Business News You Need Today: Aug. 9, 2010
Hurd's Leadership Questioned: Many questions remain unanswered about Friday's sudden departure of Hewlett-Packard (HPQ) chief executive Mark Hurd. Hurd resigned after the company accused him of falsifying expense reports to conceal a relationship with an HP contractor, who had alleged Hurd sexually harassed her. Beyond prurient inquiries, Hurd's actions leave many to wonder just how effective a leader he was. Though the company's stock price -- at about $42 -- has nearly doubled since Hurd's arrival in 2005, as DailyFinance's Peter Cohan explains, HP's financial statements don't back up that gain.
Chrysler Reports Smaller Loss: Chrysler Group reported Monday it lost $172 million in the second quarter, smaller than the $197 million net loss the automaker reported in the first quarter. Second-quarter revenues rose 8.2% to $10.5 billion compared to $9.7 billion during the first three months of the year. Chrysler said it sold 407,000 vehicles worldwide during the three months ending June, an increase of 22% above the previous quarter.
Fed Weighs Monetary Easing: Monday is expected to be a rather quiet day on Wall Street, as investors await the latest statements by the Federal Open Market Committee, which meets Tuesday. With the economic rebound seemingly in jeopardy, August's normally sleepy one-day meeting may be more productive than usual. There is speculation that the policy-making body of the Federal Reserve will again resort to some quantitative easing -- a way of pumping additional money into the financial system.
Oil Prices Pump Up: Oil prices are back in the news. After a big drop Friday, in reaction to July's disappointing U.S. jobs report, crude prices edged back up above $81 in Asian trading Monday. Investors are betting that Americans' demand for fuel will remain subdued as consumers keep a tight rein on personal spending.
Greenspan: Repeal Tax Cuts: Former Federal Reserve chairman -- and self-described lifelong Republican -- Alan Greenspan wants Bush-era tax cuts passed in 2001 and 2003 that benefit wealthy Americans to be repealed. As reported by The New York Times, Greenspan favors lower taxes, "but not with borrowed money," he said.
Relief Well Work Continues: BP (BP) continues work on a relief well to complete the second part of a two-part procedure to permanently seal the broken Macondo well in the Gulf of Mexico. The oil giant said last week it expected to begin the so-called "bottom kill" Sunday evening but it wasn't yet clear whether the company had begun the process. Separately, the company said Monday its costs related to the massive oil spill have risen to about $6.1 billion. The amount includes expenses for the relief well, sealing the broken well, as well as grants to Gulf coast states and people affected by the spill.
Tainted Beef Recalled: A California meat process is recalling 1 million pounds of ground beef that may have been contaminated with E.coli bacteria. Modesto-based Valley Meat Co. said the products, which include "Bigger Valley Burger" and "Ground Beef Chuck Patties," were sold in California, Texas, Oregon, Arizona and internationally. The mainly frozen products were produced between Oct. 2 and Jan. 12.
Malibu 'Party' House Sold: A foreclosed beach house where a Wells Fargo (WFC) executive once threw lavish parties has been sold for nearly $15 million, according to the local Multiple Listing Service. The four-bedroom, four-bath home, situated in the famed Malibu Colony, was originally listed for $21 million. As Luxist's Ann Brenoff reports, the 3,800-square-foot home, once owned by victims of the Bernie Madoff ponzi scheme, was the center of attention last year after a bank vice president moved herself into the house.