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What does it say about David Beckham that he played for two of the most valuable soccer franchises in the world? That he has the status to command a “staggering” $49 million in 2007, according to a new Forbes report Wednesday.

And that the suits at Major League Soccer figured right: Becks would boost attendance at games once he came to play in the U.S. And so he has, by 49%, according to Forbes.

Beckham’s most recent former club, Real Madrid in Spain, is No. 2 on Forbes list of most valuable franchises, worth $1.29 billion. Manchester United, his club before that, is No. 1 on the list with a current value of $1.8 billion.

Liverpool cracks the Top 10 for the first time, Forbes said, rising seven spots to No. 4 with a value of $1.05 billion, behind Arsenal, with a value on $1.2 billion.

Forbes said it values teams based on what they have sold for in the past relative to sales and profits, broadcast agreements and debt from new or pending stadium deals.

It’s no wonder American investors have flocked to the English Premier League in recent years, buying up Manchetser United, Liverpool, Arsenal and Aston Villa. Forbes list is below.

Rank	Team	Current Value ($ Mil ) 	Operating Income ( $ Mil )
1	Manchester United	$1,800	$111
2	Real Madrid	        $1,285	$112
3	Arsenal	                $1,200	$77
4	Liverpool	        $1,050	$60
5	Bayern Munich	        $917	$72
6	AC Milan	        $798	$54
7	Barcelona	        $784	$92
8	Chelsea	                $764	$-5
9	Juventus	        $510	$35
10	Schalke 04	        $470	$36

The Fed did what was expected Wednesday, cutting its key interest rate target by a quarter of a percentage point, and sent out a subtle signal that the cycle might be coming to an end. But for many investors, the accompanying statement is a confusing one, leaving many in doubt over whether the Fed has moved to a neutral stance. Stocks, the U.S. dollar, Treasurys, gold and oil all remained extremely choppy following the Fed’s interest-rate announcement.

“The substantial easing of monetary policy to date, combined with ongoing measures to foster market liquidity, should help to promote moderate growth over time and to mitigate risks to economic activity,” the Fed said in its policy statement.

“Recent information indicates that economic activity remains weak. Household and business spending has been subdued and labor markets have softened further. Financial markets remain under considerable stress, and tight credit conditions and the deepening housing contraction are likely to weigh on economic growth over the next few quarters.”

• Jeoff Hall, economist at Thomson Reuters: “There were two dissents again…as the FOMC came out with a dovish statement, more closely resembling the last one than we had expected. We think the statement, while suggestive of a pause, leaves a wide open door for further cuts and only a slightly ajar window for hikes.”
• Michael Woofolk, senior currency strategist at The Bank of New York Mellon: “The Fed delivered the 25 bps rate cut that the market was expecting, but failed to provide the clear signal of a pause that many were looking for…The Fed proved simultaneously more bullish on the economy and less hawkish on inflation, maintaining their easing bias.”
• Tony Crescenzi, bond market strategist at Miller Tabak: “The Federal Reserve delivered upon expectations for a cut and a preference for pausing but did little else. The action and the accompanying statement reinforce the basis for recent movements in stocks, bonds, the dollar, and commodities, but provides no new basis for extending these moves … The Fed resorted to its usual tactic for indicating a preference for moving to the sidelines by referring back to previous actions.”
• Economists at research firm Action Economics: “The confusion appears to be in the accompanying statement, where the argument is whether or not the Fed has moved to a neutral stance … The jury is still out to a degree, though for now the FX market appears to be taking the view that the Fed is not yet committed to a neutral policy stance.”

Reflecting the lack of confirmation of a neutral stance from the Fed, the odds of further interest rate cuts increased after the Fed move. July fed funds futures rose 0.05 points to 98.04, which implies a 16% chance that the Fed’s target for overnight rates will be at 1.75%, down from the current rate of 2%, after the next policy setting meeting (June 24-25). Late Tuesday, the odds of a 1.75% fed funds rate in July were at 4%.

