WSF Headline Roundup - 3/14/08 - Most economists say 'recession'; Hedge fund Halcyon going pubilc; Cash is king at hedge funds; Dollar plunge / rebound; Oil, gold set records then retreat; Microsoft, Yahoo meet; AOL buying Bebo; Chrysler taking 2 wk break

• Most Economists in Survey Say Recession Is Here
• Halcyon Plans to Go Public; Sees $974 Million Value
• Funds stockpiling cash
• US Dollar plunge sets off global alarm bells
• Dollar Rebounds From Record Versus Euro on Intervention Concern
• Oil slips below $110 on profit taking
• Cash gold nears $1,000 level hit by U.S. futures
• Microsoft Pitches Merger Vision To Yahoo at Meeting
• AOL to Buy Bebo Networking Web Site for $850 Million
• Chrysler to Take Two-Week Break

Most Economists in Survey Say Recession Is Here - Wall Street Journal 

Economists in the latest Wall Street Journal forecasting survey are increasingly certain the U.S. has slid into recession, a view reinforced by new data showing a sharp drop in retail sales last month.
 
  "The evidence is now beyond a reasonable doubt," said Scott Anderson of Wells Fargo &   Co.

Thirty-six of 51 respondents, or more than 70%, said in a survey conducted March 7-11 that the economy is in recession.
 
  The Commerce Department said yesterday that retail sales fell 0.6% in February; sales excluding the volatile auto and auto-parts categories fell 0.2%. The declines reflect a sharp slowdown in consumer spending, which accounts for more than 70% of U.S. economic activity, as Americans grapple with high gasoline and food costs and declines in home values and other asset prices.....

Halcyon Plans to Go Public; Sees $974 Million Value - Bloomberg 

Halcyon Asset Management LLC, taking a cue from rival GLG Partners Inc., plans to go public in a reverse merger with a blank-check company that values the New York-based hedge-fund manager at about $974 million.
 
  Halcyon, which manages $11.5 billion, will be bought by Alternative Asset Management Acquisition Corp., a company that raised money in an initial public offering to finance acquisitions. Halcyon partners will get $505 million in cash and notes and own about 44 percent of the public company, the companies said in a statement today.
 
  The deal is similar to the takeover of GLG, Europe's third-largest hedge-fund manager, by Freedom Acquisition Holdings Inc. in November. Alternative Asset and Freedom Acquisition are special-purpose acquisition companies, or SPACS, also known as blank-check companies.
 
  Such companies have raised $9.62 billion since the beginning of October. Initial public offerings of SPACs have made up 81 percent of the dollars raised in the U.S. market so far this year, according to Bloomberg data....

Funds stockpiling cash - Financial Times 

Hedge funds have hunkered down and prepared cash piles in an effort to survive the market chaos that has taken out many leveraged funds and listed vehicles, such as Carlyle Capital, the highly-geared mortgage investor which defaulted on Thursday.
 
  The industry started this year with the lowest level of borrowing for many years, according to bankers, while many funds have built up cash to be able to buy when markets bottom out.
 
  “The strategic priority for hedge funds has shifted dramatically over the past few months from performance to capital preservation and survival first, then performance,” said Gunner Burkhart, head of European prime brokerage at Lehman Brothers.
 
  Hedge funds which did not anticipate the latest stage of the credit crisis and reduce their risk by cutting back borrowing have been hammered as banks called for more margins on loans while long positions fell.....

US Dollar plunge sets off global alarm bells - Daily Telegraph 

The dollar has plummeted against all major currencies on dire US retail sales and fears that the Federal Reserve may need to slash interest rates further to stop the downward spiral in the credit markets. 

The greenback broke below 100 yen in a day of wild trading, setting off alarm bells at Japan's Keidanren industry lobby. It touched a record $1.5620 against the euro and came within a whisker of parity with the Swiss franc for the first time in history.
 
  The plunge came amid an investor flight into commodities, seen as a way of insulating wealth from the dollar's decline. In the US, crude oil reached a record $111 a barrel despite rising   inventories.....

Dollar Rebounds From Record Versus Euro on Intervention Concern - Bloomberg 

The dollar rose from a record low against the euro and traded above 100 yen as securities firms speculated central banks will collaborate to shore up the U.S. currency for the first time in 13 years.
 
