Strong Sales for Some Retailers, for Wal-Mart a Dividend

Another "comp" day has come and gone, but unlike most monthly retail sales days we saw beats across the board.

David Paul Morris | Getty ImagesRetailers posted strong sales on Thursday, helped by mild weather, which encouraged shoppers to buy spring clothing.

Well, with the exception of Kohl's [KSS  Loading...      ()   ] . There is always one in the crowd.

In any case cheers to the weather, which helped February's results.

The biggest news of the day was Gap. (Who doesn’t love an underdog sales story?)

Gap [GPS  Loading...      ()   ] proved all those naysayers wrong with positive comparable store sales, or comps, a key metric that measures sales at stores open at least 12 months. Gap's sales not just had a plus sign in front, but it was a gain of 4 percent.

Yes, that color in the stores and the better fabrics in its clothing are driving its business. And I am sure weather did not hurt. Not to mention, a little cat-and-mouse game it played by not revealing how well things were going on last week's fourth-quarter conference call. While I have been touting the response to Gap's new products during my store tours, Gap faked me out on the magnitude of this one.

And now onto other good news, although not as shocking to the system as Gap's.

Nordstrom [JWN  Loading...      ()   ] and Ross Stores [ROST  Loading...      ()   ] both put estimates to shame and came in almost two-times the Street's forecasts.

The high-end consumer still has plenty of steam, while the off-price players are capturing share from the middle players. Some are lost in transition — J.C. Penney [JCP  Loading...      ()   ] — and some just lost — Kohl's.

The Middle Ground

But Macy's is an exception. The department store chain [M  Loading...      ()   ] beat with a 4.6 percent same-store sales increase versus a 3.5-percent estimate from the Street. This comes after a disappointing January. However, even a light January did not keep the company from raising numbers.

Let's face it Macy's is the outlier of the mid-tier players. Training, localization of product and a focus on the omnichannel approach has paid off with consistent comps.

On the other end of the spectrum there is Kohl’s. The company's comps fell 0.8 percent in February versus an estimate of breakeven results. But to be fair, the company did tell us the February comp would be worse than first-quarter guidance of 1 percent. Analysts may not have taken the cue far enough.

Going forward, this is a back-half weighted comp story with renewed pricing efforts. I am not worried for Macy’s quite yet.

Wal-Mart vs. Target

Target [TGT  Loading...      ()   ] put up a 7 percent comp for February with food, apparel  and accessories above company average (cheers to the weather), and household essentials, home and hardlines all increasing. Target no doubt had a little help from the weather, but that is not the whole story. Exclusive product, including the Jason Wu intro in February, as well as momentum in its effort to remodel stores are internal drivers.

But if you can’t give investors favorable comps,  give them dividend growth.

Wal-Mart [WMT  Loading...      ()   ] reported U.S. same-store sales of 1.5 percent for fourth quarter (We do not know how February fared because the company no longer reports its sales on a monthly basis). The fourth-quarter sales were disappointing and raised questions about when its investment in keeping prices low was having the desired effect. While traffic turned positive, last quarter's results were simply not enough.

On Thursday, Wal-Mart suggested its U.S. business is “back on track” and raised its dividend by 9 percent. (WMT raises every year). While returning cash to shareholders is always a welcome move, consistent comps are the key — especially with the backdrop of strength reported today.

Stacey Widlitz is the President of SW Retail Advisors Inc. She has worked at UBS, SG Cowen, Fulcrum Partners and in 2005 was one of three analysts to launch the Research Department at Pali Capital, where she covered Retail and Home Video for 5 years.

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Kid Rock rocks out for Romney after secret meeting

ROYAL OAK, Mich. - It had all the fixings of a Mitt Romney rally, and then Kid Rock hit the stage.

On the eve of the Michigan primary, musician Kid Rock sang a live version of "Born Free," the official campaign song of the Romney campaign and a song that, until tonight, has only been heard in its recorded version, blaring through speakers at events from New Hampshire to Iowa to South Carolina, and everywhere in between.

