KPMG offers staff unpaid leave or four-day weeks

KPMG is asking its 11,000 British staff to take unpaid leave or face an extensive redundancy programme.
Source: Latest Business News from Times Online | 17 Jan 2009 | 10:11 pm

Bank bailout: Get ready for next phase

It's back to square one.
Source: Business and financial news - CNNMoney.com | 17 Jan 2009 | 1:37 pm

Throw Citi and BofA out of Dow!

There used to be a time when investors didn't have to worry about the financial health of companies in the Dow Jones industrial average.
Source: Business and financial news - CNNMoney.com | 17 Jan 2009 | 1:29 pm

Building A $1 Trillion "Bad Bank" (C)(BAC)(WFC)(JPM)

The federal government really does not want to build a "bad bank" to take toxic assets from America's largest financial institutions. It has taken a number of measures to avoid it.

The Fed has passed tens of billions of dollars of loans to banks and brokerages through its emergency lending window. It has lowered interest rates to zero. Treasury has put $25 billion into each of the money center banks. It is now backing over $300 billion in bad assets held by CItigroup (C) through a loss-sharing agreement. Bank of America (BAC) is getting a similar deal. The programs to back bad assets is almost certainly going to spread.

Over the last several days, the incoming administration has moved toward the idea of creating one federal agency which would have the purpose of taking most of the toxic assets off bank balance sheets. Since the figure at Citi is probably at least as large as the $300 billion pool that the government is guaranteeing, the combination of bad paper from Bank of America, Wells Fargo (WFC), JPMorgan (JPM), and the next tier of large US banks is almost certainly close to $1 trillion.

The sponging up of all these toxic assets takes the discussion back around to what the government gets in return for such colossal aid. The largest American banks had market capitalizations of as much as $300 billion each two years ago. The purchase of bad assets when stock values were at those levels would have kept shareholder dilution at a reasonable level. The government would have gotten shares for taking the junk off bank books and putting it into its new "bad bank" agency.

Those market cap figures are now closer to $40 billion for each of the four largest banks. A one trillion assistance package has to create some value for taxpayers. A stake in the banks would seem to be the only options whether it is through senior debt or equity.

Whatever the solution, the needle come back around to pointing to the a nationalization of the American banking system. There is too little equity left in the banks for them to trade for government assistance.

Douglas A. McIntyre

Source: 24/7 Wall St. | 17 Jan 2009 | 1:08 pm

Personal Finance Daily: The week's 10 best Personal Finance stories: Jan. 12-16

In case you missed them, here are the top 10 Personal Finance stories from MarketWatch for the week of Jan. 12-16:

Source: MarketWatch.com - Top Stories | 17 Jan 2009 | 1:01 pm

Gas crisis talks held in Moscow

Ukraine's prime minister and European officials traveled to Moscow on Saturday for talks aimed at restoring Russian natural gas supplies to Europe after a damaging 11-day halt in deliveries
Source: RSS feed - channel BNewsBusiness | 17 Jan 2009 | 12:35 pm

Report: German economy could shrink by 2.5 percent

The German economy, Europe's biggest, could shrink by as much as 2.5 percent this year, the country's economy minister was quoted as saying Saturday. Germany went into recession in last...
Source: RSS feed - channel BNewsBusiness | 17 Jan 2009 | 12:07 pm

Auto Review: 2009 Volkswagen CC: Comfort and class, and a luxury price

If you can handle the price, the Volkswagen CC is both a comfortable luxury car that will pamper you for days down the interstate and a jazzy looking set of wheels to be seen in around town.

Source: MarketWatch.com - Top Stories | 17 Jan 2009 | 11:01 am

Auto Review: Things you should know, final thoughts from the Detroit Auto Show

As the North American Auto show ended for the press, and now begins for the public, I thought some final tongue-in-cheek thoughts were in order for the show, the industry and the people who love to drive.

Source: MarketWatch.com - Top Stories | 17 Jan 2009 | 11:01 am

Citigroup splits in two, BofA gets government aid

NEW YORK (Reuters) - Citigroup Inc plans to split into two units and Bank of America Corp took $20 billion in government aid after the two banks suffered huge quarterly losses from the worsening credit crisis.
Source: Reuters: Business News | 17 Jan 2009 | 10:51 am

Gas crisis talks set for Moscow

Ukraine's prime minister and EU energy officials are traveling to Moscow for talks aimed at restoring Russian natural gas supplies to Europe. Ukrainian Prime Minister Yulia Tymoshenko...
Source: RSS feed - channel BNewsBusiness | 17 Jan 2009 | 10:17 am

Venture capitalists abandon 'spend mentality'

Mirroring a national trend, investment in Southern California start-ups hit a wall in the fourth quarter of 2008 and was down for the year. ...
Source: RSS feed - channel BNPaperBusiness | 17 Jan 2009 | 8:00 am

Circuit City to close remaining 567 stores in U.S.

The failure of the No. 2 electronics retailer means the loss of 34,000 jobs. The news comes as firms including Hertz, ConocoPhillips and AMD announce big job cuts. ...
Source: RSS feed - channel BNPaperBusiness | 17 Jan 2009 | 8:00 am

Bank shares plunge on fresh losses

BofA's profit streak ends. Citi's breakup will continue. An index of industry shares falls 21% for the week. Two...
Source: RSS feed - channel BNPaperBusiness | 17 Jan 2009 | 8:00 am

With stimulus, there's more bang in each buck

Tax cuts are less likely than direct government outlays to quickly spur demand, many economists say. The $825-billion...
Source: RSS feed - channel BNPaperBusiness | 17 Jan 2009 | 8:00 am

U.S., Peru reach free-trade accord

INTERNATIONAL
Source: RSS feed - channel BNPaperBusiness | 17 Jan 2009 | 8:00 am

Wall Street rebounds from news of banks' multibillion-dollar losses

The Dow slides after Citigroup and Bank of America release their quarterly results, but then climbs nearly 69 points to finish at 8,281. For the week, the blue-chip index was down 3.7%. ...
Source: RSS feed - channel BNPaperBusiness | 17 Jan 2009 | 8:00 am

Chrysler Financial gets $1.5-billion TARP loan

The Treasury Department says the five-year loan to the automaker's lending arm, drawn from the $700-billion financial bailout fund, is intended to spur car loans. ...
Source: RSS feed - channel BNPaperBusiness | 17 Jan 2009 | 8:00 am

Microsoft ordered to stop bundling Internet Explorer browser in Europe

The EU says the packaging of the IE browser with the Windows operating system violates antitrust rules. It orders changes to allow fair competition. ...
Source: RSS feed - channel BNPaperBusiness | 17 Jan 2009 | 8:00 am

If Plan B to save banks fails, try Plan A again

Despite huge capital injections, banks still struggle with losses and lending is paralyzed. The bailout's next phase may be taking toxic loans off their hands. ...
Source: RSS feed - channel BNPaperBusiness | 17 Jan 2009 | 8:00 am

U.S. could be no-show at 2010 Shanghai World's Fair

Fundraising for the American exhibit suffers from a lack of interest and the recession. International relations could be affected. ...
Source: RSS feed - channel BNPaperBusiness | 17 Jan 2009 | 8:00 am

FDIC shuts down banks in Illinois and Washington

The Federal Deposit Insurance Corporation and state regulators have shut down banks in Illinois and Washington -- the first bank failures of the year and the 26th and 27th since the start of the current credit crisis.

Source: MarketWatch.com - Top Stories | 17 Jan 2009 | 6:57 am

Canada headed toward 'very significant deficits:' Harper

Canadian Prime Minister Stephen Harper warned that measures necessary to roll back the recession and boost the Canadian economy would incur "very significant deficits." "I think all of...
Source: RSS feed - channel BNewsBusiness | 17 Jan 2009 | 6:27 am

Disney CEO Iger's 2008 compensation: $51.1M

The Walt Disney Co.'s chief executive, Robert Iger, received a compensation package valued at $51.1 million in fiscal 2008, up 85 percent from a year earlier, according to an Associated...
Source: RSS feed - channel BNewsBusiness | 17 Jan 2009 | 6:23 am

Regulators close 2 banks in Illinois, Wash. state

Regulators on Friday shut down two small banks, National Bank of Commerce in Illinois and Bank of Clark County in Washington state. The Federal Deposit Insurance Corp. was appointed...
Source: RSS feed - channel BNewsBusiness | 17 Jan 2009 | 5:25 am

Kellogg recalls 16 products due to salmonella risk

Kellogg Co. is recalling 16 products containing peanut butter, citing possible salmonella contamination. David Mackay, president and CEO of Kellogg, announced the voluntary recall in a...
Source: RSS feed - channel BNewsBusiness | 17 Jan 2009 | 5:18 am

Disney values CEO Iger's compensation at $51.1M

The Walt Disney Co.'s chief executive, Robert Iger, received a compensation package the company valued at $51.1 million in fiscal 2008, up 85 percent from a year earlier, according to an...
Source: RSS feed - channel BNewsBusiness | 17 Jan 2009 | 4:47 am

Crunch 'cost Arabs $2.5 trillion'

The global economic crisis has cost Arab countries $2,500bn in the last four months alone, according to Kuwait's foreign minister.
Source: BBC News | Business | World Edition | 17 Jan 2009 | 4:42 am

Air China warns it faces loss due to fuel hedging

Air China Ltd., one of China's three major state-owned carriers, warned Saturday it faces a "significant loss" for 2008 because of wrong-way bets on fuel prices that will cost nearly $1...
Source: RSS feed - channel BNewsBusiness | 17 Jan 2009 | 4:17 am

British PM urges banks to come clean over bad assets

Prime Minister Gordon Brown told British banks Saturday they must own up to the extent of their bad assets amid more reports his government could launch a fresh bailout of the struggling...
Source: RSS feed - channel BNewsBusiness | 17 Jan 2009 | 4:16 am

Two U.S. banks fail, first casualties in 2009 (Reuters)

Reuters - Bank regulators closed two small banks on Friday, the first U.S. banks to fail this year but the latest in an upsurge that began last year as the struggling economy and falling home prices took their toll on financial institutions.

