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Bank of America to axe 35,000 jobsBank of America (BoA) announced worse-than-expected job cuts of up to 35,000 yesterday on the back of its $50 billion ($£33.3 billion) rescue merger with Merrill Lynch and the weakening economic environment.Source: Latest Business News from Times Online | 12 Dec 2008 | 10:19 pm Beresford solicitors struck off after being found guilty over sick miners scandalHow The Times broke the storySource: Latest Business News from Times Online | 12 Dec 2008 | 3:15 pm Automakers bailout falls apart in SenateA $14 billion bailout deal to aid the struggling Big Three automakers fell apart in the Senate on Thursday night, Senate Majority Leader Harry Reid, D-Nevada said.Source: MarketWatch.com - Top Stories | 12 Dec 2008 | 12:55 pm 700 job cuts at Entertainment UKAdministrators at Woolworths' distribution arm, Entertainment UK, cut 700 jobs after failing to find a buyer for the business.Source: BBC News | Business | World Edition | 12 Dec 2008 | 12:53 pm EU agrees to 200 bln euro stimulus plan: reportsEuropean Union leaders agree Friday to provide a fiscal stimulus equal to around 1.5% of gross domestic product in an effort to lift the region’s economy out of a potentially deep recession, news reports say.Source: MarketWatch.com - Top Stories | 12 Dec 2008 | 12:49 pm Top Pre-Market Analyst Downgrades (AXL, AXP, COF, DRYS, EXPD, FII, F, LEA, SAP, TRW, VE, WAT)These are some of the top pre-market analyst downgrades and negative calls we are seeing this Friday morning:
Jon C. Ogg Source: 24/7 Wall St. | 12 Dec 2008 | 12:47 pm Stock futures point to sharply lower open (AP)
Source: Yahoo! News: Stock Markets News | 12 Dec 2008 | 12:44 pm Dollar hits 13-year low against yenThe dollar slumped below 90 yen on Friday for the first time in 13 years after US lawmakers failed to pass a rescue plan for ailing American carmakers while the euro hit a record high...Source: Infocious RSS raw feed - channel BNewsBusiness | 12 Dec 2008 | 12:43 pm UK credit card companies alter rate practiceCredit card companies have agreed to stop the practice of abruptly raising the rates paid by their most vulnerable customers, the British government said Friday. The credit card industrySource: Infocious RSS raw feed - channel BNewsBusiness | 12 Dec 2008 | 12:41 pm A day to 'dread' on Wall StreetU.S. stocks were set for a big selloff at Friday's after a $14 billion auto industry bailout plan collapsed in the Senate.Source: Business and financial news - CNNMoney.com | 12 Dec 2008 | 12:38 pm Global stocks diveStock markets around the world tumbled Friday after talks over a $14 billion bailout for the U.S. auto industry collapsed in the Senate.Source: Business and financial news - CNNMoney.com | 12 Dec 2008 | 12:37 pm Unanimous backing for EU bailout plan: BrownEuropean Union leaders reached unanimous agreement on a 200 billion euro economic rescue package at a summit in Brussels Friday, British Prime Minister Gordon Brown said. ...Source: Infocious RSS raw feed - channel BNewsBusiness | 12 Dec 2008 | 12:37 pm Currency gainsHow London taxis are exported around the worldSource: BBC News | Business | World Edition | 12 Dec 2008 | 12:36 pm London Markets: HBOS, Lloyds TSB fall more than 18% each in lower LondonBanks trade sharply lower in a downbeat London share market, playing off the revelation by lender HBOS that its bad-debt charge has soared to $7.5 billion.Source: MarketWatch.com - Top Stories | 12 Dec 2008 | 12:36 pm EU leaders agree on climate change dealDiplomats say European leaders have agreed on how they will carry out an ambitious plan to fight global warming. The plan lays out how the 27 member countries will cut carbon emissions...Source: Infocious RSS raw feed - channel BNewsBusiness | 12 Dec 2008 | 12:33 pm Stock futures sink on collapse of automakers' bailoutNEW YORK (Reuters) - Stock index futures plummeted on Friday as the collapse of a proposal to provide urgent funding for the beleaguered U.S. auto industry left major automakers, including General Motors , scrambling for survival.Source: Reuters: Business News | 12 Dec 2008 | 12:33 pm Stock futures sink on collapse of automakers' bailout (Reuters)
Source: Yahoo! News: Business | 12 Dec 2008 | 12:33 pm Stock futures sink on collapse of automakers' bailout (Reuters)
Source: Yahoo! News: Stock Markets News | 12 Dec 2008 | 12:33 pm Earnings Watch: Updates, advisories and surprisesA roundup of the latest corporate earnings reports and what companies are saying about future quarters.Source: MarketWatch.com - Top Stories | 12 Dec 2008 | 12:31 pm US, European interbank lending rates fall furtherThe cost of three-month dollar loans between banks fell further Friday ahead of next week's expected interest rate cut from the U.S. Federal Reserve. The interbank lending rate on...Source: Infocious RSS raw feed - channel BNewsBusiness | 12 Dec 2008 | 12:29 pm Buffett to Fuld: Heroes and zeros of 2008When it comes to money matters, 2008 served up an unusually rich cast of saints and sinners. Here is our highly subjective list of who we love and who we love to hate.Source: Business and financial news - CNNMoney.com | 12 Dec 2008 | 12:26 pm EU cushions slowdown with economy stimulus planEU leaders on Friday backed a euro200 billion ($264.3 billion) economic stimulus package to ward off recession in the region's 27 nations as new statistics highlighted just how deep a...Source: Infocious RSS raw feed - channel BNewsBusiness | 12 Dec 2008 | 12:18 pm Population growth contributes to emissions growthFew doubt the world's booming population contributes to rising carbon emissions. But as a U.N. climate conference in Poznan, Poland considers how to reduce heat-trapping, greenhouse...Source: Infocious RSS raw feed - channel BNewsBusiness | 12 Dec 2008 | 12:18 pm Auto bailout collapses in SenateThe bailout of the U.S. auto industry was in peril Friday after a compromise plan to provide $14 billion in emergency loans was rejected by the Senate overnight.Source: Business and financial news - CNNMoney.com | 12 Dec 2008 | 12:15 pm How Congress proposes to fix the 401(k)What is Washington, D.C. cooking up in response to the retirement savings crisis? With a new administration in town, there's a good chance some reforms may take place. Here's a look at four of the most discussed proposals:Source: Business and financial news - CNNMoney.com | 12 Dec 2008 | 12:14 pm Japan, EU to boost economiesLONDON (Reuters) - Japan and Europe sought on Friday to prop up their faltering economies after a $14 billion rescue package for America's top auto makers collapsed, deepening the worst financial crisis in 80 years.Source: Reuters: Business News | 12 Dec 2008 | 12:13 pm $50bn fraud charge at hedge fundA US hedge fund manager is arrested and charged with securities fraud, in one of the biggest fraud cases yet.Source: BBC News | Business | World Edition | 12 Dec 2008 | 12:06 pm Oil falls towards $45, Goldman cuts forecastLONDON (Reuters) - Oil fell toward $45 a barrel on Friday, after the collapse of a $14 billion rescue for U.S. automakers caused heavy losses across global financial markets and Goldman Sachs predicted oil could fall to $30 a barrel.Source: Reuters: Business News | 12 Dec 2008 | 12:05 pm GM shares plunge in European tradeThe carmaker's European arm said it was operating 'as usual' after the collapse in Congress overnight of a $14bn rescue bill for GM and Chrysler raised the spectre of a bankruptcy filing by the world's largest carmakerSource: Financial Times - US homepage | 12 Dec 2008 | 12:05 pm BAA airport passenger numbers tumble 8.9%A strike at Air France and the demonstrations which closed Bangkok’s international airport meant BAA’s seven UK airports handled one million fewer passengers than in the same month last year.Source: Latest Business News from Times Online | 12 Dec 2008 | 12:03 pm Goldman slashes oil price forecastsThe investment bank almost halved its forecast for next year's oil price as it warned of the impact of the global recession on demand for energySource: Financial Times - US homepage | 12 Dec 2008 | 12:03 pm Brown: EU leaders back $267B economy stimulusBritish Prime Minister Gordon Brown says EU leaders have agreed on a euro200 billion ($267 billion) economic stimulus package to rescue their recession-hit economies. He also says...Source: Infocious RSS raw feed - channel BNewsBusiness | 12 Dec 2008 | 12:01 pm Japan doubles size of rescue planThe Japanese government dramatically increases the size of its stimulus plan aimed at re-launching the country's economy.Source: BBC News | Business | World Edition | 12 Dec 2008 | 11:59 am Indications: Stock futures slump after Senate sinks auto bailout planU.S. stock market futures slump Friday after plans for a bailout of the auto industry fall apart in the Senate amid a dispute over union wages.Source: MarketWatch.com - Top Stories | 12 Dec 2008 | 11:58 am Shares fall after bail-out failsAsian and European stock markets slide after the US Senate fails to agree a $14bn bail-out package for the US car industry.Source: BBC News | Business | World Edition | 12 Dec 2008 | 11:54 am Goldman, once warning of $200 oil, sees $45 in 2009SINGAPORE/LONDON (Reuters) - Goldman Sachs' energy equity research team, which predicted a crude oil spike to $200 a barrel earlier this year, slashed on Friday its 2009 forecast to just $45 as demand deteriorates.Source: Reuters: Business News | 12 Dec 2008 | 11:51 am World markets plunge as US auto bailout fails (AP)
