Here’s what’s important in the financial world this morning:
China’s Purchasing Managers Index, Slowing Economy: The country’s PMI was below 50 again in December. A PMI above 50 is considered a mark of expansion. The China Purchasing Managers’ Index for this month was 48.7. In November, it was slightly worse at 47.7. Now, the People’s Republic must balance making money easier to borrow with whether that easing becomes the cause of inflation. The availability of money may not solve the problem at all; it may just delay the effects of poor PMI. No amount of capital can offset a sharp drop in demand for China goods in the U.S. and EU.
Can’t trade AMR on NYSE: The ability of investors to trade share of AMR, the bankrupt parent of American Air, on the NYSE will disappear. That adds insult to injury. American is one of oldest carriers in the U.S. Unlike many of its competitors, it has not gone through serial Chapter 11 filings to remain viable.
Verizon’s 4G Woes: The problems of Verizon Wireless, which include the third collapse of its 4G network in as many weeks have not ended. The firm made the following announcement:
Verizon Wireless offers customers numerous free and simple payment options and we encourage customers to use those options. Starting January 15, a new $2 payment convenience fee will be instituted for customers who make single bill payments online or by telephone.
The news caused a revolt among Verizon Wireless subscribers. Verizon said it needs to make the charge to offset transaction expenses. Secretly, the fee may also help the carrier make up for the revenue it loses as subscribers flee is crumbling network.
Google+ vs. Facebook: The threat of the Google+ social network product to Facebook appears more real with each passing day. Social network expert Paul Allen says Google has 62 million “plus” users now. He forecasts that the figure will reach 400 million by the end of 2012. Facebook has about 750 million members. What Allen does not address is whether people actually spend any time on Google+. Most research shows that social network “time spent” favors Facebook by a wide margin