NEWS AT A GLANCE
Home builders, too, struggle in down market
Home builders are having as bad a time as homeowners, or worse, as tightening credit and the slumping housing market are threatening to sink small builders and gouge larger publicly traded ones. “It’s impossible to build anything today at a profit, so builders are either taking losses or have pretty much stopped building,” said Mick Pattinson, CEO of California builder Barratt American. (Los Angeles Times) The housing industry generally, and some home builders, stand to benefit from a massive housing bill, passed by the House yesterday, that is expected to become law next week. The bill is designed to prop up the market, but also includes $3.9 billion to help cities buy and fix up foreclosed homes. (The Washington Post)
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Amazon profits from online buying shift
Web retailer Amazon said its second quarter profit doubled, to $158 million, as its revenue rose 41 percent, to $4.06 billion, topping analysts’ expectations. Amazon CEO Jeff Bezos said high gas prices probably gave Amazon a “relative advantage” over brick-and-mortar retailers. “Even just driving 10 miles these days is a few dollars worth of gasoline,” he said. (AP in Yahoo! Finance) The earnings were boosted by a $53 million sale of Amazon’s European DVD rental business. Still, Internet sales at chain stores like J.C. Penney and the Gap have shown similarly strong growth. “Amazon’s growth is fueled by behavior shifts rather than consumer-spending shifts,” said analyst Scott Tilghman at Soleil Securities. (Bloomberg)
Credit Suisse beats estimates
Credit Suisse, the No. 2 Swiss bank, reported a 62 percent drop in quarterly profit, to $1.18 billion. Analysts had been expecting a profit of about $300 million, though, and Credit Suisse shares rose in early Swiss trading. (MarketWatch) Strong results from its wealth management business, a return to profitability in its securities unit, and a paltry $21 million in net writedowns helped keep Credit Suisse profitable. “Credit Suisse has been able to cut risky positions a bit faster than probably the average in the sector,” said Guy de Blonay at New Star Asset Management. Of the other major banks that have reported so far, Goldman Sachs, Morgan Stanley, and JPMorgan posted profits; Citigroup lost $2.5 billion. (Bloomberg)
Seeking inner peace amid market chaos
As the markets stay turbulent, a growing number of bankers, traders, and money managers are looking for moments of peace in the ancient Indian discipline of yoga. Several firms in London and New York now host yoga classes for employees during work hours, and Pimco bond guru Bill Gross says he gets some of his best ideas while standing on his head, in the sirsasana pose, during his daily yoga sessions. Many financiers say that yoga helps them deal with the stress of the market and the job. But while this trend is profitable for some yoga instructors, others see an inherent conflict. Finance “is the antithesis of what yoga is about in terms of inner peace,” says London-based yoga teacher Claire Missingham. (The Wall Street Journal)
