This from Taipan Daily:

Let me check my list:

The Olympics? Nubile Chinese child-athletes took the lion’s share of the medals, but Baltimore hometown hero Mike “The Fish” Phelps stood on the top tier more often than any other human ever.

The Presidential election? A done deal back in November. Heck, in my neck of the woods, sulky Republicans were already sporting “Impeach Obama” bumper stickers as early as October.

The Inauguration? In-the-tank reporters gushed on every cable channel over how Obama knew the oath of office better than Justice Roberts. (Oh, like he hasn’t been practicing in front of a mirror since he was five.)

So what’s left to hyperbolize over? I guess it’s time to write about the Super Bowl.

Vegas Forecasts a Lousy 2010!

Not only does this annual gladiatorial contest give columnists like me an excuse to moralize ad nauseum regarding our national obsessions with fame, violence, pulchritude and beer, the Super Bowl supposedly offers up an astonishingly accurate leading indicator for the stock market.

The idea is that an NFC win indicates a bull market in the coming year, while an AFC victory forecasts a bear market. Scoff if you will, but aficionados of Bowl Apocrypha and barflies across the country brag of 80% accuracy.

Correlate this trend with Vegas’ book making machine, add in a tumbler of single malt scotch, and one might even be tempted to push one’s forecast out years or even decades. Currently the odds on the New England Patriots winning a year from now are 6-1, indicating a miserable Christmas come 2010.

Can’t you just hear your grizzled old statistics professor ranting about undersized data pools and how “correlation does not equal causation?” He’s most probably right, so let’s set aside the whole notion of “Winner-As-Stock-Market-Indicator.”

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The Beer Market Loses Its Fizz

Besides, the whole play-off structure pretty much guarantees that most of the country doesn’t give a fig who wins anyway, as their home team was most likely eliminated back in December. We all know that the real reason folks watch is the ads.

NBC Universal (PVT*) claims to have already sold some 85% of their available 30-second slots at some $3 million per ad. This actually beats last year’s $2.7 million price tag. That’s what they say anyway. I’d be curious to see how many of those ads were booked months ago by outfits that are now either dead or dying.

The two biggest categories of Bowl ads are cars and beer, a peculiar mix that would get one arrested on any other occasion. Beer is frequently described as “recession proof.” The folks in the corner suites at such outfits as SABMiller (LSE:SAB), Carlsberg A/S (Copenhagen:DCARLB) certainly wish that were true.

Unfortunately, this particular recession has taken the beery breeze out of even this sector’s sails. SABMiller reports a 1% drop in lager sales in the fourth quarter of 2008, while Carlsberg is cutting 274 jobs as a hedge against “uncertainty and risk”.

Will a flat beer market make for a dull Super Bowl? Those European folks at InBev NV/SA (PVT*) who bought up Anheuser Busch last year assure us that we will be treated to a veritable Clydesdales fest. The Bud Frogs? Not so much.

GM Goes MIA

There will be a few conspicuous absences this year. As I mentioned, car ads are the other major player. However, there is no way in hell you can describe folks like GM (NYSE:GM), Ford (NYSE:F) and Chrysler* as “recession proof” or even “recession resistant.” Sacrificial lambs would more apt. Or perhaps maybe “burnt offerings.”

Seeing as how GM is already making noises that it will need a great deal more government cash very, very soon if it is to survive till spring, it would seem somehow inappropriate for them to dole out their last few million on Super Bowl ads. Besides, the only ad they’ve got right about now brags as to how they only sell “manly” trucks, with none of the supposedly effeminate options Ford carries – for the same money.

So, GM will pass on the Bowl this year for the first time in decades. They are also skipping out on other high-profile, high-priced events like the Emmys and the Oscars.

On the one hand, this is probably a prudent thing to do. On the other hand, my experience as a business owner tells me that companies that stop advertising are pretty much screwed.

FedEx Is Absolutely Positively in Trouble

Another major player who will not be advertising during this Bowl year is FedEx (NYSE:FDX). After two-odd decades of pounding its “we deliver it yesterday” message, the shipper has announced “times have changed.” It is also cutting top exec pay and scotching contributions to the employee 401(k) fund.

Again, I note that while these are all prudent – perhaps even overdue – measures, they are also indicators of extreme distress. With this weakness in mind, both FedEx and GM are on my short list at WaveStrength Options Weekly. The former position is showing 55% gains already – with a strong possibility of doubling that in the near future – and the latter is ripe for entry as I sit to write.

