Today's Business Press

Shady hedge fund honchos, beware. That's the message the business press declares this morning in its coverage of new charges brought down yesterday against 14 money managers, Wall Street lawyers, and other well-connected investors with ties to the Galleon insider-trading probe. The Wall Street Journal describes their alleged criminal dealings as something out of a James Bond movie, "including packages of money, throwaway cellphones, a ringmaster nicknamed 'Octopussy' and an associate called 'the Greek.' " The New York Times adds the racket "was pierced in part through surveillance and wiretaps." The subterfuge enabled the band of conspirators to net a cool $20 million in profits from dodgy "inside" trades, prosecutors say.

The case came to light last month after federal authorities charged hedge fund tycoon Raj Rajaratnam, founder of Galleon Group, and five others with masterminding a vast insider trading racket. And, the NYT reports, more arrests are expected in the coming weeks as a special FBI unit expands its broader probe into the more murky dealings of hedge funds. Where might the wire take investigators next? "For the first time, the authorities hinted that they might be brushing against the pinnacle of the hedge fund world, S.A.C. Capital Management, a $12 billion Connecticut fund company," the NYT writes, adding, "neither S.A.C. nor any current employee has been charged with wrongdoing."

Elsewhere on Wall Street Thursday, there was reason to celebrate. The Dow once again topped the 10,000 mark after its biggest one-day rise since July. "Today's big news was that we saw fewer claims for unemployment benefits," said Mike Stanfield, chief investment officer at VSR Financial Services, told CNNMoney.com. "That suggests that the underlying economics are continuing to improve." Ah, but of course we've been here before. The Dow has been wildly gyrating above and below 10,000 for much of the month. But there is some cause for sustained hope this time. According to the WSJ, the Labor Department reported on Thursday that U.S. worker productivity improved at its most vigorous rate since the Kennedy administration "even as employers pushed forward with layoffs and cuts in working hours across a wide range of industries."

Ever since the government threw billions of dollars at the financial system last year, pols and analysts have been trying to work out where exactly the money went, who really benefited and whether the policy worked. Well, according to the NYT, one side effect was to allow "a handful of giant institutions to save up to $25 billion on their borrowing costs," including General Electric Capital ($1.9 billion in savings) and Goldman Sachs (GS) ($606 million) as well as smaller sums for Citigroup (C), Bank of America (BAC), and Morgan Stanley (MS). The savings were part of the $4.3 trillion safety net and came in the form of "federal guarantees on more than $300 billion of bonds issued by banks and other financial institutions." But before we get too outraged, it turns out the government has turned a profit on this risky business, collecting $9 billion in fees for guaranteeing the bonds.

To the world of Big Oil now and news that, six years after the overthrow of Saddam Hussein, Iraq has agreed a series of new foreign consortium deals to reinvigorate its sleeping giant of an oil industry. On the heels of a big deal earlier in the week with BP (BP) and China National Petroleum Company, Iraq's Oil Ministry has granted the first  drilling concession to a U.S. company in the form of consortium deal led by Exxon Mobil to develop the West Qurna-1 oil field (holding an estimated 8.7 billion barrels of reserves) in the south of the country. Exxon, working with Royal Dutch Shell, offered the highest bid and beat out rival consortiums led by OAO Lukoil, ConocoPhillips (COP), and CNPC.

And finally, how is it that employees of Wall Street's most powerful firms were first on the list to get the precious rations of the swine-flu vaccine? According to the WSJ, "Goldman Sachs Group Inc., Morgan Stanley and Citigroup Inc. are among several large New York City employers that got doses of the H1N1 vaccine," prompting an uproar over how the doses should be distributed to the public. As a result, the Centers for Disease Control and Prevention is warning regional health officials around the country now to distribute the doses to high-risk groups first. And, no, "high-risk" does not necessarily mean bailed-out financial firms.

