May 9, 2008 2:14PM
By Alexis Glick
Are you as excited as I am about the upcoming release of The Chronicles of Narnia: Prince Caspian?
I know that I’ve been writing a fair amount about movies of late. The truth is my hobby (or place to shutdown my brain and enjoy a box of Milkduds or Raisinets) is going to the movies. I LOVE movies. Probably should have gone into the business. I try to see most of the well-regarded movies, which sometimes means seeing two movies a week. This week, I saw Redbelt and Speed Racer. I personally prefered Redbelt, a mixed martial arts movie. But that’s just me.
The latest installment of The Chronicles of Narnia will be released next Friday, May 16. Today I sat down with the new actor that EVERYONE is talking about, Ben Barnes. He’s exceptionally handsome and has a terrific English accent. It looks like has has a very bright future ahead. He looks like the next Orlando Bloom or Hugh Grant! Trust me :). Ben plays Prince Caspian in the new movie. He was discovered performing in a play called “The History Boys” in London and this is his first breakout role. Take a look. He’s single too!!
May 9, 2008 11:40AM
By Alexis Glick
Ok. I admit it. I’m shameless! I LOVE McDonald’s!!!! Ever since I was a kid my dad and I would pop in for our weekly or bi-weekly McDonald’s visits. The ketchup, a huge allure, is the best in the business but, let’s face it they do have the BEST french fries in the business!!
Several months ago I went the McDonald’s headquarters in Illinois and interviewed Chief Executive and Vice Chairman Jim Skinner. It was a big deal for me and a plum assignment. To learn more about the company, I talked to the CEO, a loyal McDonald’s employee for over three decades, and I ate my favorite food. NO BRAINER!!! While I was there I talked about my new favorite item: the snack wraps. That got me thinking why not make a snack wrap for breakfast with egg whites? A healthier option! They do have the breakfast burrito, but that’s not the same. So I convinced the PR team of Walt and Heidi (who I adore) and Skinner to let me come back and test the egg white wrap.
And I did! Just a couple weeks ago I spent the day with the mastermind behind what you eat at McDonald’s every day, Chef Dan Coudreaut, director of Culinary Innovation and his team (four other equally impressive and well-known chefs). Chef Dan is responsible for putting the food on your plate in over 14,000 restaurants around the globe. He is the inventor, inspector and creator of the food that more than 25 million people in the U.S. eat every day. He has been called the most influential chef in America and rightly so. He dictates what the future looks like for McDonald’s.
He also was nice enough to let me spend a day with him and learn how he selects which foods McDonald’s puts on its menus. It’s no easy science. In fact, one of the key issues he has to think about is whether there are enough crops or factories that can supply McDonald’s with the amount of the item needed. For example when he decided to create a salad with edamame and mandarin oranges, he had to be sure that he wouldn’t wipe out the supply in the US or affect the global supply chain. An amazing phenomenon!
So here you go…..Chef Dan…what he sees in the future for McDonald’s and what he thinks about the McGlick (the name I recommended for the healthier egg wrap)!!!!
By the way, the egg wrap that he made and we tested…..it was unbelievable! One of the best that I have EVER had…
May 9, 2008 11:30AM
By Alexis Glick
Get this the gaming industry last year reported $9.5 billion in software sales! HUGE…..that’s right. Last night Activision reported earnings and once again knocked the street off their feet thanks in large measure to Guitar Hero and Call of Duty. They gave strong guidance for 2008. Not bad for an industry that continues to grow and draw tremendous eyeballs.
Look at Take-Two Interactive’s release of Grand Theft Auto Four a week ago. They sold six million copies in its first week of sales grossing more than half a billion dollars breaking all records and beating the projections. A HUGE win for Take-Two!
So what will the future look like for the newly combined Activision and Vivendi soon to be known as Activision Blizzard? Will Electronic Arts succeed in their $2 billion offer to buy Take-Two Interactive and how do the blockbuster sales of Grand Theft Auto affect that deal? Michael Pachter, an analyst from Wedbush Morgan Securities and Marc Doyle, Co-Founder and Editor of Metacritic, a website that rates games based on performance and reviews, joined me this morning to talk about the future of the gaming industry. A subject that dominates in the Glick household! Take a look.
May 9, 2008 11:09AM
By Alexis Glick
Last night I had the great pleasure of attending the IMAX premiere of Speed Racer here in New York City. First of all, if you have not seen a movie on an IMAX screen or did years ago and haven’t recently, you HAVE TO GO. It is INCREDIBLE!!! The coolest movie viewing experience especially for a movie like Speed Racer, which was shot on the green screen by the Wachowski brothers (maker of the Matrix movies).
