The WSJ leads its Business & Finance column with the news and the NYT puts it on the front of its business pages, saying the bid is further evidence that consolidation is under way in the video-game industry. Here’s an interesting bit of analysis:
EA’s action follows an even bigger bid by Microsoft Corp. for Yahoo Inc., continuing a new trend of unsolicited offers in the maturing tech sector. Such companies had long stuck to negotiated acquisitions, on the theory that unfriendly transactions could spur the departure of talented engineers and programmers that were seen as key assets of target companies.
The Chicago Tribune has a colorful piece on a house well, we can’t improve on the lead here. If this doesn’t make you want to read a story, we don’t know what will:
The new buyers of a rundown graystone on the South Side showed up Jan. 9 to look at the house they won at a foreclosure auction. They took the plywood off the front door and went inside to make sure the utilities had been shut off. Then they called the police.
Sitting upright in the corner of a bedroom off the kitchen was a human skeleton in a red tracksuit. Next to him lay a dead dog. Neighbors told police the corpse was almost certainly Randy Johnson, a middle-age man who lived alone in the North Kenwood house.
The cause of Johnson’s death has not yet been determined, but it is just one of the mysteries about 4578 S. Oakenwald Ave. Somehow, Johnson’s house was transferred three times to new owners without anyone noticing he was inside. It’s a story involving forged deeds, a corrupt title company and a South Side family that has been under investigation for mortgage fraud.
Left holding the bag is Countrywide Home Loans, the nation’s largest mortgage lender and a company whose practices are being scrutinized by the Illinois attorney general’s office.
Countrywide had to take back the house from the latest suckers er people it sold it to after Cook County officials threatened the lender. The Tribune says the ordeal shows that lenders taken in by fraudsters have little incentive to blow the whistle before dumping the problem on someone else.
Bloomberg has a good analysis of the impact of the government’s moves so far on the economy and the likelihood that the stimulus plan will fail.
The news service says the tax-rebate plan will boost spending in the second half of the year, but that will only be a temporary reprieve for an economy that will continue to struggle for a long while under the weight of bad debt, consumer retrenchment, and investor suspicion. Bloomberg quotes economists predicting growth of as low as 0.9 percent—in 2009.
It says there’s not much the government can do.
So far, the Fed’s deepest interest-rate cuts since 2001 haven’t helped the financial markets or the economy. What they have caused is an increase in inflation expectations, with the price of gold soaring to a record $958.40 an ounce last week.
Oops. Oh well, higher inflation will at least help all those borrowers pay off their underwater home loans a little bit more easily.
The WSJ goes above the fold on page one with a report saying the U.S. is preparing a move against Iran’s central bank, which it says is laundering money for sanctioned private banks.
The U.S. put sanctions on the Iranian banks two years ago for aiding the country’s nuclear program and, allegedly, terrorism. It’s unclear what effect, if any, a U.S. move would have on Iran, since Europe and other countries would have to cooperate with American moves, something that seems unlikely.
The Journal’s Heard on the Street column says the Goldman Sachs juggernaut may finally be slowed this quarter by the effects of the credit crisis, and it’s shares are likely to fall “much further.”
Leveraged loans, like the one Wachovia is trying to back out of above, are likely to be the main culprit. It is committed to fund loans worth more than 10% of its entire market value and with the value of those loans having tumbled, it will likely face a big writeoff this quarter. Some equity investments also have fallen in value.
Revenue in its core investment banking business is likely to be down, too, up to 50% from last quarter, says the WSJ, weighing further on results.
The Washington Post reports the Army is spending $800,000 to Walt Disney Company to sprinkle some stardust on Walter Reed Army Medical Center’s woeful care system, impressively exposed in the paper’s pages last year.
Apparently the hospital’s employees are learning from Donald Duck and the like how to and how not to treat “customers.”