Feb 12, 2015 17:03 UTC

A fat and happy GM is a dangerous company

Photo

By Rob Cox

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

About halfway through his account of the U.S. government’s rescue of the automotive industry, “Overhaul,” Steven Rattner describes a Eureka moment. As President Barack Obama’s former car czar tells it, a young financial whiz on his staff, Harry Wilson, bounded into his office in the bowels of the White House waving a sheaf of papers, saying: “We’ve been thinking about this the wrong way.”

COMMENT

There is too much emphasis on company performance when handing out bonuses to employees. I worked on a team at GM where the manager would leave for a week numerous times per year and never tell anyone (at least no one who worked for him). He never cared much about what happened on his team as long as he could make himself sound important when he spoke to his bosses and peers. It was disgusting that no matter what issue you sought his help with, he could only offer childish advice and a lot of nodding and agreeing.

Posted by alphaRomeo2 | Report as abusive
Feb 12, 2015 15:16 UTC

Yahoo’s Alibaba spinoff attracts big discount

Photo

By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Yahoo can’t even earn a reward for doing what shareholders wanted. The company’s plan for a tax-free spinoff of its stake in Alibaba looks logical. But a Breakingviews calculator suggests investors are attaching a 34 percent discount to the U.S. tech firm’s Alibaba shares – assuming, that is, Yahoo’s core business is worth something.

Feb 12, 2015 14:19 UTC

Credit Suisse earns the chance to be proactive

Photo

By Dominic Elliott

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

For once, Credit Suisse is on the front foot. Shares in the Swiss bank surged more than 9 percent on Feb. 12 after it kept its full-year dividend intact and revealed reassuringly robust fourth-quarter results. Better still, in outlining up to another 70 billion Swiss francs ($75 billion) in asset cuts this year, Chief Executive Brady Dougan is adopting a more proactive approach to tackling his bloated balance sheet.

Feb 11, 2015 20:56 UTC

Drugmakers unlikely candidates for next big short

Photo

By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Drugmakers make unlikely candidates for the next big short. Kyle Bass, a hedge fund manager who bet successfully on a U.S. housing crash, is targeting pharmaceutical companies worth a combined $450 billion in market capitalization. A new method of challenging patents gives him a tool. But it’s not clear how his firm, Hayman Capital, has a leg up on existing, aggressive and experienced generic firms.

Feb 11, 2015 09:09 UTC

Sky’s insecurity helps Premier League net $8 bln

Photo

By Quentin Webb

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Sky’s insecurity has helped the Premier League net 5.1 billion pounds. With the pay-TV giant afraid to test what would happen if it lost its first place in English soccer, the big winners are the clubs.

Feb 6, 2015 20:54 UTC

DuPont drives wedge between shareholders and Peltz

Photo

By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

DuPont has driven a wedge between shareholders and Nelson Peltz. Adding two turnaround veterans to the $70 billion chemical giant’s board may make stockholders think twice about voting in a rival slate from the billionaire activist’s Trian Fund Management. DuPont says Peltz nixed an offer to add one of his picks because he wanted the spot. He may just have been outplayed.

Feb 5, 2015 21:40 UTC

Rob Cox: When CEOs are worth more as former CEOs

Photo

By Rob Cox

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

When it comes to creating value for shareholders, one move a chief executive officer can make is to quit. Shareholders applauded two high-profile CEO departures at big public companies this week: Ally Financial and Petrobras, Brazil’s state-controlled energy giant. Ousters at McDonald’s recently and Microsoft in 2013 earned similarly positive reactions. Though each case is unique, the common thread seems to be relief after a leader becomes entrenched and inflexible.

Feb 5, 2015 20:20 UTC

Pfizer’s generics injection lifts mood for breakup

Photo

By Robert Cyran

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Pfizer has made more than its share of value-destroying acquisitions. The pharmaceutical giant’s $15 billion purchase of Hospira could reverse that history. The injectable-drug maker’s strength in non-branded medications should boost Pfizer’s own generics unit – and open the way for spinning it off.

Feb 4, 2015 18:56 UTC

Smucker deal may keep activists in Kibbles ‘n Bits

Photo

By Kevin Allison

The author is a Reuters Breakingviews columnist. The opinions expressed are his own. 

J M Smucker’s $5.8 billion purchase of Big Heart Pet Brands may keep investor activists in Kibbles ’n Bits. The $11 billion owner of Folgers coffee, Jif peanut butter and eponymous fruit spreads should gain bargaining power with retailers by bundling human treats with dog food. But the odd combination may elicit a Pavlovian response from uppity shareholders.

Feb 2, 2015 12:52 UTC
Edward Hadas

Negative yields can go much more negative

Photo

By Edward Hadas

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

The spread of negative yields in the bond market is both distressing and, in theory at least, sound. The numbers after the minus sign could become larger.