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Wolseley reports 80% drop in profits Profits at Wolseley, the building supplies company which owns the Plumb Center and Builder’s Centre builders merchants chains, fell by 80 per cent in the nine months to May amid "weaker markets." Source: Latest Business News from Times Online | 28 May 2009 | 1:17 pm Opening Bell: 05.28.09 PPIP Founders (WSJ) Shocker: "A government program designed to rid banks of bad loans, part of a broader effort once viewed as central to tackling the financial crisis, is stalling and may soon be put on hold, according to people familiar with the matter." Citi, SEC In Talks To Settle Asset Probe (WSJ) "Citigroup Inc. is in the early stages of negotiating with the Securities and Exchange Commission to settle an investigation into whether it misled investors by not properly disclosing the amount of troubled mortgage assets it held as the market began to implode in 2007, people familiar with the matter say. The talks signal that the SEC could be moving toward resolving a number of civil probes that began in late 2007, when mortgage-related losses began mounting on the books of banks and Wall Street firms. A Citigroup spokesman said the firm's policy isn't to comment on such regulatory issues." Fortress Takes First Steps Into Retail Banking (FT) "Fortress Investment Group, a listed private equity and hedge fund company with $26.5bn in assets, is nearing an agreement that would mark the first step in a push into US retail banking, according to people familiar with the transaction. Under a deal that could be announced as early as Thursday, Fortress and other investors - including private equity firms Crestview Partners and Lightyear Capital - will inject $800m in fresh capital into a small Florida bank called First Southern." Bank Czar Likely (WSJ) "The new bank regulatory agency could prove controversial because it would consolidate the Office of the Comptroller of the Currency and the Office of Thrift Supervision and strip supervisory powers from the Federal Reserve and the Federal Deposit Insurance Corp. The Fed and the FDIC would gain other powers, though, as White House officials want the Fed to be able to oversee systemic risks in the economy. They also want the FDIC to have new powers to take large financial companies that aren't banks into receivership." We'll See A Target Vote Today (Reuters) "In an increasingly heated proxy contest, Ackman is seeking enough shareholder votes to win five seats on the retailer's board, while Target is running a slate of four incumbent directors. Shareholders will also have to vote on the size of the board -- Target wants to set it at 12, while Ackman claims it should be 13." Related: Office of Thrift Supervision - Office of the Comptroller of the Currency - Business - Federal Deposit Insurance Corporation - Hedge fund Source: Dealbreaker | 28 May 2009 | 1:10 pm Stock futures rise modestly after economic data (AP) AP - The stock market is headed for a slightly higher open after more economic data suggested the economy is stabilizing. Source: Yahoo! News: Stock Markets News | 28 May 2009 | 12:44 pm Costco profit hit by costs, dollar, sales miss Costco Wholesale Corp. reports fiscal third-quarter profit fell 29%, hurt by a stronger dollar, a litigation settlement and employee healthcare costs. Source: MarketWatch.com - Top Stories | 28 May 2009 | 12:39 pm 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 | 28 May 2009 | 12:31 pm Economic Report: April durable goods surprise to upside WASHINGTON (MarketWatch) -- New orders for U.S.