"The other day I got in my car and I drove out to a home of a fellow that lives in this area, and I asked him whether he might come here tonight," said Romney, standing on a stage at the Royal Oak Music Theatre, surrounded by subwoofers and a drum set, the replica of the debt clock he so often uses to tout his economic dexterity was nowhere to be seen.

"I think you know him pretty well. He's a native son of Detroit, loves Michigan, loves Detroit. He's recently made quite a commitment - he said he's going to raise a million dollars for (the) Detroit symphony. He put a piece of paper in front of me. He'd written down some questions for me. He said first of all, he said, 'Mitt, if you're elected president, will you help me help the state of Michigan?' And I said I would," said Romney, teasing Kid Rock's performance that had only been described as a "surprise musical guest" in campaign advisories.

The odd couple - Romney a squeaky clean family man who obeys the pillars of his Mormon faith,  and Kid Rock, a Hollywood bad boy who has a sex tape and a criminal record - apparently met last week behind closed doors, when Romney went to the singer's suburban Michigan home on February 23.

The meeting lasted for about an hour, according to a campaign aide, who described it as a "warm and friendly conversation" during which the two discussed their "similar interests," including Romney's commitment to Michigan, Detroit and the troops.  Kid Rock recently pledged to play a charity concert to raise $1 million to go toward saving the Detroit Symphony Orchestra and Romney has pledged his support of the state of Michigan again and again on the stump.

According to the aide, a representative from the Romney campaign had reached out to the musician, whose birth name is Bob Ritchie, when the Michigan campaign schedule began to finalize, requesting a live appearance after getting permission to play the audio of the song months earlier.

But Kid Rock insisted on meeting Romney in person, the aide said, a get-together that was attended by the candidate and at least one senior advisor. The day after the meeting, February 24, Kid Rock e-mailed Romney on his personal e-mail address and agreed to perform at tonight's rally.

Romney himself characterized the conversation with Kid Rock in his introduction to the singer this evening, recalling how the singer didn't agree to perform until he made some promises too.

"He said, 'If you're elected president, will you help me help the city of Detroit?' I said I would. And then I turned to him, and I said, 'By the way, given the fact that I'm willing to do those things, will you come here and perform a concert tonight for my friends, and he said he would," said Romney. "So I'm happy to introduce a son of Detroit, a friend, a guy who makes great music, who introduces me by DVD everywhere I go - Kid Rock!"

As Kid Rock belted out the lyrics to "Born Free," Romney and his wife Ann stood and listened, tapping their feet, clapping and whistling in support.

Jumping back on stage after the song, Romney shook hands with Kid Rock and the musician kissed Ann on the cheek, the trio exchanging pleasantries as the crowd of hundreds cheered and the rest of the band began to put their electric guitars back in cases, readying to jump on the road for their next gig - -scheduled in a few days in Texas.

Turning to address the crowd for one more time before polls open tomorrow morning, Romney's microphone wasn't turned on, forcing him - after some coaxing from Ann - to take Kid Rock's microphone.

"Not to be confused with the real artist," Romney quipped. "Thanks, you guys. It's great for you to be here. I appreciate it so much. Thanks to Kid Rock. Thank you to Kid Rock and to his band. These guys did a great job. Real kind of them."

"You guys, thank you so very much. We love you. Thank you. Have a great night. See you tomorrow, and a big victory."

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Tony Award-winning producer, director Theodore Mann dies

NEW YORK (AP) — Theodore Mann, a Tony Award-winning director and producer who championed Eugene O'Neill and was a driving force behind Circle in the Square Theatre and its school, has died. He was 87.

Paul Libin, president of Circle in the Square Theatre and former chairman of The Broadway League, said Mann died Friday in New York of complications from pneumonia.

"His contributions to Broadway and off-Broadway are immeasurable both in the productions he created, and the talent that he nurtured," said Charlotte St. Martin, the executive director of The Broadway League. "He will be missed by many in our community, and our hearts go out to his friends, family, and students."

