Has a media-wide plot been hatched to keep The Business Press Maven happy as the summer winds down? The main culprit causing this unaccustomed feeling of good cheer to keep washing over him is the continued good coverage of the
Federal Open Market Committee
As you loyal readers know, The Business Press Maven wanted to poke sticks in his eyes
earlier in the year, so badly was the business media misunderstanding the basics of these Federal Reserve committee notes.
Like the general public, the business media had grown so accustomed to lower rates that they let themselves become almost willfully ignorant of the Fed's intentions. Poring over the Fed's notes, the Wrong-Way Corrigans -- uh, I mean the business media -- kept saying that the Fed was done raising rates.
Such promise didn't exist in the text, even between the lines. In fact, at one meeting, Ben Bernanke, then the incoming Fed chairman, hadn't even taken his seat yet, meaning that what came from the meeting had little long-term relevance. Still, the business media assuredly told us, things were cool with rates. They weren't going up. And as long as there was this level of misunderstanding in the market, stocks were not going anywhere. Truth, that old bugbear, eventually comes out and gets woven into stock prices.
But now The Business Press Maven is hurtling toward everlasting happiness. That's because almost everywhere he has looked, both this morning and last, he finds evidence that the business media read the Fed minutes accurately. It was a close call, but the Fed decided to leave rates where they were for -- and this is the key realization -- the time being. The Fed governors are doing this -- for the time being -- in the hope that inflation will ease, uh, easily and the economy will slow but not stall.
Now, you could, like the Maven, be suspicious that the Fed doesn't fear stagflation -- high inflation and low growth -- as much as it should. But the point, from the perspective of the financial markets, is that if the Fed notes are being publicly misunderstood in a big way, you can't even get over that layer of idiocy to debating whether or not the Fed is doing the right thing. Now that we have a realistic presentation, the market can decide whether that reality is favorable or not.
Talk about reality;
seems to exist in an altered one. It
reported Monday, and the stock has since soared. What is so strange is that throughout the whole housing boom thing, this high-end home-product retailer, which should have been a prime beneficiary, kept reporting bracingly bad results. Now that the housing boom has gone the way of Duran Duran and home-product company conference calls are sounding a little like
A View to a Kill
, Restoration Hardware reported better-than-expected earnings.
But before you jump on this unlikely little bandwagon, check out Nathan Parmelee's
of the numbers at Motley Fool. While praising the earnings and 3.1% increase in gross margins, Parmelee points to long-term cracks in the form of inventory and receivables growth that outpaced sales in a big way. Read the rest if you are thinking of restoring your faith in Restoration.
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Well, hell hath no fury like salty snack executives getting disinvited to obesity meetings, huh?
The New York Times
this morning that
is moving toward spinning itself off from
, formerly known as the Marlboro Men.
It seems that the packaged-food behemoth is sick and tired of indignities like getting left off the dance card at the World Health Organization's obesity conference in Geneva because of the tobacco connection. Ironically, of course, there is evidence of a correlation between the demise of smoking and the rise of obesity. Cigarettes seem to serve as an appetite suppressant, but I guess handing them out to a world of chubby schoolkids is a non-starter to the scolds at the WHO, so they said no to Kraft, a final indignity in a complicated relationship.
Mentioning Duran Duran and then getting on the subject of vices has me thinking of one of my favorite addictions of the 1980s: Foster's "oil cans." Remember drinking those big beers in those big cans around the time of
? I didn't think so. Anyhow, the
on takeover speculation over Australia's Foster's, which recently reported good results.
And even mentioning the gruesome spectacle that is Tom Cruise seems beneath The Business Press Maven's regal level of dignity. But let me do so, if only to once again teach my timeless lesson: Do not to rely on headlines.
In the past day or two we've seen countless headlines like this one from
The Wall Street Journal
Tom Cruise Gets Financing From Six Flags' Bosses
As you know, The Business Press Maven has been
making sport of whether
, a business with more (literally) moving parts than most, can turn it around. And with so much to do, turning focus to Scientologists who jump on couches probably won't help.
But read down from the headline, which seems to imply that Cruise got financing that resembled what he had at Paramount. In truth, it is less than a third of what he had from Paramount, and Mr. Anti-Ritalin will have to come up with movie-production financing himself. No word on whether his next role is to stuff himself into a character with a carpet head to entice people into empty amusement parks. But here's the word on headlines: They are often too simple, so always read down.
Please note that due to factors including low market capitalization and/or insufficient public float, we consider Restoration Hardware and Six Flags to be small-cap stocks. You should be aware that such stocks are subject to more risk than stocks of larger companies, including greater volatility, lower liquidity and less publicly available information, and that postings such as this one can have an effect on their stock prices.
A journalist with a background on Wall Street, Marek Fuchs has written the County Lines column for The New York Times for the past five years. He also contributes regular breaking news and feature stories to many of the paper's other sections, including Metro, National and Sports. Fuchs was the editor-in-chief of Fertilemind.net, a financial Web site twice named "Best of the Web" by Forbes Magazine. He was also a stockbroker with Shearson Lehman Brothers in Manhattan and a money manager. He is currently writing a chapter for a book coming out in early 2007 on a really embarrassing subject. He lives in a loud house with three children.