You may not be too thrilled about the sky-high price of oil these days, but Hess Corp. sure is. While American drivers are being squeezed at the pump, the giant energy company is enjoying some hefty profits.

On Wednesday Hess said first-quarter earnings more than doubled from a year ago, fueled in large part by soaring crude oil and gas prices and higher production. The company recorded profit of $2.34 a share on revenue of $10.72 billion, well above the expectations of Wall Street analysts, who were looking for earnings of $2.02 a share on revenue of $10.55 billion. Exploration and production earnings also doubled, reaching $824 million in the first quarter.

Oppenheimer analyst Fadel Gheit called it an “earnings blowout.”

“Hess earnings are among the most highly leveraged in the sector to changes in the crude oil prices,” Gheit said. “Hess has completely revamped its upstream operations in the last three years and now has one of the highest exploration potentials in the industry with key drilling prospects that, if successful, could significantly increase reserve, production and shareholder returns.”

Citi analyst Doug Leggate, too, said the focus of Hess has switched to exploration. “In our view, management has put in place one of the most attractive exploration portfolios in the sector - and, for a company of its size, any reasonable basis of risk could be material to the valuation,” he said.

So, what’s next on deck for Hess in terms of exploration?

Currently the oil company is drilling the Gulf of Mexico Pony prospect appraisal #2 sidetrack and in the second quarter it plans to start drilling the first of four back-to-back exploration wells in the Australia Northwest Shelf. In the third quarter, Hess plans to start drilling one exploration well in the offshore Brazil BM-S-22 Block and one in Libya’s Block 54. Hess also expects to start drilling on its Ghana Cape Three Points block sometime in the fourth quarter.

The Carlyle Group remains king of the private equity court, according to Private Equity International’s latest annual rankings of the largest 50 private equity firms, known as the PEI 50. Using capital raised over the last five years as its primary gauge, Private Equity magazine ranked the Carlyle Group number one for the second year in a row with $52 billion in capital raised since Jan. 1, 2003.

Goldman Sachs Principal Investment Area moved up one notch to second with $49.05 billion, while Texas Pacific Group of Fort Worth, Texas, jumped two spots to third with $48.75 billion. New York’s Kohlberg Kravis Roberts dropped two places to fourth with $39.67 billion, and London’s CVC Capital Partners was fifth with $36.84 billion.

Private Equity International said the 50 largest private equity firms raised an aggregate of $810 billion in private direct investment capital since the beginning of 2003, up 47% from $551 billion in 2007 using the five-year timeframe beginning in January of 2002. “The past year has seen record-breaking fundraising across the private equity industry, whereas 2002, captured in last year’s PEI 50, was relatively weak as a fundraising year.” The magazine publisher also said that over the past five years, the PEI 50 raised roughly 65% of the $1.246 trillion in total private equity capital raised worldwide.

Private Equity International found 68% of the firms on the list had headquarters in North America, 11 firms represented the United Kingdom and 5 firms were centered in Europe. With the transition of 11 new firms to the 2008 PEI 50, the magazine also noted a shift in the amount of New York and London firms to 52% of the 2008 top 50, up from 44% of the 2007 rankings.

The liquidity drought that sent banks and brokers running for cover in the second half of 2007 may have taken a bite out of more than just Wall Street, according to a recent study published by the Department of Commerce’s Bureau of Economic Analysis. Authors Thomas Howells III and Ralph Stewart said the downturn in the finance and insurance industries accounted for nearly half of the slowdown in economic growth during 2007.

“Overall, 13 of 20 private industry groups contributed to the slowdown in real gross domestic product (GDP) growth,” Howells and Stewart said. “[F]our industry groups (finance and insurance, construction, real estate and rental, and mining) accounted for about one quarter of GDP in 2007. However, they accounted for nearly 80% of the slowdown in economic growth.” GDP growth fell to 2.2% in 2007 from 2.9% in 2006, according to the study, while the finance and insurance industries’ value-added (a measure of an industry’s contribution to GDP) fell 0.3% in 2007 after rising 9.8% in 2006.