Source: Yahoo! News: Business | 17 Jan 2009 | 4:13 am

Two U.S. banks fail, first casualties in 2009

WASHINGTON (Reuters) - Bank regulators closed two small banks on Friday, the first U.S. banks to fail this year but the latest in an upsurge that began last year as the struggling economy and falling home prices took their toll on financial institutions.
Source: Reuters: Business News | 17 Jan 2009 | 4:13 am

Dudley favorite to be new NY Fed chief: report (Reuters)

Reuters - William Dudley, who runs the markets desk at the Federal Reserve Bank of New York, is the likely front-runner to become next president of the bank, the Wall Street Journal reported on Friday.
Source: Yahoo! News: Business | 17 Jan 2009 | 4:08 am

Dudley favorite to be new NY Fed chief: report

NEW YORK (Reuters) - William Dudley, who runs the markets desk at the Federal Reserve Bank of New York, is the likely front-runner to become next president of the bank, the Wall Street Journal reported on Friday.
Source: Reuters: Business News | 17 Jan 2009 | 4:08 am

Funding plans seen top priority in Satyam board meet

HYDERABAD, India (Reuters) - The new board of beleaguered Satyam Computer , which is meeting on Saturday, will have to address immediate funding needs of the cash-strapped firm as its top priority, after talk of a state rescue bid was rejected both by the government and the company.
Source: Reuters: Business News | 17 Jan 2009 | 3:23 am

First bank failures of '09

The financial crisis has claimed its first two banks in 2009 at an approximate cost to the FDIC of more than $200 million.
Source: Business and financial news - CNNMoney.com | 17 Jan 2009 | 3:07 am

Intel: Wake me up when it's July

Intel did what it said it would do: post a miserable fourth quarter. But with the chip industry in a major slump, that kind of candor doesn't extend to the first part of this year.
Source: Business and financial news - CNNMoney.com | 17 Jan 2009 | 2:31 am

Market Snapshot: Stocks brace for new president amid earnings deluge

The inauguration of President-elect Barack Obama might be the only boost for Wall Street next week, as a deluge of what are expected to be mostly bad corporate results and fresh reports on the state of the housing market starts pouring in.

Source: MarketWatch.com - Top Stories | 17 Jan 2009 | 2:28 am

After Hours: Citigroup, Bank of America gain in late trades

Banking stocks remain active as the sector continues to experience major shifts, with the planned split of Citigroup and the injection of more U.S. government funds into Bank of America.

Source: MarketWatch.com - Top Stories | 17 Jan 2009 | 2:22 am

Jobs to stand for re-election at Disney

Steve Jobs, Apple's chief executive, who stepped down this week from the technology group for health reasons, is to stand for re-election to Walt Disney's board
Source: Financial Times - US homepage | 17 Jan 2009 | 2:06 am

Fonterra upset as EU brings back subsidies

Fonterra believes the European Union's decision to revive export subsidies will have a detrimental impact on the dairy industry worldwide. Kelvin Wickham, Fonterra's Managing Director of Global Trade, says the move could push down...
Source: New Zealand Herald - Business | 17 Jan 2009 | 2:00 am

Microsoft CEO and Yahoo Chairman have met: reports

SAN FRANCISCO (Reuters) - Microsoft Corp Chief Executive Steve Ballmer and Yahoo Inc Chairman Roy Bostock met in New York this week, according to media reports.
Source: Reuters: Business News | 17 Jan 2009 | 1:47 am

NYU's Barkow Says States Want Finality in Criminal Judgments

Source: Bloomberg - All Podcasts | 17 Jan 2009 | 1:34 am

Stocks to Watch: Stocks in focus for Tuesday

Among the companies whose shares are expected to see active trade in Tuesday's session are Johnson & Johnson Inc., International Business Machines Corp., and State Street Corp.

Source: MarketWatch.com - Top Stories | 17 Jan 2009 | 1:31 am

Citigroup splits in two, BofA gets government aid (Reuters)

Reuters - Citigroup Inc plans to split into two units and Bank of America Corp took $20 billion in government aid after the two banks suffered huge quarterly losses from the worsening credit crisis.

Source: Yahoo! News: Business | 17 Jan 2009 | 1:18 am

Capitol Report: Obama faces only one more tough year on the economy

President-elect Barack Obama will battle a recessionary economy for nearly a year after he takes the oath of office on Tuesday, economists say. The good news is that it'll probably be only one year.

Source: MarketWatch.com - Top Stories | 17 Jan 2009 | 1:17 am

ConocoPhillips cuts jobs, spending in face of falling oil prices

ConocoPhillips says it will cut 4%, or about 1,300 employees, from its payroll and slash capital spending this year to cope with falling oil prices and lower refining margins as a severe economic downturn saps global energy demand.

Source: MarketWatch.com - Top Stories | 17 Jan 2009 | 1:17 am

Circuit City to liquidate, shutter stores (Reuters)

Reuters - Bankrupt electronics retailer Circuit City Stores said on Friday it will liquidate its assets and shutter hundreds of U.S. stores after failing to reach a deal to sell the company.

Source: Yahoo! News: Business | 17 Jan 2009 | 1:08 am

Circuit City to liquidate, shutter stores

ATLANTA/RICHMOND, Virginia (Reuters) - Bankrupt electronics retailer Circuit City Stores said on Friday it will liquidate its assets and shutter hundreds of U.S. stores after failing to reach a deal to sell the company.
Source: Reuters: Business News | 17 Jan 2009 | 1:08 am

Dialing Up Slower Growth?

When the global credit crisis hit a peak last fall, big phone companies took pains to calm shareholders.

Source: Investor's Business Daily: BUSINESS | 17 Jan 2009 | 12:57 am

Trends & Innovations - Friday

Web's threat to kids overstated?

Source: Investor's Business Daily: BUSINESS | 17 Jan 2009 | 12:57 am

Business Briefs - Friday

McDonald's sees growth in '09. The No. 1 burger chain's CEO, Jim Skinner, said in a TV interview that McDonald's MCD is benefiting from strong...

Source: Investor's Business Daily: BUSINESS | 17 Jan 2009 | 12:57 am

Obama Stimulus Package Could Boost Engineering Company's Profit

The economy is sputtering. The government's response is a stimulus package, laden with investments in roads, bridges and other infrastructure.

Source: Investor's Business Daily: BUSINESS | 17 Jan 2009 | 12:57 am

U.S. to lend $1.5 billion to Chrysler Financial

WASHINGTON (Reuters) - The U.S. Treasury on Friday agreed to lend Chrysler LLC's finance arm $1.5 billion for five years to fund new car loans and boost sales for the sputtering Detroit automaker.
Source: Reuters: Business News | 17 Jan 2009 | 12:56 am

Economic Diary: U.S. Housing Starts, China's Q4 GDP

Source: Bloomberg - All Podcasts | 17 Jan 2009 | 12:52 am

Inflation slows to half-century low in 2008

WASHINGTON (Reuters) - Inflation slowed to a half-century low last year and industrial output fell for the first time since 2002, data showed on Friday, as the recession deepened toward year-end, raising the specter of deflation.
Source: Reuters: Business News | 17 Jan 2009 | 12:49 am

GE unit to shed up to 11,000 workers

US growth will remain weak this year before a turnround in 2010 as unemployment rates continue to rise and prices remain flat, the Bush administration's top economists said as government data showed prices rising at the slowest pace since 1954
Source: Financial Times - US homepage | 17 Jan 2009 | 12:29 am

Microsoft is accused by EU again

The European Commission accuses Microsoft of limiting competition with its Internet Explorer web browser.
Source: BBC News | Business | World Edition | 17 Jan 2009 | 12:21 am

Taxing Times: Maybe now's the time to offer free tax software to all taxpayers

The IRS kicked off the 2009 tax-filing season Friday with the opening of its annual “Free File” Web site, offering free tax software and electronic filing to taxpayers with adjusted gross income of less than $56,000.

Source: MarketWatch.com - Top Stories | 17 Jan 2009 | 12:13 am

Buy-out groups eye AIG aircraft leasing unit

Several private equity firms have registered an interest in International Lease Finance Corporation, the aircraft leasing arm of AIG, and are combing through the company's financial information before making formal bids, according to people close to the matter
Source: Financial Times - US homepage | 17 Jan 2009 | 12:09 am

Five admit defrauding investors of £80m in property swindle

Five buy-to-let cheats have pleaded guilty to defrauding property investors of an estimated £80 million in a Ponzi-style scheme.
Source: Latest Business News from Times Online | 17 Jan 2009 | 12:00 am

Directors quit Mecom after David Montgomery survives coup

David Montgomery, the executive chairman of Mecom, the newspaper group, yesterday survived an attempt to oust him in a boardroom coup, prompting the resignation of six members of the board.
Source: Latest Business News from Times Online | 17 Jan 2009 | 12:00 am

US gloom deepens with news of tumbling factory output

A destructive combination of deflation and plummeting output loomed over the United States yesterday after another double dose of grim economic news.
Source: Latest Business News from Times Online | 17 Jan 2009 | 12:00 am

Barclays loses billions off its share value

Barclays lost a quarter of its stock market value last night, just hours after the ban on the short-selling of banking shares was lifted.
Source: Latest Business News from Times Online | 17 Jan 2009 | 12:00 am

Policyholders at Norwich Union hit by payout cut

Norwich Union, Britain's largest life insurer, added to the economic gloom yesterday by announcing lower final payouts across the board for its 2.3 million with-profits customers.
Source: Latest Business News from Times Online | 17 Jan 2009 | 12:00 am

