Apple Juice Despite Credit Squeeze

With characteristic aplomb, Steve Jobs on Tuesday told us everything will be "fine". For the first time in eight years, BusinessWeek points out, the Apple CEO joined an analyst conference call to reassure the doomsday mongers. "We may get buffeted by the waves a bit, but we'll be fine," he was quoted as saying. The remarks followed Apple's better-than-expected fiscal fourth quarter results, in which Apple revealed its iPhone outsold BlackBerry maker R.I.M. unit-for-unit to earn for the company a net profit of $1.14 billion, or $1.26 a share, the New York Times writes. Demand for Apple's premium products, the Wall Street Journal reports, "has so far been largely unaffected by the souring economy." Jobs & Co., however, provided analysts with an unenthusiastic outlook. Still, after-market shares jumped more than 10 bucks in after-hours trading, the WSJ adds, noting that Apple often gives an overly cautious guidance.

If things only looked so rosy for Yahoo. The former dot-com darling revealed, as expected, a bare-bones restructuring plan that involves roughly 1,500 job cuts, or 10 percent of its workforce, the NYT writes. Net income plunged 64 percent in the most recent quarter, the company reported on Tuesday, a casualty of reduced marketing budgets for online advertising. Yahoo evidently has few places to turn.  A sweeping advertising partnership with Google and merger talks with Time Warner's AOL unit are off the table for the moment, "leaving the company with few options but to cut expenses," the NYT writes, citing analysts. Elsewhere on the tech beat, the NYT reports Samsung Electronics walked away on Wednesday morning from its $5.9 billion takeover bid for the flash memory card maker SanDisk, blaming the ongoing financial crisis.

Major distress signals are coming from Latin America this morning. A series of bad currency and commodity bets -- specifically, the dollar's resurgence and oil's plunge -- are claiming some big scalps in the region, the WSJ reports. "Throughout Latin America, companies are telling investors they have lost millions, in some cases billions, of dollars due to foreign-exchange gambles that, in some cases, had little to do with their core businesses," the newspaper writes, citing the example of the abrupt bankruptcy of Mexican retail chain "La Comer" and the heavy losses by Brazil's paper-pulp giant Aracruz Celulose SA. "Some local reports have speculated that the damage in Brazil alone could exceed $30 billion and may affect two hundred companies," the WSJ adds. Things are getting so serious in Argentina that the government has cracked open "the piggybank of the nation's private pension system" to meet debt payments and "avoid a second default this decade," according to the WSJ.

Back in the U.S., the Federal Reserve on Tuesday injected another $540 billion into still wobbly money-market mutual funds, the NYT reports. It's the third such confidence-raising gesture targeted at the money markets this month. There's a lot riding on salvaging these funds. "As go these assets, so go money-market funds and so goes the economy," Peter G. Crane, president of Crane Data, which tracks money-market funds, told the NYT. In Europe, meanwhile, heads of state appear as divided as ever on finding a silver bullet. On Tuesday, French President Nicolas Sarkozy suggested Europe set up its own sovereign wealth funds to buy stakes in crucial, but ailing, industries "to shield them from potential foreign raiders," the International Herald Tribune writes. The response from his EU allies? It went over like a dud, the WSJ says.

A bit of history now. Back in the early 1980s, the sky-high price of crude oil plummeted, leaving OPEC nations (who'd ratcheted up the price in a series of "oil shocks") looking rather silly and wondering how to maintain their monoculture economies. Fast forward to today and the NYT reports how "the speed of the decline [in the price of crude] has stunned oil-rich governments that have become dependent on high prices." Admittedly, the size of the fall from $146 to $70 is pretty spectacular, but not completely surprising. After all, the 1980s OPEC woes were a direct result of overproduction and falling demand. Now the question is what price will OPEC be prepared to defend through cutting production and enraging Western governments looking for cheap fuel to reduce inflation and reignite growth? The NYT suggests somewhere between $70 and $80 a barrel. Of course, co-ordinating a cartel-wide production cut won't be easy. "When prices fall producers have an incentive to increase their output to maximize revenue, not stick with OPEC quotas," the NYT notes.  Sticking with market manipulation, Russia, Iran and Qatar, who together control 60% of the globe's confirmed natural gas reserves, plan to form an Opec-style gas cartel. "Alexey Miller, chairman of Russia's Gazprom, said they were forming a 'big gas troika' and warned that the era of cheap hydrocarbons had come to an end," reports the Guardian.

Call it the billionaire's bailout. Of faltering stocks, that is. Kirk Kerkorian is leading the charge, dumping 7.3 million Ford shares on the open market at an average price of $2.43 -- "well below the average of about $7 a share he paid for most of his holding," the WSJ notes. Kerkorian's move is bad news for anyone looking for a light in the auto industry's very dark tunnel to prosperity and is part of a greater credit crisis trend that sees "an unprecedented number of executives being forced to sell off their holdings at steep discounts," writes Business Week. "So far in October, almost $1.24 billion in stock has been sold by CEOs and other executives to cover debts," it writes. Even savvy folk like Bill Gates are taking a bath it seems. The FT reports that Microsoft's co-founder is just one of many investors who are "sitting on billions of dollars in losses after buying into the [now crashing] corn-based ethanol industry."

Finally, China may be facing its biggest slowdown this decade, but that's not stopping Wal-Mart from trying to enforce a series of environmental, labor and safety standards on its Chinese producers, the WSJ writes. One already hurting apparel manufacturer didn't take the tough new mandates so well. His question: "who's paying? "Us or them?"Wal-Mart CEO Lee Scott admits: "I don't expect people to immediately jump off their chairs and say this is wonderful. There will be a healthy dose of skepticism on some people's part."