| MARKET ROUNDUP |
Here’s a quick recap of the important news of the day …
|
 On the third day of this recent pullback, the market rested. The S&P 500 Index spent most of the day meandering before mounting a late rally, closing up 7 points, while bonds, gold, and currencies were largely “Unch.”Now let’s talk about giant slaying. When it comes to our television, Internet, wireless, and pay-per-view services, we’re the “Davids” in a world of “Goliaths.” And you know what’s worse? They’re only getting bigger!
Just over the past few days, we’ve learned that …
- AT&T (T, Weiss Rating: B) is very close to a deal to buy DirecTV (DTV, Weiss Rating: A-). The reported price? A whopping $50 billion, or somewhere in the $90-$95 per share range.
- Dish Network (DISH, Weiss Rating: D) was a natural potential partner for DirecTV. But it is reportedly unable or unwilling to match AT&T’s deep pocketed bid. That suggests Dish itself could jump into the fray by merging with or being acquired by someone else!
- Wireless providers Sprint (S, Weiss Rating: C-) and T-Mobile US (TMUS, Weiss Rating: C-) are also considering a $30 billion tie up. That will hinge on whether they feel they can get that kind of deal past regulators.
- And don’t forget that Comcast Corp. (CMCSA, Weiss Rating: B+) already announced a plan to buy Time Warner Cable (TWC, Weiss Rating: B+) for $45 billion in February. The transaction would create yet another hugely bulked-up cable company.
| “All told, an hour or so of work and some clever negotiating will save us around $90 a month. That’s HUNDREDS of dollars a year!” |
The implication for INVESTORS is clear: You can make money by investing in the shares of likely buyout targets — the “Goliaths” that keep getting bigger! DTV shares have risen more than 31 percent in the last year, while TMUS shares have surged 69 percent.
But what about all of us “Davids”? What can we do as CUSTOMERS to avoid getting run over? Well, let me tell you what I did a couple weeks ago.
I analyzed my family’s monthly budget in depth, and grew increasingly frustrated by how much we were paying just to call and text each other, gain access to the Internet, and watch TV. Just between our two cell phone plans (one of which is a family one covering three people), we were paying as much as we are on my car!
 |
| Have your wireless, Internet, cable, or satellite companies been willing to wheel and deal? |
So I decided to carve out some time and do something about it. I followed some advice I read online and went through my list of providers, calling them one by one. I talked about some of the deals their competitors were offering … made sure I got through to the cancellation department NOT the general customer service line by saying I was considering leaving … and asked what they could do for me.
It took maybe an hour or so overall. It required some patience and spending some time on hold. But you know what?
My satellite TV company agreed to throw in a couple months of free pay stations like HBO, and lop around $20 per month off my bill.
My cell phone provider gave me several months of free unlimited talk and text, and dropped my bill another $10. Changing my plan recently had already saved me another $10.
My Internet service provider is a different arm of the same company providing my cell phone service. It agreed to cut my monthly charge by $12 for a year, and gave me an additional $5 off per month for enrolling in combined billing with the cell phone division.
Finally, my wife got her cell phone company to cut each of the three phone access charges by $10 per month.
All told, an hour or so of work and some clever negotiating will save us around $90 a month. That’s HUNDREDS of dollars a year!
Bottom line: You can save money in this era of mega-mergers. You just have to be willing to pick up your sling, find a few rocks, and take aim at the Goliaths who are trying to stomp all over YOUR budget!
So have you tried something like this before? Have your wireless, Internet, cable, or satellite companies been willing to wheel and deal? Share your experiences and best money-saving tips at the blog
| OUR READERS SPEAK |
Speaking of saving money, even more of you weighed in on the food inflation front with valuable suggestions.
Reader Geraldina H. recommended eating organic because “it will be much healthier and you will have less to spend on doctors and pills.” Her other tip? “To make your groceries go further, add lots of vegetables to the pot.”
Reader Daniel J. suggested buying local as a way to cut costs. His advice: “I buy fresh organic fruits and vegetables at my local farmers’ market, which cuts out the middle-man to keep prices reasonable. I also do a few hours’ volunteer work every weekend at my local community farm; as a volunteer, I get to partake in the harvest of lettuce, kale, squash, tomatoes and other organic veggies. So to some extent, I work directly for my food.”
Great advice all around! With employers focused more on firing workers, cutting costs, and buying out competitors rather than doling out generous wages and raises, we owe it to our families to be better Davids.
|
 Housing starts surged a better-than-expected 13.2 percent to a seasonally adjusted annual rate of 1.07 million last month from 947,000 in March. Permit issuance also rose a healthy 8 percent to 1.08 million.
Two caveats: First, single-family activity was much weaker than multi-family. That suggests the boom in renting versus owning is causing companies to build more apartment complexes versus single-family homes. Second, the surge in construction is coming even as home buying sentiment and mortgage activity is slumping. Does that mean home builders are taking a page from the “Field of Dreams” script, saying “If you build it, they will come”?
Reminder: If you have any thoughts to share on these market events, all you have to do is hop on over to the blog and leave your comments.
Until next time,
Mike Larson
Mike Larson graduated from Boston University with a B.S. degree in Journalism and a B.A. degree in English in 1998, and went to work for Bankrate.com. There, he learned the mortgage and interest rates markets inside and out. Mike then joined Weiss Research in 2001. He is the editor of Safe Money Report. He is often quoted by the Washington Post, Reuters, Dow Jones Newswires, Orlando Sentinel, Palm Beach Post and Sun-Sentinel, and he has appeared on CNN, Bloomberg Television and CNBC.