Source: Yahoo! News: Stock Markets News | 12 Dec 2008 | 11:51 am Ex-Nasdaq chairman arrested on fraud charge in NYC (AP)AP - A Wall Street powerbroker for nearly 50 years who built an influential firm has confessed to a massive fraud scheme that will cost investors at least $50 billion, federal authorities say.Source: Yahoo! News: Stock Markets News | 12 Dec 2008 | 11:46 am UPDATE 3-Novartis posts Phase III progress for MS drugZURICH, Dec 12 (Reuters) - Switzerland's Novartis AG said first Phase III results for its FTY720 drug showed superior efficacy to a current standard of care for patients with relapsing multiple sclerosis...Source: Infocious RSS raw feed - channel BNewsBusiness | 12 Dec 2008 | 11:45 am Pound slides closer to parity with the euroSterling fell to a new low against the euro today raising fears that it is set to reach parity with the single currency.Source: Latest Business News from Times Online | 12 Dec 2008 | 11:44 am EU: $264B stimulus planRead full story for latest details.Source: Business and financial news - CNNMoney.com | 12 Dec 2008 | 11:40 am Brown: EU leaders back euro200B economy stimulusBritish Prime Minister Gordon Brown says EU leaders have agreed on a euro200 billion ($264.3 billion) economic stimulus package to rescue their recession-hit economies. He also says...Source: Infocious RSS raw feed - channel BNewsBusiness | 12 Dec 2008 | 11:38 am CORRECT: Alcatel-Lucent to cut 1,000 jobs in strategic revampAlcatel-Lucent, the world’s largest maker of telecommunications equipment, on Friday says it plans to cut 1,000 management jobs as part of an effort to save one billion euros ($1.33 billion) over the next two years.Source: MarketWatch.com - Top Stories | 12 Dec 2008 | 11:38 am World stocks tumble as US auto bailout blocked (AFP)
Source: Yahoo! News: Stock Markets News | 12 Dec 2008 | 11:37 am Goldman Sachs (GS) Bankers Check Into Poor House
Who cares? The tidal wave carries everyone out to sea. Referring to Goldman Sachs (GS), The New York Post writes, "Everyone from the investment bank's senior executives to rank-and-file employees are expected to feel the pinch from the smaller bonus pool, with jet-setting bankers seeing their bonus shrink as much as 80 percent, while lower-level workers could see their bonuses fall by half. " Douglas A. McIntyre Source: 24/7 Wall St. | 12 Dec 2008 | 11:33 am Shares suffer after US auto bailout collapse (AFP)
Source: Yahoo! News: Stock Markets News | 12 Dec 2008 | 11:24 am Shares suffer after US auto bailout collapse (AFP)
Source: Yahoo! News: Business | 12 Dec 2008 | 11:24 am HBOS shareholders to vote on dealHBOS gives a gloomy outlook as shareholders meet in Birmingham later to vote on the takeover deal with Lloyds TSB.Source: BBC News | Business | World Edition | 12 Dec 2008 | 11:22 am Ex-Nasdaq chair arrested for securities fraudFormer Nasdaq chairman Bernard Madoff was arrested Thursday and charged with a single count of securities fraud for allegedly operating a multibillion-dollar Ponzi scheme from his investment advisory business, federal authorities said.Source: Business and financial news - CNNMoney.com | 12 Dec 2008 | 11:22 am Asia Markets: Auto stocks plunge, dragging Asia to broad-based lossesAsian markets tumble to cap off an otherwise upbeat week, as investors sold shares broadly on word that a $14 billion bailout deal to aid struggling U.S. automakers fell apart overnight.Source: MarketWatch.com - Top Stories | 12 Dec 2008 | 11:18 am Europe Markets: European shares slide as banks, oil majors, autos fallEuropean shares follow Asian stocks deep into the red on Friday morning after a $14 billion bailout package for the U.S. auto industry falls apart in the Senate, with financials and oil firms taking the brunt of the fall.Source: MarketWatch.com - Top Stories | 12 Dec 2008 | 11:17 am Delisting Roulette (NT)(F)(FNM)(FRE)(AIG)(SIRI)(JAVA)
One of the key benchmarks is that corporations cannot trade below a dollar for too long. In most cases that period is 30 days. If a firm does not comply, it usually has some time to put together a plan to fix the trouble. In many instances that involves a reverse-split. In others the companies may put together spreadsheets and documents to predict how their business will get better thereby pulling investors into their shares. Nortel (NT) disclosed that it is the latest company to be warned on its stock price. After a ton of bad news and a disclosure that it may file for bankruptcy, its stock trades at $.40. It can join a group of well-known corporations in the same boat including Sirius XM (SIRI), Fannie Mae (FNM), and Freddie Mac (FRE). Ford (F) and AIG (AIG) have gotten close to crossing the threshold and so have scores of listed companies which are not big household names. The art of the reverse stock split is an astonishingly transparent game and should hardly count as a way to get a share price back into exchange compliance. A stock trading at $.80 can cut its shares by 90% and suddenly push its price to $8. Neat trick, but cheating. Although, the exchanges do not see it that way. Sun Microsystems (JAVA) is especially adroit at the practice. The economy and stock markets are so bad off that the government and companies are constantly taking "emergency measures". Banks can hide bad assets by moving them in and out of their buildings. The Fed will lend money to almost anyone who asks. The exchanges could get into the emergency mode all on their own. There is nothing magic about $1 share price. Some institutions won't buy stocks which trade below $5, but almost no one will buy shares in a company which has been kicked from the NYSE to the pink sheets where it trades for a dime. Maybe suspending that $1 minimum for a year or so would not be such a bad idea. Douglas A. McIntyre Source: 24/7 Wall St. | 12 Dec 2008 | 11:16 am UK says Merkel backs fiscal boostUK foreign secretary David Miliband says that the German government supports a pan-European stimulus plan.Source: BBC News | Business | World Edition | 12 Dec 2008 | 11:06 am Growth fall jolts Indian economyIndia's industrial growth shrinks for the first time in more than a decade as it feels the fallout of the global credit crunch.Source: BBC News | Business | World Edition | 12 Dec 2008 | 11:01 am HBOS bad debt charge soars to $7.5 billionTroubled U.K. bank HBOS says Friday that its bad debt charge has soared over 70% to around 5 billion pounds ($7.5 billion) in the last couple of months as credit quality has deteriorated sharply and asset prices have fallen further.Source: MarketWatch.com - Top Stories | 12 Dec 2008 | 11:01 am As Fed's Assets Move Above $2 Trillion, Question Arises Of What It Is Really Worth
According to The Wall Street Journal, "Once recently announced programs to help consumer credit and mortgage markets are up and running, that figure should climb toward $3 trillion. The balance sheet was under $1 trillion as recently as mid-September." But, is that real money, or Confederate dollars? Much of what the Fed has put into its vault is paper it has taken from banks in exchange for cash. Some of those assets are probably bonds based on derivatives, consumer credit pools. and perhaps even LBO loans. The Fed is also aggressively lending money through its discount window. Average daily borrowing at that facility has been running at about $240 billion. All that money may be paid back, but in the current environment, that is not a lock. The Fed has been reluctant to disclose which financial firms are making use of its facilities. It does not want to frighten bank customers and shareholders by revealing that one or two banks are being more aggressive than others in terms of getting funds. That argument has its strengths, but it is taxpayer money. Maybe the public should have a right to know where it goes and what risks the lending carries. There may be another reason the Fed is silent about what happens inside its vaults. In a world where "mark to market" accounting still rules, the assessment of balance sheets, the value of what the Fed holds might not be set at one hundred cents on a dollar. There not many CPAs checking out how the Fed has set up its books. The value of the Fed's holdings may be much lower than reported. Douglas A. McIntyre Source: 24/7 Wall St. | 12 Dec 2008 | 10:56 am Chinese car sales hit by slowdownChinese car sales plunge and retail sales slow as the global economic slowdown catches up with the country's economy.Source: BBC News | Business | World Edition | 12 Dec 2008 | 10:47 am Dollar falls to record low against yenRead full story for latest details.Source: Business and financial news - CNNMoney.com | 12 Dec 2008 | 10:45 am Eurozone industrial output dropsEurozone industrial output falls more than expected in October, official figures show, raising fears of a pronounced recession.Source: BBC News | Business | World Edition | 12 Dec 2008 | 10:45 am Intel (INTC) Starts A Car Repair Company
