Econowatch: Bad news for Crocs stock

Good news

• American consumers felt more upbeat in December, the Conference Board said. Its consumer attitudes index rose to 78.1 from 72.0 in November. Must have been the spirit of Christmas.
• It wasn’t all that long ago people were openly predicting the end of the euro. But on Jan. 1 Latvia became the 18th country to adopt the currency, a sign the euro isn’t about to go away just yet.
• The IMF says central banks around the world have boosted their holdings of Canadian currency 23.5 per cent since the end of 2012, to US$112.5 billion. They like us, they really like us.
• Facebook founder Mark Zuckerberg donated nearly $1 billion of the company’s shares to charity in 2013, as the number of wealthy donors giving at least $1 million rose 57 per cent last year.
• Fiat signed a deal to buy the final chunk of Chrysler Group LLC it didn’t already own, a big win for Fiat’s Italian-Canadian CEO Sergio Marchionne and his plan to build the world’s seventh largest auto group.
• More than a dozen American states boosted their minimum wage on Jan. 1, with more to follow in 2014, a move economists expect will boost consumer spending.

Bad news

• Bombardier suffered a big setback with its rail division when it lost a $600-million contract to modernize the London Underground’s signalling system.
• Local government debt in China has surged since the end of 2010 by 67 per cent to roughly US$3 trillion. The loans went to fuel China’s infrastructure boom, but economists worried it could spark China’s own financial crisis.
• While the situation for America’s factories continues to improve, the pace of Canadian manufacturing activity slowed again, this time to a four-month low, according to RBC.
• The U.S. government warned that oil from the Bakken shale deposit in North Dakota, the type that exploded in the Lac-Mégantic train derailment, may be more flammable than other forms of crude. You don’t say.
• Another week, another customer relations crisis for Target Corp. Following revelations that customer credit cards were hacked, the company said some gift cards bought over Christmas don’t work.
• Hewlett-Packard raised the number of jobs it plans to cut in 2014 by 5,000, to a total of 34,000, as the shrinking computer company tries to restructure its business.

Stock Signs

• Crocs, the maker of chunky, brightly coloured foam clogs, has faced declining sales as consumers waffle over whether plastic shoes are a practical option or a screaming fashion disaster. The company has received a $200-million lifeline from the private equity firm Blackstone Group. There’s just no accounting for taste on Wall Street.
• BlackBerry ended its pitiful marketing gimmick—sorry, collaboration—with singer Alicia Keys, who was named “global creative director” last year. The move by CEO John Chen is a symbolic nod BlackBerry is sharpening its focus on the enterprise market.
• Since taking over Berkshire Hathaway in 1965, Warren Buffett has maintained an annual goal to increase the company’s net worth by more than the S&P 500 index over the previous five-year period. With the index, including dividends, up 128 per cent since 2008, analysts say it’s the first time Buffett has ever missed his mark.
• General Mills, one of the world’s largest food companies, has bet consumers will be drawn to Cheerios free of all genetically modified ingredients. The move is part of a larger trend by food makers ditching GMOs in the hopes it will pay off in higher sales.