Sorry or not Chip, you are still a blockhead.
Lululemon (LULU) founder Chip Wilson apologized last Friday for asinine remarks he made about women's bodies during a Bloomberg TV interview. We'd like to say "publicly" apologize, nevertheless, that does not seem to be the case as Wilson directed his groveling at his employees rather than his customers and, more importantly, the world's entire female population.
"I'm sad, I'm really sad, I'm sad for the repercussions of my actions, I'm sad for the people of Lululemon who I care so much about, that have really had to face the brunt of my actions," said Wilson in a video posted on YouTube. "For all of you that have made Lululemon what it is today, I ask you to stay in a conversation that is above the fray." "Above the fray"? Have you flipped Wilson? You created this cockeyed controversy when you told Trish Regan that your company's yoga pants "don't work" for some women's figures. And now your workers are being dragged deeper in and your stock -- down almost 10% this year -- deeper under because of your half-assed apology. Honestly Chip, have you already forgotten last March's recall of Lulu's overly sheer pants? That's right, the one that cost your company nearly $70 million in sales and likely led to the unexpected June departure of Lulu's former CEO Christine Day? Talk about sheer madness! The real "fray" Lululemon should be worried about, as opposed to this nonsense, is the fraying that's going on with its pants. Pilling complaints are piling up and its hurting sales. "It's really about the rubbing through the thighs, how much pressure is there over a period of time and how much they use it," said Wilson. No, it's really about a big-mouthed moron repeatedly rubbing people the wrong way.
Is it just us, or is everybody else starting to miss the relative quiet of Alan Greenspan's Federal Reserve?
No, we're not commenting on Greenspan's policies as the nation's top banker. Those who wish to praise his handling of America's money supply during his nearly two decade tenure, please feel free. And those clamoring to condemn his deregulatory propensities, be our guest as well.
Once again, how you feel about the "Maestro's" music -- economic and otherwise -- is entirely up to you. That said, it is getting harder and harder for us not to wax nostalgic about the days when the Fed's conductor didn't just set the tone, but kept his band members from unexpectedly popping off into dizzying solos. Sans metaphor, Greenspan may have babbled unintelligibly during his Congressional hearings, nevertheless, at least he kept his charges from doing the same to every media outlet in sight. Greenspan successor Ben Bernanke's push toward transparency is great and all, yet all this volatility sparked by every last Fed member's every last hiccup has reached unbearable levels. Case in point, Richard Fisher, the Dallas Fed President with his own mug on the set of Squawk Box, said Tuesday, "We've changed and impacted the markets because of our intervention and I understand there's sensitivity, but markets should also bear in mind that this program cannot go on forever." Here's an idea Richard, if you believe your actions are causing dangerous fluctuations in stocks, then stop talking. If you have something to say, then bring it up with your current boss Bernanke or his probable successor Janet Yellen. All your chattering is only forcing traders to increase their dependency on people like yourself. And Fisher's not the only regional Fed President churning stocks with each and every CNBC appearance. It's also James Bullard out in St. Louis and a few more who should probably be nameless, yet aren't. (Minneapolis Fed President Narayana Kocherlakota! Now there's a name we need not know.) Consider last Monday's headline on TheStreet: "Fed's Bullard Boosts Stocks." Let's be serious folks. The name "Bullard" should not be making waves in the stock market. Not even ripples. Buffett yes. Bullard no. Yeah, we know these Fed big-wigs have a right to speak when and wherever they want. Still, if Wall Street traders now care more about each Fed member's feelings than the latest batch of corporate earnings then it's time for these bureaucrat bankers to cut back on the rubber chicken circuit. Don't worry. We'll still hear their unbridled opinions when the Fed's minutes are released, so we'll know what's on their mind. It just won't be reflected in the VIX, aka the market's fear index, every day. One more point about shutting up before we do so ourselves. What brought the topic of Fed-speak (literally) to our very dumb minds was a Monday WSJ piece by Andrew Huszar, a Rutgers professor and former Wall Streeter, who self-professedly managed the Federal Reserve's multi-multi-billion dollar bond purchase program. Huszar kicks off his op-ed by saying, "I can only say: I'm sorry, America." He then goes on to apologize for his role in turning the Fed's "bond-buying experiment" known as quantitative easing into "the greatest backdoor Wall Street bailout of all time." Why this self-serving schmuck is apologizing to "America" then passing the buck (actually $1.25 trillion bucks) to Bernanke is beyond us. It's almost as ridiculous as Fisher or Bullard or one of the other puffed-up Fed-heads talking to "the market" as if he were Marc Antony talking to his friends, Romans and countrymen. How about this for your next soliloquy Huszar? "I come to bury Bernanke, not to praise him." Look. We can all rest assured that if Bernanke's bond-buying experiment doesn't work out then we'll get a rash of similar opinion pieces as every last person involved with the program scrambles for cover. Plausible deniability is the name of the game in Washington, just as profits are the modus operandi on Wall Street. In the meantime, we can all reminisce about the time when the only member of Greenspan's entourage that spoke publicly was his briefcase.
We here at the Dumbest lab have seen IPOs postponed for all kinds of outlandish reasons, yet never due to a season-ending back surgery before.
Until now that is.
