I'm not a knee-jerk hater of the Obama administration.
But the President's decision to reject the Keystone pipeline was one of his worst.
Archives for February 2012
February 2012 - Page 9 of 11 - Money Morning - Only the News You Can Profit From
Anadarko Petroleum Corp. (NYSE: APC) Ready to Rebound After Oil Spill Losses
Anadarko Petroleum Corp. (NYSE: APC) reported after market close today (Monday) a fourth-quarter profit loss, due to a $4 billion pay out made last quarter related to the BP PlC (NYSE ADR: BP) oil spill in 2010.
Anadarko, the largest U.S. independent oil and gas company by market value, reported a $358 million, or 72 cents per share, loss for the quarter. Revenue rose 42.7% to $3.84 billion from the year earlier quarter.
Excluding the spill-related payout and other items, Anadarko earned 85 cents a share. Wall Street expected the company to book earnings of 60 cents a share, more than doubling the 29 cents earned in 2010's last quarter.
Now with its legal battles behind it, the company is ready to take off as higher oil prices and a recent discovery drive future earnings.
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China Will Keep Driving Yum Brands Inc. (NYSE: YUM) to New Highs
Yum! Brands Inc. (NYSE: YUM) today (Monday) reported fourth-quarter earnings that beat The Street, highlighting the impact a strong emerging market presence can have on soaring profits.
The quick-service restaurant business that owns KFC, Taco Bell and Pizza Hut chains saw quarterly profit rise 34% to 75 cents a share. Revenue for the quarter climbed 15% to $4.11 billion.
Yum's results beat Wall Street's expectations of 74 cents a share and a 13.1% revenue increase to $4.03 billion.
The yearly earnings per share increase of 14% marked the tenth consecutive year of EPS growth of 13% or more. Monday's earnings report shook off speculation that slowing Chinese growth could hurt Yum in 2011.
In fact, its outlook is as bright as ever.
Yum Brands Inc. (NYSE: YUM): Feeding China
Strong sales in China – Yum's major revenue driver – offset the struggling U.S. business. While full-year same-store sales fell 1% in the United States, same-store sales rose 19% in China.
China's quick-service restaurant industry is expected to grow around 15% this year – almost double China's gross domestic product (GDP) growth, which is only expected to jump 8.4%. The growth outlook means other restaurants will try to cut into Yum's market share and appeal to the country's growing middle class.
"KFC and McDonald's are growing outlet numbers, but so are domestic and foreign chains plus independents," Paul French, Mintel's chief China analyst, told Reuters. "The pie is bigger, but the number of players wanting and getting a slice of it are bigger too. A rising tide does not necessarily raise all boats."
Still, Yum's strong position in the region has readied it to beat competitors. Yum was one of the first U.S. quick-service restaurant businesses to successfully profit in China. It opened its first fried-chicken outlet in the region in 1987 and now has more than 4,200 total restaurants, compared to McDonald's Corp.'s (NYSE: MCD) 1,400 stores.
Yum! Brands expects China to lead the company to 10% total sales growth in 2012.
Emerging markets contributed to 50% of Yum's operating profit in 2011, and should account for a bigger portion this year. Yum! Brands plans to open another 600 new stores in China alone, after opening a record 656 in 2011.
Now Yum is diversifying its market presence. It announced Jan. 6 that shareholders of China's leading hot pot chain, Little Sheep Group Ltd., approved a takeover by Yum. Little Sheep operates about 3,000 restaurants in China, with annual revenue of $315 million.
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Are Federal Reserve Presidents Gaming the System?
The presidents of the U.S. Federal Reserve may not have used their knowledge for personal gain, but a look at their assets does show several apparent conflicts of interests. More than 600 pages of disclosure documents were released last week after Bloomberg News filed a Freedom of Information Act request. The most troubling revelation concerned […]
Jobs in America: The Ugly Truth Behind Those Unemployment Numbers
More people have jobs in America this month than they did last month, so says the U.S. Bureau of Labor Statistics (BLS). But the headline unemployment rate of 8.3% isn't the whole story. It's not that there wasn't positive news. The addition of 243,000 new jobs far exceeded economists' expectations for an increase of 150,000. […]
Bankers Committed Fraud to Get Bigger Bonuses
In case you didn't catch the article titled "Guilty Pleas Hit the 'Mark'" in the Wall Street Journal, I'm here to make sure you don't miss it.
This is too good.
Three former employees of Credit Suisse Group AG (NYSE: CS) were charged with conspiracy to falsify books and records and wire fraud. They were accused of mismarking prices on bonds in their trading books by soliciting trumped-up prices for their withering securities from friends in the business.
By posting higher "marks" for their bonds in late 2007, they earned big year-end bonuses.
What a shock!
What's not a shock is that, after a bang-up 2007, Credit Suisse had to take a $2.85 billion write-down in the first quarter of 2008. No one knows how much of that loss was attributable to the three co-conspirators who were fired over their "wrongdoing."
Two of the three accused pled guilty. Also not shocking is the reason David Higgs – one who pled guilty – gave for his actions. He said he did it "to remain in good favor" with bosses, who determined his bonus and who profited handsomely themselves from his profitable trading and inventory marks.