  Goldman Sachs Group Inc. and Morgan Stanley said coordinated action by policy makers to stem the currency's slide is increasingly likely. The gains limited the dollar's losses in a week when it fell to a 12-year low versus the yen, approached parity with the Swiss franc and traded above $2 per U.K. pound.
 
  ``The market is certainly on intervention watch,'' said Hans- Guenter Redeker, global head of currency strategy in London at BNP Paribas SA, France's largest bank. ``If I was in their shoes I would intervene in a concerted way that supported the dollar.''.....

Oil slips below $110 on profit taking - Reuters 

Oil slipped below $110 on Friday as investors took profits after prices hit a record $111 in the previous session, but the depressed dollar was seen limiting losses.
 
  U.S. crude for April delivery fell 47 cents to $109.86 a barrel by 9:30 a.m.. It touched a record for the seventh time in a row in the previous session and is up nearly 8 percent this month and about 14.5 percent this year.
 
  London Brent crude for April, which expires later in the day, dropped 35 cents to $107.19.
 
  "It's a bit of profit taking, but it should be quite limited especially since we're coming to the weekend ... The dollar still seems to be the main driving force of the day," said Gerard Rigby, an analyst at Sydney-based Fuel First Consulting....

Cash gold nears $1,000 level hit by U.S. futures - Reuters 

Spot gold jumped on Friday and held within sight of the $1,000-an-ounce barrier broken on the futures market after the dollar hit a record low against the euro, boosting the metal's appeal as an alternative investment.
 
  Gold has gained nearly 20 percent in 2008, driven by buying from investors and speculators on expectations of further interest rate cuts in the United States and record high oil prices, which raised its appeal as a hedge against inflation.
 
  Spot gold rose to $997.20/998.00 an ounce from $991.00/991.80 late in New York. It had powered to another record high of $999.90 an ounce on Thursday....

Microsoft Pitches Merger Vision To Yahoo at Meeting - Wall Street Journal 

Senior executives from Microsoft Corp. and Yahoo Inc. met Monday to discuss Microsoft's takeover offer for the Internet company, according to people familiar with the matter.
 
  The meeting, the first since Microsoft made its unsolicited offer Jan. 31, marks a breakthrough in communication between the two camps following Yahoo's rejection of Microsoft's offer last month.
 
  Still, the meeting wasn't a negotiation, and no bankers attended, these people said. The session was intended to allow Microsoft to present its vision of a combined company, and Yahoo executives mostly listened, one of the people said. No further talks have been scheduled.
 
  Yahoo has held similar meetings with other potential partners, including Time Warner Inc.'s AOL unit and News Corp., which owns Dow Jones & Co., publisher of The Wall Street Journal.....

AOL to Buy Bebo Networking Web Site for $850 Million - Bloomberg 

AOL, seeking to make up for falling subscription sales, agreed to buy Bebo for $850 million to gain the third-largest U.S. social-networking Web site and expand in online advertising.
 
  Bebo, which is closely held, has offices in the U.K., San Francisco and Austin, Texas, AOL, a Time Warner Inc. unit, said in a statement today. Bebo, which trails News Corp.'s MySpace and Facebook Inc., said it has 40 million worldwide members.
 
  Buying Bebo will bolster AOL in advertising for social- networking sites, a market that may almost triple to $2.5 billion in the U.S. by 2011, according to research company EMarketer Inc. AOL, whose sales slumped 32 percent last quarter as users dropped its Web access service, is offering for Bebo 47 percent more than Rupert Murdoch's News Corp. paid for MySpace in 2005.
 
  ``AOL's revenue growth continues to be challenging but their acquisitions continue unabated,'' said Laura Martin, an analyst at New York-based Soleil Securities, who recommends buying Time Warner shares and doesn't own any. ``The value will be determined by how well they monetize it.''....

Chrysler to Take Two-Week Break - Wall Street Journal 

Chrysler LLC plans to shut down the entire company for two weeks this summer as a cost saving move to "accelerate Chrysler's recovery and transformation," Chief Executive Robert Nardelli told employees in a memo distributed Thursday.
 
  Mr. Nardelli told employees they will have to take vacation for the weeks of July 7 and July 14 "in order to create better alignment and efficiency across organizational lines and boost productivity," according to the memo, which was reviewed by The Wall Street Journal.

Chrysler, General Motors Corp. and Ford Motor Co. usually shut down only their auto and component plants for at least two weeks each summer. GM has been conducting company-wide shut downs over the past few years as it has struggled to stem massive losses.....