Madoff’s Secret: Keep Mum When Asked About Methods

Bernard Madoff conned even the most sophisticated of clients, such as Fairfield Greenwich Group, through a simple tactic whenever he was asked probing questions: He refused to answer or he lied..

Source: Bloomberg  News

Date: 4/03/2009

Keys: Investing, government, regulation, ethics, law

Link: http://www.bloomberg.com/apps/news?pid=20601170&refer=special_report&sid=asYX4sfz1XhY

Questions for discussion:

• What lessons did you learn about risk and investing from this article?
• What roles should government regulatory bodies such as the SEC, play in these situations?
• Who is to blame for the losses incurred by investors?
• What threat of punishment would deter others from conducting such a fraud in the future?
• Is this a worse case of fraud because of the massive size of the funds lost?

YouTube Partners with Universal Music

YouTube has partnered with Universal Music Group (UMG) to launch a new music video service called Vevo. Under their agreement, YouTube will provide the infrastructure for a new site at Vevo.com, to be populated with video from artists on UMG-owned labels such as Decca, Def Jam, Mercury Records, and Verve. YouTube will also host those videos on its own site, where they’ll be housed in a Vevo channel via an embedded player. The companies will share revenue for ads served on both Vevo and YouTube.

Source: Clickz.com

Date: 4/10/2009

Keys: Marketing, distribution channels, strategic alliances, technology

Link: http://www.clickz.com/3633376

Questions for discussion:

• Do you believe this strategy will become more common in the industry?Explain your answer.
• Which factors make this arrangement good for Googles’ YouTube, their partners, and customers?

Research In Motion 4Q Rev, Net Beat Expectations

Research In Motion Ltd.’s (RIMM) shares jumped almost 22% in after-hours trading after the company offered better-than-expected first-quarter earnings and margin guidance.

Source: WSJ

Date: 4/02/2009

Keys: Marketing, technology, finance, stock market

Link: http://online.wsj.com/article/BT-CO-20090402-718397.html

Questions for discussion:

• Although the industry leader in the corporate market, RIM faces stiff competition from competitors such as Apple’s iPhone as it fights for consumer market share. Why do you think Blackberry’s have sold so well to consumers?
• What do you think distinguishes one brand from another in the consumer’s mind?
• How important do you think price is to consumers?
• Which features would you add to future models?

On the Rebound: Dow Closes Near 8,000

Markets around the globe — in London, Paris, Frankfurt and New York — all staged powerful rallies Thursday on hopeful signs that the world’s biggest economies are committed to working together to end the global recession. At the G-20 summit in London Thursday, world leaders agreed to infuse $1.1 trillion in loans and guarantees to help developing countries, as well as to enforce regulations on financial institutions — all in the name of global economic recovery.

Source: ABCNews

Date: 4/02/2009

Keys: stock market, economics, governments

Link: http://www.abcnews.go.com/Business/story?id=7241896&page=1

Questions for discussion:

• Since stock markets are considered a leading indicator or predictor of future economic activity, why do you think that stock market investors are now more optimistic about an improving global business environment?
• Which businesses do you think will show the greatest improvement as the global economy begins to recover?
• Explain your reasoning.

Buzz rises for Facebook IPO

Facebook is gearing up to befriend investors. That, at least, is the chatter around Silicon Valley after the social networking darling booted its chief financial officer. But an IPO would be risky given Facebook’s business model is still unproven – unless it has a gun to its head.

Source: WSJ

Date: 4/02/2009

Keys: finance, management, investment, stock market, marketing

Link: http://money.cnn.com/2009/04/02/technology/facebook_ipo.breakingviews/index.htm?postversion=2009040214

Questions for discussion:

• What reasons might explain Facebook’s current owners’ motivation to become a public company?
• What similarities are there between Facebook today and Google just before it went public?
• How can you explain the valuation stated for Facebook ownership, given its current financial condition?
• Do you think Facebook would be as good a stock performer as Google has been since it went public?
• Explain your thinking in terms of profits, market share, advertising revenues etc.

Where Wagoner went wrong

Fortune’s Alex Taylor III says GM’s former CEO didn’t execute needed drastic changes.

Source: CNN – video report

Date: 3/31/2009

Keys: Management , leadership, decision-making, organizational re-structuring, government

Link:  http://money.cnn.com/video/news/2009/03/31/fortune.sl.taylor.gm.033109.fortune/index.html

Questions for discussion:

• Do you agree with the Taylor’s analysis and explanation of GM’s failure?
• Would you have kept Rick Wagoner as head decision-maker?
• Does GM need a financial leader or a marketing leader more?
• What would you do to rejuvenate GM?

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