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Monthly Archives: March 2012

In Focus: How Breitbart Helped to Launch Huffington Post

“Andrew Breitbart, the hyperactive, charming, and divisive creator of Big Government and its sister sites who died today at 43, also served as the link between two of the dominant media forces of the last decade: The Drudge Report, which he helped run for years, and Huffington Post, where he was present — briefly — at the creation.

Breitbart’s role as Drudge’s right hand is well known; less public was his brief, memorable stint as one of four partners in the Huffington Post in 2005. It’s a story that hasn’t been told in great detail, but BuzzFeed founder Jonah Peretti, who also co-founded the Huffington Post with with the site’s namesake Arianna Huffington and media business figure Ken Lerer, recalled that period in an interview today.

Breitbart’s role later became contested — he brashly claimed total credit for “the plan,” which his former partners denied — but he was an unmissable presence in the Soho office that was for a time Huffington Post’s New York headquarters. There, for a month in the spring of 2005, he worked closely with Lerer (who is now Chairman of BuzzFeed), and Peretti, a graduate of MIT’s media lab, to launch the site.

“He taught us a lot of things early on,” Peretti said, recalling how Breitbart showed them key features of the media ecosystem. “He explained about looking at the British newspapers late at night because they would sometimes break news before the U.S. papers. He cared about getting links up seconds or minutes faster than other publications and was obsessive about that.”

Breitbart was also a font of ideas, not all of which made it into practice.

“He wanted every commenter to have to pay $1 to comment, and the dollar would go to charity but the user’s true identity would be authenticated through a credit card,” Peretti recalled, noting that the idea prefigures current attempts to authenticate identity online.

He also proposed “a phone number where celebrities could call in and leave voice blogs that would automatically appear on the site ,” Peretti recalled. “He wanted that built before launch, and launch was four days away.”

His creativity, as many who worked with him know, could be hard to contain.

“He was just incredibly difficult to have in the office – he was totally ADD and would jump from idea to idea. He would spend hours playing fantasy baseball during the day. He was incredibly good at fantasy baseball,” Peretti said, but then started talking to another Huffington Post employee about starting a fantasy baseball company amid the Huffington Post launch.

There were also also ideological tensions from the start….”

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Old Man Buffet’s Favorite Indicator Down for a 3rd Consecutive Week

Source

“Here’s a negative trend we’re going to want to keep a close eye on.  This week’s rail traffic is showing a negative reading again.  Intermodal was down 2.8% while carloads were down 5%.  The 10 week move average remains positive, but dipped to 4.3% from 5.2% last week. The year to date change has now turned negative.  The AAR has more details:

“The Association of American Railroads (AAR) today reported a decline in weekly rail traffic for the week ending February 25, 2012, with U.S. railroads originating 281,644 carloads, down 5 percent compared with the same week last year. Intermodal volume for the week totaled 214,402 trailers and containers, down 2.8 percent compared with the same week last year.

Nine of the 20 carload commodity groups posted increases compared with the same week in 2011, with motorvehicles and equipment, up 30.9 percent; petroleum products, up 25.6 percent, and metals and products, up 19.4 percent. The groups showing a significant decrease in weekly traffic included coal, down 13.1 percent; grain, down 11.9 percent, and nonmetallic minerals, down 10.8 percent.

Weekly carload volume on Eastern railroads was down 8 percent compared with the same week last year. In the West, weekly carload volume was down 2.9 percent compared with the same week in 2011.

For the first eight weeks of 2012, U.S. railroads reported cumulative volume of 2,272,480 carloads, down 0.3 percent from last year, and 1,772,839 trailers and containers, up 1.6 percent from last year.”

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CoreLogic: Third of All Mortgage Holders Are ‘Underwater’

“About one-third of all homeowners with a mortgage owe more on their homes than they’re worth or are close to it, according to a report from CoreLogic, a data analysis company.

CoreLogic research finds that 1.1 million, or 22.8 percent, of all residential properties with a mortgage were in negative equity at the end of the fourth quarter of 2011, up from, 22.1 percent in the previous quarter, CNBC reports.

Another 2.5 million borrowers that have less than five percent equity, referred to as near-negative equity, in the fourth quarter….”

