Private Equity's Hungry

Andrew Ross Sorkin, who writes the DealBook articles for the New York Times business section recently floated the opinion that Wall St.'s appetite for private equity deal may be so insatiable that the list of "potential targets being bandied about" now included Viacom, Gap, Nike, Dell, Home Depot, Texas Instuments, EchoStar, Liz Claiborne, and Microsoft.

Some of these companies have truly ridonkulous market caps for this sort of thing (MSFT). Some of these companies are in need of a complete makeover and thus better off dying a thousand deaths (GPS). Some of the others have potential.

CHK It Out: Borrowing In Euros

Chesapeake Energy (CHK) is selling EUR 400MM worth of senior notes on the Irish Stock Exchange. Interesting play.

The money will be used to pay down revolving debt, hard to complain about that. They indicated there is strong "demand on the continent" for opportunities to invest in their company and that this move was urged by their debt underwriters. It's a strong-euro kind of market these days, so your guess is as good as mine: do they expect a strong dollar by 2016, or is this just one more point to make in the "petroeuro" case?

No One Is Talking About Project Turquoise

Not in the U.S., anyway. Why?

What's uninteresting about the fact that seven major brokerages are attempting to create a stock exchange to compete with the LSE?

The major players are Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, Merrill Lynch, Morgan Stanley and UBS. They're responsible for about HALF of the business on the LSE right now.

Exchanges are -red hot- right now. Is this factored into, say, Goldman Sachs' astronomical share price? If not, is GS going to 250? 300?

Oh, and here's another thing. Think of how many companies are going public in London to avoid the regulations in the US. If you can go public on this exchange and avoid SarbOx, would you?

Taser Execs Ride The Buffalo

Taser's execs get zapped to show the safety of their product:

Delta to USAirways: Fuck a Duck

Delta sent out a press release this morning to all its customers addressing USAirways' buyout attempts which included this language:

But you should know we are concerned that this particular transaction would not be in the best interest of our many stakeholders including our customers, employees, travel partners, and the communities we serve. We are moving full steam ahead with our own plan to emerge from Chapter 11 as a strong, independent, stand-alone airline dedicated to providing you with world-class service and superior performance.

Sounds harsh, right? There's something in the language though that got my attention. Note "This particular transaction," folks. Stay tuned to this one.

Also, Insure This

I was in AIG just long enough to profit from their colossal earnings last week (high premiums + no hurricanes = mad cash, naturally). However, when every day my news on the stock is flooded with "Form 144: Filing To Sell" I have to wonder wtf is up with all the insider dumping. So I'm out.

Oil's Too Big For Its Britches

The prices of some of the oil companies vs. oil itself have gotten out of whack. XOM, CVX -- hell, most of the OIH in general (maybe not the refiners like VLO, but still...) -- are trading higher than they were when Lebanon and Israel were exchanging bombs and sending oil into the 70s.

XOM puts anyone?

Note also the impending offshore drilling bill the lame ducks may pass after Turkey Day. That one affects oil as well as natural gas.

Not Quite Granola

Check your organic foods section for this:



Wheat-free! Made from hedges, I assume. R said "Naturally, it gives you gas."

Published In Hindsight

Ah, NOW the lenders get together and publish a consumer guide on determining if interest-only mortgages and other nontraditional products are for you.

Link to the Fed's press release


Townhouse, anyone?

"The publication stresses the importance of understanding key mortgage loan terms, warns of the risks consumers may face, and urges borrowers to be realistic about whether they can handle future payment increases. If consumers are not comfortable with these risks, the publication suggests that they ask about other mortgage products."

Yeah.

Numerous links to the document available on the Fed PR page.

Good News for Mrs. Lay

...even if Kenny's not available for comment:

Ken Lay's conviction vacated

So the government spent a fortune on a trial and conviction, and now they have no chance to recover any of that cash. Does that now make this the most expensive demonization on record? For Halloween, should I wear a Ken Lay mask and my "How's Your Aspen?" t-shirt?

$1.65bn.

No commentary other than to say finally Google has a service that's not in beta.

свиньи?

Why do Gazprom's 2005 balance sheets show they hold livestock? Don't tell me they're literally sending pigs down their pipes.

