Bloomberg Anywhere Remote Login Bloomberg Terminal Demo Request


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Bloomberg Customers


Talk Show

"What'd they use to call Chicago—the hog butcher of the world? We are now the risk managers of the world."—Retired Chicago Mercantile Exchange Chairman Jack Sandner on the Merc's planned purchase of the Chicago Board of Trade for $8 billion, as reported in the Chicago Sun-Times

One of The Street's longest hot streaks looks as if it's about to end. Bill Miller, whose Legg Mason Value Trust (LMVTX)mutual fund has beaten the total return of the Standard & Poor's 500-stock index for a record 15 calendar years (nearly twice as long as his nearest rival), is trailing badly this year. Miller was behind by 12.1 points at the third quarter's end, after the S&P had racked up an 8.5% return of price gains and dividends against Miller's 3.6% loss, according to fund analysts at Lipper.

The fund has not been this far behind going into the final quarter since 1987, though Miller did overcome gaps of 3% and 4% in 2005 and 2004, respectively. His biggest losses seem to have come from holding (AMZN), Yahoo!, (YHOO) and eBay (EBAY), all down more than 30%. He's also been hurt by the troubled Sprint Nextel merger, UnitedHealth's (UNH) option scandal, and homebuilders' weak results. Adding insult, one of the few stocks he's apparently sold, Intuit (INTU), is up 33%.

Miller has long warned investors that his streak will end someday. Early this year he noted that calendar years are the only 12-month periods in which his results always beat the S&P. Besides, says Mary Chris Gay, his assistant portfolio manager, he picks stocks for their three- to five-year returns. Give the market time, she says, and it should see prices his way.

The legal tab for defending Enron CEO Jeffrey Skilling, who is due to be sentenced in federal court in Houston on Oct. 23, is shaping up to be one of the priciest in criminal defense history. Before his indictment, Skilling put $23 million into a trust for legal fees. His lawyer, Daniel Petrocelli, got that, along with $17 million from the insurers that provided Enron with directors' and officers' liability coverage. And Petrocelli says in court filings that his Los Angeles-based firm, O'Melveny & Myers, is owed $30 million more, bringing the grand total to $70 million, an amount that astonishes other attorneys. "It's magnificent, it's shocking, I'm jealous," says Philip Hilder, who represents Enron whistleblower Sherron Watkins. Quips Enron shareholder attorney Bill Lerach: "What would he have been paid if he had won?"

Petrocelli justifies the expense. Skilling's criminal case, he says, took a team of 12 lawyers, 5 paralegals, and temporary staffers, many of whom had to be housed in Houston for months. He billed his own services at nearly $800 an hour. Some expert witnesses made $600 an hour. A dozen staffers were devoted just to paperwork, including over a billion pages of documents. Petrocelli also points out that he's represented Skilling for a total of five years, in appearances before Congress and the Securities & Exchange Commission and in several civil suits. A case like Skilling's, Petrocelli says, "requires a small infrastructure of its own to litigate."

Average annual CEO pay is $10.5 million, 369 times average worker pay of $28,310. In 1970, before the big runup, the multiple was 28:1, a ratio that would make today's average worker pay $374,800. Put another way: If CEO pay were frozen now, it would take workers 66 years of 4% annual raises to get back to 1/28th of what the boss makes.

Data: Kevin J. Murphy, University of Southern California; CEO pay rounded and based on S&P 500 companies; worker pay, Bureau of Labor Statistics; ratios rounded to nearest whole number

Some Mexican citizens convicted of a crime in the U.S. are getting something beyond hard time and deportation: homework. Corrections Corp. of America (CXW) has been running schools for the 5,000-plus Mexican nationals incarcerated at its private prisons in California, Colorado, New Mexico, Oklahoma, and Texas.

The aim: getting inmates to stay in Mexico once they're released and deported. The curriculum, says Dennis Bradby, CCA's vice-president for inmate programs, is one way to inject skilled workers into Mexico. "Therefore, there will not be a need [for the former inmates] to come back to this country," he says.

