Bond insurer bailout hits roadblock. The bailout of troubled bond insurer Ambac (ABK) has hit a significant snag, CNBC's Charlie Gasparino said Friday. On Wednesday ratings agencies said they wanted the banks involved in the rescue to put up more than the proposed $2.5B in order for Ambac to retain its AAA rating. Sources say the consortium will address the issue by backing down from its idea of breaking up Ambac into its risker and less-risky businesses, instead finding a resolution that keeps the two together, which could mean even less than $2.5B is needed. Sources are confident the deal will go through, because the players are acutely aware of the dire consequences a downgrade could have.
Sad dollar better than no dollar. A depressed U.S. dollar has detractors such as famed investor Jim Rogers calling for its demise as the world's dominant currency. Still, considering two-thirds of the world's central-bank reserves remain denominated in dollars, and its entrenchment in trade of global commodities such as oil, it seems unlikely to be booted from its perch any time soon.
Private-equity: Nowhere near dead. Top private-equity groups are in the midst of one of their most ambitious fund-raising rounds ever, even as old-school deals hit financing snags. Firms including Apollo, TPG, Blackstone (NYSE:BX), Bain Capital and KKR are raising tens of billions of dollars; hefty new contributions from sovereign wealth funds are more than compensating for a lack of domestic investors. The current round is similar to the peak of the private-equity boom in 2006 and early 2007, and indicates ample liquidity remains in the financial system despite of recent market turmoil.
Bear rebels. Investors have seized control of two failed Bear Stearns (NYSE:BSC) hedge funds, a move their lawyers think will enable them to sue Bear for compensation over the funds' $1.6B collapse. Here's the strategy: Although the "feeder funds" seized contain but a few hundred thousand dollars, they give investors a platform to sue Bear without having to reveal their names, which hedge fund investors are notoriously unwilling to do.
Equity bear feeds commodity bull. Powerful rallies in commodity markets -- partially fed by investors fleeing battered stock and bond markets -- have been a boon for commodities ETFs, which now hold about $30B -- up 90% from one year ago. Some industry experts say recent price run-ups defy all logic, and think some of the hottest markets may have bubbled. If the pressure persists, the rally could have serious consequences for global prices of food and other basic materials.
Reneging on rescue. Bank of Montreal (NYSE:BMO) may withdraw from an effort to restructure $33B in stranded asset-backed commercial paper. The bank told a group of commercial paper investors it may no longer be able to contribute to a $14B line of credit that is being used to convert commercial paper into long-term debt. The move comes as Bank of Montreal faces margin calls of $500M+ on two of its own commercial paper trusts.
Microsoft optimistic on Yahoo merger. "We continue to have a very close dialogue with Yahoo's (NASDAQ:YHOO) shareholders (and) Yahoo's management," Microsoft (NASDAQ:MSFT) senior vice president Jean-Philippe Courtois said. Though the talks appear to be informal, the ice may be thawing.
iPod use still growing. 40% of iPods sold in the U.S. were to first time buyers, COO Tim Cook says. "In thinking about this number, this doesn't feel like a saturated market to us." Doing the math reveals Apple (NASDAQ:AAPL) managed to convert another 3% of Americans into iPod owners last year.
Up or down? SearchIgnite, based on a survey of 500 large marketers, said paid Google (NASDAQ:GOOG) click-throughs are up 45.7%; ad spending is up 40%; and impressions are up 60%. This, in contrast to comScore's Monday chiller that clicks were down 7% q/q and flat on the year. "Our clients continue to have faith in the search marketing channel," SearchIgnite said. SearchIgnite's research only address large marketers, while comScore relies on a panel of consumers.
Baidu hit with copyright suit. Chinese search engine Baidu (NASDAQ:BIDU) is being sued by a Chinese music industry consortium for alleged copyright violations. Baidu is carrying out "unfettered piracy," the Music Copyright Society contends, which allows it to earn "huge advertising revenue on its huge number of hits."
Fly high with Expedia. Barron's says online travel site Expedia (NASDAQ:EXPE) may actually benefit from tough times due to its ability to broker deals between desperate suppliers and frugal customers. "When suppliers want to get rid of inventory they look to Expedia, when consumers want to get better prices [on airfare and hotels], they'll look to Expedia," Oppenheimer's Malindi Davies says. Citigroup analyst Mark Mahaney thinks shares will hit $38 over the next 12 months, a 62% gain.
Put a touch on Midas. Business Week likes automotive services provider Midas (NYSE:MDS), whose shares have fallen as consumers push off car repairs. Midas has been a heavy buyer of its own shares, slashing debt all the while. Gamco Investors' (NYSE:GBL) Mario Gabelli says shares could double over the next three years.