Commodity hedge fund loses $400m in oil slide (FT)
Clive Capital, the world’s largest commodity hedge fund, has been left nursing losses of more than $400m as a result of the collapse in the price of oil last week…Others, including Astenbeck Capital, the Phibro-owned fund run by Andrew Hall, are thought to have taken double-digit percentage point losses to their portfolios, according to investors…In a letter sent to investors on Friday and seen by the Financial Times, Clive said it was down 8.9 per cent on the week after what it called “extraordinary” price movements on Thursday. Clive’s management said it was at a loss to explain what had caused crude oil markets to be “annihilated”.

Silver-Mad Small Investors Fueled an Epic Rise and Fall (WSJ)
Behind silver’s historic collapse is a market that came loose of its moorings, fueled by speculative traders, many of them small investors who may have jumped in at just the wrong moment. “If gold is a Monte Carlo casino, silver is a slot machine in Las Vegas,” says Andy Smith, a senior metals strategist at Bache Commodities.

Euro Nations Divided Over Greek Debt (WSJ)
Finance chiefs from the most important euro nations discussed Greece’s problems—and other issues, including Portugal’s imminent aid package—at informal talks in Luxembourg on Friday. The gathering, one of many informal meetings of select European officials since the financial crisis began, turned into a media circus after Germany’s Spiegel Online reported its existence Friday—and claimed it had been called because Greece was thinking of leaving the euro zone. The report sent the euro tumbling…”We are not discussing the exit of Greece from the euro area. This is a stupid idea and an avenue we would never take,” said the host of Friday’s meeting, Luxembourg Premier Jean-Claude Juncker.

EU eyes lower rates for Greece, Ireland amid chaos (Reuters)
The European Union is looking to lower interest rates on bailout loans to Greece and Ireland and is working on a second rescue for Athens in a chaotic effort to prevent a disorderly debt restructuring. The executive European Commission said on Monday it hoped to see a decision within weeks on reducing the rate charged to Ireland to make Dublin’s debt more sustainable.

Irish to Avoid ‘Doomsday,’ Honohan Says as Rescheduling Mooted (Bloomberg)
Irish central bank Governor Patrick Honohan said the country will avoid economic “doomsday,” as a government minister and prominent professor suggested the nation should reschedule debts from its as much as 85 billion-euro ($121 billion) bailout. Honohan was responding to Morgan Kelly, an economics professor dubbed Ireland’s Doctor Doom, who wrote in the Irish Times newspaper that Ireland faces a “prolonged and chaotic national bankruptcy.”

U.S. Will Urge China to Boost Interest Rates in Washington Talks (Bloomberg)
Treasury Secretary Timothy F. Geithner will urge China to allow higher interest rates when he meets with Chinese leaders this week, as the U.S. extends its push for a stronger yuan.

Private Equity Has A Horse In This Race (Dealbook)
Carl Pascarella, an executive at TPG, the private equity firm, owns a piece of the the colt that shocked the horse racing world on Saturday with a come-from-behind victory. Animal Kingdom, who had never run on dirt and only had four races under his belt, covered the mile and a quarter in 2:02.04.

AIG Fall Blunts Talk Of Taxpayer Gain (WSJ)
What Treasury chooses to do with its AIG shares “is essentially a political decision,” says Jay Ritter, a finance professor at the University of Florida. “Government officials and politicians would like to say we broke even and didn’t lose any taxpayer money” in the AIG bailout, he says. “But as a taxpayer, I would be happy if we got out close to whole, and losing a little would ultimately be a good outcome” given the amount that was committed to the AIG bailout, Mr. Ritter says.

Fee Pitched for Fast Firms (WSJ)
Sen. Charles Schumer told regulators that sophisticated electronic traders should bear the cost of monitoring their dealings, with special fees assessed to firms that issue and then rapidly cancel securities orders.

UBS fears missing ambitious targets (FT)
Oswald Grübel, chief executive, surprised analysts last month by maintaining his medium-term goals of SFr20bn (€16bn) in annual revenues and SFr6bn in pre-tax profits for the group’s recovering investment bank. UBS’s performance targets were set in late 2009, before the new Basel III framework was finalised and before regulators in Switzerland proposed their own additional capital requirements for the group…However, according to senior UBS bankers, there is a growing acceptance that the targets are aspirational and will be extremely difficult to achieve over the next two years.

