5 Dumbest Things on Wall Street: Oct. 9


The Independent Spikes Gold

NEW YORK (TheStreet) -- James Bond creator Ian Fleming has nothing on reporter Robert Fisk.

Fisk wrote in the British broadsheet The Independent this week that finance ministers and central bank governors from Russia, China, Japan and Brazil have been holding "secret meetings" to work on a scheme to replace the U.S. dollar as the currency in which oil is traded. The article, which caused gold to surge to record highs this week, said that a number of Gulf states, together with China, Russia, Japan and France, have set in motion a plan to swap out of the dollar and into a basket of currencies comprised of the yen, the yuan, the euro, gold and a future common currency in the Gulf region.

"The Americans, who are aware the meetings have taken place -- although they have not discovered the details -- are sure to fight this international cabal which will include hitherto loyal allies Japan and the Gulf Arabs," wrote Fisk, who later postulated about a future "economic war between the U.S. and China over Middle East oil."

International cabals. Secret meetings. Economic war. Geez, this story contains more espionage than a shelf full of John LeCarre novels and a dozen James Bond movies. But is it true?

Apparently not, according to representatives from a number of countries cited by Fisk as conspirators. The report was denied on Tuesday by Qatar, Kuwait and Russia, and on Wednesday the French economy ministry labeled the report as "pure speculation."

"There is no basis behind these rumors," said the French ministry.

True or not, traders jumped on the story and refused to let go, bidding up the SPDR Gold ETF, as well as gold miners like Newmont Mining and Barrick Gold.

"Bankers remember, of course, what happened to the last Middle East oil producer to sell its oil in euros rather than dollars," writes Fisk about Iran's recent decision to switch its currency reserves to euros from dollars. "A few months after Saddam Hussein trumpeted his decision, the Americans and British invaded Iraq."

Sounds like Fisk has a plot for the sequel to Goldfinger. Even if the rest of the world isn't plotting anything.

Dumb-o-meter score: 95 -- Like 007's martini, the U.S. dollar is shaken as a result of this dumbness. And it is stirring up gold prices.



CBS' Stupid Network Tricks

Talk about stupid network tricks -- CBS (Stock Quote: CBS) spent last weekend removing unauthorized copies of David Letterman's extortion explanation from the Web.

In case you have been held in captivity somewhere and unable to access newspapers, television or the Internet, Letterman spent a remarkable 10 minutes last Thursday night telling his "Late Show" viewers about how he was victimized by a Connecticut man's alleged $2 million extortion attempt. The suspect, CBS News producer Robert Joel Halderman, threatened to expose sexual relationships the talk show host had with female employees. Halderman was arrested Thursday and released on bail Friday.

According to The New York Times, CBS did not post official copies of the blockbuster "Late Show" segment on CBS.com or on YouTube. Furthermore, the paper said that versions of the segment already uploaded to YouTube by users are being flagged by CBS for removal, citing copyright claims.

Come on guys! Is this some kind of "Late Show" prank? The cat is already out of the bag. The horses have left the barn. The toothpaste is out of the tube. All the CBS brass is doing now is suppressing its own video views.

Worldwide Pants, Letterman's production company, pressured CBS into taking action, according to Times, so it clearly shows who wears the pants in that dysfunctional family. And considering Letterman makes a pretty nice living joking about other celebs' marital indiscretions, the comic is certainly deserving of a good, swift kick in the pants in our view.

And this clip is undeniably video gold. Even without the clip of Thursday's show, the CBS channel on YouTube had a 25% spike in views in the three days following Letterman's announcement. Not one advertiser has backed off the show. And 5.7 million viewers tuned in to Letterman Monday night, more than double the audience for NBC's "Tonight" show with Conan O'Brien (which can't make NBC parent General Electric (Stock Quote: GE) happy, as it reportedly mulls selling a piece of the network to Comcast and media partner Vivendi).

People are going to find the video and watch it somehow, somewhere. Whether or not CBS wants us to. Letterman may want to keep the suppression of this video off his Top Ten List, but that won't stop it from making our Five Dumbest List.

Dumb-o-meter score: 90 -- Why is Worldwide Pants so afraid of the worldwide Web?

Nutrisystem Exec's Fat Wallet

Nutrisystem's (Stock Quote: NTRI) chief marketing officer got much fatter in the wallet this week, thanks to some very good timing over the company's deal with Wal-Mart (Stock Quote: WMT).

