Money & Investing - Banks.com

For quite some time now, Motorola Inc (MOT) has been losing market share in the handset game. Motorola cell phones and accessories have been floundering, bringing the rest of the company down. This morning, however, Motorola has found a way to stem the losses. Reuters reports on the latest decision by Motorola:

Motorola Inc said on Wednesday it would split into two publicly traded entities to separate its loss-making handset division from its other businesses, sending its shares up more than 10 percent.

This is a smart move for Motorola Inc, which has been seeing profits from its other business interests, which include public safety, network equipment and enterprise. By changing the structure of the company, Motorola will be offering different focuses, and diversifying the opportunities for investment in the company.

MOT saw a little jump on the news, as investors signaled approval of the move, which is set to be completed next year. Shareholders of MOT will be offered a tax-free distribution as the changes take place. This is probably another bonus for many investors.

The deal isn’t assured, however. There is still a rather ugly proxy battle going on right now with Carl Icahn. He is suing Motorola, demanding documents related to the mobile devices division of Motoroal. Additionally, more tax and legal analysis needs to happen before the split can be finalized.

MOT offers an interesting opportunity for you investment portfolio. If you believe that company offers solid value and that its management practices will eventually lead it through the hurdles, then it might be a good, cheap addition to your investment portfolio. On the other hand, if you have misgivings about the way this will all play out, it might be better to stay away.

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional.

Tags: Motorola Inc MOT, Motorola split, Carl Icahn, investment portfolio,
investing blog, stock investing advice, stock market news

Gold bulls are happy to see that the precious metal is on the rise again. After a dramatic drop ahead of the Easter holiday, gold is on its way back up. This is where things get tricky, since the commodities market, like all markets, is volatile.

Should you invest now, hoping that the price (which is right less than $930 an ounce for gold futures) will rise? Because when gold gets back over $1,000 an ounce, as some predict it will, that is not the time to buy. Here is what MarketWatch reports about gold futures this morning:

“Some investors and speculators feel that the sell-off is overdone and the metal may have become oversold in the short term,” said Mark O’Byrne, executive director at Gold & Silver Investments Ltd.

“While there may be further consolidation at these levels, gold will likely resume its upward march sooner than expected,” he said in a research note.

Do you agree? If so, now is the time to invest in gold. Active traders will want to invest and hold until they’ve made a hefty profit, and then take those profits. The trick is buying while there is a lull in the price, and selling while the price is high — before all the profit-taking kicks in.

Gold bulls will tell you that having gold is a good idea, regardless. While futures are more ethereal (and therefore can be more profitable) than investing in gold bullion itself, there are many arguments in favor of a tangible asset. The choice really depends on what you are comfortable with.

If you are going to invest in gold (futures or bullion) keep something in mind: Gold usually moves inversely to the US dollar. So, as the US dollar weakens, gold prices are supported.

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional.

Tags: gold futures market, invest in gold, gold commodities market, US dollar weakness,
gold rising market, investing blog, gold bullion

JPMorgan (JPM) is increasing the amount of the offer it made last week to purchase Bear Stearns (BSC). Originally JPM offered $2 a share for BSC stock. After last week’s rally by the financial sector, though, and the fact that many BSC stockholders vowed to fight the deal, things have changed and are now moving in a different direction. The New York Times reports on the new arrangement between JPMorgan and Bear Stearns:

In Monday’s statement, the banks said that the directors of both companies had approved the amended agreement and the purchase agreement. In addition, Bear’s directors have indicated that they intend to vote their shares — worth almost 5 percent cent of Bear’s shares after the dilution of issuing shares for JPMorgan — giving JPMorgan nearly 45 percent of the vote and a virtual guarantee that the deal will be approved by shareholders.

While this move will probably placate shareholders, it still remains to be seen whether this will help the economy. After all, reports BloggingStocks, the New York City economy has become rather dependent on Wall Street, and in some cases the New York City economy’s problems may drag the rest of America down. Peter Cohan points this out about the current situation on Blogging Stocks:

I don’t know whether the U.S. government has enough money to bail out all those bogus bets. So while New Yorkers will see the value of their real estate decline, the U.S. could end up going into the financial tank trying to bail out the industry that employed a third of them.

I agree that an awful lot is being done on behalf of investment banks. Unfortunately, much of it is being done with taxpayer dollars. Ultimately, would a recession really hurt most “regular” Americans? And would it force our financial sector to re-assess the ways it’s been doing things? We may never know, since the Fed seems bent on making sure that Wall Street gets the cushion it needs. Let’s just hope it doesn’t cost us too much.

What do you think of the way the economy is going?

Disclaimer: I am not an investment professional. Nothing in this piece or on this Web site should be construed as investment advice. Before making investment decisions, do your own research and/or consult with an investment professional.

Tags: BloggingStocks, JPMorgan Bear Stearns, investing banks, stock investing blog,
JPMorgan (JPM), Bear Stearns (BSC), Fed recession economy