A Japanese TV reporter ordered a Burger King burger with 1050 strips of bacon on it (and apparently ate about half of it). Seven and a half is a more manageable number, and it's the number of things you need to know each day. Here they are:
Thing One: Big Box Of Trouble: Lots of Americans have gotten themselves in trouble with misadventures in Mexico. A blockbuster New York Times report claims Wal-Mart found trouble in an appropriately big way.
The NYT reported on Sunday that Wal-Mart executives buried an internal investigation finding "widespread bribery" at Wal Mart de Mexico, a/k/a Walmex, the company's biggest foreign subsidiary. According to the report, the bribery facilitated Wal-Mart's virulent spread in Mexico -- there are more than 2000 Wal-Mart stores in the country, Wal-Mart is Mexico's biggest private employer with more than 200,000 employees, and one in every five Wal-Mart stores in the world is in Mexico. So this is kind of a big deal for Wal-Mart, I guess is what I'm saying.
Wal-Mart has said it is "deeply concerned" about the report and is looking into it. Meanwhile, this morning we're opening an umbrella waiting for the inevitable fallout, which the Wall Street Journal says will involve "significant legal risks," possibly including criminal charges for people at the company. Reuters warns Wal-Mart faces "years of regulatory scrutiny," with some executives walking the plank. The near term will almost certainly involve some pain for the stock prices of Wal-Mart and Walmex, with short-sellers already sharpening their knives, Reuters points out.
Thing Deux: Zut Alors, Sarkozy: Also in a bit of hot water this morning is French President Nicolas Sarkozy, who fell short of his Socialist opponent, Francois Hollande, in a first-round election on Sunday. Polls show that Hollande will probably beat Sarkozy in a run-off election on May 6, but Sarkozy could take some comfort in a stronger-than-expected showing from far-right candidate Marine Le Pen; maybe some of those voters will jump to Sarkozy's side in May. The ultimate outcome could have an impact on the European debt crisis: Sarkozy has mostly gone along with the austerity worship of his German counterpart Angela Merkel, while Hollande favors stimulating growth. Some in the bond market say that a Hollande presidency would be disastrous, but it's also very possible that investors recognize France and other European countries need growth more than austerity right now.
Thing Three: Fed Watch! Back at home, the Federal Reserve is gearing up for a two-day policy meeting on Tuesday and Wednesday this week. Fed watchers don't expect much new out of the Fed, writes the Wall Street Journal's top Fed watcher Jon Hilsenrath, which could come as a disappointment to financial markets hooked on stimulus. Fed Chairman Ben Bernanke will hold a press conference on Wednesday, one feature of the Fed's efforts to be more transparent, which appear to have sown more confusion than clarity, writes Binyamin Appelbaum of The New York Times.
Thing Four: Data Downer: The Fed may stand pat because U.S. data, while a little weaker than expected recently, haven't been awful -- or at least not as bad as numbers from the rest of the world. This morning we got new data from China and Europe showing factory output shrank in those massive economic engines in April, pushing global stock market futures lower, writes Bloomberg.
Thing Five: The Economic Trend Is Obama's Friend: President Obama, meanwhile, must be feeling somewhat OK about the economy this morning, with two stories about how economic trends are favoring his re-election in the fall. The LA Times points out that Europe has gotten more aggressive about wrestling its debt-crisis demon, which can only help Obama. Meanwhile, oil prices have come off the boil, and economists are still sanguine about job growth the rest of the year, despite some shaky data lately. And the Associated Press over the weekend pointed out that job growth was improving in some of the swing states Obama will need in his column in the fall: "A resurgence in manufacturing is helping the economy — and Obama's chances — in the industrial Midwestern states of Ohio and Michigan. And Arizona, Nevada and Florida, where unemployment remains high, are getting some relief from an uptick in tourism."
Thing Six: Where's Our Money? A group of MF Global clients plans to send a letter today to regulators and lawmakers demanding they put more pressure on JPMorgan Chase to return client money that went missing upon MF Global's collapse, writes Aaron Lucchetti of the Wall Street Journal. JPMorgan says it's cooperating, it's doin' all it can here.
Thing Seven: Another Regulatory Cave: Here comes yet another cave by U.S. regulators. The Commodity Futures Trading Commission is considering giving foreign banks and foreign subsidiaries of U.S. banks an exemption from regulation of their swaps business, the Financial Times writes. These derivatives were at the heart of the financial crisis, and regulators have already retreated once from new regulations in this area.
Thing Seven And One Half: Real-Live Hangover: If there's going to be a Hangover 3, God help us all, then maybe the producers could save some money and just follow around the three British guys who recently got drunk, broke into an Australian Sea World, swam with dolphins, stole a penguin and then woke up the next morning with a rare sea bird waddling around their apartment and no clue about how it had gotten there. Newt Gingrich could not be reached for comment about the further deteriorating state of human-penguin relations, but the penguin is back safe at home.
Calendar Du Jour:
None to speak of.
Heard On The Tweets:
@ReformedBroker: On the bright side, Sarkozy now freed up to play ambiguously European gem thief in forthcoming 'Ocean's 14'
@moorehn: Tatler slang : "Banker's dozen, n. A ripoff. The opposite of a baker's dozen, i.e. when you receive 11 for the price of 12."
@DKThomp: Worst thing abt the accidental 13,000-person firing email will be the follow-up: "Dear all, you're not all fired. Except for you, Dave."
-- Calendar and tweets rounded up by Khadeeja Safdar.
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