Within the private goods-producing sector, the study said growth in the value-added price index for construction slowed sharply, increasing 1.6% in 2007 after an increase of 10.3% the previous year. In contrast, the agricultural, forestry, fishing and hunting industry group turned higher, growing 26.9% in 2007 after contracting 3.5% in 2006.

Elsewhere, the information-communications-technology industries continued their double-digit growth, rising by 13.2% in 2007 and accounting for 22.3% of real economic growth. Howells and Stewart also said the utilities industry was the largest contributor to decelerating value-added price growth in the private services-producing sector; prices increased 2.8% in 2007 after increasing 12.1% the previous year.

Wall Street is on track to open little changed Wednesday ahead of a Federal Reserve decision on interest rates and a raft of earnings reports led by Procter & Gamble Co., General Motors Corp. and Colgate-Palmolive Co.

Citigroup Inc. shares are likely to come under pressure after it said late Tuesday it will sell $3 billion of its common stock in a public offering.

According to spread bettors IG Index, the Dow Jones industrial average is expected to open down about 6 points at 12,826. S&P 500 futures were off 0.60 at 1,390.70, while Nasdaq 100 futures dipped 0.75 to 1,938.25.

Wall Street turned in a mixed performance Tuesday as investors traded cautiously ahead of the Federal Reserve’s decision on interest rates. The Dow Jones industrial average fell 39.81, or 0.31%, to close at 12,831.94, the Nasdaq composite index gained 1.70, or 0.07%, to 2,426.10, and the Standard & Poor’s 500 index slipped 5.43, or 0.39%, to 1,390.94. The yield on the benchmark 10-year Treasury note fell to 3.82% from 3.83% late Monday, and light, sweet crude for June delivery fell $3.12 to $115.63 a barrel on the New York Mercantile Exchange.

ECONOMIC DATA:

• Employment cost index for the first quarter, 8:30 a.m. ET, 0.8% estimate
• Gross domestic product first-quarter advance report, 8:30 a.m. ET, 0.3% estimate
• Chicago PMI index for April, 9:45 a.m. ET, 47.5 estimate
• The Federal Reserve is expected to issue a decision on interest rates about 2:15 p.m. ET.

EARNINGS HIGHLIGHTS:

Company                 Symbol    Period     Estimate

Colgate-Palmolive         CL        1Q       $  .88
General Motors            GM        1Q        (1.60)
IAC/InteractiveCorp       IACI      1Q          .30
Ingersoll-Rand            IR        1Q          .73
International Paper       IP        1Q          .50
Kellogg Co.               K         1Q          .76
Kraft Foods               KFT       1Q          .40
Procter & Gamble          PG        3Q          .81
Starbucks Corp.           SBUX      2Q          .15
Time Warner               TWX       1Q          .23

Figures in parentheses denote losses.

AFTER-HOURS ACTION:

After Tuesday’s close of trading, Express Scripts Inc. said first-quarter profit rose 33%, and the pharmacy-benefits manager raised its estimate for full-year earnings from continuing operations. Ace Ltd. said first-quarter earnings fell sharply and Embarq Corp. posted a first-quarter profit that topped Wall Street estimates. Panera Bread Co. said its first-quarter profit dropped 17%, hurt by far higher wheat costs and an increase in labor and interest expenses, but the result beat analyst estimates.

Merck executives were likely reaching for heartburn medication Tuesday after the Food and Drug Administration issued a non-approvable letter for the company’s new cholesterol drug candidate Cordaptive. The company’s shares fell more than 10% during the day on the unexpected news, and several analysts cut their share prices on the stock as it lost the moderate 7.6% gain it had made at the end of last week.

