Ford Taunts GM, Chrysler With Stock Offering

The Wall Street Journal off-leads and Bloomberg reports that Ford Motor Co. (F), the most robust of the Big Three, plans to issue 300 million shares of common stock in a public offering that will further distance itself from its crosstown rivals and will take advantage of an 11-week stock rally. The New York Times highlights that dull small-town banks are doing fine just as they are, thankyouverymuch, and the Washington Post says that retailers, including Starbucks (SBUX) and teen-clothier American Eagle (AEO), have begun developing low-cost products to help stay in business in the post-splurge era.

At least some of the money raised by Ford in the impending stock offering—perhaps up to half—will be used for a union-run medical trust. The rest will simply be used to stave off federal aid. With the offering, Ford could raise $1.7 billion to $2 billion. According to the WSJ, the offering indicates the company believes investors will pin their hopes on it as General Motors Corp. and Chrysler are consumed by uncertain reorganizations. Ford also thinks that raising the cash is worthwhile, despite any backlash from current stockholders who don't want their shares to be diluted. Ford is facing close to $10 billion in health costs for retired union workers.

At a recent gathering hosted by the Indiana Bankers Association, community banks played up their own plain vanilla-ness, casting themselves as diametric opposites to their big-city counterparts, the NYT says. And they are so fed up with being grouped together in the banking crisis, they've launched a diffuse public relations campaign to let consumers and investors know: We ain't like the big guys. In covering the banking crisis, they said, the media have grouped the 7,630 community banks together—the vast majority of which have watched the crisis like bystanders at a 10-car pileup. And though they outnumber the national and regional banks, community banks have barely registered in any of the fallout from the credit crisis. So, stop saying the banks when you're only referring to Citigroup (C) and Bank of America (BAC), and you'll make at least a few Indiana bankers very happy.

Starbucks, in response to penny-conscious consumers, dropped the price of a medium iced coffee last week, and American Eagle has cut out the ribbon from the inside waistband of its khakis to lower the cost. These are just two examples of many that show how retailers are dealing with a different beast of consumer—one that is less beastly, according to the WP. The new consumer has curtailed spending and increased savings to 10-year highs. Smaller houses are newly coveted, bringing the average size of a new home down in 2008 for the first time in 35 years, according to the National Association of Home Builders. So retailers, which revisit their prices and product assortment seasonally, are being particularly conservative this summer. Whether lower prices will boost the stores' bottom lines is yet to be seen.