Bayou Guilty Pleas

The two men behind the Bayou Group hedge fund pleaded guilty to defrauding investors who had entrusted them with $450 million. For nearly eight years, founder Samuel Israel III and finance chief Daniel Marino reported spectacular results that attracted investors and earned them spectacular fees. In fact, the fund was losing money. Authorities finally caught up with the fraud and stopped Israel from transferring the last $100 million through an Arizona bank. The fraud's brazenness prompted calls for tighter oversight of unregulated hedge funds.

DreamWorks Deal Derailed

Merger talks between DreamWorks and General Electric's NBC Universal broke down, reportedly over the $1 billion price DreamWorks founders Steven Spielberg, David Geffen and Jeffrey Katzenberg were seeking, along with Spielberg's demands for artistic and business autonomy. The merger would have allowed Universal to continue distributing DreamWorks films while bringing greater efficiency to its production studios. It also would have given the DreamWorks founders an elegant way to cash out on the studio they founded in 1994.

Greenspan's Addresses

Fed Chairman Alan Greenspan said borrowing against home values added $600 billion to consumer spending power last year, the equivalent of 7 percent of after-tax personal income. When that trend reverses, he told a bankers' group, the economy will slow, although it need not fall into recession. In another speech, Greenspan acknowledged that a byproduct of the Fed's success in controlling inflation was lower average investment returns, leading some investors to make the speculative investments that cause asset bubbles.

Boeing Machinists Return

With orders piling up and delivery deadlines approaching, Boeing settled a four-week strike by machinists by agreeing to sweeten pensions and absorb any increases in the cost of health insurance. While those were clearly the priority items of Boeing's aging workforce, the machinists gave up any increase in base pay, settling for about $11,000 each in lump-sum bonus payments. Boeing said the three-year contract, brokered by former Rep. Richard A. Gephardt, won't cost it any more than the one it had proposed.

Russia Reclaims Oil Assets

Having botched the privatization of its oil industry a decade ago, Russia seems intent on getting it back. The biggest firm, Yukos, is in the process of being seized after the jailing of its founder, Mikhail Khodorkovsky. Now Gazprom, which is 51 percent government-owned, will buy a majority stake in Sibneft, the fifth-largest, for $13.1 billion from a group headed by Roman Abramovich, better known for his ownership of the Chelsea soccer club. Western oil companies, which likely would have paid more for Sibneft, weren't invited to bid.