HER NEXT GIG
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IPO INTERRUPTUS JOB ON THE LINE?
■ Citigroup’s Krawcheck may soon leave the troubled bank
■ After Blackstone, little interest in private equity
■ Bear’s CEO may be next Wall Street executive to depart
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■ Best places to get an Apple martini
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businessnow
WEDNESDAY DEC. 5, 2007
Volume 1 / Issue 1
THE MARKETS YESTERDAY
DJIA S&P 500 Nasdaq Russell 2000 Nikkei Euro. stocks Treasuries Crude oil Dollar vs. Euro
12,799 -1.62% 1,417 -1-59% 2,562 -1.33% 755 -1.20% 14,889
0.34%
355.78 -0.20% 1 4/32
- 1/16
$98.18
$4.34
$.675 -0.20%
TODAY ■ The Labor Department announces jobless claims. Some 250,000 Americans are expected to file for benefits. 2:30 ET
■ General Electric releases Q3 earnings. Net may jump 20% to 60 cents per share. 7:30 ET ■ The Bureau of Labor Statistics is expected to report a 0.4% rise in inflation. 4:00 ET
Wall Street payouts head for 3-year low ‘09 will be ‘a massacre’ By Peter Pae Business Now Staff Writer
he mortgage crisis will hit the city’s financial workers where it hurts next month, when investment banks hand out bonus checks that will be the lowest since 2004. The average payout expected— of almost $104,000—is about twice what the average New York city household makes in a year. But it is well off the high of $137,000 set in 2006. The worst is yet to come. With mortgage-related write-offs continuing into the first half of next year, bankers may be looking at a whopping 60% cut in their bonus
T
checks come Christmas 2008, analysts said. “From the perspective of these guys, it’s going to be a massacre,” said executive recruiter Alan Johnson. Profit at American Airlines, the nation's largest carrier, jumped more than tenfold to $175 million in the third quarter while Delta Air Lines, the thirdlargest, said net income quadrupled to $220 million compared with the year-earlier period. Profit would have been higher if not for rising fuel costs. The results elated investors but fueled anger among consumer groups.
Lehman bucks trend By Peter Pae Business Now Staff Writer
Call it luck or call it foresight, but Lehman Brothers Holdings may be about to bypass some bigger investment banks in stature. The firm’s announcement yesterday of a 7 percent increase in fourthquarter profit showed it has avoided the mortgage underwriting excesses that have traumatized most of its peers.
Analysts credited Lehman chief Richard Fuld for keeping his firm focused on trading and merger advice. “Pound for pound, Fuld is outperforming Blankfein,” said Credit Suisse analyst Susan Katzke, referring to Goldman Sachs CEO Lloyd Blankfein. Lehman shares jumped $7 to $69.45 after the firm released its results, which included a 16% rise in quarterly revenue, to $15.3 billion.
Less to go around $137K
Average bonuses paid by Wall Street banks
$113K
$104K
$92K $72K
$42K
‘03
04
‘05
‘06
‘07
‘08
Source: NYC Comptroller (for 2003-2006), Johnson Associates (for estimates)
■ THE ECONOMY
Fed trims forecast for 2008 By Tony Carter Business Now Staff Writer
CEO Fuld says profits may rise another 30% next year
The Federal Reserve yesterday lowered its forecast for the economy in 2008, saying gross domestic product could grow by as little as 1.6%. That is sharply lower than the minimum 2.5% growth rate the Fed was forecasting this summer, and raised hope among investors for a late-year
interest-rate cut. The results elated investors but fueled anger among consumer groups. "I'm aghast there isn't more public outcry over this," said Kate Hanni, president of the Coalition for an Airline Passengers' Bill of Rights, a consumer advocacy group based in Napa Valley. "They're making money hand over fist at the expense of passengers."
2/ December 5, 2007 businessnow
What’s Ahead
The Tally ■ Wall St. Payouts Crater
With their companies still mired in the mortgage mess, most investment bankers can expect two years of lower payouts. The real pain will be felt a year from now, when bonuses are expected to be about a third of what they were at their height in 2006. “It’s going to be a massacre,” said executive recruiter Alan Johnson. Page 1
■ Fed Trims '08 Forecast
The Federal Reserve lowered its forecast for the economy in 2008, saying gross domestic product could grow by as little as 1.6%. That is sharply lower than the minimum 2.5% growth rate the Fed was forecasting this summer and raised hope among investors for a late-year interest-rate cut. Page 1
U.S. growth 3.6%
‘04
3.1%
‘05
2.9%
2.7%
‘06
‘07
Source: Department of Commerce
1.6%
‘08
*2007 and 2008 are estimates
■ Holiday Sales Uncertain
Negative forecasts by discounter Target Inc. and Limited Brands, which owns Victoria Secret, may presage the first decline in holiday sales in four years, analysts said. Apple bucked the trend, saying sales of its iPods, iPhones and Macintosh computers
were accelerating and would give the company its first $10 billion sales quarter ever. Bloomberg
■ H&R Block Ousts Chief
Mark Ernst left as chief executive 2 1/2 months after shareholders backed a slate of dissident board members. To replace Ernst, the tax preparation company tapped Richard Breeden, one of the newly elected board members and a former chairman of the Securities and Exchange Commission. AP
■ Crude Oil Hits a Record
Oil futures settled at a record $98.03 a barrel and appear poised to push past the $100 mark. Prices jumped after forecasters predicted a frigid winter in the Northeast. Page 3
■ Murdoch’s ambitions
News Corp.’s chief was alone earlier this year in seeing Dow Jones as a steal for $5 billion. At an investor conference in New York today, he will outline his plans for integrating the Wall Street Journal with his other operations, notably the newly launched Fox
Business Network. Page 8
■ Hedge Funds’ Awful Q3
A falloff in performance related to bad mortgage bets caused pension and endowment funds to park their assets in safer places. Hedge fund inflows fell to $45.2 billion, the lowest since the fourth quarter of 2006. Page 5
■ Google to Store MP3s
The search giant is preparing a service that will let consumers store digital music files and video clips on the company’s systems, according to the Wall Street Journal. Google wouldn’t comment, but analysts told the paper that the service would require an investment of $2 billion over 3 years.
■ Abbott’s Stent Approved
The Food and Drug Administration gave preliminary approval to Abbott Laboratories’s drug-coated stent Xience. In documents posted on the FDA’s Web site, the agency said patients using Xience may have a lower risk of heart attack and death than patients using the best-selling U.S. stent, Taxus. Taxus is manufactured by Boston Scientific. Bloomberg News
■ Sears Ups Bid to $267M
Restoration Hardware, the upscale home-furnishing chain, said its board
Thursday Dec. 6 7:45 ET The European Central Bank Governing Council meets to discuss interest rate policy. Most analysts expect the council to leave rates unchanged at 4%.
was “encouraged” by Sears’ sweetened bid of $6.70 a share. The new offer is almost 70% above the $4 a share that Sears offered in October. Sears, which is controlled by the billionaire Edward S. Lampert (pictured), already owns a 13.7% stake in Restoration Hardware. Bloomberg News
Friday Dec. 7
10:00 ET
The University of Michigan releases its consumer confidence index, which has fallen short of expectations for two months running. The index—based on a survey of 500 Americans—is expected to fall to 70 from 75, according to consensus estimates.
■ Building Permits Fall 8%
Monday Dec. 10 10:00 ET
New homebuilding permits slumped to their lowest level in 14 years, indicating the housing slump has yet to reach bottom. Analysts said the decline in residential investment will remove about 1 percentage point from economic growth this quarter. Dow
The Treasury Department holds its auction of four-week bills; heavy demand could give a boost to both the bond and stock markets.
