Detetado primeiro caso de conflito de interesses no PRR

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WORLDCOM
Can Mike Save WorldCom?
Merging HP and Compaq was tough enough. Now Michael Capellas aims to salvage this poster child of the scandal era.
FORTUNE
Monday, December 9, 2002
By Stephanie N. Mehta

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• WorldCom's Latest Headache
• Where Does Capellas' Departure Leave HP?
• Bernie Ebbers' Foolish Faith
• In Corporate America It's Cleanup Time
• Capellas Makes His Case


As Michael Capellas steps onto the lawn of WorldCom's offices near Dallas for an all-hands meeting, you can feel the anticipation--and anxiety--of the crowd. Employees shade their eyes from the beaming mid-November sun and angle for better looks at the 48-year-old executive, just four days into his gig as CEO-elect of the bankrupt company. One worker nervously sidles up to a notebook-toting visitor. "Maybe we can get some positive press for a change," he says, jerking his thumb in Capellas's direction.

Within minutes Capellas has practically the entire audience grinning and nodding in agreement as he runs through brief remarks pledging to restore integrity and profitability to the fraud-plagued phone company. Then he takes questions--lots of them--and few are lobs. One person wants to know if more cuts are in the works (they are), another asks whether Capellas will sell the company's paging business (it's likely), and others are concerned about the fate of WorldCom's common stock. Capellas tells them that it's pretty much worthless right now. He peppers his responses with jokes and banter, which earn him laughs. But he gets the biggest rise when he simply promises to keep the employees informed of his still nascent plans to revive WorldCom. "I'm not going to tell you all the answers. We are going to be decisive and communicate with you," he says, drawing cheers and clapping. He holds his hands up in protest. "Hold the applause," he admonishes, "until we do it."

WorldCom's investors and customers are wisely following his advice. The long-distance giant still faces massive challenges--and the drama only seems to heighten daily. For starters, Capellas needs to file a reorganization plan for the largest bankruptcy in corporate history, at $107 billion in assets. He has to implement any settlement WorldCom negotiates with the Securities and Exchange Commission, which is investigating the company's $9 billion--so far--in accounting errors. He must raise morale, fend off competitors invigorated by WorldCom's weakened state, and learn to navigate the notoriously clubby world of telecom. As the former CEO of Compaq and, until Dec. 1, president of Hewlett-Packard, Capellas is a big shot in tech; here he's an outsider. Oh, and he must find a way for the roughly $28-billion-a-year WorldCom to make money, something his predecessors apparently achieved mainly through bookkeeping trickery.

Then there's Rudy. Just a few days after WorldCom announced Capellas's appointment as chairman and CEO, the press was full of reports that one of the company's largest bondholders, David Matlin of MatlinPatterson Asset Management, had a better candidate for chairman: former New York City mayor Rudy Giuliani. Yet Giuliani has said only that his firm aims to advise WorldCom on its restructuring; Matlin, who leads a group that has invested some $300 million so far, hasn't said a word. A source close to Matlin says he's interested in having a significant voice in WorldCom. It all adds up to more uncertainty--just what the company needs.

About the only solid ground at WorldCom right now is this: Capellas is committed to leading the resurrection. And he's making sure the company knows it. Though he doesn't take the helm until Dec. 2 and even by late November wasn't quite sure what he'd be getting paid, Capellas has gone straight to work. In the week after being tapped he made a six-city tour of WorldCom's offices--allowing Fortune to tag along. What we saw was a CEO who's short on specifics for a turn-around--Capellas isn't bashful about saying "I don't know" to questions--and long on tone setting. Not that that's bad; the formula is winning him support among workers. At a visit to employees in Ashburn, Va., he announced, "I won't ever lie to you," and earned an ovation. The reaction shocked him. "These employees have experienced one of the most untrustworthy acts in corporate history," he says privately. "We shouldn't have been surprised."

