AOL's recently appointed chief executive, Tim Armstrong, has only been in place for three weeks but Wall Street is waiting impatiently for his next move. He's started to shake up the ad team. Investors are focused on when parent company Time Warner will spin off the Internet unit, which has lost favor with Wall Street, advertisers and users alike.

Armstrong, gave his first interview since starting on April 1 to Ad Age Editor Jonah Bloom at the 4A's advertising conference in San Francisco. Though he has declined doing interviews since he joined, AOL's communications people said Armstrong was keeping a commitment he'd made while he still at Google.

The three-part interview can be seen at Ad Age here. The fireside chat covered topics like AOL's branding, AOL's undervalued ad space, and how Armstrong had to leave Google by the tradesman's entrance on his last day.

Asked whether AOL's standalone valuation could once again be worth $20 billion, which it theoretically was until Google wrote down its 5 percent stake in AOL to effectively give it a value of $5.5 billion in January, Armstrong said:

5.5 (billion) in my book is still a lot of money...I've said internally to employees Wall Street cares about you, and Main Street cares about you, and until we get Main Street caring about our company everyday (and) every time they touch the product and service, the valuation doesn't matter because the worst case possible, the thing that happens at Internet companies is, you see, it is that people vote with their clicks and over time unique users go down.

At AOL, one of the things we're focused on right now is how do you actually turn the unique users around and go in the right direction. More than valuation, more than anything else, if people are voting with clicks about our products and services, that will mean a lot more in the future of the company than the valuation.

Of course, Armstrong recognizes $5.5 billion is a lot of money because many Wall Street analysts now value AOL at between $2 billion to $3.5 billion. The analysts base their valuations on estimates of the terminally declining discounted cash flows from its dial-up business, along with estimates of cash flow from the struggling online advertising sales.

Collins Stewart's Thomas Eagan says based on Wall Street's average Time Warner valuation, AOL is even lower than that.

With recent events, we believe a transaction that will better monetize TWX’s value in AOL is approaching. That said, we continue to believe that the Street’s value of AOL, implied by the value of Time Warner stock, is too low. We estimate that the Street values AOL at approximately $1.6bn, less than half of its real value.

We're sure Armstrong, who was brought in by Time Warner chief Jeff Bewkes to oversee the likely spinning off of AOL, will agree his company is undervalued.

(Photo: Reuters)

The Federal Reserve role as a lender of last resort has never been more prominent than in the current crisis. But Martin Shubik, economics professor at Yale, argues in a policy note that the country might also need another kind of economic body: A Federal Employment Reserve Authority, or FERA, to stabilize labor markets in troubled times.

"In order to keep a socially acceptable index of unemployment below some specified level, a government agency similar in power and structure to the Fed would be appropriate," Shubik writes in a research note published by the Levy Economics Institute.

The proposed agency would not in itself create jobs, but it would have the expertise to evaluate projects for their viability, keeping handy a list of so-called "shovel-ready" public works projects that would be easily implemented and yield the most bang for the taxpayer's buck.

"FERA would require considerable hand-tailoring to provide the appropriate control details needed. But as a permanent body it would be a vast improvement over a last-minute, temporary disaster-relief program such as the Depression-era Works Progress Administration (WPA)," Shubik writes.

Shubik's proposal may sound like a pipe dream, but with the economy losing upwards of 600,000 jobs a month it is not difficult to envision a day when the notion of a central employment agency begins to gain political traction.

Three hours of running from pillars holding up tin sheets to police posts, which provided security cover to shacks that had cropped up as polling booths, made me realise how frustrating the whole process is when the world's largest democracy goes to vote.

It's been more than two years since I moved to Mumbai and, frankly, voting was never top of my family's agenda.

But, it all changed post the November 26, 2008 Mumbai terror attacks. Although we skipped the candles and the drama outside the Gateway of India near the Taj, which saw a protracted gun battle between armed militants and Indian security forces, one cannot deny the impact the attacks had on our collective conscience.

My wife said we cannot just sit back and accept whatever that happened as part of the new reality - terror can strike anywhere, anytime.

For her, it was the "jaagore" moment. For me, after doing my bit of reporting and producing news on India and South Asia for around 10 years, including an overnight vigil outside the Taj Mahal hotel till the miltants were finally eliminated, it was more like "we'll see."

My wife said we need to register our names and, if nothing else, at least vote in the elections. As a citizen in a what many call a dysfunctional democracy, she felt that's the least one can do. For me, that meant "work". I realised my cynicism will be put to the ultimate test.

