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Jeff Matthews Is Not Making This Up

The World of Wall Street in all its glory, and anything else that strikes our fancy. Informed observations about companies or institutions that might be making things up are welcome and encouraged. Have something to share privately? Email us at notmakingthisup@gmail.com.

Headline of the Day: “We’re Firing 5,000 Workers So We Can Make a Stupid Acquisition”January 6

Tuesday, January 6, 2008: Dow Chemical admitted today that roughly 5,000 workers are being laid off in order to help pay the cost of acquiring Rohm & Haas at a price that makes no economic sense…


Actually, we made that up. Dow Chemical admits no such thing.

The company, which in July agreed to buy specialty chemical maker Rohm & Haas at a pre-Credit Crisis valuation of $15.4 billion—more than Dow’s current $14 billion market value—recently received a shock when Kuwait exercised economic prudence by backing out of a $9 billion joint venture that no longer made sense, thus depriving Dow of money to pay for Rohm & Haas.

So today, Dow released a whopper of a rationalization for not excercising its own economic prudence, in the form of a press release that begins as follows:

The Dow Chemical Company (NYSE:DOW) today announced a wide range of legal, operational and financial actions that will keep the Company on track to fulfill the transformational corporate strategy Dow has pursued since 2005.

Dow's strategy will continue to involve aggressive steps to establish Dow as a high-performance, earnings growth company organized around a strong portfolio of joint ventures and market-facing performance business divisions. Central to Dow's strategy is its commitment to retain a strong investment grade rating and to maximize shareholder return.

If that last sentence is suppposed to bear

The Peerless Prognosticator of Palm BeachDecember 30 2008

We have been asked in recent days why we don't join the chorus of investment advisors, CNBC pundits and just plain wise guys offering stock market/investment predictions for the New Year.

Our standard response has been similar to what James Thurber wrote in his introduction to “My Life and Hard Times” (look it up, kids), to the effect that he always carried the uneasy feeling that whatever he was writing had already been done better and more quickly by Robert Benchley (look him up, too).

Robert Benchley was a famous humorist, sort of the Will Farrell of his day—only literate and actually funny. And, in our book, the Robert Benchley of stock market prognostications has to be my old pal, Doug Kass, the so-called “Bear of Boca.”

Doug, who runs money, writes on the stock market and somehow managed to find time to appear on CNBC in years past whenever the hosts needed to find a lonely bear on housing, also publishes a list of predictions every year.

So with Kass on the case, who needs another batch from us?

Sure enough, Sunday night it hit our email: Doug’s fearless predictions for 2009. So fearless, in fact, that the number of predictions runs to twenty in all.

And these are not your Bryon Wien-variety, “The dollar will strengthen and then weaken”-type stuff.

Wien, who pioneered the annual Wall Street prediction phenomenon, tends towards the kind of o

Shazam! From the Boss to the King to John & Paul (But Not George or Ringo), Not to Mention Jessica & NickDecember 24 2008

Like everyone else out there, we’ve been hearing Christmas songs since the day our local radio station switched to holiday music sometime around, oh, July 4th, it feels like.

And while it may just be a symptom of our own aging, the 24/7 holiday music programming appears to have stretched the song quality pool from what once seemed Olympic pool-deep to, nowadays, more of the ankle-deep, wading pool variety.

What we recall in our youth to be a handful of mostly good, listenable songs—Nat King Cole’s incomparable cover of “The Christmas Song” (written by an insufferable bore: more on that later), Bing’s mellow, smoky, “White Christmas,” and even Brenda Lee’s country-ish “Rockin’ Around the Christmas Tree” (recorded when she was 13: try to get your mind around that)—played over and over a few days a year, has evolved into a thousand mediocre-at-best covers played non-stop for months on end.

Anybody else out there wonder why Elvis bothered mumbling his way through “Here Comes Santa Claus”? It actually sounds like Elvis doing a parody of Elvis—as if he can’t wait to get the thing over with.

And, fortunately, get it over with he does, in just 1 minute, 54 seconds.

Along with that and other mediocre-at-best covers, of course, there are the occasional odd original Christmas songs—the oddest of all surely being Dan Fogelburg’s “Same Old Lang Syne.” You’ve heard it: the singer

The Most Important Article You Maybe Didn’t Read this WeekendDecember 22 2008

Being wrapped up in year-end matters, not to mention a review of holiday songs that will appear in these virtual pages whenever we get around to it, we here at NotMakingThisUp can do no better than point potential readers to what may well be the most important article you might not have read this weekend.

The article is by ace NY Times columnist Joe Nocera, and the headline explains it all:

How India Avoided a Crisis.

The URL is as follows:

http://www.nytimes.com/2008/12/20/business/20nocera.html?_r=1&scp=4&sq=Nocera&st=cse

Here’s how Nocera frames the central question of his piece:

… two years ago, the Indian real estate market — commercial and residential alike — was every bit as frothy as the American market. High-rises were being slapped up on spec. Housing developments were sprouting up everywhere. And there was plenty of money flowing into India, mainly from private equity and hedge funds, to fuel the commercial real estate bubble in particular. Goldman Sachs, Carlyle, Blackstone, Citibank — they were all here, throwing money at developers.

So why did the Indian banks stay on the sidelines and avoid most of the pain that has been suffered by the big American banks?

For the answer, read the column.


Jeff Matthews
I Am Not Making This Up

© 20

Steve Jobs: 42% vs. 4%December 18 2008

The oddest news of the week—Bernie Madoff-related news aside—has to be Apple’s explanation of Steve Jobs’ absence from the upcoming MacWorld, in today’s Wall Street Journal:

The company said it was scaling back on trade shows because they have become a “very minor part of how Apple reaches its customers.”

MacWorld is not just a “trade show.” It is a seriously big deal. It’s like Woodstock for Apple users. Just two short years ago Jobs announced the iPhone at MacWorld, setting off a 50-point run in Apple’s stock before the thing even hit the market.

So Jobs not going is no mere casual one-off: it’s like Obama suddenly announcing he has no plans to attend the upcoming inauguration, because, after all, what does it have to do with running the country?

Wall Street, of course, turns to worst-case explanations, including the never-ending speculation over Jobs’ health.

This is no small issue: big as Apple is, it is one of only two companies we can think of that appears to rely on the unique talents of one human being to do what they do especially well. (Berkshire Hathaway is the other.)

Jobs, as everyone knows, had pancreatic cancer. Pancreatic cancer, as everyone knows, is about the worst cancer going. Five year survival rates of the most common (involving so-called exocrine pancreas cases) are 4 in 100.

Fortunately, Jobs had a rare, relatively good form o