Idiot Inc. » Brainy Ideas

New York Times whores out its front page for the first time ever

Jacopo Kane — Mon, 05 Jan 2009 16:08:32 +0000

The high-falutin’ NY Times has sold its first-ever front page advertisement. In today’s paper, a full-color ad for CBS appears on the bottom of the paper. It isn’t much to look at, just a few stock photos and the ever-creepy CBS eye.

This move was a long time coming for the old gray lady, which has had to cut stock dividends, freeze wages, and mortgage its headquarters in order to deal with plummeting revenues.

Take a look at the remedy to their problems:

[Gawker] Times Finally Runs Display Advertising on Front Page

At last: IndyMac may be sold

Jacopo Kane — Tue, 30 Dec 2008 16:18:45 +0000

It looks as though failed bank IndyMac, which was seized by the feds last July, may be sold off as early as tomorrow. A holding company has applied to the Office of Thrift Supervision to buy the assets of the bank for $14 billion. IndyMac is the only failed bank that the government has not been able to find a buyer for.

The company that has applied to purchase the bank is HoldCo LLC, which was formed by hedge-fund superstar John Paulson, “buyout investor” Christopher Flowers, and Dune Capital chairman Steve Mnuchin. This group might have had some credibility in 2006, but will they be able to hack it now?

[Biz Journal] Report: $14B IndyMac sale could come by Wednesday

GMAC gets $5 billion in bailout scrilla

Jacopo Kane — Tue, 30 Dec 2008 16:09:33 +0000

The federal government will be investing $5 billion into auto-lender GMAC in order to stave off a possible bankruptcy of the company. Predictably, GMAC will now transform into a “bank holding company” along with every failed lender that needs to take money from Uncle Sam.

In addition to the money GMAC is receiving directly, General Motors, part-owner of GMAC, will receive $1 billion to help the lender’s transition into a bank.

Kerkorian bails out (of) Ford

Jacopo Kane — Tue, 30 Dec 2008 05:11:28 +0000

Kirk Kerkorian, the billionaire investor who was briefly Ford’s largest shareholder, has sold his entire 6.5% stake in the company at a loss of hundreds of millions of dollars. Kerkorian’s investment firm had amassed 133.5 million shares in the automaker, but obviously put its traders on more overtime than a Ford factory worker in order to sell the huge position.

Estimates of the loss on the trade were between $475 million and $800 million. This is a terrible sign for Ford, which didn’t take any bailout money.

[Reuters] Kerkorian sells off Ford shares at deep loss

Chrysler to idle manufacturing plants for “at least one month”

Jacopo Kane — Wed, 17 Dec 2008 23:54:18 +0000

Chrysler will be shuttering its manufacturing plants for one month beginning on Friday in order to “align production and inventory with U.S. market demand.” In total, 30 plants will be closed. Affected workers won’t resume their jobs until January 19th at the earliest.

More info:
[Bloomberg] Chrysler Idles Plants for a Month; GM Halts Volt Engine Factory
[Globe & Mail] Chrysler halts all production for one month
[WSJ] Chrysler to Close Manufacturing Plants for a Month Starting Friday

Layoffs at Detroit newspapers, home delivery will be scaled back

Jacopo Kane — Wed, 17 Dec 2008 20:56:14 +0000

The Detroit Media Partnership — which owns the Detroit News and The Detroit Free Press — has announced that they will only be offering home delivery three days per week, and will be laying off 9% of their total workforce. The papers currently employ 2,151 workers.

David Hunke, publisher of the Free Press showed off his remarkable ability to state the obvious:

“Our decision to limit home delivery to three days a week reflects the reality that major newspaper markets are facing daunting economic challenges. Advertising in this economy is down and costs are up. We can’t live in the past.”

It’s that kind of prescience that has put these newspapers on the cutting edge of media…

[Chicago Sun Times] Detroit newspapers cut back home delivery, announce layoffs

Best Buy 3Q profit falls hard; company will pay employees to leave

Jacopo Kane — Tue, 16 Dec 2008 17:50:33 +0000

Electronics retailer Best Buy announced that its third quarter profits sank 77% compared to the year before as the company faced “the most challenging consumer environment” in company history.

The company aims to cut capital spending by 50% in 2009. To pursue this, the company will offer “massive buyout packages to about 4,000 employees at its headquarters.”

CEO Brad Anderson had this to say:

“We need to prepare our organization to operate in a wide range of potential macroeconomic scenarios in the coming year. We believe our broad, voluntary program helps prepare us for the unpredictable year ahead while reflecting our company values and respect for our people.”

Bravo, Brad. I doubt you’ll be taking home $49.3 million this year, though.

