Lucas123 writes “Attorney General Michael Mukasey claims that terrorists sell pirated software as a way to finance their operations, without presenting a shred of evidence for his case. He’s doing it to push through a controversial piece of intellectual property legislation that would increase IP penalties, increase police power, set up a new bureau to investigate IP theft, and more. ‘Criminal syndicates, and in some cases even terrorist groups, view IP crime as a lucrative business, and see it as a low-risk way to fund other activities,’ Mukasey told a crowd at the Tech Museum of Innovation last week.”

Read more of this story at Slashdot.

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Skewz.com isn’t the Microsoft-funded Blews experiment that is supposed to help detect rightness and leftness in stories based on blogs that link to them. Instead of detecting blog links, Skewz relies on readers to submit and rate stories, and even tries to pair stories that have “liberal” and “conservative” biases so that you can get multiple takes on the same event or pronouncement. The Skewz About page explains how it works. The site has drawn a fair amount of “media insider” attention, including a writeup on the Poynter Institute website. But what does all this mean? Where is it going? Can Skewz.com help us sort our news superior and make more informed decisions? We don’t know. But if you post a question here for founder Vipul Vyas, maybe he’ll have an answer for you. (Please try to follow the usual Slashdot interview rules.)

Read more of this story at Slashdot.

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Filed under: Major movement, Good news, Industry, KB HOME (KBH), Options, Technical Analysis, Politics, Housing

KB Home (NYSE: KBH) shares are rising with other homebuilders after US Senators from both political celebrations concurred to draft legislation that could deliver billions of dollars to homeowners facing foreclosure. The Senators hope to bring a bill to the floor as early as this afternoon. If you think that the company won’t fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on KBH.

After hitting a one-year high of $48.67 in Might, the stock hit a one-year low of $15.76 in January. KBH opened this morning at $26.74. So far today the stock has hit a low of $26.50 and a high of $28.86. As of 12:30, KBH is trading at $28.48, up $1.55 (5.8%). The chart for KBH looks bullish and steady, while S&P gives the stock a negative 2 STARS (out of 5) sell rating.

For a bullish hedged play on this stock, I would consider a Might bull-put credit spread below the $17.50 range. A bull-put credit spread is an options position that combines the buy and sale of put options to hedge risk in case the stock doesn’t do what you think but still leverage nice returns. For this particular trade, we’ll make a 4.2% return in just 7 weeks as long as KBH is above $17.50 at Might expiration. KBH would have to fall by more than 38% before we would start to lose money. Learn more about this type of trade here.

KBH hasn’t been below $17.50 since January and has shown support around $24 recently. This trade could be risky if the housing market gets even worse, but even if that happens, this position could be protected by the support the stock might find around $22, where it bottomed out a few weeks ago.

Brent Archer is an options analyst and writer at Investors Observer.

DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls positions in KBH.

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Filed under: Economic data, Bear Stearns Cos (BSC), Housing, Federal Reserve, Recession

Federal Reserve Chairman Ben Bernanke isn’t promising anyone a rose garden at least until next year.

In testimony before Congress this day, Bernanke paints a pretty grim picture and even goes so far as to say that, “Overall, the near-term economic outlook has weakened relative to the projections released by the Federal Open Market Committee (FOMC) at the end of January. It now appears likely that real gross domestic product (GDP) won’t grow much, if at all, over the first half of 2008 and could even contract slightly.”

Bernanke anticipates economic activity to improve in the second half of the year because of the stimulus package, and growth to improve in 2009 as housing begins an anemic rebound. He quickly added that the uncertainty “attending this forecast is quite high and the dangers remain to the downside.”

Not surprisingly, Bernanke also defended the bailout of Bear Stearns Cos. (NYSE: BSC), arguing that allowing the Wall Street firm to fail would have had effects that would have been “severe and extremely difficult to contain.” He also mentioned that he remained optimistic about the economy’s long-term prospects even as it goes through a difficult period.

Interestingly, in the question-and-answer session, Bernanke stated the Fed was urging firms to get more capital and that it had staff at the investment banks to monitor them. He argued that there was a “false dichotomy” to ask why homeowners aren’t getting the same deal as Bear Stearns.

“I certainly hope and don’t expect a repeat of this episode,” he told Sen. Chuck Schumer (D-NY), denying that Bear was bailed out. “We did not have an early warning on the most recent episode.”

Bernanke rightly called for Congress to take action to help homeowners hurt by the housing downturn. The problem that many politicians have is that they’ve to explain to their constituents why a bunch of Wall Street fat cats got government help and millions of homeowners in danger of losing their houses are out of luck.

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Filed under: Housing

Over 4,500 call the Hope Now hotline (1-888-995-HOPE) every day. The callers are homeowners in deep trouble with their mortgages, and Hope Now was established in October, 2007 to help people just like them. The problem is, Hope Now doesn’t seem to be doing much to help them.

At least that’s according to a report in The New York Times this day. The basic problem is that Hope Now, which is backed by the White Home, is operated by the very financial corporations that are foreclosing on people’s houses. And, not surprisingly, the group has been accused of putting the interests of mortgage lenders and loan servicers ahead of homeowners. The main thrust of their advice, when they give it, directs homeowners to catch up on their payments, not to rework their mortgages to a more inexpensive level.