Wrangle over new chief's pay delays TNK-BP dispute

The appointment of a new Russian chief executive at TNK-BP, the Anglo-Russian oil venture, has been delayed because of wrangling over pay, The Times has learnt.
Source: Latest Business News from Times Online | 17 Jan 2009 | 12:00 am

John Varley may yet have to walk the plank over Barclays losses

John Varley, the Barclays chief executive, looks increasingly like the ship's captain, standing stubbornly on the bridge as everyone else jumps into government lifeboats. Judging by the collapse in its share price, which has almost halved this week, investors believe that his vessel is holed below the water line.
Source: Latest Business News from Times Online | 17 Jan 2009 | 12:00 am

BAE Systems chief opens up with jobs warning to Government

BAE Systems has warned the Government of the consequences of axing major programmes such as Trident or the Eurofighter Typhoon.
Source: Latest Business News from Times Online | 17 Jan 2009 | 12:00 am

Washington plots next step after aid to Citigroup and Bank of America

Washington was last night considering fresh plans to clean up the US banking system’s deteriorating situation.
Source: Latest Business News from Times Online | 17 Jan 2009 | 12:00 am

Thomas of Grail Advisors Says Investor Interest Growing in ETFs

Source: Bloomberg - All Podcasts | 16 Jan 2009 | 11:59 pm

Stocks stage comeback

Stocks rallied Friday, ending a choppy session on a high note as investors eyed the federal bailout of Bank of America, Citigroup's plan to split its businesses and geared up for next week's presidential inauguration.
Source: Business and financial news - CNNMoney.com | 16 Jan 2009 | 11:49 pm

Conoco slashes budget, cutting 4 percent of jobs

HOUSTON (Reuters) - ConocoPhillips , citing a steep decline in oil and gas prices, said on Friday it will slash its capital spending 38 percent this year and cut about 1,300 jobs at the third-largest U.S. oil company.
Source: Reuters: Business News | 16 Jan 2009 | 11:39 pm

Scorecard for the major stock market indexes (AP)

AP - Stocks closed moderately higher Friday after an erratic session that had investors tussling with concerns about the ongoing problems in the banking industry in response to more billion-dollar losses at Citigroup Inc. and Bank of America Corp. Yet investors were also heartened by plans for both banks to restore themselves to profitability, and they were also willing to place bets on a range of consumer and industrial stocks.

Source: Yahoo! News: Stock Markets News | 16 Jan 2009 | 11:36 pm

VIX Index of U.S. Stock Option Prices Retreats 9.6% to 46.11

Source: Bloomberg - All Podcasts | 16 Jan 2009 | 11:27 pm

Obama's Inauguration, Stimulus Plan; Housing Reports

Source: Bloomberg - All Podcasts | 16 Jan 2009 | 11:25 pm

On the Ball: NFL Playoffs, Terrell Owens, Australian Open

Source: Bloomberg - All Podcasts | 16 Jan 2009 | 11:22 pm

Wall Street rebounds after banks report big losses (AP)

AP - Wall Street has managed its second straight comeback, but the rebound was more a sign of the market's turmoil than strength.

Source: Yahoo! News: Stock Markets News | 16 Jan 2009 | 11:19 pm

Al-Marri Case to Test Obama's Terrorism Policies, Says Woolner

Source: Bloomberg - All Podcasts | 16 Jan 2009 | 11:18 pm

Credit Suisse's Konstam Sees Inflation Slowing Through 2009

Source: Bloomberg - All Podcasts | 16 Jan 2009 | 11:14 pm

Stephen Schork Says U.S. Has Huge Oil Surplus

Source: Bloomberg - All Podcasts | 16 Jan 2009 | 11:11 pm

Circuit City Liquidation Not Expected to Boost Sales

Circuit City is finally closing its 567 nationwide stores, after indicating as much late last year. Does the Circuit City liquidation offer good deals? Probably not, according to the Consumerist, but it’s worth a look-see.

CNN has the details on the Circuit City liquidation:

The liquidation of Circuit City Stores (CCTYQ) may end up being a tough sell for the company itself and is sure to carry impacts for its competitors, retail consultants said.

The second largest electronics retailer behind Best Buy Co. (BBY) may not be able to draw foot traffic even with going-out-of-business sales because consumers, as demonstrated during the Christmas holiday, aren’t buying despite deep discounts.

Even an “everything must go” approach may not stir an abundance of interest because shoppers are becoming used to such proclamations, analysts said.

“I think Circuit City will be able to liquidate through its stores, but it will be challenging,” said Gregory Segall, managing partner of private-equity firm Versa Capital Management. “Moving merchandise will likely be tough no matter how motivated Circuit City’s liquidators are.”

Despite the lag, Circuit City’s liquidation offers will probably beat Best Buy–who, meanwhile, is quietly celebrating Circuit City’s dissolution. With the diminished competition, they might as well rename themselves “Buy.” Get the deals while you still can.

Source: Business Pundit | 16 Jan 2009 | 11:10 pm

Historian Ferguson Sees End of `Age of Leverage'

Source: Bloomberg - All Podcasts | 16 Jan 2009 | 11:10 pm

FDIC encourages banks to lend more

Federal banking regulators are considering a plan to dramatically expand a lesser-known bailout program that provides government guarantees to hundreds of billions of dollars of corporate debt.
Source: Business and financial news - CNNMoney.com | 16 Jan 2009 | 11:02 pm

Assault nears end as Israel claims success

The Israeli government is to decide whether to call off its three-week offensive against the Hamas-controlled Gaza Strip, with a government spokesman saying 'it looks like we achieved what we wanted to achieve'
Source: Financial Times - US homepage | 16 Jan 2009 | 11:00 pm

Stimulus: House Dems reveal tax plan

House Democrats on Friday introduced the tax portion of their proposed $825 billion economic recovery package.
Source: Business and financial news - CNNMoney.com | 16 Jan 2009 | 10:59 pm

U.S. to lend $1.5 billion to Chrysler Financial (Reuters)

Reuters - The U.S. Treasury on Friday agreed to lend Chrysler LLC's finance arm $1.5 billion for five years to fund new car loans and boost sales for the sputtering Detroit automaker.

Source: Yahoo! News: Business | 16 Jan 2009 | 10:59 pm

Circuit City to shut down

Bankrupt electronics retailer Circuit City Inc. said Friday it has asked for court approval to close its remaining 567 U.S. stores and sell all its merchandise.
Source: Business and financial news - CNNMoney.com | 16 Jan 2009 | 10:50 pm

Unfounded Rumor Of The Day, Morgan Stanley Smith Barney Edition

Though the whole Morgan Stanley getting Smith Barney for $1 or so thing would in turn look like a scam, very supposedly, Vikram Pandit is headed for employment at MS.

Source: Dealbreaker | 16 Jan 2009 | 10:40 pm

Calls grow for new US toxic asset plan

Speculation is growing that the Obama administration will announce fresh plans to clean up US banks within days of taking office next week, after a top regulator called for a new bank to be set up to unblock the system
Source: Financial Times - US homepage | 16 Jan 2009 | 10:27 pm

KPMG to offer staff shorter week

Financial services group KPMG is to offer staff a chance to save their jobs by taking a sabbatical or reducing their hours.
Source: BBC News | Business | World Edition | 16 Jan 2009 | 10:26 pm

Europe launches antitrust attack on Microsoft

European regulators have launched a surprise new attack on Microsoft over the company's inclusion of the Internet Explorer browser in its Windows operating system, opening the way for rivals including Google to make inroads into a core part of its business
Source: Financial Times - US homepage | 16 Jan 2009 | 10:14 pm

Bail-out fears hit banking shares

Shares in major UK banks fall sharply amid fears that more financial institutions will need to be bailed out by the government.
Source: BBC News | Business | World Edition | 16 Jan 2009 | 10:13 pm

Wall Street rises on energy gain, financials cut losses

NEW YORK (Reuters) - Stocks rose on Friday on strength in the energy sector and companies that hold up well in recessions, while reassuring comments from Britain's Barclays late in the day helped financials cut losses that had driven the market lower earlier.
Source: Reuters: Business News | 16 Jan 2009 | 9:57 pm

Wall Street rises on energy gain, financials cut losses (Reuters)

Reuters - Stocks rose on Friday on strength in the energy sector and companies that hold up well in recessions, while reassuring comments from Britain's Barclays late in the day helped financials cut losses that had driven the market lower earlier.

Source: Yahoo! News: Stock Markets News | 16 Jan 2009 | 9:57 pm

Wall Street rises on energy gain, financials cut losses (Reuters)

Reuters - Stocks rose on Friday on strength in the energy sector and companies that hold up well in recessions, while reassuring comments from Britain's Barclays late in the day helped financials cut losses that had driven the market lower earlier.