-made capital goods were much stronger than expected in April, a possible signal that the decline in capital spending may be coming to an end. Source: MarketWatch.com - Top Stories | 28 May 2009 | 12:31 pm Economic Report: Initial jobless claims fall to 623,000 The number of new layoffs declines by 13,000 to 623,000 last week, while the number of people collecting state unemployment benefits rise by 110,000 to a record 6.79 million. Source: MarketWatch.com - Top Stories | 28 May 2009 | 12:31 pm Debt fears cloud economic recovery picture LONDON/SINGAPORE (Reuters) - The pace of economic decline in western Europe is slowing, data showed on Thursday, though activity is still very subdued and prospects for a global recovery are being hurt by the rising cost of borrowing money. Source: Reuters: Business News | 28 May 2009 | 12:28 pm Broken dreams Falling off Indonesia's economic ladder Source: BBC News | Business | World Edition | 28 May 2009 | 12:27 pm Stock futures slightly higher ahead of key U.S. data NEW YORK (Reuters) - Stock index futures pointed to a higher open on Wall Street on Thursday ahead of key U.S. durable good orders and new home sales data, while the market eyed General Motors as it slid closer to bankruptcy. Source: Reuters: Business News | 28 May 2009 | 12:26 pm Stock futures slightly higher ahead of key U.S. data (Reuters) Reuters - Stock index futures pointed to a higher open on Wall Street on Thursday ahead of key U.S. durable good orders and new home sales data, while the market eyed General Motors as it slid closer to bankruptcy. Source: Yahoo! News: Business | 28 May 2009 | 12:26 pm Stock futures slightly higher ahead of key U.S. data (Reuters) Reuters - Stock index futures pointed to a higher open on Wall Street on Thursday ahead of key U.S. durable good orders and new home sales data, while the market eyed General Motors as it slid closer to bankruptcy. Source: Yahoo! News: Stock Markets News | 28 May 2009 | 12:26 pm Nortel seeks buyer for stake in LG venture Nortel Networks, the Canadian telecommunications equipment company operating under Chapter 11 bankruptcy protection, confirmed it is seeking a buyer for its controlling stake in LG-Nortel, the company's South Korean joint venture Source: Financial Times - US homepage | 28 May 2009 | 12:24 pm Oil holds above $63 as OPEC keeps output unchanged LONDON (Reuters) - Oil held above $63 on Thursday after OPEC ministers meeting in Vienna decided, as widely anticipated, to leave the group's crude output unchanged at 24.85 million barrels per day. Source: Reuters: Business News | 28 May 2009 | 12:23 pm Yahoo: For 'boatloads' we'll sell Carol Bartz said she's willing to sell Yahoo's search business - or all of Yahoo - for 'boatloads' or 'big boatloads' of money, respectively. But that doesn't mean there'll be a sale. Source: Business and financial news - CNNMoney.com | 28 May 2009 | 12:19 pm Hewlett Packard to cut 840 jobs Electronics firm Hewlett Packard is to cut hundreds of jobs at a Scottish plant and transfer the work to the Czech Republic. Source: BBC News | Business | World Edition | 28 May 2009 | 12:11 pm Battered retailers expect pain to continue British retail sales fell by a larger than expected margin in May and shopowners expect little improvement next month, according to the CBI. Source: Latest Business News from Times Online | 28 May 2009 | 12:08 pm Good News on the Mortgage Mess (BusinessWeek Online) BusinessWeek Online - Smart shoppers for used cars know how to avoid lemons. Now buyers of residential mortgage-backed securities are likewise learning how to distinguish the bad from the good. That bodes well for healing housing finance. Source: Yahoo! News: Business | 28 May 2009 | 12:08 pm Toys R Us acquires high-end retailer FAO Schwarz (AP) AP - Toys R Us Inc. announced early Thursday that it had bought troubled high-end retailer FAO Schwarz, which has struggled for years through bankruptcies amid tough competition from discount stores. Source: Yahoo! News: Business | 28 May 2009 | 12:03 pm Discounts boost Japan retailers Retail sales in Japan rose in April for the first time in eight months after successful discounting at department stores and supermarkets. Source: BBC News | Business | World Edition | 28 May 2009 | 12:01 pm Fenwick & West's Silicon Valley Venture Capital Survey Reveals Significant Decline in Valuations in First Quarter of 2009 MOUNTAIN VIEW, Calif., May 28 /PRNewswire/ -- Fenwick & West LLP, one of the nation's premier law firms providing comprehensive legal services