It was just two weeks ago today that I was fussing about the huge Research in Motion (RIMM) advertising GRPs (see prior post “Worried about RIM” Oct 19-09), and what the omnipresent campaign must mean about RIM’s competitive environment. It was an ominous sign I figured. Since that day, the stock is off about C$10 (14%). More to come, it appears.

Technical analysts gave the stock a drubbing last week. And earlier Monday, Citibank’s analyst concluded that although the stock was a “buy” last Friday, RIM’s lock on the enterprise market was finally going to crack. This time for real. Time for a “sell” rating.

The quantum of outstanding Canadian commercial bank loans dropped by another $2.6 billion during the month of September, the largest one month decrease since January 2009. This came on the heels of August data which suggested a slowing in the decline of business loans to the Canadian corporate and SME sector.

The category is “Business loans to Canadian residents for business purposes”, and the data is from the Bank of Canada:

I suspect that, most days, I make errors in judgment of some form or another. Rarely do they hurt, fortunately, and we all hope to learn from previous mistakes. Like the time I made a U-turn on Wellington Street in 1991 without first looking; a Korean-made sedan hurled into my front left quarter panel and looked much the worse for wear after the encounter with my Pathfinder. I lost little more than a turning signal, but his repair bill wasn’t small. His front and rear doors were smashed in. Haven’t made that mistake again.

A few weeks ago Fabrice Taylor sounded the alarm about the state of the world at Research In Motion (RIMM). He was focused on weakening gross margins, and wondered why RIM continued to spend so much on R&D and so forth. As a long time RIM fan and shareholder, I read the piece with care and wondered if there was anything in the analysis that should cause me to jump for the exits.

It could be a new name of a sauce made by President’s Choice, but the raft of blow-out U.S. bank earnings last week justifiably turns the mind to “Memories of mark-to-market”. How long ago was it that our accounting Lords decided that M-T-M was the way to go? Not very long at all.

Did they listen to industry professionals when they professed that Fair Market Value accounting treatment was misguided (see prior representative posts “Accountants are failing investors with ‘fair value’ accounting” Aug 6-07 and “D’Alessandro: fair market value accounting is ‘perverse’” Sept 30-08)? Nope.

Bank analyst Meredith Whitney made headlines Tuesday when she downgraded Goldman Sachs (NYSE: GS) to a “neutral” from a “buy”. With Goldman up over $130 from its US$40s low of earlier this year, Ms. Whitney may well by right that the time has come to take some money off the table. JP Morgan (JPM) and Bank of America (BAC) shares have also recovered somewhat from the meltdown, which could well be all the gas they have left until the market has some clarity on 2010/11 earnings.

But let’s not make too much of the fact Ms. Whitney “called it right” on Citibank (C) last year. She did, but the fact pattern surounding that call is entirely different than the one today. As for being perfect, no analyst would pretend to wear that label.

Although we receive dozens of research pieces each day, it is always hard to guess which items might be of interest to our readers. As the economy continues to strengthen, the Goldman Sachs Leveraged Finance Weekly Market Update for the Technology, Media, Telecom & Gaming sector seems topical.

Key highlights:

More good economic news coming from the Canadian railroads, according to a report out from Raymond James’ equity research railroad analyst:

Railroad freight volumes have bottomed and are on the road to recovery, in our view, suggesting the industry is poised to enjoy a healthy tailwind alongside a gradual improvement in the North American (N.A.) and global economies. While still down sharply yoy (17.3%), freight and intermodal carload originations have shown steady improvement after struggling to find a bottom during the final weeks of May. Specifically, we note that North American (N.A.) volumes have risen by approximately 20.0% over the past four months, an impressive updraft by most accounts. Moreover, a closely watched basket of leading economic indicators continues to support this improving trend, which we view as encouraging.

Perhaps satellite radio just isn’t targeted at me.

I had the chance to spend three hours driving a car, solo, with the dulcet tones of Sirius to help me along. It was my first opportunity to see what all the fuss was once about.

Here’s a quiz. You have $26 billion in assets. Most of them are liquid, but certainly not all.

You’ve got 13% in private equity, 25% in “real assets”, a chunk of hedge funds, and you “hold” cash at negative 5% (which means you borrow to goose returns). This from the WSJ:

Some HR coaches will tell you that if you start doing a job, eventually someone will just give it to you.

That must be what Ericsson was thinking when it offered jobs to 680 Nortel employees yesterday, even though its US$1.13 billion Nortel sub acquisition hasn’t closed yet (hat tip OBJ). According to the report, the fuse on the job offer was short and almost everyone accepted their position.

It is far too quiet on the Ericsson / Nortel / Research In Motion front. No move at the Court of Appeal, no media leaks, no scrums, no industry lobbying, no evidence of any activity on RIM’s part to create a “Canadian solution” for Industry Minister Tony Clement to consider.

This cannot be good for those of us who were so certain that the Federal Government would find a way to spirit Nortel’s LTE assets into RIM’s hands (see prior post “Ericsson’s deal for Nortel is DOA” July 28-09). They blocked the MDA division sale, after all, which is less integral to Canada’s Innovation Economy than Nortel is.