The movie which took 22 years to make has a very well-known cast including Susan Sarandon, John Goodman, Emile Hirsch, Matthew Fox and Christina Ricci. It is based on a cartoon from the 1960’s. The man behind the 22 year quest to win the rights from a Japanese company when he was a senior in college is David Lane Seltzer. He joined me on Money for Breakfast to talk about the making of the movie and why he so passionately fought to have it made. It’s a remarkable story. He also happens to be the founder of Management 360, a management company. They happen to manage some of the biggest names in Hollywood. Take a look.
May 9, 2008 6:15AM
By Alexis Glick
Yesterday I had the pleasure of guest speaking at the WCBS 880AM Women’s Luncheon with Nell Merlino. She is the force behind Take Our Daughters to Work Day and the president and CEO of Count Me In. Count Me In “champions the cause for women’s economic independence by providing access to business loans, consultation and education.” Listen to some of these statistics about women owned and operated businesses. - 48% of small businesses are run by women while 52% are run by men.
- Approximately 1,000,000 small businesses are run by men and have revenues of $1 million dollars or more.
- Approximately 250,000 small businesses are run by women and have revenues of $1 million dollars or more.
- Women-owned businesses employ approximately 30 million people.
- Women business owners contribute more than $3.6 trillion to the marketplace each year, and women account for more than 70% of consumer spending.
- 55% of women provide half or more of their household’s income, yet 48 million women or 80% of all women in the workforce earn less than $25,000 dollars a year.
Nell has made it her personal mission, and Count Me In’s mission, to increase the number of $1 million dollar revenue generating businesses for women to 1 million by 2010. She is a remarkable woman! She is one of the smartest and most dedicated women that I have ever met. She talked at length about the lending environment. She works with many financial institutions across the country and said that she is not seeing defaults or businesses fail. She actually said that institutions (banks and brokers dealers) call her to see if she is seeing some weakness in the market and said she has not seen any cracks in the small-business market.
She was also there to talk about a program that she offers in conjunction with her original financial partner, American Express, called the “Make Mine a Million Business Program” which is a part of Count Me In For Women’s Economic Independence. The program provides money, mentoring, marketing and technology to help women grow micro businesses into million dollar businesses. This program, which she calls a cross between “The Apprentice” and “American Idol,” allows women to compete face to face with judges and an audience to sell their product and prove that they are deserving of the “Make Mine a Million Award.” Yesterday, Nell brought two of the award recipients, Nandini Mukherjee, owner of the Indian Bread Co., marrying Indian flavor with the portability and convenience of the American sandwich, and Dr. Julie Goldman of The Original Runner Company, a company that sells customized non-slip aisle runners for weddings and special events.
If you want more information about either program you can go to www.count-me-in.org or www.makemineamillion.org.
You’ll be happy to know that I asked Nell, Nandini and Julie to appear on Money for Breakfast next week. I will let you know which date they are on. I also want to give a shout out to WCBS AM’s eighth-consecutive Women’s Business Luncheon and the host Pat Carroll, who hosts WCBS 880AM’s morning radio show. This is a wonderful speaking series that engages women in their financial future and helps them network with other women. Hats off to them for their tremendous work!
May 8, 2008 5:35PM
By Alexis Glick
Every Thursday on The Opening Bell, we do a special “Market Maven” segment with a true business world legend. This week, our guest was Mario Gabelli of GAMCO Investors — he’s the chairman & CEO and one of the most highly respected value investors in the business. He’s the guy who gets quoted everywhere. He loves to talk about and invest in media companies like DirecTV and Cablevision, and has made agressive purchases of companies like Diebold, a manufacturer of ATMs and voting machines.
GAMCO Investors is a diversified asset management and financial services company. The firm manages money for high net worth individuals, institutions and pension plans.
This morning, I asked Gabelli if he agreed with Treasury Secretary Paulson’s comment that the worst of the credit crisis is behind us. He disagreed! I asked him if we were in a recession. He said it started on November 1st of last year! We talked about stocks, media, inflation, M&A — you name it. It was very telling. Take a look. He sees opportunities in this market!!!!
May 8, 2008 2:58PM
By Alexis Glick
This morning our Washington, D.C., Correspondent Adam Shapiro interviewed Treasury Secretary Henry Paulson at an IRS Office in Kansas City where 400 rebate checks a minute are being printed. Aside from the fact that I think he did a phenomenal job, he also broke some news. Take a look.