Moody’s: Expiring of US muni backstops going well (Reuters)
An expected flood of expirations of liquidity facilities on U.S. municipal debt this year is so far going well, Moody’s Investors Service reported on Monday.

SEC reform proposal threatens ‘dark pools’ (FT)
The US Securities and Exchange Commission is considering a proposal to move more trading back on to exchanges from alternative venues such as “dark pools”, which has drawn sharp criticism from banks and many trading firms. David Shillman, associate director of the SEC’s division of trading and markets, told the Financial Times that a so-called “trade at” rule is “very much in play. There’s interest in it”. The “trade at” rule, which would require non-exchange venues to improve on the displayed market price, is a response to concerns among some academics and market participants that a rising share of trading happening outside of exchanges is making trading more expensive and difficult.

US Q1 home values see biggest drop since 2008–Zillow (Reuters)
Zillow said its home value index fell 3 percent in the first three months of the year from the previous quarter, and was down 8.2 percent year-over-year.

Seeking Business, States Loosen Insurance Rules (NYT)
Vermont, and a handful of other states including Utah, South Carolina, Delaware and Hawaii, are aggressively remaking themselves as destinations of choice for the kind of complex private insurance transactions once done almost exclusively offshore. Roughly 30 states have passed some type of law to allow companies to set up special insurance subsidiaries called captives, which can conduct Bermuda-style financial wizardry right in a policyholder’s own backyard.

Berkshire Hathaway profit falls on Japan (Reuters)
Berkshire reported a net profit of $1.51 billion, or $917 per Class A share, compared with a profit of $3.63 billion, or $2,272 per Class A share, a year earlier. The company took a provision of $1.7 billion in the first quarter for catastrophe losses, primarily for the Japan earthquake but also from a quake in New Zealand and flooding in Australia…Berkshire also recorded losses of $506 million in the first quarter for stocks where the company’s investment was in a loss position and that loss was not considered temporary. The biggest share of the loss was an impairment on part of Berkshire’s stake in Wells Fargo, and the rest came from an impairment on the stake in Kraft Foods.

HSBC Costs Rise on New Hires and Customer Compensation (Bloomberg)
Costs as a proportion of income rose to 60.9 percent from 49.6 percent, the London-based bank said today in a statement. Net income rose 58 percent to $4.15 billion compared with $2.63 billion in the year-earlier period, the bank said in its first detailed quarterly earnings report. The shares fell.

U.S. gas prices hit $4 a gallon, but may retreat (Reuters)
The national average for self-serve, regular unleaded gas was $4 per gallon on May 6, up 11.98 cents from April 22, according to the nationwide Lundberg Survey. This was still below the all-time high of $4.11 on July, 11, 2008, and last week’s fall in crude oil prices may lead to a 8- to 12-cent drop in prices at the pump over the next few weeks, according to Trilby Lundberg, the survey’s editor.

Sweep is an ugly ending for Lakers and a bittersweet one for Phil Jackson (LA Times)
The Mavericks’ 122-86 blowout victory in Game 4, which completed their 4-0 sweep of the Western Conference semifinal series, perhaps came at the right time for the Lakers. They appeared to be teetering, perhaps because this was the 77th postseason game they had played since 2008, nearly an extra 82-game regular season in a four-year span. “I was talking to Kobe [after the game] and we both agreed it was better to lose now than to get to the [NBA] Finals and lose,” Jackson said. “Going all the way and losing in the Finals, now that’s really tough.”

What was in medicine chests at bin Laden compound? (MSNBC)
Either Osama bin Laden or those who lived with him at the Pakistan compound where he was killed apparently suffered from stomach ulcers, high blood pressure and nerve pain — plus the normal ailments that affect a family with children, according to a pharmacist’s analysis of medications reportedly found at the site. In addition, the medicine cache was said to contain Avena syrup, a botanical product that has at least two uses: as an artificial sweetener often used for a sour stomach and as “natural Viagra” that could be used to increase sexual desire and potency.

Article courtesy of Dealbreaker

CNet News’s Stephen Shankland is reporting this morning that Amazon.com (AMZN) has had a “partial failure” of its Web Services cloud computing facilities, disrupting online firms such as Quora and Reddit.