This time around, my wife was willing to do all the work. Hail Activism!

She logged on to jaagore.com, registered our names, kept herself constantly updated on the progress of our application and had become quite an expert on voters' rights, at times embarrassing me with her level of awareness.

But, there's only as much jaagore could do. We were first time voters in Mumbai and things unravelled.

The Electoral Registrar's Office said the onus was on us to prove that our names were not on any other voters' lists. This came as a bit of a shock and surprise as the voter registration form also allowed us to submit that all other existing registrations, anywhere in India, may be cancelled.

We should have known that such a facility would have to be backed by technological support from a central database of eligible voters where the authroities could monitor and track migration of voters within the country. Maybe, Govt of India and the Election Commission will embrace technology before the next general elections, hopefully not before 2014. By then, we should have the option of voting via SMS or even over the Internet.

Back on dharti Mumbai, reality had bared its fangs.

The officer said we'll need to file an affidavit, duly notarised, stating that "as far as we are aware, our names does not exist in any other voter list anywhere in India". After spending a thousand rupees and half a day in a Mumbai court, amid lawyers in black coats that reminded me of my failed attempt to become a legal eagle, I did wonder - How will this "notary public" know if I'm telling the truth at all?

Till the last day, our names never showed up on the voters list. Neither did any of the parties or their candidates come to us seeking votes, as is the case in smaller towns like Thiruvananthapuram and Jhansi where we grew up.

On election day, April 30, 2009, we decided to give it a shot by going directly to the polling booth. We saw that a large open space in front of our house had been converted over the past one week into a polling station with multiple booths made of tin and plastic sheets and bamboo poles.

After spending about an hour there, we figured out our names were not in the voters list at that polling station. The kind policemen on duty directed us to another polling station which was about half a kilometre away. There too, the result was the same.

I realised even the party polling agents didn't have a comprehensive list. Trust me, if even one of them had helped me, I would've voted for their party candidate. I knew there was a voter helpline that was advertised. But, you can call it only from an MTNL line.

For us, it was a race against time. We'd left our two-year-old son sleeping at home, with our Man Friday keeping vigil, and the 5 PM deadline for polling to end was fast approaching. We scooted around in taxis to two more polling stations in Wadala area before finally zeroing in on one polling station, this time in a govt school near the Wadala Fire Station. I was all fired up.

As we stood in line waiting for our chance, we scanned the list of candidates put up outside the booth. The customary party symbols were all there - hand, elephant, lantern, bow and arrow etc etc. I felt awkward. The symbols were familiar, but we didn't know any of the candidates.

For her part, my wife had already decided. But, I was not so sure. Some of the parties I'd voted for in the past did not even bother to field their candidates in my constituency. But the bigger trepidation was whether I'll get to vote this time.

Once inside, we found the first trace of efficiency in three hours and the polling officer there promptly helped us with our registration numbers. After my wife voted, it was my turn and the same symbols started smiling invitingly from the Electronic Voting Machine (EVM). I realised it's a marvellous piece of engineering and decided to cast my vote in favour of Rohan Gawru Tambe, an independent candidate. His symbol "pressure cooker" swung it for me.

I felt it was apt given that I was steaming in the sweltering heat and grime. It was indeed a pressure cooker situation as I managed to get the blot on my middle finger at 4.55 PM. I'd joined the august company of Bollywood A-listers and Mumbai industrialists who voted in the third stage of this mammoth electoral process, although early reports suggest the turnout in this bustling city of dreams was barely 40 percent. It has surprised some that all the activism post-26/11 did not translate into votes.

Columnist Vir Sanghvi summed up the disconnect quoting MJ Akbar who'd famously said in 1984 "Bombay has a chance to establish diplomatic relations with the rest of India". Sanghvi said Mumbai failed then, and have failed yet again.

But, we were excited that we got the chance and had to scurry back since our child was waiting. On to our fourth taxi and I asked the driver if he voted. He said "vote se zyaada zaroori mera pet hai" which translates to something like "my stomach is more important than the vote".

I did suggest there were worthy candidates like my man, Tambe. But, the taxi driver's priorities were clear. He couldn't care less about who stood and who won. I realised he shared an apathy which was similar to mine, but his was fashioned by a need to survive. 

On our way back, we went past voters, some proud of their participation, others convinced of their candidates' chances. It was indeed the dance of democracy.