Jones and Bloomberg
The Federal Open Market Committee announces its decision on interest rate policy. Most economists expect the Fed to hold rates steady.
■ Broadway Loses $2M/Day
The New York city comptroller put losses from the strike at $2 million a day, and said hotels and restaurants in the theater district were suffering the most. No talks are scheduled between the producers’ league and the stagehands union, which began the strike three and a half weeks ago. amNewYork
Tuesday Dec. 11 2:15 ET
Weather for Thursday Dec. 6 New York Boston Washington Los Angeles London
42/29; cloudy 45/34; partly cloudy 38/26; snow showers 65/52; ample sun 48/40; rain
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News
businessnow / December 5, 2007 /3
GM going green
EARNINGS ■ Verizon profit beats estimates Gold prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative investment. The price of gold is up 20% this year, heading for its seventh straight annual gain. The dollar fell Thursday to record lows against the euro and against a weighted basket of six major currencies, including the Japanese yen and British pound. Five of the last six bear markets for the U.S. currency sent gold higher in dollar tdelivery this month rose
Part of automaker's bid to boost sales in China By Katty Fenders Business Now staff writer
marking the highest closing price for the most actively traded futures contract since Jan. 22, 1980, the day after gold reached a record $873 an ounce. The gold contract for delivery this month rose $6.60 on Thursday to $764.10.
$1.42 to $42.13 on Thursday and is up 37% this year, compared with an 8.6% rise in the Gold prices rose Standard & Poor's 500 index. to a 27-year Agnico-Eagle Mines Ltd. high after the surged $1.32 to $55.13 and is dollar hit record up 34% this year. lows, boosting But shares of some miners the appeal of the have lagged. Newmont Minmetal as ing Corp., which rose an alternative investcents to $46.14 on Other environmental leaders 81 ment. Thursday, is up just The price of gold is 2% this year. NewCompany What’s It’s Doing mont recently warned up 20% this year, heading for its seventh that it was having difAs part of ‘Economation’ straight annual gain. ficulty replacing deinitiative, is building energy products that The dollar fell Thurspleted reserves. help the environment day to record lows In addition to the against the euro and falling dollar, the risFast-food company against a weighted basing price of oil may pushes more humane ket of six major currenbe leading some instandards for lifestock cies, including the vestors to buy gold. on its suppliers Japanese yen and British That's because the pound. Five of the last metal is viewed as a Adding hundreds of low-polluting hybrid six bear markets for the hedge against inflatrucks to its worldwide U.S. currency sent gold tion. Oil futures delivery fleet higher in dollar terms. climbed Thursday to "It's hard to keep gold a record $89.47 a bardown when the dollar is rel. getting crushed," said Carlos Silver also rallied. Silver fuInvestment in the StreetPerez-Santalla, gold trader and tures for December delivery Tracks Gold Trust, an expresident of Hudson River Fu- climbed 5.3 cents, or 0.4%, to change-traded fund backed by tures in New York. $13.80 an ounce. The metal is bullion, has surged, pushing Gold futures for December up 6.7% this year. the fund's holdings to a record delivery rose $6.40, or 0.8%, Gold's continuing surge is 594 metric tons. The fund beto $768.70 an ounce on the powering a heady bull market gan trading in Novem bbzHB Comex division of the New in some gold mining stocks. hBZh hzBbzHb shdhsd hsd York Mercantile Exchange, Barrick Gold Corp. jumped hsbdhsd ds hsdbhs ber 2004. If
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Oracle closes in on BEA
Oracle CEO Larry Ellison
BEA CEO Alfred Chuang
GM CEO Wagoner expects to sell one million units in China next year
it were a central bank, the fund would be the 11th-largest holder of gold reserves. Some technical analysts say gold may be poised for a decline. "The market continues to be
overbought and essentially correction-free and is thus vulnerable to sharp and quick swings in the opposite direction should adverse news or perceptions hit the trading floors," said Jon Nadler, ana-
Another surge $100
Crude oil prices in New York, 12 months through yesterday
By George Mant Business Now staff writer
Gold prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative investment. The price of gold is up 20% this year, heading for its seventh straight annual gain. The dollar fell Thursday to record lows against the euro and against a weighted basket of six major currencies, including the Japanese yen and British pound. Five of the last six bear markets for the U.S. currency sent gold higher in dollar terms. "It's hard to keep gold down when the dollar is getting crushed," said Carlos Perez-Santalla, gold trader and president of Hudson River Futures in New York. Gold futures for December delivery rose $6.40, or 0.8%, to $768.70 an ounce on the Comex division of the New York Mercantile Exchange, marking the highest closing price for the most actively traded futures contract since Jan. 22, 1980, the day after gold reached a record $873 an ounce. The gold contract for delivery this month rose $6.60 on Thursday to $764.10. Silver also rallied. Silver futures for December delivery climbed 5.3 cents, or 0.4%, to $13.80 an ounce. The metal is up 6.7% this year. Gold's continuing surge is powering a heady bull market in some gold mining stocks. Barrick Gold Corp.
■ P&G sales climb 6%
85 75 65 55
N
D
07
F
M
A
M
J
J
R
S
0
Source: NYMEX
$5 at pump? It could happen By Amanda Walles Business Now staff writer
Gold prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative investment. The price of gold is up 20% this year, heading for its seventh straight annual gain. The dollar fell Thursday to record lows against the euro and against a
weighted basket of six major currencies, including the Japanese yen and British pound. Five of dollar is getting crushed," said Carlos Perez-Santalla, gold trader and presthe last six bear markets for the U.S. currency sent gold higher in dollar terms. "It's hard to keep gold down when the dollar is getting crushed," said Carlos Perez-Santalla, gold trader and president of Hudson River Futures in New York.
Gold prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative investment. The price of gold is up 20% this year, heading for its seventh straight annual gain. The dollar fell Thursday to record lows against the euro and against a weighted basket of six major currencies, including the Japanese yen and British pound. Five of the last six bear markets for the U.S.
■ Bristol Myers profit falls 11% Gold prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative investment. The price of gold is up 20% this year, heading for its seventh straight annual gain. The dollar fell Thursday to record lows against the euro and against a weighted basket of six major currencies, including the Japanese yen and
■ Conagra net surges 25% Gold prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative investment. The price of gold is up 20% this year, heading for its seventh straight annual gain. The dollar fell Thursday to record lows against the euro and against a weighted basket of six major currencies, including the Japanese yen and British pound. Five of the last six bear markets for the U.S. currency sent gold higher in dollar tdelivery this month rose $6.60 on Thursday to $764.10. Silver also rallied. Silver fu-
4/ December 5, 2007 businessnow
Party’s over Blackstone’s busted IPO sours Street on private equity 5 miserable months $40
Blackstone’s shares since June 22 IPO
35 30 25 20
Jun07
Jul07
Aug07
Sep07
By Katty Fenders Business Now staff writer
Blackstone chief Stephen Schwarzman personally sold more than $1 billion worth of stock in the IPO.
Wireless Sharing* | Built-In FM Tuner | 3" Color Screen | 30 GB | $199 *Zune to Zune wireless sharing to devices within range of each other. Share select songs, for up to 3 plays in 3 days. See zune.net for complete details. “Prices are estimated retail prices; actual retail prices may vary.”