The trip took him from WorldCom headquarters in Clinton, Miss., to its facilities in Dallas, Colorado Springs, Denver, and San Francisco. The scene there is hectic. Employees cram into four conference rooms for question-and-answer sessions with the new CEO. Capellas strides into each office unannounced, wearing the same muted-gray sweater as the day before. Speaking with one particularly reticent group, Capellas himself asks the burning question: "So what's this I hear about Rudy Giuliani?" Relieved laughter fills the room. "There's nothing here I'm uncomfortable with," he says, repeating a message he'll deliver several times during his coffee talks. "If Mr. Giuliani would be interested in helping us with governance, I'll take all the help I can get."

On his own, Capellas is moving quickly. He's reassured dozens of major customers about the company's health and spent his first Saturdays as CEO-in-waiting answering 183 e-mail messages from WorldCom employees. In his chats with employees he pounces on questions about his resolve. "I'm here," he says firmly to an employee who quizzes him on his commitment.

The big question isn't about Capellas's drive but his abilities. Can he pull off the biggest business turnaround ever? Much of his success or failure will depend on factors out of his control, such as the performance of the economy and any additional WorldCom bombshells that still might hit. To fix what he knows is broken, Capellas is relying on his experience as a guide. And for now, exhausted employees say, they must simply choose to believe in their new leader.

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Iraq crop-sprayer base searched
Sunday, December 1, 2002 Posted: 6:19 AM EST (1119 GMT)



Inspectors are looking for evidence of weapons of mass destruction



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EXCLUSIVE: CNN's Christiane Amanpour talks to Chief U.N. weapons inspector Hans Blix.

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CNN's Rym Brahimi recaps day two of U.N. weapons inspections in Iraq (November 28)

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SPECIAL REPORT

• Resolution Text
• Interactive: Key questions
• Interactive: Surveillance photos
• TIME.com: What Iraq told Blix




RELATED
Gallery: Inspectors get down to work

• CNN Access: Hans Blix: 'There is a very strong power behind us'
• Q&A: Concerns of the Arab world
• Interactive: Iraq's suspected weapons of mass destruction




WHAT NEXT?
Deadlines for steps Iraq must take to be in full compliance with U.N. Security Council Resolution 1441:
December 8: Iraq must provide a "currently accurate, full and complete declaration" of any weapons of mass destruction program.
On or before January 27: Inspectors must report back to the Security Council.





BAGHDAD, Iraq -- U.N. arms teams are inspecting a military industrial site and an agricultural airbase with crop-spraying planes as their hunt for weapons of mass destruction enters its fourth day.

Four cars from a U.N. Monitoring, Verification and Inspection Commission (UNMOVIC) team arrived on Sunday at the agricultural facility, located in Khan Beni-Saad, 35 km (22 miles) north of Baghdad.

The inspectors went immediately into the site and the Iraqis then shut the gate. Helicopters can be seen at the site and there are said to be small planes there.

Planes at the air base are used to spray pesticides on crops. Tanker trucks are also at the site.

The United States said that in 1988, Iraq tested a biological warfare agent from modified aerial spraying systems from helicopters at the site.

William Patrick, a U.N. inspector who visited the site in the last round of inspections in the 1990s, said he saw then what he thought was the closest to a smoking gun of Iraq's weapons of mass destruction.

He said he thought he saw a modified crop-dusting nozzle on a helicopter at the site, indicating, he thought, that it could be used in a biological testing program.

On Sunday, a U.N. jeep has been posted at the entrance of the site to prevent anyone from entering or exiting, although journalists could see inspectors wear protective clothing.

UNMOVIC inspectors are focusing on chemical and biological weaponry.

While the inspectors were at the facility, at least dozen trucks carrying corn arrived at the facility. Those trucks are parked outside and can't unload while the inspections are going on.

The corn is dumped at the facility, dried and stored, and then it is taken to a factory, where it is processed into animal food. One of the truck drivers told CNN: "We'll wait here until morning if we have to."

Also waiting to get in to the facility is a tanker truck. It is not known what is in the truck but the vehicle is marked "flammable."

A team from the U.N. International Atomic Energy Agency (IAEA) went to a site 7 km northwest of Baghdad that is said to be a military industrial site.