Source: Yahoo! News: Business | 16 Jan 2009 | 9:57 pm

Inauguration price tag: $150 million

The total cost of the inauguration of the 44th President of the United States will likely top $150 million by the time the galas and streamers and porta-pots are all cleaned up.
Source: Business and financial news - CNNMoney.com | 16 Jan 2009 | 9:43 pm

Writes-Offs: 01.16.09

$$$ Madoff's mother tangled with the feds [Fortune]

$$$ Risk-Free Profit Idea Of The Day [Zero Hedge]

$$$ Citi Crumbles, Sandy Watches From the 46th Floor [Cityfile]

Source: Dealbreaker | 16 Jan 2009 | 9:35 pm

Chrysler offers 0% after $1.5B bailout

The Treasury Department, expanding its bailout of Detroit, announced Friday that it will loan Chrysler Financial $1.5 billion, opening the way for Chrysler to offer buyers interest-free loans to revive slumping sales.
Source: Business and financial news - CNNMoney.com | 16 Jan 2009 | 9:30 pm

Families pay for answers in autopsies

Hospital cutbacks and slimmed-down insurance coverage have reduced the number of autopsies. For many families, finding out why a loved one died now comes at a price. Caitlan Carroll reports.
Source: Marketplace Money | 16 Jan 2009 | 9:30 pm

Letters: Your opinions of the show

Listeners tell us what they think about our comments regarding Illinois Gov. Blagojevich, student loans, personal finance resolutions, and the sorry state of Chris Farrell's office.
Source: Marketplace Money | 16 Jan 2009 | 9:29 pm

Tax advocate: Simpler is better

National Taxpayer Advocate Nina Olson, who recently issued her annual report on the tax system, talks with Tess Vigeland about changes she'd like to see in the Internal Revenue Code.
Source: Marketplace Money | 16 Jan 2009 | 9:29 pm

Day in the Work Life: Music therapist

Therapist Holly Miller explains how she uses music to help children and adults deal with psychological and developmental problems.
Source: Marketplace Money | 16 Jan 2009 | 9:29 pm

Getting Personal

Economics Editor Chris Farrell answers listener questions about where to put emergency savings, how a person could best stimulate the economy, what that Turbo Tax term means, and more.
Source: Marketplace Money | 16 Jan 2009 | 9:29 pm

How to seek a loan modification

If you're having trouble repaying a loan and are looking to modify the terms, what should you do? Mary Ellen Nicol, a certified housing counselor in Atlanta, has some tips on dealing with your lender.
Source: Marketplace Money | 16 Jan 2009 | 9:29 pm

Falling into triple mortgage trouble

Nearly 10 million U.S. homeowners are having trouble making their mortgage payments. Tanya Ott profiles one Birmingham, Ala., family that has that problem, times three.
Source: Marketplace Money | 16 Jan 2009 | 9:29 pm

Straight Story: Frugal or cheap?

During these tough economic times, Economics Editor Chris Farrell is looking for ways to stretch a dollar just like the rest of us. Tess Vigeland wants to know where he draws the line between being cheap and being frugal.
Source: Marketplace Money | 16 Jan 2009 | 9:29 pm

Rethinking what 'long term' means

If your investment portfolio took a big hit in 2008, you'd be forgiven for wondering if the markets aren't just a big Ponzi scheme. Roger Lowenstein explored that sentiment recently in The New York Times. He talks with Tess Vigeland.
Source: Marketplace Money | 16 Jan 2009 | 9:29 pm

What to consider in brokerage merger

Troubled financial giant Citigroup is merging its Smith Barney brokerage arm with rival Morgan Stanley. It'll be the largest brokerage firm in the world. What should you do if one of those firms manages your funds? Dan Grech reports.
Source: Marketplace Money | 16 Jan 2009 | 9:29 pm

Big losses intensify turmoil for banks

The turmoil in global banking intensified as Citigroup and Merrill Lynch – owned by Bank of America – reported huge losses and shares in Britain's Barclays plummeted amid fears it might need more capital
Source: Financial Times - US homepage | 16 Jan 2009 | 9:23 pm

We Will Gladly Pay You On Tuesday For A Bloated Pension Obligation Today

California's controller says he will begin a 30-day delay on tax refunds and other payments starting Feb. 1 because the state is running out of money.

Controller John Chiang said Friday he must delay $3.7 billion in payments next month because lawmakers have failed to address California's growing deficit.

With a $41.6 billion shortfall over the next year-and-a-half, the state is on the brink of issuing IOUs.

Chiang says his office must continue education and debt payments but will defer money for tax refunds, student aid, social services and mental health programs.

A severe drop in revenue has left the state's main bank account depleted. The state had been relying on borrowing from special funds and Wall Street investors; those options are no longer available.

Calif. tax refunds to be delayed starting Feb. 1 [Associated Press]

Source: Dealbreaker | 16 Jan 2009 | 9:06 pm

Hertz says over 4,000 jobs to go

Car rental firm Hertz cuts more than 4,000 jobs amid slowing demand as businesses and consumers cut back on travel.
Source: BBC News | Business | World Edition | 16 Jan 2009 | 8:53 pm

"When You Say 'Bad Case Of Rectal Prolapse,' What Exactly Do You Mean By That?"

You know. I have to say that sometimes we worry that our venerable Wall Street institutions have no sense of humor. Turns out there's nothing to fear, per this handy guide Citi put together for its Smith Barney employees who may be faced with "tough questions" from clients, such as "Your CEO said only six weeks ago that 'I love that business' and that it's not for sale. What happened?" and :

9. Is the Federal government directing you to liquidate businesses to raise additional capital?

As you know, we do not comment on our discussions with the U.S. Government
or regulators.

[If pressed: Negotiations were not driven by regulators. But regulators are being
updated.]

Source: Dealbreaker | 16 Jan 2009 | 8:48 pm

All Shareholders Are Suspects At This Time

From the mailbag: "Apparently the Citibank downstairs (111 wall) was robbed earlier, mad cops around the place."

Source: Dealbreaker | 16 Jan 2009 | 8:41 pm

Bloomberg: Steve Jobs Considering Liver Transplant

Apple Inc. Chief Executive Officer Steve Jobs is considering a liver transplant as a result of complications after treatment for pancreatic cancer in 2004, according to people who are monitoring his illness.

Patients with Jobs's condition can survive for 20 years or more from the time of their original cancer diagnosis, and the surgery often gives good results, said Steven Brower, professor and chairman of surgery at Mercer University School of Medicine in Savannah, Georgia. Brower hasn't treated Jobs and doesn't know details of his condition.

Source: Dealbreaker | 16 Jan 2009 | 8:38 pm

We Couldn't Help But Giggle

The Adviser's core beliefs are that (1) equity markets are neither completely efficient nor completely inefficient and (2) a disciplined quantitative approach can be used effectively in seeking to outperform market benchmarks. In implementing its investment philosophy, the Adviser uses quantitative tools to analyze and understand the vast amount of data available regarding the markets and securities in which the Adviser is investing. In contrast to the stereotypical "black box" concept of quantitative investing (i.e., obscure mathematical models generating unintuitive trades with no transparency), the Adviser's investment process is "quantitative" in the sense that the Adviser employs quantitative tools to implement a fundamental investment process. The Adviser also believes that a large set of small trades, coupled with systematic risk controls, can offer a more attractive risk-adjusted return than a small set of large trades.

AQR FUNDS [sec.gov]

Source: Dealbreaker | 16 Jan 2009 | 8:28 pm

Governments eye new tools for credit crisis

This week it became clear governments will have to take on even more risk from the private sector if they are to restore the flow of credit to the economy
Source: Financial Times - US homepage | 16 Jan 2009 | 8:11 pm

From The Reader Mail Bag

Source: Dealbreaker | 16 Jan 2009 | 7:43 pm

Warner Bros calls action on Bollywood blockbuster

Hollywood has launched the most ambitious attempt yet to crack the world's most prolific film market, with the commercial release of Chandni Chowk to China
Source: Financial Times - US homepage | 16 Jan 2009 | 7:33 pm

Indiana Gold Bugs

Use of gold by the state and local government. Requires the treasurer of state to designate one or more electronic gold currency payment providers to be a payment provider for the state and political subdivisions. Requires the treasurer of state and fiscal officers of political subdivisions to: (1) maintain one or more electronic gold currency accounts with a designated electronic gold currency payment provider; and (2) conduct all monetary transactions of the state or political subdivisions through electronic gold currency accounts. Provides that an electronic gold currency payment provider must use an electronic gold currency unit that constitutes a monetary unit of account and represents a claim of title to and ownership of a specifically defined, fixed weight of gold held by an independent specie vault. Specifies that a specie exchange with which an electronic gold currency payment provider associates must conduct the business of exchanging gold and silver coin, legal tender of the United States, and the electronic gold currency of the electronic gold currency payment provider. Provides that after December 31, 2009, the state and political subdivisions may not compel or require any person to recognize, receive, pay out, deliver, promise to pay, or otherwise use or employ anything but gold and silver coin (in that form or in the form of a designated electronic gold currency) as media of exchange with respect to certain payments. Provides that after December 31, 2009, a person receiving certain payments from the state or a political subdivision has the option of accepting payment in either legal tender of the United States or in electronic gold currency.

Senate Bill #453 [in.gov]

Source: Dealbreaker | 16 Jan 2009 | 7:29 pm

"No, You're More Embarassing" "No, You're More Embarassing" "No, You," No, You," "YOU," "You"

When we last checked in with Dennis Kneale and Charlie Gasparino, C was asking D if he used hookers and D was going circus freak crazy over the inquiry. Now, via mediabistro, here is the clip from earlier today in which Dennis Kneale and Charlie Gasparino's on-air debate regarding whether or not Vikram Pandit's gotta go devolves into a shouting match only dogs can hear/understand.

Source: Dealbreaker | 16 Jan 2009 | 7:29 pm

Recession in Britain likely to be confirmed next week (AFP)

AFP - Recession is likely to become official in Britain next week when data is expected to show that the economy contracted for a second straight quarter in the final three months of 2008.

Source: Yahoo! News: Stock Markets News | 16 Jan 2009 | 7:19 pm

Hear: Mixed Signs Of The Times

Today on Planet Money:

-- The TED spread finally dropped below one this week. John Ewan, director of the British Bankers Association, helps us throw a party -- starting with the LIBOR dance.

-- Ian Bremmer of Eurasia Group and Ken Rogoff of Harvard lead our search for somewhere, anywhere in the world where you won't feel like the economy is crashing around you. How about Liberia?

-- After eight months of looking for a job in computers, Scott Somerfleck of Ft. Myers, Fla., has taken to putting up signs around town. He tells us why.

Download the podcast; or subscribe. Intro music: The Bird and the Bee's "Polite Dance Song." Find us: Twitter/ Facebook/ Flickr.

