Spain on the Cusp

Spain is on the cusp of something, but no one seems to know for sure what it is. The country received good news from Moody’s that kept Spain’s sovereign paper rating at investment grade. That had not calmed speculation the country will ask for aid from the European Central Bank to buy its paper and bring down bond yields. But that help would come with strings attached, unless the assistance comes in the form of a line of credit (maybe). The European Union would have to help Spain set a budget and then watch over it, or at least that is what powerhouse Germany would like. Some experts say Spain wants to avoid that fate and will try to finance its trouble on its own. Every other hour there is news that Madrid will plead for help or it won’t. According to Reuters:

A senior EU official said momentum has increased as resistance to the plan has fallen off in Germany, which has for weeks urged Madrid not to make the request. The official cautioned a formal application could still be weeks away.

“They are moving to a request, yet it may not happen today or tomorrow or this week,” said the official. “Germany’s moving and the timeline will depend on the Greek saga.”

Reading IBM, Intel Results

Analysts continue to sift through the earnings reports from International Business Machines Corp. (NYSE: IBM) and Intel Corp. (NASDAQ: INTC). Each released relatively weak results for the most recent quarter. The fates of their share prices probably were spared because the numbers “beat expectations.” But that does not tell what the actual states of the information technology or PC businesses are. The data from the two companies would tend to indicate that the economic slowdown has hit consumer and enterprise buyers alike. If so, the step toward a recession and the fiscal cliff have become more widespread than many analysts expect. A person will not buy a $500 PC and a company will not use IBM consulting services. The effects of the economy could hardly be broader than that. IBM management did admit that its sales problems were not isolated. The Wall Street Journal reports:

“We did start off the first two months of the quarter on a stronger trajectory than we saw for the full quarter,” Chief Financial Officer Mark Loughridge said, noting a “handful of deals” in the software business “fell out of the quarter” and into the current period.

The iPad Mini Is Coming

Apple Inc. (NASDAQ: AAPL) apparently is about to have another in a series of very public product announcements that stretch back over all of the years when Steve Jobs ran the company. As the number of announcements has increased, their impact has slipped. Apple management will show up for the most modest product releases. The latest new device from Apple will be a smaller iPad, something to compete with the Amazon.com Inc. (NASDAQ: AMZN) Kindle apparently. The Daily Titan reports:

Apple has all but confirmed the existence of the iPad Mini, with an event announced to take place Oct. 23 in Silicon Valley.

The current rumors pin the tablet to be between seven and eight inches in screen size, with the resolution expected to fall short of the “retina display” caliber found in the current 10-inch iPad.

Observers in the tech community also predict that the price will fall in the $300 range to compete with the bestselling seven-inch tablets from Amazon and Google.

Douglas A. McIntyre

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