The disruption at Amazon’s Virigina data center affected East Coast customers and began a 1:41 am, Pacific, Shankland reports, citing data from the customer dashboard display. Amazon said it was working to fix the problem.

Amazon shares today are down 44 cents at $183.43.

Article courtesy of Tech Trader Daily

Bamboom Labs announced yesterday that it has raised $4.5 million in seed financing for developing technology that allows consumers watch live TV over the Internet. New York-based FirstMark Capital led the round, also participating were High Line Venture Partners, SV Angel, First Round Capital, and Highland Capital Partners.

Bamboom Labs is headed by Chaitanya “Chet” Kanojia who’s last startup Navic Networks was acquired by Microsoft in 2008.

The company’s technologies allow customers to access free over-the-air broadcast signals over the Internet and direct it to connected devices.

The team includes people from Navic and Microsoft as well as RF and digital technology engineers from Andrew Corporation, Lucent and others.

Copyright laws make distributing the TV programming over the Internet quite tricky. There needs to be some creativity from Bamboom’s side. The company cannot just redistribute the TV signal over the internet without facing the wrath of copyright holders. That means Bamboom would need to license content to retransmit it over the net — a costly and complicated process that even Google has had trouble with.

Bamboom’s way around copyright issues at the moment is to rent a personal antenna to the customer. That way the customers, not the company, are responsible for recording and retransmitting. And that should take care of the issue, LA Times reports.

Tags: Internet TV, Seed financing

Companies: Bamboom Labs, First Round Capital, Firstmark Capital, High Line Venture Partners, Highland Capital Partners, SV Angel

People: Chet Kanojia

Article courtesy of VentureBeat » deals

Shares of optical component maker Finisar (FNSR) are down $15.33, or 38%, at $24.71 this morning after the company yesterday forecast the current quarter’s results below expectations, and told analysts it simply had no answer for why business appeared to have suddenly dropped off in China in recent weeks.

In a note to clients this morning, Citigroup analyst Kevin Dennean writes that this was a pause, not a collapse, in the optical market, similar to stumbles that have been seen by component maker Oclaro (OCLR) and equipment maker Ciena (CIEN) in recent months. “We believe overall demand remains healthy.”

However, he reiterates a Hold rating on Finisar, given that he thinks the miss in China is attributable to a cancellation of orders by Chinese equipment vendor Huawei, specifically for 40-gigabit optical components.

Although the sharp drop in Finisar and the resetting of expectations “may present an opportunity,” writes Dennean, “we prefer to further assess trends at Huawei as well as gain a better sense of the competitive dynamic.” He cut his price target on Finisar to $30 from $35.50.

Meantime, Stifel Nicolaus’s Ajit Pai reiterates a Buy recommendation on Finisar shares, while trimming his target price to $39 from $41. While the business can be “volatile” and have “limited visibility,” that’s merely a result of the fact that the customer base for optical is still “diversifying” and sometimes customers order too much out of concern the supply chain is constrained.

Despite all that, “FNSR remains one of the key beneficiaries of rebounding carrier spending to address bandwidth and QoS requirements as well as ramping technology adoption for increasingly agile and higher data rate (40G+) networks.”

The inventory correction will pass in a couple of quarters, writes Pai. He trimmed his estimates for the fiscal year ending April of 2012 to $1.08 billion in revenue and $1.78 in EPS from a prior $1.15 billion and $2.08.

Credit Suisse’s William Stein likewise reiterates an Outperform rating on Finisar shares, while lowering his price target to $29 from $43. The weakness among Finisar’s Chinese equipment customers will be temporary, he believes, and does not contradict Stein’s view that “bandwidth constraints are driving carrier investments in systems that deliver greater bandwidth and more flexible networks that Finisar’s products enable.” In particular, he looks forward to revenue starting this quarter for the company’s tunable “XFP” transceivers.

Article courtesy of Tech Trader Daily

1SaleaDay, a daily deals company that seems to be flying under the tech press’ radar, just announced that it has raised what it calls a “massive capital injection.”

A company spokesperson wouldn’t give me an exact funding amount, but said it was “a high 8-figure number”, i.e., in the tens of millions of dollars.

