The Five Dumbest Things on Wall Street This Week

1. Just Who the Michael J. Fox Are These Guys?

Not that there isn't enough confusion and disarray over at AOL Time Warner (AOL), but now we have an identity crisis.

Yes, we at the Five Dumbest Things Research Lab already were trying to keep track of whether Steve Case will resign, what the next incarnation of America Online will look like, and whether Ted Turner is divorced from Jane Fonda and/or dating her. Then came the Mike Kelly problem.

No, this is not the Mike Kelly problem most likely to pop up in the minds of embittered AOL Time Warner investors: deciding an appropriate fate for J. Michael Kelly, the company's former chief financial officer, the man whose brief tenure as CFO of the merged America Online and Time Warner was marked by confident financial projections the company failed to achieve.

Rather, this is a more obscure Mike Kelly problem: How to distinguish Mike Kelly from Mike Kelly.

You see, in a hiring move that doubtlessly has AOL Time Warner's switchboard operators banging their heads with their handsets, AOL Time Warner announced last Friday that it had appointed one Michael J. Kelly, chief executive of American Town Network and former publisher of Time Warner's Entertainment Weekly, as AOL Time Warner's president of global marketing solutions.

Got that? Michael J. Kelly, not J. Michael Kelly.

Meanwhile, J. Michael Kelly, former CFO, hasn't left the building. After spending nearly a year as chief operating officer of AOL Time Warner's online unit, J. Michael Kelly just last Thursday was named CEO of AOL International and named to America Online's Senior Strategy Group, whatever that is.

If you want to tell J. Michael from Michael J. -- and who of us doesn't? -- the guys aren't making it easy. Both go by "Mike," sans initial. Michael J.'s job -- working with clients "to develop and implement cross-platform marketing solutions that take full advantage of all of AOL Time Warner's businesses," according to the company -- sounds vaguely like what was supposed to be one of J. Michael's jobs over the past year: working with AOL Time Warner's other divisions "to fully leverage AOL's platforms" and "to further drive convergence across AOL Time Warner."

Mike, Mike AOL likes Mikes

So we called AOL Time Warner's main switchboard in New York to chat with Mike and Mike. On our first try, the operator sent us to "Mike Kelly in Global Marketing" -- Michael J., that is. When another operator sent us to "Mike Kelly in Corporate," we ended up at a nonworking phone number. A follow-up call, to America Online's headquarters in Dulles, Va., landed us at J. Michael's office.

While J. Michael never called us back, Michael J. did manage to reach us on Friday morning, after the first edition of the FDT had hit the streets. In fact, says Michael J., there hasn't been much confusion around the office. When the two Mikes compared notes on Thursday, they counted only one misdirected email apiece. Michael J., based in New York, and J. Michael, based in Virginia, have met only once in person, says Michael J. -- maybe a few months ago, in passing, in some AOL Time Warner hallway somewhere.

Despite our disappointment that this Mike Kelly duplication hasn't resulted in any wacky, sitcom-worthy hijinks and misadventures, we at the lab are extremely proud of the discovery we made in the course of our research: There is a third Mike Kelly at AOL Time Warner, one who works in marketing and promotions at Elektra Records. "Someone called to say, 'Congratulations on the promotion,'" says Mike Kelly No. 3. "'I got promoted?'" he recalls replying. "'They didn't tell me!'"

For the record, this particular Mike Kelly has no middle name.

2. Aflac Catches Flak

What is news? We ask ourselves that question nearly every day here at the research lab -- not that we ever get around to answering it.

But today we'll try. News, we believe, is stuff we just heard about.

And that's how we justify running this next item: a report about correspondence between a nonprofit organization known as United Poultry Concerns and the insurance company Aflac (AFL).

You've probably heard of Aflac, which runs hours worth of TV commercials featuring a duck vainly trying to pitch Aflac in locations such as an ice rink, a barber shop, the Grand Canyon and a natural history museum.

Quack Attack Aflac hears squawks about the duck

What you probably haven't heard of is United Poultry Concerns, an entity "dedicated to the compassionate and respectful treatment of domestic fowl," according to its Web site.

See, on March 4, UPC sent a letter to Aflac complaining about the use of the duck in its ads. Whether or not certain sequences in the ads feature a live duck or a stunt duck, suggests UPC's well-meaning President Karen Davis, Aflac should cease "putting animal abuse images in people's minds."

