Forex Investment

It’s just four minutes into an Apr. 4 episode of The Martha Stewart Show, and Donna Brock from Cleveland, Tex., is on the line asking for advice on how to clean her bathroom. Simple, Stewart says: “Disposable toilet scrubbers, from Scotch-Brite.” She plucks a scrubber wand from a box and goes to town on a toilet in the middle of the studio. Watching from home, Brock notes how easy the wand is to use under the bowl’s rim.

A segment about a disposable toilet brush might seem a trifle d?class? for Stewart, who built her aspirational brand on meticulously crafted decorations and gourmet meals. But there’s a backstory: 3M ( ), which owns the Scotch-Brite brand, helped develop and pay for the five-minute segment as part of a sweeping, multi-million dollar advertising deal.

Television has long worked products into dramatic story lines–and more so since advertisers began fleeing to the Web. Now such “brand integrations” are becoming common on daytime talk shows. Who better to sing the merits of a product than the beloved hosts of The Martha Stewart Show, The Ellen DeGeneres Show, or The View? To a greater or lesser degree, all are working product mentions into their shows in exchange for flat fees or a big ad buy.

But no one is pushing the envelope more energetically than Stewart. Yes, she is walking a fine line by calling herself “America’s most trusted guide to stylish living” while taking money to promote products. But she is breathtakingly candid about the practice and contends this is simply business as usual nowadays. “I like to inform people about good things,” she says. “And many of these products that are good things might not be known by a lot of people. So why not integrate them, and get paid for it?” As long as she sticks to promoting products she really believes in, Stewart argues, it won’t dilute her brand or abuse the trust of her 1.7 million viewers.

It’s not hard to see why Stewart & Co. love ad integrations. Because the show currently lags behind competing talk shows in the ratings, it can command only $10,000 on average for a traditional 30-second spot, vs. as much as $18,000 at The View or about $100,000 over at The Oprah Winfrey Show.

The hook for advertisers: Buy at least $250,000 worth of 30-second spots and get the chance to help create a branded segment on the show, not to mention work your messages into Martha’s other properties, such as her magazines or Sirius radio channel. Usually, such segments are free with large ad buys. When the airtime is sold out (which it has been since December for the 2006-07 season), the show will also sell branded segments ? la carte. For $100,000 you get “a short verbal and visual” of the product, says Liz Koman, senior vice-president for advertising sales at the broadcast unit of Martha Stewart Living Omnimedia Inc. ( ) (MSLO). A two-minute-plus segment that works in an advertiser’s talking points starts at $250,000.

Advertisers are understandably enthusiastic. Last year, nearly a fifth of episodes contained segments that were sponsored and shaped by major advertisers, including 3M, L’Or?al ( ), Kraft Foods ( ), and Georgia-Pacific. (The number probably would have been even higher had the show not imposed a cap on them.) “When you get an endorsement from someone like Martha Stewart, moms in our target take cues from her,” says Erik Sjogren, senior brand manager of Dixie, talking about a segment in which Martha recommended Dixie Cups as a way to keep kids healthy. “For us it was a slam dunk.”

It typically takes three weeks for advertisers and MSLO to put together a segment. A product may be used as an ingredient in a cooking segment, as the focus of a giveaway, or in response to viewer mail. After MSLO decides to include a product and determines how it will appear, it asks the client to supply two or three talking points.

Last fall, Hewlett-Packard Co. ( ) wanted Stewart to mention three things about its Photosmart R817 camera when it was featured in a segment on “How to take a picture.” HP wanted her to mention the name of the camera, how it differed from other models, and that it would be an ideal holiday gift. Stewart did HP one better: She covered all three points and also held up the user manual, according to Karen Cage, a marketer at HP. “Martha always overdelivers,” she says.

To reinforce the message, advertisers typically use their talking points in 30-second ads run directly after the product placement segments. On Mar. 15 the show ran a 2-minute, 40-second segment in which Stewart explored how Dixie cup styles have changed in the past 80 years. During the segment, she encouraged parents to “teach kids good hygiene by having a dispenser right in your kitchen.” As the segment ended, a Dixie logo appeared and a voice intoned: “This segment was brought to you by the maker of Dixie.” Then came a 30-second Dixie spot focused on hygiene-challenged plastic cups.