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Source: NPR Blogs: Planet Money | 16 Jan 2009 | 7:09 pm

Layoff Watch: 11,000 From GE (GE)?

According to Bloomberg, GE (GE) may layoff as many as 11,000 people at its financial unit.

"General Electric Co.’s finance arm may cut 7,500 to 11,000 jobs, or at least 10 percent of its workforce, because of the global financial slump."

Douglas A. McIntyre

Source: 24/7 Wall St. | 16 Jan 2009 | 7:03 pm

Circuit City to liquidate all stores

Circuit City, the US consumer electronics retailer, became the largest retail victim of the financial crisis after saying it would have to liquidate all its assets.
Source: Financial Times - US homepage | 16 Jan 2009 | 6:50 pm

Culinary Standards Bottom Out

It's a tough time to be in the food and drink business. Restaurants are suffering, and shoplifting at grocery stores has become the new entrepreneurship.

However, while various financial indices -- such as the Fed Funds Rate or the price of container shipping -- have gone to zero, we have yet to see eating standards bottom out.

Until now, that is.

Last Tuesday in London, the Royal Society of Chemistry re-created the workhouse gruel that Charles Dickens imagines Oliver Twist eating to survive grinding poverty and served it for free in its courtyard. Critics were mixed: the society itself described the onion/oats/milk concoction as "barely palatable," but "several of the passers-by thought the gruel tasted quite good." And, of course, "A Mr Bumble character was even on hand to 'eject' any diner who, like Oliver, dared to ask for an extra helping."

Nevertheless, the slop was popular -- hordes of people queued up for a taste of what life was like during recessions long ago.

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Source: NPR Blogs: Planet Money | 16 Jan 2009 | 6:41 pm

Astonishing Worker Layoff Count Today (PFE)(WLP)(PFE)(HTZ)(AMD)

Looking at the headlines at WSJ.com, the majority are about large companies that cut workers today. Circuit City is liquidating, which could put 30,000 people out of work. AMD (AMD) is cutting 1,100. Pfize (PFE) is letting 2,400 salesmen go.

Hertz (HTZ) is firing 4,000 people and Wellpoint (WLP) laying off 1,500. All that on one web page.

Dark day.

Douglas A. McIntyre

Source: 24/7 Wall St. | 16 Jan 2009 | 6:02 pm

Nancy Pelosi’s Rickroll Makes Congress Cats Go Viral

Nancy Pelosi has Rickrolled innocent YouTube viewers via a video featuring cats in Congress. Here it is:

Time Magazine explains the concept behind the Rickroll:

“In Honor of the www.YouTube.com/HouseHub Launch, Speaker Pelosi presents…Capitol Cat Cam”! What follows is a series of video clips of two cats mewing around an office in the Capitol. They sniff the flower arrangement. They look out the window at the Washington Monument. They toy with Pelosi’s ceremonial gavel. Then, after about thirty seconds, things start to get weird.

Congratulations — if you watched this far, you’ve just been Rickrolled by the most powerful woman in Congress. The Rickroll, an internet meme that started a few years ago, is basically a prank in which unsuspecting viewers are tricked into listening to Rick Astley’s 1987 hit “Never Gonna Give You Up”. The classic Rickroll is when someone is tricked into clicking on link that takes them to a video of the song. Some examples are here, here, and here. An Obama-themed Barack Roll got more than 5 million hits on YouTube. And some kid even Rickrolled his English class and posted it online.

Which raises the question: What is Nancy Pelosi doing pranking America? In a nutshell, her handlers know a Rickroll video has a far better chance of going viral (and being written about here, for instance) than a generic “Welcome to Congress on YouTube” video like this one. In that respect, it reflects relatively sophisticated understanding of how the modern Internet works for an elected public official. The Rickroll “video was aimed at attracting more attention to the YouTube channel for Congress,” admits Pelosi’s press secretary Drew Hammill. (The new YouTube channels launched Jan. 12 pull together all the various YouTube sites maintained by members of the House and Senate.) And the cats? A play on the White House’s BarneyCam, of course.

Something must be working. Nancy Pelosi already has 2,841 subscribers on her HouseHub channel. Now, all she has to do is cleverly embed cat and Rick Astley shots when the legislative going gets slow.

Source: Business Pundit | 16 Jan 2009 | 6:00 pm

Hedge fund letters inform, entertain

Hedge funds will soon send out year-end letters, most of them detailing how much they lost in the last year. Even though investors might not be looking forward to the missives, some of them can be pretty entertaining. Amy Scott reports.
Source: Marketplace | 16 Jan 2009 | 5:49 pm

Movie industry still stuck in 2D

A few years ago, 3D was supposed to be the next big thing in movies. But last time we went to the theater, most movies were flat on the screen. Stacey Vanek-Smith explains why the movie industry has yet to completely enter the third dimension.
Source: Marketplace | 16 Jan 2009 | 5:49 pm

Trade and production will lift economy

All the talk about restarting the economy has focused on President-elect Obama's stimulus plan. Commentator Clyde Prestowitz says we need to focus on international trade imbalances and production for the stimulus to work.
Source: Marketplace | 16 Jan 2009 | 5:49 pm

Weekly Wrap: Bringing up the banks

A lot of news came from banking institutions this week, and very little of it was good. Kai Ryssdal takes a look at reports from Citigroup and Bank of America with T. Rowe Price's Andy Brooks and Wall Street columnist Heidi Moore.
Source: Marketplace | 16 Jan 2009 | 5:49 pm

OfficeMax makeover targets women

The office-products chain says women make most of the supply-purchasing decisions in the workplace, so it's going to focus its marketing on them. Mitchell Hartman reports.
Source: Marketplace | 16 Jan 2009 | 5:49 pm

Are we hitting the point of deflation?

Consumer prices have dropped and inflation has slowed, which could push consumers to start spending again. But there's a potential downside that has some economists concerned -- deflation. John Dimsdale reports.
Source: Marketplace | 16 Jan 2009 | 5:49 pm

'Bad banks' idea gaining traction

Many troubled banks are weighed down with mortgage and credit-card assets they can't sell or value. One solution that some are pushing for is creating "bad banks" to buy up toxic assets. Steve Henn reports.
Source: Marketplace | 16 Jan 2009 | 5:49 pm

When bailed-out banks turn to zombies

The term "zombie bank" comes from the Japanese, who use it to describe banks kept on life support by the government. So when does a bank become a zombie -- beyond help and unable to get off the operating table? Ashley Milne-Tyte reports.
Source: Marketplace | 16 Jan 2009 | 5:48 pm

World stocks hit by banking fears, Barclays slumps (AP)

AP - World markets were mixed Friday as early euphoria surrounding the bailout of Bank of America Corp. dissipated amid fears that other banks around the world will need fresh capital injections soon.

Source: Yahoo! News: Stock Markets News | 16 Jan 2009 | 5:16 pm

US retailer Circuit City to close

US electronics retailer Circuit City is to close after failing to reach a deal with its creditors, with the loss of 30,000 jobs.
Source: BBC News | Business | World Edition | 16 Jan 2009 | 5:13 pm

What Records Can You Really Throw Away? (The Motley Fool)

The Motley Fool - Stashes of old, paid bills, expired life insurance policies, receipts for broken gadgets, and canceled checks for haircuts you got in college -- sound like your filing system?
Source: Yahoo! News: Business | 16 Jan 2009 | 5:01 pm

The New First Golfer

Golf was not Barack Obama's idea.

His game was, and always will be, basketball. Golf wasn't even on his mind. But his wife, Michelle, was becoming concerned about the increasing frequency of his hard-court injuries—the sore wrists, black eyes and sprained fingers suffered during pickup games in courts around Chicago. "Why don't you take up something less dangerous?" Michelle told her husband in early 1997. "Like golf?"

She didn't need to ask twice. Within days, Obama dragged a scuffed set of used clubs to the Jackson Park Golf Course, the historic Chicago public track. It had been nearly two decades since the newly elected Illinois state senator had played a few rounds in high school back in Hawaii. Obama wasn't quite sure how to dress for the game (one friend recalls an early round when he arrived on the first tee, on a sweltering summer day in southern Illinois, clad in a black silk shirt). And so his pals prepared themselves for what they figured would be a rare treat—a spectacular Barack Obama crackup.

"When he first started, you couldn't call him a golfer," says Illinois state Sen. Terry Link, who played one of those first rounds with Obama. "He left a lot to be desired, at first." Even during those early rounds with scores of 100-plus, Obama, a lefty, flashed a smooth swing and exhibited a consistently unruffled demeanor.

On the golf course, American presidents have always revealed a thing or two about themselves, and Obama is no different. Throughout his public life, particularly during the most intense moments of his historic presidential campaign, Obama demonstrated grace under pressure. When things went well, he never became too impressed with himself; when things went wrong, he never sank too low. Obama balances a confident unflappability with a blunt self-assessment of his shortcomings; the combination has served him well in politics and in sport.

And in golf, as in life, Obama refuses to take any shortcuts. "When he'd shoot an 11 on a hole, I'd say, 'Boss, what did you shoot?' " says Marvin Nicholson, 37, the Obama campaign's national trip director and now a special assistant to the president-elect. "And he'd say, 'I had an 11.' And that's what he'd write on his scorecard. I always respected that."

As one old friend says, "No one is harder on Barack than Barack." In his book, The Audacity of Hope, Obama describes his 2000 bid to unseat a Democratic incumbent for a congressional seat as "an ill-considered race, and I lost badly—the sort of drubbing that awakens you to the fact that life is not obliged to work out as you'd planned."

On the golf course during those ugly early rounds, his shots almost never worked out as he had planned. But friends say Obama never lost faith that he would, some day, improve.