Writes Davis, "We request that you find ways to sell your product without using live animals and without implying that putting a live animal in a harmful or degrading situation is funny. If you plan to keep the duck logo, why not switch to a person in a costume? We simply ask that you do not promote your product at the expense of those who are vulnerable to human cruelty and abuse."

Of course. Showing a duck in one of Aflac's ads that is, as Davis describes it, "(alive or simulated, but to the viewer, alive) hanging upside down in a bat cave, as in a slaughterhouse" -- that's objectionable. But a person hanging upside down, as in a slaughterhouse? Indeed, that's funny.

Aflac spokeswoman Abby Spinello says the company has been getting, uh, a flurry of emails recently about the cruelty-to-poultry issue. After enduring months of the public's silence on this issue, Aflac has received 35 emails on the subject since Wednesday, says Spinello, for reasons the company hasn't figured out yet. All but one of these new correspondents, she says, are supportive of Aflac.

And why shouldn't they be? "We don't think that these commercials show or promote animal cruelty," says Spinello. No birds were harmed in the production of these commercials, she says. Except, we're sure, for the ones on the film crew's lunch table.

3. Coke Adds Something, but We're Not Sure It's Life

Believe it or not, sometimes we at the FDT lab attempt to do work that might actually have a bearing on a company's financial performance.

Take this investigation of a recent report from the New York Post.

Please.

Yes, last Friday the Post reported in its "Page Six" column -- which, we never tire of telling people, never runs on page 6 -- that Coca-Cola (KO) apparently "has a new product, Coca-Cola Herbal, coming out in Japan, which is being marketed to women 16-22, with the pitch that the soda supposedly will make their breasts grow."

Coke Implants They're the real things?

Wow. Big news.

So, we did what any reporter would do in order to judge the accuracy of this story. Which is check to see if anybody else picked up on the story. Safety in numbers and all that.

No safety there, unfortunately. No stories anywhere on Coca-Cola Herbal, before or since.

So, reluctantly, we did what someone once told us to do in journalism school, which is to call up the company itself for comment. Coca-Cola, believe it or not, did not return our call.

Then we did the next thing they told us to do in J-school, which is call up an industry expert. We found Skip Carpenter, food & beverage analyst at Thomas Weisel Partners.

Carpenter doesn't find the Post report to be credible. More precisely, says Carpenter, "That's the most ridiculous thing I've heard of in my life."

True, says Carpenter, the Japanese beverage market is characterized by speedy new product life cycles. "Coke is repeatedly trying to find new beverages that can meet the demands of a fickle and choosy Japanese consumer," he says. But as for Coca-Cola Herbal and its reputed qualities, says Carpenter, "I haven't heard anything along those lines."

Richard Johnson of Page Six wasn't immediately available for comment.

4. You Can Trust Your Car to the Man Who Wears the Star Currently Under Exclusive License to Equilon Enterprises LLC and Motiva Enterprises LLC

Uncle Miltie has got to be spinning in his freshly dug grave.

ChevronTexaco (CVX) proudly announced Monday that it will start selling gasoline under the Texaco brand in mid-2004.

Silly us. We at the research lab had blithely assumed that an oil company with Texaco in its name would have been selling Texaco gasoline all along.

But no. That shows you how little we know about the oil industry, mergers and acquisitions and antitrust law. Not to mention the dark arts of branding, in which labels and logos correspond only randomly to particular manufacturers, products or services.

We'll spare you the boring details, but it turns out that Texaco gas in the U.S. is currently sold by non-ChevronTexaco companies, whose exclusive rights to use the name expire in 2004 and whose nonexclusive rights last until 2006.

"The Texaco brand has a worldwide reputation as a symbol of quality products and customer service," says a ChevronTexaco executive in a statement, "and it has been one of the most recognized brands in the U.S. for more than 90 years."

No matter whose gas they're pumping.

5. Hill of Beans Is More Like It

EDS' Golden Egg Everything glitters for Dick Brown

Finally, this week's Problem? What Problem? Award goes to EDS (EDS) CEO Dick Brown.

So what if the computer outsourcing company says third-quarter revenue won't rise 4% to 6% from a year ago, but fall 2% to 5%? So what if income will be one-fifth of expectations? So what if after the company announced its shortfall Wednesday evening, its market cap got sliced in half Thursday?

The future looks bright, Brown said in a Wednesday evening conference call. "The gold is in the hills," he said.

Why, sure it is, Dick. Good luck finding it.

>To order reprints of this article, click here: Reprints