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The Final Fate of Fannie and Freddie
Partial bailout or full-on takeover, here's how the rescue of the troubled government-sponsored enterprises could ripple through the financial system.
The Final Fate of Fannie and Freddie - BusinessWeek

Freddie Mac or Big Mac?
What should you do with that $5 bill -- indulge your fast-food craving or invest in one of America's mightiest enterprises? We'll help you decide.
Freddie Mac or Big Mac? - BusinessWeek

The Best (and Worst) Ways to Raise Fast Cash
What credit crunch? Here are 17 ways to get your mitts on some money, ranked from best to worst. The best is to tap your emergency fund (that is what is there for) and the worst is to get a payday loan.
The best (and worst) ways to raise fast cash - Money Magazine

Americans drove 12.2 billion miles less in June than they did a year ago, according to the Federal Highway Administration.The number is too big to fathom. It is probably like driving to the Moon and back 876 times, or some other absurd analogy.

What is certain is that the trend puts a downward pressure on gas prices and could be a factor in per gallon costs going back toward $3. For any company in a business that relies on drivers, though, the driving less trend is bad news.

Hotel and motel company stocks are likely to get hit fairly hard because drivers are staying off the road. It probably does not help fast food places like McDonald's (NYSE: MCD) either. Retailers, including Wal-Mart (NYSE: WMT), are certain to be hurt, but online shopping at retail websites may soften that blow.

Of course, car companies get hammered. People who don't drive don't need new cars. Operators of oil change outlets will probably have a bad year. The same holds true for tire companies.

Put another way, the economy might be better served if drivers would get back in their cars.

Douglas A. McIntyre is an editor at 247wallst.com.

TheStreet.com's Jim Cramer says that as consumers try to stretch their dining dollar, Darden, Yum! and McDonald's will benefit.

We all know we are overstored in this country and over-restauranted. There are tons of players -- so many that the competition got too hard. Now they collapse. That Uno might miss a payment, that Bennigan's and Steak & Ale are going away, that Bakers Square and Village Inn have filed for bankruptcy: All say the industry is in big trouble.

But ask yourself, if you are Darden (NYSE: DRI) (Cramer's Take), do you think this is a good or bad development? If you are Yum! Brands (NYSE: YUM) (Cramer's Take), do you think that this, at last, is your time? How about McDonald's (NYSE: MCD) (Cramer's Take)? Room to go more upscale, perhaps?

We read all of these horrible articles every day about restaurants, and yet we see that the stocks of Yum! and Darden hang in great, particularly the first, which gave hideous guidance and yet is now higher than it was before it told people commodity costs were hurting it. McDonald's? How many stocks just hit their 52-week high?

Is it the thrill of victory to hear the sound of one hand clapping?

Advertisers who paid big bucks for Olympics sponsorships are wondering the same thing. According to the Wall Street Journal, companies are angry that access to the Olympic Green, which is the main focal point of most games, has been "strictly limited" to people with hard-to-get tickets to the venues.

"A small line of people stood outside the The Coca-Cola Company (NYSE: KO) exhibit, where dry ice and the sound of gurgling soda pop drifted out," the paper said. "Meanwhile, a giant restaurant erected by McDonald's Corporation (NYSE: MCD) at the end of the Green has been far from packed."

This, of course, could be a huge disaster for the International Olympic Committee, which counts on corporate funding to fund the games. This could also hurt television advertising by General Electric Company (NYSE: GE)'s NBC Universal division, because televised shots of half-empty stadiums may make whatever sporting event they are showing seem lame.

Overall, though, the games are attracting huge audiences worldwide because of compelling stories such as swimmer Michael Phelps' quest for Olympic immortality. It will be interesting to see if the viewership trails off once the swimming competition ends.

Advertisers are going to take note of this for when the IOC comes calling for the London games in 2012.

This post is one in a series on prominent company nicknames. See all 25, and share your thoughts and memories about Mickey D's below in the comments.

