Last Call - Peter Pan and the Fiscal Cliff
"We don't know what we're talking about in terms of actual legislation to increase revenues. It's magic beans and fairy dust."
― Jay Carney, White House Spokesman on GOP proposal
"All the world is made of faith, and trust, and pixie dust."
― J.M. Barrie, Peter Pan creator
Below, fairy dust enters the fiscal cliff dialogue as we get another day closer to the edge. Still waiting on faith and trust.
Market Musings with CNBC Market Guru Robert Hum
Recap: Dow -13.82 (-0.11%) at 12951.78, S&P -2.41 (-0.17%) at 1407.05, Nasdaq -5.51 (-0.18%) at 2996.69
Major averages come off mid-afternoon lows, but still close with small losses.
Little momentum as Nasdaq closes down for 3rd straight day.
Hovering around the flat line much of the day: Dow crossed the UNCH line 77 times (h/t to S&P Dow Jones Indices).
Gold falls below $1,700 for the first time in about a month on some concerns over Chinese demand for precious metals.
Another Precious Dividend - Apalooza Day
Cognex accelerates dividend payment.
ePlus declares special dividend.
Kansas City Life declares special dividend.
Maiden Holdings accelerates dividend payment
Intrepid Potash declares special dividend.
Pike Electric declares special dividend.
Covidien accelerates dividend payment.
MSA declares special dividend.
Eaton Vance declares $1/share special dividend.
Paccar Announces special dividend.
Bon-Ton Stores Announces accelerated dividend payment.
American Eagle accelerates payment of first quarter dividend into this month.
Campbell Soup Accelerates quarterly dividend payout.
The Word on the Street Tonight
Facebook To Be Added to Nasdaq 100/CNBC - Bertha Coombs: "Facebook will be added to the Nasdaq 100 index ahead of the open of trade on December 12th, roughly seven months after the social networking giant's IPO. In a widely expected move, Facebook will replace tech services firm Infosys, which is switching its listing to the New York Stock Exchange. While Facebook's total market valuation is close $60 billion, roughly half of its shares outstanding are privately held. At nearly $30 billion, the value of its publicly floated shares will put the social networking firm among the top 25 most valuable companies within the NASDAQ 100 index."
The Future of TV? Netflix Scores Massive Disney Deal/CNBC – Julia Boorstin: "Netflix shares skyrocketed on Tuesday after the streaming video service announced it scored an exclusive deal with Disney to stream its movies. This is a huge deal for Netflix—giving it the same kind of access to content that was previously reserved for pay-TV channels like Starz, Showtime, HBO, and Epix. It also shows that Netflix is willing to pay up for premium content in order to compete with premium cable TV channels, and it must have paid up, otherwise Disney would have gone with one of its many other options."
Big Lots Chief Probed by SEC/WSJ – Susan Pulliam & Jean Eaglesham: "The Securities and Exchange Commission launched an inquiry into a $10 million sale of stock by Big Lots Chief Executive Steven Fishman before the company announced news that sank its stock, a person familiar with the inquiry says. Big Lots said Tuesday that Mr. Fishman, 61 years old, intends to retire in order to spend time with his family. The discount retailer said it hadn't been contacted by the SEC and that the timing of Mr. Fishman's departure was coincidental to any regulatory interest. The company said his trades were "properly made" at a time when they were allowed by the company. Mr. Fishman didn't return calls seeking comment. Mr. Fishman's trading of Big Lots stock in March was cited in a front-page article in The Wall Street Journal last week. The article highlighted trades by corporate executives that were highly beneficial and occurred just before bad news hit, which spared the executives large price drops in their holdings."
Clerks Bring L.A. Port to a Halt/WSJ – Erica Phillips: "…The work stoppage at the twin ports of Los Angeles and Long Beach has choked off container-shipping traffic and left many of Mr. Patterson's workers and facilities idle, prompting his Pacific Mountain Logistics LLC to lay off 20 of its 43 workers. By Wednesday Mr. Patterson expects to have more than 270 shipping containers caught in the backup. He is discussing diverting freight with his clients, who import everything from tropical fruit to patio furniture. The business is one of many feeling the effects of the strike, which started last week. The two ports account for roughly 40% of the value of imports brought to the U.S. in shipping containers, and they are an important link in the supply chain that delivers Asian-made goods, including massive amounts of merchandise from China, to U.S. consumers. On Tuesday, following talks that lasted through the night, port workers and their employers said they had agreed to federal mediation."
Investors 'Should Get Used to 1-2% Growth': Pimco's Gross/CNBC – Justin Menza: Investors should get used to one to two percent economic growth for the foreseeable future, Pimco's Bill Gross told CNBC's "Street Signs" on Tuesday. "We think that the United States is in a one to two percent growth environment going forward and investors should get used to it" as structural challenges keep growth in check, the Pimco co-founder and co-chief investment officer said. Earlier Tuesday, Gross released his final investment letter for 2012, where he continued to warn about slower economic growth due to ongoing structural challenges such as high debt levels, a slower growing China and an aging workforce."