Michael Shea of the Acorn Housing Corporation, says “Hope Now is a failure. . . It’s industry-dominated.” Hope Now claims it has many success stories — but couldn’t provide any for the Times article. According to the Homeownership Preservation Foundation, only 4% of callers to Hope Now end up speaking to a housing counselor.

Hmmm, a group backed by the Bush administration that’s really a bunch of industry shills. Now what in the last eight years could possibly make you think that could be true? Heck of a job, Hope Now!

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Filed under: Earnings reports, Products and services, Consumer experience, Competitive strategy, Apple Inc (AAPL), Research in Motion (RIMM), Palm Inc (PALM)

When you’re a small country stacked right up against the mighty U.S., you tend to take pride in any success by a fellow countryman. Such is Canada’s fate, and if you ask any Canadian, he’ll be able to name you all the Canadian actors who made it in Hollywood. Similarly, ask about successful companies and Canadians will proudly mention Research in Motion Ltd. (NASDAQ: RIMM). Indeed, the company did not disappoint this afternoon when it reported that fiscal fourth-quarter profit and sales more than doubled.

The BlackBerry maker earned $412.5 million, or 72 cents per share, up from a profit of $187.4 million, or 33 cents per share, in the same period a year earlier. Revenue more than doubled to $1.88 billion from $930 million. This beat expectations of 70 cents per share and sales of $1.86 billion. And that’s not all. A key figure, subscriber base, was boosted as RIM shipped about 4.4 million of its smartphones and added 2.2 million new subscriber accounts during the quarter, bringing its total subscriber base to more than 14 million. Sure enough, the company also projected profit and sales for this quarter above analysts’ estimates. One cause for concern is RIM’s contracting gross margin as the company relies more on hardware sales.

According to the company, it was retail presence as well as an expanded product line that included enhanced smartphones with cameras and music-playing abilities, like the Curve, that helped boost sales. While such features put it in competition with Apple Inc. (NASDAQ: AAPL)’s iPhone, Apple was already adding improved features to the iPhone to attract business customers, so it seems competition was inevitable. RIM plans to have even more products with more features to appeal to consumers. Despite the competition, according to different research firms, both RIM and Apple are increasing their market share in the smartphone segment for now, mostly at the expense of Palm Inc. (NASDAQ: PALM).

And if you think RIM has reached a saturation point, let me remind you that two-thirds of its customers are in North America. There is still a huge world to expand to out there. In fact, global expansion has already contributed to its performance in the fourth quarter.

It’s no surprise RIMM shares are up some 4.7% in after-hours trading.

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Filed under: Products and services, Industry, Southwest Airlines (LUV), Personal finance, JetBlue Airways (JBLU)

I have had some clients ask me, what industry I think will benefit from the $600 rebate checks that are due to be sent out as part of the U.S. economic stimulus package. I think airlines will benefit, especially lower cost carriers like Southwest (NYSE: LUV) and Jet Blue (NASDAQ: JBLU).

The USA This day has an article about the kind of vacation you can have for $600. The article says: “With most Americans expecting to receive a tax rebate of up to $600 ($1,200 for married couples), there are plenty of ways to get the most vacation for your buck, say travel experts. Whether it’s a cruise, a tropical paradise, or family travel, these trips can all be done for under $600 a person.”

Because we aren’t speaking about flying around the world or across the Atlantic for that measure, trips to Las Vegas or Orlando, for example, will fit the family, and of course people need a way to get to these destinations, so that’s how the airlines become interesting. Throw into the mix potentially stable or even lower fuel costs, and for investors looking for a way to play the “Rebate check” game, you might want to take a look at the airlines.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer’s fund has no position in any stock mentioned, as of 4/2/08

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Filed under: Other issues, Products and services, Industry, Consumer experience, Rants and raves, Competitive strategy, Amazon.com (AMZN), Marketing and advertising, Books

In the last few days, bookselling giant Amazon.com Inc (NASDAQ: AMZN) has made a few more enemies in the publishing world by forcing the little-known group of print-on-demand (POD) publishers to either submit to using its POD subsidiary, Booksurge, or risk being prohibited from selling on its industry-leading website. No matter the cost and complications of breaking off relationships with other vendors, reformatting books and a host of other problems, Amazon laid down the law, saying convert — and do it swiftly — or face the consequences.

What’s more disconcerting is that an official press release was made public only after smaller publishers like Angela Hoy of Booklocker.com started writing publicly about blackmail-type phone calls from Booksurge representatives. Fearful of losing their businesses literally overnight, many POD publishers such as iUniverse and Lulu have capitulated while strong willed publisher PublishAmerica refused to give in — and was swiftly made an example of when Amazon disabled the purchase buttons on their book titles!

As an author selling my own critically-acclaimed POD book An American Hedge Fund on Amazon, outrage has compelled me to write about how unethical and more importantly, monopolistic this all is.

