We had Stuart Varney like we do always at the end of the show for Best Guess.  Stuart had mentioned in the past that China was hoarding crude and diesel, and that is why the demand picture had tightened.  I agreed with him. 

Today, he brought proof of his assumption:  since early June China has cut their imports of oil by a range of 5 to 7 percent.  For a world power like China that is an immense amount of oil, and he believes, and I agree, that China wanted to make sure nothing went wrong for their global debut.  Therefore, they imported more oil and diesel than normal, and hence, the oil spill we have seen last week and this week.

I believe crude should be at 100 or less.  I think I’m going to see that come true in the next two weeks.  My Best Guess is now in print, or online, or whatever.  I’m on the record. 

There will be groveling if I am wrong!

CC

Last week Bill Hemmer and Megyn Kelley had the 44 pound cat on their show, and I of course went down to meet the cat.  I had to see for myself how huge he was, and he is!  But, what I didn’t know is that he was dropped off at a New Jersey shelter by a woman who lost her home to foreclosure.

AND what I didn’t know is that shelters across the country are seeing a large increase in abandoned animals because of foreclosures.
Dr. Stephen Zawistowski from the ASPCA came in, you HAVE to watch this video.
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It is not a pretty picture around these parts, and we asked Adam Stillman, founder of Smith and Wollensky to come in and talk to us about his business.  Is the loss of jobs on the street hurting popular New York steakhouses?  Take a look:
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We had a senior director from Kelley Blue Book on the show Friday, and he gave us a peek at the cars behind him, and also talked about the most popular.  After the jump, the brands, the vehicles, and even a fuel sipper or two.  Happy browing…..

From Kelley Blue Book:

Here, presented in order of combined EPA-estimated fuel economy, is Kelley Blue Book’s 2008 list of the Top 10 Green Cars:

	2008 Toyota Prius | 46 mpg (48 city, 45 highway) Of all the vehicles sold in the U.S. by all the major manufacturers, none is more fuel-efficient than the Toyota Prius. Not surprisingly, the green-car poster child is also the best-selling hybrid on the market. With average fuel economy of 46 mpg, seating for five and options like a rearview camera and navigation, the Prius remains the “it” car for everyone from green-leaning celebrities to commuters just looking to save some green at the pump.
	2008 Honda Civic Hybrid | 42 mpg (40 city, 45 highway) Although the Civic Hybrid plays second fiddle to the Toyota Prius — and only the Toyota Prius — in terms of fuel economy, many buyers prefer the Civic’s more traditional sedan shape to the Prius’ “flashier” ovoid styling. Whether it pencils out financially compared with a gas-only Civic depends on a number of factors, but a Civic Hybrid owner will buy and burn around 30 percent less gasoline than his or her voltage-deficient counterpart.
	2008 smart fortwo | 36 mpg (33 city, 41 highway) Instead of horsepower and handling, it might be more useful these days to measure a vehicle’s “bang for the buck” in terms of its fuel economy. On that scale, the smart fortwo is without equal. The tiny two-seater delivers 41 highway miles per gallon for the low, low starting price of just over $12,000 (add about $2,000 for conveniences like a stereo, air conditioning and power windows). Starting around $17,000, the convertible version easily qualifies as the most fuel-efficient, lowest-priced drop top on the road today.
	2008 Nissan Altima Hybrid | 34 mpg (35 city, 33 highway) Using hybrid technology licensed from Toyota, the Nissan Altima Hybrid combines impressive fuel-economy with much of the same sporty character that has helped establish the Altima’s reputation as one of the most fun-to-drive mid-size sedans. The advanced technology isn’t confined to the engine bay, either, as the Altima Hybrid offers a slew of electronic and digital conveniences like push-button start, navigation with traffic info and a rearview camera.
	2008 MINI Cooper | 32 mpg (28 city, 37 highway) Cars that consume less fuel don’t necessarily have to sacrifice style or excitement. Need proof? You won’t find a more convincing argument than the lovable MINI Cooper. On the highway it can travel up to 37 miles on a single gallon. In the mountains, it demonstrates road-holding acumen on par with some much thirstier and pricier performance cars. Offering one of the most distinctive designs on the road to boot, the MINI Cooper is a smart choice for cost-cutting, fun-seeking and fashion-conscious buyers alike.
	2008 Ford Escape Hybrid | 32 mpg (34 city, 30 highway) Rising gas prices have been particularly troublesome for drivers who’ve grown accustomed to the raised seating position and added interior flexibility of SUVs. With the Ford Escape Hybrid, those so inclined can have their cake and haul it, too. The Escape Hybrid sweetens the sensible balance of a compact crossover with lower fuel costs and the amusement of all-electric operation in parking lots.
	2008 Honda Fit | 31 mpg (28 city, 34 highway) The littlest Honda isn’t the most fuel-efficient car in its class — a distinction that belongs to the Toyota Yaris — but it is the most versatile and most fun. An exceptionally flexible rear seat maximizes cargo- and people-hauling abilities, while an available Sport model offers a performance-tuned suspension and paddle shifters. Combined with a starting price of less than $15,000, the five-door Fit is a well-rounded economy car that’s good at everything from long commutes to long weekends.
	2008 Mercedes-Benz E320 BLUETEC | 26 mpg (23 city/32 hwy) “Mercedes diesel.” Can’t you just see, hear and smell it idling so obtrusively before you at the stoplight? Now, forget that ever happened and picture a smooth, quiet and clean E-Class diesel that returns 36-percent better combined fuel economy than its gasoline-swilling counterpart. Like many new diesels on the way, the E320 BLUETEC combines cleaner diesel fuel with new engine and emissions technologies to deliver all the punch and efficiency of a diesel powerplant, but without all the shake and soot.
	2008 Toyota Highlander Hybrid | 26 mpg (27 city, 25 highway) For families that demand the added capacity of three rows, the Highlander Hybrid is the most fuel-efficient option available. The gas-electric version of Toyota’s mid-size crossover SUV combines available seating for seven, impressive average fuel economy of 26 mpg and proven reliability. The standard equipment list even includes four-wheel drive, so you can commune with nature with the added peace of mind that you’re spewing less into the air.
	2008 Chevrolet Tahoe Hybrid | 21 mpg (21 city, 22 highway) Owners of full-size SUVs are suffering more than most at the pump, and many are trading the excess capacity for smaller, more fuel-efficient vehicles. But what of the large, active families that really do need all the size and towing ability of a large SUV? Now there’s a hybrid for them, too. The Chevrolet Tahoe Hybrid can be equipped with seating for eight, four-wheel drive and can tow over 8,000 pounds – all while seamlessly transitioning between gasoline and electric power and delivering 50-percent better city mileage than its gasoline-only counterpart.

