Under The Radar News - Wednesday

by: SA Eli Hoffmann

Bernanke's private horror stories. Fed Chairman Ben Bernanke has said 'off record' in recent weeks that the U.S. economic situation is much worse than he has admitted to publicly, and predicts the first six months of 2008 will be "bad."

Another 0.5% next week? Federal funds futures contracts predict at least another 25 basis point rate cut at next week's FOMC meeting, while a majority of traders think the Fed will follow yesterday's 0.75% cut with another 0.5% cut next week.

Banks may not yet be a buy. Tuesday's 0.75% rate cut should help banks repair ailing balance sheets, but souring auto and credit card loans may force banks into larger-than-expected writeoffs the magnitude of which some say they haven't even begun to appreciate.

Cisco's quiet cutbacks. Sources say Cisco (NASDAQ:CSCO) recently began an abrupt and unannounced hiring freeze/cutback for high-level employees.

iTunes' empty promises. Almost a year after Steve Jobs wrote his manifesto against DRM-encoded music, Apple's (NASDAQ:AAPL) iTunes store is failing to deliver on its DRM-free promises. Meanwhile, most albums not available on iTunes can be had for $1 cheaper at AmazonMP3 (NASDAQ:AMZN).

Dell, Fonality form VoIP venture. In huge news for VoIP, Fonality and Dell (NASDAQ:DELL) will partner to make easy-to-use, affordable VoIP phone systems for the SMB (small-to-medium sized business) market.

Mystery announcement from CBS. CBS (NYSE:CBS) will announce Wednesday morning a mysterious "new unprecedented service" involving social music service Last.fm, which it acquired last year. What might it be? Some say CBS will port Last.fm's 'scrobbling' social recommendation engine to online video. On Tuesday, SMH Capital said CBS is a bargain (.pdf).

DRAM outlook healthy. Lower capex commitments by industry players will result in tight DRAM supply in the second half of 2008, leading to a healthy outlook for the industry, experts say.

PC sales in Asia Pacific exceed forecasts. Asia Pacific PC sales (excluding Japan) exceeded expectations in 2007, jumping 20.9% to 66.6 million units. Lenovo (OTCPK:LNVGY) led with 18.4% market share, followed by HP (NYSE:HPQ) at 13.9% and Dell (DELL) at 7.8%. Meanwhile, global PC sales are expected to drop in Q1 after strong shipments in Q4, but will rebound in Q2.

PDP shipments surge. After two lackluster quarters, PDP (plasma display panel) shipments jumped 27.1% in Q3 2007 on heavy consumer demand driven by rapid price declines, iSuppli said. The top-3 PDP suppliers, Matsushita (MC-OLD), Samsung SDI and LG Electronics accounted for 88.1% of total production.

LCD shipments jump. Worldwide shipments of large-size LCD panels surged 41% to 393.47 million units in 2007, Displaybank said. By company, AU Optronics (NYSE:AUO) was number one with 20.5% market share; Samsung Electronics and LG.Philips LCD (NYSE:LPL) each had 20.3%.

Sony seeks OLED partners. Sony (NYSE:SNE), which released the world's first OLED TV last year, is looking for strategic partners to boost production and sales of OLED panels. Topology Research Institute says shipments of OLED TVs will jump from about 4,000 units in 2007 to 3.75 million units in 2012.

Juniper axes DX boxes. Juniper (NYSE:JNPR) said it will phase out its DX line of application acceleration boxes due to a lack of differentiation between the line and competitors' products.

Fannie Mae's hidden troubles. Government-sponsored lender Fannie Mae (FNM), which relies heavily on mortgage insurers in purchasing high-LTV (loan-to-value) mortgages, could take a serious hit if one of the large insurers (PMI, MTG, RDN) were to blow up.

Don't short gold! Goldman Sachs (NYSE:GS) said it no longer recommends shorting gold, as it has since Dec. 11.

Real estate spinoff could disappoint Sears shareholders. If Sears' (NASDAQ:SHLD) planned restructuring includes the long-heralded spinoff of its real estate holdings, investors could be in for a sour surprise due to the spiralling value of residential and commercial real estate.

Insiders buy Mesa Air. Six Mesa Air (MESA) insiders bought 73,000 shares, betting things are looking up for the regional carrier despite a Q4 loss of $68.2M.