World Business News Headlines for March 3, 2009

Top Analyst Upgrades (DWA, EBAY, ENR, LSI, MEDX, PZZA)

These are some of the few analyst upgrades and positive calls we have seen from Wall Street this Tuesday morning with over two hours to the open:

DreamWorks Animation SKG (DWA) Raised to Buy at Piper Jaffray.
eBay (EBAY) Raised to Hold from Sell at Collins Stewart (late yesterday call).
Energizer (ENR) Raised to Neutral from Sell at UBS.
LSI (LSI) Raised to Outperform at FBR.
Medarex (MEDX) Raised to Neutral from Sell at Citigroup.
Papa John’s (PZZA) Started as Buy at SunTrust Robinson Humphrey.

Jon C. Ogg
March 3, 2009

Source: 247 Wall Street | 3 Mar 2009 | 12:24 pm

Opel must clear up questions on survival plan-Germany

HANOVER, Germany, March 3 (Reuters) - GM's German carmaker Opel has not supplied the government with enough information for Berlin to decide whether to rescue the troubled company, Economy Minister Karl-Theodor...
Source: RSS feed - channel BNewsBusiness | 3 Mar 2009 | 12:16 pm

Citigroup to lower some mortgage payments (AP)

AP - Struggling bank Citigroup Inc. said Tuesday that it will lower mortgage payments for some homeowners to an average of $500 a month for three months as part of a new program to help the unemployed.
Source: Yahoo! News: Business | 3 Mar 2009 | 12:16 pm

London Markets: London shares retreat from early gains, extend slide

London shares trade mildly lower, after falling sharply in the previous session, with several major banks and insurance firms under pressure again.

Source: MarketWatch.com - Top Stories | 3 Mar 2009 | 12:12 pm

More stock weakness in the works

It may be a struggle to throw the gloom off Wall Street, with futures mostly lower Tuesday, after the Dow Jones industrial average fell below 7,000 for the first time since 1997.
Source: Business and financial news - CNNMoney.com | 3 Mar 2009 | 12:09 pm

Wall Street heads for mixed open after big drop (AP)

AP - Wall Street is headed for a mixed open Tuesday as investors recover from a massive selloff and await data on home and auto sales.

Source: Yahoo! News: Stock Markets News | 3 Mar 2009 | 11:56 am

Zimbabwe accountant chooses film over stock market (Reuters)

Reuters - When businessman Lyndon Plant answered an advertisement in his old school newspaper, little did he know that it would be the start of a new career as a film producer.
Source: Yahoo! News: Stock Markets News | 3 Mar 2009 | 11:55 am

Oil rises, but no long-term rally in sight

Read full story for latest details.
Source: Business and financial news - CNNMoney.com | 3 Mar 2009 | 11:55 am

Wall Street heads for mixed open after big drop

Wall Street is headed for a mixed open Tuesday as investors recover from a massive selloff and await data on home and auto sales. The Dow Jones industrial average on Monday plunged far...
Source: RSS feed - channel BNewsBusiness | 3 Mar 2009 | 11:54 am

Blackstone CEO takes 99 percent pay cut (Reuters)

Reuters - Blackstone Group LP Co-founder and Chief Executive Stephen Schwarzman's pay fell 99 percent in 2008, a year that saw the private-equity firm post a $1.33 billion loss.
Source: Yahoo! News: Business | 3 Mar 2009 | 11:54 am

Blackstone CEO takes 99 percent pay cut

(Reuters) - Blackstone Group LP Co-founder and Chief Executive Stephen Schwarzman's pay fell 99 percent in 2008, a year that saw the private-equity firm post a $1.33 billion loss.

Source: Reuters: Business News | 3 Mar 2009 | 11:54 am

RBS could have cut Sir Fred's pay-off, MPs told

Sir Fred Goodwin could have been paid off for much less than the £630,000 annual pension that he was awarded, the chief executive of the body managing the Government's stakes in Britain's bailed-out banks told MPs today.
Source: Latest Business News from Times Online | 3 Mar 2009 | 11:53 am

Savers open 1m new building society accounts

Over 1m new building society accounts were opened in 2008 according to the mutuals' trade body.
Source: Telegraph Finance | 3 Mar 2009 | 11:49 am

Looking for work? Debt collectors are in demand in the UK

An opportunity may have arisen for the estate agents and luxury car salemen put out of work by the recession.
Source: Telegraph Finance | 3 Mar 2009 | 11:48 am

Gazprom's 3Q net profit up 16 pct

Russian gas monopoly Gazprom said Tuesday its net profit rose 16 percent to 132 billion rubles ($3.6 billion) in the third quarter of 2008 from a year earlier, boosted by high market...
Source: RSS feed - channel BNewsBusiness | 3 Mar 2009 | 11:48 am

Microsoft says research budget may create new jobs

HANOVER (Reuters) - Microsoft may create up to 3,000 jobs as it raises investment in research and development by $1 billion this year, its chief operating officer said on Tuesday.

Source: Reuters: Business News | 3 Mar 2009 | 11:47 am

Europe Markets: Europe shares fall again as banks, oil producers skid

European shares on Tuesday bounce back a bit after the pounding that took markets to nearly six-year lows, as banks take back a portion of the previous session’s heavy losses and drug makers also manage to advance.

Source: MarketWatch.com - Top Stories | 3 Mar 2009 | 11:47 am

Standard Chartered profits up 17 percent in 2008

Standard Chartered PLC reported Tuesday that profits rose 17 percent in 2008, driven by growth in wholesale banking despite the global economic turmoil. For the year ending Dec. 31,...
Source: RSS feed - channel BNewsBusiness | 3 Mar 2009 | 11:44 am

Mortgage delinquencies up for 8th straight quarter (AP)

AP - The number of people who were late making their mortgage payments shot up 53 percent in the fourth quarter of 2008 from the same period in 2007, according to data provided by TransUnion LLC.

Source: Yahoo! News: Business | 3 Mar 2009 | 11:42 am

Spanish jobless total rises again

The number of unemployed people in Spain rose by 154,058 to almost 3.5 million in February, official figures show.
Source: BBC News | Business | World Edition | 3 Mar 2009 | 11:38 am

Will The Current Quarter Be The Worst?

angrybear2 The IMF said that this year will be bad, but it is being accused of being too optimistic.

According to Reuters, “The global economic downturn will be considerably deeper than even the International Monetary Fund forecast a month ago, the Organization for Economic Co-operation and Development’s chief economist Klaus Schmidt-Hebbel said.

The OECD believes that IMF projections that global GDP will grow .5% this year worldwide are well off the mark. The organization also said it thinks this quarter will be the worst of the downturn.

That, of course, is a guess, and a bad one at that. Unemployment in developed nations is almost certainly to grow because of losses at businesses. If exports from China continue to slow, that huge economy could begin to post negative GDP. If credit remains locked down in the US and Europe, the second and third quarters could get much worse than the first.

Nice guess. No dice.

Douglas A. McIntyre

Source: 247 Wall Street | 3 Mar 2009 | 11:38 am

Toyota arm seeks government loan

Toyota, the world's biggest car maker, asks the Japanese government for a 200bn-yen loan for its car financing unit.
Source: BBC News | Business | World Edition | 3 Mar 2009 | 11:38 am

Toyota in talks for Japan government loan

Toyota's financing unit is in talks with a Japanese government-backed bank on possible lending, the automaker said Tuesday, underlining the serious woes facing the car industry amid...
Source: RSS feed - channel BNewsBusiness | 3 Mar 2009 | 11:38 am

Croatia, Hungary sign pipeline connection deal

ZAGREB, March 3 (Reuters) - Croatia and Hungary signed an agreement on Tuesday to connect their natural gas pipelines by mid-2011, to ensure a steady supply for the region and avoid a repeat of a gas crisis...
Source: RSS feed - channel BNewsBusiness | 3 Mar 2009 | 11:37 am

Reality check on Obama's deficit plan

President Obama won't submit a formal 2010 budget request to Congress until next month. But the head-knocking on the Hill over fiscal priorities begins in earnest this week.
Source: Business and financial news - CNNMoney.com | 3 Mar 2009 | 11:37 am

EU claims has solution to euro state default

The European Union's top economy official said Tuesday that the 16 countries using the euro have a solution ready to rescue any member in danger of defaulting on public debt payments _ but...
Source: RSS feed - channel BNewsBusiness | 3 Mar 2009 | 11:36 am

Comic Relief: Boost your donation on Red Nose day without paying more

Millions of pounds will be donated to Comic Relief but the charity's coffers could swell by so much more if you use Gift Aid.
Source: Telegraph Finance | 3 Mar 2009 | 11:34 am

Gunmen wound Sri Lankan cricketers

Gunmen on Tuesday launched an audacious attack on a bus carrying the Sri Lankan cricket team in Lahore, Pakistan's second largest city, killing seven policemen and injuring six team members
Source: Financial Times - US homepage | 3 Mar 2009 | 11:33 am

World stocks extend losses after multi-year lows

European and Asian stock markets fell for a second day running Tuesday, though losses were less severe than a day earlier when Wall Street tumbled to 12-year lows and London revisited a...
Source: RSS feed - channel BNewsBusiness | 3 Mar 2009 | 11:33 am

Corpcom Breaks New Ground for Luxury Brands

MILAN, March 3 /PRNewswire/ -- - New Global Platform for Co-Branded Payment Cards - With Photo Corpcom GmbH today announces the...
Source: RSS feed - channel BNewsBusiness | 3 Mar 2009 | 11:33 am

Global recession will be 'worse than forecast'

The global recession is set to be deeper than already pessimistic forecasts, according to the Organisation for Economic Cooperation and Development (OECD), which warned that protectionist measures will only intensify the financial crisis.
Source: Latest Business News from Times Online | 3 Mar 2009 | 11:32 am

World stocks extend losses after multi-year lows (AFP)

AFP - European and Asian stock markets fell for a second day running Tuesday, though losses were less severe than a day earlier when Wall Street tumbled to 12-year lows and London revisited a 2003 trough.

Source: Yahoo! News: Stock Markets News | 3 Mar 2009 | 11:32 am

Citigroup to lower some mortgage payments

Struggling bank Citigroup says it will lower mortgage payments for some homeowners to an average of $500 a month for three months as part of a new program to help the unemployed. ...
Source: RSS feed - channel BNewsBusiness | 3 Mar 2009 | 11:32 am

World markets slide again amid financial fears (AP)

AP - World stock markets fell further Tuesday as investors continued to fret about the global financial sector after American International Group Inc. reported the biggest quarterly loss in corporate history, and HSBC Holdings PLC slashed its dividend and revealed it needed to raise nearly $18 billion from shareholders.

