Weekend Cocktail Chatter

Weekend Cocktail Chatter

Weekend Cocktail Chatter

Moneybox
Commentary about business and finance.
April 29 1999 5:30 PM

Weekend Cocktail Chatter

Here's what happened this week: Amazon.com and eBay went up a lot; then eBay reported earnings that were great, but its stock still went down; then AOL--whose stock had run up and then fallen back--reported great earnings, and its stock got crushed; and in the meantime money was rushing out of technology stocks and into cyclical stocks again, and AT&T made a bid for MediaOne, and Ken Chenault was named the new CEO at American Express, and Disney said its earnings fell 41 percent in the last quarter from a year ago, and the Employment Cost Index rose a measly 0.4 percent in the first three months of the year, and Amazon reported great numbers but its stock was absolutely slammed, and the Consumer Confidence Index rose again, and the Dow kept going up as the NASDAQ kept going down. And Boeing announced it was thinking about building a really big jet.

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OK, you're all caught up. On to the Chatter!

1. "American Family Enterprises, the magazine sweepstakes giant, is expected to lose $30 million this year, and Time, which owns half of the company, is said to be contemplating putting AFE into Chapter 11. If that happens, will I never again get the chance to win $1 million and subscribe to Knitting Today all at once?"

2. "From Suze Orman's The Courage to Be Rich, a brilliant parody of self-help and investing books: 'The less self-esteem you have, the more debt you create.' I'm telling you, this woman's satirical genius is positively Swiftian."

3. "At Monday's G-7 meeting, Treasury Secretary Robert Rubin made it very clear to European and Japanese finance ministers and central bankers that the U.S. cannot continue to be the sole engine driving the world economy and buying all the goods everyone else is making. In response, the assembled finance ministers said, 'Well, OK. But why not?'"

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4. "The G-7 also issued a communiqué that Japan, which remains mired in recession, should use 'all available tools' to stimulate the economy until growth returns. Of course, Japanese Prime Minister Miyazawa then explained that no one should interpret this to mean that Japan would be taking any more steps toward stimulus. ... Oh, my mistake. I guess I got confused by the 'all available tools' and 'until growth is restored' lines. I thought that meant Japan would use all available tools until growth was restored. Silly me."

5. "According to the New York Times, Dow Jones, which owns the Wall Street Journal, 'is introducing dowjones.com, a free site for business users.' What, exactly, does that mean? Is the site free for you only if you work at a business? Do you have to give proof of employment before using the site? Do you only have to pay if you're unemployed?"

6. "AT&T announced that it was making an unsolicited $58 billion bid for cable operator MediaOne, a deal that would make Ma Bell--excuse me, Ma Cable--the largest cable company in the world. Of course, there are all sorts of regulatory roadblocks to get around, but you have to like CEO Michael Armstrong's ambition. Of course, he could just be a huge fan of The Sopranos."

7. "Iridium, the global satellite telephone company, has been catching flak from customers trying to use the phones from Kosovo. The customers, who are paying a remarkable $3 a minute or more, say that calls get dropped all the time, that connecting is difficult, and that you can't use the phones inside buildings. Iridium's response has basically been: 'If the phones aren't working right, it's because the customers are boneheads.' Now that's a strategy Dale Carnegie would have been proud of."