As for Salmaan Siddiqui, the other trader who pleaded guilty? His attorney Ira Sorkin, the former Securities and Exchange Commission (SEC) enforcement chief, said of his client: "What he did was the result of his boss and his boss' boss directing him to do it."
You know what else is shocking?
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The Hunt for Higher Yield: Investors Pour into Emerging Market Debt
The never-ending hunt for higher yield is leading investors to bet record amounts on emerging market debt.
In just the first two weeks of 2012, governments of undeveloped economies from Asia to Africa sold more than $30.6 billion in dollar-denominated bonds according to Bloomberg News.
That's up from roughly $19.9 billion in the same period last year and the most since 1999, when Bloomberg began collecting data.
Typically, investors shun emerging market bonds during times of uncertainty in favor of "safer" assets like gold and U.S. Treasuries.
But that has started to change.
The Big Move Into Emerging Market Debt
In fact, investor demand is overwhelming supplies as orders have outstripped the amount of bonds being sold.
During a recent auction, the Philippines received $12.5 billion of orders for $1.5 billion of 25-year bonds, pushing the yield down to a record-low 5%. Indonesia sold 30-year bonds at a record-low yield of 5.375% and Colombia sold $1.5 billion of 29-year bonds at 4.964%.
Analysts say the debt crisis in Europe, along with record low yields on U.S Treasuries, has investors on the hunt.
They are now buying the debt of undeveloped nations like Indonesia, Mexico and Brazil, even though credit-rating firms rank them as more risky than their European counterparts
"What we're seeing is a re-evaluation of sovereign-credit risk, increasingly being driven more by fundamentals than by classifications," Eric Stein, a portfolio manager at Eaton Vance Corp. (NYSE: EV) told The Wall Street Journal.
According to the J.P. Morgan Emerging Markets Bond Index, investment-grade sovereign emerging-market bonds are yielding an average of 4.7%.
By contrast, Italian 30-year debt yields 7%, while Spanish 30-year debt yields 6.1%.
One reason emerging market bonds are attracting interest is…
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This New Spy Technology Could Be Worth Billions
Using GPS to track a risky teenage driver or a cheating spouse is about to become old hat.
You see, we are actually on the verge of a revolution that will allow us to locate and track every physical object made in the world.
Not to mention literally every person on planet Earth.
And best of all, this new technology can be used to solve a wide range of problems.
From checking on patients at home, to finding stolen cars, to locating soldiers lost from their units, the possibilities are endless.
Then again, as privacy advocates are quick to point out, there is also the potential for abuse.
Consider this: In the near future, Big Brother will even be able to track your clothing. It's right out of "1984."
That's why I believe the Supreme Court's recent ruling that curbs police use of GPS trackers is a big win for citizens and high-tech investors.
That's because the high court used a broad brush that will give police units pause before they abuse the new tracking technology.
We need these broad safeguards for one simple reason: In the Era of Radical Change, the pace of breakthroughs is so fast that no court or government agency can hope to keep up.
Welcome to the Surveillance Society
In that regard the Supreme Court's timing is right on the money.
The Federal Aviation Administration (FAA) is set to approve new, small helicopter "spy" drones for local police to use in cities.
In fact, AeroVironment Inc. (Nasdaq: AVAV) has a new device especially tailored for law enforcement. The mini-copter weighs just 5.5 pounds and fits in a car trunk.
It costs about $40,000, roughly the price of a police cruiser. But the drone is often much better than a car at tracking suspects.
Big energy also has shown interest in these new drones. They work well for checking on remote assets like oil rigs and pipelines.
I also recently told you about AeroVironment's new hummingbird-sized spy drone. I predict that in a few short years, the scale of these robots will shrink to the size of a fly.
Believe it or not, there is even "talking" underwear courtesy of the Pentagon.
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Romney Avoids Nevada's Housing Market Problems with a Tactic That Could Work - for Now
Mitt Romney is expected to take Nevada by a large margin this weekend – even though he joined fellow candidates in failing to address the staggering number of foreclosures plaguing Nevada's housing market. A poll released early Friday gave Romney a 20-point lead over former Speaker of the House Newt Gingrich. But Romney's win would […]
Insider Trading Ban: Congress Really Wants You to Like Them
In an attempt to end plunging approval ratings – and win favor in an election year – the Senate passed an insider trading ban yesterday (Thursday) preventing Congress members from profiting from non-public information.
The Senate passed the bill in a 96-3 vote. U.S. Rep. Eric Cantor, R-VA, said the House would consider the bill next week. U.S. President Barack Obama pledged to sign it immediately.
Congress members hope the new law will change growing American disgust with Congressional perks and partisanship, which has hammered approval ratings down to the teens.
"The numbers of people who have a favorable impression of this body are so low that we're down to close relatives and paid staff. And I'm not so sure about the paid staff," Sen. Joe Lieberman, I-CT, said earlier this week.
Insider Trading Ban Run Down
The insider trading ban prevents members of Congress, top aides, and administrative officials from using non-public information when trading. Any stock bought or sold must be disclosed in a public report online within 30 days.
Several last-minute amendments added to the insider trading ban include:
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