Grove believes that Intel can fix the car industry along with all the PCs and servers that it makes work. At least he remains ambitious in his old age. According to The Wall Street Journal, "Former Intel Corp. chairman Andrew Grove is pushing the world's biggest maker of microprocessors to consider a new venture -- becoming a manufacturer of advanced batteries for plug-in electric cars." Aside from being completely impractical, it is a brilliant idea. Grove does not appear to want to acknowledge that companies as astute as Toyota (TM) and Honda (HMC) have not been able to unlock the problems of battery life and charging in a way that would make the electric car practical. A number of electronics companies have made efforts as well. So far, even though they are experts in their fields of stored power, no dice. Intel has enough trouble keeping up with the technology advances at AMD (AMD). Grove may be brilliant, but he is also stupid. Douglas A. McIntyre Source: 24/7 Wall St. | 12 Dec 2008 | 10:36 am Currencies: Failed auto bailout sends dollar to 13-year low vs. yenThe U.S. dollar tumbles to a 13-year low versus the Japanese yen Friday and falls against most major currencies after a $14 billion loan package for the auto industry collapses in the U.S. Senate.Source: MarketWatch.com - Top Stories | 12 Dec 2008 | 10:32 am Solid corporate bonds offering juicy yieldsBoring is beautiful - or so it feels in this time of wild and crazy stock market swings. In this case we're talking about investment-grade corporate bonds, which are dirt-cheap right now for the same reason that stocks are: The market turmoil has pounded down their prices. The result is historic opportunities in bonds issued by blue-chip companies.Source: Business and financial news - CNNMoney.com | 12 Dec 2008 | 10:31 am Airline Boarding Passes Go Mobile
First there were e-tickets. We love e-tickets. What if we didn’t have to print the dang things? American Airlines has taken air travel to a new level of digital convenience with mobile boarding passes. Electronically delivered boarding passes (to phones or PDAs) are hoped to streamline the travel process by saving the time it takes to print out and present a paper boarding pass at the airport. I don’t know about you, but it doesn’t really take me that long to print. And I can usually do something else at the same time. Although, I think the mobile boarding pass is a great backup. The system is being tested at Chicago’s O’Hare International Airport, Los Angeles International (LAX) and John Wayne Orange County (SNA) airports as well. If the airline and the United States Transportation Security Administration (TSA) deem the trial successful in trial cities, mobile boarding passes could go nationwide in a matter of months. If customers choose the all-digital option, they receive an e-mail with a link to their boarding pass. This mobile boarding pass contains a 2-D barcode that is accepted at TSA security checkpoints and at American Airlines gates by having the customer scan their cell phone or PDA screen at security and at the gate. Just remember to keep that phone charged. It’s just one more way the airlines are competing for business class fares. Maybe they’re trying to make up for blocking the porn on in-flight wifi. Source: Business Pundit | 12 Dec 2008 | 10:30 am Auto bailout failsWASHINGTON (Reuters) - A proposed bailout of U.S. automakers failed in the Senate on Thursday night, raising the specter of an industry collapse that sent Asian markets reeling and sparked fears it could deepen the recession.Source: Reuters: Business News | 12 Dec 2008 | 10:27 am The American car by the man who made General MotorsSource: Latest Business News from Times Online | 12 Dec 2008 | 10:25 am How Much Is GM (GM) Faking? The Balance Sheet Mind Game
According to The Wall Street Journal, "GM (GM) management recently tapped bankruptcy veteran Harvey Miller of the New York law firm, Weil Gotshal & Manges LP, to handle what would be one of the largest and most controversial filings in U.S. history." With the bill to send checks to The Big Three dead and in the process of being buried, getting advice for Chapter 11 is only prudent. GM should have done it weeks ago when the company's cash was not so low. It would have made operating under court protection much easier. But, GM may have that cash. According to its last available balance sheet, it had $16 billion in cash and almost $10 billion in receivables. That was offset by the $28 billion in payables it owes, but GM may have been stringing its suppliers along. Those suppliers could refuse to deliver parts, but, if the big car company makes it, they will have undermined their own opportunities to make sales and get paid for them. It would not be accurate to say that GM is misleading Congress and the media about its finances. Stretching out payments is an age-old way to preserve capital. Following tradition does not necessarily make the people at GM evil. The need to stiff parts companies is part of the supply chain management process during a recession. If GM has kept $15 million in cash and receivables, it may be able to make it to the middle of 2009 based on its claim of eating $1.5 billion in cash a month. That would allow time for the new administration to get into Washington. The new Congress may have a more sympathetic ear toward the need for a Big Three bailout. If GM is faking it, good for them. Ethics should be secondary to shareholder and employee concerns. Douglas A. McIntyre Source: 24/7 Wall St. | 12 Dec 2008 | 10:24 am Invasion Of Motor-Cars.Source: Latest Business News from Times Online | 12 Dec 2008 | 10:19 am Bank of America to shed 35,000 jobsBank of America said Thursday it plans to slash up to 35,000 jobs over the next three years as it absorbs Merrill Lynch and contends with the deepening recession.Source: Business and financial news - CNNMoney.com | 12 Dec 2008 | 10:01 am EU leaders defend climate change concessionsEuropean Union leaders defended their decision to make significant concessions to manufacturing industry under a two-track plan to fight climate change and haul Europe out of economic recessionSource: Financial Times - US homepage | 12 Dec 2008 | 9:59 am Ford's Mechanical Miracle.Source: Latest Business News from Times Online | 12 Dec 2008 | 9:52 am Bank of America to cut up to 35,000 jobsNEW YORK (Reuters) - Bank of America Corp said on Thursday it plans to eliminate 30,000 to 35,000 jobs over three years, reflecting its pending purchase of Merrill Lynch & Co and weaker business activity stemming from the economic recession.Source: Reuters: Business News | 12 Dec 2008 | 9:35 am Auto bailout fails (Reuters)
Source: Yahoo! News: Business | 12 Dec 2008 | 9:23 am Treasury sees TARP funds for financial sectorWASHINGTON (Reuters) - The Treasury Department maintains that a $700-billion bailout fund approved by Congress is best used in trying to stabilize the nation's troubled financial sector and a spokeswoman indicated on Thursday night that was unlikely to change.Source: Reuters: Business News | 12 Dec 2008 | 9:20 am Street expects gloomy retail, inventories data (AP)
Source: Yahoo! News: Business | 12 Dec 2008 | 9:13 am Treasury sees TARP funds for financial sector (Reuters)
Source: Yahoo! News: Business | 12 Dec 2008 | 9:08 am Markets tumble as auto bail-out collapsesThe dollar fell below Y89 against the yen for the first time in 13 years as investors sold off the US currency amid heightening concerns over the failed bailout of the automakersSource: Financial Times - US homepage | 12 Dec 2008 | 8:59 am HK stock index plunges on auto bailout rejection (AP)
Source: Yahoo! News: Stock Markets News | 12 Dec 2008 | 8:58 am Media Digest 12/12/2008 Reuters, WSJ, NYTimes, FT, Bloomberg
Reuters reports that the Bank of America (BAC) will cut as many as 35,000 jobs, Reuters writes that with higher jobless rates, fewer people are missing work, even if they are unhappy with their jobs. Reuters reports that the Treasury sees the $700 billion bailout fund as capital for the financial sector and not for any other part of the economy. Reuters reports that KB Toys filed for Chapter 11. Reuters reports that the solvency report on BCE is a hot topic among M&A executives. Reuters writes that the Lehman trustee will seek a probe of the firm's collapse. Reuters reports that private banks are moving offshore to take advantage of secrecy laws. Reuters reports that US video game sales were up 10%. Reuters reports that United Technologies (UTX) profits may be flat next year. The Wall Street Journal reports that famous Wall St. broker Bernard L. Madoff was accused of fraud. The Wall Street Journal reports that its survey of economists says the recession would be deeper than expected because of the consumer credit crisis. The Wall Street Journal reports that Nortel (NT) may face a delisting from the NYSE. The Wall Street Journal reports that P&G (PG) may lower its sales outlook. The Wall Street Journal reports that the ex-CEO of Intel (INTC) says the company should make advanced batteries for cars. The Wall Street Journal reports that Alcatel-Lucent (ALU) plans a change in strategic direction and more layoffs. The Wall Street Journal reports that PC company Lenovo is looking for acquisition. The Wall Street Journal writes that bank use of its credit facility has pushed assets at the Fed to over $2 trillion. The Wall Street Journal reports that data from China is sparking a deflation concern. The Wall Street Journal writes that retail data to be released by the Census Bureau may be extremely bad. The Wall Street Journal reports that several large insurance firms which pay very low taxes want access to the bailout fund. The Wall Street Journal reports that mortgage rates hit a four year low at 