Oct07
Nov07
Barrick Gold Corp. jumped $1.42 to $42.13 on Thursday and is up 37% this year, comold prices rose pared with an 8.6% rise in the to a 27-year Standard & Poor's 500 index. high after the Agnico-Eagle Mines Ltd. dollar hit record surged $1.32 to $55.13 and is lows, boosting up 34% this year. the appeal of the But shares of some miners metal as an al- have lagged. Newmont Minternative investment. ing Corp., which rose 81 cents The price of gold is up 20% to $46.14 on Thursday, is up this year, heading for its sev- just 2% this year. Newmont reenth straight annual gain. cently warned that it was havThe dollar fell Thursday to ing difficulty replacing depletrecord lows against the euro ed reserves. and against a weighted basket In addition to the falling of six major currencies, in- dollar, the rising price of oil cluding the Japanese yen and may be leading some investors British pound. Five of the last to buy gold. That's because the six bear markets for the U.S. metal is viewed as a hedge currency sent gold against inflation. higher in dollar terms. Sorry Mr. Oil futures "It's hard to keep Kravis: climbed Thursgold down when the day to a record dollar is getting Window $89.47 a barrel. crushed," said Carlos has Investment in Perez-Santalla, gold the StreetTracks trader and president of closed Gold Trust, an Hudson River Futures for other exchange-traded in New York. fund backed by Gold futures for privatebullion, has December delivery surged, pushing rose $6.40, or 0.8%, equity the fund's holdto $768.70 an ounce IPOs. ings to a record on the Comex divi594 metric tons. sion of the New York The fund began Mercantile Exchange, trading in Novem marking the highest closing bbzHB hBZh hzBbzHb price for the most actively shdhsd hsd hsbdhsd ds hsdbhs traded futures contract since ber 2004. If it were a central Jan. 22, 1980, the day after bank, the fund would be the gold reached a record $873 an 11th-largest holder of gold reounce. serves. The gold contract for delivSome technical analysts say ery this month rose $6.60 on gold may be poised for a deThursday to $764.10. cline. Silver also rallied. Silver fu"The market continues to be tures for December delivery overbought and essentially climbed 5.3 cents, or 0.4%, to correction-free and is thus vul$13.80 an ounce. The metal is nerable to sharp and quick up 6.7% this year. swings in the opposite direcGold's continuing surge is tion should adverse news or powering a heady bull market perceptions hit the trading in some gold mining stocks. floors," said Jon Nadler.ana-
A
PEOPLE Krawcheck looking to leave Citigroup Sallie Krawcheck, who was once seen as a possible successor to former Citigroup CEO Charles Prince, has received several job offers and is expected to leave the bank by the end of the year, sources said. Krawcheck, 45, is being courted by two of the biggest hedge funds on Wall Street, which may be in a position to boost her income far above the $7 million she took home in 2006. Krawcheck’s ascent at Citigroup was rapid; she was the bank’s chief financial officer from 2003 to 2005. But she suffered a setback earlier this year when she was reassigned to head up Citigroup’s brokerage arm, Smith Barney. Krawcheck has told associates she is dismayed by the uncertain management situation at Citigroup, which is being run on an interim basis by Sir Win Bischoff.
■ Four months after Dow Kim quietly left Merrill Lynch amid that company's credit meltdown, he has re-emerged as the managing director of Hegedus LLC, a London-based hedge fund with $6 billion in assets.
■ Michael Collins joined Wachovia as head of the Corporate Equity Derivatives Origination team. He was previously head of European sales for UBS Securities.
■ Jessica Bibliowicz, the chief executive of brokerage firm National Financial Partners, joined the board of Charles Schwab Corp.
■ Lisa Monaco has joined Sanford Bernstein as an analyst covering media companies. Last month, she was fired by Morgan Stanley after Morgan said it was halting coverage of newspaper companies.
■ Robert T. Ryan was appointed to the Citigroup board of directors eight months after retiring from stent maker Medtronic. ners, joined the board of Charles Schwab Corp.
businessnow / December 5, 2007 /5
Hedge funds’ terrible Q3
Funds’ slowdown Money taken in by hedge funds $60B
Money slows as investment returns dip—a sign that credit crunch is having a wider impact
$58.7B By Katty Fenders business Now staff writer
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■ Untouchable: Despite his hefty fees, hedge-fund king James Simons of Renaissance Technologies attracted at least $600 million in new money in the quarter.
old prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative invest-
ment. The price of gold is up 20% this year, heading for its seventh straight annual gain. The dollar fell Thursday to record lows against the euro and against a weighted basket of six major currencies, including the Japanese yen and British pound. Five of the last six bear markets for the U.S. currency sent gold higher in dollar terms. "It's hard to keep gold down when the dollar is getting crushed," said Carlos PerezSantalla, gold trader and president of Hudson River Futures
in New York. Gold futures for December delivery rose $6.40, or 0.8%, to $768.70 an ounce on the Comex division of the New York Mercantile Exchange, marking the highest closing price for the most actively traded futures contract since Jan. 22, 1980, the day after gold reached a record $873 an ounce. The gold contract for delivery this month rose $6.60 on Thursday to $764.10. Silver also rallied. Silver futures for December delivery
climbed 5.3 cents, or 0.4%, to $13.80 an ounce. The metal is up 6.7% this year. Gold's continuing surge is powering a heady bull market in some gold mining stocks. Barrick Gold Corp. jumped $1.42 to $42.13 on Thursday and is up 37% this year, compared with an 8.6% rise in the Standard & Poor's 500 index. Agnico-Eagle Mines Ltd. surged $1.32 to $55.13 and is up 34% this year. But shares of some miners have lagged. Newmont Mining Corp., which rose 81 cents
to $46.14 on Thursday, is up just 2% this year. Newmont recently warned that it was having difficulty replacing depleted reserves. In addition to the falling dollar, the rising price of oil may be leading some investors to buy gold. That's because the metal is viewed as a hedge against inflation. Oil futures climbed Thursday to a record $89.47 a barrel. Investment in the StreetTracks Gold Trust, an exchange-traded fund backed by bullion, has surged, pushing the fund's holdings to a record 594 metric tons. The fund began trading in Novem bbzHB hBZh hzBbzHb shdhsd hsd hsbdhsd ds hsdbhs ber 2004. If it were a central bank, the fund would be the 11th-largest holder of gold reserves. Some technical analysts say gold may be poised for a decline.
$45.2B $15.8B Q4 ‘06
Q1 ‘07
Q2 ‘07
Q3 ‘07
Source: Hedge Fund Research Inc.