That site had been listed in a U.S. document as a nuclear testing facility, where a gas centrifuge system had been used for enriching uranium.

IAEA is focusing its search on nuclear arms.

The teams left their headquarters about 8:20 a.m. to begin the fourth day of inspections. Both teams have received full access to the sites.

Inspectors also were anticipating the arrival on Sunday of the first of several helicopters to be used in their work.

Iraqi newspapers said Sunday that inspections so far prove that allegations by the British and American governments have been inaccurate and incorrect.

"No one in the world should be surprised if the evil-doers in Washington and London manufactured a new problem or crisis at any day," the official al-Thawra daily said.

"Even if the teams continue doing their work here no-one should rule out that the U.S. or Britain might try to create some kind of pretext for problems here," it said.

"But will the Bush administration and Blair government refrain from making allegations and claims? Will they refrain from creating problems? Will they stop from creating new pretexts?"

The newspaper also suggested spies could infiltrate the U.N. teams to create problems.

On Saturday, teams of inspectors searched three sites near Baghdad. Afterward, an Iraqi escort, Brigadier Karim Mohsen Alwan, told reporters the team had done their checking "and they found nothing."

U.N. inspectors had paid a surprise visit to the small Balad military base about 70 km (43 miles) north of Baghdad, where they searched for more than three hours.

He said the post housed a unit equipped to counter chemical attacks, raising the possibility that inspectors were looking for signs of reported large Iraqi imports of atropine -- a civilian medication that can be used to counter nerve agents employed as weapons of war.

The U.N. specialists were not expected to publicly discuss any findings at Balad, at least until after reporting to their headquarters in New York.

In a separate search Saturday, an IAEA team spent three hours at the Umm Al-Ma'areq military complex run by the Public Company of the Mother of All Battles in the Yusoufiyyah area some 15 km (10 miles) south of Baghdad.

The company, named after Iraq's term for the 1991 Gulf War over Kuwait, is an arm of the state's Military Industrialisation Commission in charge of developing weapons.

CNN's Nic Robertson said reporters saw the part of the plant where large water tanks were being manufactured and where high-precision tools were used. The director of the complex said the tools were monitored by the inspectors, who appeared to have taken metal samples from the plant.

Inspectors then went to a nearby site called Al Furat, a nuclear research site where Iraq was developing gas centrifuge enrichment for uranium.

U.S. President George W. Bush, in a speech about Iraq, pointed to the plant in a satellite photo. The arrows on the photo indicated recent work on the site which turned out to be an extension on the roof of the one of buildings.

The inspectors have returned to Iraq to search for chemical, biological and nuclear arms under a strongly worded U.N. Security Council resolution that gives Baghdad one last chance to dismantle weapons of mass destruction.

Washington accuses Iraq of developing weapons of mass destruction and has threatened military action to topple President Saddam Hussein. Iraq denies the charge.

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NEW YORK (CNN/Money) - The Nasdaq just closed out its third-best November ever in percentage gains. The Dow has closed higher for the last 8 weeks straight, its best run since early 1998. And investors are hoping the engine can keep running.

All three major indexes managed to pull off gains by the end of last week's holiday-shortened trading week. But those gains were during a time period that is traditionally stronger for the market, when volume is lower and news is sluggish.

This week is a full one, making an extension of the rally more challenging. While investors wait for the new spate of quarterly earnings reports to start flowing later in December, the main distractions in the next week will be some signs of the health of holiday retail sales, a few business updates from some influential tech issues and a big batch of economic data.

Known as "Black Friday," the Friday after Thanksgiving is traditionally one of the biggest shopping days of the year, kicking off the holiday shopping season, the most important period for retailers. Reports will begin surfacing this week about how the day went, along with other retail sales forecasts for the period.

Brokerage Merrill Lynch predicts that sales for Black Friday will probably turn out to have been pretty good, due to the particularly cold weather Friday and for the next four days, adding that strong sales should move retail stocks higher next week.

