Losses Push Lehman To Weigh Raising New Capital (WSJ)
Lehman is expected to report losses in a couple weeks, and WSJ reports that in conjunction with this, the company may announce a raise of $3-$4 billion. From this timing, the report surmises that the loss will be worse than expected. Previously, analysts had expected a loss of around $300 million. The new round of capital raising will likely further dilute existing shareholders. It seems unlikely that Lehman could justify this kind of massive dilution, coming on top of $6 billion raised in prior quarters, unless it faced serious balance sheet challenges. How will Lehman justify several months of optimistic talk about its performance? Once again the bearish analysts and the shorts seem to have known more about the earnings of an investment bank than its own management.
Grasso's Grit May Win After All (NYT)
Wait, the Grasso pay package case? This nonsense isn't over yet. What's next, are you going to tell me there's still some Enron-related stuff in the courts? Of course not. Oh Wait! Anyway, back to Grasso. With Spitzer gone and the whole story kinda faded from memory, Grasso doesn't have all kinds of negative headlines to deal with.
Soros Says Sell (Infectious Greed)
Just a heads up (mainly to the daytrime crew at The 'Breaker). Soros is apparently testifying today in front of the Senate, where he will argue on the "oil is a bubble" side of things. FT has more on what he'll be saying, including his argument that investing in energy via index funds is a problem. Gosh, would love the irony if lawmakers commenced a war on index funds.
Ryanair prepares to raise prices (FT)
Ryanair, popular among frugal travelers and airplane nerds will be forced to raise prices to cope with rising oil prices. After turning in record profits last year, the company's earnings will plunge to "only" break-even this year, which a lot of other airlines would be really jealous of. In addition to the fare hikes, there's also a company-wide pay freeze. While we're big fans of Ryanair (in theory), and its aggressive approach to capitalism and competition, we're not entirely convinced by it. For all the free-market rhetoric, the company has been accused of taking subsidies from the small airports it serves (that issue may have been resolved at this point, though last we heard, the charge made a lot of sense).
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment