News Corp. posts $1.6-billion loss as revenue drops 7%

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Couldn't have happened to a nicer guy. Rupert Murdoch I wish you and your corporate propagadists nothing but ill will. QB
By Meg James, Los Angeles Times
August 9, 2012
News Corp. reported a nearly $1.6-billion loss in its fiscal fourth quarter, reflecting the declining value of its publishing businesses — a beleaguered unit that it intends to spin off into a separate publicly traded company next year.

For the April to June quarter, the Rupert Murdoch-controlled company reported a net loss of $1.55 billion, or 64 cents a share. That compared with a $683-million profit, or 26 cents a share, for the fourth quarter of fiscal 2011.

The quarterly results, reported Wednesday, included a $2.9-billion pre-tax impairment and restructuring charge that the company said was related to its Australian newspaper and TV operations and other publishing titles. During the quarter, the company took a $57-million charge related to costs of ongoing investigations into the bribery and phone hacking scandal that has engulfed the company's British newspaper subsidiary.

The company's publishing portfolio includes the Wall Street Journal, New York Post, Times of London and the HarperCollins book publishing house.

Excluding the charges, News Corp.'s fourth-quarter profit came in at 32 cents a share — matching analyst estimates.

News Corp. generated revenue of $8.4 billion for the quarter, a decline of 7% from the nearly $9 billion it took in during the year-earlier period. Strength at the company's key cable television networks was weighed down by issues elsewhere in the company, including sagging ratings at Fox Broadcasting Co.'s once dominant TV franchise "American Idol."

The cable television programming group, which boasts the Fox News Channel, FX and regional sports networks, once again performed as the company's all-star, generating operating income of $792 million, a 26% increase from $631 million in the year-earlier period. Advertising revenue to the domestic cable networks rose 5%. Revenue for the group was $2.5 billion.http://www.latimes.com/business/la-fi-ct-news-corp-earns-20120809,0,4485249.story
Why does the US have to step in? QBConcerted plan between States and the ECB to save the euro

The European Central Bank (ECB) will not lead only the "great battle" to save the euro. She would prepare, according to our information, a concerted action with the states. Thursday, July 26, Mario Draghi , Chairman of the European monetary authority said something strong, but ambiguous. "As part of my mandate, he said, from London, the ECB will do anything to protect the euro . "Adding, enigmatically:" Believe me, this will be enough. "


While it will take another few days or even weeks to finalize the device in question, the ECB would prepare an operation coordinated with the states may limit the surge in interest rates of Spain , but also the Italy .
The President of the ECB and key executives in the euro area have increased contacts in recent days. The negotiations were to continue in the day Friday. A telephone conversation between Francois Hollande and German Chancellor Angela Merkel , is scheduled for 13 am (Paris time).


Thursday, investors did not know exactly what tools would be deployed. But, if no action policy quickly, they devised to rely on an efficient monetary operations. "There's an important phrase said Mr. Draghi is what 'trust me. this will be enough" , advanced Gilles Moec, economist at Deutsche Bank. "The ECB may leave a bazooka, "he predicted.


Minutes after the words of the boss of the ECB, the Spanish borrowing rate to ten years already fell to below 7% after their record to more than 7.5% Wednesday. While Italian debt of similar maturity rebasculaient to 6% against 6.5% more than a few hours earlier.


MONITORING LEAN


Initially, the idea is, according to various sources, to operate the European Financial Stability Fund (EFSF), or his successor from September, the European Stability Mechanism (SPM), to buy the debt issued by Madrid, or Rome, in the primary market. That is to allow these states to finance at reasonable cost.


At that time, the ECB would boost its bond buyback program on the secondary market, where it is bought and sold the bonds previously issued to ensure that rates do not fly away. "The ECB will not without government: it will act if they are willing to operate the relief fund ", decrypts an EU official. So much for the urgency.


Remains a stumbling block: convince Spain to make use of the aid of European funds. An option that Mariano Rajoy, the leader of the Spanish government, has so far refused, for fear of seeing his country switch under the tutelage of its funders. An intermediary program, with a simplified and sanitation budget constraints could be considered more flexible in good agreement with Spain, does one slip in Brussels.


In a second step, the action of the ECB and the states could take a form more spectacular. It would then be subject to grant a banking license to the relief fund Europe. And so they do receive some sort of collateral with the ECB allowing to increase their firepower. With this option, states would have difficulties in access to a virtually endless tap of cash.


But in Berlin and the North, ultra-Orthodox, this idea may shock : it breaks a taboo by allowing the ECB to fund the States, which is contrary to the treaties. While the ECB has an excuse - ensure the future of the euro - the red line will probably be difficult to overcome .http://translate.google.com/translate?sl=fr&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&layout=2&eotf=1&u=http%3A%2F%2Fwww.lemonde.fr%2Feconomie%2Farticle%2F2012%2F07%2F27%2Fplan-concerte-entre-les-etats-et-la-bce-pour-sauver-l-euro_1739159_3234.html

Postal Service Posts Big Loss as Cash Runs Low

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One day this dinosaur will be laid to rest. I just hope we can afford to pay the common men and women (good people) what was promised in retirement. QB


By ERIC MORATH


he U.S. Postal Service on Thursday reported a $5.2 billion quarterly loss and said it was nearly out of cash and likely to exhaust its government credit line in coming months.


The U.S. Postal Service on Thursday reported a $5.2 billion loss for its fiscal third quarter, an indication that the agency's financial woes are deepening. Eric Morath has details on The News Hub. Photo: Getty Images.


The agency said the loss was its widest since it began releasing quarterly financials in 2007. But Postmaster General Patrick Donahoe said the Postal Service would do whatever it takes to maintain its operations, even if that means defaulting on a second multibillion-dollar retiree obligation in as many months.

"We will do everything we need to do to make sure the mail is delivered," he said. "Congress needs to act responsibly and move on this legislation." Losses and defaults will continue, despite cost-cutting efforts, unless Congress passes a postal-overhaul bill, Mr. Donahoe said.

The Postal Service's loss for its third quarter ended June 30 compared with a $3.1 billion loss for the like period a year earlier. Charges taken in connection to a mandate to prefund retiree health care drove the loss in the latest quarter, but declining first-class and advertising mail volume were a drag on revenue.

Mr. Donahoe said the Postal Service would pay its employees and critical vendors but might skip some payments to others.

He said current retirees aren't at risk of losing insurance coverage. While the Postal Service may tap all its credit from the U.S. Treasury by October, finances should improve later in the year with election mail and holiday deliveries propping up revenue, the agency said.

The Postal Service defaulted for the first time in its history on Aug. 1, failing to pay $5.5 billion for future retiree health benefits. A similar $5.6 billion payment is due at the end of next month. The agency said it wouldn't make that either, unless Congress acts.

The Senate passed postal-overhaul legislation earlier this year, but the House hasn't take up the bill or a plan drafted by Republicans.

"I'm not sure how much more evidence leaders in the House of Representatives need before they realize that the Postal Service is in dire straits," said Sen. Tom Carper (D., Del.), one of the Senate bill's authors.

A spokesman for the House Oversight and Government Reform Committee said no date has been set to take up the legislation.

The Postal Service has criticized the Senate plan for not going far enough. For example, the bill makes it difficult for the Postal Service to implement its plan to cut delivery to five days a week to reduce costs.
http://online.wsj.com/article/SB10000872396390443404004577578962471350218.html?mod=googlenews_wsj

J.C. Penney Rises After CEO Says Overhaul Is ‘On Track’

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If you fire all you full time staff and get rid of benefits your profits will rise right? 
This story is full of contradictions and corporate BS. QB

"Second-quarter revenue slid 23 percent to $3.02 billion, the company said today." The company’s gross margin narrowed to 33.2 percent from 38.3 percent a year earlier. Retail cannot survive on margins like that So what will they do? "announced more than 1,000 job cuts to reduce expenses and last month said 350 positions would be cut at the company’s headquarters." That solves everything right? Fire people and downsize. I would not be holding any JCP at this time. QB


J.C. Penney Co. (JCP) rose the most in more than six months after Chief Executive Officer Ron Johnson said his overhaul of the department-store chain is “on track” amid quarterly losses and plunging sales.J.C. Penney climbed 5.9 percent to $23.40 at the close in New York, the biggest one-day gain since Jan. 26. Before Johnson’s remarks, the shares dropped as much as 12 percent as the company posted a $147 million second-quarter loss and said it wouldn’t meet its profit forecast for the year.Enlarge imageJ.C. Penney said it no longer expects to meet its previously issued profit forecast for its fiscal 2012. Photographer: Daniel Acker/Bloomberg
1:42Aug. 10 (Bloomberg) -- Bloomberg's Sheila Dharmarajan reports that J.C. Penney CEO Ron Johnson acknowledges mistakes made in pricing and marketing as he spoke today on the company’s earnings call. J.C. Penney reported a second-quarter loss wider than expected and cut its annual profit forecast. She speaks on Bloomberg Television's "In The Loop."Johnson, the former Apple Inc. (AAPL) retail chief who joined as CEO in November, is tweaking his pricing strategy after the previous plan confused customers by reducing sales events and coupons. Second-quarter revenue slid 23 percent to $3.02 billion, the company said today. That trailed analysts’ $3.18 billion average estimate for the lowest quarterly sales since at least 1989, according to data compiled by Bloomberg.“I’m completely convinced that our transformation is on track,” Johnson told analysts and investors at a presentation today inNew York. When unveiling plans for the overhaul in January, “we said this would be a really tough year. Somehow, I don’t think that message got through.”

Annual Forecast

On Jan. 26, the company said profit excluding some items would meet or exceed $2.16 a share this year on Johnson’s turnaround plan. The forecast topped analysts’ estimates and sent the shares surging the most since at least 1980 that day. Today, the company said it no longer expects to meet that forecast, which was reiterated in May, and didn’t provide a new projection, saying it will plan for similar trends as the past two quarters.Investors and analysts had high expectations after the Jan. 26 presentation as Johnson said the retailer wouldn’t provide the annual forecast if it didn’t have “extraordinary confidence we could meet or exceed.” Chief Operating Officer Mike Kramer said in the same presentation the management team is “not going to commit to anything that we’re not confident we can hit.”The fiscal second-quarter net loss of 67 cents a share compares with net income of $14 million, or 7 cents, a year earlier, the Plano, Texas-based company said in a statement. Excluding some items, the loss was 37 cents a share. The average estimate of nine analysts surveyed by Bloomberg was for a 14- cent loss.

Outlet Exit

Part of the sales decline was due to the retailer exiting its outlet business, J.C. Penney said. Sales also were hurt by a cut in marketing in July as the company adjusted its pricing strategy and outlined its back-to-school shopping strategy, J.C. Penney said.Comparable-store sales fell 22 percent in the quarter while Internet sales plummeted 33 percent to $220 million.The stock started to rise after Johnson’s presentation based on his conviction in the new store model and willingness to make changes, said Steven Kiel, the founder of Annandale, Virginia-based Arquitos Capital Management LLC, which holds J.C. Penney shares.“They have plenty of cash, there’s no reason why they don’t have six to nine months to a year to actually see all of this working,” Kiel said in a telephone interview.J.C. Penney is switching to a two-tiered pricing system of everyday low prices and clearance items and has said it would promote price matching for the first time. The previous strategy had three tiers, consisting of regular prices, monthlong sales on seasonal items and two “best prices” promotions each month, which Johnson said today was confusing.

Alienated Customers

http://www.bloomberg.com/news/2012-08-10/j-c-penney-loss-is-larger-than-estimated.html

Also from the Disciplined Investor 

Corn: Important Considerations We Are Watching

August 10, 2012 2:41 pm

We are watching corn pricing closely as it has a direct effect on the profitability of many companies. It also will be important when considering the cost of gasoline at the pumps.
In particular, we are interested as we are long a few of the poultry distributors as mentioned HERE and short Buffalo Wild Wings.

The crop report (view report) was bullish for corn today, but not as bullish as some expected. Initially corn futures popped on the release at 8:30am, but has since come down 4% from that level.

Earlier this morning, we posted a video of the levels to watch from TAS Professional.
Here are a few more charts to consider.
http://www.thedisciplinedinvestor.com/blog/2012/08/10/corn-important-considerations-we-are-watching/?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+thedisciplinedinvestor%2FEBHR+%28The+Disciplined+Investor%29

Euro-Area Crisis Has ‘No Obvious End In Sight,’ BOE’s King Says

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Bank of England Governor Mervyn King said the U.K. must press on with reforms to the banking industry and repeated his gloomy outlook for the euro-area debt crisis, which is impeding Britain’s economy.“If the rest of the world were growing normally, the rebalancing and recovery of our economy would be much easier,” King wrote in an article in the Mail on Sunday newspaper, published today. “But it isn’t. Even the rapidly expanding emerging-market economies are slowing, and the problems of the euro area continue with no obvious end in sight.”Enlarge imageBank of England Governor Mervyn King said the U.K.’s long-term economic performance will depend on measures such as “reforming our banking system so that banks focus less on making money in the short term, and more on building businesses to serve their customers.” Photographer: Chris Ratcliffe/BloombergKing’s comments come days after the Bank of England cut its U.K. growth forecasts and said the outlook is “unusually uncertain.” The central bank is in the middle of a 50 billion- pound ($78 billion) four-month program of bond purchases and has left the door open to more stimulus for the economy if needed.King, a sports fan who attends the Wimbledon tennis tournament every year, pointed to the success of London’s Olympic Games and said achievements such as winning a gold medal take “years of hard work.”He said the U.K.’s long-term economic performance will depend on measures such as “reforming our banking system so that banks focus less on making money in the short term, and more on building businesses to serve their customers.”“The government’s plans to build a wall between banks’ risky trading on one side, and their lending to businesses and families on the other, will help,” King said. “As will the injection of new competition into our banking system. And, as recent scandals have shown, banks could learn a thing or two about fair play from the Olympic movement.”

BOE Succession

http://www.bloomberg.com/news/2012-08-12/euro-area-crisis-has-no-obvious-end-in-sight-boe-s-king-says.html

Merkel Returns To Crisis As Leaders Squabble Over Bond Purchases

German Chancellor Angela Merkel returns to the front line of the European debt crisis this week as the bloc’s leaders squabble over measures including bond purchases to relieve concerns the single currency may fragment.Merkel ends her summer vacation and travels to Canada Aug. 15-16 for talks with Prime Minister Stephen Harper as a spiraling euro crisis threatens to constrain the global economy. With the region’s leaders awaiting a German high court decision on bailout funding next month, they’re struggling to smooth divisions over a European Central Bank plan to buy the bonds of indebted nations.“It makes no sense for the ECB to start financing” Spain and Italy, ECB Governing Council member Luc Coene said in an interview with newspapers De Tijd and L’Echo published on Aug. 11. “It would only lead to the ECB taking on the whole public debt of Spain and Italy onto its balance sheet.”ECB President Mario Draghi suggested earlier this month the central bank could purchase sovereign debt alongside euro-area bailout funds. While the plan offered Europe an initial respite from the turmoil, Spanish and Italian yields climbed last week on concern that a debt-purchasing program won’t be sufficient to curb the crisis. Concern over the euro may compound flagging global growth following reports last week that China’s exports and industrial production slowed.Spanish two-year note yields last week posted a first weekly gain since the five days ended July 20, while the Italian two-year rate also climbed. The euro slid from a monthly high against the U.S. dollar of $1.2444 on Aug. 6, closing the week at $1.2289.