Should you ever doubt that I was born and bred a United States citizen, let the following anecdote erase all skepticism. Flashing back to 1983 for a moment, we find my 2-year-old self in my dad's old Plymouth station wagon. We're on the way to pick up my sister from Montessori school, and I'm riding in the front seat (a flagrant violation of my mother's car-seat rule, not to mention Ohio state law). From my shotgun perch, I have a clear view of the windshield wiper knob for the first time ... and, to my toddler's eye, the button atop this lever screams one message: McDonald's (NYSE: MCD).

That's right; I thought that the familiar wiper-fluid icon, with its two arches fanning out from one central stem, was somehow related to America's premier fast-food export. My quickly formed hypothesis went something along the lines of, In case of emergency, press here, and the Golden Arches will appear on the horizon. (Are you listening, automakers? The future is now!) As formative childhood memories go, this one blissfully passes up Freud and heads straight to Jung.

It might sound like an exaggeration, but the Golden Arches are nothing if not archetypal. Sure, there are other notable arches in the world; the Gateway Arch in St. Louis springs to mind, as does France's Arc de Triomphe, and the reasonable facsimile thereof in New York City's Washington Square Park. But, I ask you, is there another parabola in the world that so effortlessly communicates the same message in Beijing as it does in Cincinnati?

U.S. stock futures were mixed Tuesday morning following more negative news out of the financial sector: J.P. Morgan announced a $1.5 billion write-down, UBS a loss, while Wachovia and Morgan Stanley are dealing with auction rate securities. However, oil futures declined further to near $113 a barrel, offsetting financial sector woes and pushing stock futures higher. Russia halted its attacks on Georgia, signaling a cease-fire could come near.
[Update 9:09: Seems lower oil wasn't enough to offset financials' concerns and futures now indicate stocks could start flat to lower.]

JPMorgan Chase (NYSE: JPM) said in a filing with the Securities and Exchange Commission that it suffered more substantial third-quarter losses related to the hard-hit mortgage sector than it did in the second quarter and had to take a $1.5 billion write-off on mortgage-backed securities and loans.

UBS AG (NYSE: UBS), one of the hardest hit banks in the subprime mortgage crisis, said Tuesday that it had further losses and writedowns of $5.1 billion during the second quarter of 2008.

Morgan Stanley (NYSE: MS) said late Monday that it will offer to buy back up to $4.5 billion of auction-rate securities from retail clients, following similar announcements from rivals. The broker also said it will make whole any losses suffered by retail clients who bought auction-rate securities through the firm and try to provide liquidity solutions for institutional investors.

Wachovia (NYSE: WB) said Monday it plans to cut 600 more jobs than it previously expected as it works to reduce expenses in the face of staggering losses tied to mortgage debt. It also revised lower its second-quarter loss by $500 million pretax due to auction rate securities settlements.

McDonald's (NYSE: MCD) was cut to Neutral at UBS, according to MarketWatch.

JP Morgan upgraded AMR (NYSE: AMR), Continental (NYSE: CAL), and US Air (NYSE: LCC) to Overweight from Underweight, according to Briefing.com. The news service also writes that Deutsche Bank downgraded Goldman Sachs (NYSE: GS) to Hold from Buy.

JPMorgan Chase (NYSE: JPM) was started as Outperform at Bernstein, according to 24/7 Wall St.

This post is one in a series on prominent company nicknames. See all 25, and share your thoughts and memories about BK below in the comments.

Is there any advertising icon more creepy than the Burger King (NYSE: BKC) King? I get nightmares myself every time the mascot appears on the small screen. My opinion, though, may be in a minority since the character seems to be wildly popular.

Unlike McDonald's (NYSE: MCD), Burger King isn't afraid to be edgy and even annoying. I always have to turn the volume down on my TV whenever a BK spot is on the air or my ears will start to bleed otherwise. Burger King tried being like McDonald's and got its butt kicked. I am old enough to remember when the king was a cuddly cartoon. That strategy has now shifted and all of the in-your-face marketing appears to be paying off.