*= Privately Held Companies

Source: Guess Who’s Skipping the Next Big Party?

“The good Lord was sold out for 30 pieces of silver. We were sold out for $70 a share.”

- Dave Liszewski, longtime Anheuser-Busch (BUD) employee

What to make of the Budweiser buyout, now that the Anheuser-Busch family has accepted Inbev’s sweetened $52 billion offer?

In St. Louis, the home of Bud since 1876, the reaction is deeply personal. There is great concern that the city’s health and well-being will be affected by the new owner’s cost-cutting. Plants could be shut down… jobs lost… local outreach programs and long-standing traditions gone.

Opal Henderson, a 78-year-old salvage yard owner, asks the question on many Arch City residents’ minds: “Why can’t those foreigners just stay at home and leave us what we have?”

Henderson channels the broader reaction of Bud drinkers everywhere. From a certain point of view, we are all from St. Louis on this. How could something so local, so basic, so fundamentally American, wind up in the hands of those frou-frou Europeans?

Older Than You Think

But from another point of view the ranting is overdone, and a bit hypocritical to boot. There is a certain irony in Bud going back to Europe, for example, because that’s where it came from in the first place.

The name “Budweiser,” known as Budweis to the Germans, goes all the way back to a little Czech town called Ceske Budovice. Beer has been brewed there for more than 740 years — ever since the middle ages — and has been casually referred to as Budweiser for most of that time. (In the Czech Republic, it’s normal practice for beer to be referred to by town or region of origin.)

So as you can see, the Budweiser name has a little bit of age to it. When the American version came into existence in 1876 — roughly six centuries after the Czechs got it going — the new brewers had the good sense to pay homage to the old. (Having studied in the Czech Republic in the mid-‘90s, I can furthermore assure you — eight centuries of practice have paid off. The Czechs truly know how to make the best beer in the world. For a poor college student, it tasted even better at 50 cents a glass.)

Just Business

I asked Sara Nunnally, our globetrotting foreign markets expert, what she thought of the deal from an international perspective. How does this thing look from Belgium (where Inbev, the acquirer, is based)?

“Well, you know, Justice,” Sara replied, “$52 billion just ain’t as much as it used to be. You’ve heard the news about the dollar hitting a record low against the euro, right? So that $52 billion is now only 32.5 billion euros. Just last year, this deal would have cost InBev 37.7 billion euros.”

Taking advantage of a strong euro made sense. But what else? I asked Sara why she thought Inbev wanted Anheuser-Busch so badly.

“My honest opinion?” she replied again. “InBev doesn’t care as much about Bud as it does about marketing its own signature beers here in the U.S. Not to mention the ‘back door’ into Asian markets with Anheuser-Busch’s stake in Chinese brewer Tsingtao. And even though InBev has already made inroads in Latin American markets, Busch’s stake in Grupo Modelo, makers of Corona and Modelo beers, certainly makes up a big part of those synergies the suits have been talking about.”

Ah, yes. So it’s all about profits and market expansion… using Bud’s massive U.S. distribution network to get more upscale European beers into the hands of pretentious American drinkers. And maybe about using the economies of scale that come from being the biggest brewer in the world. (A combined Anheuser/Inbev would take that crown; it currently rests with SABMiller in London.)

That all made perfect sense to me, being one of those pretentious upscale types myself. I’ll take a Pilsner Urquel or a Stella Artois over the rest of the pack any day. Not for the label, you see, but for the taste. (I’ll stop there before the pro-Bud hate mail starts rolling in…)

Will Emerging Markets Topple the King of Beers?

By Irwin Greenstein

Budweiser (NYSE:BUD) and Busch are as American as camo seat covers in a F-150.

Yet a hostile offer by InBev SA (PINK:INBVF) on Anheuser-Busch is about to show us that the star-spangled King of Beers is up for play because it ignored emerging markets.

When you look at the dynamics behind the InBev (EBR:INB) bid, it’s important to see America as a diminished player. The headlines tell you that the economy is dismal. What Big Media rarely tells you is that smaller, developing economies are kicking our butt. American companies that count strictly on the U.S. for revenues are destined for the rustbelt of the future — or a foreign buyout.