"The market continues to be overbought and essentially correction-free and is thus vulnerable to sharp and quick swings in the opposite direction should adverse news or perceptions hit the trading floors," said Jon Nadler, analyst at Kitco Minerals & Metals Inc. in Montreal. But Richard O'Brien, chief executi hgxhzxgzxhgxfgzxfgz rection should adverse news or
percemont Mining, said he expected gold to move even higher, though he didn't say how high. "It still has room to run," he said. "Prices seem in line with indications they will go up further." "The market continues to be overbought and essentially correction-free and is thus vulnerable to sharp and quick swings in the opposite direction should adverse news
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6/ December 5, 2007 businessnow
Company News BRIEFS ■ Hertz Profit Rises
Apple CEO Steve Jobs with the iPhone in June
iPhone sales surge By Katty Fenders Business Now staff writer
old prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative investment. The price of gold is up 20% this year, heading for its seventh straight annual gain. The dollar fell Thursday to record lows against the euro and against a weighted basket of six major currencies, including the Japanese yen and
British pound. Five of the last six bear markets for the U.S. currency sent gold higher in dollar terms. "It's hard to keep gold down when the dollar is getting crushed," said Carlos Perez-Santalla, gold trader and president of Hudson River Futures in New York. Gold futures for December delivery rose $6.40, or 0.8%, to $768.70 an ounce on the Comex division of the New York Mercantile Exchange, marking the highest closing
Kellogg boosts ads old prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative investment.The price
down when the dollar is getting crushed," said Carlos Perez-Santalla, gold trader and president of Hudson River Futures in of gold is up New York. 20% this year, heading for its Gold futures for seventh straight December delivery annual gain. rose $6.40, or 0.8%, The dollar fell to $768.70 an Thursday to record ounce on the lows against the Comex division of euro and against a the New York weighted basket of Mercantile Exsix major currenchange, marking cies, including the the highest closing Sales of cereals have price for the most Japanese yen and British pound. Five of fallen 4% this year actively traded futhe last six bear martures contract since kets for the U.S. currency Jan. 22, 1980, the day after sent gold higher in dollar gold reached a record $873 terms. an ounce. "It's hard to keep gold The gold contract for de-
Lear $2B debt sale old prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative investment. The price of gold is up 20% this year, heading for its seventh straight annual gain. The dollar fell Thursday to record lows against the euro and against a weighted basket of six major currencies, including the Japanese yen and British pound. Five of the last six bear markets for the U.S. currency sent gold higher in
dollar terms. "It's hard to keep gold down when the dollar is getting crushed," said Carlos Perez-Santalla, gold trader and president of Hudson River Futures in New York. Gold futures for December delivery rose $6.40, or 0.8%, to $768.70 an ounce on the Comex division of the New York Mercantile Exchange, marking the highest closing price for the most actively traded futures contract since Jan. 22, 1980, the day after
Third-quarter profit rose 51 percent after the rental-car company eliminated jobs and increased prices. Third-quarter profit rose 51 percent after the rental-car company eliminated jobs and increased prices. quality, a Goldman Sachs report said. The report, which was accompanied by a "buy" recommendation, helped Dell's shares climb almost 6%.
■ RadioShack Jumps Shares of RadioShack rose 4.1%, the most in a month, after the electronics chain said it would shut stores that aren't performing well. The company also said it returned to profitability and predicted it would remain in the black for each quarter of 2008.
■ Office Depot Sets Accounting Review Office Depot Inc. the world's second-largest office supplies chain, said it may have provided misleading information about its finances. Its shares fell 15% and the company said its chief financial officer resigned.
■ Dell Turnaround Bearing Fruit After two years of struggle, the computer maker is succeeding in cutting costs and in restoring its reputation for quality, a Goldman Sachs report said. The report, which was accompanied by a "buy" recommendation, helped Dell's shares climb almost 6%.
■ Leukemia Drug Is Approved Novartis AG won U.S. approval of Tasigna, a drug to treat leukemia in patients who no longer respond to the company's best-selling cancer medicine Gleevec. The company also said it returned to profitability and predicted it would remain in the black for each quarter of 2008. quality, a Goldman Sachs report said. The report, which was accompanied by a "buy" recommendation, helped Dell's shares climb almost 6%.
■ Bear Slashes Jobs The securities firm said it will eliminate 300 positions in its fixed-income group and said it expected losses in that unit to continue through at least the middle of next year. The company also said it returned to profitability and predicted it would remain in the black for each quarter of 2008. quality, a Goldman Sachs report said.ch was acbuy" recommendation, helped Dell's shares climb almost 6%.
8 / December 5, 2007 businessnow
Rupert’s to-do’s News Corp. chief must accomplish some big things in 2008. Here’s what investors will be tracking. By Kelly Franchelly Business Now staff writer
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old prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative investment. The price of gold is up 20% this year, heading for its seventh straight annual gain. The dollar fell Thursday to record lows against the euro and against a weighted basket of six major currencies, including the Japanese yen and British pound. Five of the last six bear markets for the U.S. currency sent gold higher in dollar terms. "It's hard to keep gold down when the dollar is getting crushed," said Carlos Perez-Santalla, gold trader and president of Hudson River Futures in New York. Gold futures for December delivery rose $6.40, or 0.8%, to $768.70 an ounce on the Comex division of the New York Mercantile Exchange, marking the highest closing price for the most actively traded futures contract since Jan. 22, 1980, the day after gold reached a record $873 an ounce. The gold contract for delivery this month rose $6.60 on Thursday to $764.10. Silver also rallied. Silver futures for December delivery climbed 5.3 cents, or 0.4%, to $13.80 an ounce. The metal is up 6.7% this year.
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Integrate the Wall Street Journal. Murdoch was alone in seeing Dow Jones as a steal for $5 billion. It's up to him to show the world he was right. Boost audience for Fox Business Network. Murdoch elbowed his way into cable news. Business is the next battleground. Rejuvenate MySpace. Social networking is a high-stakes game and Facebook is catching up. Murdoch needs to recover the momentum—fast.
Gold's continuing surge is powering a heady bull market in some gold mining stocks. Barrick Gold Corp. jumped $1.42 to $42.13 on Thursday and is up 37% this year, compared with an 8.6% rise in the Standard & Poor's 500 index. Agnico-Eagle Mines Ltd. surged $1.32 to $55.13 and is up 34% this year. But shares of some miners have lagged. Newmont Mining Corp., which rose 81 cents to $46.14 on Thursday, is up just 2% this year. Newmont recently warned that it was having difficulty replacing depleted reserves. In addition to the falling dollar, the rising price of oil may be leading some investors to buy gold. That's because the metal is viewed as a hedge against inflation. Oil futures climbed Thursday to a record $89.47 a barrel. Investment in the StreetTracks Gold Trust, an exchange-traded fund backed by bullion, has surged, pushing the fund's holdings to a record 594 metric tons. The fund began trading in Novem bbzHB hBZh hzBbzHb shdhsd hsd hsbdhsd ds hsdbhs ber 2004. If it were a central bank, the fund would be the 11th-
Foreign Business BRIEFS ■ Japan's Booming Retail Sales Japan's retail sales unexpectedly rose for a second month in September as lingering summer heat spurred demand for cold drinks and two long weekends prompted people to fill up their gas tanks and drive. month in September as lingering summer heat spurred demand for cold drinks and two long weekends prompted people to fill up their gas tanks and drive.
■ U.K. Home Prices Decline U.K. house prices fell and mortgage approvals dropped to a 26-month low, signs the country's decade-long housing boom is coming to an end. month in September as lingering summer heat spurred demand for cold drinks and two long weekends prompted people to fill up their gas tanks and drive.
■ India Says Inflation Is 'Contained' India's central bank said three years of interest-rate increases are ``containing'' inflation, signaling that borrowing costs may be kept unchanged. end. month in September as lingering summer heat spurred demand for cold drinks and two long weekends prompted people to fill up their gas tanks and drive.
businessnow /December 5, 2007/ 9
BMW net up 78%
INTRODUCING
Costs fall at unit that makes Rolls-Royce cars By Jesus Kamblez Business Now staff writer
old prices rose to a 27-year high after the dollar hit record lows, boosting the appeal of the metal as an alternative investment. The price of gold is up 20% this year, heading for its seventh straight annual gain. The dollar fell Thursday to record lows against the euro and against a weighted basket of six major currencies, including the Japanese yen and British pound. Five of the last six bear markets for the U.S. currency sent gold higher in dollar terms. "It's hard to keep gold down when the dollar is getting crushed," said Carlos Perez-Santalla, gold trader and president of Hudson River Futures in New York. Gold futures for December delivery rose $6.40, or 0.8%, to $768.70 an ounce on the
BMW CEO Norbert Reithofer
Comex division of the New York Mercantile Exchange, marking the highest closing price for the most actively traded fu-
tures contract since Jan. 22, 1980, the day after gold reached a record $873 an ounce. The gold contract for delivery this month rose $6.60 on Thursday to $764.10. Silver also rallied. Silver futures for December delivery climbed 5.3 cents, or 0.4%, to $13.80 an ounce. The metal is up 6.7% this year. Gold's continuing surge is powering a heady bull market in some gold mining stocks. Barrick Gold Corp. jumped $1.42 to $42.13 on Thursday and is up 37% this year, com-
■ Luxottica Reports 30% Profit Jump The Italian eyeglass maker Luxottica said third-quarter profit rose after acquisitions of optical stores fueled sales. end. month in September as lingering summer heat spurred demand for cold drinks and two long weekends prompted people to fill up their gas tanks and drive. end. month in September as lingering summer heat spurred demand for cold drinks and two long weekends prompted people to fill up their gas tanks and drive.
