The tension over the financial crisis has risen at an astonishing rate in just three days. Downgrades of the sovereign debt of several nations have rattled the markets. But the most immediate trouble is at a smaller and more imminent stage. Private investors have broken off talks with Greece, although the talks have reconvened. The lack of a deal with these investors could throw the southern European nation into default. Also, the problems of Ireland have quietly worsened as its GDP growth rate appears to have moved closer to zero. It may need another tranche of bailout capital.
Apple iPad 3
Apple (NASDAQ: AAPL) probably will release a new version of its iPad, called the iPad 3, within two months. The upgrades to the product will be important. It will have a quad-core processor, which will make it the “fastest” tablet on the market. Its screen will be upgraded to high definition, a critical issue with multimedia users. The most important change will be that the iPad 3 will work on 4G LTE ultrafast wireless networks. These networks have become the most highly marketed products for AT&T Wireless and Verizon Wireless. Apple has been slow to market with a compatible product. That has allowed several Google (NASDAQ: GOOG) Android devices to get 4G footholds. Apple could reverse those gains this spring with the iPad 3.
Hulu Original Programming
Video website Hulu, owned by NBCUniversal, News Corp. (NYSE: NWS), Walt Disney (NYSE: DIS) and Providence Equity Partners, says it will launch its own programming. The first series will be called Battleground. There is little reason to be optimistic that the new project will help Hulu. The number of content businesses controlled by cable companies and major media firms is too large to allow a company of only modest size to compete. Netflix (NASDAQ: NFLX) will move into content creation. And there is no reason to believe that Apple and Amazon.com (NASDAQ: AMZN), each of which has a distribution system, will not do so as well.
China’s GDP
New economists’ predictions are that China’s growth will drop to a three-year low, as fourth-quarter GDP moved higher by only 8.7%, according to new estimates. That growth rate is still extraordinary, but whether it can support the manufacturing capacity of the People’s Republic and its new middle class is a worry. China cannot be “decoupled” from the balance of the global economy. Lack of a financial recovery in the UK, EU, U.S. and Japan are too great a burden. And the Chinese middle class cannot grow without expansion in its production and export sectors.
Douglas A. McIntyre
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