McAfee Says He Is in Guatemala/WSJ – Nicholas Casey:"John McAfee, the antivirus mogul on the run from authorities in Belize, said Tuesday in a blog post that he is now in Guatemala where he plans to meet with the government. Mr. McAfee, 67, founded the security-software company that is now McAfee Inc. He is wanted for questioning in Belize in connection to the suspected murder of his neighbor Gregory Faull who was found dead at his home on Nov. 11. In the blog, which Mr. McAfee has maintained from hiding, he said he had crossed the border into Guatemala and would be meeting officials there. "It was not easy to exit Belize and required many supporters in many countries," he wrote."
Pandora CEO Blames Advertiser Caution, Fiscal Cliff for Downbeat Guidance/WSJ – Don Clark: "Pandora Media Chief Executive Joe Kennedy blames the company's disappointing fiscal fourth-quarter revenue guidance on the attitude among the Internet radio company's advertisers about the fiscal cliff and other economic concerns. "As we see that caution, our visibility goes down, and we have to be more cautious," Mr. Kennedy said in an interview. …Pandora shares fell 18% to $7.75 in after-hours trading. Through Tuesday's close, the stock is down 23% over the last three months."
More Bad Headlines for Dreamliner – Please note – The fuel line directive is NOT related to the emergency landing in New Orleans today.
Boeing 787 in emergency landing as inspections ordered/Reuters: On the same day that one of its new 787 Dreamliners made an emergency landing because of a mechanical problem, Boeing said that U.S. regulators would require the entire fleet of 787 jets to be inspected for a possible fuel line problem. The twin mechanical issues, while not necessarily uncommon, were yet another headache for Boeing, a company still working to overcome the negative perception of production problems that delayed delivery of the 787 by 3-1/2 years. The company said the U.S. Federal Aviation Administration is requiring inspections of all 787s in service to confirm that fuel line connectors have been properly installed. The FAA requirement, due to be issued Wednesday in an airworthiness directive, "makes mandatory inspections already recommended by Boeing," the company said in a statement."
Hype Better Than Sales for Target-Neiman Marcus Tie-Up/WSJ – Ann Zimmerman: "The unusual designer fashion collaboration between Target and Neiman Marcus Group Inc. began with a whimper this past weekend, according to analysts, far from the bang the companies were counting on to improve holiday sales. … But Wall Street analysts and customers alike expressed surprise that crowds weren't bigger and sales not stronger at many locations, despite a spate of high-profile advertising, including prime-time television commercials. The tie-up clearly fell short of the buying frenzy that Target saw last year when it offered a limited collection by high-end Italian design house Missoni that sold out in most stores within minutes and drew so much traffic online it crashed Target's website."
Intel Borrows $6 Billion To Help Fund Stock Buyback/WSJ – Patrick McGee & Kate Linebaugh: "Computer-chip giant Intel . is borrowing $6 billion in part to buy back stock, as U.S. companies continue to make use of forgiving debt markets to make bigger payouts to their shareholders. Many companies are electing to take advantage of low interest rates to borrow money in the U.S. for share buybacks and dividends, while leaving cash balances held abroad untouched because bringing those funds would trigger a big U.S. tax hit. Foreign income is taxed at a 35% rate, less the tax paid in a foreign jurisdiction. It is much more expensive than borrowing domestically. By comparison, Intel is paying interest rates ranging from 0.75 percentage point to 1.50 points over the rate on comparable Treasury bonds to borrow via debt with terms of five to 30 years, according to a term sheet from one of the underwriters."
Egyptians Surge Against President's Palace/WSJ – Charles Levinson & Sam Dagher: "Tens of thousands of Egyptians tore through cordons of barbed wire and riot police and surged against the gates of the Presidential Palace in Cairo on Tuesday, as anger mounted over what they called a power grab by the country's Islamist president. Tuesday's demonstrations ended with protesters massed at the palace walls and police stationed inside—echoing the standoff that now pits Egypt's ruling Islamists against nearly every other political force over the country's hastily drafted constitution and President Mohammed Morsi's recent decree granting himself nearly unrestricted powers. …With protesters threatening to storm the palace walls for the first time in recent Egyptian history on Tuesday, Mr. Morsi left the palace to his home in a remote Cairo suburb, according to a Muslim Brotherhood spokesman."
Woman Accused of Robbing Bank and Bragging About It on YouTube/NY Times- Nick Bilton: "This might seem obvious to some, but here's a little life tip: If you steal a car and then rob a bank at gunpoint, don't brag about it in a video on YouTube. Hannah Sabata, a 19-year-old from Nebraska, stands accused of doing this very thing. A YouTube user named Jellee Beanie, who the authorities say is Ms. Sabata, posted a seven-minute video last week bragging about a robbery of a Cornerstone Bank in Waco, Neb., where the county sheriff says Ms. Sabata stole $6,000. Dale Radcliff, the York County sheriff, said in a phone interview that he had already arrested Ms. Sabata by the time residents started notifying him about the video."
Missouri Farmers Fight Rise In Hay Thefts/KMOX – "…Missouri Farm Bureau president Blake Hurst says thieves are actually targeting those big bundles of hay that are left out in fields prior to being harvested, hauling them off and selling the valuable commodity. "Of course, no one brands their hay so if you hook onto it with your tractor or your pickup and make it out the gate, then it's impossible to prove where the hay came from," Hurst said."