There are obviously tons of popular daily deals services online, led by group deals site Groupon. 1SaleaDay says that across its five sites (1SaleaDay.com, Shadora.com for jewelry, Ben’s Outlet for electronics, Dynamite Time for watches, and GlassesUnlimited.com for watches) it reaches 1.5 million customers.

Here’s how founder and chief executive Ben Federman described the way his company stacks up against the competition:

As far as all the other deal-a-day sites, there are many. A few small ones, there are very few that are as large as we are. What sets us apart from all the other sites is that we follow the integrity of the day-to-day deal. We make sure that, even when we have an item that we’re able to markup a little bit, we intentionally don’t – we stick to our small margins and move more volume than anything, and make sure the customer is satisfied.

We never say, let’s take an item today, since we have 350,000 people, and mark it up $5 or $10 – we just don’t do that. Everything has to be at the best offered price. So we’re essentially pushing the wholesale cost to the customer with a very small markup, and people love it. Some days, we’re even willing to lose money to attract people.

The funding comes from Optima Ventures, an affiliate of Optima International. Optima and 1SaleaDay are now teaming up to form Octagon Commerce, a parent company that owns all five sites and will launch new social media and e-commerce products. (For more thoughts about social commerce, see my write-up of One Kings Lane CEO Doug Mack’s comments earlier today.)

Tags: daily deals

Companies: 1SaleaDay, Octagon Commerce, Optima International, Optima Ventures

People: Ben Federman

Article courtesy of VentureBeat » deals

Google has announced a payment service for online digital subscriptions that hopes to be more publisher-friendly –and cheaper– than the one unveiled by rival Apple on Tuesday.

Dubbed Google One Pass,  the new service will allow online publishers to hawk their digital content on the Web and through mobile apps using Google’s existing payment service, Google Checkout.

Readers would then be able to access that content on a variety of devices using only their Google e-mail address and password.

The pricing is a direct take-on of Apple’s subscription service on iTunes, under which Apple would keep 30 percent of any sale of digital content, like newspapers and magazines, within an iPhone or iPad app — compared to the 10 percent slice of the sale price Google is offering under its service.

When publishers use One Pass, which for now is limited to online newspapers and magazines, Google will also share the customer’s name, ZIP code and e-mail address, unless a user decides to opt out.

With Google One Pass, publishers can then customize how and when they charge for content while experimenting with different models to see what works best for them. This could mean offering subscriptions, metered access, “freemium” content or even single articles for sale from their websites or mobile apps, said Google.

The service also lets publishers give existing print subscribers free or discounted access to digital content.

Apple’s CEO Steve Jobs had earlier said of its new service that it was more interested in bringing in new subscribers, not charging publishers.

“Our philosophy is simple – when Apple brings a new subscriber to the app, Apple earns a 30 percent share; when the publisher brings an existing or new subscriber to the app, the publisher keeps 100 percent and Apple earns nothing,” said Jobs on Tuesday. ”All we require is that, if a publisher is making a subscription offer outside of the app, the same – or better – offer be made inside the app, so that customers can easily subscribe with one click right in the app.”

Google One Pass is currently available for publishers in Canada, France, Germany, Italy, Spain, the U.K. and the U.S.

Tags: digital subscriptions, iTunes, One Pass

Companies: Apple, Google

People: Steve Jobs

Article courtesy of VentureBeat » deals

Plastyc just announced that it has raised $2 million to expand its financial services for the “underbanked”, namely people who don’t have bank accounts.

The New York startup said its products are aimed at the 60 million Americans who don’t go to banks or credit unions, and the “millions more” who are struggling to obtain credit cards or pay checking account fees. It offers iBankUp accounts that include a Visa prepaid card, a direct deposit number, and an online checkbook, but don’t require a credit check or a minimum deposit. (There is a small monthly fee and an ATM withdrawal fee.) It also offers prepaid Visa cards through its Upside program.

The company was originally aimed at a younger audience (the “y” in Plastyc is supposed to suggest “Generation Y”), but a Plastyc spokesperson said the customer base turned out to be broader, probably because of the recession. She pointed to data from Quantcast saying the main user demographic is 35 to 49 years old. There are 110,000 people who have signed up for Plastyc, and 75,000 monthly active users, she said, and they typically make less than $60,000 per year.