However, the firm still believes that the entire holiday shopping season will be fairly weak, showing only a 3 percent rise from the same period one year earlier.

Cisco, Intel updates
The recent stock market rally has been charged in large part by a recovery in some of the hardest-hit tech sectors. While the period of reporting quarterly reports is essentially in a lull, a few large-cap tech stocks will be offering market participants updated looks at how their business is performing this week.


On Monday, Cisco Systems (CSCO: up $0.09 to $14.92, Research, Estimates) is having an analyst day, where it is expected to give some updated guidance, while on Thursday Intel (INTC: down $0.02 to $20.88, Research, Estimates) gives its mid-quarter update. Chipmaker Genesis Microchip is also expected to give a mid-quarter update.

Intel stock has gained almost 21 percent this month. What the No. 1 chipmaker has to say about its revenue going forward will be particularly interesting in light of global semiconductor data released Friday. The semiconductor industry association said sales of computer chips worldwide rose 1.8 percent in October from the month before to $12.5 billion and were up 20 percent year-over-year.

"Visibility is important, even if the visibility is poor, because it shows you have a handle on the business," Charles Payne, chief analyst at Wall Street Strategies told CNNfn's Market Call. "The ability to give guidance is certainly something of a comfort."

Other key events this week
In a week heavy on economic reports, two stand out as the biggest potential market movers, the ISM report on manufacturing and the monthly unemployment figures.

Monday brings the Institute of Supply Management's November index on manufacturing activity. The index is expected to show an improved reading of 49.5, up from 48.5 the previous month, according to a consensus of economists surveyed by Briefing.com. Should the index rise, it would confirm the improvement in manufacturing suggested by the better-than-expected Chicago PMI index earlier this week. The Chicago PMI is a regional study of manufacturing activity.


The non-manufacturing version of the ISM survey, which looks at the services side of the economy, comes out Wednesday. The November reading is expected to be 53.2, virtually unchanged from a 53.1 reading the previous month.

Also on Monday, sales of auto and truck sales are expected to have held up in November, showing small improvements over the previous month, while monthly construction spending is expected to have shown a small decline.

But the big Kahuna is Friday's employment data. Weekly unemployment has been stabilizing of late, but some economists have speculated that that may be do to seasonal factors or other quirks. So investors will be looking to see if the monthly data supports the weekly.

"The catalyst right now continues to be the economic numbers," Michael Gurka, senior market strategist at Man Financial told CNNfn. "I think it's clearly gonna be the payroll numbers Friday -- the last one of the year. We were finagling with the 6 percent level for some time and now we've come off of that."

The unemployment rate for November is expected to show a slight rise to 5.8 percent from a 5.7 percent reading the previous month. Employers are expected to have added 13,000 new jobs, after a drop of 5,000 jobs the previous month.

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Data fit for a feast!

Stop worrying about deflation and enjoy the leftover turkey.
November 29, 2002: 4:06 PM EST
By Kathleen Hays, CNN/Money Contributing Columnist



NEW YORK (CNN/Money) - As we sat down Thursday to eat, drink, and, above all, give thanks for our personal and national blessings, some of us added one more item to the list: The latest numbers show the economy ain't no turkey.

From falling jobless claims to a super-strong reading on business activity from the Chicago Purchasing managers, it looks like we no longer have to worry about the economy falling as flat as the left-over whipping cream on top of the pumpkin pie.

Not only was the Chicago Purchasing Managers Index reading of 54.1 stronger than expected (and well above 50, the level which separates growth and contraction), it was driven by a big jump in the production index and in new orders.

And remember, just a few days ago we saw a much better-than-expected reading on mid-Atlantic manufacturing from the Philadelphia Federal Reserve Bank, aka, the Philly Fed survey. Now economists say this probably means the national manufacturing numbers from the Institute of Supply Management should show strength as well.

A big worry in the past few months has been declining industrial production. It's just hard to believe in a healthy economy and solid recovery while that's happening. But maybe the rebound in durable goods orders in October and these latest manufacturing numbers are signaling a reversal in that ominous trend.