In a short-term business sense, Amazon is right to use its huge size to gain marketshare for Booksurge and squeeze out the smaller players, but the problem is this goes against what made it great — offering the lowest prices and widest selection, basically like an online Wal-Mart Stores Inc (NYSE: WMT). To authors and publishers, Booksurge is known for its poor product quality and high cost structure, supremely inferior on both fronts to rival Lightning Source (LS) — trust me, I did the research and that’s why I selected LS — the POD subsidiary of Ingram Industries, the leading book wholesaler and the company on which Amazon has clearly declared war.

So, by making Booksurge the only POD option, relegating quality-loving publishers and authors to much smaller websites of Borders Group (NYSE: BGP) and Barnes & Noble Inc (NYSE: BKS), Amazon proves it no longer loves its customers getting the widest selection at the cheapest prices — oh yes, even publishers that give into Amazon’s demands will be forced to raise their prices — it cares more about its own profits.

Until this latest development, I believed Amazon was the future of bookselling. It was making money, as were the publishers and customers who received the cost/quality benefits, but when a company happily alienates its suppliers whose hardships will inevitably be felt by the company’s customers, I cry foul.

Authors, readers, consumers and businesspeople unite! Sign THIS petition and let Amazon know what it is doing is wrong. That it is only a retail giant because we, the consumers, say so. We, not it, have the power here. While POD publishing is just a tiny niche, it’s a slippery slope; if you let Amazon get away with this, it might be your business and industry it comes after next.

Timothy Sykes writes the blog timothysykes.com, is a former hedge fund manager, star of the Television show Wall Street Warriors and author of the book, An American Hedge Fund: How I Made $2 Million as a Stock Operator & Created a Hedge Fund

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Filed under: Products and services, Consumer experience, Competitive strategy, Wal-Mart (WMT), Amazon.com (AMZN), Target Corp. (TGT), Ideal Purchase (BBY)

First, let me admit something up front — I am behind the times. I’m not part of the texting culture because I do not own a cell phone. This makes me odd, I know, and I probably will own one of these devices sooner rather than later, but for now, I have to call myself what I am — a texting virgin. Nevertheless, I read with interest the following article about a new initiative by Amazon (NASDAQ: AMZN).

The article says that Amazon is launching a program called TextBuyIt, where users can get information on products by searching for them via a name/description or a UPC number. Here’s the big kicker from the article, though: the author points out that people can, of course, do shopping even while they find themselves in competing real-world stores. So, if a hip texter is in a Ideal Buy (NYSE: BBY) or a Target (NYSE: TGT) or a Wal-Mart (NYSE: WMT), maybe stated hip texter might buy a product from Amazon instead of buying it from where he’s at. That’s the implication of the service, at least.

I’m not sure if I buy that this service will add much value to Amazon’s current mobile offerings, though, at least in the short run (also, it sounds like a complicated task to perform). Thing of it is, when you’re on the go, while you might use your cell phone to play games and acquire information, and maybe even put in an order for a stock or two, I’m not sure that anyone outside the most hardcore tech demographic would want to begin shopping on Amazon via texting. I mean, if you’re in a store, you probably would want to purchase an item from a store, right? Plus, if you’re on the go, you would probably want to just pop into a nearby store to purchase something if you’ve the urge.

I see the value of brick-and-mortar retailers using texting to establish relationships with customers — e.g., “text in an order and we’ll have it ready for you at the front when you pull in,” sort of like texting a pizza order. For all I know, that might already be happening somewhere. But, I’m not confident this will work for Amazon in the exact competitive fashion it envisions. However, I’ll acknowledge that it is something Amazon must nevertheless experiment with to cover its bases; after all, even though I am not currently part of it, we’re in a texting zeitgeist, whether we care about it or not…

Disclosure: I don’t own shares in any of the companies mentioned here; positions can change at any time.

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Filed under: Products and services, Competitive strategy, Google (GOOG)

Google Inc.’s (NASDAQ: GOOG) existing Google Docs web-based productivity product just became quite a bit smarter. Like it or not, that product just became a front-and-center competitor to Microsoft Corp.’s (NASDAQ: MSFT) Office software by becoming available to use without an world wide web connection.

Sounds like a minor event, but Microsoft’s Office productivity software suite brings in billions of dollars in revenue per quarter. It’s one of the company’s most lucrative software packages, and although there have been freely available alternatives for quite some time, Microsoft Office still reigns supreme for word processing and spreadsheets. One of Google’s big problems with most of its products centers around offline access. Customers need to have an active internet connection to work with virtually all of its web-based products.

Will Google’s word processing and spreadsheet programs start taking a bigger bite out of Microsoft’s Office by offering workable access without an internet connection? For some customers, yes. Tyler Dikman with Cooltronics says this move “gives Google a more massive pool of users to go after with more potential to increase their market share. And it sends a wake up call to Microsoft that Google Docs isn’t some experiment. This is something Google is investing a lot of time and money to make work.”

This might seem like a small step from Google Docs, but it’s aimed squarely at Microsoft. Whether Google can make inroads into the office software productivity market remains to be seen. However, its efforts just took a massive leap.

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