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Matters Financial |
7 July 2003
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Tax Cuts May Wreck Economy
It is an article of faith among Republicans that tax cuts help the economy. It is a further article of faith that deficits are destructive of prosperity. The latest statement from the Bank of International Settlements should provide some exciting arguments over martinis and rare steaks this summer -- it suggests that by cutting taxes, confidence in national finances are undermined, thereby damaging economic recovery. Click here to read more.
Sometimes, the Brokers Are Innocent
Sometimes, a lawsuit deserves to be tossed out of court even if those being sued merit contempt. Judge Milton Pollack rightly dismissed a class action lawsuit last week against Merrill Lynch brought by those who lost money speculating in the dot-com bubble of the 1990s. And U.S. District Judge Harold Baer dismissed a similar case involving Goldman Sachs Group Inc., Morgan Stanley and the Credit Suisse First Boston and stock in Covad. When a gamble goes sour, the gambler should pay up and shut up. Instead, many on Wall Street are trying to welch, and Judges Pollack and Baer called them on it. Click here to read more.
Gucci's Profits are Not Disastrous
Gucci, the Italian luxury goods group, took it on the chin this quarter, with its operations losing €24.4 million. Analysts have dubbed it a "total disaster." While the combination of war, SARS, and euro appreciation hurt the group, financial and taxation gains kept net income positive. Although it was down from €35.5 million to €1.2 million, Gucci stayed in the black. How can this be a total disaster? Seems more like management pulled a rabbit out of the hat. Click here for our view.