[Yahoo Finance] Best Buy 3Q profit sinks, offers staff buyouts

The Arena Football League has cancelled its 2009 season

Jacopo Kane — Mon, 15 Dec 2008 21:01:05 +0000

The Arena Football League has announced that its board of directors has voted to cancel the 2009 season because of the “unprecedented economic climate.” The 22-year-old league and its 16 teams will spend next year “developing a long-term plan to improve its economic model.”

[Boston Herald] Arena Football League cancels 2009 season
[Sports Couch Potato] Arena league shuts down for ‘09

Honda cutting rice-rocket production by nearly 10%

Jacopo Kane — Fri, 12 Dec 2008 23:45:52 +0000

Because of freefalling automobile sales, Honda has announced that it will be cutting its North American vehicle production by 119,000 cars. Production will be scaled back at facilities in Ohio and Alabama, but the company claims that no layoffs are planned.

The cuts represent almost 10% of the company’s yearly automobile output, and is the second time the company has slowed production this year.

[Yahoo Finance] Honda cuts North American production again

Chrysler really wants your money

Jacopo Kane — Tue, 09 Dec 2008 17:40:39 +0000

Dealbreaker points us to the Chrysler homepage which has been turned into a plea for ~~bailout money~~ a loan to help them succeed.

Also included is a video of Chrysler employees explaining why the company deserves a bailout. Are you convinced yet?

New York Times mortgages Manhattan office for cash

Jacopo Kane — Tue, 09 Dec 2008 01:08:50 +0000

The New York Times Company will borrow up to $225 million by guaranteeing its debts against its Manhattan headquarters as the company scrambles to deal with an ever-shrinking cashflow. The company owns 58% of the 52-story skyscraper, which some investors claim is too much of a weight on the Times’ balance-sheet. Now the building will be collateral for a fresh new round of loans. Let’s hope it means they won’t have to gut the newsroom.

[IHT] Times Co. to borrow against building

New York Times slashes dividend and eyes other cost-cuts

Jacopo Kane — Thu, 20 Nov 2008 22:38:17 +0000

The New York Times is taking the drastic move of cutting its dividend by nearly 3/4ths and will “reevaluate its assets” in order to cope with the industry-wide downturn. A rumor has been circulating for a few months that the Times might cut some of its newsroom staff and this announcement might be a precursor to that.

There has also been speculation that the company might sell off its interests in web property About.com, but this would most likely be a bad move since About is reportedly very profitable. I’m too lazy to check right now so take that for what it’s worth.

[Reuters] New York Times cuts dividend, ‘reevaluates’ assets

Racing for cash, Ford sells 20% of its stake in Mazda

Jacopo Kane — Tue, 18 Nov 2008 15:21:35 +0000

Ford will give up its controlling stake in Mazda by selling 20% of the Japanese automaker for $450 million. The company is in desperate need for cash after its October sales dropped by 30%. Two Ford members will get the boot from Mazda’s board of directors, but the operations of the two companies will likely continue to be cooperative in the short-term.

A cowardly anonymous analyst had this to say about the deal:

“From a strategic perspective there’s not much change, but it was a desperate move by Ford, selling at this low price, and Mazda had no choice but to buy back part of it because they couldn’t find enough buyers.”

[Reuters] Ford abandons Mazda control with 20 percent stake sale

Profitable American Express asks taxpayers for $3.5 billion

Jacopo Kane — Wed, 12 Nov 2008 18:22:08 +0000

~~Credit card company~~ Bank holding company American Express is asking Uncle Sam for a $3.5 billion dollar slice of the bailout pie. The company’s third-quarter profit fell 25% to just shy of $1 billion — must be really tough for them. There has been no word on what Amex’s chances of getting taxpayer cash are, but it would be pretty asinine to start giving companies that turn a profit bailouts. Especially companies that were a large part of the problem…

[Yahoo Finance] Ahead of the Bell: American Express seeks $3.5B

Aliph CEO spent $500,000 on furniture on eve of layoffs

Jacopo Kane — Mon, 10 Nov 2008 17:57:32 +0000

One week ago, the 75 employees of bluetooth headset maker Aliph were told to pack up their workspaces in preparation for $500,000 in expensive office furniture that the company’s CEO, Hosain Rahman, had ordered. One-third of these employees were never allowed to unpack their belongings — they had been laid off and given just two weeks severance.

In addition to the high-end office furniture, Rahman commissioned an up-and-coming artist (Tucker Nichols) to paint a mural for an undisclosed amount of cash. I wonder if Aliph will get something as poignant as this:

[PEHub] Can You Hear Me Now? Jawbone Maker Proves Tone-Deaf in Tough Times