Some of the biggest names in real estate have long coveted the skyscraper, making it the Helen of Troy of office buildings, the façade that launched a thousand schemes. Five years after Donald Trump sold the building, he still regrets giving it up. Developer Sheldon Solow, one of the world’s richest billionaires, never owned it but has spent years in court proving he should have.
And Mr. Macklowe, the besieged current owner, is desperate to hang on to some small stake in it. According to a person familiar with the matter, he has asked bidders to specify whether they would keep him involved in at least the management of the property.
The news that Fidel Castro is stepping down brings various predictions from the papers. The Los Angeles Times says businesses are optimistic that trade restrictions will be lifted. The Journal says “Businesses Hold Few Hopes of More Trade Soon.” The Washington Post has more evidence behind its assertion that any changes will be gradual. It reports that the Bush administration says its won’t relax trade restrictions anytime soon.
We say, here’s a perfect opportunity to relax the ideological rigidity and explore a better policy toward Cuba. The one we’ve had for the last fifty-plus years sure hasn’t accomplished much. But in an election year, it might take Florida freezing over to get that done.
MBIA rehired its old CEO Jay Brown in a move the papers say could set the stage for the troubled monoline bond insurer to split itself into good and bad parts.
The FT says the hire likely means MBIA will consider splitting off its relatively safe municipal-bond insurance business from its rotten structured-finance business—something regulators have been pressing for in a bid to keep states and cities from having to pay much higher interest rates on their debt.
It isn’t clear why the firm is turning to its ex-chief now. The Journal and the NYT say his first tenure was marked by the move into the mortgage-securities realm that now has the company in so much trouble. Here’s the NYT, whose story is by far the best:
But other people familiar with MBIA’s business said they were puzzled by Mr. Brown’s appointment, given that he was either chief executive, chairman or both from 1999 to 2007, when the company aggressively wrote insurance policies on risky mortgage-related securities.
“This is back to the future,” said Leon J. Karvelis Jr., a former MBIA executive who worked at the company for 15 years before leaving in 1997. “I am sort of mystified by this move. I would have thought they would bring in new blood.
“We’re talking here about the guy who presided over the decision to move into structured finance, which has gotten this company into so much trouble.”
Whatever he did in the past, this guy’s a believer. The NYT says Brown sold some of his prized sports cars to buy MBIA stock three weeks ago.
The WSJ has some great reporting today in its A1 story on big retailers throwing their weight around against shoplifting suspects. In a process called civil recovery, retailers can harass suspects—even ones who have proven they are innocent—with lawsuit threats, demanding $200 or more to cover their theft-prevention costs.
But people targeted describe a humiliating and intimidating process, with no way to resist short of hiring a lawyer, a costly step few are able to take. Once a person’s name is turned over to a collection firm, he or she is dunned with letters and often phone calls, which refer to lawsuits and sheriff’s visits and sometimes multiply the penalty by demanding “pre-litigation” legal fees
The Journal’s done good work raising an issue with which we weren’t familiar, and with which we hope you weren’t either.
In economic news, HP turned in a solid quarter on overseas sales and raised its outlook for the year, though it said sales of its personal computers are slowing. The company’s board authorized a $3.3 billion share buyback because it thinks its stock price is cheap.
Wal-Mart posted a better-than-expected or right-on-target profit increase, depending on whether you believe Reuters or the WSJ. Sales at existing stores were up just 1.7 percent from a year ago, well below the rate of inflation.
And in the shaken, auction-rate securities market, the Port Authority of New York and New Jersey—in the news last week when its interest payments rose more than four-fold because of a market freeze—has better news this week. It’s interest payments dropped to 8 percent from 20 percent last week, but that’s still up from 4.3 percent before the crisis hit. Still, Bloomberg quotes an analyst saying the ARS market is still mostly not functioning.