Source: Yahoo! News: Stock Markets News | 3 Mar 2009 | 11:29 am

Even Toyota (TM) Needs A Loan

old-car1 It was never supposed to come to this. The global recession has hurt car companies with weak balance sheets such as GM (GM) and Nissan and forced them to turn to their governments for financial assistance. But not Toyota (TM). It was too well run and had too strong a balance sheet. Until now.

According to Reuters, “Toyota Motor Corp has applied for a loan backed by the Japanese government to help its finance arm cut funding costs as the global crisis tightens access to credit.” Because of its relative financial help the largest car company in the world will have access to the capital at low interest rates.

In a perverse way, the news may be good. A strong financial arms means that Toyota may be more willing and able to extend loans to consumers as their appetite for buying cars returns. That is becoming more likely to happen as the age of the average car increases and tax rates are lowered under programs in the new budget.

If one car company is likely to recover before any other, it is Toyota because of its huge distribution network, reputation for quality, and fuel efficient vehicles.

Having some extra cash in the bank will help

Douglas A. McIntyre

Tagged: GM, TM

Source: 247 Wall Street | 3 Mar 2009 | 11:24 am

AIG Band-Aid offers no cure

The government has a new remedy for sickly financial giants -- but signs of healing remain scarce.
Source: Business and financial news - CNNMoney.com | 3 Mar 2009 | 11:24 am

Brown to hold Obama economy talks

UK Prime Minister Gordon Brown arrives in the US for his first meeting with new President Barack Obama.
Source: BBC News | Business | World Edition | 3 Mar 2009 | 11:21 am

Stock bargains: Takeover targets

While some companies go into survival mode when times get tough, the strong ones look for opportunities to snap up cheap assets. We're already seeing this take place with Abbott Laboratories' acquisition of Advanced Medical Optics in January. I think it's a safe bet that this trend will continue.
Source: Business and financial news - CNNMoney.com | 3 Mar 2009 | 11:18 am

Biz is failing: Should you tell the staff?

Gary White has a problem many business owners share these days: His company has taken a financial hit, and he's not sure how honest he should be with his staffers about the situation.
Source: Business and financial news - CNNMoney.com | 3 Mar 2009 | 11:18 am

Retirement losses: What now?

Question: I've just received the statement for my workplace retirement savings account -- 99% of which is invested in an S&P 500 index fund -- and it shows a loss of 37.5% for 2008. I'm 60, make about $100,000 and I was hoping to retire next year. What immediate next step should I be taking to recover my account value? --Benjamin, Albuquerque, New Mexico
Source: Business and financial news - CNNMoney.com | 3 Mar 2009 | 11:17 am

Your old mobile could be worth £200

Customers who want to upgrade their mobile phone can now find out the instant value of trading in their old one at one retail chain.
Source: Telegraph Finance | 3 Mar 2009 | 11:15 am

Apple (AAPL): Can The Mac Make It Overseas?

apple-logo1 As PC sales begin to contract in the US, Apple (AAPL) is hoping to pick up sales overseas. If the new Gartner research on global PC sales is right, the Mac may have as much trouble in the international market as it has at home.

The Mac still benefits from Apple’s cult status which has also helped drive adoption of the iPod and iPhone outside America. But, the Mac is more expensive than most PCs and that can’t be overcome during a period when consumer confidence is down in every major country.

According to Reuters, “As U.S. demand for personal computers craters, Apple Inc is getting a boost from overseas PC sales, where iPods are hugely popular but Macs have not been a major presence.”

Some data suggests that Apple’s sales internationally were up modestly late last year. But, a month or two in the current economic crisis can be a lifetime especially when it comes to product demand. Companies and individuals are keeping computers longer and often only replacing machines when they break down. The processors of PCs that are already two years old are usually good enough to handle most tasks.

The Mac’s enemy is not just the economy. In addition, PCs have become a commodity and the replacement cycle for them is getting longer. The older machines just work too damn well.

Douglas A. McIntyre

Tagged: AAPL

Source: 247 Wall Street | 3 Mar 2009 | 11:12 am

Problems mount at sub-prime firm

Sub-prime lender Cattles admits to a failure of accounting controls at the firm and suspends three senior managers.
Source: BBC News | Business | World Edition | 3 Mar 2009 | 11:09 am

Indications: U.S. stock futures bounce off decade's worst levels

U.S. stock futures bounced off their worst close in more than a decade on Tuesday, as the previous session’s rout stirred debate about whether a bottom has been found or whether there’s more selling to come.

Source: MarketWatch.com - Top Stories | 3 Mar 2009 | 11:09 am

Northern Rock makes £1.4bn loss

Nationalised bank Northern Rock confirms it made a loss of £1.4bn in 2008 following hefty write-offs on mortgage loans.
Source: BBC News | Business | World Edition | 3 Mar 2009 | 11:06 am

UK construction activity shrinks to lowest level in 12 years

The construction sector shrank to the lowest level in 12 years in February as activity orders and employment all fell.
Source: Telegraph Finance | 3 Mar 2009 | 11:04 am

European markets descend further

European markets fall away in mid-morning trading, wiping out early gains and dashing hopes of a sustained bounce.
Source: BBC News | Business | World Edition | 3 Mar 2009 | 11:02 am

Six Signs The Recession Is Ending

cammonopoly_wideweb__430x32502 A number of economists predict that the recession could last into 2010 and unemployment will top 10%. If the crisis does not deepen into an even longer downturn, there will have to be early signs that the credit crisis is ending and that consumer and business confidence are coming back.

And, there are a few things to watch for. They are the most likely signs that the economy has bottomed and is about to move up.

The first thing to watch for is the S&P 500 to trade flat for three months. While it continues to move down, investors are expecting two or three more quarters of bad earnings. If it spikes up too early, a rally probably cannot be sustained. A flat market at least indicates that investors are becoming more at ease with the economy.

The next signal that the situation is not worsening is car sales. Most of the large manufacturers are experiencing monthly drops of over 45% compared with last year. It may take a year or more for those numbers to settle at drops of closer to 10% to 20%. But, if US vehicle sales stay steady at 25% to 30% down, the consumer is beginning to tiptoe back into the market. The likely causes for this is that extraordinary deals on new cars are becoming attractive to buyers who have cut their debt and can afford to make a modest investment based on very attractive interest rates helped by capital put into the banks by the government. Low fuel prices will help that and federal government tax cuts will give consumers a few extra dollars a month.

From a global perspective, the trading in bonds for developing countries that might default on their debt, nations such as Ireland and Ukraine, need to stop changing hands at distressed levels. If the bets on these nations being able to shoulder that own national financial obligations improve, it is a sign that global credit is becoming available, at least at the sovereign level, and that the IMF has been able to get commitments from the “richer” nations to provide credit to those that are in trouble.

China’s GDP has to stop falling and hold at a level of 6% growth. If it drops well below that, it means that demand for inexpensive manufactured goods in the US, UK, and EU has dried up completely. If China economic expansion holds, even at levels that are low compared to the last decade, there is a sign that economic activity in the West still has a pulse.

The stimulus package has to begin to pay off. As its earliest investments go into helping states and municipalities keep their employees, cuts in place like California have to level off. As money goes into building the energy grid and broadband makes it into the system, job creation in those sectors has to measurably increase.

Finally, when the government investment in banks and insurance companies drops below a rate of $100 billion a month and begins to slow to much more modest levels as the number of firms that need big bailouts decreases, it means that the period of huge catastrophes has ended and that normal credit availability from the Fed has returned as the major method for feeding the credit markets.

Douglas A. McIntyre

Source: 247 Wall Street | 3 Mar 2009 | 10:58 am

Economic Report: Switzerland enters recession with fourth-quarter GDP drop

LONDON (MarketWatch) -- Swiss gross domestic product contracted by 0.3% in the final three months of 2008, with a rapid drop in exports and continued weakness in the financial sector nudging the economy into its first recession since 2003, according to government data released Tuesday.

Source: MarketWatch.com - Top Stories | 3 Mar 2009 | 10:57 am

Europe's shares plunge to 12-year low

Europe's shares tumbled to a 12-year low on Tuesday as the continuing dismal outlook for the global economy saw shell-shocked investors pour cold water on a limp early session rally. The FTSE Eurofirst...
Source: RSS feed - channel BNPaperBusiness | 3 Mar 2009 | 10:51 am

Downturn to be considerably deeper than IMF forecast: OECD (Reuters)

Reuters - The global economic downturn will be considerably deeper than even the International Monetary Fund forecast a month ago, the Organization for Economic Co-operation and Development's chief economist Klaus Schmidt-Hebbel told Reuters.
Source: Yahoo! News: Business | 3 Mar 2009 | 10:50 am

Downturn to be considerably deeper than IMF forecast: OECD

PARIS (Reuters) - The global economic downturn will be considerably deeper than even the International Monetary Fund forecast a month ago, the Organization for Economic Co-operation and Development's chief economist Klaus Schmidt-Hebbel told Reuters.

Source: Reuters: Business News | 3 Mar 2009 | 10:50 am

Brixton ousts chief executive

The chief executive of the industrial property landlord has been forced out following a clash over a potential fundraising.
Source: Telegraph Finance | 3 Mar 2009 | 10:46 am

The Financial Crisis: The World At War

earth If it was not clear two weeks ago or even last week, the destruction of the economic and business sectors of the world is no longer inchoate. The speed of the destruction has left the realm of what people fear and has entered the domain of what they know. As Kali ventures into the economic world, so many lives will be ruined that the number will be uncountable.
The most-discussed concern of the media was whether people would be late on their mortgage payments has quickly evolved into speculation about how many people will have homes at all.

No one could have imagined that Japan, the second largest economy in the world, would contract at a rate of nearly 13% on an annualized basis or that Korea’s economic output could drop 20%. In the US, the GDP is shrinking at a rate of 6% now, but there is nothing in the economic or employment news that keeps us from believing that America will avoid a double-digit drop in GDP If the US skids at that rate, the other large economies in the world, all of which depend on the American consumer to some great degree, will have the hulls of their exports breached below the water line.

One of the reasons that the drop in economic activity has accelerated is that there is no mechanism in place to cope with a failure of this magnitude. The world in which The Great Depression played itself out predated the globalization of credit and economic interdependence. Even the worst of the large post-war recessions rarely lasted more than a year. Even at their most inventive, government policy systems are incapable of operating in an environment where the pace of negative change quickens by the week.

The largest issue between now and whenever the cataclysm ends is whether the major economic powers develop more intimate relationships or are driven to isolation in order to defend their economies through protectionism. This development would reach an epic level if nations such as China began to hold capital in their country and slow their purchase of US debt. That would begin a lethal exchange between the greatest exporting and importing nations of the world, with America blocking the inflow of Chinese goods and China flailing back by throttling its appetite for Treasuries. Without the ability to borrow money at reasonable rates any hope of continuing to stimulate the US economy would flag and China’s manufacturing machine would lose its largest market.

