Coldplay's Brilliant Web Marketing Strategy

I just got the following email from Coldplay. I am of the belief they are one of the first bands to truly master web marketing. Coldplay is encouraging their fans to download stems of their songs, remix them, upload their remixes onto their website, vote on the uploaded remixes and use a widget to share remixes on their blogs, websites etc. By doing this Coldplay is embracing the internet, embracing their fans and creating loyal followers who will want to support them in the future by attending concerts, buying apparel etc.

The only thing I would have done differently is give away the stems for free, but at only $5.94 and with lots of goodwill built up from their free album this isn't a bad way to monetize their brand.

To celebrate this week's single release (we still have those in England) Radiohead have broken up the song 'Nude' into pieces for you to remix.

For those of you who enjoy this sort of thing, you can buy the separate components or 'stems' (bass, voice, guitar, strings/FX and drums) and remix your own version of the song. You can do this by adding your own beats and instrumentation or just remixing the original parts. More information here: http://www.radioheadremix.com/information/

You can buy the stems here: http://www.radioheadremix.com/buy/You can upload your finished mixes here http://www.radioheadremix.com and be judged and even voted on by 'the public'.

You can also create a widget allowing votes from your own website, Facebook or MySpace page to be sent through too.

Hope you enjoy it

For those of you who aren't that way inclined, Nude is also available in its entirety on CD and 7 inch (UK release) at the usual retail outlets.

The only other really interesting business model in the music space is Live Nation. Live Nation is a billion dollar publicly traded company based in Beverly Hills that was a spinoff of Clear Channel. They produce and promote events, own venues and have recently begun signing major "bear hug" deals with artists like Madonna (10 year and $120 million) and U2 (12 year and est. $100 million) that enables them to profit from merch sales as well as digital and branding rights. Their stock prices is trading about 50% lower than the 52 week high but still looks expensive. Update: Live Nation announced they are in a final round of negotiations with Jay-Z on a $150 million deal.

Credit Crisis League Tables

Introducing the league tables that no one wants to be on the top of:

1) First the credit crisis "Writedown" league table:


All told there has been nearly a quarter of a billion dollars of write-downs and many are predicted this to rise to over $1 trillion over the next few years. Goldman Sachs is predicting $1.2 trillion.

2) Second the credit crisis "Capital Infusion" League Table:

Citi and UBS have been the most aggressive in raising capital and for good reason, they also have the largest losses. The only real shock here is that Merrill hasn't raised more cash.

3) Finally, this is the net effect of the writedowns and capital infusions for many of the large banks:
If this chart is any indication, Citigroup is in for another massive writedown. Some are predicting it will be in the $12-15 billion range, which compared to UBS's recent $19 billion writedown isn't all that shocking. This chart also hints that Merrill Lynch probably isn't done raising outside capital, look for them to take another chunk of money in the near future.

Data: Bloomberg

Jane Mendillo to Run Harvard's $34.9 Billion Endowment

Harvard Management Company today named Jane Mendillo, CIO to replace the departed Mohamed El-Erian:

After an extensive search, Harvard University has picked Jane Mendillo, chief investment officer for Wellesley College, to run the nation's largest college endowment.

Ms. Mendillo will take over July 1 as president and chief executive officer of Harvard Management Co., the company the runs the $35 billion endowment. She succeeds Mohamed El-Erian, who left last year to return to Pacific Investment Management Co. in Newport Beach, Calif.

During her five years at Wellesley, the school's endowment had an average annualized return of 13.5%, and grew to $1.7 billion from $1 billion. Prior to Wellesley, Ms. Mendillo worked for 15 years at Harvard Management, where she held a number of positions, including vice president of external management.

"Jane Mendillo has an excellent record as one of the most able and accomplished investment managers in the endowment world, as well as an extensive knowledge of the Harvard endowment and a deep commitment to higher education," said James F. Rothenberg, treasurer of Harvard University and chairman of the HMC board of directors.

Hat Tip: WSJ

Hilarious Bear Stearns Video from Jon Stewart

Wow.

Is Hillary Mathematically Eliminated?

The verdict is out, the superdelegates are the only way that Hillary Clinton can still win the Democratic Party's nomination. So, why is the media still portraying this as a neck and neck race? Politico.com may have the answer:

One big fact has largely been lost in the recent coverage of the Democratic presidential race: Hillary Rodham Clinton has virtually no chance of winning.

Her own campaign acknowledges there is no way that she will finish ahead in pledged delegates. That means the only way she wins is if Democratic superdelegates are ready to risk a backlash of historic proportions from the party’s most reliable constituency.

Unless Clinton is able to at least win the primary popular vote — which also would take nothing less than an electoral miracle — and use that achievement to pressure superdelegates, she has only one scenario for victory. An African-American opponent and his backers would be told that, even though he won the contest with voters, the prize is going to someone else.

People who think that scenario is even remotely likely are living on another planet.

As it happens, many people inside Clinton’s campaign live right here on Earth. One important Clinton adviser estimated to Politico privately that she has no more than a 10 percent chance of winning her race against Barack Obama, an appraisal that was echoed by other operatives.

In other words: The notion of the Democratic contest being a dramatic cliffhanger is a game of make-believe.