A co-founder of Circle in the Square Theatre in 1951, Mann spearheaded in 1956 the acclaimed revival of O'Neill's "The Iceman Cometh" and the American premiere of O'Neill's "Long Day's Journey into Night." According to the League, those two productions led to a reevaluation of O'Neill, now recognized to be America's greatest playwright.

Mann produced or directed more than 175 plays at Circle, which in 1972 moved from Greenwich Village to its current in-the-round stage on Broadway. In 1963, he founded Circle in the Square Theatre School, a program for training young actors.

Some of the school's alumni include Philip Seymour Hoffman, Kevin Bacon, Lady Gaga, Benicio del Toro, Idina Menzel, Felicity Huffman and Molly Shannon.

Mann received the 1957 Tony Award for Best Play for "Long Day's Journey Into Night," a 1976 Special Tony Award acknowledging 25 continuous years of quality productions at Circle in the Square, as well as 12 additional Tony Award nominations.

Together with Libin, Mann presented new and classic works at his theater, including works by Sam Shepard, Thornton Wilder, Horton Foote, Yazmin Reza, Truman Capote, Arthur Miller, Athol Fugard and Terrence McNally.

Some noted Circle productions include "Uncle Vanya" with George C. Scott; "The Lady from the Sea" with Vanessa Redgrave making her Broadway debut; "Salome and Hughie" with Al Pacino; "The Iceman Cometh" with James Earl Jones, which Mann directed; "Candida" with Joanne Woodward; and "Death of a Salesman," also with Scott.

The Circle lately has been home to the Broadway premiere of Sam Shepard's "True West," the revival of "The Rocky Horror Show," ''Sweeney Todd," ''The 25th Annual Putnam County Spelling Bee," Alan Ayckbourn's "The Norman Conquests," ''Lombardi," and the current revival of "Godspell."

"I first met Ted on my initial site visit of Circle in the Square, when 'Godspell' in the round was just a concept. There he was, to say hello, to shake my hand, and to welcome me to his house," ''Godspell" producer Ken Davenport wrote in his blog Monday. "His fingerprints are on a lot of resumes of some of our industry's finest actors and finest artists."

Mann also directed operas, including Benjamin Britten's "Turn of the Screw" for the New York City Opera, "La Boheme" for the Juilliard School, and "The Night of the Iguana" for Moscow's Maly Theater.

He was married to the late Patricia Brooks, a leading lyric coloratura soprano, who died in 1993. He is survived by his two sons, Andrew and Jonathan, and five grandchildren.

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Homes of NBA Stars

In the fickle world of celebrity real estate, athletes are among the more likely people to buy and sell and rent new homes, as they are subject to the whims of where their contracts take them. And in the slides to follow, you’ll also see a few properties affected by the 2011 NBA lockout. In the basketball world, as we’ve seen in other celebrity real estate slideshows, a property sometimes trades from one set of famous hands to another pair. This recently happened with a celebrity-pedigreed house that’s been on the market for nearly a year. Chris Paul bought the Bel Air house owned by singer Avril Lavigne.The houses ahead, most provided by Realtor.com and Zillow, are a window into recent comings and goings in the basketball world. It will reveal what Dallas Maverick Lamar Odom has in common with a new guy you might have heard of, Jeremy Lin. We begin with a bit of (pardon us) Lintrigue involving four NBA players and two states.By Colleen KanePosted 24 February 2012