The most valuable treasure that will be lost is the fundamental economic transition from one generation to the next. In developed nations, the old will no longer have the means to retire, the middle aged will face joblessness and an obliteration of the standard of living to which they believed they were entitled since they were very young, and the young may have to fight for a small number of jobs most of which pay little more than a fraction of what their parents made in 2004, 2005, and 2006.

In the underdeveloped world the misery’s fallout will be incomprehensible. Whatever social services and generosity that has come from the more wealthy nations will dry up along with the financial capacity that has created a history for large scale compassion. A hoarding of natural resources, especially those that are agriculturally based, would cause the cost of humanitarian aid to become unaffordable, especially when there is so little capital for eleemosynary efforts because of ruined economies. In places like East Africa, where millions of people look into the face of starvation every year, the misery could be apocalyptic.
It is almost treasonous to paint such a dark picture of the failure of the American financial system which has carried the nation through sixty years of prosperity. That system is now fractured mid-axle. It may take a lifetime or more for historians to sort out its causes, and the federal government feels the need to sift through that sand in the name of justice.

When blame can be defined it will be too late to bring back the world we knew.

Douglas A. McIntyre

Source: 247 Wall Street | 3 Mar 2009 | 10:34 am

Standard Chartered profit rises 19%

Standard Chartered, now Britain’s second-biggest bank by stock market value, predicted today that it would ride out the economic downturn better than many of its competitors.
Source: Latest Business News from Times Online | 3 Mar 2009 | 10:33 am

Earnings Watch: Updates, advisories and surprises

A roundup of the latest corporate earnings reports and what companies are saying about future quarters.

Source: MarketWatch.com - Top Stories | 3 Mar 2009 | 10:31 am

When Citigroup (C) Becomes A Penny Stock

data Two years ago, Citigroup shares traded for $55. Last week, after the government said it might own as much as 36% of the company, the stock dropped to $1.40. Citigroup is about to become a penny stock like AIG (AIG), which hit this milestone in the middle of last month.

The plan to save Citigroup has two flaws. The first is that it assumes that the bank will not suffer tens of billions of dollars in losses as the year goes by. That has not been said explicitly, but if it is not true, then the federal government will be expected to put much more capital into Citi and will end up owning much more than 36%.

The weak link in the program to sustain the viability of the big bank is the government’s requirement that it raise private funds as a condition for the government to do its part. As the BBC noted “The deal does not require extra taxpayer investment, but is dependent on Citi raising extra private capital.”

Private investors, whether those are sovereign funds, private equity firms, or institutional investors, are not going to put a dime into Citi equity or debt. The reason is simple. If the company faces more significant write downs, the federal government will have to provide the money to keep the bank afloat. That puts all of the other capital invested in Citi at risk.
Without private capital infusions into Citi, what are the government’s options? The answer is that it does not have any. If the big bank needs more capital, the Treasury will have to provide it. Without other alternatives, tax payers will own a larger and larger piece of the firm with each new investment.

When the government announced its intentions, Citi’s shares fell by 39% in part because of the dilution that was part of the program to buttress the bank’s financial condition. The next round of capital the bank needs, and it will need it because the economy and credit markets are still getting worse, will take the stake that taxpayers own even higher. Citi will become a $.50 stock bought and sold by day traders. Not terribly long ago, it was the largest bank in the world. Soon it will be listed on the pink sheets.

Douglas A. McIntyre

Tagged: AIG, C

Source: 247 Wall Street | 3 Mar 2009 | 10:29 am

Citigroup eyeing third-party joint ventures: report

(Reuters) - Citigroup Inc is hoping to create joint ventures with third parties as a way of shedding businesses it does not want, the New York Post reported on Tuesday, citing high-level insiders at the New York bank.

Source: Reuters: Business News | 3 Mar 2009 | 10:29 am

Irwin Kellner: Has housing found a floor?

PORT WASHINGTON, N.Y. (MarketWatch) -- Home prices are closer to stabilizing today than at any time in the past nine years.

Source: MarketWatch.com - Top Stories | 3 Mar 2009 | 10:27 am

How Far Off Is The Revenue Projection In The Budget?

uncle-sam A fine way to hold onto your job and move up in the world is to hold true the maxim of “under promise, over deliver.” When President Obama runs for reelection, we may find that he has committed one of the most egregious violations of this approach to expectations control. On Thursday, the Obama administrated released its proposed 2010 Federal Budget. The plan for reducing the deficit by more than half by 2013, or to $533 billion was described in this proposal.Much of this budget shifts funds from one part of the government to another in an effort to make progress on some of the promises that President Obama made in his campaign. These changes include the elimination of most of the spending on the Iraq War by the end of 2010 and expanding government spending on healthcare. Overall, government spending will increase to more than $3 trillion through 2013.

Additionally, the proposal incorporates President Obama’s proposal to the tax code. This includes raising taxes on the rich (individuals making over $200,000 and families making more than $250,000), lowering taxes for the lower and middle classes, and eliminating loopholes and exemptions. Overall, the reformed tax policy should equate to less tax revenue at any given level of GDP. What assumption is driving the Obama administration’s claim that it will be reducing the budge deficit?

President Obama can exercise considerable control over government expenditures, however his argument for reducing the budget deficit hinges on a variable that is largely out of his control. Inherent in all projections in the budge proposal is an assumption that the economy will grow at an annualized rate of a little over 5% between 2010 and 2013. Receipts from income taxes and corporate taxes, the two largest sources of government revenue, are projected to grow by roughly 42 percent and 86 percent over the same time period. Projecting economic growth is always tricky business. However, given the current state of the global economy and the fact that GDP growth has been close to 3% over the past 50 years of U.S. history, the 5% figure seems a bit unrealistic.

A deviation from this projected growth trajectory will cause President Obama to miss his 2013 deficit target. Should income tax revenue grow at 30% and corporate tax revenue 60%, holding spending constant, the 2013 deficit will come in at a little over $800 billion. While this estimate may be possible four years from now, the point is that that the Obama administration has picked the upper limit for a GDP growth estimate in making its projections.

There are two possible economic and political implications if President Obama misses his budget target for 2013. In the current economic climate international investors are more than willing to finance the U.S. government’s deficits because it is the safest place for their money. If this trend continues the Obama administration can stick to its spending plans at the expense of expanding the national debt. If, however, the world becomes more concerned about the United States’ growing debt burden, financing for $3.3 trillion worth of spending projected for this year may be more difficult to find. In the political realm, it is possible that a significant mistake in economic calculations might cost President Obama his job. However, given the American public’s concern for fiscal responsibility he may get a mulligan.

Garrett McIntyre

Source: 247 Wall Street | 3 Mar 2009 | 10:24 am

FTSE extends six-year lows

London equities failed to hold small, intraday gains as the six-year lows seen on the FTSE 100 overnight intensified as the trading day developed. Initial support for the battered financial sector was...
Source: RSS feed - channel BNPaperBusiness | 3 Mar 2009 | 10:23 am

Bayer posts profit increase but cuts 2009 view on plastics demand

Bayer AG, Germany’s largest drugmaker, on Tuesday reported a 58% increase in fourth-quarter profit, but cut its financial forecast for 2009 as demand for the plastics it produces collapses amid the global recession.

Source: MarketWatch.com - Top Stories | 3 Mar 2009 | 10:18 am

Most Asian markets extend slump amid finance gloom

HONG KONG -- Most Asian stock markets extended their slump Tuesday after unremitting troubles at financial giants like American International Group and HSBC sent Wall Street tumbling to new multiyear lows...
Source: RSS feed - channel BNPaperBusiness | 3 Mar 2009 | 10:16 am

Stock index futures point to higher Wall Street open (Reuters)

Reuters - Stock futures for the Dow Jones industrial average, the Nasdaq 100 and the S&P 500 share indexes were up 0.3-0.6 percent, pointing to a higher start on Wall Street.

Source: Yahoo! News: Business | 3 Mar 2009 | 10:11 am

Stock index futures point to higher Wall Street open

(Reuters) - Stock futures for the Dow Jones industrial average, the Nasdaq 100 and the S&P 500 share indexes were up 0.3-0.6 percent, pointing to a higher start on Wall Street.

Source: Reuters: Business News | 3 Mar 2009 | 10:11 am

Stock index futures point to higher Wall Street open (Reuters)

Reuters - Stock futures for the Dow Jones industrial average, the Nasdaq 100 and the S&P 500 share indexes were up 0.3-0.6 percent, pointing to a higher start on Wall Street.

Source: Yahoo! News: Stock Markets News | 3 Mar 2009 | 10:11 am

Standard Chartered defies gloom

Standard Chartered bank reports a 19% rise in its profit for 2008 to $4.8bn (£3.4bn) as its focus on Asia pays dividends.
Source: BBC News | Business | World Edition | 3 Mar 2009 | 10:04 am

Standard Chartered profit up 17%, sees good start to 2009

Standard Chartered reported a 17% rise in its annual net profit Tuesday and said it had seen a good start to 2009, thanks to the performance of its wholesale banking arm.

Source: MarketWatch.com - Top Stories | 3 Mar 2009 | 9:58 am

Asian shares extend global sell-off

HSBC shares dropped to their lowest in nearly 10 years, dragging down the Hang Seng index as Hong Kong investors had their first chance to react to the bank's discounted share sale plan and dividend cut...
Source: RSS feed - channel BNPaperBusiness | 3 Mar 2009 | 9:52 am

People's car

Volkswagen's car line-up underpins future ambitions
Source: BBC News | Business | World Edition | 3 Mar 2009 | 9:52 am

StanChart profits from rivals' woes

Shares in Standard Chartered leapt in early London trading on Tuesday as the bank announced record results for 2008 and said it was benefiting from the problems at many of its rivals. The shares rose 50p...
Source: RSS feed - channel BNPaperBusiness | 3 Mar 2009 | 9:42 am

Gold: Warning for investors chasing shortterm gains

The scale of the recent moves in the gold price and the resulting publicity are reasons for caution.
Source: Telegraph Finance | 3 Mar 2009 | 9:36 am

Cattles shares slump after warning sparks shareholder stampede

Shares in U.K. subprime lender tumble by as much as 80% Tuesday after the group says it has suspended three executives and issues its second profit warning in as many weeks.

Source: MarketWatch.com - Top Stories | 3 Mar 2009 | 9:34 am

Asian stocks extend fall, but climb off lows

Asian shares broadly decline Tuesday, with the poor health of the global financial system pressuring regional banks and price declines in crude oil and gold weighing down resource stocks.

Source: MarketWatch.com - Top Stories | 3 Mar 2009 | 9:29 am

Northern Rock repossessions soar by 63pc

The number of homes repossessed by nationalised lender Northern Rock soared by 63pc last year the company has revealed.
Source: Telegraph Finance | 3 Mar 2009 | 9:20 am

Chrysler hopeful meets criteria for U.S. loans

GENEVA (Reuters) - Chrysler vice-chairman Jim Press said on Tuesday the auto maker was "hopeful" the automaker had all the criteria necessary to receive additional U.S. government loans.

