Harold Maass of The Week The Best of Today's Business

Sprint Nextel loses money and subscribers

Sprint Nextel, the No. 3 U.S. wireless carrier, posted a worse-than-expected $505 million quarterly loss, as high-value monthly customers defected to other carriers. (Reuters) Sprint said it lost about a million customers in the quarter, about the same number as it lost all last year. (AP in Yahoo! Finance) AT&T picked up 1.3 million wireless customers last quarter, and Verizon Wireless brought on an extra 1.5 million. "Sprint has had a really bad reputation for customer service," said analyst Steve Clement at Pacific Crest Securities "They've struggled to figure out a way to market themselves, and I think they're still struggling." (Bloomberg)

HSBC profits despite bad loans

HSBC, Europe's largest bank by market value, said that it had a profitable first quarter, despite taking a $3.2 billion charge for bad loans in the U.S. and $2.6 billion in writedowns at its investment bank. The bad debt charge, tied to U.S. home loans, was smaller than expected. (MarketWatch) HSBC said it was increasingly probable the U.S. would enter a recession this year, but that strong growth in Asia, the Middle East, and Latin America made up for a decline in  U.S. earnings. "The U.S. provisions are less than some of the more aggressive forecasts," said analyst Simon Maughan at MF Global Securities in London, but "people need remember how strong Asia can be." (Bloomberg)

Cablevision scoops up Newsday

Tribune Co. agreed to sell its New York newspaper Newsday to Cablevision Systems for $650 million, after News Corp. dropped out of the bidding war over the weekend. The other remaining suitor, with a $580 million bid on the table, was Mortimer Zuckerman, who owns the New York Daily News. (Newsday) News Corp. already owns two area papers, The Wall Street Journal and the New York Post. (AP in Yahoo! Finance) Cablevision, controlled by the Dolan family, owns cable TV networks and several New York sports and entertainment properties. "We find it incredibly hard to believe the Cablevision board can find an acquisition of a local newspaper in shareholders' best interests," said Pali Capital analyst Richard Greenfield. (Bloomberg)

China's growing outsourcing problem

The cost of labor is rising in coastal China, and that is pushing Chinese textile and toy industrialists to Vietnam, India, and other areas with lower costs and access to ports, despite Chinese government subsidies to encourage the manufacturers to move to inland China. The shift isn't expected to affect the Chinese economic juggernaut, as coastal manufacturers switch to more valuable products like computer chips and electronics. But it is increasing the income disparity between the wealthy southeaster provinces and the poorer in land areas. "It is absolutely key that China push its development model westward," says Stephen Roach at Morgan Stanley inHong Kong. "The jury's out on whether they will pull it off." (Bloomberg)

BEST COLUMNS OF THE DAY

Fast growth, low return

Emerging markets are popular with investors because "faster economic growth means higher returns," says The Economist in an editorial. Only it doesn't. According to a London School of Economics study of 17 countries, the economies with the slowest GDP growth "returned 8 percent a year," while the fastest-growing ones returned only 5 percent. Other studies have found similar but wider disparities. "Why should this be?" In emerging markets, investors benefit if capital is reinvested in growing publicly traded companies, but many times it's put instead into "unquoted" firms or state-run companies. This isn't to "deny the importance of emerging economies." It's just to deny their greater profitability for investors.

401(k) follies and foibles

The world of the 401(k) plan "is far from ideal," says Andrea Coombs in MarketWatch, and a study of almost a million workers illustrates the risks many Americans take with their nest eggs. One of the big "red flags" is that a quarter of workers 60 and older held more than half of their retirement account in their company's stock. Investing primarily in just one company, or asset class, can have "dire consequences for retirement savers," including lower returns and higher risks. Many investors also don't take full advantage of matching retirement contributions, which is like turning down "free money." Workers in lower income brackets made more investing mistakes, the study found, but "they weren't alone."

GOOD DAY FOR: The next small thing, after Indian automaker Bajaj, France's Renault, and Japan's Nissan announced plans to jointly make a small car, starting at $2,500, for the Indian market. The car, code-named ULC, will go head to head with Tata Motors' $2,500 Nano model. "Bajaj is getting into this because there is a huge market opportunity here," said analyst Ashutosh Goel at Edelweiss Capital. (Bloomberg)

BAD DAY FOR: Liquid assets, after the storied Credit Municipal of Paris, the city-owned pawnshop dating back to 1777, started accepting bottles of wine. The Credit Municipal, commonly known as "auntie," accepts objects worth between about $93 and $3 million. (Los Angeles Times, free registration)

NOTED: U.S. Wal-Mart stores have started hosting Latin American fried-chicken chain Pollo Campero, in a move that gives the popular Guatemala-based chicken restaurant greater entry into the U.S. market and helps Wal-Mart appeal to the growing U.S. Hispanic population. The first Wal-Mart Pollo Campero, which translates to "country chicken," opened in Rowlett, Texas, but the world's largest retailer hopes to have more than 20 restaurants open in the U.S. by the end of 2009. (AP in Yahoo! Finance)

This column was written by Peter Weber of TheWeekDaily.com.