The Mexican government provides books, computers, and curriculum guidance for the classes -- in math, reading, writing, and trade skills. (The course follows the requirements of Mexico's public education system.)

Running the program costs CCA about $230,000 a year for in-house teachers and inmate tutors. Some 3,700 Mexican inmates have graduated from the CCA elementary, junior high, and general equivalency diploma programs, including 500 in September. Since the classes were started by the prison corporation in 2003, the Mexican government has expanded the program, which is conducted in Spanish, to 29 other public and private prisons.

Mexican officials don't have statistics on how many graduates avoid criminal pursuits or find jobs back home after graduation. But, says Juan Solana, Mexican consul in Albuquerque, N.M., most Mexican immigrants say they would prefer to stay home, despite the high numbers who come into the U.S. illegally. Says graduate Francisco Sanz, 34, who will be deported next spring after doing time for acting as a drug courier: "When you have a job, you don't want to come back." Solana says more Mexican prisoners in the U.S. finish the program than U.S.-based Mexican civilians studying the same courses in community centers. "These people have a lot of time," he says.

The four-man band from Down Under that is wildly popular with the four-and-under set, the Wiggles, already has a TV show that airs twice daily in the U.S. on the Disney Channel (DIS) as well as brisk video and DVD sales. Now the group is wiggling its way into more of the American market. On Oct. 17 the first U.S. Wiggly Play Center opened in a Dallas suburb.

The nutrition-minded band plans to franchise these romper rooms, which feature party facilities and a healthy food café. "Everything is baked, not fried," says Anthony Field, aka the Blue Wiggle.

Positive thinking may not always be a plus. According to a study by University of Washington B-school assistant professor Christina Ting Fong, ambivalent feelings -- the simultaneous anxiety and excitement of starting a new job, say -- may result in enhanced creativity. Fong divided about 100 students into four groups to write about life events that made them feel either happy, sad, neutral, or ambivalent. (Another test later assessed whether participants in each group felt the desired emotion.) The students then took the Remote Associates Test, a commonly used measure of creativity. Those who felt ambivalent came out on top. Complex emotions, theorizes Fong, may lead to complex thinking.

What's the link? MIT neuroscience professor John Gabrieli explains it this way: Problem solving requires access to all our mental resources, and an ambivalent state broadens thinking, perhaps allowing us "to cast a wider net" over the information in our brains.

Burger King (BKC) has been flame-broiling Whoppers since 1957. But if Whitney Leeman has it her way, the chain will have to post notices in California that its Triple Whoppers contain excessive levels of a suspected carcinogen. She'd also like a side of civil penalties with that.

Leeman, an environmental engineer from Sacramento, has sued dozens of companies under Proposition 65, a 1986 law requiring that vendors disclose ingredients the state has identified as having links to cancer or birth defects. Companies that don't tell can be sued, and under Prop 65 anyone can be a plaintiff.

In April, after Leeman found companies selling soda in bottles labeled with lead-based paint, authorities in the state won $2.25 million from PepsiCo (PEP). In July, she sued Burger King and CKE Restaurants, (CKE) parent of Carl's Jr., for not warning of polycyclic aromatic hydrocarbons in flame-broiled meats.

What makes Leeman sue? Money, say some defendants. Her suits have brought three dozen settlements totaling $11.4 million in fines. Prop 65 lets plaintiffs get up to 25% of the penalties. Her take comes to $385,550, says Clifford Chanler, a partner at law firm Hirst & Chanler who regularly represents Leeman. Charles Seigel, general counsel at Carl's Jr., calls her a "bounty hunter" whose "modus operandi is to make unfounded allegations, try to collect a quick settlement, and move on." Seigel says the company will prove in court that its burgers are safe. Burger King declined to comment.

Leeman, 39, with a PhD in dioxin research, says she just wants to protect consumers and that her portion of penalties comes to $64,000 a year before expenses -- such as research to prove the presence of harmful compounds. She works, rents "a tiny house," and drives an old Subaru. "I am not a rich person," she says, adding that companies she has sued have agreed to use safer ingredients.