May 8, 2008 7:01AM
By Alexis Glick
A couple of updates to past blogs:
1. Paul Pompa Jr. and Michael Iavarone, co-president & CEO of I.E.A.H. — the co-owners of Kentucky Derby winner Big Brown — joined me again on Money for Breakfast a couple of days ago after winning the Derby. They received many offers for the horse the following two days. Those offers range from $60 million to $80 million dollars!!!!! Is that unbelievable? Remember when I first posted the blog, Big Brown was Paul Pompa Jr.’s horse and he sold a 75% stake to I.E.A.H., a hedge fund made up of former Wall Street guys, for reportedly $3 million dollars. With his remaining 25%, the horse prior to the race was valued at $4 million. Look what a winner can do! If he wins the Triple Crown, Big Brown will be worth $125 million. Why so high? The value of the horse is determined by future breeding rights.
2. Senator Trent Lott joined me yesterday on Money for Breakfast. He called ethanol a “hoax.” He said we should drill in Anwar and agreed with Senator Kay Bailey Hutchison’s call to stop filling the Strategic Petroleum Reserve. Lott is a big supporter of McCain. When asked who he would recommend for VP if McCain asked him, he threw out the newly elected governor of Louisiana Bobby Jindal and Robert Portman, former House member from Ohio and former director of the Office of Management and Budget.
3. In response to my blog yesterday about the risks to FNM, a friend in the credit markets sent me some anecdotal evidence to the point I made about international investors buying agency debt. Here’s what he sent:
Foreign official institutions have tended to invest primarily in Treasury securities, but in recent years have increasingly purchased agency securities as well. During the period between the 2004 and 2007 surveys, foreign official holdings of U.S. agency debt securities grew from 34 percent to 58 percent of total foreign holdings.
4. Yesterday I interviewed the CEO and founder of the Sports Museum of America, Philip Schwalb and Mike Ryan, an investor and member of the board of directors. The museum is located next to Ground Zero. It opened yesterday. It took seven years for Philip to realize his dream. It took $100 million to fund. Sixty-two different sports are represented. It is now the official home of the Heisman Trophy and the first women’s sports hall of fame. A portion of the ticket sales go to charities like the Jackie Robinson Foundation (a frequent guest and friend of Money for Breakfast) and to Children’s Hospital Charities. If you’re in New York, stop by! One of the cool parts is that some of the memorabilia is not behind glass. Kids can take a swing with A-Rod’s bat or take a shot with Wayne Gretzky’s stick. Big time Wall Street executives like the vice chairman of Merrill Lynch, the president of Goldman Sachs, the chairman of Blackrock and many more invested in this property.
May 7, 2008 4:51PM
By Alexis Glick
Sometimes, I think I’m schizophrenic! On the one hand, I’ve been pretty bullish about this market… and on the other hand, I look at the UBS news, rumors that Bank of America is trying to back away from the $7 a share bid for Countrywide (feeling that they overpaid — you got that right — and would now like to pay $2 a share), and Fannie Mae’s (FNM) third quarterly loss… And I can’t help but wonder is there another shoe to drop.
Everyone I talk to at the big banks, many of whom sit in the executive suite, feel the credit markets have turned the corner. They’re raising money pretty easily, particularly given the climate three months ago. They’re shedding assets and the credit markets have tightened. Just look at the spreads in the credit swaps market. They’re also the first to admit that Wall Street one year from now will look a lot different than it does today, and that at least 20%, if not 30% of the jobs will get cut. How the brokers make money when they’re forced to deliver is a whole other issue all together. I could dedicate five other blogs to that story.
But the reason I’m writing this blog is to discuss the elephants in the room: Fannie Mae (FNM) and Freddie Mac (FRE). After FNM reported its third quarterly loss yesterday, the stock had a very nice rally into the bell. The company added to its string of writedowns and talked about plans to raise $6 billion dollars. Friends tell me that agency paper historically, even at times like this, has a strong underlying bid from foreign investors — particularly given the spreads on agency versus treasury debt. Plus, let’s face it: we’re cheap at the moment and everyone on the planet knows that if we let FNM fail, the entire housing market and financial system collapses. Supporters of FNM say yesterday’s number wasn’t that bad, noting that the company lost $2.3 billion on mortgage defaults compared to $2.2 billion last quarter and that . Call me crazy, but that doesn’t sound very compelling! The company cut its dividend by 29% to 25 cents per share, which Wall Street tends to like — a sign it’s doing what it takes to shore up the balance sheet. That will free up $390 million dollars of capital. Fannie did improve market share, book of business and revenue from their guarantee and investment activities.
So is FNM in trouble? Was raising the cap the right decision or a reckless decision? What do you think about OFHEO’s decision to cut Fannie Mae’s capital surplus to 5%? The decision made by OFHEO, the Office of Federal Housing Enterprise Oversight, to lower its capital requirements and increase the size of the loans it is willing to lend was made in the hopes that FNM and FRE could fund a combined $200 billion in mortgage purchases. The problem, one which Barney Frank is addressing today on Capitol Hill and will address directly with FNM and FRE on May 21st, is why jumbo mortgages are still next to impossible to get and why rates have not improved given the increase in loan limits at FNM and FRE. Wasn’t that initiative supposed to help revitalize the mortgage and home buying market?
