Early Edition December 08 2008 at 02:53 AM Harry Maurer
Tribune Co. Mulling Bankruptcy
The Tribune Co., the media conglomerate bought by real estate mogul Sam Zell in a leveraged deal last December, has hired advisers to assist with a potential bankruptcy filing. The company continues to try to restructure its debt agreements with lenders, as declining cash flow puts it in danger of being in default of its loan convenants. Zell bought Tribune just as newspapers' businesses collapsed, and that collapse has been particularly pronounced for the big-city dailies found in Tribune's portfolio. Tribune newspapers' ad revenues dropped 19% in the third quarter of this year.
A cornerstone of Tribune strategy was to sell the company's Chicago Cubs baseball team, but the recession has hit asset valuations in sports teams. Tribune had counted on selling the Cubs to give it breathing room with its interest payments: Around $1 billion is due this year and $512 million is due next June.
Source: BusinessWeek
Obama Supports Compromise Detroit Bailout
President-elect Obama expressed support for an emerging deal between Congressional Democrats and the Bush Administration to provide some $17 billion in bridge loans to the automakers. However, pressure is building on auto executives, with Obama criticizing their "head-in-the-sand approach" and Senate Banking, Housing and Urban Affairs committee chairman Christopher Dodd saying GM CEO Rick Wagoner "has to move on."
Source: CNNMoney
U.S. Ties Pakistan's ISI to Mumbai Terrorists
U.S. officials say the Pakistani government's intelligence agency has helped Lashkar-e-Taiba, the group suspected of the Mumbai terror attacks, gain strength in recent years, allowing it to train and raise money. Although American intelligence and counter-terrorism officials say there is no hard evidence to link Pakistan's Directorate for Inter-Services Intelligence (ISI) to the attacks, they say ISI has helped Lashkar by providing it with intelligence and protection. Early on Sunday morning, Pakistani militants attacked a NATO convoy carrying supplies to forces in Afghanistan, destroying 96 trucks.
Source: New York Times, Reuters
'Four Christmases' Rules on Slow Box-Office Weekend
The weekend after Thanksgiving is traditionally a slow time for Hollywood, and this year was no different. "Four Christmases" dropped 41% from last week but still was No. 1 at the box office with $18.2 million. Among the also-rans: "Australia," with just $7 million. After its lackluster Thanksgiving debut, the Fox picture has generated only $30.9 million at the box office.
Source: Variety
Taiwan Considering Bailout for Memory-Chip Makers
Taiwanese producers of DRAM may be in line for a government rescue, with Taiwan President Ma Ying-jeou's administration considering offering loan guarantees or rolling over existing loans. The island's chipmakers account for one-third of the world's production of DRAM; the companies are struggling as memory chip prices have plunged significantly below the cost of production.
Source: Financial Times
Biggest Infrastructure Program Since Ike, Obama Pledges
In his weekly radio and Internet address, President-elect Obama said he plans the biggest public-works program since the 1950s. Obama said his spending program, the largest since the creation of the interstate highway system under Eisenhower, would include projects to improve schools, highways, hospitals and broadband connectivity. "We need to act with the urgency this moment demands to save or create at least 2 1/2 million jobs so that the nearly 2 million Americans who've lost them know that they have a future," the President-elect said.
Source: Washington Post
Stocks Rise in Asia, Europe
Optimism about Obama's plans to stimulate the U.S. economy helped boost stocks in Asia and Europe on Monday. The MSCI Asia-Pacific Index closed up 4.3% and Europe's Dow Jones Stoxx was up 5.5% in early trading.
Source: Bloomberg
Merger Talks End for NYSE Euronext and Deutsche Borse
Germany's Deutsche Borse released a statement on Sunday night to put an end to speculation it was in merger talks with NYSE Euronext that would have created the world's largest stock exchange. Earlier, a German magazine had reported Deutsche Borse executives had met with officials from NYSE Euronext recently to discuss a deal. In its statement, Deutsche Borse said "if such talks were held with NYSE, they have ended without any result".
Source: Times of London
Layoffs Flood a Weakened Unemployment System
Worker advocates and some economists are worried that the unemployment insurance system has not kept pace with demographic shifts in the work force and leaves too large a percentage of workers ineligible for benefits. Just 37% of jobless U.S. workers are covered by unemployment insurance, down from 42% during the 1981-1982 recession and 50% during the 1974-75 downturn. "When only 4 in 10 have access to a safety net, that safety net is pretty weak," says Sharon Parrott, senior policy analyst for the Center for Budget Priorities, a research and advocacy group in Washington.
Source: BusinessWeek
More Restructuring at NBC Following Ousting of Executives
With networks anticipating big cuts in ad budgets next year, NBC this week will announce the merger of its two programming groups. The move comes after NBC, in last place among the four networks, on Friday fired three top programming executives following the GE-owned network's dismal start to the current season.
Source: Los Angeles Times
In Your Face: Bailout Blues
Reader Bob L writes: "Why don't all the overpaid executives and brokers who approved these bad loans return the money they made? They can't be tried for stupidity, but they should be tried for fraud."
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