She is one of the founders of Alice & Olivia, and she joined us today to talk about her new company and new line geared toward women in business. Take a look:

It’s in two parts, but her comments about Merrill in particular are worth your time.

CC

There are stories of potential buyers going to 8 banks trying to get financing to buy a home.  Conforming home loans are still being issued, but it’s jumbo loans that are the problem.  There are no investors left interested in backing jumbo loans, and Fannie and Freddie are not in that business.

Add to the storm the Federal Reserve who may very well have to hike interest rates later this year.  The Fed governors are getting more hawkish in their language and thanks to high food and energy costs, their hands may be tied.

So, higher interest rates, a hike in Treasuries, and tightened standards from lenders who are struggling to make money (and interest is a fee really) and you can see rates head higher by two full points.

Lock in that ARM folks, lock it in now.

CC

How ethically intelligent are you? Take the following quiz to find out.

1. One of the people you have just hired seems to be attracted to you, and you are attracted to this person. Both of you are single. Would you:

A) Ask the person out on a date.
B) Have only a professional relationship with the person.
C) Ask the person if your intuition is correct, and if it is, discreetly pursue a romantic relationship.

2. A co-worker in the next cubicle has a habit of spending a lot of making loud and distracting personal phone calls about things that are obviously trivial. Would you:

A) Ask the person to keep the volume at a reasonable level.
B) Focus on your own work.
C) Talk with the person about why it’s in everyone’s interest to limit personal phone calls.

3. In a public restaurant, you overhear two colleagues discussing confidential information about a client. They mention the client by name. Would you:

A) Ignore it.
B) Talk with your colleagues about your concerns about confidentiality and leave it at that.
C) Report them to your supervisor.

4. You recently fired someone who often came to work late, left early, and spent a lot of time surfing the Internet for fun while on the job. Recently you’ve learned that another member of your staff is doing the same thing. However, this person is the daughter of a close personal friend (who doesn’t work at the company). You have given this employee several warnings about her behavior, but the problems continue. Would you:

A) Fire the employee.
B) Give her another warning and hope that this will take care of the problem.
C) Ask your friend to talk with his daughter.

5. You took the family out to dinner and used your corporate credit card because you forgot your personal one. When it comes time to doing your expenses, you:

A) Put in the name of a client whose account you know has plenty of cash in it.

B): Mark it as a personal expense and reimburse your employer.
C) Tell your supervisor that it was a family dinner and ask him to approve the expense on the grounds that, with all of the late nights you’ve been putting in, you’ve missed a lot of meals with your spouse and children.

ANALYSIS
Evaluating the choices in each scenario is predicated on the five fundamental principles of ethics:

1. Do No Harm
2. Make Things Better
3. Respect Others
4. Be Fair and
5. Be Loving

ANSWERS
With the above analysis in mind, here is how each choice should be scored:
1. A = 1, B =3 , C = 2
2. A = 2, B = 1, C = 3
3. A = 1, B =3, C = 2
4. A = 3, B = 2, C = 1
5. A = 1, B =3, C = 2

IF YOU SCORED A TOTAL OF:
5-8: You tend to take the easy way out, or to consider your own needs and desires above those of others. It may natural to be selfish, but this doesn’t make it right.
9-13: Sometimes you take the high road, and sometimes you don’t. Yes, it’s sometimes difficult to find the courage to do what is right rather than what is convenient, but being ethical isn’t a part-time commitment. Since you acknowledge the importance of doing the right thing, why not strive to do it all the time, rather than some of the time?
14-15 You not only know what the right thing is; you consistently do it, even when it’s not so easy. Your friends, family, colleagues, and clients are fortunate that you’re a part of their lives. Way to go!