5.47%. The Wall Street Journal reports that the price of oil rose 10% on concerns about OPEC cuts. The Wall Street Journal writes that retailers are facing competition from liquidation sales of their rivals. The Wall Street Journal reports that Boeing (BA) is shaking up management after another delay of its 787. The Wall Street Journal reports that Costco (COST) warned about sales weakness. The New York Times reports that auto suppliers are anxious about the collapse of GM (GM) and Chrysler. The New York Times reports that "Companies whose pension funds suffered big losses this year will not have to replenish the money quickly under a relief measure that flew through the Senate." The New York Times reports that many Japanese companies are still investing in themselves. The New York Times reports that oil demand was off for the first time since 1983. The New York Times reports that the US trade deficit grew in October on a drop in exports. The FT reports that US bank shares plunged on remarks from JP Morgan's (JPM) CEO that more trouble is still ahead. The FT reports that California's debt was downgraded. The FT reports that the collapse of the BCE is fueling concerns about the future of private equity. Bloomberg reports that write-downs at UK financial firm HBOS increased to $7.5 billion. Douglas A. McIntyre Source: 24/7 Wall St. | 12 Dec 2008 | 8:53 am Chinese shares fall, joining regional rout (AP)
Source: Yahoo! News: Stock Markets News | 12 Dec 2008 | 8:52 am HBOS takes $11.9 billion hit as bad debts leap (Reuters)
Source: Yahoo! News: Business | 12 Dec 2008 | 8:46 am Global shares dive on US car deal collapseShares in London plummeted by nearly 150 points today, following the failure of US carmakers to secure a $14 billion rescue fund from the Government, raising the prospect that Chrysler and General Motors could file for bankruptcy within days.$Source: Latest Business News from Times Online | 12 Dec 2008 | 8:37 am Auto Bill Dies In Senate
Douglas A. McIntyre Source: 24/7 Wall St. | 12 Dec 2008 | 8:20 am KB Toys files for bankruptcyNEW YORK/HONG KONG (Reuters) - KB Toys Inc, one of the largest U.S. toy retailers, filed for Chapter 11 bankruptcy protection on Thursday, with a plan to close all its stores and begin liquidation sales in the middle of the holiday season.Source: Reuters: Business News | 12 Dec 2008 | 8:17 am Asia Markets And Europe Open 12/12/2008
The Nikkei fell 5.6% to 8,236. The Hang Seng was off 5.9% to 14,688. The Shanghai Composite fell 3.8% to 1,954. At the open in Europe, the FTSE fell 2.9% to 4,263. The Dax dropped 3.9% to 4,582. The CAC 40 was off 3.1% to 3,202. Data from Reuters Douglas A. McIntyre Source: 24/7 Wall St. | 12 Dec 2008 | 8:17 am ReelzChannel drops 'Dailies' showMore than 40 workers are laid off as the network responds to a slump in advertising. ReelzChannel, the cable and...Source: Infocious RSS raw feed - channel BNPaperBusiness | 12 Dec 2008 | 8:00 am Oil price surge can't last, analysts sayCurrency fluctuations and OPEC maneuvers push crude to near $50 a barrel despite low demand. Crude oil futures...Source: Infocious RSS raw feed - channel BNPaperBusiness | 12 Dec 2008 | 8:00 am Pension funding relief for businesses awaits Bush's OKCongress passes a measure that would allow employers to postpone contributions to their pension funds. Companies say they need the cash to stay afloat in the worsening recession. ...Source: Infocious RSS raw feed - channel BNPaperBusiness | 12 Dec 2008 | 8:00 am BofA expects to cut 35,000 jobsThe reductions would occur over three years. Analysts say the final number of layoffs could be higher. Bank of...Source: Infocious RSS raw feed - channel BNPaperBusiness | 12 Dec 2008 | 8:00 am Watching Sumner Redstone, the economy, and what he'll do with his movie theater chainWith the sale of his ill-fated stake in video game maker Midway out of the way, he can now focus on attracting interest from buyers for parts of National Amusements to pay down company debt. ...Source: Infocious RSS raw feed - channel BNPaperBusiness | 12 Dec 2008 | 8:00 am KB Toys, citing bleak sales, files for bankruptcy againThe privately held toy chain, which has 460 locations, has been hobbled by sharp declines in mall traffic as consumers cut back. ...Source: Infocious RSS raw feed - channel BNPaperBusiness | 12 Dec 2008 | 8:00 am U.S. farm labor rules revampedChanges that will streamline the agriculture guest worker program aren't expected to have much effect in California. ...Source: Infocious RSS raw feed - channel BNPaperBusiness | 12 Dec 2008 | 8:00 am Senate Republicans kill auto bailout billA last-ditch attempt at compromise fails, increasing the risk of bankruptcy for one of Detroit's Big Three and more turmoil for the overall economy. ...Source: Infocious RSS raw feed - channel BNPaperBusiness | 12 Dec 2008 | 8:00 am Stocks tumble on auto bailout worriesStocks fell sharply Thursday on fears -- ultimately confirmed -- that a bill to rescue two Detroit automakers would die on Capitol Hill.Source: Infocious RSS raw feed - channel BNPaperBusiness | 12 Dec 2008 | 8:00 am FDA advised to restrict some asthma drugsA special panel concludes risks for Foradil and Serevent outweigh benefits; Advair and Symbicort are deemed worthwhile. ...Source: Infocious RSS raw feed - channel BNPaperBusiness | 12 Dec 2008 | 8:00 am HBOS reveals £8bn charge ahead of merger voteShares in HBOS and its soon-to-be merger partner, Lloyds TSB, plunged today after the Halifax and Bank of Scotland owner revealed an £8 billion cost of bad debts and charges for mortgage, loan and business arrears.Source: Latest Business News from Times Online | 12 Dec 2008 | 7:44 am Japan stocks tumble on failed US auto bailout (AP)AP - Japan's benchmark stock index shed 5.6 percent Friday after a bailout of U.S. automakers collapsed in the Senate.Source: Yahoo! News: Stock Markets News | 12 Dec 2008 | 7:26 am Bernard Madoff arrested over alleged $50 billion fraud (Reuters)
Source: Yahoo! News: Business | 12 Dec 2008 | 5:40 am Bernard Madoff arrested over alleged $50 billion fraudNEW YORK (Reuters) - Bernard Madoff, a quiet force on Wall Street for decades, was arrested and charged on Thursday with allegedly running a $50 billion "Ponzi scheme" in what may rank among the biggest fraud cases ever.Source: Reuters: Business News | 12 Dec 2008 | 5:40 am China cheers ethnic Chinese pick for US energy sec (AP)
Source: Yahoo! News: Stock Markets News | 12 Dec 2008 | 5:20 am New Deal, or New Ideas?The other day, I met a man with wild, graying hair who with his wife founded Earthstone, a "green" company in New Mexico that pulverizes recycled glass and turns it into a powder that is mixed with other materials to make a soft-stone scrubber to clean patio grills.Andrew Ungerleider and Gay Dillingham tell me they are raising funds to use the same technology to produce a super-light concrete and other building materiel. In more a more benign economic era, Earthstone would raise mostly private money (sweetened with government grants and tax breaks) and would slowly scale up its new technology. But in these troubled times, investment to rapidly scale-up such new ideas is difficult, if not impossible to raise—which could mean no super-light concrete, no cutting-edge technology, no spending by Earthstone on supplies and materials, and no new jobs. Across the United States—and around the world—cutting-edge technologies are poised just like Earthstone’s to make everything from automobile and jet fuel out of algae to synthetic organisms that eat CO2 emissions. Yet most are unable to raise the money needed to test their new ideas. As President-elect Barack Obama makes plans to use massive government spending to pull us out of our economic slump, it's important that he take action to not only drive a recovery in the short term, but also to propel America again to the forefront of innovation in this new century. Two clues: It’s not just bridges and infrastructure, and it’s not thinking small. Rather, it’s science and technology. Since our ancestors first walked upright, human ingenuity has produced many wonders (and a few horrors). But more often than not, dramatic new ideas have given the edge to the clans, tribes, nations, and civilizations that embrace them. Those who failed to adopt the latest developments, whether it was the invention of the wheel or the microchip, tended to decline or to be left behind. This is why Obama needs to move quickly to implement a bold techno-push on the scale of President John F. Kennedy’s call nearly a half-century ago to put a man on the moon. Such an effort would employ not just the tech elite, but workers at all levels of education and training. It needs to go beyond his campaign promises to double the budgets over the next 10 years of the National Institutes of Health, the National Science Foundation, and other federal research-and-development agencies. It would also have to go beyond the $150 billion Obama’s promised to develop clean-fuel technologies and to create five million “green collar” jobs—and beyond the vague talk about including technological innovation as part of the stimulus package being prepared by the new administration and by members of Congress. What’s called for is a dramatic New Technology Initiative that treats New Tech as the core of a stimulus package, not as an add-on after tax rebates and short-term boosts. Such measures probably