BofA delivers good governance a kick in the teeth

October 2, 2014

The mega-bank has given CEO Brian Moynihan the additional title of chairman. The move not only puts too much power in one person’s hands, it reduces the position to a perk that can be granted or taken away, depending on performance. That’s a lousy governance deal for investors.

Goldman’s new conflict rules raise bigger question

October 1, 2014

Bankers there face fresh limits on investing in stocks, bonds and hedge funds. Goldman knows how easy it is to cross a line when treading close to it. Why Wall Street dealmakers can own individual securities at all is the real mystery that speaks to a culture loath to change.

PayPal forced to rev after eBay’s belated U-turn

September 30, 2014

The $70 bln online auction company has for years resisted setting free its payments business. Apple and Alibaba created more urgency than Carl Icahn and other investors could. EBay squandered a big early advantage, but independence may yet give PayPal a chance to play catch-up.

UK retail fails to weather the patently obvious

September 30, 2014

Clothes shop Next says Britain has had an unseasonably warm September. Who knew? Shares across the sector took fright at the ramifications for earnings. Investors may be venting other fears, maybe of a price war. Still, the reaction reveals a bizarrely inefficient market.

Commodity bear market looks entrenched

September 29, 2014

A rising dollar, the prospect of U.S. rate rises, and moderating Chinese growth are casting long shadows over the asset class. The threats to the bear case are strong supply-side responses, or successful economic stimulation by the ECB. Neither looks very likely.

Bill Gross and Janus Capital made for each other

September 26, 2014

Both are formerly hot fund managers looking for a fresh start. Investors are exuberant about the possibilities of Gross recapturing some old glory under Janus, the Roman god of new beginnings. It is more likely a case of past performance not being indicative of future results.

Sam Waksal’s new biotech tests Wall Street amnesia

September 26, 2014

The former ImClone boss who went to prison for an insider trading scandal that also ensnared Martha Stewart plans to take his latest venture public this year. He follows second-chancers like Donald Trump and LTCM founder John Meriwether. Investors can be astonishingly forgiving.

Apple CEO Tim Cook gets $25 billion warning shot

September 26, 2014

That’s the value wiped off the stock after a botched system update and reports its new phones can be bent. It’s a small hit for a $600 bln company. But the 2012 Maps fiasco is a reminder that one-off issues may presage more pain. Cook needs to nip this one in the bud.

Tesco chairman should step aside

By Chris Hughes
September 25, 2014

Richard Broadbent will struggle to restore market confidence in the UK retailer. This week’s accounting scandal compounds existing concerns about his period at the helm. The priority should be an orderly handover to the right successor. But speed matters too.

Starbucks avoids froth in $913 mln Japan buyout

September 24, 2014

The U.S. coffee chain is buying the 60.5 pct of its Japanese business it doesn't already own at a discount to the unit’s market value. Expiring licenses give Starbucks a chance to take control of a large market on the cheap - as long as minority shareholders don’t resist.