Source: Reuters: Business News | 3 Mar 2009 | 9:15 am

Chrysler hopeful meets criteria for U.S. loans (Reuters)

Reuters - Chrysler vice-chairman Jim Press said on Tuesday the auto maker was "hopeful" the automaker had all the criteria necessary to receive additional U.S. government loans.
Source: Yahoo! News: Business | 3 Mar 2009 | 9:15 am

Redrow rises on founder's boardroom coup

Redrow is facing a boardroom coup after the housebuilder's founder and former chairman increased his shareholding in the business and demanded an executive position on its board.
Source: Latest Business News from Times Online | 3 Mar 2009 | 9:13 am

Media Digest 3/3/2009 Reuters, WSJ, NYTimes, FT, Bloomberg

newspaper1 According to Reuters, too much dependence on government aid could cause a second recession when the companies are forced to stand on their own.

Reuters reports that Obama is considering funds to buy bad assets.

Reuters reports that February auto sales will be near a 27-year low.

Reuters reports that sales of the Apple (AAPL) Mac are growing overseas but face hurdles.

Reuters writes that an anti-tax haven bill is coming to the Senate.

Reuters reports that a unit of Toyota (TM) is seeking a $2.1 billion state-backed loan.

Reuters reports that the new US aid to AIG (AIG) may not be the last.

Reuters reports that HSBC (HBC) will shut most of its US businesses.

Reuters reports that the Bank of America (BAC) CEO had his comp cut 60% last year.

The Wall Street Journal reports that Saab is stepping up talks with buyers.

The Wall Street Journal reports that CItigroup (C) is lowering mortgage payments for some people who have lost jobs.

The Wall Street Journal reports that Microsoft (MSFT) is starting a new internet search engine.

The Wall Street Journal reports that Freddie Mac’s (FRE) new CEO is leaving.

The Wall Street Journal reports that the frugality of shoppers is hurting business.

The Wall Street Journal reports that Intel (INTC) and TSMC are started a venture to build small chips.

The Wall Street Journal reports that GM (GM) will buy Delphi’s steering business.

The Wall Street Journal reports that EMC (EMC) has been accused of taking kickbacks.

The Wall Street Journal reports that Munich Re had weak earnings.

The Wall Street Journal reports that PNC (PNC) cut its dividend.

The Wall Street Journal reports that money under management at sovereign wealth funds rose last year.

The Wall Street Journal reports that a Chinese lawmaker is likely to bid for Volvo.

THe Wall Street Journal reports that Toyota (TM) is cutting global production by 12%.

The New York Times reports that the US is likely to keep reigns on Fannie Mae (FNM) and Freddie Mac (FRE).

The New York Times reports that Genentech (DNA) says a bid from Roche is too low.

The New York Times reports that a Deutsche Bank analyst says GE (GE) has billions of dollars of unrealized losses in its financial unit.

The FT reports that the head of Bank of America (BAC) thinks it was a mistake to take so much government aid for the purchase of Merrill.

The FT reports that this is the worst year for dividend cuts since 1938.

Bloomberg reports that Toyota (TM) may have it first loss in six decades.

Bloomberg reports that Chinese officials think its economy could recover in the first half.

Douglas A. McIntyre

Tagged: AAPL, AIG, BAC, C, DNA, EMC, FRE, GE, GM, HBC, INTC, MSFT, PNC, TM

Source: 247 Wall Street | 3 Mar 2009 | 9:05 am

The FTSE 100 'must bounce' is becoming a desperate mantra

It is difficult to think straight just at the moment as markets continue to tumble across the globe.
Source: Telegraph Finance | 3 Mar 2009 | 9:05 am

OECD urges rich countries to strive for flexibility

Rich countries should redouble efforts to increase flexibility in labour markets and boost competition even though they are suffering the worst recession since the second world war, the OECD said
Source: Financial Times - US homepage | 3 Mar 2009 | 9:00 am

FTSE 100 rebounds from battering

The FTSE 100 rebounded on Tuesday morning after yesterday's plunge led by banks and mining companies.
Source: Telegraph Finance | 3 Mar 2009 | 8:55 am

FTSE rebounds slightly (AFP)

AFP - London's FTSE 100 index of leading shares rebounded slightly at the open on Tuesday, gaining 0.63 percent to 3,648.71 points after slumping by more than five percent to six-year lows a day earlier.

Source: Yahoo! News: Stock Markets News | 3 Mar 2009 | 8:49 am

Northern Rock mortgage arrears soar 394%

Northern Rock, the nationalised bank, today revealed an 394 per cent increase in the number of its customers falling behind on their mortgage repayments by more than three months.
Source: Latest Business News from Times Online | 3 Mar 2009 | 8:24 am

Asia Markets And Europe Open 3/3/2009

jap Markets in Asia were lower.

The Nikkei fell .7% to 7,230.

The Hang Seng dropped 2.1% to 12,062.

THe Shanghai Composte fell 1.1% to 2,071.

In Europe at the open, the CAC 40 was up .7% to 2,500. The Dax rose .6% to 3,732.

Data from Reuters and MarketWtach.

Douglas A. McIntyre

Source: 247 Wall Street | 3 Mar 2009 | 8:23 am

Munich Re scraps 2010 profit target

Munich Re gave notice of the effect of low interest rates on insurers' earnings, scrapping a medium-term profitability target as it warned that expectations for investment returns were no longer achievable...
Source: RSS feed - channel BNPaperBusiness | 3 Mar 2009 | 8:21 am

Shell-shocked investors flee stocks

The Dow falls almost 300 points to close below 7,000 for the first time since 1997.

As stock prices tumble to fresh lows, investment strategy is coming down to this: How much pain can you stand?

Source: L.A. Times - Business | 3 Mar 2009 | 8:00 am

$30 billion more for ailing AIG

Company at the center of the financial crisis had already received $150 billion. Confidence in federal bailouts may be waning.

Reporting from Los Angeles and Washington Martin Zimmerman -- The government gave ailing insurer American International Group Inc. $30 billion more in loans Monday, renewing doubts about the effectiveness of federal bailouts and triggering another avalanche on Wall Street that pushed the Dow index below 7,000 for the first time in a dozen years.

Source: L.A. Times - Business | 3 Mar 2009 | 8:00 am

Will 'Watchmen' be big enough?

Die-hard fans are pumped up for this week's opening, but a lack of strong interest among teenage boys could lower expectations for the Warner Bros. release.

Director Zack Snyder has said he labored to adapt the ground-breaking graphic novel “Watchmen” faithfully, so that comic book fanatics would not be disappointed.

Source: L.A. Times - Business | 3 Mar 2009 | 8:00 am

Assemblywoman Diane Harkey accepted $16,600 from firms borrowing from husband's company

The developers later failed to repay millions of dollars in loans from the lender, Point Center Financial, now target of an SEC probe and an investor suit. Harkey and the firms deny any impropriety.

California Assemblywoman Diane Harkey accepted $16,600 in political contributions from real estate developers who had received loans from her husband's business, now under investigation by the Securities and Exchange Commission.

Source: L.A. Times - Business | 3 Mar 2009 | 8:00 am

Consumer spending rises in January

The 0.6% increase in January is expected to be short-lived as other data offer few signs of an economic recovery.

Consumer spending rose in January after falling for a record six straight months, but the increase was expected to be fleeting given all the problems facing the economy.

Source: L.A. Times - Business | 3 Mar 2009 | 8:00 am

Consumer spending rises in January

The 0.6% increase in January is expected to be short-lived as other data offer few signs of an economic recovery. ...
Source: RSS feed - channel BNPaperBusiness | 3 Mar 2009 | 8:00 am

$30 billion more for ailing AIG

Company at the center of the financial crisis had already received $150 billion. Confidence in federal bailouts may be waning. ...
Source: RSS feed - channel BNPaperBusiness | 3 Mar 2009 | 8:00 am

Redesign of Pepsi logo hard to swallow

The new look raises a question: What were they thinking?

I would rather quaff a flagon of turpentine than drink Pepsi, yet I remain sentimental about the brand. As it happens, Pepsi-Cola was invented in 1898 in my hometown of New Bern, N.C., by pharmacist Caleb Bradham, thus ensuring his place in the history of gout.

Source: L.A. Times - Business | 3 Mar 2009 | 8:00 am

Mexican peso plunges against the U.S. dollar

The currency falls to 15.47 per dollar, a new low, hurt by economic woes north of the border. The Mexican peso...
Source: RSS feed - channel BNPaperBusiness | 3 Mar 2009 | 8:00 am

Cut! Actors take five to Twitter their fans

Celebrities using the blogging site to mold their online image might help the service hit the mainstream. But can it make money?

Some of the actors on NBC's drama "Heroes" are among those in Hollywood who may have the superpowers to help Twitter break into prime time.

Source: L.A. Times - Business | 3 Mar 2009 | 8:00 am

Mexican peso plunges against the U.S. dollar

The currency falls to 15.47 per dollar, a new low, hurt by economic woes north of the border.

The Mexican peso plunged to new lows against the dollar Monday as global investors again rushed for the perceived safety of the greenback despite the horrid U.S. economy.

Source: L.A. Times - Business | 3 Mar 2009 | 8:00 am

Redesign of Pepsi logo hard to swallow

The new look raises a question: What were they thinking? I would rather quaff a flagon of turpentine than drink...
Source: RSS feed - channel BNPaperBusiness | 3 Mar 2009 | 8:00 am

Asia markets gyrate on global financial fears

Fears over the global banking market dragged down shares across Asia overnight, sending Hong Kong’s benchmark Hang Seng below the critical 12,000 mark as Japan's Nikkei briefly headed towards a 26-year low.
Source: Latest Business News from Times Online | 3 Mar 2009 | 7:58 am

Offering help, hope, U.S. "job clubs" see surge

OVERLAND PARK, Kansas (Reuters) - Tom Skidmore has been out of work only since December. But when his former employer filed bankruptcy in January and his severance evaporated, Skidmore knew he didn't have much time. As the sole breadwinner for his family of five, he had to find work fast.

Source: Reuters: Business News | 3 Mar 2009 | 7:55 am

Australian stocks: Market recovers from poor start

MELBOURNE - The Australian share market hit a fresh five-year low on Tuesday, but the central bank's expression of confidence in the Australian economy helped the market recover from a much poorer start. The local bourse dropped...
Source: New Zealand Herald - Business | 3 Mar 2009 | 7:38 am

Oil above $40 after 10 percent fall

SINGAPORE (Reuters) - Oil hovered above $40 a barrel on Tuesday, after slumping 10 percent overnight as the deepening global recession threatened to crimp energy demand further, outweighing OPEC's strong compliance with supply curbs.