won’t coerce people drowning in debt and losing jobs to buy another iPod anyway. After implementing the stimulus package, the new president should encourage foreign leaders to create a global New Tech Deal, taking care to include concerns from all stakeholders, including emerging economies. Goals might include expanding America’s 5 million new green-collar workers to 50-million worker planet-wide, and an equivalent 10-fold increase of $1.5 trillion to create alternative and carbon-friendly fuels. Such an effort would reverse the decline in U.S. federal spending on research and development, which has fallen to its lowest level in 10 years—to less than 0.5 percent of G.D.P. The initiative would reestablish America as a world leader in science and technology. Some critics will say that the government is too incompetent or corrupt to handle such a sweeping plan. But I can give you trillions of reasons why it can’t do worse than the private sector, which has brought the world to the brink of economic collapse. In any case, we all need to acknowledge in advance that some ideas won’t work. Failure and waste will be part of the equation—as they always are, in private as well as public experiments. One critical element could be a leader who inspires people around the world to think beyond their personal gain, at least for a minute or two. In recent weeks, the media and some lawmakers have compared Obama’s talk about public works programs to jumpstart the economy and create jobs to President Franklin Roosevelt’s New Deal. In fact, a major element of F.D.R.’s Works Progress Administration—which built roads, bridges, public buildings, between 1936 and 1941—was to embrace the latest innovations of that era. The entire W.P.A. effort cost $11.5 billion in 1941 dollars—about $139 billion today. In 2008, much more is required because $139 billion doesn’t buy what it used to given current construction costs, standards and regulations. Workers also would be unlikely to labor for wages just above the welfare rate, as many did during the Great Depression. Unlike the trillions spent on bailing out the financial industry, this stimulus money will be an investment in the future—a bail-in, if you will. When Obama talks about change, let’s hope he truly means a recommitment to creativity and adaptation. Much more than our economy is at stake. This is survival.Related Links It's Unanimous: Barack Is a Lock for 'Time' POY Department of Dubious Statistics, Oil Imports Edition Carly Fiorina Source: Portfolio.com: Top 5 | 12 Dec 2008 | 5:00 am Reserve Bank to accept wider range of securitiesThe Reserve Bank is to accept an even wider range of securities in its domestic liquidity operations, citing concerns about funding to business. "Following a number of similar measures adopted earlier in the year, we are taking...Source: New Zealand Herald - Business | 12 Dec 2008 | 4:51 am Japan to unveil new stimulus package ahead of economic summitJapan’s deeply embattled Prime Minister, Taro Aso, is today expected unveil an additional Y6 trillion economic stimulus package in a last-ditch bid to rescue the world’s second biggest economy from its sharpest recessionary plunge since the Second World War.Source: Latest Business News from Times Online | 12 Dec 2008 | 4:48 am Lehman brokerage trustee seeks to probe collapseNEW YORK (Reuters) - The trustee handling the liquidation of Lehman Brothers Holdings Inc's brokerage unit asked a U.S. bankruptcy court on Thursday for the power to issue subpoenas to obtain documents and information from current and former employees and officers.Source: Reuters: Business News | 12 Dec 2008 | 1:51 am 90-day hire-and-fire bill becomes lawNew workers in small businesses can be sacked within 90 days of starting their jobs under a law passed today. The probation period may be extended to larger firms in future. Labour Minister Kate Wilkinson said the Employment...Source: New Zealand Herald - Business | 12 Dec 2008 | 1:30 am Car sales slump to lowest level since 2001Car sales have hit their lowest point since 2001. According to figures from Statistics New Zealand released today, car sales are down 19.5 per cent since September 2007. Fuel sales are also down 2.2 per cent or $14 million. The...Source: New Zealand Herald - Business | 12 Dec 2008 | 1:00 am Super Fund sells nuke, cluster bomb sharesCluster bomb makers and nuclear weapons testers are now officially off limits for the Government's $12 billion Super Fund. Formerly known as the Cullen Fund, the fund has released its list of companies it will no longer invest...Source: New Zealand Herald - Business | 12 Dec 2008 | 1:00 am Madoff faces securities fraud chargeBernard Madoff, the founder of Bernard Madoff Investment Securities and a former chairman of the Nasdaq stock market, was charged by federal prosecutors with a multibillion-dollar securities fraudSource: Financial Times - US homepage | 12 Dec 2008 | 12:47 am After The Close - ThursdayBERNARD MADOFF, founder of Bernard L. Madoff Investment Securities, was arrested by the FBI over an alleged giant Ponzi scheme.Source: Investor's Business Daily: BUSINESS | 12 Dec 2008 | 12:41 am Trends & Innovations - ThursdayDMV photos, now even less funSource: Investor's Business Daily: BUSINESS | 12 Dec 2008 | 12:41 am Homeowner Options: Buy, Sell Or Hold?From 2000 to 2006, home prices rose 50%. Then they imploded, leaving homeowners deep in debt and short on value.Source: Investor's Business Daily: BUSINESS | 12 Dec 2008 | 12:41 am In Brief - ThursdayAmerisourceBergen (ABC), a drug distributor, backed its '09 EPS and revenue outlooks, which are in line with Wall Street views. Its shares rose 5.8%.Source: Investor's Business Daily: BUSINESS | 12 Dec 2008 | 12:41 am Business Briefs - ThursdayU.S. Bancorp falls on loan losses. Shares of U.S. Bank's parent fell 10% after the firm said it's setting aside more than $1 bil in Q4 to cover...Source: Investor's Business Daily: BUSINESS | 12 Dec 2008 | 12:41 am Defense Contractor Beefs Up Intelligence Work With AcquisitionStanley is no stranger to the acquisition game.Source: Investor's Business Daily: BUSINESS | 12 Dec 2008 | 12:41 am Hellaby shares slump after profit warningShares in investment company Hellaby Holdings have fallen 14 per cent in early trade today after the company warned about the possible impact on its result of the economic downturn. When the sharemarket opened, Hellaby shares were...Source: New Zealand Herald - Business | 12 Dec 2008 | 12:30 am US bank shares plunge after Dimon warningJamie Dimon, JPMorgan Chase's chief executive, prompted a sharp fall in US financial shares with a warning that his bank was having a tough fourth quarter after a 'terrible' November and DecemberSource: Financial Times - US homepage | 12 Dec 2008 | 12:26 am Bank of America to cut up to 35,000 jobs (Reuters)
Source: Yahoo! News: Business | 12 Dec 2008 | 12:22 am Cemex tumbles as it fails to refinance debtThe Mexican cement group saw its shares tumbled 18% after it failed to refinance a large slice of its debt because of the financial crisisSource: Financial Times - US homepage | 12 Dec 2008 | 12:07 am Portugal offers asylum to Gitmo detaineesPortugal has offered to grant asylum to Guantanamo prisoners in a move that could help the incoming Obama administration accelerate closure of the controversial detention campSource: Financial Times - US homepage | 11 Dec 2008 | 11:48 pm Stay-at-home holidays boost local tourism as petrol fallsA surge in the number of Kiwis holidaying at home has boosted guest nights in commercial accommodation into positive territory for the first time in six months. Statistics New Zealand figures show domestic guest nights were up...Source: New Zealand Herald - Business | 11 Dec 2008 | 11:30 pm Hear: A Broker In Amish Country
Click to view. David Gilkey/NPRYou've been asking for good news. We've got it, or at least what passes for it, today on Planet Money: -- Will Aston-Reese, a money trader with Tradition Asiel Securities in New York, says he sees signs of thawing in the credit markets. He does! He does! -- The Old Order Amish of Lancaster County, Penn., almost never use credit. The one exception is when they buy a farm, and for that they turn Bill O'Brien. The mortgage broker says he has never lost money on an Amish deal, though he does put a thousand miles a week on his car. After the jump, a letter from someone who's doing OK. Download the podcast; or subscribe. Intro music: Rufus and Chaka Khan's "Tell Me Something Good." Find us: Twitter/ Facebook/ Flickr. David writes: Well, I thought it over with my wife and we recognize that we personally are doing well. We both have secure jobs that pay well -- which is helpful since we have three girls. But only the youngest is in daycare. Ultimately, we are trying to "spread the wealth around" to the less fortunate. We've written more checks to different charities this year, but with smaller amounts, $10. Also, my parents and siblings were trying to find ways to make it less expensive buying gifts for each other and for the nieces and nephews when we gather together on Christmas week. Expenses can compile very quickly. We quit flying for Christmas a while back when too many kids meant too many airline seats to pay for. But with an 11 month old, driving from Ohio to Georgia will mean stops at hotels going down and coming back. But we don't really travel much at other times of the