Does Alpha-Beta Spell `The End' for Mutual Funds? Mutual funds may soon be obsolete...a commentary by Chet Currier on Bloomberg. That's a strange argument to make in the very year that U.S. assets of the funds, one of the most popular and successful products in the history of investing, reached $10 trillion. The total is 10 times what it was at the start of the 1990s, less than two decades ago. And growth lately has been even faster in other parts of the world. Worldwide fund assets verge on $20 trillion, according to the Investment Company Institute. 

Goldman's Blankfein Is Eligible for $87 Million Bonus After Record Profit 
Blankfein can get more because a compensation plan approved by shareholders earlier this year allows the firm to pay as much as 0.6 percent of pretax earnings to each of its 25 top executives. That works out to $87.4 million apiece, based on Goldman's $14.6 billion of profit before tax. Shareholders also eliminated a $35 million cap on bonuses paid in cash and stock. (Bloomberg)

Stock Strategists Alarm Investors With Unanimous Call for 2007 U.S. Rally 
Strategists at 12 of the biggest Wall Street firms agree that U.S. stocks will rally next year. The last year that happened was for 2001, when the Standard & Poor's 500 Index dropped 13 percent. (Bloomberg)

Optimism on Equities Remains at Eight-Month High, Merrill Survey Shows 
Merrill's poll of 210 fund managers, who together manage $713 billion, was conducted between Dec. 8 and Dec. 14. A net 53 percent of respondents expect the world economy to weaken in the next 12 months. A greater majority, 83 percent, believe a recession is unlikely. A net 34 percent of respondents questioned by Merrill were overweight European equities, down from 38 percent in November. The value of mergers and acquisitions worldwide reached $3.5 trillion in 2006, according to data compiled by Bloomberg.

M&A Activity Near Record High As Buyout Firms Don't Let Up - Investor's Business Daily
Big private equity firms don't get to be bigger private equity firms by sitting on their cash. When they have a few billion dollars lying around, they find a place to put it. Lately they've been putting it into mergers and acquisitions. M&A activity in the U.S. is expected to reach at least $1.4 trillion for 2006, said Richard Peterson, director of Capital Markets at Thomson Financial. That's up nearly 22% from last year and the highest total since 2000. Global M&A activity has grown even faster, swelling more than 28% to nearly $3.6 trillion this year, topping the dot-com peak.

Dirty Wall Street Secret: Hedge Funds of Funds Barely Beat T-Bill Returns 
Pennsylvania's 200,000 public employees are paying Morgan Stanley some of the money-management industry's steepest fees to get returns that aren't much better than yields on U.S. Treasury bills. The Vanguard 500 Index Fund, which levies a 0.16 percent fee to track the Standard & Poor's 500 benchmark index of U.S. stocks, has returned 16.3 percent through Dec. 15.

Economic Report: U.S. Nov. PPI rises 2% on price gains for energy, cars MarketWatch
Producer prices soared in November at the fastest pace in decades, pushed higher by rebounding energy prices and a quirky gain in car and truck prices.

Sales at U.S. Retailers Rose 2.4 Percent Last Week, Smallest Gain in Month 
Sales at stores open at least a year rose 2.4 percent in the week ended Dec. 16 from a year earlier, the International Council of Shopping Centers and UBS Securities LLC said in a statement today.

AT&T'S $86 billion bid to buy BellSouth may face several conditions after a Republican FCC member said he won't vote on the deal due to ethical concerns (WSJ)