Government, Save Me From The Nosy Execs

Hewlett-Packard investigation now yielding criminal charges.

It irks me that NOT A DAMNED ONE of the phone companies has stepped up to the plate and said they will do more to ensure the person they're giving info out to is the person in question. Yay for prosecutions. Yay. Wheeee.

Life insurance pays triple if you die from a goat bomb. Or not.

Bloomberg reports AIG has created an "Islamic unit" to target 300 million Muslim insurance buyers.

Do these policies include the standard language that there will be no payment if the damages are incurred as part of civil unrest, war, or terrorist action? Granted, if I lived there I'd be wanting to cover my ass right now (whether you're thinking Israel-Lebanon or the possibility of Dubya attempting a smackdown on Iran, either is valid) but if those restrictions so typical in US policies are also in the policies written in the Middle East, I'm not sure that demand will expand so much.

Send Stern Back To Earth

Rumors abound that Howard Stern may return to terrestrial radio. However, Stern constantly bags on terrestrial radio while he's doing his shows on Sirius, and Mel Karmazin swears it will never happen.

Perhaps they protest too much, and he will go back. But why is this such a terrible thing? Has he really brought in enough paying subscribers to earn that phenomenal amount of money he was paid to come to Sirius (and would, presumably, be returning most of if he broke his contract)?

I think not. If he goes, it may be a good thing for SIRI. Maybe it'll even encourage them to merge with XM, which is probably the best thing that could happen for satellite radio.

Making The Deflationary Case

Three things suggesting deflation, rather than inflation, could take hold:

1) Whiskey and Gunpowder's recent rundown of cheaper steaks at Outback, Cheesecake Factory's discount lunch menu, and TGI Friday's four-dollar appetizers.

2) $15 sneakers endorsed by Stephon Marbury.

3) The housing market.

Private Equity in ETF Form

There are a few business development companies making short-term and unsecured loans and those will soon be bundled into a nice little ETF. You can wait for the ETF, or you can buy up a few of them in anticipation. Via Marketwatch:

"The American Stock Exchange expects to start calculating and publishing the Listed Private Equity Index by the end of September, and PowerShares expects to launch the ETF next month. Because the index isn't yet published, Red Rocks can't comment on its initial components. Stocks that seem likely to make the cut include Apollo Investment (AINV), KKR Financial (KFN), Gladstone Capital (GLAD) and Allied Capital (ALD) . Most of these companies are affiliated with private-equity firms and make loans to private companies."

I picked up a little AINV. Buy it in the next 45 mins to get the 9/28 dividend.

Bies: Um, Sucks To Be The Kozlovs

The entirety of Governor Bies' commentary on the gangland-style assassination of Russian central banker Andrei Kozlov:

"We at the Board were shocked and saddened to learn of the death of Andrei Kozlov. His courage and vigor in pursuing the betterment of his country's banking system earned respect and admiration throughout the world. We extend our deepest condolences to his family."

No fighting words -- you afraid his enemies are now loitering around Brighton Beach? Hell, the Russian market didn't even blink. Maybe nobody wants Russia to be cleaned up...

Most Condos Have Bathtubs

http://www.condoflip.com/condo_flip_panic_buttons.asp

The site proclaims "Bubbles Are For Bathtubs" proudly on its front page. However, it has a traffic-light-style system for liquidation:

"If you are a seller using Condo Flip, we give you an opportunity to lower your price to a point that makes your condo irresistible to another buyer. Essentially, you are creating a dramatic price drop."

In a listing, green is a seller asking for a profit; yellow is essentially break-even; red indicates willingness to take a loss. I browsed through the listings and there's not many reds to be seen yet, but watch that space.

Reserved for D. Patrick

Race-car chica Danica Patrick inked a big deal today with Motorola. Sponsors have fawned over her recently, despite the fact that she has never won a race.

Do they see this as a chance to ink a cheaper deal with a up-and-comer, or has she merely done a better job marketing herself as "racing girlie novelty item" than she does driving a car around in circles?

Brings Anna Kournikova's mediocre tennis career to mind, though Danica has a far lower hooch factor. Ah, well, we can't all be Maria Sharapova.