The employment outlook in manufacturing is still pretty weak, but less so in the overall economy, at least when you look at the numbers on new claims for unemployment benefits. They fell to 364,000 last week, their lowest level since February 2001 -- one month before the recession began! Wow!

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But that is still a pretty hefty number of new weekly claimants, and probably helps explain why people still don't feel all that great about the economy. The rebounds in November Consumer Confidence and Consumer Sentiment were not resounding, and were based more on hopes for the future improving than a sense that conditions are getting better right now. And the ABC/Money Magazine weekly poll of Consumer Comfort weakened last week with people's view of the economy hitting a new cycle low. Again, people not feeling so great, not yet.

For a lot of workers and the companies that employ them there isn't much gravy out there in the economy right now. But at least the slippery downward spiral of deflation that haunts financial markets is starting to look like a threat as distant as the Federal Reserve portrays it. That's a big blessing.

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Can the markets end the year up?

The thought was laughable just a few months ago. But add December's track record to the rally...
November 29, 2002: 4:41 PM EST
By Paul R. La Monica, CNN/Money Staff Writer



NEW YORK (CNN/Money) - Will this be an up year for the market after all? The thought was laughable just a few months ago with the Dow, S&P and Nasdaq sitting on heavy year-to-date losses.

But now, the notion of a winning year for at least one of the three major market barometers is not as far-fetched. The Dow would need to rise 12.6 percent by year-end to break even. Investors shouldn't count on that happening, but it's not inconceivable.

It will be tougher for the S&P 500 -- it would have to gain 22.6 percent. And even though the Nasdaq has gained 33 percent since the market's Oct. 9 nadir, it still has to soar another 32 percent.

Even so, considering the momentum the market has, not to mention recent history, it looks like stocks have a decent chance of erasing more of their losses by year's end.

December generally has been a great month for stocks. The Dow and the S&P have had an up December for the past five years. (Maybe it's all the holiday cheer.)

And according to the Stock Trader's Almanac, this recent performance is not an anomaly. Since 1950, the S&P 500 has had an average gain of 1.8 percent in the final month of the year, making December the best month for the index. And it's the second-best month for the Nasdaq, with an average gain of 2.5 percent since 1971.

Festive times for all
Another thing that has been encouraging about this market rally is how broad it has been. As of Nov. 27, 454 of the stocks in the S&P 500 were up since Oct. 9. And 104 have gained more than 50 percent.


Granted, a large number of the biggest winners have been beaten-down shares of tech and telecom companies. But companies as diverse as J.P. Morgan Chase (JPM: Research, Estimates), Delta Air Lines (DAL: Research, Estimates), The Gap (GPS: Research, Estimates) and bubble wrap maker Sealed Air (SEE: Research, Estimates) all are up at least 60 percent since the market bottomed in October...hopefully for good.

And thanks to this huge market move, more than a quarter of the stocks in the S&P 500 are actually up for the year, including tech companies BMC Software (BMC: Research, Estimates), Lexmark (LXK: Research, Estimates), Intuit (INTU: Research, Estimates), Nextel (NXTL: Research, Estimates) and Yahoo! (YHOO: Research, Estimates)

Real rally or just traders having fun?
Now, whether or not this rally is a true sign of an economic and earnings turnaround or just a function of money managers trying to boost lagging fund returns remains to be seen.

There have been several hopeful economic signs lately. The job market is improving and consumer confidence was up in November. On the corporate side, durable goods orders increased in October. For more about the state of the economy, click here.

But there has been some concern that fundamentals haven't improved enough to justify such a gigantic swing in the market. Many tech companies have maintained that big businesses have yet to renew spending in a major way.

With this in mind, skeptics would argue that the main reason the market is up is that traders are covering short positions and that mutual fund managers are chasing momentum in order to try to boost their fourth-quarter results.

So if the market bucks historical trends and takes a tumble in December, then that could be a sign that institutional investors were just looking to make a quick buck...and that this is not the start of another bull market.

[MozHawk]

Um abraço,

MozHawk