HP’s Autonomy Deal Highlights Pattern Of Bad Ideas

English: Autonomy building at Cambridge Business Park. (Photo credit: Wikipedia)

By Michael Liedtke – It’s the latest in a cavalcade of costly blunders at HP. The Silicon Valley pioneer has squandered billions of dollars on ill-advised acquisitions, compounding the challenges it already faces as it scrambles to adjust to a world that is shifting away from PCs to smartphones and tablets.

Autonomy, which was based in Cambridge, England, had been known for a “dog-eat-dog” sales culture that drove employees to do whatever it took to hit their quarterly targets or risk incurring the wrath of CEO Mike Lynch, Pelz-Sharpe said. “It was never a happy company,” the analyst said. “It was always a place where people were frightened to speak out.” more> http://tinyurl.com/bctpog8

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The Sell Side Of Investment Banking Slowly Being Dismantled

By Kenneth Rapoza – Two hundred and fifty years ago, the company started out in the boring sugar trade, acting essentially as a middle man selling sugar from the source to the king of England. It survived stock market crashes and two World Wars. But it didn’t survive leverage and the European sovereign debt crisis. It’s one thing to buy bonds for $900 that end up being worth $700. It’s another thing to borrow 10 times the value of those bonds in order to buy them in the first place.

While Main Street investors with a home brokerage account can buy on 1.5x margin, often required to deposit at least 50% of the price of the asset, investment banks were easily 40 times leveraged, borrowing on top of assets based on another asset based on another asset until it all gets to a point like it did in 2008. more> http://is.gd/oG4tzi