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Nike Inc beat quarterly profit expectations as deep cost cuts and lower taxes more than offset lower revenue in Key markets like the United States and China, sending its shares up 4.4%. The world’s top athletic shoe and apparel maker stressed it was gaining market share and stood to benefit when the global economy improved. But executives warned that retailers and consumers remained wary going into the pivotal holiday season, which accounts for the bulk of most retailers’ yearly sales. “People are still going to be relatively cautious going through that holiday period,” Nike Brand President Charlie Denson told analysts on a conference call, adding that Nike saw “sequential improvement” in retail orders through spring. Nike’s fiscal first-quarter net profit was US$513.0, or $1.04/shr, compared with US$510.5M, or $1.03/shr, a year earlier. Analysts, on average, had expected 97 cents per share, according to Reuters Estimates. Revenue fell 12% to US$4.8B from US$5.4B a year earlier, when orders in advance of the Beijing Olympics and the European soccer championships boosted sales.

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Crude Oil rose about US$1 toward US$74bbl to settle at a 10 month high Friday as data in the United States promised economic recovery and a revival in energy demand. US Crude for October delivery settled up 98 cents at US$73.89bbl, the highest settle since October 20. London Brent crude for October settled up 86 cents at US$74.19bbl Crude Oil gained US$6.38 on the week, about 10%, from the US$67.51 settle on August 14. The US$ was down against the Euro, helping to support commodity prices, with investors showing some appetite for risk.

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The USA’s trade deficit is collapsing at the fastest rate on record, a testament to the ability of a worldwide recession to sharply reduce global economic imbalances that had grown to unprecedented size. The United States estimated this week that the trade deficit, as a percent of GDP fell to 2.4% in Y 2009 Q-1, the smallest deficit in a decade. Declining trade deficits in the United States are likely to be matched by falling trade surpluses in countries that have historically been net exporters. That is one reason Germany’s economy appears to be slowing and China has embarked on a huge economic stimulus program of its own that appears to be working. The shrinking trade deficit is not being caused by a rebound in American exports. They are falling as well, but not nearly as much as imports are declining.

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Technology companies like Sybase (SY) and VeriSign (VRSN) are looking to tap robust growth in the nascent US mobile banking market as text message use rises and banks aggressively explore ways to save. Mobile banking services typically allow users to make payments, check balances, transfer money between accounts and generate statements of recent transactions on their handsets. In the deepening recession, mobile banking is seen as a cost saver for banks, as customers who use mobile banking make fewer calls to customer service.”The big banks are all moving aggressively,” said Steve Kietz, chief executive of Mobile Money Ventures, a joint venture between Citigroup Inc (C) and top South Korean mobile carrier SK Telecom (017670.KS). Text messaging, initially slow to catch on in the United States, has been getting more popular with Americans, especially younger ones.

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US investors are decamping foreign ventures and bringing their US$s home, entrusting them to the supposed bedrock safety of United States government bonds, and China continues to buy huge quantities of the USA’s debt. These actions are lifting the value of the US$, and providing the Obama administration with a crucial infusion of financing as it directs trillions of US$s toward rescuing banks and stimulating the economy, enabling the government to pay for these efforts without raising interest rates. The movement of this money back to the United States appears to be exacerbating the financial crisis world wide. A US$ invested by foreign central banks and investors in US government bonds is a US$ that is not available to Eastern European countries desperately seeking to refinance debt, also, it is a US$ that cannot reach Africa, where many countries are struggling with the loss of aid and foreign investment.

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Some of the large banks in the USA may require more aid to remain solvent, say some economists and other finance experts. This is a sobering commentary on the growing mountain of losses that can overwhelm the value of the banks’ assets.”The United States banking system is effectively insolvent,” it quoted Nouriel Roubini, a professor of economics at the Stern School of Business at New York University, as saying. He estimates that total losses on loans by USA financial firms and the fall in the market value of their assets will reach US$3.6T, up from his previous estimate of US$2T according to the New York Times last week.

U.S. Treasury Secretary Timothy Geithner unveiled a plan last week to soak up as much as US$1T in bad assets on banks’ books and expand a Federal Reserve program to support up to US$1Tin new loans. The market yawned and rolled over as experts said that in order for the US banks to resume the ample lending needed to restart the wheels of commerce, bigger, and more direct government role than in the Treasury Department’s plan called outlined. The government needs to really get in and close the weakest banks, inject capital into the surviving banks, and sell off the bad assets sooner rather then later.

Popularity: 7% [?]