Rob Black's "Winners & Losers" June 13 Amazon Adds MGM, Dimon Fires Back & P. Alto Hates Facebook

By: Rob Black - Wed, 13 Jun 2012 17:35:35 -0800

Loser: Stocks Drop Amid Europe & Weak  Retail Sales

U.S. stocks slid, after yesterday’s gain, as retail sales fell and concern about Europe’s debt crisis grew amid higher borrowing costs in Italy and Germany.

Nine out of 10 groups in the Standard & Poor’s 500 Index retreated as consumer discretionary, commodity and industrial shares had the biggest losses.

Trading volume was 10 percent below the three-month average.

Consumers are starting to question the validity of this recovery and beginning to plan for tougher times.
 At the same time you have global austerity. You’re getting more recessionary pressures throughout Europe and borrowing costs are moving higher. Things are deteriorating.

Investors also watched the latest developments ahead of Greece’s elections on  Sunday June 17.

Winner: Dimon Fires Back at U.S. Senate

JP Morgan CEO Jamie Dimon spent  much of his time at a hearing where U.S. senators aimed to put him on the defensive firing back at the federal regulatory system.

Dimon described a $2 billion loss in the bank’s chief investment office as a hedge that “morphed into something I can’t justify”.

Dimon largely blamed subordinates for a trading strategy gone wrong.

The bank is looking at clawing back some of the compensation earned by those responsible.

At the same time, Dimon, one of the most vocal bankers in challenging stricter regulation, said of the so called Volcker rule, which bans proprietary trading for a bank’s own account.

“It’s going to be very hard to make a bright-line distinction between proprietary trading and hedging, because you can look at almost anything we do and call it one or the other,” Dimon said.

The regulatory system in the wake of the 2010 Dodd-Frank overhaul is “really complex,” he said.

Loser: Faceobook Hurt Palo Alto Housing

Prices in Silicon Valley's tony neighborhood soared before the Facebook IPO.

Now inventory is soaring.

You can take the pulse of the prospects of Silicon Valley by checking stock prices, revenues, profits, hiring, even press clippings of various companies. Or instead maybe you should just look at the real estate market in Palo Alto, California.
 
The shortcomings of Facebook, now seem to be taking their toll in Palo Alto.

Before Facebook's May 18 IPO Palo Alto’s housing market was going especially bonkers. Sellers kept their homes off the market.

For the first quarter of this year, for example, the median price of a single-family Palo Alto home went up 11% while inventory declined 57%.
 
All that changed when the Facebook IPO flopped.

The result in Palo Alto has been a flood of houses going on the market. It's a small set of data. Right now, there are 104 houses on the market -- more than double the number over the winter . Even compared to last June, inventory is
up 44%.
 
Winner: Amazon Adds MGM to Video-Streaming Service

Amazon.com forged a licensing agreement with Metro-Goldwyn-Mayer Studios, letting the online retailer add “The Silence of the Lambs,” and hundreds of other movies and TV shows to its Internet video service.

Amazon’s Prime Instant Video catalog now includes more than 18,000 films and TV episodes.
Users can watch the programs on their computers, Kindle Fire tablets or other devices.

The MGM catalog, which includes “Terminator,” “Dances With Wolves” and “Rain Man,” will help Amazon’s video service compete with rival offerings from Apple  and Google, and Netflix.
MGM offers one of the most distinguished catalogs in all of Hollywood.
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