Now what you want will get him what he wants!
■ Chinese Investors Raise $10B PetroChina Co. and Alibaba.com Ltd. sold stock valued at more than $10 billion as investors increased bets on China, where shares have almost tripled this year. end. month in September as lingering summer heat spurred demand for cold drinks and two long weekends prompted people to fill up their gas tanks and drive.
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10/ December 5, 2007 / businessnow
The Markets Stocks in the news
DirectTV (DTV)
Fluor Corp. (FLR)
Onyx Pharma (ONXX)
TurboChief (OVEN)
Goldman analyst Anthony Noto raised his rating to "strong buy," saying satellite TV company's Q3 subscriber growth was surprisingly strong.
The engineering services firm jumped 5% after announcing a 3-year partnership with China's biggest construction company.
Biopharmaceutical company's shares jumped by a third after the FDA approved the cancer drug Nexavar in the treatment of melanoma.
A deal with chicken maker Popeye's buoyed investors' hopes that this oven-seller will lessen its reliance on the Subway sandwich chain.
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Fannie Mae (FNM)
General Motors (GM)
Imergent (IIG)
Veraz (VRAZ)
Friedman Billings Ramsey removed the mortgage company from its Top Picks list amid further signs of trouble in U.S. home-buying
Shares fell 10% after the car company said it planned to re-institute zero-percent financing to pare down bulging inventories.
Investors sold shares after the E-commerce firm surprised them with an $800k Q3 loss. Imergent had earned $2M in Q3 of 2006.
Shares lost half their value after maker of communications equipment fell 3 cents short of Wall Street's 4-cent-per-share estimate for Q3 earnings.
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businessnow / December 5, 2007 /11
What they’re saying
Financial stocks take a beating By John Carrel Business Now staff writer
a was Thursday around 4:30, and I couldn’t take it anymore. Skip to next paragraph Reed Saxon/Associated Press Roger Ailes, the head of the Fox Financial Network. All week long, I’d been sporadically watching Rupert Murdoch’s new Fox Business Network, which made its debut on Monday. I was trying to figure out what, exactly, it was trying to do — and who its audience was supposed to be. It
R
■ The Street.com's Jim Cramer said Honeywell has become a "screaming buy" in an environment where investors' attention has gravitated away from big industrial companies. Honeywell's shares, which have languished this year, jumped 2.5%. ■ The Wall Street Journal's Heard on the Street column quoted private equity investors saying that the shares of drug distributor McKesson Corp. are cheap and that future buybacks should make their value clearer. McKesson's shares rose 3%. ■ A story in the Financial Times said two European social-networking firms might be looking to go public in the wake of Microsoft's $240 million investment in FaceBook. Neither of the companies, Cometogether.com or Headshift, is believed to have reached the $10 million revenue mark yet. ■ The chairman of Time Warner, Richard Parsons, said on Bloomberg Television that "almost all" of the AOL division's revenue was now coming from ads and that he expected AOL's ad revenue to jump at least 25% in 2008. ■ Shares of VMWare rose sharply for a second day after Barron’s said the company had a two-year edge over its compatitors.
wasn’t an easy task. One minute Fox was doing a segment that included a $1 million diamond; the next it was giving tips on how to avoid foreclosure. It would home in on the stock market and then report on the death of a teenager in Virginia from a staph infection, reports that included several truly silly efforts to frame the tragedy as a business story. On Tuesday afternoon, while CNBC was dissecting Intel’s earnings, Fox was running its “Happy Hour” show, which is set in a bar. A co-host named Cody, a dude so hip he doesn’t tuck his shirt in, was interviewing a random customer about his plans for
Anxious investors sold shares in Goldman Sachs and Morgan Stanley, whose CEOs, Lloyd Blankfein and John Mack, are shown here.
Christmas spending. “Expensive chocolates,” was the man’s reply. The only commonality was tone. In a week when Countrywide’s chief executive was discovered to be under S.E.C. investigation, when the market lost about 4 percent of its val-
ue, when evidence emerged that the housing slump was deepening, the tone at Fox Business was upbeat. Relentlessly, incorrigibly, unapologetically upbeat. On Thursday afternoon, Fox put on what it trumpeted as a “rare live interview” with
Warren Buffett. The interviewer was Liz Claman, an on-air hire from CNBC — indeed, Thursday was her first day on the job. In a preview a few hours earlier, Ms. Claman had promised a rock ’em, sock ’em interview, in which she vowed to ask “the greatest investor of all time,” as the Fox hosts kept calling him, all sorts of tough questions. But when the cameras rolled to begin the interview, she turned positively giddy. “I’m so happy to be part of Fox Business,” she began breathlessly. Not surprisingly, her hardball questions for Mr. Buffett soon turned to mush.
Dollar falls to year low By John Carrel Business Now Staff writer
I was Thursday around 4:30, and I couldn’t take it anymore. Skip to next paragraph Reed Saxon/Associated Press Roger Ailes, the head of the Fox Financial Network. All week long, I’d been sporadically watching Rupert Murdoch’s new Fox
Business Network, which made its debut on Monday. I was trying to figure out what, exactly, it was trying to do — and who its audience was supposed to be. It wasn’t an easy task. One minute Fox was doing a segment that included a $1 million diamond; the next it was giving tips on how to avoid foreclosure. It
Treasuries dip on dollar t was Thursday around 4:30, and I couldn’t take it anymore. Skip to next paragraph Reed Saxon/Associated Press Roger Ailes, the head of the Fox Financial Network. All week long, I’d been sporadically watching Rupert Murdoch’s new Fox Business Network, which made its debut on Monday. I was trying to figure out what, exactly, it was trying to do — and who its audience was supposed to be. It wasn’t an easy task. One minute Fox was doing a segment that included a $1 million diamond; the next it was giving tips on how to avoid foreclosure. It would home in on the stock market and then report on the death of
a teenager in Virginia from a staph infection, reports that included several truly silly efforts to frame the tragedy as a business story. On Tuesday afternoon, while CNBC was dissecting Intel’s earnings, Fox was running its “Happy Hour” show, which is set in a bar. A co-host named Cody, a dude so hip he doesn’t tuck his shirt in, was interviewing a random customer about his plans for Christmas spending. “Expensive chocolates,” was the man’s reply. The only commonality was tone. In a week when Countrywide’s chief executive was discovered to be under S.E.C. investigation, when the market lost about 4 percent of its val-
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businessnow / December 5, 2007/13
A Closer Look
Is Cayne next? His hold on Bear is tenuous after O'Neal, Prince ousters By John Carrel Business Now, staff writer
t was Thursday around 4:30, and I couldn’t take it anymore. Skip to next paragraph Reed Saxon/Associated Press Roger Ailes, the head of the Fox Financial Network. All week long, I’d been sporadically watching Rupert Murdoch’s new Fox Business Network, which made its debut on Monday. I was trying to figure out what, exactly, it was trying to do — and who its audience was supposed to be. It wasn’t an easy task. One minute Fox was doing a segment that included a $1 million diamond; the next it was giving tips on how to avoid foreclosure. It would home in on the stock market and then report on the death of
E
a teenager in Virginia from a staph infection, reports that included several truly silly efforts to frame the tragedy as a business story. On Tuesday afternoon, while CNBC was dissecting Intel’s earnings, Fox was running its “Happy Hour” show, which is set in a bar. A co-host named Cody, a dude so hip he doesn’t tuck his shirt in, was interviewing a random customer about his plans for Christmas spending. “Expensive chocolates,” was the man’s reply.