THE FIT MATTERS
How much the advertiser spends throughout the MSLO empire, which includes a Web site, radio station, TV show, and magazines, can affect what the company is willing to do. “One of the first things Martha will say to me is: ‘How much is it worth to the company? How important is it to the company?’” says Koman. “That’s important to us.” Even so, which products get used and how they’re worked into the show depends on “fit,” says Koman. “It needs to fit into themes like entertaining and housekeeping, in a way that informs our viewers.”

Some brands require workarounds to be consistent with what Stewart stands for. Consider an integration in the works for a butter substitute. Stewart loves butter, and she has long advocated that people eat smaller portions of rich foods rather than ample portions of a “diet” version. So Koman is considering having Dr. Brent Ridge, a health expert who loves the butter substitute, join Martha for a segment on healthy eating. He could acknowledge that Martha loves butter, Koman says, but also recommend the substitute for people with high cholesterol (she notes that the segment is still contingent on Stewart’s approval).

The Scotch-Brite toilet scrubber segment, which is part of the biggest multimedia deal MSLO has ever done, required similar adjustments. To do the segment, the production team sorted through viewer correspondence (Stewart receives about 1 million pieces a year) until they found a letter that fit the bill. After getting in touch with Donna Brock, they briefed her to speak concisely during the segment and to ask good lead-in questions about the scrubber.

But there was a problem: Stewart hadn’t used the scrubber before the segment was taped and wasn’t sure she actually would ever want to use it personally. “I could see it being used elsewhere, and it works very well,” says Stewart, “but it was disposable, and it’s kind of wasteful.” So Stewart decided to reconfigure the first part of the segment. She would start off by highly recommending a Scotch-Brite product she really did use and love, their trademark yellow sponge with the green abrasive backing. “Then I said: ‘This is the newest product from the Scotch-Brite people,’” and favorably compared some of its features to the sponge. “So that got it into the program very nicely.”

Some brands, meanwhile, are completely off-limits, Koman says. A diet pill company called LA Weight Loss, for instance, is one of the show’s biggest advertisers. Hard to square a diet pill with gourmet living.
READER COMMENTS

BEIJING (XFN-ASIA) - China’s monetary policy needs to be more transparent but it will take time to achieve it, central bank governor Zhou Xiaochuan said.

Speaking at a press conference during the annual session of the National People’s Congress (NPC), Zhou said a more transparent and predictable monetary policy is the ‘trend’.

But he added that investors should not use expectations of further monetary policy measures as an excuse to speculate in the stock market.

Juan.chen@xfn.com

For more information and to contact AFX: www.afxnews.com and www.afxpress.com

This column was originally published on RealMoney on Jan. 16 at 3:00 p.m. ET. It’s being republished as a bonus for TheStreet.com readers. For more information about subscribing to RealMoney, please click here.

There are people walking around the planet making the argument that the recent precipitous decline in the price of commodities (especially oil) portends a cyclical slowing in economic activity and rough seas ahead for the stock market.

It’s a sensible argument, if one believes the basic laws of supply and demand. But more important than whether it’s sensible, it strikes me as important to see whether the data offer reason to believe it’s true.

With that goal in mind, I plotted the Commodity Research Board Index, which represents a fairly broad basket of commodities, against the S&P 500 going back to 1991. That’s 15 years, and the extent of the data I have in my database.

There’s about a +0.28 correlation between the price panes of the SPX and the CRB Index over the past 15 years (where +1 is a perfect correlation and -1 is a perfectly inverse correlation).

Source: TheAgileTrader.com

However, that correlation may be significantly attributable to the general rising trend in inflation. With the consumer price index up roughly 40% since late ‘91, some of the price appreciation in both the SPX and CRB Index is owed to the higher cost of just about everything.

But remember, the question of the day is whether falling commodity prices will prove to be rough on the economy and the stock market in a cyclical time frame. On a year-to-year basis, the correlation between the price of the CRB Index and the SPX is -0.17. That is, in a yearly time frame there’s generally a modest tendency for the SPX to go up as the CRB Index is going down and for the SPX to go down as the CRB Index is going up.

The sensible thesis that rising commodity prices represent strong aggregate demand is slightly outweighed by the (slightly more) sensible thesis that falling commodity prices reduce businesses’ input prices and help profit margins, which is good for, well, most people — and the stock market.

But neither of these tendencies is very strong.

The strongest correlation I found in examining these charts is when the CRB Index is set ahead by 950 trading days, or just less than four years. (There are about 252 trading days per year.)

Source: TheAgileTrader.com

With the almost four-year offset, the correlation between the SPX and the CRB Index is a much stronger +0.60 over this period.

