Charge it! Despite ongoing credit issues, consumers are falling further into debt. Obsessive spenders who previously used home equity lines to pay their bills are increasing credit-card spending, resulting in bulging default rates on credit-card balances and car loans. Total consumer debt has nearly doubled over the past decade.
Small, telling signs. As housing market woes deepen, shoppers are showing their unease by opting for generic/store-branded products, and by using holiday gift certificates to buy food and necessities instead of extras.
OPEC to stay put. OPEC sources say the cartel is unlikely to cut oil output at a meeting in March amid rising energy prices and uncertainty about supply from Venezuela and Nigeria.
HD DVD - down but not out? Despite widespread reports that Toshiba (OTCPK:TOSBF) will give up development of its HD DVD standard, ceding victory to Sony's (SNE) Blu-ray, sources say Toshiba is unlikely to close its HD DVD operations. Toshiba met with makers/suppliers of HD DVD components yesterday and pledged to continue with its HD DVD business. Sources say Toshiba-supported Toshiba-Samsung Storage Technology will continue to develop inexpensive HD DVD Blue-ray competitors.
Microsoft may get hostile. Sources say Microsoft (MSFT) will escalate its bid for Yahoo (YHOO) by authorizing a proxy battle in order to put pressure on Yahoo's board, which sources believe is vulnerable to a proxy fight. One disadvantage of going hostile is the risk that Yahoo employees might leave the company at an even faster rate than they already are.
Dissecting Google. Google's (GOOG) annual 10-K report reveals a full-time headcount increase in 2007 to 16,805 from 10,674 -- 5,788 in R&D, 6,647 in sales and marketing, 2,844 in general and administrative and 1,526 in operations -- all of who are equityholders. Besides the $3.1B it spent on DoubleClick and $625M on Postini, Google bought 17 smaller companies in 2007 that cost it $282M. Google also warned that, as it continues to reduce accidental ad click-throughs, revenues may fall.
AMD claims Intel has unfair India advantage. AMD (AMD) is lodging a complaint with the Competition Commission of India against what it views as Intel's (INTC) monopolistic trade advantage in the country. AMD contends that up to 90% of government tenders ask bidders to submit bids with machines having only Intel-based CPUs. Government purchases account for 15-16% of all sales in India.
China telecom makeover done deal. China's State Council approved telecom restructuring plans at a Feb. 15 meeting and will soon make an announcement. Sources say China Netcom Group (CN) and China Unicom (CHU) have begun exchanging shares in preparation for their merger. China Mobile (CHL) will take over China Tietong.
Citi deals Japan HQ to Morgan. In a deal worth about $445M, Citigroup (C) sold its Japan headquarters to Morgan Stanley (MS). The sale-and-lease-back deal, Citi said, is a means of reducing the risk of holding property assets, thereby improving its overseas unit's balance sheet.
Not just hot air. CTI Industries (CTIB) has signed a deal with Ziploc bag maker S.C. Johnson to make a new line of bags -- ZipVac -- which remove virtually all the air from plastic storage bags using a handheld vacuum. Analysts say the deal could have big upside for CTI, better known for its novelty balloons.
OLED gets bigger. Sony (SNE) will spend over $200 million to scale OLED technology up to medium- and large-panel TVs. Sony's current model is just 11". Just 3 mm thick, OLED TVs consume 40% less power than a comparable LCD, with faster refresh times and a better viewing angle.
HP goes mini. A source within HP (HPQ) says the company will release an UMPC (Ultra Mobile PC) in the late spring. "You won't even need to consider this purchase. You'll buy it like a handphone without a thought," he says.
Omaha oracle faces scrutiny. Accusations of collusion after Moody's (MCO) -- in which Warren Buffett's Berkshire Hathaway (BRK.A) is the largest shareholder -- downgraded or put on notice bond insurers (ABK, MBI) not long after Buffett generously offered to save the troubled firms by taking their most lucrative portfolios off their hands for a hefty fee.
Satellite spread narrows. The spread between Sirius (SIRI) and XM (XMSR) shares is at its tightest since they announced their proposed merger one year ago today. Apparently investors believe the incessant chatter that the DoJ is about to approve the deal. Sources say officials were given one last chance to oppose the deal before Antitrust division chief Thomas Barnett signs off on the deal.
Wire cutters? Damage to five underwater cables that caused internet outages across the Middle East and Asia may have been an act of sabotage, the International Telecommunication Union says. "Some experts doubt the prevailing view that the cables were cut by accident, especially as the cables lie at great depths under the sea and are not passed over by ships," its head of development said.