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Marc Faber: Government Will Seize Gold

“Economist Marc Faber, publisher of The Gloom, Boom and Doom report, says the government will seize privately held gold, even as he continues to buy physical gold himself.

“I prefer to play the commodity space by owning physical gold,” Faber tells Chiefsworld. “If I were an American, I would store it outside the U.S., because in the U.S., it is not completely unlikely that they will eventually take it away.”

“Like in 1933, gold will be purchased back by the government” because eventually the financial mess will be so bad that gold prices “will go ballistic, and the government will take away something from a minority, and not many people own gold.”

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Shutterfly Continues it PreMarket Jump at Open; Stock Up 16% on Purchase of Kodak Unit

“NEW YORK (AP) — Shares of Shutterfly Inc. surged before Friday’s opening bell as analysts say the online photo publisher’s plan to buy Kodak’s online photo service will remove a big competitor and benefit growth.

Eastman Kodak Co., which filed for Chapter 11 bankruptcy protection in January, said Thursday that Shutterfly wants to buyKodak Gallery for $23.8 million.

The deal would include the transfer of Kodak Gallery’s 75 million U.S. and Canadian customer accounts and their images to Shutterfly, although Kodak customers can opt out…”

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U.S Equity Preview: SFLY, SATC, SLE, MOTR, FLOW, ESL, ASNA, & ALSK

Source

Alaska Communications Systems Group Inc. (ALSK) : The Anchorage, Alaska-based telephone company reported fourth- quarter earnings of 5 cents a share, beating the average analyst estimate of 4 cents.

Ascena Retail Group Inc. (ASNA) (ASNA US): The women’s apparel retailer forecast profit this year of at least $2.75 a share, above the average analyst estimate of $2.67.

Esterline Technologies Corp. (ESL) : The aerospace and defense parts supplier raised its forecast for 2012 earnings to between $5.10 and $5.40 a share, from $5 to $5.30 previously.

Flow International Corp. (FLOW) : The maker of industrial water jets used for cutting and cleaning reported third-quarter earnings of 7 cents a share, beating the 5-cent average of two analyst estimates.

Motricity Inc. (MOTR) tumbled 17 percent to $1.09. The provider of mobile-data services reported a loss of 14 cents a share in the fourth quarter, wider than the average analyst estimate of a loss of 10 cents.

Sara Lee Corp. (SLE) rose 6.4 percent to $21.70. The maker of Douwe Egberts and Senseo coffee said its international coffee company filed for a spinoff under the name DE International Holdings NV.

Satcon Technology Corp. (SATC) dropped 6 percent to 47 cents. The maker of inverters, which converts electricity from solar cells for use on electric grids, forecast first-quarter revenue of no more than $28 million, below the average analyst estimate of $38.1 million.

Shutterfly Inc. (SFLY) rallied 15 percent to $31. The company agreed to buy Kodak Gallery, an online photo service with more than 75 million users, for $23.8 million.

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Gapping Up and Down This Morning

Gapping up

BIOF +22.2%, SFLY +17.1%, ASNA +10.4%, FLOW +7.3%, ALSK +5.5%, BGCP +3.4%, IDSY +1.6, GCO +1.9%,  CBRX +12%,  ARNA +3.3%,

RENN +1.3% , VE +4.2%,  CIE +2.3%,  FIO +1%,  MSI +0.8%,

Gapping down

NTWK -26.1%, CCSC -17.4%, PRTS -14%, MOTR -13.6%, MALL -7.5%, DPM -4.5%, FOLD -2.7%, FL -2.1%, AUTH -1.4%, NWSA -1.7%,  ITT -1.1%,

AONE -10%, HMY -2.3%, MT -2.1%, AU -1.6%, SLV -1.2%, BHP -1%, GDX -0.5%, STO -1.1%, BP -1%, SDRL -0.9%, E -0.9%,  TOT -1.7%, DPM -4.2%,

BUD -1.5% ,  GNC -1.4% ,  NOK -1.3% ,  IPGP -0.5% , RCL -1%

 

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Upgrades and Downgrades This Morning

Source

Alcatel-Lucent, S.A. (NYSE: ALU) Cut to Market Perform at Bernstein.