Source: Reuters: Business News | 3 Mar 2009 | 7:24 am

February auto sales seen hovering at 27-year lows

DETROIT (Reuters) - Auto sales likely hovered around 27-year lows in February as consumers mostly stayed away from buying big-ticket items, spooked by job losses, the deep recession and tight credit.

Source: Reuters: Business News | 3 Mar 2009 | 7:11 am

February auto sales seen hovering at 27-year lows (Reuters)

Reuters - Auto sales likely hovered around 27-year lows in February as consumers mostly stayed away from buying big-ticket items, spooked by job losses, the deep recession and tight credit.
Source: Yahoo! News: Business | 3 Mar 2009 | 7:11 am

Currency: Dollar climbs above six-year low

The New Zealand dollar consolidated its position today, after touching US49.10c. At 5pm today it was worth US49.68c, up from US49.30c at the same time yesterday. Most of the rise came immediately after the Reserve Bank of Australia...
Source: New Zealand Herald - Business | 3 Mar 2009 | 6:56 am

Toyota's car loan arm asks for $2bn in aid

The financial services unit of the Japanese carmaker has applied for a state-backed emergency funding to help it meet rising credit costs in the US
Source: Financial Times - US homepage | 3 Mar 2009 | 6:50 am

NZ stocks: Market loses another 2.5pc

The New Zealand sharemarket had another bad day today, down more than 2.5 per cent, suffering from a lack of buyers and an overall lack of confidence. The benchmark NZSX-50 index opened at 2481.515 and experienced a big slide in...
Source: New Zealand Herald - Business | 3 Mar 2009 | 6:43 am

Teamsters seeking to organize port truckers

The union protests what it calls the wrongful termination of some drivers as firms at the L.A. harbor move to a new employee model.

About 50 protesters marched into the offices of a Port of Los Angeles freight hauler today and demanded the reinstatement of four truckers who they said were wrongfully terminated.

Source: L.A. Times - Business | 3 Mar 2009 | 6:08 am

Toyota in desperate plea for $2 billion in emergency loans$

The loan-financing arm of Toyota, Japan’s biggest industrial giant, is understood to have approached a state-backed fund for as much as $2 billion in emergency loans.$
Source: Latest Business News from Times Online | 3 Mar 2009 | 6:07 am

5 Vacation Spots Offering Big Discounts (Deal of the Day)

Planning to save money by staying close to home during your vacation? You may want to reconsider your travel plans.

Hotels and airlines are slashing prices and offering discounted package deals on some popular (and warm) destinations, including Hawaii, Orlando, Fla., and the Caribbean. Even better, some winter deals that would normally expire in March are getting extended well into April or May, says Kelly Pelletier, spokeswoman for Kayak.com, a travel search engine.

Faced with a glut of empty hotel rooms and plane seats, the travel industry can't really afford not to be generous with such offers. The International Air Transport Association reported that the world’s major airlines lost up to $8 billion in 2008, far more than the $5 billion it had predicted. And Pricewaterhouse Coopers (PwC) projects an 11.2% decrease in hotel-room revenue during 2009, the biggest drop in more than a decade.

The travel industry's grief can be a traveler's gain. To land the best deal, compare prices online and call the hotels in your price range to see if you can talk them down even further on price (or at least get a room upgrade or other perks thrown in). One useful tactic is to compile a list of the prices or other incentives that competitors are offering so you can use it as ammunition while on the phone.

Also, make sure the reservation can either be cancelled or that the rate can be adjusted to reflect the most recent sales rates. Many hotels are dropping prices a few weeks before the booking date, so you may find a more affordable rate the closer you get to your travel date, says Pelletier.

Here are some of the latest deals you can find at five popular destinations.

1. Las Vegas

Lady Luck may finally be on your side. Las Vegas's tourism industry was one of the first cities to get hit by the recession. Now, up to half of the city’s hotel rooms are empty, says Pelletier. The vacancies aren't just due to casino-shy consumers hanging onto their cash. During the commercial real estate boom, several new hotels were built on the Strip (or areas surrounding it). Now the city is contending with an even larger number of rooms than it's had in recessions past.

Deals:

Palms Casino Resort: Two weekday nights in a deluxe king room or double and round-trip airfare starting at $192 from Los Angeles, $282 from Chicago and $381 from New York (package rates are per person based on double occupancy). Typically, just the room for two weeknights would cost a total of $218.

Mirage Casino: $99 per night in a deluxe room, plus $50 buffet credit through Dec. 30. (Book between March 8 and June 6.) The regular rate for this room is $228 for two weeknights. That price jumps to $388 for the weekend.

The Venetian: Three nights in a luxury room (the hotel’s most basic) and round-trip airfare starting at $239 from Los Angeles and $279 from Chicago or New York. Package includes a $25 credit for drinks. The regular rate for a luxury room: $149 on a weeknight and $189 on weekend nights.

2. Orlando

Disney World's (DIS) famously long lines have all but disappeared as parents cut discretionary costs and keep the kids at home, says Pelletier. To get the Mickey-loving masses to return, most Walt Disney World Resort hotels are offering a seven-night package for the price of four nights -- and they’re throwing in free admission to a Disney park for the entire stay. Typically, seven-day admission costs $228 per person (10 years old and older). Also, those who visit Disney World on their birthdays gain free admission. Getting there is cheaper, too. Round-trip airfare from New York, for example, starts at around $179 on Spirit or Jet Blue, according to Kayak.com.

Deals:

Disney’s Caribbean Beach Resort: Beginning on April 2, spend $2,500 for a five-night package for a family of four (two parents and two children under the age of 10) that includes a six-day entrance to the Disney park of your choice.

Buena Vista Palace Hotel & Spa: From $99 per night for double occupancy in a resort-view guest room with a resort credit of up to $200. Regular room prices start at $199 per night.

Arnold Palmer Bay Hill Club & Lodge: Located just north of Walt Disney World, this Orlando hotel offers standard rooms starting at $97 a night (double occupancy) -- up to 55% off regular room rates.

3. San Francisco

The almost universally-loved City by the Bay isn't feeling so loved right now. Before the recession hit, San Francisco drew business travelers and pleasure seekers alike -- and plenty of hotels popped up to house them. Now, much like Las Vegas, a large portion of those sparkling new accommodations lie empty, says Pelletier.

Deals:

Radisson Hotel Fisherman’s Wharf: Starting at $105 per night for a standard room (15% off original rates).

Cova Hotel (located between the Civic Center and Nob Hill neighborhoods): Starting at $98 per night for a standard room (20% off original price).

4. Hawaii

Say Aloha to warm tropical climates and surfing -- without paying top dollar. Hotels throughout the island state have been lowering prices for the past six months-- and some even throw in free meals and credits, says Pelletier. Just make sure to price airfare first. Few deals include flights, which can be fairly expensive for travelers coming from the East Coast.

Deals:

Aston Aloha Beach Hotel (in Kauai): Starting at $94 per night in a garden-view room and kids eat free. Regular price starts at $120.

Diamond Wailea Resort & Spa (in Maui): Starting at $164 per night, stay three nights in a garden-view suite and get the fourth night free. To get these rates, book by March 31. Regular rates start at $175.

5. The Caribbean

Even though it's peak season, many of the Caribbean's white-sand beaches aren't very crowded, says Scott Berman, principal of hospitality and leisure at PwC. “There’s no question that their performance is uneven and they’re way off of where they were last year,” he says. Find the best packages in bigger markets, like Aruba, Jamaica and the Bahamas, where there are direct flights from the U.S.

Deals:

Grand Palladium Jamaica Resort & Spa: Starting at $499 per person, get four nights in a junior suite, round-trip airfare from the U.S. and most meals, beverages and some water sports included. Book by March 9 for travel between April 13 and June 30. The package is 20% off the normal all-inclusive rate, including airfare.

Marriott Renaissance Aruba Resort & Casino: From $245 per night in the Ocean Suites, get every third night free, a $50 casino credit, a $50 cocktail credit and one breakfast in bed. Regular price to stay in Ocean Suite is $626 a night.

Atlantis (Bahamas): Through May 31, stay four nights for the price of three in a Beach Towers terrace room. Total package costs $1,100 (not including taxes) based on Sunday or Monday arrival. At regular rates, you’ll pay more than $1,506 (not including taxes) for this entire stay. Children 11 and younger stay for free, and you get a $200 rebate when you book a package with airfare for three nights or more.

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Source: SmartMoney.com | 3 Mar 2009 | 5:00 am

Owing on a Cosigned Loan (Ask SmartMoney)

I cosigned for a loan. The person I cosigned for is now filing for bankruptcy. What can I do?
—Janice Wong, Sacramento

Find a way to pay off the loan. You may see this debt as belonging to someone else, but the lender sure doesn’t. “The cosigner is on the hook,” says Craig Watts, spokesperson for credit scorer Fair Isaac. “The bleeding that the other person is going through will seep onto the cosigner’s credit report until it’s resolved.” In fact, even once your cosigner files for bankruptcy—and discharges the debt—you’ll still be held responsible.

Reach out to the lender. While the lender is under no obligation to negotiate, you may be able to stem the damage to your credit report by explaining the situation and committing to a payment plan. This may not seem fair, but “a lot of credit reputations have crashed on the rocks because of so-called moral high ground,” says Watts.

I have a universal life insurance policy as well as a newly renewed term-life policy and additional life insurance through my employer. We’ve saved a considerable amount for retirement, and our children are completing college. Should I cash out the universal policy?
—Marc Green-Lowe, Parkland, Fla.

Life insurance may be sold more aggressively than time-shares in Boca, but its purpose is simply to ensure that your dependents can maintain their current standard of living should you pass away. So ask yourself: Do you need the coverage? Well-funded empty nesters often don’t need much or even any life insurance, although it’s sometimes used for estate planning purposes. (Visit smartmoney.com/insurance to see how much life insurance you need.)

Should you decide to cut back on your coverage, the next question is which policy to drop. Universal life is a type of whole life insurance that combines flexible premiums with a tax-deferred investment component tied to interest rates.

Cashing out of a policy can be pricey, and it’s difficult to determine what sort of investment return you’re giving up, says life insurance expert James Hunt, of EvaluateLifeInsurance.org, which, for a small fee, evaluates the internal investment performance of whole-life policies. Fees for terminating can be in place for up to 20 years, plus you’ll owe income tax if the surrender value (the cash value after fees) exceeds what you’ve paid in premiums. Canceling your employer or term-life plan may make more sense. Talk to a tax pro or fee-only financial planner before making any big moves.

Should I make a 2008 contribution to my Roth IRA or just sock it away in a CD or under my mattress? My Roth has lost money, and I’m planning to retire in four to six years.
—Agnes Soderbeck, Ann Arbor, Mich.