to high technology and... Source: RSS feed - channel BNewsBusiness | 28 May 2009 | 12:00 pm Arbitron Inc. Announces Quarterly Cash Dividend COLUMBIA, Md., May 28 /PRNewswire-FirstCall/ -- Arbitron Inc. (NYSE: ARB) today announced that its Board of Directors has approved the payment of a quarterly cash dividend of... Source: RSS feed - channel BNewsBusiness | 28 May 2009 | 12:00 pm The Bank of New York Mellon's Pershing Unit Awarded Bronze Medal by American Society for Quality JERSEY CITY, N.J., May 28 /PRNewswire-FirstCall/ -- Pershing LLC, a subsidiary of The Bank of New York Mellon Corporation (NYSE: BK), announced today that it has received a... Source: RSS feed - channel BNewsBusiness | 28 May 2009 | 12:00 pm Corporate Attorneys Say Practice Area Expertise Key When Choosing a Law Firm MENLO PARK, Calif., May 28 /PRNewswire/ -- Rather than trying to be all things to all people, the best way for law firms to attract new corporate clients is to emphasize their... Source: RSS feed - channel BNewsBusiness | 28 May 2009 | 12:00 pm Greenhill SAVP Completes Investment in Mobile Commons NEW YORK, May 28 /PRNewswire/ -- Greenhill SAVP announced today it has invested in Mobile Commons, Inc. ("Mobile Commons"). Greenhill SAVP led the Series A financing... Source: RSS feed - channel BNewsBusiness | 28 May 2009 | 12:00 pm Global 8 Environmental Technologies, Inc. Strengthens Team With New CEO Appointment Board of Directors unanimously approves appointment of accomplished executive and environmentalist Julio Ferreira NEWPORT BEACH, Calif., May 28... Source: RSS feed - channel BNewsBusiness | 28 May 2009 | 12:00 pm Movers & Shakers: Thursday's biggest gaining and declining stocks Stocks expected to move significantly in trading on Thursday include Big Lots, Costco, DSW, Exelixis, Heinz, Time Warner and TiVo. Source: MarketWatch.com - Top Stories | 28 May 2009 | 11:59 am SEI to Hold Investor Conference Public Invited to Monitor Webcast OAKS, Pa., May 28 /PRNewswire-FirstCall/ -- SEI Investments Company (Nasdaq: SEIC) will present a live webcast of its annual... Source: RSS feed - channel BNewsBusiness | 28 May 2009 | 11:58 am Sealy Corporation Announces Launch of Rights Offering TRINITY, N.C., May 28 /PRNewswire-FirstCall/ -- Sealy Corporation (NYSE: ZZ) announced the filing of the prospectus supplement relating to its previously disclosed rights... Source: RSS feed - channel BNewsBusiness | 28 May 2009 | 11:55 am Visteon files for Chapter 11 Auto parts maker Visteon says it and some of its U.S. subsidiaries have filed for Chapter 11 bankruptcy reorganization. Source: MarketWatch.com - Top Stories | 28 May 2009 | 11:55 am CORRECTED - CORRECTED-UPDATE 1-Leap Wireless raises size of share offering (Corrects paragraph 5 to say that the company's shares closed on Wednesday, not Thursday) Source: RSS feed - channel BNewsBusiness | 28 May 2009 | 11:54 am Opel talks break down in Berlin Talks about the future of Opel and Vauxhall break down after more details emerge of the amount of extra cash it needs. Source: BBC News | Business | World Edition | 28 May 2009 | 11:53 am OPEC resists the temptation to cut production quotas OPEC has resisted the temptation to reduce the amount the oil cartel produces this year banking instead that demand for crude will steadily rise during 2009. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 28 May 2009 | 11:51 am Opel talks stall on GM financing demand The future of Opel hung in the balance after top-level talks led by Berlin aimed at securing a bail-out failed after the General Motors demanded €300m Source: Financial Times - US homepage | 28 May 2009 | 11:46 am Opel race narrows to two but still no funding deal BERLIN/DETROIT (Reuters) - As the battle for German carmaker Opel effectively narrowed to a race between Fiat and Magna, overnight talks to shield Opel from General Motors' looming bankruptcy ended with no deal. Source: Reuters: Business News | 28 May 2009 | 11:44 am Lazy Road Worker Source: Business Pundit | 28 May 2009 | 11:42 am After the selloff, Treasurys rebound The