Once we reached home, my wife showed me a notice on the bulletin board. There was a blood donation camp in our housing society. Wonder if I should have gone there instead?

The Pakistan Army is fighting to regain control of the Buner valley to stop a Taliban advance deeper into the heartland, a battle that could determine the course of action the United States adopts in the near future.

Two weeks is what U.S. Central Command chief General David Petraeus is giving the Pakistani establishment to destroy the Taliban in Buner, some 60 miles from Islamabad, and begin to reverse the tide in the rest of the northwest region, according to Fox News.

It quoted Petraeus as saying that the Pakistanis had "run out of excuses" and were finally serious about combating the threat from the Taliban and al Qaeda. But because of a history of offensives that were not carried to their conclusion and even ended up in a reversal of positions, the U.S.military had suspended judgment. It would wait to see concrete action by the government to finish off the Taliban who remained in control of parts of Buner.

U.S. President Barack Obama was a bit more positive, although he made clear at his news conference in Washington that he remained "gravely concerned" about Pakistan.

Obama said the Pakistani military had begun to realise the biggest threat to the country's stability came from militants operating within, not old rival India. "On the military side, you're starting to see some recognition just in the last few days that the obsession with India as the mortal threat to Pakistan has been misguided, and that their biggest threat right now comes internally," Obama told a news conference in Washington.

Has there been a shift? If it has, it could certainly be of far-reaching consequence. The New York Times reported earlier this week that Pakistan had moved 6,000 troops from the eastern border with India to fight militants on its western flank along the border with Afghanistan.  These were troops that had been deployed in the east after tensions rose following the attacks in Mumbai in November which New Delhi blamed on Pakistani-based guerrillas.

Moving six thousand troops from an army of hundreds of thousands is hardly a tectonic shift in posture that remains India-focused, but at least it is a start, said  Fareed Zakaria on CNN.

And these are not just voices from abroad, which are clearly beginning to border on the hystrerical. Pakistan's Dawn says the army shouldn't stop at Buner, or Lower Dir, another area that it won back last weekend. It must go into the Swat region which it said was the "epicentre of militancy" and where the militants have shown little willingness to stick to a peace deal even after the administration agreed to their demand for sharia law.

[Reuters photos: Generals Petraeus and Kayani; refugees from Buner]

He may have lost the race to become the "American Idol" but Matt Giraud says he couldn't have wished for a better way to go out of the TV singing competition than with his rendition of "My Funny Valentine" in jazz week.

"Going out with Simon (Cowell) calling you brilliant and comparing you to Nat King Cole is pretty much the best way you could go...I was at complete peace with myself, " Giraud, 23, told reporters on Thursday after being voted off the show .

The dueling piano player said that being saved by the judges from elimination two weeks ago under the new "judges save" rule introduced this year, was something he will always remember.

"I've never felt so much love in the room. It was one of the coolest moments of my life...I really didn't know that people felt that passionately about me," he said.

Giraud had some advice for other "Idol" wannabes that echoes the weekly refrain from the judges -- song choice. "There are a million songs that you love and they move you. But picking a song that you sing well is the hard part. Picking the song that is good for you is a different part," he said.

But would things have turned out differently for Matt if he had picked another jazz standard?  "I've listened back to it and I wouldn't change a thing...I'm proud of what I did," he said.

While you might hate pimples, apparently they're kind of a beautiful little thing over at Procter & Gamble.
 
Wella hair care is one of those businesses that fits into a broad portfolio of everything from Pampers diapers to Tide detergent.  Right?  Still, it's just a little bit different enough to make some wonder why P&G has held onto it.  It's not like Wella brand products are filling up shelves at Wal-Mart like Clairol products are.

On Thursday, CEO A.G. Lafley was asked about Wella and Braun (the appliance business which, again, isn't a clear match with some other P&G products). 
 
Lafley admitted that P&G put some Wella restructuring "on the back burner" while it was busy digesting Gillette.
 
"We're going to get it restructured this year and next," Lafley said during the company's quarterly earnings call.
 
He said he likes Wella, especially because innovation at the high-end salon business trickles down.
 
"Is it worth investing for two or three years? Heck, yes because a lot of innovation and a lot of ideas come out of salons and then go into retail and we want to be on the cutting edge of that."
 
Still, it's not the brand that's going to drive major growth.
 
"Will Wella make the difference in the company's financial results?  It's a pimple.  Now, I hope it will become more, but right now it's not going to make a big difference," Lafley added. 