Step away from the mattress. With retirement near, funding your Roth is one of the smartest things you can do. Remember, a Roth IRA is simply a type of account (that offers tax-free withdrawals during retirement). How you invest the account is up to you, whether it’s bonds, stocks, mutual funds or, yes, even CDs. Just keep in mind that your plan is for retirement to begin in the next several years—a happy state of affairs that will likely continue for decades. That means you need some of your account allocated to stocks. If you’re uncomfortable making asset-allocation decisions yourself, consider choosing a target-date retirement fund from a no-load fund family like T. Rowe Price or Fidelity, which will automatically shift your investments to more-conservative options as retirement nears. You can still make your 2008 contribution—$6,000, if you’re 50 or older.

Source: SmartMoney.com | 3 Mar 2009 | 5:00 am

Aus central bank leaves rates unchanged

SYDNEY - Australia's central bank has left its key interest rate unchanged at 3.25 per cent after four consecutive months of cuts to help stimulate the economy. The board of the Reserve Bank of Australia decided today to end the...
Source: New Zealand Herald - Business | 3 Mar 2009 | 4:59 am

Stock markets tumble on bank fears

Stock markets around the world fell to their lowest levels of the economic crisis as a spate of dividend cuts and faltering financial companies shook investor confidence
Source: Financial Times - US homepage | 3 Mar 2009 | 4:55 am

Xtra fined $45,000 after lying to customers

Telecom's Xtra has been fined $45,000 and ordered to pay $10,000 in costs for breaching the Fair Trading Act by lying to its customers. Xtra, New Zealand's largest internet service provider, was convicted in the High Court in Wellington...
Source: New Zealand Herald - Business | 3 Mar 2009 | 3:00 am

Diesel fuel goes along with energy and economy's dive

Prices have fallen to levels last seen in early 2005. Truckers can't enjoy the slide because they have less work.

As gasoline prices drift and oil falters, the diesel fuel that dominates agriculture, rail transport, heavy construction and road hauling is cheaper than it has been in more than four years, the Energy Department said Monday.

Source: L.A. Times - Business | 3 Mar 2009 | 2:48 am

NZX down 2.6pc after Wall St hits 12-year low

New Zealand shares have tumbled more than 2.6 per cent today after stocks in the United States plunged to 12-year lows overnight. The benchmark NZX-50 index is down 65 points, or 2.6 per cent, to 2415, following a fall of 40.8...
Source: New Zealand Herald - Business | 3 Mar 2009 | 2:30 am

Hands off that $130 million - it belongs to my wife: Madoff

Bernard Madoff is seeking to keep a $14 million Manhattan penthouse and an additional $124 million in assets, saying they are unrelated to the fraud that authorities say cost victims more than $100 billion. In court papers filed...
Source: New Zealand Herald - Business | 3 Mar 2009 | 2:00 am

SEC accuses Sunwest Management of fraud (AP)

AP - Federal regulators on Monday accused Sunwest Management Inc., one of the nation's largest operators of assisted-living facilities, and its former chief executive of securities fraud in connection with real estate investments that turned sour.
Source: Yahoo! News: Stock Markets News | 3 Mar 2009 | 1:54 am

Southwest settles unsafe jet complaints

Southwest Airlines will pay $7.5 million to settle complaints that it flew unsafe aircraft, and the fine will double unless the airline completes additional safety measures within a year, federal regulators announced Monday.
Source: Business and financial news - CNNMoney.com | 3 Mar 2009 | 1:47 am

Car makers emphasise green at Geneva show

GENEVA - The Geneva Motor Show will feature more than 130 world premiere presentations as the auto industry tries for a few days at least to dispel some of the gloom clouding its future. And it doesn't get any gloomier than this:...
Source: New Zealand Herald - Business | 3 Mar 2009 | 1:30 am

Obama maps out savvy route to reform

Little could better summarise Barack Obama's approach to governing than his nomination of Kathleen Sebelius as his health secretary while sending aides out to describe Rush Limbaugh, the hard-right conservative talk show host, as the 'leader of the opposition'
Source: Financial Times - US homepage | 3 Mar 2009 | 1:19 am

Pike River Coal forced into $45 million share issue by rock fall

A rock fall deep underground in Pike River Coal's new 108-metre ventilation shaft has forced the company to go to the market to raise $45 million despite a "difficult" global economy. The rock fall two weeks ago has delayed the...
Source: New Zealand Herald - Business | 3 Mar 2009 | 1:00 am

Refinanced Hart on the lookout for packaging buys

Billionaire Graeme Hart has refinanced $3.5 billion in debt and is looking to expand his global packaging business. New Zealand's richest man has indicated he may be interested in Rio Tinto's Alcan Packaging assets. "I'd be...
Source: New Zealand Herald - Business | 3 Mar 2009 | 1:00 am

'Life on hold'

Fears for the future as economic crisis grips Europe
Source: BBC News | Business | World Edition | 3 Mar 2009 | 12:19 am

U.S. SEC charges Sunwest Management with fraud (Reuters)

Reuters - U.S. regulators charged Sunwest Management and its former chief executive with securities fraud on Monday, alleging the retirement home operator lied to investors and eventually operated the business as a kind of Ponzi scheme.
Source: Yahoo! News: Stock Markets News | 3 Mar 2009 | 12:02 am

U.S. SEC charges Sunwest Management with fraud (Reuters)

Gordon Brown heads for Washington with history on his side

Gordon Brown will arrive at the White House today bearing a present for President Obama: a desk ornament carved from the antique oak timbers of HMS Gannet, a ship Britain used to suppress the slave trade in the 19th century.
Source: Latest Business News from Times Online | 3 Mar 2009 | 12:01 am

It's a high price to pay for HSBC's reputation

In HSBC's defence, the purchase of Household International was not obviously mad at the time. Unlike RBS's acquisition of ABN Amro, it was not a wildly overpriced purchase made at what any fool could tell was close to the top of the market.
Source: Latest Business News from Times Online | 3 Mar 2009 | 12:00 am

Need to know: Porsche slows down ... Tesco expands ... EDS wins

View video and Need to Know interactive heatmap
Source: Latest Business News from Times Online | 3 Mar 2009 | 12:00 am

Former CEO sues AIG

Read full story for latest details.
Source: Business and financial news - CNNMoney.com | 2 Mar 2009 | 11:49 pm

Fed credit programs risk independence: Fed's Lacker

ARLINGTON, Virginia (Reuters) - Emergency credit market support from the Federal Reserve has sidestepped Congress and could expose the U.S. central bank to political pressure that hurts its independence, a top Fed policy-maker said on Monday.

Source: Reuters: Business News | 2 Mar 2009 | 11:37 pm

Terra Firma writes off half of EMI buy

Guy Hands has written off half its €2.6bn investment in the music group accepting the likelihood of losses on one of the most eye-catching deals struck during the credit bubble
Source: Financial Times - US homepage | 2 Mar 2009 | 11:33 pm

Broken China?

Exporters feel the force of global slowdown
Source: BBC News | Business | World Edition | 2 Mar 2009 | 11:18 pm

In Brief - Monday

FTI Consulting (FCN), a business consulting firm, said its Q4 EPS fell 3.3% to 58 cents, beating views by 4 cents. Revenue rose 15% to $323 mil....

Source: Investor's Business Daily: BUSINESS | 2 Mar 2009 | 11:08 pm

Business Briefs - Monday

Tower EPS tops, guides Q1 above. The insurer said Q4 EPS increased 5% to 82 cents ex items, beating views by 2 cents. Revenue jumped 21% to $136...

Source: Investor's Business Daily: BUSINESS | 2 Mar 2009 | 11:08 pm

After The Close - Monday

GENZYME (GENZ) said the FDA won't approve its medication Lumizyme to treat Pompe disease until it resolves several issues. The delay may hurt '09...

Source: Investor's Business Daily: BUSINESS | 2 Mar 2009 | 11:08 pm

Trends & Innovations - Monday

Software can foil laptop thieves

Source: Investor's Business Daily: BUSINESS | 2 Mar 2009 | 11:08 pm

Power Line Operator Wants To Connect Wind Turbines To Cities

The wind that whips across the Great Plains states has enough punch to light cities, move commuter trains and run factories. The trouble has...

Source: Investor's Business Daily: BUSINESS | 2 Mar 2009 | 11:08 pm

How the Dow Jones industrials fared Monday (AP)

AP - A relentless sell-off in the stock market Monday blew through barriers that would have been unthinkable just weeks ago, and investors warned there was no reason to believe buyers will return anytime soon. The Dow Jones industrial average plummeted below 7,000 at the opening bell and kept driving lower all day. It was the first close below 7,000 was May 1, 1997.

Source: Yahoo! News: Stock Markets News | 2 Mar 2009 | 11:01 pm

Uncle Sam to dole out more college loans

Source: Business and financial news - CNNMoney.com | 2 Mar 2009 | 10:55 pm

Worst year for dividend cuts since 1938

US investors are facing the worst year for dividend cuts since 1938, data from Standard & Poor's have forecast, as a growing tally of blue-chip companies across the globe slash pay-outs for investors
Source: Financial Times - US homepage | 2 Mar 2009 | 10:37 pm

Write-Offs: 03.02.09

$$$ Strong Bets on Private-Party MBS [Housing Wire]

$$$ SheBair: "US govt won't run large firm for extended time" [Reuters]

$$$ Peter Kraus says (via webcast): Layoffs for Alliance Bernstein at the end of March.

$$$ Jeep Incapable Of Selling To Man With $24,000 In Cash [Consumerist]

Source: Dealbreaker | 2 Mar 2009 | 10:32 pm

Global stock markets dive on financial fears (AFP)

AFP - Global stock markets plunged Monday, hammered by fresh fears over the fate of some of the world's biggest financial companies in the midst of a spreading economic crisis.

Source: Yahoo! News: Stock Markets News | 2 Mar 2009 | 10:16 pm

Hear: What If We Let AIG Fail?

Calling on the main line in Fishersville, Virginia. BakerMonkey/Planet Money Flickr pool

On today's Planet Money:

-- Quick: If anyone had asked you six months which company Americans should save first in an economic crisis, would you have named AIG? As of today, taxpayers are on the hook for well over $100 billion to prop up the ailing insurer. But what if the U.S. hadn't decided to rescue AIG? Gregg Berman of Risk Metrics considers an alternate scenario.

-- Our favorite economic indicator, the TED spread, has lately lost some of its luster. It's been stuck in the neighborhood of one, and yet the economic crisis drags on. Now we're starting a search for new indicators with one from currency strategist of Marc Chandler of Brown Brothers Harriman: margin debt at the New York Stock Exchange.

Bonus: A TED spread question, after the jump.

Alisa writes:

What's happening with the TED spread?

The TED spread ticked up over 1 today, for the first time since Jan. 12. A key measure of banks' axiety, the TED spread measures the difference between three-month Libor (the London Interbank Offered Rate) and the interest on a three-month T-bill.

In normal times -- remember those? -- the TED spread is well below one. At the height of the credit crisis, in October, it reached 4.6.