year. We decided to get one big family gift (a Nintendo Wii) for everyone rather than lots of smaller things. But so many people can't even do that. So, ultimately, we are trying to limit expenses when possible, but we are trying to find better ways to help others also. » E-Mail This » Add to Del.icio.us Source: NPR Blogs: Planet Money | 11 Dec 2008 | 11:03 pm Air NZ ignores Govt's Kiwisaver cutThe Government's halving of compulsory company contributions to KiwiSaver is not being taken up by a major government-owned business. Air New Zealand was one of the first companies to immediately commit to a 4 per cent contribution...Source: New Zealand Herald - Business | 11 Dec 2008 | 11:00 pm NZ Shares: Market slips after sharp fall in USThe New Zealand sharemarket slipped in early trading, after stocks tumbled late in the United States as investors worried about the fate of the auto bailout. In this country Hellaby Holdings was down 20c, or 13.8 per cent, to ...Source: New Zealand Herald - Business | 11 Dec 2008 | 10:58 pm California's debt downgraded amid budget crisisCalifornia prepared to suspend $5bn in financing for schools, roads, power projects and levee repairs as the state's mounting budget crisis led Standard & Poor's to downgrade some of its short-term debtSource: Financial Times - US homepage | 11 Dec 2008 | 10:42 pm Knell Says Sesame Street Able to `Withstand' RecessionsSource: Bloomberg - All Podcasts | 11 Dec 2008 | 10:10 pm Facing Concerns About It Future, Bank Of America (BAC) To Cut 35,000 Jobs
Bank of America (BAC) will cut 35,000 jobs over the next three years. According to the company,"The reductions are coming from both companies and affect all lines of business and staff units." B of A is not even certain where the cuts will come, which makes the announcement something of a puzzle. The firm says it has overlap from the Merrill Lynch (MER) purchase and knows it is facing an extremely tough economy. The press release says,"While both factors will result in the elimination of positions, the company has not completed its analysis. Bank of America expects to have a final plan early in 2009 and estimates it will project the reduction of approximately 30,000 to 35,000 positions over the next three years. A final number will not be determined until early 2009." One theory about making the disclosure at this point when the bank itself is not sure of the details is that Wall St. is still concerned about whether all of the large money center banks will make it. Many analysts think there are still tens of billions of dollars in losses coming from credit cards, auto loans, LBOs, and further write-downs in derivatives tied to housing and consumer credit. Bank of America may want to give the appearance the it is getting out in front of those problems by chopping heads. Investor concerns about the viability of BAC are fairly clear. Its shares are down 50% in the last 90 days. The stock now trades at just under $15, down almost as much as Citigroup (C) over the last three months but much more than Wells Fargo (WFC) and JP Morgan (JPM). BAC needs to convince Wall St. that it is one of the large financials which is going to survive. Douglas A. McIntyre Source: 24/7 Wall St. | 11 Dec 2008 | 10:08 pm Barclays Fuhr Says ETFs Trading Volumes Up In 2008Source: Bloomberg - All Podcasts | 11 Dec 2008 | 10:07 pm Collapse of BCE plan fuels private equity industry concernFear of financial 'Armageddon' is starving private equity of funds, one investor warned, after the collapse of the $41bn takeover of Canada's BCE telecommunications group marked a low for the industrySource: Financial Times - US homepage | 11 Dec 2008 | 10:06 pm VIX Index of U.S. Stock Option Prices Advances 0.1% to 55.78Source: Bloomberg - All Podcasts | 11 Dec 2008 | 10:05 pm Stupid Crimes of the Week, ContinuedThis week, we've seen three examples well-known, successful professionals being charged with committing absolutely mind-bogglingly stupid crimes.Rich white men throwing it all away for nothing. It's officially a trend. First, we witnessed the New York lawyer Marc Dreier being arrested after impersonating another lawyer in what has to be one of the most bizarre and fascinating fraud cases in recent history. Charged with swindling hedge funds out of hundreds of millions of dollars, Dreier was denied bail on Thursday after prosecutors called him "an enormous risk of flight." Then we had Chicago. Oh, Chicago, your corrupt politicians never cease to captivate the country! Governor Rod Blagojevich was charged with brazenly soliciting bribes in his quest to fill the Senate seat vacated by President-elect Barack Obama. And now, we have Bernie Madoff. The president of Bernard L. Madoff Investment Securities, the 70-year-old Wall Street trader was arrested by the F.B.I. and charged with securities fraud late Thursday. The fraud allegedly totaled over $20 billion. The details are still emerging, but the Wall Street Journal's description fits the week's crazy criminal trend perfectly. The criminal complaint filed against Mr. Madoff alleges that he told senior employees Wednesday that his business was "a giant Ponzi scheme," according to a person familiar with the matter. The alleged scheme involved tens of billions of dollars, but the extent of investor losses wasn't immediately clear.You read that right. When the boss comes in and says "Take your bonus now before the Feds get it instead," you know something is amiss. Madoff's name is best known in trading circles on Wall Street, as his firm is one of the biggest market-makers in town. But the Journal reports that Madoff operated the so-called Ponzi scheme in his firm's asset management business, which managed money for institutions and high-net-worth clients. "Bernard Madoff is a longstanding leader in the financial-services industry," Madoff's defense lawyer Dan Horwitz told Bloomberg. "We will fight to get through this unfortunate set of events." Unfortunate, indeed. While the lawyers at Dreier L.P. are deciding whether or not to bother coming into work anymore, and the employees in the Illinois capitol hang their heads in shame, the traders at Madoff are now facing an especially ugly holiday season. Related Links Stocks Sink, While Oil Climbs Seeking Direction Amid Anxiety The Bizarre Fall of a Lawyer Source: Portfolio.com: Top 5 | 11 Dec 2008 | 10:00 pm Finance committee chairman no stranger to scrutinising the booksFormer investment banker and Hawkes Bay MP Craig Foss will be keeping a close eye on the Government's books as chairman of the finance and expenditure select committee. Foss, 45, was appointed to the role on Wednesday after holding...Source: New Zealand Herald - Business | 11 Dec 2008 | 9:30 pm Olympics: IOC can weather economic storm, says RoggeSWITZERLAND - IOC president Jacques Rogge today said the Olympic body is in a good position to survive the global financial crisis, and urged US Olympic officials to finalise a revised revenue-sharing deal by March - an...Source: New Zealand Herald - Business | 11 Dec 2008 | 9:00 pm Director Polanski Asks Court to Dismiss 30-Year-Old Sex CaseSource: Bloomberg - All Podcasts | 11 Dec 2008 | 8:56 pm Mattel Wins Order Barring Sales of MGA Bratz DollsSource: Bloomberg - All Podcasts | 11 Dec 2008 | 8:55 pm Altria Punitive-Damages Case Divides U.S. High CourtSource: Bloomberg - All Podcasts | 11 Dec 2008 | 8:54 pm The Worry FactorA new Pew poll suggests that affluent folks are cutting back even though their finances haven't really been effected yet. "Worry is the overwhelming factor in spending cutbacks being made by more affluent consumers," the report says. There is some good news. The survey found people are still relatively optimistic about the economy long-term, "the current psychology of bad times notwithstanding." » E-Mail This » Add to Del.icio.us Source: NPR Blogs: Planet Money | 11 Dec 2008 | 8:25 pm Emotional RescueJune 2009: That's the average date given by economists for the end of the downturn, in a new survey published by the Wall Street Journal. Never mind that the headline is "Outlook Darkens as Recession Deepens." I'm living for that June 2009 bit, rightly or wrongly. How about this from the Journal: "The downturn would be deeper still, in our view, were it not for an ultra-aggressive combination of monetary and fiscal stimulus that will soon move into high gear," Morgan Stanley economists Richard Berner and David Greenlaw said in a research note. "Authorities are pulling out all the stops: Quantitative easing by the Fed and the largest-ever fiscal stimulus package likely will promote stability in the economy late in 2009 and a moderate recovery in 2010." » E-Mail This » Add to Del.icio.us
Source: NPR Blogs: Planet Money | 11 Dec 2008 | 7:54 pm Levkovich Says `Rebuilding' of Stock Market `Coming Together'Source: Bloomberg - All Podcasts | 11 Dec 2008 | 7:39 pm Seeing some bright spots in real estateBrett White, CEO of commercial real estate firm CB Richard Ellis, tells Kai Ryssdal that while there's no question things are bad in commercial real estate, they're not all that bad.Source: Marketplace | 11 Dec 2008 | 7:24 pm Simpson Says `Evidence' Against Blagojevich Is `Overwhelming'Source: Bloomberg - All Podcasts | 11 Dec 2008 | 7:04 pm Advice For A Young BankerIn a recent column for Bloomberg, Michael Lewis offers his advice to a young banker thinking about leaving a well-known New York bank.