Is that meaningful or just coincidence? (Or is it what pioneering psychoanalyst Carl Jung would call a “meaningful coincidence?”) Perhaps there is some significance in the four-year offset. If so, however, the four-and-a-half-year upside run in commodities through mid-2006 would portend a continuation of the stock market’s rise until mid-2010.

This is not a definitive refutation of the “falling commodities are bad for stocks” thesis. I offer it not so much because it’s valuable on its own, but because an objective look at the history of the CRB Index does not support that thesis and indeed, if anything, shows a slight bias in the data to the contrary.

One more point on this subject: It might be possible to take the position that the great stock-market bubble of the late ’90s and the bursting of the bubble in 2000-02 goofed up the normally positive correlation between the SPX and the CRB Index — that the normal laws of supply and demand, when not distorted by bubblicious asset prices, usually should establish a positive correlation.

Maybe. But if so, then isn’t it just as likely that the 100% surge in the CRB Index from late ‘01 through the middle of ‘06 is a bubble that ultimately will burst, further distorting the “normal” positive correlation between the CRB Index and the SPX? (That is, what’s good for the stock-market bubble is good for the commodities bubble.)

You can’t have it both ways. If the stock market in the late ’90s was a bubble (and in retrospect it clearly was), then we have to acknowledge the distinct possibility that the commodities boom has likewise been a liquidity-driven bubble. And that bubble is just as susceptible to distorting normal correlations in financial markets, both now and in the years ahead.

If too much liquidity in the stock market can change the implications of low commodity prices, then too much liquidity in the commodities markets can also change the implications of high (and then falling) commodities prices.

Because of the weak and variable correlations between commodity prices and the stock market in even the simplest of terms, I don’t buy the theory that falling commodity prices imply trouble ahead for stocks. And I sure wouldn’t sell on it, either.

Next time I’ll look at what the Treasuries and Treasury inflation-protected securities markets have to say about just what the stock market is discounting in terms of economic growth and inflation.

A group led by the powerful Ontario Teachers’ Pension Plan has reached an agreement to buy Montreal-based communications giant BCE Inc., paving the way for the biggest corporate takeover in Canadian history.

The all-cash offer for Canada’s largest telecommunications company is valued at $57.1 billion or $42.75 a share, BCE said in a statement issued Saturday.

The winning bid was submitted by Teachers’ Private Capital the pension fund’s private investment arm along with Providence Partners Inc. and Madison Dearborn Partners, two private equity investment firms based in the United States.

The deal would add another huge asset to the pension fund, which is currently BCE’s largest shareholder with a 6.8 per cent stake.

Teachershas a 49-per-cent stake in Maple Leaf Sports and Entertainment, which owns the Toronto Maple Leafs, Toronto Raptors and the Air Canada Centre.

Aside from Bell Canada, BCE holdings include Telesat Canada, which operates satellite communications, and an interest in CTVglobemedia, the media company that owns the CTV television networkand the Globe and Mail newspaper.

Teachersproved victorious over two remaining bids from groups led by the Canada Pension Plan Investment Board and Cerberus Capital Management LP.

Telus Corp., Canada’s second-largest telecom company, dropped out of the bidding contest earlier in the week after complaining about the process. A Telus-BCE combination would have faced tough regulatory scrutiny as it would control most of Canada’s local phone service and about 60 per cent of the wireless market.

Shareholders urged to approve deal

The board of governors of BCE is recommending unanimously that shareholders accept the deal. The media giant said it expects the deal to close in the first quarter of next year.

The equity ownership would be as follows: Teachers’ Private Capital, 52 per cent; Providence, 32 per cent; Chicago-based Madison Dearborn, nine per cent; and other Canadian investors, seven per cent.

Michael Sabia, BCE’s president and CEO, said the going-private transaction “delivers to our shareholders the economic benefit of the work done to focus on our core business and to strengthen Bell with a new cost structure and new competitive capabilities.”

For consumers, the privatization of BCE likely won’t have much impact because the company will still be run by the same management team led by Sabia.

The Toronto-based Ontario Teachers’ Pension Plan,with assets of $106 billionin 2006,invests and administers the retirement funds for Ontario’s 167,000 teachers and 104,000 retired teachers.

Jim Leech, senior vice-president of Teachers’ Private Capital,said BCE’s headquarters will remain in Montreal.