The real question is why so many people are playing. The answer has more to do with media psychology than with practical politics . . .

Please read on at Politico.com.

Meanwhile over at InTrade it appears that Obama's strength is truly evident, he has a 77.5%-23.3% advantage over Clinton:

Hat Tip: Intrade

Commodities Sag, but Why?

The punishment that financial markets have been doling out recently has finally hit the last bastion of strength: commodities. Most believe that the decline in everything from oil to corn to wheat is the result of investors raising cash:

Investors with losing trades in credit markets -- mortgage bonds or collateralized debt obligations, for example -- are being required by banks and others to set aside more cash to cover the money they borrowed to make trades, a process called "deleveraging." To raise the cash, some investors and hedge funds have sold some of their commodity winners.

"It's a classic deleveraging trade," says Bill O'Neill, a partner at investment-advisory firm Logic Advisors in Upper Saddle River, N.J. He says the unwinding of winning commodity trades has been playing out for most of this week, especially in the first half of the week.

Others give the victory to Bernanke:

Investors who had poured money into gold, oil and corn, seeking a hedge against inflation and a weak dollar, sold commodities to raise cash or buy stocks. The Reuters/Jefferies CRB Index of 19 commodities tumbled 8.3 percent this week, the most since at least 1956, after touching a record on Feb. 29.

``Bernanke took care of the commodity bubble,'' said Ron Goodis, the retail trading director at Equidex Brokerage Group Inc. in Closter, New Jersey. ``Commodities are coming back to earth. The stock market looks OK, and Bernanke is starting to look a little better.''

Concern that the central bank would let inflation get out of control eased after the Fed cut its key interest rate by 0.75 percentage point on March 18, less than the reduction of at least 1 point that investors had expected.

I think there is more to this than de-leveraging and investors respecting Bernanke's inflation-fighting prowess. I believe that investors are beginning to call into question the strength of global growth and sensing that it is simply not credible that India, China, Brazil and other engines of growth around the world will remain oasis' of prosperity when the world's largest economy (though technically smaller than the Euro-zone thanks to the weak dollar) experiences significant financial stress. Remember just 10 years ago Russia defaulted on billions of dollars of debt (remember LTCM) after the Asian crisis led to a global slowdown that pushed oil prices down to $11 a barrel and took away a major source of income for the Kremlin. Now oil prices are 10 times that on the back of one of the longest episodes of global growth on record. There is certainly plenty of room for commodity prices to fall further, especially if we start to see the slowdown in the US spreading more aggressively to the rest of the world.

Hat Tip: WSJ and Bloomberg

Fed Cuts by 75 bps to 2.25%

The Fed decided to cut the benchmark Federal Funds Rate 75 bps to 2.25%, not the full 1% that the market expected. I am marginally happy with this cut. I'm glad the Fed didn't do the full 1%. It sounds like they are trying to hold their ground on inflation and not seem too ready to debase the dollar and bail out Wall Street, but they also must realize that they are between a rock and a hard place.

Already the Dow is off over 100 points since the cut was announced, but is still up 200 points on the day. It will be an interesting 100 minutes to the close.

Hat Tip: CNBC Television

Fed Day

The Federal Open Market Committee (FOMC) meets again today for the first time since the end of January. But just because the FOMC hasn't had a formal sit down in 6 weeks doesn't mean the Federal Reserve hasn't been busy. On March 7th the Fed increased the Term Auction Facility (TAF) to $100 billion. On March 11th they announced a new $200 billion Term Securities Lending Facility (TSLF) designed to allow financial institutions to borrow from the Fed using MBS as collateral. Finally on Sunday the Fed agree to provide a $30 billion non-recourse 4 week loan to assist JPM's bailout of Bear Stearns. At the same time the Fed cut the discount rate by 25 basis points to 3.25% and announced a new Prime Dealer Credit Facility (PDCF) to provide overnight funding to prime dealers. All of these "Facilities" serve as extra support for the Fed's main policy action of lowering short term interest rates. They haven't been shy there either, cutting the Fed Funds rate 225 bps since September, including a 75 bps cut on January 22nd that was the largest rate cut in over 2 decades.

In the meantime since August 17, 2007 the dollar has fallen over 13%, the CRB commodity index has risen 32%, the S&P 500 is down nearly 10%, real interest rates are at or near negative and many are starting to realize that a recession may be better than debasing the dollar and stoking inflation even more. Yet, the Fed stands ready to cut the Fed Funds rate another 50-100 bps today.

I for one am worried that the Fed has effectively "run out of ammunition." This is the problem that Bill Gross ruminated about in his last market commentary, which I blogged about back on January 30th:

Because demand in the form of consumption has been artificially and fictitiously stimulated in recent years by financial engineering run amuck, there is a legitimate question as to whether its black hole imploding destructiveness can be totally countered with another dose of lower yields and deficit spending packages.

The economy is acting a bit like a drunken sailor, and unfortunately the Fed thinks the cure is another round of liquidity shots to which the sailor will most likely not respond well.

So what will the Fed do? We will know in 30 minutes and it is all up to these 10 lucky Fed governors:

Hat Tip: WSJ, Ritholtz, Rutledge