Boeing (NYSE: BA) lost its bid for the new Air Force tanker to Northrop Grumman (NYSE: NOC). The aircraft builder was able to get the process re-opened and now has a shot at getting the business that was awarded to Northrop.

Winning another chance at the big contract is not enough. According to The Wall Street Journal, "Boeing Co. said it is inclined to bail out of its effort to win a $40 billion contract to build aerial refueling tankers for the U.S. Air Force unless the Pentagon agrees to give it a total of six months to submit a new bid."

Boeing claims that it will take a long time to figure out how to configure one of its airplanes to haul the amount of jet fuel required by the Air Force.

The request is bogus. Boeing has been through the bidding process for the tanker once before. The idea that the company did not understand the specifications is remarkable.

Boeing may be trying to gain time to shave some of its costs off the project so that it can bring the price of its bid down. It should have done that in the first round. There is no reason it should get that additional time.

It is no wonder Northrop got the original approval, and it is likely to get it again in this round.

Douglas A. McIntyre is an editor at 247wallst.com.

PepsiCo (NYSE: PEP), major rival of Coca-Cola (NYSE: KO), is letting the investing world know that it's doing fine. In one of the shortest press releases I've ever read, management at the beverage maker let shareholders in on the fact that it intends to reiterate guidance at The Deutsche Bank Global Consumer and Food Retail Conference that takes place next week in Paris. PepsiCo believes it's still good for $3.72 per share in earnings for the fiscal year.

When the world seems to be heading for the dark pits of economic hell, it's nice to know that PepsiCo expects to be able to stay the course and deliver on an earlier forecast. After all, with all this talk of inflation, one would have to wonder how companies like PepsiCo and Coke can possibly remain stable given the difficult input-cost environment. The big question on my mind is how high these two companies might rise during the summer, since they are considered defensive plays. They didn't seem defensive at all on Wednesday during the Dow's 200-point bleed, but my gut is telling me they might be good short-term plays.

They certainly are excellent long-term plays, and while I own Coke, I'll concede that right now, in terms of P/E ratios and dividend yields, an investor wouldn't go wrong with either. And, yes, I'll further concede that one gets an added bonus with PepsiCo since it owns the strong Frito-Lay salty-snack business. But with both stocks down over the last six months (As of this writing, PepsiCo is down more than 11% for the six-month period while Coke is down more than 9%), and with problems in the markets, they might be interesting ideas right now. Again, though, the effect of input costs must be part of your due diligence before buying.

Disclosure: I own shares of Coke; positions can change at any time.

"Diageo (NYSE: DEO) is the world's biggest spirits company with operations in over 180 countries," notes Alexander Green. The contributing editor to The Money Map Report explains, "Diageo is a non-cyclical, recession-proof
stock we can count on to deliver solid results no matter which way the global economy heads."

The advisor explains, "The company's brands are some of the oldest and most successful: Smirnoff vodka, Guinness stout, Bailey's Original Irish Cream, J&B and Johnnie Walker Scotch whiskies, Jose Cuervo tequila, Captain Morgan rum and Tanqueray gin – among others.

"For the first six months of fiscal year 2008, the company beat expectations. Sales rose by 5.7%. Earnings advanced almost twice as fast, hitting $2 billion. And dissecting the results further reveals continued strength in international and emerging markets, with operating profits up 20%.

Kimberly-Clark (NYSE: KMB) reported for the first quarter today. Net sales increased almost 10% to $4.8 billion. Adjusted earnings per share increased 5% to $1.08. That's a rather small jump, granted, but you know something, it was enough to keep the stock in the green (at the time of this writing, at least) instead of in the red on a day when the major market averages -- and just about all of the stocks in my personal portfolios -- are bathing in the evil crimson color of doom. And according to Briefing.com, Kimberly-Clark played the beat-the-expectations game and won by the proverbial penny! Shareholders should be pleased.

A non-pleasing item to be found in the release centers on cash from operations -- it decreased by about $100 million to $426 million due to changes in working capital. That doesn't concern me so much right now, though, since Kimberly-Clark will probably do well over the coming years in terms of cash generation. The company, by the way, has been repurchasing stock, so management seems pleased with the shares as a potential investment idea.

Kimberly-Clark, which is a consumer-products business in the league of entities such as Procter & Gamble (NYSE: PG), Energizer (NYSE: ENR), Colgate-Palmolive (NYSE: CL), and Unilever (NYSE: UL), could be a value right now based on its P/E ratio and dividend yield. Out of the stocks mentioned here, I like P&G the best, but I do respect Kimberly-Clark -- in fact, it was mentioned recently in an article by Steven Halpern that centered on an analyst's picks for quality and yield.

Disclosure: I don't own shares in any of the companies mentioned; positions can change at any time.

Kraft Foods, Inc. (NYSE: KFT) is in a bit of a pickle. As the following article makes clear, the company knows it has to raise prices. There's just no choice in the matter. Commodity input costs are on the rise, and something has to give. But the problem is, consumers not only have to pay more for Kraft foodstuffs, they have to ante up more of the green stuff for everything else too -- fuel for the car, heating oil for the home, you know the drill.