Why the new spike?

When the stock market goes down, as it did by almost 300 points todaytoday, bonds tend to go up. That's because investors head for the security of government bonds.

The government borrows money by selling U.S. Treasury bills (see "Government Debt for Beginners"). If the Treasury has more people clamoring to buy T-bills, it can sell them for higher prices -- meaning taxpayers can borrow money at lower rates. It's a better deal for taxpayers, a worse one for investors.

As the interest on T-bills falls, it's less able to offset LIBOR -- and so the TED spread is higher.

Bonus: Treasurys rise on AIG, economy

Download the podcast; or subscribe. Intro music: OK Go's "No Sign of Life." Find us: Twitter/ Facebook/ Flickr

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Source: NPR Blogs: Planet Money | 2 Mar 2009 | 10:04 pm

Snowflake Needs A New Pair Of Shoes

American International Group Inc., which reported the biggest loss by a publicly traded U.S. firm, was sued for securities fraud by former Chief Executive Officer Maurice "Hank" Greenberg.

Greenberg filed his suit today in Manhattan federal court, saying the company's "material misrepresentations and omissions" caused him to acquire AIG shares in his deferred compensation profit participation plan at an inflated valued.

Maurice Greenberg Sues AIG, Saying Its Shares Were 'Inflated' [Bloomberg]

Source: Dealbreaker | 2 Mar 2009 | 10:03 pm

Presented Without Comment: Trade Nominee Ron Kirk Agrees To Pay Back Taxes

The Senate Finance Committee says President Barack Obama's nominee for trade representative owes roughly $10,000 in back federal taxes and has agreed to pay them. The report said Ron Kirk will file amended returns covering the years 2005, 2006 and 2007.
Kirk becomes the latest nominee of the Obama administration with tax problems, although this one doesn't appear severe enough to jeopardize his confirmation as U.S. Trade Representative. Committee chairman Sen. Max Baucus of Montana calls the former Dallas mayor the right man for the job, adding he will try to move the nomination quickly.

Trade nominee Ron Kirk agrees to pay back taxes [AP]

Source: Dealbreaker | 2 Mar 2009 | 9:49 pm

Brooking's Gale Says 2010 Budget Politically Risky For Obama

Source: Bloomberg - All Podcasts | 2 Mar 2009 | 9:46 pm

Poland renews pledge to join euro early

Poland reiterated its commitment to bid for accession to the eurozone amid signs the financial crisis has prompted EU leaders to consider shortening the entry process
Source: Financial Times - US homepage | 2 Mar 2009 | 9:40 pm

HSBC unit 'destroyed' $10bn

The UK lender revealed its consumer finance division will require further capital injections for several years and plans to close down 800 US branches in an effort to draw a line under the business
Source: Financial Times - US homepage | 2 Mar 2009 | 9:16 pm

Turkcell Cut to `Neutral' at HSBC

Source: Bloomberg - All Podcasts | 2 Mar 2009 | 9:14 pm

Collender Says Obama's Economic Forecast Is `Optimistic'

Source: Bloomberg - All Podcasts | 2 Mar 2009 | 9:14 pm

Letting Eastern Europe Burn

You sort of knew the Germans were going to be pissed. Every time something happens in Central or Eastern Europe all eyes get Teutonic twinkles and the likes of Angela Merkel start getting fruit baskets in the mail. What's the problem this time? Cheap mortgages funded with the carry trade (we tried to borrow Canadian dollars but people only laughed), declining demand for the exports headed to the West, declining currencies. All in all, "a New Iron Curtain," is said to be descending. Very dramatic. Probably not the reference to use on Germany, when coming from the East, you understand.

In a way you can almost think of an East Europe bailout as a proxy for mortgage and homeowner bailout plans in the United States. Unlike the United States, however, it doesn't look like billions are going to be tossed at the problem in hopes the bubble might re-inflate. This isn't because of any particular moral fiber on the part of Western Europe. Rather, developing a mandate there is about like herding cats... into a doberman infested bathtub.

EU Rejects a Rescue of Faltering East Europe [The Wall Street Journal]

Source: Dealbreaker | 2 Mar 2009 | 8:33 pm

Fairfield Greenwich's Biggest Sin

Picture 801.png Hey, did you know Fairfield Greenwich founder Walter Noel, his wife Monica and their five daughters are deeply garish human beings? And are so thoroughly hated in CT that their WASP neighbors and "friends," who generally remain contained within their personal Cheeveresque hells, will make exception to get their knickers in a twit over the nouveau riche family, raising their body temperatures, which for the most part hover around 73.5 degrees Fahrenheit, to 77.9? Of course you did but Vanity Fair has a few more details.

The Noels' vast house on Mustique, named Yemanjá, was featured--along with the Noel women--in a cover story in Town & Country in 2005. Coming after a 2002 feature in this magazine, headlined "Golden in Greenwich," it gave ammunition to people who believed that the Noels were shameless self-promoters. (Monica has told people that she agreed to the Town & Country feature only because she believed that it would increase the value of the house.)

One friend from Greenwich was astonished by the stories she heard about them in Southampton, where they bought a $10 million house in 2001. They grated on local society by taking out an entire page in the "Blue Book"--the local social register of the Hamptons. "You don't have to put every single cell phone, and every single child, and every single number. They live in Europe, they live in South America; it wasn't necessary to put down 43 names," says an observer.

They wasted no time in applying to join the beach club officially known as the Bathing Corporation of Southampton, where Philip Toub's father, Said Toub, is a member. But older members, who expect young women to appear in Lilly Pulitzer dresses, say they were put off when the Noel women showed up in "thongs and sarongs."

Also, they table-hopped--which offended members. Some people said Walter Noel networked on the beach. "What I heard is he was actually selling the Fairfield Greenwich fund, or trying to encourage other members of the beach club to buy it, because it was an incredible thing, and he was almost using that as currency, if you will, to garner a favor," says a man in that world.

Another person who spends time in Southampton recalls, "They really did things that seemed outlandish. The first summer they were here, I won't forget seeing two of the daughters blocking traffic on Jobs Lane, leaning out of their convertibles, talking to each other and making what sounded like idle plans and blowing kisses, as if they owned the street--literally for five full minutes while a line of too-polite-to-honk Southampton matrons sat in silence."

Walter also tried to get into the Shinnecock Hills Golf Club, "but that died fast once Monica had a personal assistant call around to Shinnecock members inviting them to their house," says this person. "It's just not friendly to have your personal assistant call around to old club members inviting them over for a meal.... It smacked both of new money and being almost purposefully rude. Joining a club like Shinnecock is like joining a family. It's not expensive, but the waiting list is very long because it's very selective in inviting people to join who would fit in, in as gemütlich a way as Wasps can get. None of the members, even if they had personal assistants--which most of them are too poor to have--would use them to make a personal social call."

So yeah: crooks, maybe, but way more importantly, if you care about this sort of thing, gauche. Now that that's been re-established, please turn your attention to this, also from VF:

Source: Dealbreaker | 2 Mar 2009 | 8:04 pm

Presented By:

Source: Dealbreaker | 2 Mar 2009 | 8:04 pm

McCain Discusses Iraq, Afghanistan Obama's Policies

Source: Bloomberg - All Podcasts | 2 Mar 2009 | 7:31 pm

Indicator: Margin Debt Falling

Margin Debt at the NYSE courtesy of Margaret Kempner at Brown Brothers Harriman

If you think of the current economic crisis as the result of people and businesses borrowing too much, then you can think of the cure as getting rid of that debt. That's the view from Marc Chandler, currency strategist at Brown Brothers Harriman.

Chandler has been looking for signs that debt is going away, either by people paying it off or lenders giving up and writing it off.

One of his favorite signs: margin debt at the New York Stock Exchange. Margin debt basically means money borrowed to buy stock. The number for January just pinged in, and it's down again. Which shows continued crisis or ongoing recovery, depending on how you look at it.

We're aiming to have more on this alternate indicator for the podcast today.

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Source: NPR Blogs: Planet Money | 2 Mar 2009 | 7:27 pm

Ron Insana: Hero

Picture 800.png So, I don't think we were alone in wondering if Ron Insana's presence around CNBC today was indication that his follow-up to SAC Capital was gonna be a full-time return to the peacock. If it was, we were hoping somea the kinks would be worked out, 'cause the interactions with his former colleagues were nothing short of downright awkward. (The Power Lunch gang was all smiley and so happy to have their local boy back from the big city, but things just feel so different, and nobody knows how to act and will they ever get their groove back, or can you really never go home again?).

Then we realized all the uncomfortable fumbling and the "where does this go?" and the overwhelming feeling that RonIs has just outgrown the place and is too good for his old friends was a build up to a glorious bubble-bursting finish. During his last few minutes on air, in response to the Bill/Sue/Michelle/Dennis creaming it over the fact that Warren Buffett will be answering viewers' questions via e-mail, Insana noted, "Well, it'd probably just be easier to get him on the phone," with a little smirk meant to indicate he can. Cause, ya know, while the PL crew's been Talking Head-ing it up, Ronnie-boy has been flourishing under the tutelage of the fleece king of Conn, and has WB on speed dial.

Someone needs to send us a screen shot of the look on Buemichennis's faces because never have they been so thoroughly bitch-slapped and by one of their own, not even Charlie Gasparino. The mouths agape, the failed attempts to catch their bearings, the stuttering to come up with a comeback, the internal "OMFG I can't believe he just said that doesn't he know he's supposed to kiss our asses for having email access to WB?!" I'm not exactly sure who's to thank for this big-shot attitude,* but we have our guesses which is why someone in Stamford should be looking out for a couplea boxes of Girl Scout cookies on us, this afternoon.

*Not a criticism. We want to see more of this 'tude on the network.

Source: Dealbreaker | 2 Mar 2009 | 7:11 pm

Food processes slow down Tanzania

In Tanzania, 80% of the population works in agriculture. But high global food prices aren't exactly helping Tanzanians. Many are still poor because much of their home-grown food goes to waste. Gretchen Wilson reports.
Source: Marketplace | 2 Mar 2009 | 7:05 pm

Politics may strain health care reform

A big portion of President Obama's stimulus package is directed at increasing health coverage for more Americans. But commentator Edward Miguel says the new focus on fixing health care will put stress on Obama's bipartisan pledge.
Source: Marketplace | 2 Mar 2009 | 7:05 pm

Hospitals ailing with financial stress

Even hospitals aren't immune to the recession. A new study finds that most hospitals are feeling financial strains. Janet Babin reports.
Source: Marketplace | 2 Mar 2009 | 7:05 pm

Why does AIG keep losing money?