Anyone else feeling like this banker -- considering a career change? » E-Mail This » Add to Del.icio.us Source: NPR Blogs: Planet Money | 11 Dec 2008 | 6:44 pm Grim and GrimmerNo matter how low economists set their expectations these days, it seems that the economy can still find a way to disappoint them.Today's litany began this morning, when the Labor Department said that the number of people filing their initial claim for unemployment insurance—that is, people who've just lost their jobs—jumped to a 26-year high last week. Economists had forecast that 520,000 people would file initial jobless claims, itself a historically high number. But the actual number came in at 573,000—10 percent higher. Even using a four-week moving average to smooth out week-to-week spikes, claims were at a 26-year high. Not only are more people losing their jobs, but those who did so in the past have to spend more time to find a new position. The number of people collecting benefits for more than one week climbed more than 8 percent last week, to 4.4 million. That is the largest weekly increase since 1974. But wait! There's more! The Federal Reserve reported today that household net worth—the difference between the value of each household's assets and liabilities—declined by 4.7 percent in the three months ending September 30. That drop in household net worth is accelerating. The figure, which can suggest trends in consumer decisions about spending and investing, fell 0.7 percent in the second quarter. It grew 0.1 percent in the third quarter of 2007. At the same time, U.S. exports slumped unexpectedly in October, the Commerce Department said today. Economists said the change—which they attributed to a stronger dollar and slower economic growth abroad—is an ominous omen for next year. "This would eliminate one of the largest positives to U.S. growth the past couple of years," Briefing.com said.Related Links The Crunch Is Becoming a Crisis Trade Gap Swells What Weak Dollar? Source: Portfolio.com: Top 5 | 11 Dec 2008 | 6:30 pm Boys & Girls Club hit hard by economyNonprofits are struggling to stay afloat in these tough times. Kai Ryssdal visits the Los Angeles Boys & Girls Club to see how the organization is coping with the economic downturn.Source: Marketplace | 11 Dec 2008 | 6:24 pm Use capitalism to do good worksDoes an organization dedicated to serving society have to be a nonprofit? Commentator Dan Pallotta says charities could likely do more by using the tools of capitalism.Source: Marketplace | 11 Dec 2008 | 6:22 pm Why bubbles are so hard to seeThe current financial crisis should teach Wall Street a few lessons. But Wall Street insider Henry Blodget tells Kai Ryssdal why the meltdown has happened and why it could happen again.Source: Marketplace | 11 Dec 2008 | 6:20 pm Got a pink slip? It's time to partyFor laid-off Wall Street workers, attending a Pink Slip Party is both an opportunity to mingle with other job seekers and a chance to maybe land a new job. Amy Scott reports.Source: Marketplace | 11 Dec 2008 | 6:19 pm Bailout for Big 3 hits Senate jamSenate Republicans put the auto industry bailout plan on hold, so where do the Big Three go from here? Alisa Roth reports on the different paths the automakers can travel.Source: Marketplace | 11 Dec 2008 | 6:16 pm Gas prices low while oil imports highThe U.S. trade gap widened in October because of a record rise in the amount of oil imports. What does that mean for gas prices? Sam Eaton reports.Source: Marketplace | 11 Dec 2008 | 6:15 pm Former Kentucky player accused of mortgage fraud (AP)AP - Former Kentucky basketball player Dirk Minniefield has been charged in an alleged $10 million mortgage scheme in the Houston area.Source: Yahoo! News: Business | 11 Dec 2008 | 6:00 pm A Bailout CounterOur pals over at the Big Money just launched a new Bailout Watch shazam-o-meter. Those flying billions can be awfully hard to track. At least now you can watch them go by in soothing colors. » E-Mail This » Add to Del.icio.us Source: NPR Blogs: Planet Money | 11 Dec 2008 | 5:51 pm DeKaser Sees `Powerful' Policy Response to Economic WoesSource: Bloomberg - All Podcasts | 11 Dec 2008 | 5:42 pm Analyst Ben Dell Sees `Triple Digit' Oil Prices by 2011Source: Bloomberg - All Podcasts | 11 Dec 2008 | 5:41 pm German Automakers Are Hurting, TooAmerica's Big Three aren't the only ones having a tough time of it. The German auto industry is in crisis too. Sales in Germany have crashed to their lowest level since 1990, so automakers are halting production and shutting down factories to save money. BMW and Daimler have seen their stock plunge 25 percent and are doling out "extended vacations" to employees. Even Volkswagen, which has a strong product line generally regarded as best suited for surviving the crisis, has extended the Christmas break by five days to cut costs. The situation is hardly comparable to what's happening in Detroit, but still the outlook for German car manufacturers isn't good. "Export and production will drop significantly," Mathias Wissmann, president of the German Association of the Auto Industry, told Reuters. "The situation on global passenger car markets is dramatic." Unlike Washington, Berlin has so far refused to step in, and some say its refusal to grant significant aid to ailing industries is exacerbating the problem. The government has spent a mere $5 billion to help Germany's $3.2 trillion economy. So minuscule a sum in comparison to the $700 billion check that Congress wrote has some in Germany accusing Chancellor Angela Merkel of dragging her feet. She's under mounting pressure to do something revive the economy and back a $2.5 trillion stimulus package put together by leaders of the European Union. Many in Germany's automotive industry blame their predicament largely on a drop in sales and don't know what to do if the government doesn't step in. But German Finance Minister Peer Steinbrück has slammed the bailout mindset, telling The Telegraph, "Europe's is not on the brink of collapse . . . Just because all the lemmings have chosen the same way doesn't make it automatically right." Such comments have done little to comfort the bosses at VW, Daimler and BMW who have gone as far to support a bailout of Detroit. It's counterintuitive, but the Germans have no interest in seeing their competitors go down. "You can't underestimate what would happen when a large player collapses," BMW CEO Norbert Reithofer told Bloomberg. "That would impact the supplier structure and therefore the entire industry." The German automakers who build cars in North America get a lot of their parts from the same companies that supply Detroit. Many of those suppliers would be hard hit, if not crushed entirely, by the collapse of an American automaker. As a result, the shock wave brought about by a collapse of one or more of the Big Three would delay the German auto industry's recovery. Lawmakers from the southern states where most European car companies have factories agree the fall of Detroit wouldn't do BMW, Daimler or VW any good, but they still oppose bailing out Detroit. Republican Sen. Lindsey Graham Rep. of South Carolina (where BMW has a plant) says Detroit is "doomed." Republican Sen. Richard Shelby of Alabama (where Mercedes has a plant) says he has "little faith" The Big Three won't keep asking for money. And Republican Sen. Bob Corker of Tennessee (where VW is building a plant) says he is "disappointed" with the rescue plan. Still, it looks like Congress might throw Detroit a $14 billion lifeline to keep it afloat until the Obama Administration can wade into the mess. The proposal includes the appointment of a "car czar" to restructure the domestic auto industry. You can bet the German automakers will be paying close attention to how the deal plays out and what the car czar does to Detroit. Given the state of the world economy and the German auto industry, BMW, Daimler and VW could be formulating their own restructuring plan before long. Related LinksShowing New Colors Detroit Needs a Miracle AMI Chief Asks Employees to Back Auto Bailout Source: Portfolio.com: Top 5 | 11 Dec 2008 | 5:30 pm Under The Tree