Divided ECB

http://www.bloomberg.com/news/2012-08-12/merkel-returns-to-crisis-as-leaders-squabble-over-bond-purchases.html

Apple’s Jobs Confronted Samsung Over Galaxy, Witness Says

Aug. 11 (Bloomberg) --Steve Jobs, Apple Inc. (AAPL)’s late co- founder, confronted Samsung (005930) Electronics Co. executives in 2010 after the South Korean company introduced its Galaxy smartphone, Apple’s patent licensing director testified.Boris Teksler, director of patent licensing and strategy, was called as a witness yesterday in Apple’s multibillion-dollar intellectual property trial against Samsung in federal court in San Jose, California. He said Apple made a presentation to Samsung executives in August 2010 intended to warn the company against copying the iPhone.“We were quite shocked,” he said. “They were a trusted partner of ours and we didn’t know how a trusted partner would build a product like that.”Apple sued Samsung in April 2011. Apple and Samsung are the world’s largest makers of the high-end handheld devices that blend the functionality of a phone and a computer. The trial is the first before a U.S. jury in a battle being waged on four continents for dominance in a smartphone market valued by Bloomberg Industries at $219.1 billion.While the companies are bound by lucrative commercial ties, each is trying to convince jurors that its rival infringed patents covering designs and technology.During cross-examination, Teksler confirmed that he wasn’t at the August 2010 meeting. He also acknowledged that at least five of the seven Apple patents at issue in the trial didn’t appear on a list Apple identified to Samsung in the 2010 presentation.

Utility Patents

http://www.bloomberg.com/news/2012-08-11/apple-executives-were-shocked-by-samsung-galaxy-witness-says.html

Spanish commercial Property on the brink

The Spanish and Italian commercial property markets have all but collapsed with the number of transactions in both countries falling more than 90 per cent in the three months to July as investors worry about the future of the eurozone.
Only three property transactions were registered in Spain during the second quarter, down from 58 deals in the previous quarter. In Italy the slide was even more pronounced, with just two buildings being traded during the period, down from 56, according to data from Real Capital Analytics.
http://www.ft.com/intl/cms/s/0/96705c5a-e2ea-11e1-bf02-00144feab49a.html#axzz23NJLvHtF

Euro Zone Economy Shrinks, Darkening Outlook

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By ALEX BRITTAIN

The euro zone's two largest economies avoided shrinking between April and June, but the resilience of Germany and France wasn't enough to prevent the currency bloc's economy as a whole from falling back into contraction. Dow Jones's Jenny Paris discusses. Photo: Getty Images

The euro zone's two largest economies avoided shrinking between April and June, but the resilience of Germany and France wasn't enough to prevent the currency bloc's economy as a whole from falling back into contraction.

Euro-zone economic output fell 0.2% in the second quarter from the first, the European Union's statistics agency Eurostat said Tuesday. That is in line with economists' forecasts in a Dow Jones Newswires poll. Output fell 0.4% year-to-year, again matching expectations.

The decline, which follows zero growth in the first three months of the year, is likely to make it harder for euro-zone leaders to end the fiscal crisis which has forced several member states to request financial aid and raised questions about the bloc's ability to survive in its current form. Rising unemployment and falling consumer and business confidence could worsen public finances in many countries, pushing back debt-reduction targets and heightening concern among investors.

