Intersecting Minds: Education, Business and Technology at the North Carolina State Jenkins Graduate School of Management

Week Starting with a Bang | January 26, 2009

The Street received a mix bag of news today. Stocks started the day strong on reports that pharmaceutical giant Pfizer is acquiring Wyeth in a $68b friendly takeover. Pfizer is the world’s largest drug manufacturer, and the addition of Wyeth will only strengthen that position. The merger will allow Pfizer to trim costs through plant closing and additional lay-offs.

The good news was tempered this morning though with three major corporations announcing another round of job cuts. Caterpillar made the largest announcement: 20,000 jobs. This was followed by Sprint and Home Depot, who said they would decrease their workforce by 8,000 and 7,000 jobs respectively.

In other news, Barack Obama announced that he was reversing an Environmental Protection Agency policy implemented by the Bush administration. The reversal would allow states to set their own fuel emission standards for vehicles. Thirteen states have such regulations on the books, but were not allowed to enforce their own rules under Bush. The move sets up an impending clash between labor and environmental groups. Labor, which has already faced a pounding from the negative economy, fears that such restrictions will further exacerbate manufacturing difficulties in the American auto sector. Environmentalists had been protesting the EPA restriction for years.



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