The funding comes from Core Innovation Capital, the investment partner for the Center for Financial Services Innovation (a research and advocacy organization that focuses on the underbanked). Plastyc said it will use the money to add services that help customers improve their savings and credit, and to offer a version that banks can sell with their own branding.

Tags: online banking, prepaid cards, the underbanked

Companies: Center for Financial Services Innovation, Core Innovation Capital, PlastyC

Article courtesy of VentureBeat » deals

Salesforce has hired IBM enterprise sales pro Jeff Lautenbach to head its enterprise sales division as it gets ready to take on some of the largest companies in the world as customers — and as rivals.

The company, which first made its name a decade ago as a provider of Web-based customer-relationship management software to smaller companies for whom traditional enterprise software was unaffordable, has finally realized it is playing with the bigger dogs in the park. The company’s major competition comes from other customer relationship management (CRM) software providers like Oracle. They aren’t run-of-the-mill tech companies, they are behemoths with massive revenues that demand a little more attention than some of the other smaller CRM providers Salesforce has typically competed with.

Lautenbach was with IBM — another major competitor for Oracle — for 20 years, where he manned the company’s 1000-strong enterprise sales team. He’ll be responsible for pitching the company’s service major enterprises — like Dell, a current Salesforce customer, for example — rather than Salesforce’s traditional strategy of targeting business managers.

Salesforce looks like it has been building up its resources to attack the enterprise market in full force — including some targets outside of its typical CRM software market. The company has acquired three companies in just under two months. Salesforce dropped a whopping $212 million for Heroku to bolster its development tools for its web services and picked up Manymoon to expand into some other cloud services.

The company also recently launched Chatter.com, an enterprise-style social network that is free and open to everyone. Salesforce does want to convince Chatter.com users to sign up for the official Chatter service, and then Salesforce’s CRM service, but it’s still a bit outside of Salesforce’s enterprise activity. Salesforce initially launched Chatter as a Twitter-like service to compete initially with Yammer and make a splash in the collaboration space.

Salesforce also recently named former Microsoft government sales guy Matt Miszewski to head the company’s government sales team.

Tags: CRM, customer relationship management, enterprise, enterprise sales

Companies: Dell, IBM, Oracle, salesforce, SAP

People: Jeff Lautenbach

Article courtesy of VentureBeat » deals

Natural language processing specialist Q-go was just acquired by RightNow Technologies for $34M. RightNow provides customer service products for the social media era, covering not just the customer support centre but every interaction with a company via its website, email, mobile apps, support communities and social media. Q-go provides natural language search which is currently mainly used in web sites.

Many web sites only recognize keywords in searches or provide static FAQs (frequently asked questions). But Q-go’s research shows that 70-80 percent of customers use more than two words in a query and 70 percent are unable to find what they are looking for.

Q-go’s technology recognizes the meaning and intention of a question rather than just matching words, e.g. “How do I cancel my subscription?” can mean the same as “I want to close my account”. By matching all versions of the same question with the correct answer, Q-go reduces customer support costs. Instead of having frustrated customers forced to contact a call centre (this costs $4-10 per call) or send a customer support email ($13-20 per customer including follow-up mails), they receive the correct answer immediately via the web site.

Q-go can also identity gaps in the answers a company is providing to customers’ questions. It’s easy to see how RightNow could take Q-go’s natural language search beyond the web site into email or social media interactions.

Q-go operates on a SaaS (software as a service) business model and supports all major Western languages. Major customers include banks, Telecommunications companies and airlines. These are among the industries most notorious for providing bad customer service so they can use all the help they can get.

Q-go was founded in 1999 and is based in Amsterdam.

Tags: customer experience, customer relationship manager, natural language search

Companies: Q-go, RightNow

Article courtesy of VentureBeat » deals

Let the people decide.

All the major banks – Lloyds Banking Group, Royal Bank of Scotland, HSBC and Barclays – are understood to be in discussions with major City investors about the performance criteria for 2011.Banks are embarking on a radical overhaul of the way they pay their senior executives by considering how they can link their bonuses to the way they treat customers and build up capital.

The move is a major departure from the traditional way of paying out bonuses, which has been done on the basis of how the bank’s share price has performed relative to rivals, and the institution’s profitability.

Bank Bonuses To Be Linked To Customer Satisfaction [Guardian]

Article courtesy of Dealbreaker