Edward G. Weil, California supervising deputy attorney general, calls Leeman one of the most prolific litigants of the 2000s, but he thinks she's sincere. "She is not empire-building," he says.

Ads are moving into what may be the last commercial-free space at the supermarket: the checkout conveyor belt. EnVision, a Little Rock marketing company, prints ads on custom-made plastic belts and has placed them in several southern chains, including Harps Food Stores in Arkansas.

Frank Cox, enVision's CEO, sees the checkout conveyer as "real estate that wasn't used effectively before." Cox is in preliminary talks with stores in other U.S. regions, as well as in Canada and Mexico. He is trying to broaden the ad mix -- which currently ranges from local banks and hospitals to mobile provider Alltel (AT) -- to include snacks and magazines, both common impulse buys at the counter.

Supermarkets get a percentage of the ad revenues or a flat "rental" fee. And cleaner counters: EnVision does biweekly conveyer upkeep and plans to install new ad-laden belts every three months.

It's almost as if GM (GM) and Nissan (NSANY) had joined up after all. The two auto giants are running startlingly similar ad campaigns this month. Targeting young buyers, both aim to show that their less-expensive models -- a 2007 Chevy Aveo in GM's case, a 2007 Sentra in Nissan's -- are roomy enough to live in. At least for a week.

Chevrolet's "Livin' Large" campaign, run by its in-house communications people and slated to launch on Oct. 23, will feature two-person teams at eight colleges, from Boston University to the University of Southern California. Instead of a dorm room or apartment, each duo (selected from about 400 applicants) will live for five days in the 90.7-cubic-foot interior of an Aveo (which also has about 12 cubic ft. of trunk space). Mounting the occasional stunts, the teams will vie for the most hits on Chevy's 24-hour Web broadcast of their living quarters. New Aveos await the winners.

Nissan's "7 Days in a Sentra" campaign, handled by TBWA/Chiat/Day, Nissan's agency, aims at a slightly older (20-to-30-year-old) market. The ads feature Marc Horowitz, a photographer's assistant and video blogger who comes home each night to a Sentra (97.7 cubic ft., 13.1 cubic ft. in the trunk) instead of his Los Angeles apartment. The 30-second TV spots, online video clips, and blog entries began airing on Oct. 16. In them, Horowitz is shown having pizza delivered to the car, playing cards with buddies, waking up in his bathrobe. "There was very little scripting," says Michelle Erwin, a marketing manager at Nissan.

Chevrolet spokesman Travis Parman shrugs off the similarity of the campaigns. "Ours is more peer-to-peer," he says, adding that the idea for it was largely generated by students as part of a PR competition held in April by the Public Relations Student Society of America, whose chapters are helping coordinate the campaign at the campuses.

David Smith, CEO of media planner Mediasmith, says living out of a car for a week is "not that far from reality" for some students. And both campaigns, he says, may resonate with commuters, whose average car time has grown along with traffic. Still, he cautions, "automotive folks have yet to find an appeal to get to 18-to-20-year-olds," who usually can't afford cars. Of the two, Chevy's campaign carries the "greater risk," he figures, because there's less control. On the other hand, he notes, "If something wild and crazy happens, it has the potential to hit a home run."

Does the rapid rise of YouTube, the 18-month-old video-sharing site recently bought by Google for $1.65 billion, portend a radical change in the media landscape?

"People who think it's replacing television- that's just crazy. You don't make a commitment to YouTube, like 'It's my YouTube time.' It's on the margin, more like checking your e-mail." -- Mark Cuban, Internet entrepreneur; owner, Dallas Mavericks

"I would say there's a damn good chance to get around [copyright issues] at this point. Content wants to go where eyeballs are aggregated. You're already seeing traditional media guys start to break and cut deals." -- David Sze, partner, Greylock Partners

"Google and Yahoo! are the new distributors. The key over time is going to be what kind of content deals get struck. We're only in Round 1. [YouTube] is not going to set the terms for how content is distributed forever." -- John Battelle, founder, Federated Media; co-founder, Wired

blog comments powered by Disqus