Mortgage woes The only commonality was tone. In a week when Countrywide’s chief executive was discovered to be under S.E.C. investigation, when the market lost about 4 percent of its value, when evidence emerged that the housing slump was deepening, the tone at Fox Business was up-
Lagging 30%
Goldman Sachs
20% Morgan Stanley
10%
Merrill
0% 10%
Daily closing prices of investment banks
Nov 05’
Bear
Nov 06’
Nov 07’ Source: Yahoo Finance
Why he’d stay—or go ■ Despite Bear's expected earnings problems, Cayne's conservative financial management has left Bear with ample liquidity and plenty of capital
■ Bear has warned of a possible $1 billion writeoff in the third quarter— the same species of problem that led to Stan O'Neal's fall at Merrill and Chuck Prince's at Citigroup.
ed in, he barely had to explain his rationale for not answering. She did it for him! She was so ingratiating, it was painful to watch.
Slowing down?
Finally, I muted the television. But I would occasionally glance up at the TV and read the little headlines that ■ Cayne is a savvy ■ Collapse of two inter- were running under the interview. “Thinks Copolitical infighter and has nally-created hedge ca-Cola is a great busiexcellent relationships funds broke Bear's string ness,” read one. with such key Bear direc- of profitable quarters and “Newspaper industry tors as Alan Goldstein provided a rare (unpleas- has changed in the last ant) surprise to investors. 30 yrs,” read another. and Fred Salerno. “Buying on margin is crazy.” To which the only appropriate rebeat. Relentlessly, incorrigi- viewer was Liz Claman, an sponse is: “Duh!” bly, unapologetically upbeat. on-air hire from CNBC — inI know, I know: it is unfair On Thursday afternoon, deed, Thursday was her first to judge a new cable channel Fox put on what it trumpeted day on the job. In a preview a by its first week. What as a “rare live interview” with few hours earlier, Ms. Claman was ESPN like its Warren Buffett. had promised a rock ’em, first week? Or The inter- sock ’em interview, in which CNN? Or, for she vowed to ask “the greatest that matter, investor of all time,” as the CNBC? StartFox hosts kept calling him, all ups are never sorts of tough questions. pretty. In its early Long tenure years, let’s reBut when the cameras member, CNrolled to begin the inter- BC was a view, she turned positively business giddy. “I’m so happy to be channel that part of Fox Business,” she be- lacked focus and gan breathlessly. Not surpris- identity. It had only ingly, her hardball questions one program, which for Mr. Buffett soon turned to ran all day, handed mush. When he declined to off from host to host. answer a question about “It was called ‘Money which currency he was inter- Wheel,’” recalled the star estreporter, David
Faber. It wasn’t until the mid1990s that CNBC began introducing programs with distinct identities, and began focusing maniacally on the stock market. That’s when it became a success. The irony, of course, is that the man in charge of CNBC when all that happened was Roger Ailes, who’s now running Fox Business. “My core talent is that I’m a pretty good TV producer,” Mr. Ailes said the other day. He had made his name as a take-no-prisoners adman for a series of Republican presidents, including Richard Nixon, Ronald Reagan and the first George Bush. “Bob Wright called me because they were failing,” he continued, referring to the former NBC chief
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Unofficial Business ■ THE SMART TECHNOLOGIST
if u txt, make sure 2 do it rite By John Carrel Business Now staff writer
Do text...
was Thursday around ...With friends 4:30, and I ...With under-50 family couldn’t take members it anymore. ...To communicate Skip to next paragraph essential information, Reed Saxon/Associated like your lateness for an Press appointment Roger Ailes, the head of the Fox Financial Network. Fox was running its “Happy All week long, I’d been Hour” show, which is set in a sporadically watching Rupert bar. A co-host named Cody, a Murdoch’s new Fox Business dude so hip he doesn’t tuck Network, which made its de- his shirt in, was interviewing but on Monday. I was trying a random customer about his to figure out what, exactly, it plans for Christmas spending. was trying to do — and who “Expensive chocolates,” was its audience was supposed to the man’s reply. be. It wasn’t an easy task. The only commonality was One minute Fox was doing tone. In a week when Couna segment that included a $1 trywide’s chief executive was million diamond; the next it discovered to be under S.E.C. was giving tips on how to investigation, when the maravoid foreclosure. It would ket lost about 4 percent of its home in on the stock market value, when evidence and then report on the death of emerged that the housing a teenager in Virginia from a slump was deepening, the staph infection, reports that tone at Fox Business was upincluded several truly silly ef- beat. Relentlessly, incorrigiforts to frame the tragedy as bly, unapologetically upbeat. a business story. On Tuesday On Thursday afternoon, afternoon, while CNBC was Fox put on what it trumpeted dissecting Intel’s earnings, as a “rare live interview” with
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Fox Business,” she began breathlessly. Not surprisingly, her hardball questions for Mr. Buffett soon turned to mush. When he ...With business assocideclined to answer a quesates you don’t know well tion about which currency (call instead) he was interested in, he ...To express anger or barely had to explain his communiciate a rationale for not answercomplicated emotion ing. She did it for him! ...To close a business deal She was so ingratiating, it was painful to watch. Finally, I muted the telWarren Buffett. The inter- evision. But I would occaviewer was Liz Claman, an sionally glance up at the TV on-air hire from CNBC — in- and read the little headlines deed, Thursday was her first that were running under the day on the job. In a preview a interview. “Thinks Coca-Cofew hours earlier, Ms. Claman la is a great business,” read had promised a rock ’em, one. “Newspaper industry has sock ’em interview, in which changed in the last 30 yrs,” she vowed to ask “the greatest read another. “Buying on investor of all time,” as the margin is crazy.” To which the Fox hosts kept calling him, all only appropriate response is: sorts of tough questions. “Duh!” But when the cameras I know, I know: it is unfair rolled to beto judge a new cagin the inble channel by terview, its first week. she turned What was positively ESPN like its giddy. first week? “I’m so Or CNN? Or, happy to for that matbe part ter, CNBC? of Start-ups are never pretty.
Don’t text...
businessnow / December 5, 2007 /15
■ CONDO MATH
A new answer on rent vs. buy By John Carrel Business Now staff writer
was Thursday around 4:30, and I couldn’t take it anymore. Skip to next paragraph Reed Saxon/Associated Press Roger Ailes, the head of the Fox Financial Network. All week long, I’d been sporadically watching Rupert Murdoch’s new Fox Business Network, which made its debut on Monday. I was trying to figure out what, exactly, it was trying to do — and who
The more rapid increase in sales prices vs. rental prices... 20% 15%
Sales prices
10% 5%
Rental prices 2003 2004 2005 2006 2007
...has pushed the breakeven point for buyers farther out
Exception to the rule
Kevin Johnson, president, Platforms and Services Division, Microsoft
Texting isn’t usually a good way to iron out a deal. But it was one of the tools used by Microsoft executive Kevin Johnson to convince Facebook to go with Microsoft as a partner, instead of Google.
its audience was supposed to be. It wasn’t an easy task. One minute Fox was doing a segment that included a $1 million diamond; the next it was giving tips on how to avoid foreclosure. It would home in on the stock market and then report on the death of a teenager in Virginia from a staph infection, reports that included several truly silly efforts to frame the tragedy as a business story. On Tues-
6
3
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Years
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As of: 2003 2004 2005 2006 2007
Facebook founder Mark Zuckerberg
Photo ilustration by Jesus Fernandez-Davila
Business Now asked Max Heine of NYU’s Stern School to analyze the cost of buying versus renting a two bedroom apartment in Park Slope. Above, what he came up with.