streeteasy.comInset: Chris Chambers | Getty ImagesPrice: Less than $13,000 / month Location: New York Bedrooms: 2 Bathrooms: 2 Square footage: 1,182 When the new Knick star first spread Linsanty upon the nation, he was crashing on his brother’s couch with no home to call his own. However, he just signed up for a furnished Sunshine Select Residence at the W Downtown hotel and residences [pictured at left], according to the New York Post. The Wall Street Journal says Lin got “a better deal” for the apartment than the listed monthly rent of $13,000.  Earlier, the New York Daily Newsreported that Lin had sublet an apartment from former Knick David Lee at Trump Tower in suburban White Plains for about $3,800 a month. The newspaper said it used to belong to Amar’e Stoudemire before Lin’s teammate moved to swankier digs in Manhattan. The Journal says Lin never actually lived there. Fellow B-baller Lamar Odom, who plays for the Dallas Mavericks, also livesin a W Hotel and residences building with his wife, Khloe Kardashian. Among the amenities for W residents are a digital gaming lounge and a rooftop terrace. It’s not the fanciest apartment available in the building. Lin opted for a mid-level apartment, the Post says. Still, he’s gone a long way from couch-surfing in just a few weeks.

zillow.comInset: Jared Wickham | Getty ImagesPrice: $3.7 millionLocation: Southwest Ranches, Fla.Bedrooms: 6Bathrooms: 6Square footage: 14,555Last fall, the Knick All Star who became a pro baller right out of high school in 2002 bought a custom house in his native state of Florida. The mansion is in Southwest Ranches, a suburb of Fort Lauderdale, and Stoudemire got it for a discount from the original $4.65 million asking price, according to the real estate website Zillow.com.The 3-year-old luxury property features soaring ceilings to accommodate the 6-foot-11 Stoudemire and his tallest ball-playing visitors, two bars and a summer (outdoor) kitchen for their enjoyment,  a heated pool with waterfalls and slide for their entertainment, and a nine-car garage.  Stoudemire also rents a $37,500-a-month apartment in the 99 Jane Street building in New York’s West Village, Zillow says.

Courtesy of the DIY NetworkInset: Christian Petersen | Getty ImagesPrice: $1.55 million in 2005Location: Lake Minnetonka, Minn. Bedrooms: N/ABathrooms: N/ASquare footage: N/AAs you might have heard, New Jersey Net Kris Humphries recently had cause to move back to his house on Lake Minnetonka in his home state of Minnesota. Enter the DIY Networks program “Man Caves,” which intervened to properly bachelor up the pad for an episode in January.According to DIY Network, the redecorated lake hideaway features a dark palette of colors and the windows are fitted with gray shades for privacy. In the master bedroom, the initials KH dominate from above the bed, which is flanked by quilted-looking metallic walls. The lounge is outfitted with black Barcelona chairs, a TV that takes up the entire wall and turns opaque when not in use, a bar with monogrammed KH tumblers and kegerator, and a deluxe coffee station with flavored syrups galore, so the caffeinated Humphries can stay up as late as he wants watching sports and eating junk food.

zillow.comInset: Chris Trotman | Getty Images Price: $6.2 millionLocation: Littleton, Colo.Bedrooms: 8Bathrooms: 9Square footage: 21,083 Former Denver Nugget and current Knick Carmelo Anthony put his Colorado mansion on the market in June 2010 for $9.5 million when he was anticipating the change of teams, and there his house stayed for a year before selling for $6.2 million. That’s even less of a good deal considering he paid $12.2 million for it in 2007, according to nbcnewyork.com. Located in the gated community Polo Ridge Estate, the mansion has a music studio and a barn with pasture, along with the more expected luxury amenities like a guest house, pool, gym and seven-car garage.

touzetstudio.comInset: Kevin C. Cox | Getty ImagesPrice: $12.333 millionLocation: Miami Beach, Fla.Bedrooms: 7Bathrooms: N/ASquare footage: 12,000Miami Heat forward Chris Bosh’s choice of a minimal modern architectural mansion is a welcome break from the gilded, pillared and ornamented new mansions chosen by so many of his athletic contemporaries. The asking price was as high as $18 million and dipped down to $14.97 million, but Bosh got the even better price of $12.333 million when he purchased it in 2010., according to The Miami Herald.The all-white structure offers floor-to-ceiling views of the infinity pool and beyond that, Biscayne Bay, and includes more than 100 feet of waterfront property with a dock. Each of the seven bedrooms has a balcony.