Shares of the number two burger chain are up 17% over the past year as cash-strapped consumers forgo casual dining chains for fast food. Wall Street analysts consider the stock a buy. The company is expected to post earnings of 34 cents per share on revenue of $633.26 million when it reports results Aug. 21, according to Thomson Reuters. Those are respectable numbers especially given the current economic environment.

All is not completely calm in Whopper land. Franchisees are balking at new late-night hours, and the Miami company, like every food business, is being slammed by high commodities prices. But at the end of the day, Mel Brooks had it right in History of the World Part I: "It's good to be the king."

Stock futures were trading down as Fannie Mae posted its fourth straight quarterly loss. Investors were awaiting word from a government report on worker productivity to see if there is any sign of an economic rebound. Those figures, though, proved disappointing.

Bloomberg News reported that worker productivity in the U.S. grew at a lower-than-expected rate in the second quarter as employers cut jobs to weather the jump in raw-material expenses. "Employers eliminated 165,000 jobs from April through June to shore up profits, and still managed to get more output with fewer workers," the news service says. "Gains in productivity help lower inflation and bolster the Federal Reserve's forecast that prices will moderate."

Fannie Mae (NYSE: FNM) posted its fourth straight quarterly loss and slashed its dividend. The second-quarter net loss was $2.3 billion, or $2.54 a share. Excluding one-time items, the loss was $2.51 a share, compared with the 72-cent average estimate of 10 analysts in a Bloomberg survey. Shares tumbled more than 12% in pre-market trading.

In the News:
The Great Panic - One Year Later
On August 9, 2007, it became clear that fear had paralyzed the world's credit markets. The question was no longer only about the quality of assets or the availability of cash. Everything was suspect and no one was willing to take any chances. The world had turned subprime.
How the world changed on August 9, 2007 - Portfolio.com


Cell-Phone Health Concerns Persist
Despite years of study, questions continue to be raised whether mobile phones can contribute to health problems. Why can't we get a definitive answer about cell phones and health?
Why Cell-Phone Health Concerns Persist - BusinessWeek

Commodities prices are getting to McDonald's (NYSE: MCD), again. According to Reuters, "McDonald's Corp said on Thursday it was considering further price increases, but would do nothing that slowed customer traffic into its global network of stores."

That may be wishful thinking. In a recession, even modest increases in prices can drive consumers away in droves. The company will still have a Dollar Menu, but that dollar will buy a bit less in terms of food and drink.

McDonald's is indeed playing with dynamite if it tries to get a bit more money out of its customers. People can still buy a can of beans and eat at home.

McDonald's could make the choice of keeping prices level and taking slightly smaller margins. It could go to its investors and say that its operating income could fall by a modest amount because customer loyalty is more important long-term than earnings-per-share are short-term.

If it does those things, its shareholders should be happy.

Douglas A. McIntyre is an editor at 247wallst.com.

One 'Lettter' Stocks Offer Opportunity
Several companies with single-letter ticker symbols currently offer potential for value investors, says George Putnam. The editor of The Turnaround Letter stock publication highlights a number of single-letter stocks that have been "beaten down pretty badly and now look particularly appealing." They include Agilent ('A'), Citigroup ('C'), Ford Motor ('F'), Kellogg ('K'), Macy's ('M'), NetSuite ('N'), Qwest ('Q'), Spring Nextel ('S') and AT&T ('T').
'Singular' values: A, C, F, K, M, N, Q, S, T - BloggingStocks

August Trading Strategies
August is traditionally one of the worst months for the market. Against an already volatile backdrop, Experts show you 12 ways to navigate the dog days of summer.
http://www.marketwatch.com/newscommentary/tradingstrategies