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DOWN TIME Travel
Food
A castle you can drive to
Beefeater's heaven in midtown
■ 19
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Street Style The smartest buys in the city this week
The treacherous nature of big-mountain climbing can be alleviated, if you’re willing to shell out the necessary cash.
ADVENTURE
CLIMBING
THE KILLA
Outsmarting one of the world’s toughest mountains ther people spend their honeymoon sitting on a beach in Tahiti. My wife, Susan, and I spent ours struggling up the side of Mt. Kilimanjaro, Africa's tallest mountain. Here's how it went -- day by challenging day. DAY 1. We arrive at the Kibo Hotel in Tanzania. At first glance, this doesn't seem much of a hotel; our "cottage," has a bed, working shower, and electric light. I don't yet know how luxurious this is going to seem a few days from now. DAY 2. At 4 am, we're up, drinking coffee with the rest of our group. We admire the mountain by moonlight and meet our guides -- Tim and Jonas. At 5,
O
we set off, the sun lighting up the landscape. This is the rainforest belt, and we hike, stopping only for quick slugs from our canteens; we expect to make Mandara Hut -- about 9,000 feet up -- our overnight stop, around 2:30. Day 3. Once again, we're up at dawn. Jonas warns us that today is going to be rougher than yesterday. We're up around 1300 feet, so we need to pay attention to altitude sickness. We leave at 7:30, and do OK till about noon, when disaster strikes: Susan twists her ankle badly. We straggle into Horombo Hut, our overnight place, two hours behind everybody else. One look at Susan, and Jonas says she’ll have to turn back. Day 4. One of the porters is detailed to bring Susan down the mountain, but she insists that I go on
ahead. Our group climbs for six hours straight; it feels more like 12. By the time we get to Kibo Hut, I'm deadly beat. We're up to 16,000 feet now, and it's getting hard to breathe. Day 5 We head out a little after midnight, practically crawling our way over loose rocks. Then, we hit the ice. We stop, and hook ourselves together into two groups, each led by a guide. This is the final ascent, and it's cold up here. At 6:45 we get there-- the top of Africa: 20,400 feet. We take the obligatory pictures – then start a six-hour climb back down. Day 6 We sleep in a little, then continue down the trail. My back hurts so much I can barely stand straight. We've got a solid three hours' hike ahead of us. At about 11:30, we catch a glimpse of Kibo Hotel
WHAT IT COSTS TO CLIMB:
■ $1,625 per person, for airfare and hotels ■ $43 per day for insurance ■ $225 per group of four for guides ■ 8 pounds lost during four days on the mountain ■ More info: Google “Tour guide Everest”
■ 22
businessnow / December 5, 2007 /19
Away for the weekend
NONSTOP. The courtyard at Ferncliff. Request a room in the annex -- they're bigger.
A castle on the Hudson Is a fine place for a relaxing weekend By Korin Mill Business Now staff writer
t was Thursday around 4:30, and I couldn’t take it anymore. Skip to next paragraph Reed Saxon/Associated Press Roger Ailes, the head of the Fox Financial Network. All week long, I’d been sporadically watching Rupert Murdoch’s new Fox Business Network, which made its debut on Monday. I was trying to fig-
S
ure out what, exactly, it was trying to do — and who its audience was supposed to be. It wasn’t an easy task. One minute Fox was doing a segment that included a $1 million diamond; the next it was giving tips on how to avoid foreclosure. It would home in on the stock market and then report on the death of a teenager in Virginia from a staph infection, reports that included several truly silly efforts to frame the tragedy as a business story. On Tuesday afternoon, while CNBC was dissecting Intel’s earnings, Fox was running its “Happy Hour” show, which is set in a bar. A co-host named Cody, a dude so hip he doesn’t tuck his shirt in, was interviewing a random customer about his plans for Christmas spending. “Expensive chocolates,” was the man’s reply. The only commonality was tone. In a week when Countrywide’s chief executive was discovered to be under S.E.C. investigation, when the mar-
Necessary numbers ■ WHERE IT IS: Route 9A, in Hudson ■ WHAT IT COSTS: $325--$850 per night ■ HOW TO REACH THEM: 914-666-0000; email at:www.ferncliff.com ■ HOW FAR A DRIVE: 118 miles from midtown; about two hours ■ IN THE NEIGHBORHOOD: Fabulous antiquing/shopping at the 136 stores and galleries along Main and School streets; Olana, which showcases paintings by the Hudson River artists, is open for private tours ($100 for two; email:www.olana.com). Jimmy’s, on Elm Street, serves terrific home-made soups at lunchtime ($22 for two; 121 Elm, corner of Main)
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20/ December 5, 2007 businessnow
Food & Drink
Big beef We'll get an argument, but we say the steaks at Wolfgang's are the best in town. By Natasha Krylova Business Now staff writer
Thursday around 4:30, and I couldn’t take it anymore. Skip to next paragraph Reed Saxon/Associated Press Roger Ailes, the head of the Fox Financial Network. All week long, I’d been sporadically watching Rupert Murdoch’s new Fox Business Network, which made its debut on Monday. I was trying to figure out what, exactly, it was trying to do — and who its audience was supposed to be. It wasn’t an easy task. One minute Fox was doing a segment that included a $1 million diamond; the next it was giving tips on how to
I
avoid foreclosure. It would home in on the stock market and then report on the death of a teenager in Virginia from a staph infection, reports that included several truly silly efforts to frame the tragedy as a business story. On Tuesday afternoon, while CNBC was dissecting Intel’s earnings, Fox was running its “Happy Hour” show, which is set in a bar. A co-host named Cody, a dude so hip he doesn’t tuck his shirt in, was interviewing a random customer about his plans for Christmas spending. “Expensive chocolates,” was the man’s reply. The only commonality was tone. In a week when Countrywide’s chief executive was “Expensive chocolates,” was the man’s reply.
The bar at Wolfgang’s has been a gathering place for high rollers for 100 years.
ket lost about 4 percent of its value, when evidence emerged that the housing slump was deepening, the tone at Fox Business was upbeat. Relentlessly, incorrigibly, unapologetically upbeat. On Thursday afternoon, Fox put on what it trumpeted as a “rare live interview” with Warren Buffett. The interviewer was Liz Claman, an on-air hire from CNBC — indeed, Thursday was her first day on
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the job. In a preview a few hours earlier, Ms. Claman had promised a rock ’em, sock ’em interview, in which she vowed to ask “the greatest investor of all time,” as the Fox hosts kept calling him, all sorts of tough questions. But when the cameras rolled to begin the interview, she turned positively giddy. “I’m so happy to be part of Fox Business,” she began breathlessly. Not surprisingly,
The dining room at Wolfgang’s , in Midtown, has a clubby feel -- and superb, if huge, steaks and chops.
