Dec 5, 2012 17:03 UTC

Pharma lands one-two punch on government finances

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By Robert Cyran and Reynolds Holding

The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

Pharma has landed a double blow against the American government. The U.S. Court of Appeals in New York has ruled that a drug salesman was exercising his right to free speech by pitching a narcolepsy drug as effective against insomnia, chronic fatigue and other conditions the Food and Drug Administration had not approved. If the Supreme Court upholds this decision, companies will pay fewer multi-billion dollar fines and useless healthcare spending will increase.

Dec 4, 2012 08:37 UTC

SEC learns true cost of China accounting goodwill

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By John Foley

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

China’s shaky accounting practices are a sound target for U.S. regulators. Or at least, they would have been ten years ago. The Securities and Exchange Commission’s action against China-based auditors, including affiliates of big accountants like KPMG and Deloitte who refuse to hand over files on U.S.-listed companies, comes too late. If the SEC pushes the point, it could bring a moral victory, but a financial mess.

COMMENT

Caveat emptor – buyer beware!

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Dec 3, 2012 22:00 UTC

Wall Street deal-making has lesson for Washington

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By Jeffrey Goldfarb

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

When it comes to deal-making, Washington could learn from Wall Street. The U.S. budget talks have become the equivalent of an ugly, public merger proxy battle. While investment bankers are often too eager to push for a deal, they also know that negotiating in public usually only makes things tougher.

COMMENT

I think that every congressman should be able to draw a diagram for any individual in any industry such that the diagram shows the avenues by which money spent by the individual circulate back to the individual. Without this visualization, no person can discus what improves or impedes the circulation of money. With this visualization, we can imagine many different excellent solutions to the fiscal conflict.

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Dec 3, 2012 19:33 UTC

SandRidge CEO sets bar even lower for oil patch

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By Christopher Swann

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

Tom Ward, chief executive of troubled oil and gas explorer SandRidge Energy, has set the bar even lower for the oil patch. He is not the first energy boss to live large at shareholders’ expense. But his extravagance at the nearly $3 billion U.S. company would make even TV villain J.R. Ewing blush. Angry owners are right to want him out.

Nov 30, 2012 19:31 UTC

Review: How a maverick CEO exposed a scandal at Olympus

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By Quentin Webb

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

Society and markets need whistle-blowers. But it’s hard, lonely work. Michael Woodford’s “Exposure” details first-hand how the maverick executive blew the whistle on a $1.7 billion accounting scandal at Olympus, the company he ran. His integrity makes him a welcome outlier in an age of financial scandal.

Nov 30, 2012 19:24 UTC

Groupon discounts dual-class share structures

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By Robert Cyran

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

Groupon’s melodrama is discounting dual-class share structures. Chief Executive Andrew Mason and Chairman Eric Lefkofsky appear locked in a dysfunctional battle over how to run the flailing company. The board is keeping Mason at the helm, but the fighting probably isn’t over. Super-voting shares like the ones both men own are meant to give founders flexibility. But Groupon is a reminder of just how dangerous the arrangement can be.

Nov 30, 2012 07:52 UTC

HK exchange plays it safe with equity finance

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By Peter Thal Larsen

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

Hong Kong’s stock exchange is playing it safe. The bourse’s $1 billion share placing will allow it to repay more than half the debt it took on to buy the London Metals Exchange earlier this year. Ultra-low yields might make bonds look tempting. But a recent share rebound, and HKEx’s hefty dividend payout, justifies its cautious approach.

Nov 29, 2012 19:07 UTC

Corporate America fears taxes more than recession

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President Barack Obama is seeking input from Corporate America on the so-called fiscal cliff. But whatever company honchos may be saying about the risk of recession in 2013 if tax hikes and spending cuts kick in on Jan. 1, it looks as if they actually fear higher taxes more than a downturn.

Exhibit A is the recent flurry of special dividends, including a $3 billion whopper announced on Wednesday by warehouse retailer Costco. Data group Markit says 112 firms so far this quarter have already pulled the trigger on special dividends. They include casino operator Las Vegas Sands, which will send more than $1 billion to Mitt Romney’s pal Sheldon Adelson, his wife and the trusts the billionaire controls. Markit expects 20 more firms to do something similar before the year is through.

Nov 29, 2012 14:37 UTC

Spain’s bank rescue is part bail-in, part bail-out

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By George Hay and Neil Unmack

The authors are Reuters Breakingviews columnists. The opinions expressed are their own

Spain’s bank haircuts are part bail-in, and part bail-out. The indebted government has lopped 10 billion euros off its euro zone-funded bank rescue bill by cutting the value of its worst lenders’ hybrid debt. Yet if it hadn’t been for political considerations, the burden-sharing might have been greater.

Nov 29, 2012 05:47 UTC

Low valuations don’t make China stocks a bargain

By Wayne Arnold

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

Conventional gauges of value make China’s stocks tempting, particularly amid signs growth may be picking back up. But even if the economic rebound lasts, stocks haven’t been great proxies for corporate growth. Even China bulls should be ursine on the country’s equities.