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Amazon.com Inc. (NASDAQ: AMZN) net income nearly doubled, topping Wall Street estimates.
• American Express Co. (NYSE: AXP) Q2 earnings fell well short of analysts estimates on credit crisis.
• Amphenol Corp. (NYSE: APH) beat Q2 expectations and offered Q3 and full-year guidance.
• A.O. Smith Corp. (NYSE: AOS) beat Q2 earnings estimates and boosted its full-year guidance.
• Apple Inc. (NASDAQ: AAPL) beat Q3 estimates but offered lower-than-expected guidance.
• Bank of America Corp. (NYSE: BAC) Q2 earnings tumbled but still beat Wall Street expectations.
• Boeing Co. (NYSE: BA) Q2 results missed estimates but it reaffirmed its full-year guidance.
• Broadcom Corp. (NASDAQ: BRCM) crushed expectations but offered muted guidance.
• Caterpillar Inc. (NYSE: CAT) posted better-than-expected Q2 earnings and offered guidance.
• Ceragon Networks Ltd. (NASDAQ: CRNT) reported strong earnings on increased global demand.
• Charles Schwab Corp. (NASDAQ: SCHW) topped Q2 estimates on rises in new accounts and assets.
• CME Group Inc. (NYSE: CME) better-than-expected Q2 results lifted the share price from a 52-week low.
• Crocs Inc. (NASDAQ: CROX) revised its Q2 and full-year guidance downward on market conditions.
• EI DuPont de Nemours & Co. (NYSE: DD) Q2 results beat expectations due to strength in agriculture.
• Ericsson LM TEL Co. (NASDAQ: ERIC) Q2 profits tumbled due to costs of R&D and acquistions.
• E*Trade Corp. (NASDAQ: ETFC) had a bigger-than-expected Q2 loss on Fannie Mae (NYSE: FNM) losses.
• Ford Motor Co. (NYSE: F) posted a record quarterly loss, mostly one-time charges.

"Any further market weakness creates creates another opportunity to acquire some outstanding stocks," suggests Kelley Wright, noted for his focus on blue chip, dividend-paying stocks.

In his Investment Quality Trends newsletter, he looks at the benefits of keeping a long-term focus, the value of dividend districutions to an investor's long-term returns, and his current "timely ten" picks for conservative investor.

"The cash dividend for the Dow is $322.40. One year ago the dividend was $284.06. Amidst all the turmoil in the markets and the economy something must be going right with the Dow 30 companies because the dividend is ever climbing.

"Dividends, as we all know, can only come from the reality of earnings; you can't pay what you don't have. The dividend yield on the Dow is currently 2.66%, which represents an 11% downside to a 3.0% yield and the historically repetitive area of Undervalue.

"Will the Average make it down to that level? No one knows but that isn't the point. At current levels the upside is FAR greater, particularly in many of the stocks in our Undervalued area.

On Monday July 28, Kraft (NYSE: KFT) will be reporting its earnings results for the second quarter. Kraft is a well-known manufacturer of supermarket foodstuffs. We all know the brands: Oreo cookies, Nabisco, Oscar Meyer and many, many others.

It should be a defensive stock, just like Campbell Soup (NYSE: CPB) or PepsiCo (NYSE: PEP), right? Well, it is and it isn't. It's defensive in the sense that, as the cliche goes, people still want to eat their favorite foods even during recessionary times. It isn't in the sense that the stock is down by 16% (as of this writing) in the one-year time period. It does have a nice dividend yield, however, and Warren Buffet seems to like it.

What should investors be looking for on Monday? Well, they should definitely be looking at the margins. Is Kraft navigating this inflationary period in as efficient a manner as possible? I think Kraft will do OK in this regard. I'm not expecting any sort of wide expansion of gross margin, but I think management will report stability in this area.

Hershey (NYSE: HSY) , which recently reported numbers for its own quarter (see Brent Archer's idea for a trade involving Hershey options), did well in keeping margin-erosion at bay. Hershey also beat estimates by a penny. Considering that Kraft beat analyst estimates last quarter, that it has a good history of going beyond expectations and that Hershey was able to beat, then I would have to say that Kraft should have no problem beating on Monday. Hershey has had its share of troubles lately, keep in mind.