Fantex, which filed with the SEC last month to raise $10.6 million in an initial public offering, scrapped its plan to sell shares at $10 apiece Tuesday after Houston Texans running back Arian Foster revealed his back injuries were too great for him to return to the playing field. Foster pledged 20% of his total earnings to Fantex in exchange for a chunk of the IPO proceeds, making him the first ever professional athlete to go public. Foster is eligible to make as much as $23.5 million through the 2016 season on top of sponsorship deals with Under Armour (UA) and Kroger (KR). "We continue to support Arian and his brand, and we wish him well in his recovery," said Fantex CEO Buck French in a statement. "We will continue to work with him through his recovery and intend to continue with this offering at an appropriate time in the future based on an assessment of these events." Frankly French, we're sorry about Foster's injury derailing your IPO, but this whole scheme never did cut the mustard. As TheStreet's Antoine Gara pointed out in a column last month, investors were less buying into the now-sidelined Foster as opposed to the money-losing Fantex. "Holders of shares of Fantex Series Arian Foster will not have an ownership interest in our Arian Foster Brand, or any of our affiliated entities. Rather, investors in our Fantex Series Arian Foster will be our common stockholders," said the company in its S-1 filing. In other words, the idea that football fans would be investing in their favorite player based on his yardage potential was pure fantasy. The real scheme was to buy shares in a brokerage called Fantex that signs up players like Foster and 49ers tight end Vernon Davis and offers them liquidity. Davis, by the way, went down with a concussion in San Fran's loss last Sunday to the Carolina Panthers. He was Fantex's next big catch after Foster. Hopefully Davis recovers from his injury and is soon cleared to play. As for Fantex, well, anybody buying shares in that IPO if it ever comes back around ought to follow Vernon's lead and have his head examined.
Somebody get us a Tylenol. Our brains are hurting from trying to figure out how Johnson & Johnson's (JNJ) stock keeps going up when the company keeps screwing up and paying up.
J&J, which sold $70.5 billion worth of products in the past year, will pay over $4 billion to resolve thousands of lawsuits over its recalled hip implants, according to a slew of media reports Wednesday. The settlement, which will be the largest ever for a U.S. medical device-maker and formally announced next week, will put to rest more than 7,500 lawsuits against J&J's DePuy unit. The company will reportedly pay an average of $300,000 to patients who claimed their hip implants were defective.
The $4 billion payout comes on top of the nearly $1 billion J&J has spent on medical costs and informing patients and surgeons about the recall. It is also the second multibillion-dollar agreement this month for Johnny John. The world's largest drug company announced last week that it will pay $2.2 billion to resolve criminal and civil probes into its marketing of the anti-psychotic drug Risperdal. Not that $6.2 billion worth of settlement dollars heading out the door is harming the stock too much. Shares of the company, up 32% so far this year, barely budged on Wednesday's news. Who knows why investors are acting so blase about all the billions J&J is ponying up for its bad behavior? Perhaps all the fines that have accrued during the past few years have rendered them dumb . . . sorry, we meant numb. This summer, for example, J&J paid $23 million to settle a class action lawsuit alleging it failed to disclose manufacturing violations, as in dirty plants, leading to the biggest recall of over-the-counter children's medicine in U.S. history. And back in 2011, J&J agreed to pay $70 million to settle claims that it bribed doctors in three European countries, and made kickbacks to Iraq to illegally obtain business under former leader Saddam Hussein. Here's an idea! Maybe the stock is reacting so well because all these problems occurred during the tenure of CEO William Weldon, who retired last year and was replaced in the corner office by Alex Gorsky in April 2012. Now that these issues are finally behind the Band-Aid-selling behemoth, stockholders can at long last look to the future with a sense of optimism. We just wonder if Weldon plans to return any of the $143.5 million in retirement pay he received considering all the money his company is being forced to give back. Actually, forget it. That's just going to give us an even bigger headache.
"Bad idea! Back to the drawing board."
No, those weren't our words describing what happened to JPMorgan Chase's (JPM) failed attempt at a public Twitter (TWTR) question-and-answer session. Spokesman Brian Marchiony emailed those statements out Wednesday after the event with bank executive Jimmy Lee, which was scheduled for Thursday afternoon, was cancelled due to a flood of insulting tweets.
To which we here at the Dumbest lab say: Thanks, Brian for doing our job for us! We may have been a bit harsher, yet you certainly captured our sentiment. That said, we still wonder why the seemingly intelligent people running America's biggest bank would even consider such a stupid move. How on God's green earth, or even his colorless Cyber-space, could somebody with a college degree, or even a kindergarten diploma, believe that opening up an event like this to the public would not end badly? Here are a smattering of the bountiful tweets belittling the bank, which is now negotiating a multi-billion dollar settlement with the government over its bad behavior during the mortgage bubble: "Between u & me...Name one area of the financial markets you are not manipulating." "Does Jimmy Lee really cheat at golf?" "How do you decide who to foreclose on? Darts or a computer program?" "What's your favorite type of whale?" "What's the best way to get blood stains out of a clown suit?" You get the idea. To which we say: Thanks also to all you tweeters out there for doing our job for us! -- Written by Gregg Greenberg in New York Follow @5gsonthestreet
Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.
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