Growth in Germany and stagnation in France—performances that were both better than economists had expected—prevented a steeper decline in euro-zone output in the period. But with signs growing that these two core economies will struggle during the rest of the year, the prospects for the euro-zone as a whole look set to deteriorate.

http://online.wsj.com/article/SB10000872396390444318104577588483371390156.html



Bert Dohmen: Coming Up−The Buying Opportunity of a Lifetime in Gold

Also, Ryan Puplava with this week’s Market Wrap-up and Rob Bernard with the Fixed Income ReportBIG PICTURE08/11/2012

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RealPlayer WinAmp Windows Media MP3James J Puplava CFP with Ryan Puplava CMT, Bert Dohmen, and Robert BernardSponsored by: PFS GroupJim is pleased to welcome back Bert Dohmen from Dohmen Capital and The Wellington Letter this week. Bert believes that we are coming up on a tremendous buying opportunity in the gold market as he sees much higher prices longer term. He also believes the general market is very difficult to short, as the risk-on, risk-off trades, and increased volatility make shorting very difficult. Ryan Puplava checks in with the week’s Market Wrap-up, Rob Bernard discusses bonds and interest rates in the Fixed Income Report and Jim will take your q-calls this segment.Ryan Puplava joined PFS Group in 1995. He is Senior Trading Manager and works closely with Jim Puplava on PFS Group's Growth investment objective. He also contributes a monthly Market Observation to Financial Sense and co-authors In the Know—a weekly communication for Jim Puplava's clients only—with other members of the trading staff.http://www.financialsense.com/financial-sense-newshour/big-picture/2012/08/11/01/r-puplava-b-dohmen-r-bernard/buying-opportunity-of-a-lifetime-in-gold

Which Way Will the Pendulum Swing for Gold?

One of the most fascinating aspects when watching a sporting event like the Olympics is the historical statistics highlighting the tremendous advances in athleticism over the years. In the spirit of the events this summer, BTN Research compared gold’s advancement from the beginning of the games in Beijing to the London Olympics.On the day of China’s auspicious opening ceremonies on August 8, 2008, gold was $857.80 an ounce. By the time the world watched the opening ceremonies of the 2012 London Summer Olympic Games, the precious metal had climbed to $1,617.90 an ounce. This represents a remarkable increase of 89 percent in four years.Athletes are often asked if they can keep improving their outstanding performance; I’m asked if gold can continue climbing. As I like to remind investors, gold isn’t always on an upward path. When looking at the average monthly returns over the past decade, you can see that short-term setbacks are normal throughout the year. The yellow metal has historically declined in value in March and June; gold stocks see much greater fluctuations from month-to-month.http://www.financialsense.com/contributors/frank-holmes/which-way-will-the-pendulum-swing-for-gold

By DAVID WINNING And ROBB M. STEWART

SYDNEY—Rio Tinto RIO.AU -0.14% PLC is cutting jobs at its regional headquarters in Melbourne and closing an office in Sydney as the Anglo-Australian mining giant moves to contain costs, two people familiar with the matter said Tuesday.

The restructuring is the latest sign that Australia's mining boom is running out of steam as China's economy slows and Europe struggles to resolve its debt crisis. Resources companies are showing increasing caution about the timing of any recovery in demand and commodity prices—an approach demonstrated by BHP Billiton Ltd.'s BHP +0.11%shutting a coal mine in Queensland state and Rio Tinto's putting another under review.

David Peever, Rio's managing director for Australia, recently told staff in internal emails that some roles in Melbourne will be cut while other workers will be transferred to offices in Perth and Brisbane, one of the people said.

Melbourne will remain a corporate head office for Rio Tinto, but is to be scaled back, the person said.

An office in Sydney where about 30 people work will be closed, the person said, with Rio Tinto turning to leased serviced offices when it needs a presence in the city.

Mining companies are being forced to review their expansion plans and tackle rising operating costs as commodity prices continue to weaken amid concerns over demand from key consumers such as China. Companies operating in Australia have also struggled with the strength of the local currency against the U.S. dollar, the currency in which they operate.http://online.wsj.com/article/SB10000872396390444860104577560401398644984.html