"His inability to play the game at first and his frustration at not being able to compete with me did not lead him to quit or throw his clubs in the water," Link says. "I admire that, and I will admire that in his presidency—he doesn't get frustrated out there as all of us golfers do. We take our frustrations out on that little white ball, but he doesn't. And that's his attitude about everything in life: If I want to do something, I have to learn how to do it and not give up on it."

Obama approaches the game in the same way that he conducts his politics—maniacally methodical, aggressively competitive and devoutly risk-averse.

"Every time he came out, you could tell he had gone and practiced and tried to work on his game," says James Clayborne Jr., an Illinois state senator and frequent playing partner. "He didn't like losing. He was a beginner, and sometimes he had to take the whupping. But he never liked it. He's a good athlete. Before too long, he was beating a lot of the guys who had beaten him."

 John Bouman, another early playing partner, attributes Obama's "smooth, coordinated swing" to helping him shave strokes off triple-digit scores. "He has a heck of a lot more balance than I do," says Bouman, the president of the Sargent Shriver National Center on Poverty Law in Chicago.

"The great thing about him," Nicholson says, "if he duffs one dead into the woods, there's no cursing. The most excited we get on the golf course is a fist bump."

Now that he was a golfer, Obama refused to put away his basketball, much to the chagrin of Michelle, who does not play golf. "Like any smart, red-blooded American man, Barack decided to take up golf and still play basketball," says Dan Shomon, an Obama aide in the state Senate who had encouraged his boss to play golf. "Barack thought, This is great—now I get to play golf, and I can continue to play basketball. He figured he had pulled the ultimate scam on Michelle."

Later that year, Obama played four rounds in Chicago with Ian Manners, a Brit who was married at the time to Obama's half-sister, Auma. The rounds, Manners said, allowed him and Obama to get to know each other and, as Manners put it, "get away from the women."

Already, Obama's handicap was 24, quite a feat for a man who had been playing less than a year. "He played percentage golf, always keeping the ball under control, whereas I was always going for the big one," Manners recalls.

Whenever he needed it, Obama seemed to have a special constituency pulling for him: The golf gods.

"If I went into the trees, my ball would stay there," Manners says. "If he went into the trees, it seems like the ball would always bounce out, 50 yards farther up the fairway. I joked with him that if he was as lucky at politics as he was at golf, he'd be president some day."


Golf became the most beloved presidential pastime sometime early in the last century. Obama will be the 15th American president of the past 18 to have played the game, a century-long run of golf-obsessed chief executives that began ignobly with the 340-pound William Howard Taft. President Taft pursued his passion, comically, despite the warning of his mentor, Theodore Roosevelt, that playing golf could be "fatal" for a political man. The stigma was long hard-wired to the gilded game; John F. Kennedy had often forbidden photographers from going anywhere near his golf outings in Palm Beach and Hyannis Port.

Bill Clinton had a pollster figure out how Americans would react if he played golf on vacation (the game didn't poll as well as hiking in the mountains; Clinton played golf anyway). But today, the game's political peril has all but vanished despite George W. Bush's very public abstinence from golf during the Iraq war (most of the time). Golf is now seen as a boost to practically any long shot, even a national political career for an African-American man with a funny name from the South Side of Chicago.

"An awful lot can happen on the golf course," Barack Obama told a friend a decade ago. He decided to play golf later in life in pursuit of something other than just escapist pleasure, just as Lyndon Johnson and Richard Nixon had. For L.B.J., the golf course was a convenient venue to lobby senators into voting for legislation that he was championing, like the Voting Rights Act of 1965. (L.B.J. said, "One lesson you'd better learn if you want to be in politics is that you never get out on a golf course and beat the president.") Vice President Richard Nixon was 40 when he took lessons because he knew the game was the surest path to winning over his boss, Dwight D. Eisenhower.

For Obama, golf was appealing because he believed the game would help him connect with his colleagues in the state Senate as well as his constituents in far-flung places like downstate Illinois. Much to his surprise, he soon fell hard for the game's charms. Friends say he became as devoted to golf as he is to his beloved basketball. "Basketball and golf are his one-two," Marvin Nicholson says. "Now, he wants to play all the best courses: St. Andrews, Pebble Beach, Bethpage Black.

"He usually shoots in the mid-90s, sometimes the low 90s," Nicholson says. "He'd be better if he could play more.... He's pretty long off the tee ... very good around the greens, a real good short game. The clubs that give him the most trouble are his long irons ... or he'd shoot around 90 pretty consistently."

But a dozen years ago, as a young state legislator in Springfield, Ill., Obama was a public-course hacker who just wanted to fit in. The two best ways were golf and poker. "Yes," Terry Link laughs, "we did both those evil things." In the winter of 1997, Obama was a regular at the legislators' weekly Wednesday-night poker game, nicknamed The Sub-Committee Meeting. It was held, amid the cigar smoke and empty beer bottles, in Link's basement, and no one can recall Obama ever losing his cool and going on tilt. "He played poker the same way he played golf—he never got rattled," Link says. "And boy, we tried to rattle him. Watch his demeanor. Whenever anyone tries to rattle him, he'll always break into a smile. He'll always laugh."

 That spring, Obama played about a dozen rounds. In Springfield, he and his fellow legislators would often play on weekday afternoons, after 4, at the Rail Golf Course, a forgiving layout that until 2006 was the site of an LPGA tournament. "We were the minority party at the time," Link says. "The majority party would be busy doing things, and they were not seeking our advice or looking for us. So after session, we'd sneak out and play golf."

They called it "bonus golf." On many lovely spring afternoons, Obama pressed members of his staff, including Dan Shomon, to leave work early for a quick nine holes before dark. "We're going right now," Obama would tell Shomon.

"Chief, I've gotta work," Shomon said he'd reply. "I'm on the government payroll." "We'll just sneak out," Obama would say. "Come on."

Shomon recalls, "When the weather was nice, there was no stopping him. He was burning to play."

During those first months in the state Legislature, Obama never traveled south of the Mason-Dixon line. Shomon persuaded his boss that he needed to tour the southernmost reaches of Illinois that June. "You have to meet people," Shomon told his boss, "and play a round of golf every day." They crossed from east of St. Louis to just west of the Indiana border.

"Problem No. 1, it was 100 degrees," Shomon says. "There had been a drought. Our first round was a course in the metro area east of St. Louis—a bad course, no rain; it was like we were playing on the New Jersey Turnpike."

The highlight of the trip was a fund-raising golf outing for state Senator Jim Rea. Another round featured Jim Hart, the former St. Louis Cardinals quarterback. "The amazing thing is, he was beating me most of the time," Shomon admits, grimly. "And at golf, you should know he's a bad winner and a bad loser. When he won, I'd see him the next day, and he'd tell me, 'I played some good golf yesterday, and you didn't play any good golf yesterday.' If he lost, he'd get quiet and sulky. He doesn't like to admit it, but it's true."

In 1998, Obama finally decided to invest in a new set of clubs. At a golf discount store in the Chicago suburbs, he found a set on sale for $350. He wrote a check, but the cashier informed him that the store's check-processing company had rejected it. There was more than enough money in Obama's account, but the company had flagged Obama's South Side zip code, 60619, before the matter was resolved, recalls Shomon. "It didn't matter that his credit was perfect."

After Obama ran for Congress in 2000, his bruising defeat to Bobby Rush left his campaign deep in debt. The golf course suddenly became a forum to put that bad race behind him and help him mount a run for the United States Senate.

"I met him on the first hole,'' Steven S. Rogers, a former business owner who teaches at the Kellogg School of Management at Northwestern University, told The New York Times about a round in 2001. "By the sixth hole, he said, 'Steve, I want to run for the Senate.' And by the ninth hole, he said he needed help to clear up some debts." Rogers wrote Obama a check.


Not long after Obama announced his run for president, on the steps of the Old State House in Springfield, he landed in Las Vegas late one weekday afternoon for a campaign stop the next morning. There were only two hours of light left. Obama and three aides raced over to the Bali Hai Golf Club, just off the strip and not far from Mandalay Bay, for a quick nine holes.

Obama and Marvin Nicholson, a 10-handicapper, teamed up against Robert Gibbs, a single-digit handicapper who was the campaign's communications director, and Reggie Love, the candidate's close personal aide and a former Duke University basketball and football player who was a wild boomer with his big-headed driver. On the first tee, Love announced the stakes: $10 per hole. "Whoa," Obama said. "Reggie, you must be good."

They were required to take carts, though Obama insists on walking when it's an option. Gibbs played the round of his life, one-putting nearly every green. By the end of the nine holes, they had been in Vegas less than three hours, and Obama and Nicholson had each lost $30.

Obama almost always gambles a couple of bucks on golf, Nicholson says—usually nassaus or skins. "It makes the putts matter," Nicholson says.

During the next 18 months, several times off the campaign's official schedule and without the media's knowledge, Obama would drag Gibbs, Nicholson, Love or all three with him for at least nine holes. (Nicholson estimates Obama played a dozen rounds during the campaign.)

On Father's Day 2007, the group played the Olympia Fields Country Club North Course, site of the 2003 U.S. Open. On Martha's Vineyard in August 2007, early each morning as Michelle and the girls had breakfast, Obama raced a few times around Farm Neck Golf Club, a favorite of Bill Clinton's.

 One of the highlights for Obama was a round at Medinah Country Club, home of the 2006 PGA Championship. This occurred in June 2008, shortly after he had clinched the Democratic presidential nomination. The foursome had intended to play the No. 1 course, but the pro was so excited that Obama was there, he put the group on No. 3, the championship course and site of the 2012 Ryder Cup.

"It was funny," says Nicholson. "We went out there, and I can honestly say it was the worst round of golf in my life. By the fourth hole, I was getting kind of down. And on the tee box on the fifth hole, he came up to me, put his arm around me and said, 'Hey, man, you just have to remember, we're not on the campaign trail, we're not at a town-hall meeting. We're on a golf course, and we're playing golf!' ''

"Good point," Nicholson recalls telling Obama, laughing at the memory. Though they were able to play only 16 holes, Nicholson says Obama was on his way to finishing "north of 100."

