Blockbuster Closing, Atari Bankruptcy
Morning Business Memo….
Once they were two huge names in video entertainment. But today Blockbuster and Atari are shadows of their former selves. Dish Network says it plans to close another underperforming 300 Blockbuster stores it owns. That'll leave 500 US locations still open; some 3,000 employees will lose their jobs. Dish bought the bankrupt Blockbuster nearly two years ago. Blockbuster fell victim to competition from Internet streaming and other video services.
Video game maker Atari's US operations have filed for Chapter 11 bankruptcy protection in an effort to separate from their French parent company, which is filing a similar motion. In a statement, Atari says the move is necessary to secure investments it needs to grow in mobile and downloadable video games. Atari's American operations have shifted to focus on digital games and licensing, including developing mobile games.
It could make your boss angry but social media posts by employees are protected speech. Federal labor regulators have ruled that many employer restrictions on free speech are illegal. Workers are often discouraged from any public criticism of their company. But The New York Times reports that "in a series of recent rulings and advisories, labor regulators have declared many such blanket restrictions illegal. The National Labor Relations Board says workers have a right to discuss work conditions freely and without fear of retribution, whether the discussion takes place at the office or on Facebook."
Despite many grumbles from Wall Street, President Obama's first term was very good for most investors. Stock market averages rose more than 80 percent since the first inaugural to their highest in five years. But times are tough for savers in search of safe investments. The bond market is often seen as a safe haven. But returns are now very low and Greg McBride of Bankrate.com says that's part of a deliberate policy. "The Federal Reserve is the big player in financial markets right now." The Fed's huge bond buying program has "been driving investors into riskier assets whichhelped the stock market, but it's also I think increasing the risk of the bond market," says McBride. "Yields are so pitifully low that investors going into bonds under the guise of safety could get a very rude surprise when interest rates eventually do move higher."
A policy change by the Bank of Japan is the talk of global financial markets. The bank is joining the Fed in announcing a program of open-ended bond buying that's aimed at pumping money into the financial system and boosting the Japanese economy. Prime Minister Shinzo Abe pressured the Central Bank to announce a new stimulus.
Japanese and US investigators have started an inquiry into the maker of lithium ion batteries for the Boeing Dreamliner. All 787 jets that were in service have been grounded after an overheated battery led to an emergency landing of a plane in Japan last week.
Richard Davies Business Correspondent ABC NEWS Radio ABCNews.com twitter.com/daviesabc