Hewlett Packard Fires Its CEO, Bank Debt Downgraded, European Banks Want to Sell Assets to Asian That Asian Don't Want . .

And Other Business News from the Wall Street Journal



Mr. Hewlett and Mr. Packard in
happier times



The once great technology company Hewlett Packard is  replacing its CEO.  Among other things the current CEO brought out an iPad competitor, then scrapped it, decided to make some more and sell them below costs.  The market reaction to the firing, the stock



was up more than 10% following news of Mr. Apotheker's potential ouster, 

Don't worry though, he will get a huge severance payment, American business being one of the few places where failure is richly rewarded, at least for CEO's.

Moody’s is downgrading the debt of major banks.  The reason

finishing a more than three-month review by saying it believes the U.S. government is less likely to support the banks if needed.

In Washington several politicians said they would approve any new bailout for banks, no questions asked, right after they committed an act of Japanese ritual suicide.

Europe is having a bank crisis, in case anyone noticed, and so the banks are travelling the globe to where the money is, in order to try and get some.  In case anyone doesn’t know where that is, or is not, it is not the United States and it is Asia.  It’s not going all that well.

Bankers at two European lenders said they were talking to banks headquartered in the Asia-Pacific region about selling them packages of loans, removing risky assets from their balance sheets. . .Bankers on one loan syndicate desk reported that French banks have tried to offload assets but are asking prices at or close to par, the nominal value of the debt.

 If buyers aren't willing to pay those prices, that would leave the the banks, which are likely to have the assets marked at near par on their balance sheets, with a difficult choice. If they sell them at lower prices they will have to write down the value of the assets, but if they hold them, they would be left with their funding problems.

Memo to European Banks:  The reason they have all that money is that they did not buy the assets that you are trying to sell them in the first place.

And getting back to HP, what do you do after you spend tens of millions of your own money in a losing campaign for Governor of California?  You celebrate your new found status as a management expert beyond pale and are hired immediately as the new head of Hewlett Packard.

in a conference call to reintroduce Ms. Whitman to Wall Street, analysts questioned her selection and the board's search process. H-P's chairman, Ray Lane, was asked whether the board was rushing to judgment, as critics say they did by hiring Mr. Apotheker last year after firing his predecessor.

So does HP get an exciting new strategy.  Well, no.

On Thursday, Ms. Whitman, 55 years old, said she endorsed the strategy put together by Mr. Apotheker. In addition to exploring a potential spinoff of its $40 billion-a-year PC business, H-P has agreed to pay $10.3 billion to buy U.K. software maker Autonomy Corp. and scrapped its TouchPad tablet computer, moves that had sparked concern from customers and investors alike.

"I think the strategy is right," Ms. Whitman said

So HP’s Board fired the CEO they just hired and replaced him with a failed gubernatorial candidate who is going to implement the strategy that the just fired CEO developed.  This explains a lot of the failure of HP in the past several years, doesn’t it.  If HP's Board is still looking for where the problem with HP is, somebody get them a full length mirror