Shares of the weight loss products purveyor were made 16% plumper on Tuesday after the company said its 14-day starter program would be available beginning this week at more than 3,200 Wal-Mart stores. The deal with the nation's largest retailer marks the first time Nutrisystem goods have been available at retail stores. The program will cost $149 and includes 14 days of meals, access to weight-loss counseling, and Nutrisystem's online community. We here at the Five Dumbest Lab applaud Nutrisystem's push from selling meals via mail order to stocking Wal-Mart's shelves. In fact, we wish them so much success that they never need to run one of their omnipresent commercials again.

Nevertheless, as the accounting sleuths at Footnoted.org point out, one person at Nutrisystem is enjoying the pop in the stock more than anybody, including Hall of Fame quarterback turned shameless shill Dan Marino. Nutrisystem's Chief Marketing Officer Chris Terrill was granted 60,000 shares of restricted stock on Sept. 28, according to a regulatory filing by the company. The grant, which arrived just a week before the Wal-Mart deal was inked, priced the shares at $15.91, well below Tuesday's closing price of $17.46.

The shares vest over four years, so it's not as if Terrill can unload the shares immediately and make a quick killing. Still, the stock award more than doubles his holdings in the company. And considering he was only hired in June, it makes us wonder how much value he added in such a short time to earn that hefty reward.

Who knows, maybe the shares will go on a crash diet and Terrill's stock bonanza will end up as nothing but empty calories. But for now, the whole thing seems a tad curious to us.

Dumb-o-meter score: 85 -- If we see Dan Marino hawk one more meal we may sack the TV.

No Samba For Santander

Maybe Brazilians danced one too many Sambas after their big Olympics win, because the massive Banco Santander Brasil (Stock Quote" BSBR) sure had no spring in its first step as a public company.

Heavily hyped Santander Brazil fell 3% to $13.01 from its initial public offering price of $13.42 in its unveiling on the New York Stock Exchange, disappointing investors seeking an opening day pop in the stock. The bank's executives did not view its debut as dismal, however. In total, the IPO raised 14.1 billion reals, or $8.05 billion, for the company, making it the largest ever in Brazil and the biggest in the world since Visa went public in March 2008.

For the record, the pricing was around the midpoint of the expected range of 22 reals to 25 reals, or $12.37 to $14.06 per ADR, and was sold through a concurrent offering in Brazil and New York. Santander Brasil is the fourth company in the Banco Santander family to list on the NYSE, joining Banco Santander Chile, Banco Santander Bancorp and Banco Santander Spain.

It also joins Chinese online gaming giant Shanda Games as the latest oversized foreign IPO to dissatisfy investors. Two weeks ago, the Shanghai-based firm priced its $1.04 billion offering at $12.50 a share, the high end of its projected range, only to see it stumble and lose 14% on its first day of trading.

Some analysts say valuation doomed Santander Brazil before it even left the gate. The bank's price-to-earnings ratio of 17 was above the market average of 15.

We say, however, it's really payback for the emerging markets enjoying the spotlight a bit too much at the expense of the good old U.S.A. And we are not just talking about Rio de Janeiro stealing Chicago's Olympic Games.

Check out the opening day performance of insurance data specialist Verisk Analytics. The Jersey City, N.J., company raised a sizable $1.9 billion from selling 85.3 million shares at $22 each on Wednesday, the same day as Santander Brazil.

Verisk finished up 24%, compared to Santander's 3% stumble. Take that you emerging market upstarts.

Dumb-o-meter score: 80 -- Rio may have the Olympics, but Santander Brasil's IPO was knocked off the Wall Street's medal stand by Verisk.

ANA Wants You to Carry On Less

All Nippon Airways wants passengers to go before they go to Japan.

In a month long experiment which began last week, the Japanese airline is asking its passengers to take a quick trip to the bathroom prior to boarding in order to reduce weight, and therefore fuel consumption and carbon emissions. The carrier is testing the policy on 42 flights and hopes to achieve a five-ton reduction in carbon emissions. Here's how this bizarre plan breaks down as calculated by the Toronto Star:

"The average human bladder holds up to a liter of fluid, which weighs roughly one kilogram. All Nippon's most popular aircraft, a Boeing 777, holds 247 people. So, in theory, if 247 passengers all go to the washroom before boarding, they could lighten the plane by up to 247 kilograms -- the weight of three average men."

As far as we know, U.S.-based airlines like Delta, Continental, American and United have no similar plans to check passengers bladders before they check their bags. Nevertheless, it could be coming down the runway. Earlier this year, European budget airline Ryanair toyed with a plan to charge fliers for on-board toilet use.

We here at the Five Dumbest Lab say the airlines can take our in-flight meals away and charge us up the wazoo for pillows, blankets and extra bags. But let's leave it up to toilet-trained adults when they should use the loo.

Dumb-o-meter score: 75 -- The human body is about 60% water. What's another couple of ounces?


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