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Heineken® DraughtKeg’s unique carbonation system delivers perfect draught beer with an authentic tapping experience. Chill time: 10 hours | Fresh time: 30 days Visit www.HeinekenDraughtKeg.com www.EnjoyHeinekenResponsibly.com ©2007 HEINEKEN Lager Beer. Heineken USA Inc., White Plains, NY. ®
Food & Drink
Opening This Week SOLEX Veloce speaks French, as Frederick Twomey, owner of the popular Italian wine bar branches out with a Gallicinspired wine bar on the East Side. Expect first-class charcuterie to make the vin go down, and a mind-boggling selection of cheeses. And what about those beef Wellington éclairs? (703 First Avenue; 212-7776677; small plates, $7-18)
DESSERT STUDIO In among all those baubles at ABC Carpet, there is now a chocolate bar. The swanky seven-stool spot will be open Thursday to Sunday till midnight. So, how about those warm chocolate bubbles with espresso jell-o? (888 Broadway; 212-4777335; desserts, $12-$16)
5 GUYS The guys behind Frankie’s (of Brooklyn fame) are moving across the river, and they’re bringing their sandwiches, soups, and pastas with them to Midtown. Given their track record, this looks like a great place for a quick bite for lunch or post- or pre-theater. (43 West 55th Street; 212-459-9600; pastas, $9-$16)
BLUE RIBBON SUSHI BAR & GRILL. The Bromberg brothers are adding to the mix of their mini-chainlet, Blue Ribbon and Blue Ribbon Bakery. Even if you’re not crazy about sushi, there’s plenty here to eat: the menu includes classic dishes from the downtown brasserie, including the marrow bones,
matzoh-ball soup, and cheese fondue. The new place is uptown, though, in the Columbus Circle Hotel. (6 Columbus Circle; 212397-0404; entrees: $16-$24) brasserie, including the marrow bones, matzoh-ball soup, and cheese fondue. The new place is uptown, though, in the Columbus Circle Hotel. (6 Columbus Circle; 212-397-0404; entrees: $16-$24)
businessnow / December 5, 2007 /21
This week’s top 5 bars Where to get great apple Martinis BLUE BAR AT BAYARDS You don't get more posh than this: plenty of mahogany, lots of polished brass, and that endearing clipper ship. Just don't go on Wednesdays or Thursdays, when it seems like everybody you ever heard of turns up for the torch singer (and the less said about that, the better). (1 Hanover Sq.)
TRIBECA GRAND The bar is a great soaring space, and you don't have to deal with all the happy harrys you run into at Rise. Nice for a low-key drink after work. Let somebody else order the mango daiqiri while you play it classic with the vodka martini - shaken, not stirred, natch.(261 Church)
CARNEGIE CLUB You want to be a little retro
and a lot cool, head to midtown for this classy space that comes courtesy of the folks behind the Campbell Apartment. Chill with the house's Silver Martini; best of all, you can smoke. Cigars, that is. (156 W. 56th St.)
CIBAR Very elegant, and the patrons (male and female) aren't bad, either. Tucked away under a chic little hotel on Irving Place, this is one of those places where you take a suburban client and look like a genius. Oh, and yes, you can smoke in the heated garden out back. (16 Irving Place)
CHILL LOUNGE That's what you do -- chill, right up next to the fireplace, in an atmosphere that feels more
Loire Valley than Midtown Manhattan. Seriously good martinis, and they don't come in those kiddie flavors. (329 Lexington)
Shopping
22/ December 5, 2007 businessnow
Street
Style What to buy, wear, or see this week They say the only difference between kids and grownups is the price of their toys. This week, we've got toys for everyone—whether you want to zip around town faster than a speeding bullet or contemplate who's the fairest of them all. And, no, those boots are not made for walkin.'
HOT WHEELS There was a time when scooters were strictly for wimps, but no more. This snazzy little red Vespa zips you all around town, and you’ll never have to hail a cab again. (Midtown Scooters, 89 11th Avenue)HOT WHEELS. There was a time when scooters were strictly for wimps, but no more. This snazzy little red Vespa zips you all around town, and you’ll never have to hail a cab again. (Midtown Scooters, 89 11th Avenue)
FOR HER The sleekest boot on the street is this black and gold number from Versace. Velvety suede somes trimmed with gold embroidery. Dress them down (well, a little) with black pants. Dress them up with the proverbial little black dress. ($860; To order from Versace)
FOUR FOR FORE We like the cheeriness of these colorful golf balls; we also like the fact that you can find them when (duh) they roll off into the rough. We also like them because they make nice little presents – and they’re cheap. ($6 for the set of eight; Paragon Sporting Goods; Union Square
SMART MONEY Where to invest this year’s bonus? Forget real estate—overpriced, and crashing even as we speak. Instead, think art. According to London’s Fine Arts Association, which tracks these things, the art market is set to soar this year. What’s hottest in New York? Folk art. Sotheby’s shows off this gem of a horse, hand-carved and painted in 1768. It’s last going price: $12,762 – in 1986. Now it’s back on the market, and they’re looking at an opening bid of a cool half a mil. Oh, and while your profit’s piling up, you’ve got something great to look at. Try that with stocks.
HERE’S LOOKING AT YOU 18th century Empire looking glass comes with a pedigree that stretches through Josephine’s digs at Fontainebleu; there’s no reason it shouldn’t grace your house. ($15,255 Morton’s Fine Antiques, 750 Madison Avenue)
FOR SCOTCH GREAT SCOT Upside: For the first time ever, Laphroig is exporting its 100-year-old single malt, unavailable till now anywhere but the UK. Downside: They’re exporting very little of it, since most of it is already spoken for by London’s Clubland. If you move fast, though, you can still squeeze in an order at – where else – Sherry Lehmann. ($679 per bottle; 505 Park Avenue, 212-838-7500) For Golfballs
MR. BIG ■ DEAR MR. BIG: So, ‘Young Frankenstein’ is the new ‘Producers?’ Everybody says there are not tickets to be had for the opening—I should have ordered them in July. What can I do?— Desperate on Wall Street ■ AR DESPERATE: Calm down. There are real things to get desperate about. Like, maybe, short-term credit. Only theater parties order ahead. For you, ‘Frank’ tickets are easy. The concierge at the Mercer Hotel is sitting on a whole block of ‘em, and they are (legally) allowed to sell ‘em to the highest bidder. So, call up and put in a bid, then a second. Or a third, if that’s what it takes. Hey, it’s only money.
Sandals Grande Ocho Rios Beach & Villa Resort Sandals Negril Beach Resort & Spa Sandals Whitehouse European Village & Spa
$639 $759 $759
Sandals Grande St. Lucian Spa & Beach Resort $999 Sandals Royal Bahamian Resort & Offshore Island $1,115 Sandals Grande Antigua Resort & Spa $1,159
For reservations or assistance in planning your vacation, call American Express Travel at:
888-AXP-0006
or visit www.americanexpress.com/vacations American Express Vacations tours operated by Travel Impressions, a subsidiary of American Express. Published airfares can fluctuate daily & rates reflect the lowest airfare available at time of printing. Airfares are subject to restrictions, surcharges & blackouts and must be ticketed within 24 hrs to protect fare. Pkgs include roundtrip coach airfare from JFK/LGA on American Airlines, roundtrip airport/hotel transfers, Hotel accommodations & hotel tax. Rates are per person, double occupancy, during midweek travel. Blackout dates, weekend, holiday & peak season surcharges may apply. Gov’t imposed taxes of up to $101 (including Sep. 11th Security Fee of up to $10 and PFC’s of up to $18) are additional per person. Foreign gov’t departure taxes of up to $45 per person may be additional and are payable upon entry/exit of country. Not responsible for errors or omissions in the printing of this ad. Rates & promotions are accurate at time of printing & are subject to availability, blackouts, changes, exceptions, cancellations & restrictions. Rates valid for travel 9/25/07-12/31/07. American Express Travel Related Services Company, Inc. acts solely as sales agent for travel suppliers and is not liable for their actions or inactions. CST#10223818-10, TA# 002 - Registered Iowa Travel Agency, NV#2001-0126, Washington UBI# 600-469-694, ML#1192. 10.4.07 PK
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