Global Investing

from MacroScope:

Is that a bailout in your pocket?

There was an awkward moment of tension at the Milken Global Conference in Los Angeles, when a buysider on one panel asked a Wall Street banker whether he had pocketed taxpayers' bailout cash.

The tit-for-tat began when several panelists at the "Outlook for M&A" session began griping about the U.S. government's tax policy, which they said dissuades corporations from bringing overseas profits back home because of punitive taxes.

The panelists – including James Casey, co-head of global debt capital markets for JP Morgan, Anthony Armstrong, an investment banker at Credit Suisse, and Raymond McGuire, global head of corporate and investment banking at Citigroup – predicted that the M&A market might get a big boost if the U.S. were to offer a tax holiday of sorts for repatriated profits.

They also suggested such a move could be a boon for hiring and economic growth: Tilman Fertitta, a panelist who is chairman and CEO of the consumer products company Landry's, said he would certainly feel the incentive to do more deals and invest more at home if he could bring back his overseas profits without being taxed. He even wondered why Mitt Romney and Barack Obama hadn't made such a proposal a key point in their election campaigning.

But just before the executives could launch into a profit repatriation samba, another panelist stopped the music.

Ford: Failure to Communicate?

fordtruck11Here’s an idea for Ford — make sure that when you talk to The Street that The Street is listening.

The shine on the Blue Oval got smudged Friday as shares fell as much as 15 percent after its fourth-quarter profit missed estimates by almost 40 percent. Why? Analysts were apparently blindsided by more than $1 billion jump costs in the fourth quarter compared to the third.

It was the first time Ford fell short of estimates in two years, and the miss upstaged what was an otherwise notable year. Ford reported its best annual income in more than a decade and had more cash than debt in its automotive operations, a key milestone it has aimed at hitting for more than a year.

from Funds Hub:

Live from the City Oscars 2010

I'll be at the Guildhall in London today for the latest run down of the financial sector's favourite brokers, analysts and fund managers.

Why are analysts so wrong?

Is there something faulty about the way Wall Street analysts look at the companies they cover?  Once again, with the latest quarterly earnings season about to end, the analysts have been wrong. This time, they have been way off the board wrong.

With 480 of the Standard & Poor’s index of 500 leading companies having reported, Thomson Reuters research has found that some 73 percent came in better than expected. Only 9 percent of consensus projections were right and 19 percent came in worse than expected.

To a certain extent, this is not suprising. The consensus heading into the latest quarter was made gloomy by the state of the world economy and a lot of stock market losses over the past couple of years. You can be over-pessimistic just as easily as you can be over-optimistic.