BCE, which has more than 54,000 employees, had annual revenue of $17.7 billionin 2006. It has 18.2 million customer connections, including 5.8 million wireless subscribers, 8.64 million phone lines, 1.94 million internet subscribers and 1.82 million satellite television subscribers.

With files from the Canadian Press

If it really were the most important archaeological discovery in history, the point of truth came with very little song or dance. There was no drum roll or fanfare, just the sweeping aside of black felt drapes to reveal a pair of simple stone boxes sitting side by side.

But for the panel of film-makers, theologians and statisticians at New York’s public library yesterday, this really was the moment. As James Cameron, the director of the film Titanic who has lent his name to the project, said: “It doesn’t get bigger than this”.

The claim that was being presented to the world’s media and which will be aired on the Discovery Channel on Sunday was that the two boxes once contained the bones of Jesus of Nazareth and his wife Mary Magdalene. Another box, not present at yesterday’s event but coincidentally on display in Fort Lauderdale, Florida, contained, so the theory goes, the bones of their son, Judah.

The boxes, which housed human bones and are known as ossuaries, are made out of Jerusalem limestone with its distinctive colour of clotted cream. The smaller of the two bears the inscription Jesus, son of Joseph, while the larger and more lavishly decorated is marked in the name of Mariamene e Mara. According to the Canadian documentary-maker, Simcha Jacobovici, the inscription translates as Mary Magdalene the Master. It is his contention that he and his team of advisers have conclusively found the tomb of Jesus and his family.

“This is somewhat surreal,” Mr Jacobovici said as the drapes were pulled back. “To think that maybe under that felt are the ossuaries of Jesus of Nazareth and Mary Magdalene which lay together side by side for 2,000 years.”

The claim that Jesus was married to his disciple Mary Magdalene, that they had a child together in the style of the Da Vinci code, and that after his death he left behind his bones rather than being resurrected in the flesh elicited an outcry that was as instant as it was predictable. The American-based Catholic League dubbed the theory a “Titanic fraud”, saying that not a Lenten season goes by without some author or TV programme seeking to cast doubt on the divinity.

Amos Kloner, a top Israeli archaeologist who was one of the first to examine the ossuaries when they were discovered, said: “We have no scientific proof that this is indeed the tomb of Jesus and his family members”.

At the centre of the controversy is an undisputed fact: that 10 ossuaries dating from the first century were found in the Talpiot suburb of Jerusalem in 1980 by building workers. A common funeral practice at that time was to leave the bodies of the deceased to decay for up to a year until only their bones were left, then pack them in the stone boxes and entomb them.

Of the 10 ossuaries found, six had inscriptions bearing the names of Jesus, Mary Magdalene, another Mary who the film-makers deem to be Jesus’s mother, Matthew and Yose who they say were two of his four brothers, and son Judah. The existence of the boxes and the precise inscriptions they bore are matters of consensus, though how to interpret them certainly is not.

Mr Jacobovici, with the support the Oscar-winning Mr Cameron, who acted as executive producer, says the initial discovery of the ossuaries failed to excite much interest in 1980 because archaeologists were not armed at that time with the knowledge and scientific tools that now exist. His theory relies on the recent retranslation by experts of the Mariamene as Mary Magdalene.

The team carried out DNA sampling on matter remaining in the two boxes and claim it supports the contention that Jesus and Mary Magdalene were man and wife. And they turned to statistical advice from a professor in Toronto who concluded on the basis of the six names etched into the ossuaries that the possibility of this being the Jesus family tomb should be “taken very seriously indeed”, putting the probability that the tomb housed an entirely different family at 600-1.

But even as the felt was being pulled back yesterday, holes in the theory were becoming glaringly evident. The DNA available to investigators is very limited as the bones themselves have long since been reburied. The test carried out by the film-makers was mitochondrial - that is it only contained information on maternal inheritance, thus allowing the possibility that Jesus and Mariamene were brother and sister through the paternal line.

Israeli archaeologists were also quick to point out that despite the statistical work commissioned by Mr Jacobovici, the names scratched into the boxes were all highly popular and common in the first century.

“We know that Joseph, Jesus and Mariamene were all among the most common names of the period. To start with all these names being together in a single tomb and leap from there to say this is the tomb of Jesus is a little far-fetched, to put it politely,” said David Mevorah, a curator of the Israel museum in Jerusalem.

Professor Kloner told the Yedioth Ahronoth newspaper that the name Jesus had been found 71 times in burial caves at around that time.

The documentary, The Lost Tomb of Jesus, airs on the Discovery Channel on Sunday at 9pm.