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Evidently, Warren Buffett is a betting man. And a big one at that. The Wall Street Journal and the New York Times strike nearly identical headlines this morning in describing Buffett's surprising $26.3 billion acquisition of Burlington Northern Santa Fe Corp, both declaring "Buffett bets big" on, of all things, freight trains. The NYT notes the investment seems more 19^th century than 21^st century, but this is not just the move of a wealthy old man who likes to play with trains. "Mr. Buffett is wagering that as the economy revives, so will the demand for goods to be shipped by train. Burlington Northern carries coal and timber from the West, grain from the Midwest and imports arriving directly from Mexico and Canada, as well as through California ports," the newspaper writes. The move, the WSJ notes, completely transforms Berkshire Hathaway "into a megaoperator of industrial firms, moving the Omaha, Neb., conglomerate further from its roots as a nimble investment outfit." The thinking is that high fuel costs are here to stay and therefore freight trains will be a more efficient way to move goods around the country than trucks.

The world demand for oil, however, has never been so uncertain. According to the WSJ, the world may be on the cusp of shaking off a global recession, but that's not having the expected lift for oil demand. The newspaper writes, citing sources, that "the International Energy Agency next week will make a 'substantial' downward revision to its long-term forecast for global oil demand ... marking the second year running the group has slashed its view of the world's thirst for oil."

General Motors stunned the automotive world yesterday with news that, no, it will not be selling its European division, Opel. "The decision was a blow to the Canadian auto supplier Magna, which was poised to acquire a 55 percent stake in Opel with the backing of the German government and labor unions," the NYT writes. Instead, the new GM board decided it would keep Opel and pour billions into restructuring the unit, which includes British automaker Vauxhall. "GM's change of heart reflects the car maker's increasing confidence about its outlook as well as the direction of its aggressive new chairman, Edward E. Whitacre Jr. The former AT&T Corp. chief, who was picked by the U.S. government for his post, has told GM executives to concentrate on expanding its market, not shrinking it," the WSJ writes. Don't feel so bad for Magna though. In a separate article, the WSJ reports that "being dumped by GM is a blessing." Turning around Opel would be costly and time-consuming for Magna, the newspaper notes. Across town, Chrysler's new turnaround maestro, Sergio Marchionne, the CEO of Fiat, will unveil his plan to restore Chrysler's business later today. How can Marchionne save Chrysler, which has seen U.S. auto sales drop by 40 percent in the past year? With Fiats, writes Business Week. "Marchionne will lay out his plan, which, according to industry insiders, involves plugging Chrysler's product holes with Fiat-engineered cars."

Retail bounced back in October as sales figures show "robust sales growth for the first time in more than a year," the NYT writes. Sales for women's apparel have increased for the first time since August 2008 and across-sector sales in California also appear to be stabilizing. Overall, Thomson Reuters, "which aggregates analysts' estimates for 30 companies, predicts a 2% increase," writes the WSJ. Of course this good news is only relative to how bad things had become during the last 12 months but still, as the NYT writes: "Contrary to predictions made only a few weeks ago, the nation’s stores could be poised for a merrier Christmas this year than last."

China is on a tear with its economy now expected to grow 8.4 percent this year, according to the World Bank’s latest projection, the NYT writes. The Bank raised its forecast for growth in China, "though it cautioned that more policy adjustments would be necessary in the medium term to ensure the country’s recovery would be sustained." But the World Bank also worries that a new Asian economic bubble might be on the rise, notes the WSJ. The sudden injection of billions of dollars in investment capital in the region is "raising concerns about asset price bubbles" in Asian equity markets and in China's, Hong Kong's, Singapore's, and Vietnam's real estate markets, the bank said.

And finally, consider the rotten job the poor human resources manager has these days. Whenever they post a "help wanted" ad, they get inundated with résumés and cover letters, most of them unqualified. CNNMoney.com reports that there are quality job positions that continue to go unfilled despite the highest unemployment rate in generations. The reason? Not enough qualified candidates. CNNMoney.com cites a recent survey by Human Capital Institute and TheLadders. It concluded: "[M]ore than half of employers said 'quality of candidates' or 'availability of candidates' are their greatest challenges—despite the recession."

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