2 toothbrushes, 1 bag of rice, cans of food, light bulbs and car oil. Emily KeownEmily from Madison, Wis. wrote to tell us how the economy has affected her gift giving: In April my husband and I made the decision to leave our jobs and move from the East Coast to the Midwest so he could go back to school for his PhD. We bought a house and imagined I would find a job without too much problem, 6 months later I have received over 110 rejection letters, I work 3 part time jobs, and do freelance work. He brings in a modest stipend from his program. We are in a place we couldn't have imagined. While I have a part time job as a college professor (which was my previous career) no place is able to hire full time so I work for just over minimum wage at a gallery hanging art work, and at nights I dawn a dirndl and serve beer in boot shaped glasses. We are very fortunate to have learned early on that credit cards are not your friends and you do need to save at least a dollar each paycheck, we are running out of ways to be frugal and it is killing our spirits. Our Christmas solution, wrap everything! In addition to the fresh supply of socks my husband gets each year he is going to be getting toilet paper, tooth paste, soap and floor cleaner, I already see a lump under the tree for me that feels suspiciously like a bag of rice. Our two extravagant gifts will be a gym membership, one we can budget for now that our insurance will reimburse us up to $200, and a restaurant gift card that has a deal by $100 get $25 free, we will use that for our big date nights to come. We are doing what we need to do to get by; our goal is to make all our payments on time, and to not depend on credit cards. Listening to your podcast and this American life I realize that these are no small feats. We are learning to live slimmer we are postponing starting a family till I work less and we are being thankful that each month we come out a little bit a head. » E-Mail This » Add to Del.icio.us Source: NPR Blogs: Planet Money | 11 Dec 2008 | 5:10 pm Topsy-Turvy Ad World“There's no earthly way of knowing, which direction we are going," Willy Wonka says while rowing down the chocolate river in Roald Dahl's children's classic Charlie and the Chocolate Factory. Now the ad industry is right there with him.General Motors' advertising budget for the first nine months of 2008 rose 15.7 percent, according to a report released Thursday from market research company TNS Media Intelligence. Meanwhile, U.S. advertisers spent just 7 percent more on Internet display ads over the year before, and growth rate for Internet display advertising have been falling for five consecutive quarters. G.M.'s budget is growing, while the Internet's revenue is slowing! "Are the fires of hell a-glowing? Is the grisly reaper mowing? Yes, the danger must be growing!" Wonka says, echoing the state of the current economy. According to TNS, G.M. spent $1.6 billion on U.S. media through September of this year. That's up from $1.4 billion over the same period in 2007. Caveat: the automaker had been dropping its spending over the past three years, so the rise just brings G.M. back to its spending level in early 2006, according to TNS senior vice president Jon Swallen. "They basically this year have pulled out all stops on marketing in order to try and move inventory," Swallen said. "You have to wonder going forward, can they sustain this?" What constraints might government put on their advertising budget? Should taxpayers pay for advertising to persuade them to buy cars made with their own money? Should they pick up the tab for Mary J. Blige's appearance in a Chevy commercial? Now to the other side of today's Twilight Zone economy: the slowing growth of Internet advertising. This is occurring despite the fact that the Internet allows marketers to target very specific groups of consumers, provides more data on the performance of an ad than other media, and tends to be less expensive. These qualities should benefit the medium during a downturn. But TNS' numbers aren't the only ones showing a slowdown in Internet ads with images and slick design. "Display is suffering because many of the vertical industries—such as auto and retail—that are key players for the format are slashing their ad budgets," the research firm eMarketer reported earlier this month. In August, eMarketer predicted 16.9 percent growth in display ad spending, but the new predictions show slower growth, at 3.9 percent. Swallen, of TNS, said the lower Internet figure is an ominous sign for everyone. "The slowdown is getting broader at the same time that it's getting deeper," he said. Over all, TNS reports, advertisers spent 1.7 percent less on advertising in the first nine months of 2008 than in the same period of 2007. For the third quarter alone, spending was down 2 percent from the year before. Yes, the danger is definitely growing. Related Links Online Ad Revenue Up Why Increase in Online Ad Spending Hurts Print Publishers Online Ad Spending: It's Ugly Out There Source: Portfolio.com: Top 5 | 11 Dec 2008 | 5:00 pm It's A Round World After AllA number of you have asked about the situation in South Korea, so we'll start there today. And where do we end? With job cuts in West Virginia, after the jump. From the Korea Herald: Central bank cuts rate to record low/ Turbulence rocks financial sector. From the Straits Times: EU to tackle stimulus plan. From the Detroit Free-Press: House OKs aid for automakers; Senate picture hazy/ Why are these GOP senators unhappy with auto aid? From Bloomberg: U.S. trade deficit widens as exports decrease/ U.S. jobless claims hit 26-year high. From the Wall Street Journal: The new mattress stuffers/ IEA expects world oil demand to contract. From the San Jose Mercury News: UCLA economists predict worsening picture in 2009/ Yahoo slashes 1,500 jobs. From the Wheeling, W.V. News-Register: Steel plant to lay off 90. » E-Mail This » Add to Del.icio.us Source: NPR Blogs: Planet Money | 11 Dec 2008 | 2:42 pm Hank Paulson, Criminal?
Nobel Peace Prize-winning economist Joseph E. Stiglitz has an excellent summary of the dynamics behind the financial crisis in Vanity Fair. I wanted to cite the following passage (paragraph breaks are my own), because it’s a serious implication of Hank Paulson: The original proposal by Treasury Secretary Henry Paulson, a three-page document that would have provided $700 billion for the secretary to spend at his sole discretion, without oversight or judicial review, was an act of extraordinary arrogance. He sold the program as necessary to restore confidence. But it didn’t address the underlying reasons for the loss of confidence. The banks had made too many bad loans. There were big holes in their balance sheets. No one knew what was truth and what was fiction. The bailout package was like a massive transfusion to a patient suffering from internal bleeding—and nothing was being done about the source of the problem, namely all those foreclosures. Valuable time was wasted as Paulson pushed his own plan, “cash for trash,” buying up the bad assets and putting the risk onto American taxpayers. When he finally abandoned it, providing banks with money they needed, he did it in a way that not only cheated America’s taxpayers but failed to ensure that the banks would use the money to re-start lending. He even allowed the banks to pour out money to their shareholders as taxpayers were pouring money into the banks. If Stiglitz is right, the media has been glazing over the severity of Paulson’s missteps. Stiglitz’s opinions do tend to run counter to mainstream verbiage–for example, he was one of the few experts who said this crisis would be as bad as the Great Depression, or worse–but he’s far too sound to dismiss as a left-wing doomsdayer. When the bailout bill passed, it did so under a valence of desperation. We needed something. But I’m starting to think there’s an indictable offense nestled somewhere in Paulson’s behavior. I don’t say this as a partisan. There could be a serious offense in Obama’s campaign contributions, too. I say this as someone who thinks she smells a rat. Thoughts? Source: Business Pundit | 11 Dec 2008 | 12:59 pm Walmart Sells Whale Meat in Japan
Walmart committed to cutting energy usage and reducing waste last year, but the retail giant has a long way to go before it can be called “green.” Taking dubiously-produced whale meat off the shelves would be another step in the right direction (from the New York Whale and Dolphin Action League): Did you know retail giant Wal-Mart is also in the business of selling endangered whale meat? A Wal-Mart-owned Japanese-based supermarket, Seiyu, Ltd., offers the meat of whales hunted in violation of the International Whaling Commission under the self-appointed guise of “scientific whaling.” Scientific whaling, which reports on the stomach and fecal contents of hundreds of the same species of whales (in the same waters, year after year,) is considered by non-whaling nations a ruse to market whale meat for purchase. Japanese whaling fleets still kill hundreds of dolphins and whales annually. Japanese officials have recommended that pregnant women and children avoid eating whale meat yet still permit this highly toxic product, the object of ongoing international protest, on its supermarket shelves. Seiyu is a major distributor of whale products and thus is instrumental in the ongoing illegal whaling and drive fishery slaughter. On the shelves of Wal-Mart’s book section one finds books on the illegal trade in whale products and the struggle to stop commercial whaling in Japan. Yet the world’s largest retailer has done nothing to stop the sale of whale meat in its Japanese stores. Yuck. Source: Business Pundit | 11 Dec 2008 | 12:45 pm
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Anyone curious about the health of the financial services industry got a look this afternoon.
