IBM PROMISES TO BUY BACK UP TO $12 BILLION IN STOCK
IBM pledged to buy as much as $12 billion of its own stock this year, a move that should boost the value of its per-share earnings. That’s a lot of money, but it wouldn’t be a record. Big Blue spent $15.7 billion on share buybacks in the second quarter of 2007, a quarterly record. It ranks third in stock repurchases over the past three years, at $34.3 billion. Exxon Mobil leads with $76.2 billion, followed by Microsoft Corp. at $57.4 billion.
Pay dirt
March marks the start of proxy season, when companies hold annual meetings and make disclosures ahead of board elections. Most closely watched are the executive- pay details. Early signs point to belt tightening in the executive suite. A sampling of CEO pay in 2007:
• Toll Brothers paid Robert Toll a package worth $7.1 million last year, less than half the $18.8 million he earned in 2006. But just in time for a housing-led economic downturn, the homebuilder’s board instituted a new executive bonus scheme that “would work effectively in all economic climates.” The new formula takes into account his leadership during tough times.
• Ken Lewis of Bank of America Corp. took home $4.3 million, down from $11.1 million in the bank’s 2006 fiscal year.
Homeowners get help
The mortgage lending crisis has wiped out billions of dollars in bank profits and erased trillions in value from global stock prices. But the pain is closer to home for communities with high foreclosure rates. Church groups are rallying to help residents who have fallen behind on payments. In New York City, the Catholic Church is hosting “Parish Mortgage Workshops” in poor and immigrant neighborhoods featuring representatives of housing organizations and loan counselors. “These are people in many cases who basically bought the American dream of owning a home and are working in many cases at least two jobs to carry the costs related to owning,” says Monsignor Alfred LoPinto, vicar for human services at the Diocese of Brooklyn.
“Double short” a new bet
“Double short” might sound like a coffee drink at Starbucks. But on Wall Street, the term refers to a magnified bet that an investment will decline in price. A new investment, DB Gold Double Short, trades like a stock and is designed to rise 2 percent for every 1 percent decline in the price of gold. It’s traded under the symbol DZZ. A similar investment is “double long.” It rises 2 percent for every 1 percent gain in gold. Its ticker symbol is DGP.
D. Sorid, J. Qi, The Associated Press
