Twitter Buyout Hoax Sends Shares Up; Colorado’s Schools Getting Built on Pot; June Consumer Spending Blues

Nothing to get all tweeted up about…

Image courtesy of  winnond/FreeDigitalPhotos.net

Image courtesy of winnond/FreeDigitalPhotos.net

It’s the big news that wasn’t. A story about a $31 billion Twitter buyout made its way online on a website that looked suspiciously like it came straight out of Bloomberg headquarters. Except that it didn’t. A Bloomberg spokesperson said that the story was “fake and appeared on a bogus website that was not affiliated with Bloomberg.”In fact, the website was created just a few days ago, was rife with typos and referred to Twitter’s former CEO Dick Costolo as “Richard ‘Dick’ Costello.”  Talk about rookie mistakes. It’s too bad the story was false as the news caused shares of Twitter to spike more than 8%. I guess this means Wall Street digs the idea of a Twitter buyout. It’s not the first time a bogus story caused a stock to artificially inflate. Avon Products had a similar situation months back when a company calling itself PTG Capital Partners filed a bid to buy the company for $8 billion. Now, Avon’s great and all but that price seemed a bit too high for a company that hadn’t had a good quarter in too long of a time. This, of course, raised some red flags and now the perp behind the phony filing is facing the legal wrath of the SEC.

High-er education…

Image courtesy of Paul/FreeDigitalPhotos.net

Image courtesy of Paul/FreeDigitalPhotos.net

Ever since Colorado decided to legalize recreational marijuana, schools in the Rocky Mountain State have been emerging victorious. A special fund from marijuana sales, set aside for Colorado schools, has been setting records thanks to a 15% excise tax. In 2014, $13.3 million in pot taxes for school construction was raised. But in just the first five months of 2015, that fund already surpassed $13.7 million. Part of the reason for the huge price increase is because marijuana businesses received a one time tax exempt transfer of medical plants. But it also helps that there are three different taxes imposed on marijuana, including a 2.9% sales tax, a 10% special marijuana sales tax and a 15% excise tax on wholesale marijuana transfers. Unfortunately, pot still has its haters and those opponents are coming out in full force using a racketeering law – that was initially established to bring down organized crime – by suing not just pot businesses, but their banks, their bond companies and even their accountants. Now if only there was a way for marijuana businesses to sue the pot opponents and level the playing field.

June gloom…

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Image courtesy of David Castillo Dominici/FreeDigitalPhotos.net

Well it looks like the Fed won’t be rushing to hike rates anytime soon all thanks to the Commerce Department’s latest report for June. In case you missed it, consumer retail sales were pretty depressing. The numbers were weak and that is a problem since consumer spending accounts for 70% of the economy, suggesting that the economy isn’t growing as it should. Sales of automobiles and other goods took quite the hit as would-be spenders are playing it cautiously about spending their hard-earned cash lest they need it for a rainy day. The fiscal crisis of 2008 is still managing to spook a lot of people even though hiring is pretty decent and the labor market is fairly healthy. To be fair, though, wages are kind of flat and everyone would appreciate a little rise on that front. Even the revised growth rate for May was disappointing coming in at 1.0% as opposed to the 1.2% that was first reported. Here’s hoping July brings better fiscal news.

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