Analysts have been badgering A-B for years that it relies too heavily on the U.S. — one of the slowest growing beer markets in the world. A-B has buried its head in the sand as InBev and other competitors have pushed into high-growth emerging markets.

While A-B claims nearly 50% the U.S. market, the company registers as a mere blip in Argentina, Brazil, Russia and Eastern Europe, which are In-Bev strongholds. The worldwide market-share numbers tell the story loud and clear…

InBev 16%
SAB Miller (LON:SAB) 12%
Anheuser Busch 9%

You would think that A-B is willing to look beyond the lower 48 simply based on the performance of beers it imports from InBev. A-B grew its volume last year by 2.9% from the previous year thanks to a successful U.S. distribution partnership that gave it InBev’s Stella Artois, Beck’s and Bass premium beers.

Of course, most American’s believe they’re carrying the day for A-B by buying 12-packs of Bud, Busch and Miller Lite. In its marketing campaigns, A-B gives credit to the Nascar and slacker crowd for its crowning achievement as the King of Beers.

A-B’s Yankee Doodle marketing trumpet has deluded many Americans into believing that the company is entitled to its success because it’s an American icon. It’s the same patriotic hogwash that we heard about the Big Three auto makers — a case study that clearly proves denial is not an a business strategy.

When the In-Bev bid became public, the governor of Missouri declared he would explore all options to keep the company in St.Louis: “I am strongly opposed to the sale of Anheuser-Busch and today’s offer to purchase the company is deeply troubling to me.”

Maybe A-B’s hometown of St. Louis is afraid of becoming the next Detroit.

Or maybe America is afraid of becoming the next France…

A “save Budweiser” petition has already attracted more than 32,000 signatures on the Internet. The site even has an anthem titled “Kiss My Glass, InBev” The Save Budweiser rallying cry is “Let’s band together as one voice and try to save more than just our beer. We don’t want another American icon turned over to a foreign company; we want the motto to remain…The Great American Lager.”

You have to wonder how many of these cowboys and cowgirls are A-B shareholders. The company’s stock price has grown less than 3% in the last year. Factor in inflation, and your A-B stock won’t even pay to fill up that F-150.

A-B’s American sense of entitlement is backfiring at the worst possible time for the company. A-B owns 50.2% of Modello, the Mexican brewer behind Corona and other major brands. The partnership took a nasty turn last month when Grupo Modelo Chief Executive Carlos Fernandez resigned from A-B’s board of directors after a 15-year clash between the Busch and Fernandez dynasties.

Fernandez could’ve been a key ally in fending off InBev. Now there’s speculation that Modelo could sell its half to InBev — potentially crippling A-B’s presence in a lucrative emerging market.

InBev is already big in Latin America. It was formed from the merger of Belgium’s Interbrew and Brazil’s AmBev in 2004. Add Modelo into the mix and A-B wouldn’t stand a chance south of the border.

Compared with A-B, InBev is a true multinational. From its headquarters in Leuven, Belgium, it sells more beer than any other company. Its operations encompass more than 130 countries. About 60% of its profits come from Latin America, giving it crucial experience in emerging markets.

While InBev savors 12% of the Chinese beer market, A-B may have wasted precious time setting up shop in what some experts say is the world’s biggest beer market.

A-B had acquired Harbin, China’s fourth-largest brewer at the time in 2004. Now Harbin has dropped to fifth place.

It may have bungled another China opportunity as well. A-B formed a strategic alliance in China with Tsingtao in 2002. Under the terms of the deal, A-B took a 27% interest in Tsingtao. At the time, Tsingtao held a 13% share. Five years later, Tsingtao reaches 14% of the market, according to Reuters. One percent in five years?

In March 2007, A-B finally got around to announcing it was expanding Chinese distribution. Yeah, sure, OK…

In the end, both A-B and InBev aren’t doing too well these days. Profit margins are squeezed by rising prices of aluminum and grains. But this story is about bigger things than a stock recommendation.

We are witnessing the decline of America’s economic might. InBev’s attempted U.S. invasion is just a harbinger of things to come.

American investors can’t ignore that companies focusing on emerging markets will land on our shores with boatloads of money ready to buy our cherished industrial-age icons of commerce. So instead giving you a stock pick, my investment advice to you is: Get used to it.

Emerging markets are leaving the shadow of the slouching American giant. Once you accept that, you’ll see the profit potential of emerging markets in a whole new light.

Source: Will Emerging Markets Topple the King of Beers?