zillow.comInset: Mike Ehrmann | Getty ImagesPrice: $2.5 million Location: Postal Store, Fla.Bedrooms: 6Bathrooms: 7.5Square footage: 9,035 In July 2009, Miami Heat’s Dwayne Wade tweeted that his house was on the market for $3.3 million, which he said was a “real bargain,” according to zillow.com. Despite that celebrity endorsement, the gated home didn’t sell until the next year for even more of a bargain at $2.5 million. The circa-2005 custom  house built on 41 acres features a gazebo and summer kitchen for outdoor entertaining. As for indoor entertainment, there’s a home theater and media room and an “enormous customized master suite.”

realtor.comInset: Ronald Martinez | Getty ImagesPrice: $1.595 millionLocation: DallasBedrooms: 3Bathrooms: 3 full, 1 halfSquare footage: 2,607The great NBA lockout of 2011 caused some basketball players to put their homes on the market, including Miami Heat forward Mike Miller and Boston Celtic Jermaine O’Neal, according to the Realtor blog. Dallas Maverick guard Jason Kidd was the third seller in that group. The 21st floor apartment offers views of downtown Dallas from its floor-to-ceiling windows that can be blocked out when desired with motorized Lutron blinds. Other features include hardwood and stone floors and a gourmet kitchen with Miele and Sub-Zero appliances. The condo even comes with a private four-car garage, but it is still up for sale.

realtor.comInset: Mike Ehrmann | Getty ImagesPrice: $8.995 millionLocation: Pompano Beach, Fla.Bedrooms: 6Bathrooms: 10Square footage: 8,870 Speaking of Miami Heat forward Mike Miller, one of the basketball players to list his home during the 2011 lockout, his Florida mansion is still on the market. It has views of the Atlantic and a private dock offering access to Hillsboro Bay. It has soaring ceilings and marble floors throughout, a master bedroom with two master baths, including a raised Roman bathtub. The outdoor pool has a swim-up wet bar, just like all the best resorts. 

realtor.comInset: Streeter Lecka | Getty ImagesPrice: $3 millionLocation: Newport Coast, Calif.Bedrooms: 5Bathrooms: 5 full 1 halfSquare footage: N/AOne player who bought instead of sold during the NBA lockout is former L.A. Clipper and current Charlotte Bobcat Corey Maggette. It listed for just under $3.5 million and sold for an even $3 mill.The 10-year-old Mediterranean-style home comes with canyon views and another NBA neighbor, according to the Orange County Register. The Lakers’ Kobe Bryant owns two homes in Pelican Ridge.

jeffrealty.comInset: Scott Halleran | Getty ImagesPrice: $12 million to $20 million to buildLocation: Jupiter, Fla.Bedrooms: 11 Bathrooms: N/ASquare footage: 28,000And to end with a legendary old-school basketball player, let's take a look at his enormous mansion complex. Michael Jordan's compound is in the 55-estate luxury community developed by eminent golfer Jack Nicklaus, known as the Bears Club. The community is already very private, but Jordan’s grounds have a two-story guardhouse. Naturally, the sprawling estate also features an athletic wing with a basketball court and gym, a guest house and a pool house.

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Can corporations accused of abetting torture abroad be sued?

On Tuesday the Supreme Court will hear a challenge brought by 12 Nigerian plaintiffs who say a Shell oil subsidiary  aided and abetted acts of murder, rape and systematic torture by the Nigerian government in the early 1990s.

At issue is whether corporations can be sued in U.S. courts for violations of human rights committed abroad.

Human rights groups hope the high court will reverse a 2010 lower court decision that held that corporations - unlike individuals - cannot be sued under the Alien Tort Statute, a  federal law that allows foreigners to bring lawsuits in U.S. federal court for violations of international human rights law.

Lawyers for the plaintiffs, who were associated with the Movement for the Survival of the Ogoni People,  allege in court papers that the Nigerian military, assisted by Shell's operations in the region, "engaged in a widespread and systematic campaign of torture, extrajudicial executions, prolonged arbitrary detention, and indiscriminate killings constituting crimes against humanity to violently suppress the movement."