To date roughly $330 billion in mortgage securities have been written off and roughly $200 billion has been raised to shore up balance sheets, but predictions for mortgage related debt/risk are as high as $1 trillion. Is the worst behind us in the housing market? Not according to the most recent statement by FNM, who predicted yesterday that home prices in the U.S. could decline another 7 to 9%. Foreclosure filings as we’ve discussed in the past are up 23% in the first quarter and were more than double a year ago and — let’s face facts — we haven’t even hit the peak period of April and May where record amounts of adjustable rate mortgage mortgages are due to reset.
My friend Richard Suttmeier, Chief Market Strategist of Rightside.com makes some very valid and aggressive points on this issue. He notes several key issues:
1. Builders and developers are having problems re-paying $629 billion in construction and development loans to the community and regional banks. Four hundred and sixty-seven publicly traded banks have risk exposure to C & D loans that exceed regulatory guidelines.
2. The Federal Reserve should be the regulator of the primary dealers.
3. The FDIC (Federal Deposit Corporation) should be the regulator for all banks.
He also notes when discussing the TSLF (Term Securities Lending Facility) and PDCF (Primary Dealer Credit Facility):
“I think that the US Treasury and Federal Reserve have gone beyond the letter of the law with these lending facilities, and they put all Americans at risk by taking on securities that no one in the world wants to own. Since announcing these programs yields on US Treasuries have risen dramatically and the sizes of the two-year and five-year auctions have reached record amounts.
As the Federal Reserve takes on more toxic securities the primary dealers are able to buy more from clients around the world. How long will this process take given $165 trillion in notional amount of derivative contracts negotiated mainly by JP Morgan, Bank of America, Citigroup and Wachovia, etc. Don’t forget it’s a global issue with an estimated $500 trillion spread around the globe.
The FDIC Quarterly Banking Profile for Q1 2008 won’t be released until May 29, after Memorial Day. The data filed to the FDIC for this most important economic data includes details not required in reporting banks quarterly earnings report. I comb the data to find where the additional bad loans will come from. Sources tell be that some banks have not yet filed their data for Q1, and Bank of America is on the list of “Not Yet Filed” - HMMM!”
This morning, I invited Richard to state his case for the nationalization of FNM once again. A gutsy call! He thinks all GSEs should be nationalized and regulated by the U.S. Treasury. He doesn’t believe that if losses get worse, the loans will default. At the end of the day, he says they’ll get bailed out regardless of their status as a public company. After all they do have a not so quietly hidden line of credit with the U.S. government.
Get to the point Glick! Take a look at Richard go toe-to-toe with Chuck Lieberman, the Chief Investment Officer of Advisors Capital Management, who thinks Richard is taking it too far.
Believe me, the halls of Congress are panicking about reforming the GSEs and if you don’t think the increased risk on their books to help revitalize this economy isn’t dangerous, you’re kidding yourself. Stay tuned. This is a story that isn’t going away!
Watch the video:
May 7, 2008 4:30PM
By Alexis Glick
Indiana and North Carolina are now behind us — and, while Senator Clinton won by a small margin in Indiana, she did lose North Carolina by a larger margin than anticipated. This has to be bad news for a campaign that needs money to keep the message alive through the next three primaries: West Virginia (5/13), Kentucky (5/20) and Oregon (5/20).
According to political pundits, Senator Clinton would now need two-thirds of the Super Delegates to win the nomination. The sounds of victory could be heard far and wide in the Obama camp and the calls for a Clinton withdrawal will get louder and more aggressive.
So we decided on Money for Breakfast to talk to the financial brains behind each campaign. How would last night’s results change their game plan going forward? What has worked? What hasn’t worked? Keys to their success? How will they plan to adapt?
Shortly after the interview with Hassan Nemazee, Chairman and CEO of Nemazee Capital Corporation and the Clinton campaign’s fundraising chair, a report revealed that Clinton had loaned her campaign $6.4 million dollars. Not good news! She did this several months ago when she gave the campaign a $5 million dollar loan.
On the other hand the Obama camp is flying high and breaking the mold on the Internet. This morning, Jeh Johnson — Obama National Finance Committee Member — talked about the strength of the Internet, last night’s victory and why Obama hasn’t recently hosted a fundraising New York. Here are a few notable soundbites:
“Obama has raised $234 million dollars from 1.5 million donors.”
“In March he raised $50 million on the internet and did not host one fundraiser in New York.”
Watch the video below:
Part I
Part II