The truth is, the Silver Lake-led acquisition of Skype looks like both a technology and an infrastructure investment. Which may partially explain why Canada’s CPP Investment Board was able to get comfortable putting US$300 million into a deal that will live and die based upon technology and customer trends over the years to come.

For US$1.9 billion in cash and a US$125 million note, an investment group led by tech-saavy private-equity firm Silver Lake Partners (including venture-capital firms Index Ventures and Andreessen Horowitz, as well as the Canada Pension Plan Investment Board) now own 65% of Skype. eBay (EBAY) keeps the rest. The US$2.75 billion valuation is healthy compared to a run-rate revenue of US$680 million; Q2’s revenue was up 25% versus the prior year. I was but one of the 142 million users registered for Skype during the previous 12 months. I suspect more than a few came via the profile Skype gets from the Oprah Show.

When you asked yourself the question, “how did Nortel wind up bankrupt?” all you need to do is consider the accounting dishonesty creativity of their balance sheet.

According to my morning Globe and Mail, Nortel (NRTLQ.PK) is valuing certain CDMA and LTE patents at $149 million, rather than the US$1.13 billion that Ericsson (ERIC) has promised to pay for a non-exclusive perpetual licence. If the Globe’s sources are in-the-know, this means that the Nortel sale doesn’t meet the federal government’s minimum deal review threshold of $312 million.

It is starting to feel like December 2003. Folks in the tech industry will know what I’m talking about. Software co. Workbrain went public, becoming the first technology story post-bubble to “get out” on the TSX. It was a great event for VC-backer Edgestone, and the sought-after leads went to RBC Capital Markets and CIBC World Markets.

The U.S. tech IPO window is always the first of the two to open, and at last check the six recent U.S. tech IPOs were all trading above issue price. More will be lining up by the day, although the challenge will be far fewer Underwriters to work with now that their i-banking market has shrunk. The U.S. post-IPO trading success can only mean one thing. Get ready for the new domestic tech IPO market, ’cause it is right around the corner.

As the Ericsson (ERIC) / Nortel (NT)/ Research In Motion (RIMM) saga continued Tuesday, one new bit of relevant information emerged from the Bankruptcy Court hearing. It telegraphed a couple of points: First that Nortel anticipated some public fallout might arise from the sale of its crown LTE jewel to a foreign bidder, and second, that they had a trick up their sleeve to deal with whatever Industry Canada review would come to pass.

This from the Globe’s coverage:

It’ll be a few weeks, maybe even months, before every last word is said on the topic of Ericsson’s (ERIC) bid for Nortel’s LTE and CDMA business. But I’ve had an epiphany; the deal isn’t going to happen. For the same reason that ATK / MDA wasn’t approved (see prior post “Prentice is right to reject MDA space deal” April 10-08). No net benefit to Canada; at least not that anyone has seen so far.

After Inco, Falconbridge, Labatt, Molson, Sleeman, ATI, Dofasco, Corel, Cognos, Westcoast Energy, etc., etc., the nation has had enough. Some of these firms matter to the country’s economic future, while others did not. We’re all for a free market, and we’ve lived and died by the sword of Free Trade for the past 20 years. But strategic assets are just that.

In the wake of the Jayson Blair scandal at the New York Times, many of the world’s best media brands have put themselves through the ringer. The New York Times and Wall Street Journal now go out of their way to ensure that whenever they cover someone else’s exclusive story, they refer to the annal that originally broke the news: As in “as first reported by XYZ media”.

In the evolving world of media and blogs, The Associated Press is trying to legislate how its content gets utilized by anyone who isn’t a subscriber (such as a member newspaper) to the AP wire.

While we all were hiding under our desks, something was going on at Canada’s largest chartered banks. They were deftly swinging into preservation mode. Think about the brutality of the past twelve months for both the economy and the financial services industry, and then pull up a share price chart for the Big 6 banks.

The stock prices of all but one of the six are up over the past twelve months. Plus the dividends have continued without a haircut, unlike at Bank of America (BAC), Citibank (C) and WellsFargo (WFC) for example.

It hasn’t even been 12 months since Goldman Sachs (GS) took on US$5 billion of pref shares (see prior post “Life imitates art as Buffett invests in Goldman” September 24-09) from Warren Buffett’s Berkshire Hathaway (BRK.A), and I wouldn’t be surprised if Goldman is already thinking of ways to pay back his investment.

Berkshire’s perpetual preferred shares came with a 10% dividend, but Goldman can buy them back at a 10% premium to face value when the day comes that they can issue prefs in the public markets at a cheaper yield. Back in September, Goldman’s 2031 6.75% subdebt was trading at $76, implying a yield of 8.9%, 110 bps below the yield on Berkshire’s prefs.

According to this morning’s New York Times, lender CIT Group (CIT) will not be granted access to the FDIC’s debt issuance guarantee program. This takes me by surprise, as the murmurs coming out of Washington (according to CNBC) following the weekend’s WSJ piece suggested that CIT would be able to tap into the program that allows banks to issue fixed income paper, with investors receiving a backstop from the U.S. government. This appears to be now off the table (NYT):

While CIT would be the largest American bank to fail since Lehman Brothers collapsed last fall, the company is relatively small, and few analysts say its failure would threaten the broader financial system. Nonetheless, given CIT’s historical role in financing smaller businesses, President Obama was briefed on its status Wednesday morning.