During his vacation last August, Obama played twice in Hawaii, at Luana Hills Country Club, a "Jurassic Park-like" course in the shadow of Oahu's majestic eastern mountains, and a public course, the Olomana Golf Links. He played with his high school buddies, Bobby Titcomb, Marty Nesbitt and Dr. Eric Whitaker, as well as Nicholson, Love and Gibbs.

The first day at Olomana, there was no wagering, and it was just as well. The pace of play was excruciatingly slow, and by 5:30 p.m., Obama and his pals looked at their watches on the tee at 17 and noticed they had dinner reservations with their wives in 30 minutes. They hustled off the course to shower and change. The next day, the $2 bet at Luana Hills was won easily by Obama and his three Hawaii buddies against the campaign group.

Obama managed to get in several other quick rounds, often with David Katz, the campaign's photographer and a scratch golfer who was a member of the University of Michigan golf team. In Ohio, for about 90 minutes on one blessed afternoon last June, Obama and his aides watched transfixed, on a campaign-bus television, the last four playoff holes between Tiger Woods and Rocco Mediate at the U.S. Open. "We were cheering them both on," Nicholson recalls. "It was such a nice break."

Before becoming president, Obama insisted they play unplugged golf: no cell phones or BlackBerrys on the course. For the front nine, it would just be Obama and the guys and golf (and usually no chatter about anything but the game). At the turn, the phones would be turned back on. Obama and the guys would grab a hot dog and a beer. Maybe a call or two would be placed, or an e-mail returned. Then on 10, the phones would be shut off again. It's hard to believe President Obama will be permitted to go wireless when playing, but he would if he could.

"Golf really is now one of his true loves," Nicholson says. "He loves to play, and he admits that he's not a great golfer. But when he becomes an ex-president, he told me the other day, he'd like to try to become a single-digit handicapper." Hope he can believe in.Related Links
David Plouffe
Vote, Baby, Vote
Late Breaks: A Mouth-Watering Slice of Obama



Source: Portfolio.com: Top 5 | 16 Jan 2009 | 5:00 pm

Will Big Oil Go Shopping? (XOM, CVX, RDS, BP, COP, APA, DVN, APC)

Source: 24/7 Wall St. | 16 Jan 2009 | 4:48 pm

Circuit City's Hari Kari

Source: 24/7 Wall St. | 16 Jan 2009 | 4:37 pm

Paulson Predicts Banks Are Done For, Shares Drop (AIG)(FNM)(FRE)(C)(JPM)(BAC)(WFC)

It has begun to dawn on investors. The news about Bank of America (BAC) and Citigroup's (C) fourth quarter earnings is the beginning of the end of the private enterprise banking system in America. It may return in a few years, but not until the government decides it can sell the stakes it is accumulating as part of the financial bailout.

Henry Paulson today said that most of the second half of the TARP, the next $350 billion, is going to have to be sent to banks. If only half of that sum goes into the system to keep financial firms from failing, it will overwhelm their current market capitalizations. The government will own a large portion of the equity in the nation's largest banks, whether that was it intention or not. What Barney Frank wants to do with TARP cash may become irrelevant.

Shareholders in banks are starting to catch on to their dilution problem. The stocks in BAC, JPMorgan (JPM), and Wells Fargo (WFC) are all down between 7% and 10%. The common stock of these companies is headed to the same place the shares of Fannie Mae (FNM), Freddie Mac (FRE), and AIG (AIG) ended up.

Douglas A. McIntyre

BAC, WFC, FNM, FRE, AIG, C, WFC, JPM

Source: 24/7 Wall St. | 16 Jan 2009 | 4:23 pm

Australia: The not so lucky country

John Agostini has just done his bit for Australia. Armed with his own savings and A$21,000 ($26,000) in Government grants, he has bought a new three-bedroom home to be built this year in McGregor, an emerging suburb on Canberra's...
Source: New Zealand Herald - Business | 16 Jan 2009 | 4:00 pm

Ports of Auckland enters rival's patch

Ports of Auckland is to go head-to-head with rival Port of Tauranga, on its own patch. Ports of Auckland said yesterday that it would be the major customer of logistics company NZL Group's planned container terminal at Sulphur...
Source: New Zealand Herald - Business | 16 Jan 2009 | 4:00 pm

Beef, lamb rise forecast despite crunch

The price paid for beef and lamb will rise significantly this year despite the global financial crisis, according to Meat & Wool New Zealand. Its mid-season update forecasts a 38 per cent rise in lamb farm-gate prices for the year...
Source: New Zealand Herald - Business | 16 Jan 2009 | 4:00 pm

Brian Gaynor: Sweet overseas honeypot turning sour

The domestic banks have played a major role in the boom and bust of recent years and their attitude towards funding and lending will have a significant impact on economic activity in 2009 and beyond. In light of this it is important...
Source: New Zealand Herald - Business | 16 Jan 2009 | 4:00 pm

Weldon dives in deep

As the global financial crisis lurched from dire to near-apocalyptic in the last quarter of last year, sharemarket boss Mark Weldon helped to wrest at least a modicum of media, public and political attention away from the general...
Source: New Zealand Herald - Business | 16 Jan 2009 | 4:00 pm

Downturn yet to hit video games

All throughout 2008, as the economy went from bad to worse, video games continued to sell at record levels, boosted by the popularity of the Nintendo Wii and blockbuster games such as Grand Theft Auto IV. Still, there are some...
Source: New Zealand Herald - Business | 16 Jan 2009 | 4:00 pm

Even brewing industry starting to lose froth as recession bites

MILWAUKEE: Even the brewing industry is starting to go flat in the worldwide economic slump. SABMiller, the London-based brewer of Grolsch, Miller Genuine Draft and Peroni Nastro Azzurro lagers, said its beer shipments fell unexpectedly...
Source: New Zealand Herald - Business | 16 Jan 2009 | 4:00 pm

Trustee waiting for Orange proposals

The trustee for Doug Somers-Edgar's Orange Finance, which ceased making repayments to investors late last year, says he is waiting to see details of management proposal to address breaches of the company's trust deed. Late last...
Source: New Zealand Herald - Business | 16 Jan 2009 | 4:00 pm

Hawkes Bay remains a high rider

Despite the economic slowdown, good tenant and investor interest in the Hawkes Bay continues to underpin the commercial and industrial property. Ian Little, senior analyst for Bayleys Research, says the market has remained active...
Source: New Zealand Herald - Business | 16 Jan 2009 | 4:00 pm

Indicator: Dads At School

Adam Blank writes:

Planet money indicator - Sweaters. My child goes to private school in Manhattan. When he first started kindergarten only the mothers were dropping the kids off, or dads in suits. As the semester progressed I have noticed a sharp rise in the casual sweater wearing male. I am guessing that a lot of private schools are going to have a hard time holding on to a portion of their students.

Adam's letter reminds me of an article in this Sunday's New York Times, Daddy's Home, and a Bit Lost. This part of it really jumped out at me.

At his local Y.M.C.A., the out-of-work Masters of the Universe and the professionals who relied on those huge salaries -- architects, landscape designers and high-end contractors -- can be found pumping iron together at 10 a.m.

"A lot of them have a deer-in-the-headlights kind of look to them," he said. "If you have a massive mortgage and your wife has been out of the work force for a decade or more, being laid off can seem crushing."

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Source: NPR Blogs: Planet Money | 16 Jan 2009 | 3:58 pm

Breakfast With Keynes

Adam Davidson talked to Morning Edition this morning about John Maynard Keynes. It's fairly fabulous.

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Source: NPR Blogs: Planet Money | 16 Jan 2009 | 3:55 pm

Cosmetics Companies Down The Recession Drain (EL, RDEN, AVP, BARE, REV)

Source: 24/7 Wall St. | 16 Jan 2009 | 3:30 pm

This Week’s Links

Becker-Posner on stimulus packages.

Arnold Kling posted a telling chart of economic promises vs. realities.

The Britannica Blog has an interesting series on mistakes that Obama shouldn’t make (with videos; based on historical precedents.)

PEHub links to another bailout game.

Karlson & McKenzie link to the doggie treadmill. God forbid we ditch treadmills altogether and actually walk the dog.

Source: Business Pundit | 16 Jan 2009 | 3:06 pm

Sad Saks

Over the next several days, Saks will notify workers affected by the cutback. Most positions will be eliminated by Jan. 30.

Asked how the cost reductions will affect company morale, Sadove said, “I think people have responded exceptionally well. Their spirits are as good as can be in a difficult economy.”

He didn’t dismiss the possibility of additional cuts this year, though he stressed, “It’s highly unlikely you would see any of this magnitude.” Costs are something that are always being examined, he added.

No store closings were announced, though some are possible in the future, Sadove acknowledged. “We are not looking at massive store closings. It would be a few, not a substantial number.” Any closings are dependent on working out arrangements with developers, he noted. There are 53 Saks Fifth Avenue stores, and 51 Off 5th outlets. Saks also operates saks.com.

The inventory reductions, at about 20 percent, won’t be at that level across the board by brand. With clothing performing the worst lately, other categories will be hit less hard by Saks’ receipt reductions.

In his prepared statement, Sadove said, “Our financial performance is increasingly being challenged by some of the most difficult economic conditions our company has faced in its 84-year history. It is our expectation that the economic environment will remain extremely challenging through 2009, if not beyond. The sustained downturn in the economy and the decline in luxury consumer demand necessitates that we take appropriate and decisive measures to position the company for this new operating environment. The cost and capital expenditure reductions are structured to minimize the impact on our customers, and the reduction in inventory receipts is reflective of the decrease in consumer demand. Each of our actions will benefit 2009 and should better position the company for the future, when economic conditions improve. We continue, however, to focus on and make targeted investments in our strategic merchandising, marketing and selling initiatives.”

