The trade deficit is soaring, the dollar is weakening against the yen, oil prices are high. Damn, it feels like the 1980s all over again. Except that inflation is still nonexistent, corporate earnings are high, the Japanese economy is still barely limping along, and the trade deficit seems to have more to do with roaring consumer demand and foreign demand for U.S. assets than any fundamental weakness in the overall economy. Maybe the fact that all this is going on at once explains this market’s complete unwillingness to commit in one direction or another. Or maybe enough people just haven’t read Dow 36,000 yet. On to this week’s Cocktail Chat.
1. “Mindspring and Earthlink agreed to merge, in a deal that would make the new company the second largest Internet service provider in the world, after AOL. Of course, the real question is not whether the two corporate cultures will mesh. Unfortunately, the new company will be called Earthlink, robbing us of the chance to have a firm called Mindearthspringlink, which would have been cool.”
2. “Federal Reserve governor William McDonough reiterated that, as part of the Fed’s attempt to ensure that fears about Y2K won’t cause any liquidity problems, the Fed would be adopting a ’no questions asked’ policy at the window where it lends money to banks. Not even: ‘Will you pay us back?’ Is there any chance at all that Russian tycoons are not figuring out how to take advantage of this?”
3. “In its first day of trading, Internet stock E.piphany saw its shares leap more than 150 percent. I’m sure the company is really just terrific, but could its name be more s.tupid?”
4. “E.piphany’s popularity is due in part to the fact that it’s involved in today’s hottest technology sector, namely business-to-business e-commerce. First we had content, then portals, then e-commerce, then free e-mail, then business-to-consumer e-commerce again, and now it’s business-to-business that’s all the rage. Next, presumably, will be computer-to-computer commerce, which will have the great virtue of eliminating humans entirely. Another alternative would be business-to-aliens commerce.”
5. “From the Ripley’s Believe It or Not file, this headline from the Wall Street Journal: ‘Once Just Seat-Pocket Promotions, In-Flight Magazines Find Devotees.’ Look, there were actually people who watched Dear John, too. Incredibly bad taste is just not news.”
6. “Florida’s attorney general filed a lawsuit against Rite-Aid, alleging that the company systematically overcharged uninsured patients for prescription drugs. When asked about the lawsuit, a spokeswoman for Rite-Aid said, ‘I don’t know anything about it.’ This is not the ideal response from a company flack. ‘The charges are utterly without merit, and the lawsuit is baseless’ would have been better. ‘I don’t know anything about it’ sounds more like ‘I didn’t know anything about it while it was going on.’”
7. “New Web site Space.com named former astronaut Sally Ride as president, ensuring that for the foreseeable future every article about the site will contain at least one reference to the company’s ‘rocketing’ fortunes.”