In court papers, lawyer Kathleen M. Sullivan, representing Royal Dutch Petroleum Co., a holding company for Shell, says the lower court was right to find that international law does not recognize corporate responsibility for the alleged offenses.

Sullivan says the Nigerian plaintiffs "fail to demonstrate that international law, with the requisite specificity and universal acceptance, imposes responsibility on corporations for the offenses alleged here. "

Ralph G. Steinhardt, a law professor at George Washington Law School, says the lower court got it wrong.

"The lower court in this case was alone among federal courts of appeals in concluding that corporations never - under any circumstance - have obligations under international law," says Steinhardt who filed a brief representing international law scholars on behalf of the Nigerian plaintiffs. "Four other courts of appeals have explicitly reached an opposite conclusion."

The United States government  has filed a brief in support of the plaintiffs.

"The United States has taken the position that whatever complexities may arise in future cases, the absolute rule adopted by the court of appeals in this case is wrong, " says Steinhardt.

The Alien Tort Statute was part of the first piece of legislation adopted by the U.S. Congress in 1789 largely for the purpose of making sure that foreigners injured by violations of international law could use U.S. courts to get compensation.

Only in the 1980's was the Alien Tort Statute used to enforce human rights law.

Peter Weiss, vice president of the non-profit group Center  for Constitutional Rights, was the first to use the Alien Tort Statue to go after individuals who had committed human rights crimes abroad. Later the statute was applied to corporations with ties to the United States.

"The interesting thing is that until the Second Circuit decision came down, the question of whether a corporation  can be sued under the Alien Tort Statue was never raised. Not by defendants, and not by judges," says Weiss. "Then all of a sudden the Second Circuit  said it is not part of customary international law to be able to sue corporations  for human rights violations. "

Weiss says that if the Supreme Court rules against liability for corporations, it will still leave open the possibility of suing individuals in those corporations who may have been guilty of committing  crimes, but that is a much harder case to prove.

John B. Bellinger III, who served as the legal adviser to the Department of State during the Bush administration, argues  that the Supreme Court should curb the Alien Tort Statute.

"More than 120 lawsuits have been filed in federal courts against 59 corporations for alleged wrongful acts in 60 countries," Bellinger writes in a recent opinion piece for the Washington Post .

He says that few of the lawsuits against entities such as ExxonMobil and Coca-Cola have resulted in judgments, "but most cases have dragged on for years, and some companies have settled rather than submit to protracted and reputation-damaging litigation."

On the diplomatic front he said the Obama administration should be concerned about reciprocity. The administration "would certainly object if foreign governments were to encourage lawsuits in their courts against U.S. companies for perceived violations of international law, such as against the manufacturers of drone aircraft."

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Google Donates Biz Software for Mac File Encryption

Google is helping Macs move into big businesses. Again.

This week, Google announced that it would open source a software tool it built to automate the use of Apple’s FileVault encryption software inside the company. The tool works with FileVault 2, which made its debut with Apple’s Mac OS X “Lion,” and it’s called — of all things — Cauliflower Vest.

“While the new FileVault 2 offering is very well suited to consumers, some enterprises may require additional features that are not provided out of the box,” reads a blog post from the company.

With the tool, Google says, a company’s IT admins can forcibly enable FileVault 2 encryption on user machines, automatically escrow encryption recovery keys to a secure server running on Google’s App Engine cloud service, and securely access recovery keys so that volumes may be unlocked or reverted.

The product was developed for use inside of Google. “We are releasing this source code today as part of our commitment to share Google’s unique IT approach with the world,” read the blog post.

Cauliflower Vest

Officially, Mac OS X and the software that ships with it, including FileVault, are meant for consumers. But Macs — like iPhones and iPads — are working their way into businesses as well. Terry Cosgrove, an analyst with research outfit Gartner, estimates that Macs now account for almost 10 percent of the computers used by American businesses.

