviction for fraud and obstruction of justice. That same day, the Supreme Court rejected a final effort by Adelphia Communications founder Rigas to overturn his 2004 accounting-fraud conviction. That means the 83-year-old must continue serving his 15-year term.New Face at FacebookFor the past year, hot social network Facebook has been stealing attention from Google. (GOOG) Now it has stolen a top Google executive. Sheryl Sandberg, the search giant's vice-president for global online sales, will join Facebook as COO on Mar. 24, reporting to CEO Mark Zuckerberg. Facebook's bids to create a richer ad business based on connections between its 66 million users have drawn barbs from critics citing privacy worries.A Blow to BoeingHardly anyone expected the U.S. Air Force to clip Boeing's (BA) wings by awarding Northrop Grumman (NOC) and partner European Aeronautic Defence & Space a $35 billion contract for tanker planes. The Feb. 29 announcement, which calls for EADS's French subsidiary Airbus to build 179 jets for aerial refueling, stunned Boeing and sparked outrage on Capitol Hill that a foreign company would be handed part of such a rich prize. Boeing says it won't decide whether to appeal until after a Mar. 6 briefing with Air Force officials.
See "Tanker Deal: Why Boeing Shouldn't Protest"Yahoo's ManeuversWith the clock ticking on Microsoft's (MSFT) bid, Yahoo (YHOO) is looking to buy time. The board of directors on Mar. 5 extended the period in which Microsoft could nominate a slate to replace them. Microsoft formerly had until Mar. 14 but now has until 10 days after the company notifies shareholders of its annual meeting. Meanwhile, The New York Times said on Mar. 5 that Yahoo is stepping up talks with Time Warner (TWX), but that's seen as a ploy to get Microsoft to beef up its offer, now worth $42 billion.Diebold's SuitorTwo years of quiet persuasion availed nothing, so United Technologies (UTX) is going hostile. On Mar. 4, UTC bid $40 a share, or nearly $3 billion, for ATM maker Diebold (DBD), which hasn't filed an earnings report since the first quarter of 2007. The stock quickly jumped from 24.12 into the high 30s. Despite the 66% premium, Diebold spurned the proposal.Fidelity SettlesOn Mar. 5, Fidelity Investments agreed to an $8 million settlement to end a lengthy federal investigation. The SEC says Fidelity traders failed to obtain the lowest prices for trades, favoring brokers who'd lavished them with goodies such as tickets to the Super Bowl. Fidelity neither admitted nor denied wrongdoing. Legendary fund manager Peter Lynch will pay $15,948 without admitting wrongdoing for accepting 61 tickets to events.Eco-Arsonists?Apparently, even if you build big homes with "green" technology, it won't satisfy some radical environmentalists. Arsonists torched five homes north of Seattle, destroying three of them and doing an estimated $7 million in damage. A sign left at the scene ridiculed the green claims of the builders and bore the initials of the Earth Liberation Front, which has allegedly carried out several attacks, including arson, on organizations it deems harmful to the environment.E*Trade's New BossDonald Layton, once bruited as a contender for the corner office at JPMorgan (JPM), is laboring to stabilize E*Trade Financial (ETFC). He was named on Mar. 4 as CEO of the online brokerage, which is hobbled by $12 billion in troubled home equity loans. Layton, who has served as chairman since November, told the Associated Press he has no plans to sell or break up the firm. E*Trade got a $2.55 billion infusion from hedge fund Citadel in November.Roadblocks in ChinaThe Middle Kingdom is losing its allure as a manufacturing hub. At least, so say 54% of respondents to a survey of mostly international companies carried out by the American Chamber of Commerce in Shanghai and consultants Booz Allen Hamilton. Those polled cited the stronger yuan, inflation, rising wages, and employee churn as factors dimming the nation's attractiveness. Nearly one in five of the companies surveyed plans to shift some production elsewhere, with Vietnam and India at the top of the list. (amcham-shanghai.org)The Age of AquariaWith its lavish beaches and bountiful sun, Israel's southernmost city, Eliat, has long been a magnet for tourists. Now a group of Jewish investors from the U.S. is looking to turn the seaside resort into an entertainment destination along the lines of Disney World, reports the Feb. 21-Mar. 6 issue of BusinessWeek Israel. The partners are plowing $300 million into Aquaria, which will include a theme park complete with erupting volcanoes, an Amazon rain forest, and a prehistoric zoo. Yet more than five years into the project, the group has still not won the permits it needs to begin construction.