AIG is collecting $30 billion more from the government to add to its hefty $150 billion tab. And the insurance giant reported losing nearly $62 billion in the fourth quarter. Why is it losing so much money? Steve Henn reports.
Source: Marketplace | 2 Mar 2009 | 7:05 pm

Frugal is the new cool

The recession is causing people to talk more openly about money. It's also helping people be more frugal. Kai Ryssdal speaks with behavioral economist Dan Ariely about why it's a good thing people are saving.
Source: Marketplace | 2 Mar 2009 | 7:04 pm

Visa hopes ad change will charge sales

Credit card companies are feeling the effects of the recession. To get people to swipe more of its debit cards, Visa is launching a new ad campaign that focuses on everyday spending needs. Rico Gagliano reports.
Source: Marketplace | 2 Mar 2009 | 7:04 pm

Saving more slows economic recovery

Government figures show that Americans are saving more disposable income. While saving may be good in the long run, it's not helping to kick-start the ailing economy. John Dimsdale reports.
Source: Marketplace | 2 Mar 2009 | 7:04 pm

A division in Europe over economic fund

Some Eastern European countries want Western Europe to create a multibillion-dollar fund to help their struggling economies. Kai Ryssdal speaks with London Bureau Chief Stephen Beard about how the idea is causing a divide between East and West.
Source: Marketplace | 2 Mar 2009 | 7:04 pm

Ken Lewis To Be Government Employee For Life

The Boone's is flowing early this morning in Charlotte, and you know what that means-- drunk dial time! Ken Lewis apparently got the Financial Times on the horn and had a few things to say, in (most likely) rambling incoherent slurs cleaned up for print. A. Though Merrill is a star, and that deal was a "thing of beauty," it was a "tactical mistake" to request $20 billion of gov money to help out on the acquisition, cause it put BAC "in the same category as Citigroup" and nobody wants that, am I right? 2. In retrospect, he should've only asked for $10 billion but an "abundance of caution" led him to go that extra mile and D. You're going to have drag his dead lifeless body out of the place, because brother has declared that despite calls for his resignation, peacing in BofA's time of need is not something he's considered "for one second" and he's not going anywhere 'til the TARP money is repaid. "It would be very easy to disappear into the sunset," Lewis said before falling off his desk chair. "But we have to slug through this."

Source: Dealbreaker | 2 Mar 2009 | 6:47 pm

Where In The World Is Tim Geithner?

Maybe it is just us, but we seem to have been seeing quite a bit less of the elven safecracker lately. Why, do you suppose, that is? Has he just been talking very quietly? Have the forums he's been frequenting been microphone-less? Is he actually missing? Just working very hard (bet you thought the hours were going to improve in that cushy government spot, eh)? Perhaps some horrible skin condition prevents his appearance on television?

Preferring not to have to cull the networks for video archive footage with time and date stamps, we'll just ask you to report your "safecracker sightings" in comments. Where in the world is he?

Source: Dealbreaker | 2 Mar 2009 | 6:28 pm

Could Citi Break The Buck?

$1.19 at the moment. Not far now.

Source: Dealbreaker | 2 Mar 2009 | 6:21 pm

BofA chief admits Merrill aid 'mistake'

Bank of America's request for $20bn of government money to prop up its acquisition of Merrill Lynch was a "tactical mistake" that made the bank appear as weak as Citigroup, Ken Lewis, BofA's chief executive told the Financial Times
Source: Financial Times - US homepage | 2 Mar 2009 | 6:14 pm

Confessions of A Money Guru

GQ "Men + Money" columnist Joel Lovell has a refreshingly honest column in the Washington Post today about how difficult it is right now to give financial advice. He writes:

Should you jump into the market now and buy low? Should you keep everything in cash for the next year or two or five? Should you invest in China or natural gas or gold? Beats me. I've been writing this column for about a year and a half, so I've done my research, talked to a bunch of investment analysts and made an effort to understand what's going on now and where we might be headed. But really, I can't begin to claim to know.

And when I think back on the advice I've given and realize that my readers would have been far better off if each month I'd said, "You know what, let's stick with Plan A and just stuff our money into a satchel and bury it beneath the swing set" -- well, it makes me feel like a bit of a fraud.

Admittedly, GQ may not be the magazine people turn to first for financial advice, and Joel Lovell is not a studied economist or lifelong financial guru -- a recent New York Observer article labeled him "the anti- Jim Cramer." But at a time when so much in the economy is uncertain, it's still nice to hear that someone charged with dispensing advice is having some anxiety.

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Source: NPR Blogs: Planet Money | 2 Mar 2009 | 5:46 pm

Bandholz Says ISM Report Good Indicator of `Dire' U.S. Economy

Source: Bloomberg - All Podcasts | 2 Mar 2009 | 4:44 pm

Prechter Sees Sharp Rebound After Stock Market Low

Source: Bloomberg - All Podcasts | 2 Mar 2009 | 4:38 pm

NYU's Altman Favors `Good Bank, Bad Bank' Solution to Crisis

Source: Bloomberg - All Podcasts | 2 Mar 2009 | 4:35 pm

Levitt Says Fiscal Rescue Should Be `Less Tentative'

Source: Bloomberg - All Podcasts | 2 Mar 2009 | 4:21 pm

Lewis-Davies Sees Higher Oil Prices by End of Year

Source: Bloomberg - All Podcasts | 2 Mar 2009 | 4:17 pm

5 Ways to Boost Your Credit Score

credit-card

Credit concerns got you down? If you’re worried about your credit score, rest assured there are easy ways to improve it. Try these five tips to boost your credit score:

1. Use credit cards. No credit history is just as bad as a horrible credit history. If credit cards make you nervous, only use yours to pay off a monthly bill, or when you go out to eat. Manageable debt is better than not having a credit score at all.

2. Keep your balances small to nonexistent. Don’t max out your cards unless you can pay them back down quickly. Use half or less of the full balance on each card when you make purchases. Keeping balances near the maximum will negatively affect your credit score.

3. Avoid late payments. Serial late payments can trash your credit score. Pay down the minimum amount each month, if not more. (Note: Many credit card companies will wipe your first late payment off your records if you say it was an accident. After that, you’re on your own.)

4. Avoid acquiring too many credit cards. Not only does this complicate your debt life, but it reflects badly on your credit score. There’s no ideal number of credit cards, but try to keep it below six (including store cards).

5. Do not open more than one credit card at a time (this lowers your accounts’ average age), or close too many credit cards (resulting in less credit available). Both actions reflect poorly on your credit rating.

Honorable mention: Don’t declare bankruptcy–it will ruin your credit for up to a decade.

Source: Business Pundit | 2 Mar 2009 | 4:14 pm

Small Business Slowdown

Inspired by Friday's indicator from architect Celeste Lewis, Jon from Southern California sends one of his own:

My wife runs a small wedding and event coordinating business in Southern California. We would annually spend about $5-10K for marketing efforts, including last year and we would typically do 4-6 weddings at least a year, with a budget range of $35-85k.

For us, it started to slow down last summer, we went from 2-4 inquiries a month, to maybe one legitimate inquiry or referral by September. (an average year would see 25-35 inquiries, and 4-6 bookings). Since the first of October, her company has not had a single inquiry for full wedding coordination (where she works on the project for 6 months to a year doing pretty much everything for the client), which is really what her business specializes in.

We've seen a 25% drop in web traffic, and as stated above, a virtual 100% drop in clients. We're definitely one of the businesses that are looking at wrapping our (now last) client in May, and shutting down the business. What was once a market (for better or worse...haha) that seemed largely fueled by people taking out home equity lines of credit for their extravagant weddings, is for all intensive purposes, gone. My wife and I started talking about this in late 2007, and kind of saw it coming, but it's still... well, just another indicator, I suppose.

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Source: NPR Blogs: Planet Money | 2 Mar 2009 | 3:34 pm

15 New Ben & Jerry’s Flavors to Celebrate the Financial Crisis

zzbjs

Ben & Jerry’s recently created a flavor called “Yes Pecan!” to celebrate Barack Obama. Here are a list of 15 flavors Ben & Jerry’s should use to honor the financial crisis:

15. Grape Depression

14. Cluster Fudge

13. Nut’n Accomplished

12. The Reese’s-cession

11. The Housing Crunch

10. Credit Crunch

9. Half Broke

8. Chocolate Chip Cookie (Sorry, we ran out of dough)

7. Bailout Berry Sorbet

6. New York Super Fudged Junk

5. Seven Trillion Layer Bar

4. Mint Fed Funk

3. Nougalar Financial Disaster

2. Neapolitan-Sized Mess

1. Bankers on the Run

Source: Business Pundit | 2 Mar 2009 | 3:15 pm

Go Ahead And Be Mad

The news this morning ranges from a Dow that fell below 7,000 for the first time since 1997 to an Eastern European financial crisis that just won't quit.

But the big, big, big news is all AIG. The numbers are U-G-L-Y: The insurer reports a loss of $61.7 billion in the fourth quarter of 2008, the worst loss in corporate history. Fearing a devastating domino effect, the Federal Reserve and the Treasury have announced $30 billion at the ready to prevent the end of the world as we know it.

Yesterday, I talked to someone I know who works at the Fed. This person recommended Joe Nocera's column Saturday in the New York Times. Look, the person said, the Federal Reserve is still confident that it can get ahead of the overall financial crisis, though it will cost an amazing amount of money. And yes, the Fed staffer said, the situation with AIG should make everyone mad. Nocera may have put it best:

Other firms used many of the same shady techniques as A.I.G., but none did them on such a broad scale and with such utter recklessness. And yet -- and this is the part that should make your blood boil -- the company is being kept alive precisely because it behaved so badly.

This is officials' fourth pass at propping up AIG. The company continues to report losses as the value of its holdings continues to fall. In addition to those writedowns, the company is burning up cash. Taxpayers had already invested some $150 billion in AIG, for an ownership stake of just under 80 percent. The Federal Reserve will now take a share of two AIG businesses, the Asia-based American International Assurance Co. and American Life Insurance Co., which operates in 50 countries.

The Federal Reserve is not trying to save AIG so much as keep it from taking out the rest of the global economy in a catastrophic collapse. This is a story of amazing complexity. We're aiming to drill down into part of it for today's podcast. Stick with this. It's worth understanding.

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Source: NPR Blogs: Planet Money | 2 Mar 2009 | 2:41 pm

Geithner Analysis

I love that our interview with Treasury Secretary Tim Geithner has its own life as an object of analysis.

Steve Waldman has an interesting take.

I felt sorry, at a personal level, for our Treasury Secretary, a very smart man imprisoned in a series of talking points, desperately afraid of the consequences of holding an honest conversation.

and

Mr. Geither's unspoken assumption is that fixing our financial system implies ensuring that incumbent troubled financial institutions are "strong". But that's not right. Our financial system is composed, in part, of financial institutions, but it is supposed to be larger and more robust than any specific firm.

Our friends at Baseline Scenario had more thoughts, these from James Kwak.

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Source: NPR Blogs: Planet Money | 2 Mar 2009 | 1:01 pm

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