Google is a prime example of a business that has warmly embraced the Mac. Last year, Google co-founder Sergey Brin said that only 20 percent of the company was still using Microsoft Windows — though he added that he couldn’t be sure of the exact figure. In 2010, four months after Google said that Chinese hackers had pilfered unspecified intellectual property from the company’s systems, rumors indicated that the company was phasing out Windows due to security concerns.

No doubt, some of the other 80 percent are running Linux, but clearly, Macs are mainstay at the company. A year ago, Google open sourced Simian, a tool that deploys software changes and security patches to Macs across the network.

Google could not immediately be reached for comment.

Got a secret? Email caleb_garling [a] wired.com. Caleb covers tech, but loves other stuff like sports, fiction, beer, fun in remote places and music featuring guitars. Encircle on Google+, subscribe on Facebook or
Follow @calebgarling on Twitter.

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ECB's Latest Cash Injection: What Markets Will Look For

The European Central Bank’s first mass injection of cheap money into the European banking system last December was hailed as a success from almost all sides.

The results of the second round of Europe’s answer to quantitative easing , to be announced Wednesday, will be watched even more closely.

The first time around, the market underestimated how popular the three-year long-term refinancing operation (LTRO) would be — and how positive its effects could be — until traders returned to their desks after the Christmas break.

With the second round, there are a number of key questions to ask before deciding how to play it.

How Big Will It Be?

Analysts’ estimates for the second round have gradually been reduced, with most now believing that it will be similar to the first operation of 489 billion euros ($654 billion).

If the sum taken out is below 400 billion euros, this may also be viewed as positive, according to Peter Schaffrik, head of European interest rate strategy at Royal Bank of Canada, as it could indicate that banks do not need the new source of funding.

How Much of the Total Sum Is Actual “New Money”?

In the first operation, banks also slashed their use of the existing Main Refinancing operation and of the shorter, three-month LTROs, in favor of the new facility, making the net increase in outstanding ECB open market operations only around 210 billion euros.

This time around, analysts are predicting up to 300 billion will be new liquidity, as many of the MROs have already been taken out of the system.

How Will It Affect Markets?

In the immediate aftermath of the LTRO, a large takeup by European banks should help boost the recent risk rally in stock markets — which could in the long term help bolster the recovery around the world.

The second round of LTRO will be “almost as important for the U.S.” as for Europe, according to analysts at Bank of America Merrill Lynch.

A lot will depend on how banks use their new source of financing. If they choose to lend it, or to buy sovereign bonds, they could help struggling euro zone economies. If it is used just to bolster their own balance sheets, critics fear it will merely postpone the euro zone’s troubles until later.

The euro should be boosted slightly against the dollar in the short term, unless take-up is much higher or lower than expected, according to Lauren Rosborough, senior currency strategist at Societe Generale.

While there was a boost to peripheral bond yields — which were at close to unsustainable levels for countries including Italy — following the first operation, analysts at Bank of America Merrill Lynch warned that yields look less attractive second time around. The amount banks charge each other for lending should continue to gradually decrease.

When Will It Start Helping the Real Economy?

This is possibly the most important question of all — and the area where the ECB’s action is most open to criticism.

So-called “broad money” and bank lending both rose in January after falling toward the end of 2011, according to ECB data, which analysts at Credit Suisse believe is an encouraging sign that the “disorderly deleveraging” of the European banking system has halted.

Banks also continued to buy debt in troubled peripheral countries such as Spain and Italy, driving down their bond yields. And the deposit outflow in peripheral economies (apart from Greece) also halted following the operation, indicating that some consumer confidence is returning.

Yet the growth in demand for mortgages and other consumer-focused lending is still slowing, and the gloom across the euro zone has not lifted. Most economists still expect the region to fall into recession this quarter.

Ultimately, the most important effect which the LTRO has on the man in the street may be that its bolstering of the banking sector helps make a sustained recession less likely.

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