Eligible associates will be offered appropriate severance packages, resulting in charges of about $9 million, principally in the fourth quarter. Saks also has identified additional nonemployee-based cost reductions, primarily in the areas of procurement, information technology, distribution and logistics, and travel.

Capital expenditures for fiscal 2009 have been reduced to about $60 million, a decrease of over 50 percent from the projected 2008 level. However, a critical project to complete the renovation of the flagship’s third-floor designer showcase is continuing. About half the project was already completed.

Other renovations are also continuing in the flagship, but not all.

Sadove concluded, “We have an exceptional brand, valuable and unencumbered real estate, a loyal customer base, solid vendor relationships and an outstanding team. Although we are staying the course with our long-term strategies, we are making prudent adjustments to our organization and our operations that are needed in this environment. We are positioning the company to be an even stronger organization when the economy improves.” Related Links
Holiday Hangover
Bargain Hunting at Saks Fifth Avenue
Banking on Thanks



Source: Portfolio.com: Top 5 | 16 Jan 2009 | 3:00 pm

It's So Not Over

Way back in the fall, economist Ragu Rajan warned us that the federal government could spend a ton of money on the bailout and yet still not spend enough to fix the problem. In today's headlines, news that two big recipients of government capital are still on the ropes. From the Wall Street Journal:

Stocks opened higher on Friday as the U.S. government injected $20 billion into Bank of America and guaranteed losses on over $400 billion in assets of both Bank of America and Citigroup.

In October, Uncle Sam invested $45 billion in Citigroup and $25 billion in Bank of America. Meanwhile, the European Central Bank just slashed the benchmark interest rate to its lowest level ever (sound familiar?) and Floyd Norris says the cheaper rate, Stateside, just might be showing signs of working.

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Source: NPR Blogs: Planet Money | 16 Jan 2009 | 2:52 pm

This Week’s Weird and Unusual Jobs

Pickings for this post certainly are slimmer these days--meaning it would be smart to know how to set yourself apart–but the weird:legitimate job ratio is exactly the same as it was during better days.

What does that mean about the economy? Nothing. What does it mean about the general population? That there is a certain proportion of people in the world always looking for something offbeat or unusual. Here’s this week’s batch:

5. United Arab Emirates: manufacturer of Masharabia?

Do you have an email for a manufacturer of Masharabia?
I’m looking for someone who can export to the USA
* Compensation: $1

Of all random questions to ask the general public, this has got to be it. Is that $1 a finder’s fee?

4. Los Angeles: Tele-Sell Lions, Tigers, & Bears to Local Zoos!!!!!!!

Sell packaging tape to manufacturing companies.
SUPER EASY RECESSION PROOF SALES!!!
Even lions, tigers and bears will buy in this economic zoo!!!!!!!!

* $11.00 p/h + commission.

Darn. I thought they really were selling lions, tigers and bears to actual zoos. Packaging tape is almost as glamorous. I guess.

3. Orange County: Did you earn $65,523.87 in December?

No. Schmuck.

2. Make-Up horror movie

New Jersey: K.N.O.W. Productions wants a make-up person who can do blood and gore call now.

Note to ax murderers: stay away this time. We had trouble cleaning up after you guys last time you came.

1. Arizona: PROTECTION FOR IDENTITY THEFT!!!

Two Industry leading companies seeking people that are sharp, professional, and great communicators to help people protect them selves from the fastest growing crime in America, IDENTITY THEFT! Flexible hours. Very legitimate work. Pays very well! for all the info. Take a close look at the presentation on this site.
Tip. you really want to pay attention
* Compensation: 15K-250K

You know what makes me think this posting is shady? For one, they don’t know the qualitative difference between protecting oneself from identity theft and protection for identity theft. Secondly, they call the work very legitimate. Thirdly, the pay–for “all the info”–is 15-250K. Fourth, they tell you to really pay attention. I’m running the other way.

Happy Friday!

Source: Business Pundit | 16 Jan 2009 | 2:19 pm

Deutsche Bank Comments on GM, Saying Operationally Things Look Good But Stock Still A Zero

Analysts at Deutsche Bank commented on General Motors (NYSE: GM) after the company presented additional details of its restructuring plan at the Detroit Auto Show Conference on Thursday. They said the operational restructuring could work, but the financial restructuring has big risks. They said the stock is likely a "zero."

Rear more...

Source: 24/7 Wall St. | 16 Jan 2009 | 2:18 pm

Schwab's Numbers Down, But Now The Envy of Wall Street (SCHW)

Source: 24/7 Wall St. | 16 Jan 2009 | 2:17 pm

FTSE 100 up at 94.62 at 4,215.73 (AP)

AP - Share prices on the London Stock Exchange were higher at midday Friday.
Source: Yahoo! News: Stock Markets News | 16 Jan 2009 | 1:52 pm

Company Creates Cologne that Smells Like a Soccer Team Locker Room

From Ananova:

The smell of a (soccer) changing room has been made into a new aftershave. Scent of Success is created from a blend of grass, sweat, boot leather and heat spray, reports the Daily Telegraph. It is made by Sports Interactive, who also make cult computer game Football Manager. They say it has been created from samples collected from a number of successful teams’ dressing rooms.

It is the latest in a long line of bizarre scents that have been bottled and sold as fragrance. Burger King (recently) launched a meat-flavoured body spray called Flame. And (early last) year the Channel 4 soap Hollyoaks launched its own aftershave and perfume range.

People stink enough as it is. Note to companies: Please don’t make it any worse.

Source: Business Pundit | 16 Jan 2009 | 1:49 pm

Consumer Deflation, The Risks Are Real

Source: 24/7 Wall St. | 16 Jan 2009 | 1:38 pm

With Big Loss, BofA Gets Big Bailout

Federal officials have given Bank of America Corp. $20 billion more in bailout money and have guaranteed the bank against some $100 billion in mortgage loan losses. Meanwhile, the bank reported a net loss of $1.79 billion in the fourth quarter. That compares to net income of $268 million a year earlier.

The latest assistance from the U.S. Treasury Department and the Federal Deposit Insurance Corp. comes amid growing concerns about the bank’s financial condition. In particular there have been reports that BofA has found losses in Merrill Lynch & Co., which it acquired Jan. 1, that are worse than expected.

Federal officials announced the deal early this morning. After the bailout news, Bank of America reported its harsh earnings report.

The net loss applicable to common shareholders was $2.39 billion, or 48 cents per diluted share, down from net income of $215 million, or 5 cents per share, in the same period in 2007. The results include Countrywide Financial, which BofA purchased on July 1, but not Merrill Lynch & Co. Inc., which was acquired on Jan. 1.

The bank says fourth-quarter results were driven by escalating credit costs, including additions to reserves, and significant writedowns and trading losses in the capital markets businesses.

These actions reflect the deepening economic recession and extremely challenging financial environment, both of which significantly intensified in the last three months of 2008, the bank said in a release,

Global Consumer and Small Business Banking and Global Wealth and Investment Management were profitable, paced by Bank of America’s successful and expanding deposit business. Negative results in Capital Markets and Advisory Services masked the profitability in business Lending and Treasury Services within Global Corporate and Investment Banking.

Merrill Lynch preliminary results indicate a fourth-quarter net loss of $15.31 billion, or $9.62 per diluted share, driven by severe capital markets dislocations.

The additional $20 billion from the government makes BofA the largest recipient of federal cash during the $700 billion Troubled Asset Relief Program adopted last year by Congress. Bank of America got $15 billion from that program in October. When it bought Merrill, it got the $10 billion that was slated to go to the investment bank. With the latest injection, the bank will have gotten $45 billion. Citigroup (NYSE:C) had been the largest recipient.

The government will get preferred stock with an 8 percent dividend for its latest investment. In addition to the $20 billion, the government will guarantee BofA against losses on a pool of $118 billion in residential and commerical real estate loans.

Charlotte-based BofA will be responsible for the first $10 billion of losses. After that the government will assume 90 percent of the additional losses.

The bank’s stock fell 18 percent Thursday as rumor of the financial problems and likely federal action spread.

BofA’s stock, which has traded between $10.01 and $45.08 over the last year, closed at $8.32 per share Thursday, down from Wednesday’s closing price of $10.20.

Related Links
No Bull: Bank of America Keeps Merrill Name
JP Morgan: A Better Acquirer than Bank of America
Parsing Bank of America: Crisis Is Our Friend



Source: Portfolio.com: Top 5 | 16 Jan 2009 | 1:30 pm

Mortgage rescue plan is extended

A scheme aimed at stopping thousands of vulnerable people losing their homes is to be extended across England.
Source: BBC News | Business | World Edition | 16 Jan 2009 | 1:09 pm

Mortgage Rates Fall to Record Lows (BusinessWeek Online)

BusinessWeek Online - Mortgage giant Freddie Mac said on Jan. 15 that rates on 30-year fixed-rate mortgages fell below 5% this week -- the lowest level since it began surveying lenders in 1971.
Source: Yahoo! News: Business | 16 Jan 2009 | 1:08 pm

Bank of America bail-out agreed

Bank of America, the US's largest bank, will receive $20bn in government aid and $118bn of guarantees against bad assets.
Source: BBC News | Business | World Edition | 16 Jan 2009 | 1:02 pm

Citigroup to split as losses grow

Struggling US banking giant Citigroup is to split the firm in two, as it reports a quarterly loss of $8.29bn (£5.6bn).
Source: BBC News | Business | World Edition | 16 Jan 2009 | 12:57 pm

Got change for 100 trillion dollars? Zimbabwe prints new banknotes

A Z$100tr, currently worth about US$30 is to be introduced in Zimbabwe, state media says.
Source: BBC News | Business | World Edition | 16 Jan 2009 | 12:15 pm