(with reporting by Ben Klayman)
(Reuters photo of A.G. Lafley)

Who’s Who of Financial Bloggers

Fiji water's invite-mockery marketing strategy: Justin Fox on the age-old question of how and why Fiji Water exists as a product. I have another question, though: why is domestic sparkling water so hard to find?

Mighty Financier Ackman Defers to Mother-in-Law, Lists Majestic Co-op for $10 M.; Wanted $12 M: Check out the acid-green bedroom!

The Federal Reserve should not interpret signs of moderation in the U.S. recession as a reason to stop its emergency measures to heal the economy and financial markets, according to Payden & Rygel economist Thomas Higgins.

"An often overlooked danger is that policymakers may cut back on monetary and  fiscal stimulus too soon. This is what happened in Japan in the mid-1990s and in the United States during the Great Depression of the 1930s," he wrote in a research note.

In that context, Higgins said the Fed missed a chance to stay ahead of the curve by not announcing an increase in its purchase of Treasuries, thereby allowing benchmark bond yields to climb above 3 percent.

"The Fed appears to be more optimistic than the average economist that the few signs of stabilization that we are seeing in the US economy are going to lead to a sustainable rebound in economic growth later this year. The central bank may have to backtrack on this position in the coming months by expanding its purchases of Treasuries and its overall balance sheet quite a bit more than currently anticipated."

As things stand now, the Fed has bought $76.8 billion in Treasuries so far out of $300 billion committed in its March policy announcement. Bond yields this week surpassed the levels last seen before the measure was unveiled.

ITV executive chairman Michael Grade said he had only seen once before Thursday the clip of Susan Boyle singing on ITV show "Britain's Got Talent", that has received more than 100 million hits on YouTube, but has not yet netted the broadcaster revenue from the video-sharing site owned by Google.

"I've been incredibly busy over the last few weeks and I have only had one opportunity to view a piece of television that's taken the world by storm," he told the Voice of the Listener & Viewer Spring Conference in London.

"I'd like to have another look at Susan Boyle," he said, before playing the video.

ITV is reported to be in discussions with YouTube about monetising traffic
generated by demand for the 47-year old Scottish church volunteer.

Grade, who last week announced he would step down as executive chairman of ITV, is reported to loathe YouTube, and has called it a parasite living off content created by broadcasters.

If you're confused by the scandal surrounding the Ponta Negra hedge fund and its Biden landlords, don't blame yourself: it's really confusing stuff. If you have the patience for it, just read John Hempton's archives: start here, and then run through this, this, this, this, and this. (Don't worry, there's more to come, but we're up to something over 6,000 words already.) Alternatively, Alphaville is running its own series, of which the first two parts are now up: 1,700 words on 650 Fifth Avenue, and 1,250 words on the Biden connection. The Alphaville posts are quite hard to follow, partly because the FT lawyers have stripped them of links, and partly because this whole thing is just very opaque and complex.

The one thing which is abundantly clear is that Jeffry Schneider (always mistrust people who can't spell their own name) is a very shady character indeed, who was fired from various financial-sector jobs before ending up selling fraudulent hedge funds and seemingly working out of the Bidens' hedge-fund hotel. Schneider was a "marketer" for hedge funds, including Ponta Negra -- which means he sold them to rich individuals, and took a commission for so doing. How did he find the rich individuals? Lots of ways, but one was that he paid upwards of $10,000 a month for access to lists of people who were rich enough to qualify as hedge-fund investors.

This is the bucket-shop end of the hedge-fund world: small and sleazy and shadowy. But here's the thing: if you're a rich individual who's phoned up by Jeffry Schneider and told about some fabulous new hedge fund you should put lots of money into, he has a pretty good explanation for why it's so difficult  to get any information on him and his company: under the laws banning the advertising of hedge funds, he's not allowed to give out much in the way of information.

As part of the forthcoming regulation of hedge funds I think there should be a lot of efforts to make them more transparent, rather than allowing them to use SEC regulations to justify their opacity. At the moment, simply giving out information about certain investments is considered to be advertising: I used to run into this problem the whole time when I was in New York, covering 144a bond issues which could only be sold to big institutional investors, and being told that therefore I couldn't get any information on them. We need to move instead to a world where information is allowed to be free, even if the public at large still isn't allowed to invest in the funds or securities in question.

Once we get there, it should become much easier for bloggers to uncover Ponzis -- which is certainly a good thing. Hempton has a big advantage in that he's part of that world himself, and has access to information which isn't freely available online. Why can't we all have that access?