American Water Works Company, Inc. (NYSE: AWK) Cut to Neutral at Baird; named as Momentum stock of the day at Zacks.

BlackRock, Inc. (NYSE: BLK) Cut to Neutral at Credit Suisse.

Comerica Inc. (NYSE: CMA) Cut to Market Perform at Raymond James.

Domino’s Pizza Inc. (NYSE: DPZ) Reiterated Buy and raised target to $46 at Argus.

KB Home (NYSE: KBH) named as Bear of the Day with Underperform rating at Zacks.

Lowe’s Companies Inc. (NYSE: LOW) Raised to Equal-weight at Morgan Stanley.

MetroPCS Communications Inc. (NYSE: PCS) Maintained Buy with $15 target at Argus.

Monster Worldwide, Inc. (NYSE: MWW) Cut to Neutral at UBS.

Motorola Solutions, Inc. (NYSE: MSI) Raised to Outperform at Credit Suisse.

Regions Financial Corporation (NYSE: RF) Raised to Outperform at Raymond James.

TAL International Group Inc. (NYSE: TAL) named as Value stock of the day at Zacks.

Texas Capital Bancshares (NASDAQ: TCBI) Raised to Outperform as Bull of the Day at Zacks.

Travelers Companies (NYSE: TRV) Cut to Equal-weight at Morgan Stanley.

Unum Group (NYSE: UNM) Raised to Outperform at RBC Capital.

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This is Not a Garden-Variety Post-War Inventory Recession

“For some time we have maintained that the economy, following the severe 2008 credit crisis, would grow at an exceeding slow and uneven pace, and this is the way it is playing out.

This is unlike the garden-variety post-war inventory recessions that were mostly short and shallow, and followed by robust rebounds that quickly exceeded prior peaks.

The crisis was caused by an extraordinary debt boom that will take many years to work off and create severe headwinds to economic growth.

Household debt as a percentage of GDP averaged 55% over the past 60 years, but soared to 99% by 2008.  It has now declined to 87% and still has a long way to go before returning to anything near normal.  Federal government debt has climbed from 56% of GDP in 2000 to 97% as of September 30th, and is undoubtedly higher now.  In our view the overall debt is the single most important factor to take into account in analyzing the future growth of the economy.

The reduction in household debt since the 2008 peak has been the key factor in dampening economic growth to date.  In fact, household debt has now been down for 13 consecutive quarters after never being down for even one quarter in the entire post-war period!

The effect of deleveraging is not a vague academic theory, but is clearly reflected in the real numbers.  GDP in the fourth quarter was only 0.8% higher than it was at the peak four years earlier.  In the last four quarters GDP growth was only 1.6%.  While fourth quarter GDP growth was an annualized 3.0%, two-thirds of the amount was accounted for by inventories.  These probably have to be pared down in the first quarter.  By almost any measure the current recovery has been far weaker than any other post-war expansion….”

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Will the Keystone XL Pipeline Really Be a Benefit to Us ?

“I’ll get us that oil from Canada,” Mitt Romney said in his victory speech after the Michiganprimary. He was referring to Keystone XL, the crude-oil pipeline that has become a top-tier campaign issue for Republicans.

Problem is, the tar-sands oil in that pipeline wouldn’t be coming to “us.” It would go directly from Canada to refineries in the Gulf region en route to export markets in Latin America and Europe. The U.S. would be used as little more than a transit corridor.

We’ve heard a lot about groundwater contamination near the completed portions of the pipeline — more than a dozen spills of the highly corrosive oil, including one near Kalamazoo, Michigan, that they can’t seem to clean up. Conservative Nebraskans became greens overnight when they learned the details of the project that will go through their state.

But the immediate effect of completing the Keystone pipeline (perhaps by 2015) is more surprising and counterintuitive.

The project would increase domestic oil prices by more than $6 a barrel and prices at the pump in parts of the country by about 20 cents a gallon. You read that right. At a time when rising gas prices threaten President Barack Obama’s re-election, the Republicans’ most ballyhooed remedy — a new pipeline — would make the problem worse….”

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