President Obama kicked off a six-day, four-nation trip overseas today. The original focus of the tour was nuclear security, but given developments in Russia and Ukraine, the President will use the trip as an opportunity to rally support for his response to Russian President Vladimir Putin. He'll do that today in a meeting with the G7 leaders arranged just days ago. Other highlights on the Presidential agenda include a meeting with Pope Francis and speaking with the leaders of Saudi Arabia in an attempt to smooth strained relations between the U.S. and the Middle Eastern kingdom.
In the corresponding video, Yahoo Finance Editor-in-Chief Aaron Task talks with Lauren Lyster about the financial implication of the Ukraine crisis. Task thinks investors should be paying more attention to the crisis. He said there could be, “massive economic implications, especially for Europe.” He cited Germany as being Russia’s biggest trading partner. “If the German economy were to falter, then whatever recovery there is in the E.U. goes away very quickly, and that...would have ramifications for U.S. markets.”
A top executive at JP Morgan (JPM) in China has resigned amid an investigation into hiring practices. Fang Fang, who had been with the bank for more than a decade, will step down as chief executive for China investment banking and vice chairman of investment banking in Asia. A reason wasn't given for his departure, but he is a key figure in a U.S. investigation into whether the bank hired the son of China Everbright Group's Chairman in order to win business from that company. Fang has not been accused of any wrongdoing.
One stock the Yahoo Finance team will be watching today is Apple (AAPL). The Wall Street Journal reports the company is in talks with Comcast (CMCSA), the nation's largest cable company, to provide streaming television service through set-top boxes that would bypass web congestion. The service would reportedly include live and on-demand programming, as well as videos stored in the cloud. Apple had reportedly been in talks with Time Warner Cable (TWC) for a set-top box of its own that would also bypass web congestion. In February, Comcast agreed to takeover Time Warner Cable.
We're also watching Coca-Cola (KO) after the CEO and founder of Wintergreen Advisers, David Winters, sent a letter to Coke's board and shareholders, and separate letter to Coke shareholder Warren Buffett, criticizing the company's compensation plans. Winters said the issuance of 340 million shares in compensation would be taking $13 billion from the company shareholders and giving it to executives. Winters said the plan "will significantly erode the per-share value of Coke shares." Warren Buffett is the largest shareholder of Coca-Cola stock with a 9.1% stake in the company. Wintergreen owns about 2.5 million shares of Coca-Cola and is also a large shareholder in Buffett's Berkshire Hathaway.
Yahoo's Aaron Task said Winters is doing a service by highlighting the issue of employee compensation, since there hasn’t been a lot of shareholder activism on this issue. “[Winters is] saying as a shareholder, ‘I’m basing my investments on what the current levels of both earnings and per share and if the share count explodes by 340 million because of this compensation, well that dilutes my ownership of the company.’” Task added, “He’s doing us a favor.”
Task said members of the “One Percent” are having the discussion about executive compensation, and noted that Warren Buffet has talked a lot about reigning it in. “We talk a lot about income inequality and transfers of wealth in this country,” said Task. “These are wealthy people saying, ‘Wait a minute, this corporation is taking wealth out of our pockets - out of the shareholders pockets.’”
Which brings us to today's poll question: "How do you think Coca-Cola's executive compensation plan will impact the stock and shareholders?" Vote in our poll and respond in the comments section below.