If you're a Kraft shareholder, should this concern you? What about if you own other consumer-oriented stocks based on the supermarket shelves that are feeling the inflationary pinch, companies such as General Mills, Inc. (NYSE: GIS) -- which reported earnings today -- or Kellogg Company (NYSE: K), or maybe even beverage businesses like The Coca-Cola Company (NYSE: KO) or PepsiCo, Inc. (NYSE: PEP)? Well, it should, of course. Inflation is no fun, and with the price of oil hitting new highs recently, a trend that seems very much intact, consumers will be strapped. In fact, Kraft is now trying to make up for lower volumes by raising the cost of its goods; this isn't ideal, perhaps, but Rick Searer, who is the president of Kraft North America, brings up an almost humorous point -- "consumers have to eat." I have yet to meet one that doesn't, come to think of it!

But I think the consumer companies are relatively sophisticated with their data-analysis protocols and are, perhaps, a bit more nimble in terms of deducing what shoppers want to buy for purposes of stocking their pantries. At least, I would hope they are -- we've been hearing about better data-mining techniques for years. Kraft obviously will promote a wait-and-see attitude in terms of the consumer and her reaction to the recession, but I don't think shareholders should be overly worried at this point. A lot of these defensive names have international exposure and stand to benefit from the falling dollar, for one thing. For another, we all have to eat! And since the defensive names generally have dividend yields, they tend to be safer bets during a recession; don't think they can't fall, though, because they can. One just hopes they don't fall as much as, say, your typical financial entity or a broad market index.

Disclosure: I own shares of Coca-Cola; positions can change at any time.

"It's time to go value investing," says contrarian Eric Roseman, adding, "It's time to sink your teeth into America's oldest confectionary company" -- The Hershey Corporation (NYSE: HSY).

The editor of the industry-leading Commodity Trend Alert explains, "We love chocolate and want to own a great brand name that is likely to be acquired or partially acquired by a competitor at this low price." Here is his review.

"There's nothing more satisfying than a candy bar -- well, almost. I get even more excited about finding a great company or, in this case, a chocolate franchise selling at a distressed price, paying a nice dividend and home to shareholder activists seeking to boost their return on equity.

"We have regularly sought to identify distressed or contrarian blue chip stocks since 2001. The bottom line has to be deep-value and a strong catalyst for change as corporate earnings perform a 360-degree turn.

"Over the last two years, Hershey's common stock has been a real dog. HSY has shed almost half of its value since 2006, as investors grow frustrated with its board, ownership structure, faltering sales and a rudderless earnings strategy.

Recently, Merrill Lynch's chief North American economist David Rosenberg (and a few others) have taken the plunge saying that a recession is now underway in the United States. But that doesn't mean they were necessarily first to make the call.

If you look at how various sectors have performed since the S&P 500 index hit a closing peak of 1565.15 on October 9, it seems like investors, collectively speaking at least, were ahead of the forecasters.

From the point the market reversed and began the descent that has continued into 2008, some of the best performing groups have been those that are generally seen as "defensive," including utilities, consumer staples and health care.

What should one not expect from Aetna? Ill-conceived, poorly-researched endeavors. Aetna is a deliberate, move-forward-cautiously operation with a corporate culture that reflects many of the values of the land of steady habits, its home state of Connecticut. Aetna's shares rose $2.08 to $54.98 in Thursday afternoon trading.

• Altria (NYSE: MO) ($67.83; -$0.44; -0.6%) has a 14 P/E ratio and a 4.4% dividend yield. This was also one of Cramer's TOP 2007 PICKS, but for different reasons.
• Anheuser-Busch (NYSE: BUD) ($49.92; +$0.20; +0.4%)as the beer drinkers play -- don't people drink more beer when they are stressed? The 18.9 P/E and the 2.7% dividend yield are better than most beverage plays.
• ConAgra Foods (NYSE: CAG) ($25.53; -$0.04; -0.15%) has a 16+ P/E and its 2.8% dividend yield is higher than most food suppliers.
• Johnson & Johnson (NYSE: JNJ) ($61.76; +$0.10; +0.2%) as one of the more beaten up drug and medical names, plus the personal care products angle. The 17 P/E and the 2.7% dividend yield aren't going to kill you.

.Tonight on CNBC's MAD MONEY, Jim Cramer tauted Reynolds American (NYSE:RAI) as a high dividend stock with a safe yield that out pays US treasury yields. Even with the 5.5% yield he thinks this dividend is not at risk like some other high yield stocks. He sounded like he even likes it better than Altria (NYSE:MO) as the smokeless tobacco is doing well.

I have noted before about defensive stocks being the way to go and those companies' products are the ones you eat, drink, smoke, and use for critical personal hygiene (toilet paper, tooth paste, deodorant... you get the idea). We noted the sector back on our own list we titled "Defensive Stocks For A Crummy Market" recently, although we had others. Defensive investing is what investors will flock to when they have to own stocks but want to be a bit more conservative than chasing the "New Four Horsemen of Tech" or want to go for less aggressive picks than say his TOP NINE STOCKS for 2007.

Jon Ogg is a partner at 24/7 Wall St. and publisher of Special Situation Investing Newsletter. He does not own securities in the companies he covers.