The company says it plans to meet with the FDA and submit additional information on Cordaptive so that the FDA can better assess the drug’s risks and benefits. Cordaptive contains extended-release niacin, which has long been known to lower bad cholesterol and raise the levels of good cholesterol. But niacin has unpleasant side effects, namely flushing of the face and neck that makes a menopausal hot flash look like a warm breeze. So Merck added laropripant, a flushing inhibitor, which makes the niacin nicer.

The company says it’s still confident the drug ultimately will be approved, but this latest setback only adds to troubles that have lately revolved around its cholesterol franchise. Now that the timing of the drug’s launch is even more uncertain, a few analysts are even taking it out of their short-term models for the company.

Credit Suisse Analyst Catherine Arnold said that without the drug, Merck’s late-state pipeline is “mediocre.”

Several analysts wondered in notes to clients whether the non-approvable letter was more fallout from the recent flap over cholesterol drug Vytorin and the disastrous ENHANCE study, which showed Vytorin to be no more effective at lowering levels of plaque in the carotid artery than Merck cholesterol blockbuster Zocor, now available as a cheaper generic.

And as the FDA now seems to be more cautious about approving new drugs, following recent criticism in the mainstream media that it doesn’t demand enough long-term data on certain drugs before approving them, some analysts said the FDA would likely wait for data from some outcomes trials the company is running before making a final decision.

This could take years.

But it was also the uncertainty about the reason for the FDA’s decision that bothered analysts. What is it that the FDA specifically objected to and what kind of information do they want to see now? That seems to be between Merck and the FDA - at least for now.

The good news for Merck is that it was able to maintain its 2008 earnings and revenue outlooks because Cordaptive didn’t play a big part in the year’s profit projections. Also helping the company’s cause is that the European Union’s Committee for Medicinal Products for Human Use adopted a positive opinion for the drug - called Tredaptive internationally - last week.

Can Merck, still hailed by analysts as having strong fundamentals and healthy near-term top-line drivers, deliver with its core drugs like HPV vaccine Gardasil, avoid problems with the rest of the drugs in its late-stage pipeline and deliver strong sales of Tredaptive in Europe? It’s a possibility that might offset the setback to a certain extent, until the FDA hands down an approval.

Lately, all the plaudits - and there have been few for U.S. auto makers - have flowed to Alan Mulally and his management team at Ford Motor Co. The former Boeing Co. executive has won praise for managing Ford’s turnaround, stabilizing some of its market share decline and cutting $5 billion in costs - with enough promise evident to lure Kirk Kerkorian into a $760 million planned stake.

Not so for the bosses at General Motors Corp., which is set to report first-quarter results Wednesday.

GM is overpromising and underdelivering, analysts say, at a time when consumer confidence is falling, housing starts have slowed and home values are evaporating.

On Monday, GM slashed its 2008 full-size and SUV pickup production by 138,000, which idles 3,500 workers on nearly full pay, according to Credit Suisse analysts. That could slice $1.28 billion, or about $2.48 a share, from GM’s earnings this year.

Bear Stearns forecasts GM to have, with its heightened incentives - the industry averages nearly $4,000 to move each domestic truck - “continued market share losses for the foreseeable future into a fading product cadence and a declining ‘08 market.”

GM also has set “unnecessarily high expectations near-term,” that include a forecast for an industry light-duty seasonally adjusted annual rate of 15.7 million vehicles. Bear Stearns put the figure at 14.9 million.

“Clearly, the most significant structural issue is the company’s overdependence on the full-size truck market, especially given oil well above $100 per barrel,” said Joseph Amaturo of Buckingham Research, who cut his target price on GM shares to $13 from $17 Tuesday.

GM, he noted, also is struggling with significant other issues: financing of Delphi’s exit from bankruptcy, managing a work stoppage at supplier American Axle and deteriorating earnings at its GMAC finance unit.