The economy expanded a slower pace in the fourth quarter, as economists expected. Gross Domestic Product grew 2.4%, down from an initial reading of 3.2%. Yesterday, Federal Reserve Chair Janet Yellen told the Senate Banking Committee weather might be to blame for recent signs of weakness in the economy, but she is not sure yet just how much of an impact the weather has had. So the Fed's plans to pull back on bond buying by $10 billion a month will remain in place for now, according to Yellen.
Even as Yellen says winter storms could be to blame for economic weakness, there is yet another winter storm bearing down on much of the country. This one could affect 100 million people. The snow is expected to begin tonight in the northern plains, travel across the Midwest over the weekend and dump some of the heaviest snow, perhaps more than a foot, in the Northeast on Monday. This storm is expected to impact roads and air travel, which means businesses are likely be affected once again.
Among early stock movers: Mattel (MAT). The company announced this morning it will buy Canadian toy company Mega Brands for $460 million dollars. Mega is the maker of Mega Bloks, the number-two construction-toy maker behind Lego. The deal comes after Mattel reported disappointing fourth quarter results based on a slow holiday season for toys with Barbie sales slumping 13%. Mattel stock is down more than 20% year-to-date.
Who knew there was so much drama in men's clothing? Shares of Jos. A. Bank (JOSB) and Men’s Wearhouse (MW) were higher in pre-market trading. The standoff between Jos. A. Bank and Men's Wearhouse continues, but there may be signs of progress. Jos. A. Bank's board rejected the latest $1.8 billion takeover bid from Men's Wearhouse, but the board also said it was willing to meet to discuss a price the two companies could agree on. This is the latest in a months-long back-and-forth as the two companies try to buy each other.
And Bitcoin exchange, Mt. Gox, today said it was filing for bankruptcy protection after losing nearly half a billion dollars worth of bitcoins. Earlier this week, Mt. Gox, took down its website and halted transactions. The Mt. Gox failure raises questions about regulation of bitcoins and protections for its customers. Yesterday in her testimony on Capitol Hill, Yellen said that the Federal Reserve doesn’t have the authority to regulate Bitcoin.
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