This quiz is intended to be a springboard for reflection and discussion about what it means to do the right thing. Also, my analysis should be subject to debate; I may be wrong. Nevertheless, the idea is that some responses to ethical problems are better than others, and the way we discover what those responses are is by turning to the principles of ethics.

Scenario #1
As tempting as they may be, office romances are not a good idea. For one thing, how can you be sure that your new hire is actually attracted to you and not just being friendly? Choice A may be based on a misinterpretation of the signals you’re getting (or think you’re getting), so asking the employee out on a date could reasonably be interpreted as sexual harassment. Even if there is a mutual attraction, however, choice C is still not the best response to the situation. After all, most relationships don’t work out, and when this one fizzles, you’ll both face an extremely uncomfortable working environment, and one or both of you may have to go. B is the best way to honor your responsibilities to your employee, your clients, your organization, and yourself.

Scenario #2
Making an excessive number of personal phone calls while on the job isn’t rude; it’s unethical. We’re paid to do a job, and wasting time is unfair to all; the fact that this may be a common practice doesn’t make it right. When a colleague engages in such conduct, it’s understandable that you’d want to avoid talking with him or her—few of us like confrontations—but this course of action (choice B) simply allows the problem to continue. Choice A goes further but doesn’t get at the root of the problem. The concern isn’t that the co-worker is yakking loudly but that he or she is spending so much time yakking. Lowering his or her voice may make life more bearable for you, but your colleague remains a time-waster. We’re all in this together, so respectfully bringing up your concerns with him or her, as difficult as this may be, addresses the issues of fairness and making things better. Choice C may be the hardest of the three to act upon, but ethically it’s the best solution.

Scenario #3
Your colleagues probably aren’t maliciously spreading gossip but just continuing a discussion they started before arriving at the restaurant. Their violation of client confidentiality is thus unintentional, but that still doesn’t make it right, and if you ignore the matter (choice A), you allow the problematic behavior to continue. Unless you work for an organization that requires you to report any confidentiality violations, choice C is too harsh and will also unnecessarily damage your relationship with your colleagues. Choice B honors all five ethical principles.
Scenario #4
Being fair means that we should treat like cases alike, and unalike cases unalike. The fact that an employee has a personal connection to you isn’t ethically relevant, regardless of how often this gets taken into account in business every day. Believing that the problem will go away on its own (choice B) is unrealistic, so continuing to cut the employee some slack isn’t appropriate. Also, favoritism hurts the morale of everyone else working in the department. Nor is it right to bring your friend into the drama (choice C). He has no place in dealing with internal company problems, and it’s irresponsible to have someone else do your job. Firing the errant employee (choice A) is the fair solution, regardless of any consequences to your friendship with her dad.

Scenario #5
It’s a privilege, not a right, to be treated to dinner on the company’s expense, and this is a call that only the company can make. It’s also a privilege to have a corporate credit card, and this privilege is based on the trust the company places in you not to abuse your expense account. Choice A is theft, plain and simple, no matter how flush with cash a client’s account may be. Choice C is honest and forthright, yes, but shouldn’t everyone who works overtime be treated to family meals? Imagine how your co-workers would react if they found out that you were able to get a perk that they did not, even though they too made sacrifices for the company. Choice B is both honest and fair, and for these reasons, it’s the best way to go.

By Bruce Weinstein, Ph.D.

This quiz appeared originally on BusinessWeek.com.

Of course, if you are a “trader” and not an investor than sure, this is your language.  But, I worry that short term trading is becoming a long term negative for the rest of us.  Did you read the Vanity Fair article about the collapse of Bear Stearns?  Here’s the link:

http://www.vanityfair.com/politics/features/2008/08/bear_stearns200808

I won’t comment on the role the competition may or may not have played in the Bear story, but the depth of the article and the background on the collapse of the investment bank is worth the read.

Goldman Sachs is being questioned on the Bear collapse, and the SEC is proposing new rules (which are actually old rules they are choosing to enforce) in the wake of the Bear debacle.  Is shorting a stock wrong? No, I don’t think it is.  Is selling the same position several times over a moral hazard? Perhaps it is.  I’ll let the lawyers figure this out, but I feel like the market has gotten layers away from the basis of what investing is supposed to be.  Finding good quality companies, and investing in their potential and future returns.  Certainly trading a derivative or a short or long position several times, creating a multi-layered instrument that is nothing more than a handshake by computer that does not equal true ownership is taking things too far.  What do you guys think?