price of government debt rebounded Thursday morning ahead of the last of three major auctions and the day after a massive sell off in the Treasury market that spilled over into Wall Street. Source: Business and financial news - CNNMoney.com | 28 May 2009 | 11:42 am London Markets: Man Group's slide helps lead London lower A slide in Man Group shares sparked by disappointment over the hedge-fund operator's financial results contributes to London trading lower. Source: MarketWatch.com - Top Stories | 28 May 2009 | 11:42 am Interface Announces Proposed Offering of Senior Secured Notes ATLANTA, May 28 /PRNewswire-FirstCall/ -- Interface, Inc. (Nasdaq: IFSIA) (the "Company"), the world's largest manufacturer of modular carpet, today announced that Source: RSS feed - channel BNewsBusiness | 28 May 2009 | 11:36 am Top Analyst Upgrades & Downgrades (ADSK, AVY, CAT, DFS, FEIC, BEN, JWN, PMTC, SLB, VECO) These are some of the top pre-market analyst calls with upgrades and downgrades from Wall Street firms this Thursday morning with more than two hours until the market opens: AutoDesk  (ADSK) Started as Neutral at Janney Montgomery Scott. Avery Dennison (AVY) Started as Underperform at Baird. Caterpillar (CAT) Cut to Sell at UBS. Discover Financial (DFS) Started as Outperform [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 28 May 2009 | 11:35 am Currencies: Dollar mostly higher ahead of new-home sales data The U.S. dollar was higher versus most rivals Thursday as markets awaited further data on the U.S. housing market and weighed the impact of the recent rise in government-bond yields. Source: MarketWatch.com - Top Stories | 28 May 2009 | 11:34 am Ex-Kmart CEO back on witness stand in civil trial (AP) AP - The former head of the Kmart retail chain is returning to the witness stand for questions from a government lawyer as his trial on civil fraud charges moves closer to a conclusion. Source: Yahoo! News: Stock Markets News | 28 May 2009 | 11:27 am A new iTunes player that's not from Apple It came up briefly at Comdex in January when a Palm representative let the cat out of the bag. Nobody followed up. Source: Business and financial news - CNNMoney.com | 28 May 2009 | 11:24 am Opec leaves output unchanged The oil producers' cartel left production levels unchanged, betting that higher oil demand as the global economy recovers will push prices towards its $75-$80 target by the end of the year Source: Financial Times - US homepage | 28 May 2009 | 11:23 am Target, Ackman battle comes to vote in Wisconsin Waukesha, Wisconsin (Reuters) - One of the season's highest-profile proxy battles is being put to a vote on Thursday as activist investor William Ackman and Target Corp face off at the retailer's annual meeting. Source: Reuters: Business News | 28 May 2009 | 11:19 am Opel race narrows to two but still no funding deal (Reuters) Reuters - As the battle for German carmaker Opel effectively narrowed to a race between Fiat and Magna, overnight talks to shield Opel from General Motors' looming bankruptcy ended with no deal. Source: Yahoo! News: Business | 28 May 2009 | 11:14 am UK High Street sales fall in May UK retail sales fell more than expected in May after a brief rise in April, a survey by the CBI has shown. Source: BBC News | Business | World Edition | 28 May 2009 | 11:13 am Stocks set for slight advance U.S. stocks were set to open slightly higher Thursday, as investors worried kept about rising bond yields and awaited a wave of economic reports. Source: Business and financial news - CNNMoney.com | 28 May 2009 | 11:11 am Opec keeps output target on hold The price of oil falls back from Wednesday's six-month highs as producers' cartel Opec decides to keep output levels unchanged. Source: BBC News | Business | World Edition | 28 May 2009 | 11:11 am Toys 'R' Us buying FAO Schwarz Toys "R" Us has acquired upscale rival FAO Schwarz, the oldest toy retailer in the United States, the company said Thursday. Source: Business and financial news - CNNMoney.com | 28 May 2009 | 10:56 am Car downturn claims Visteon as new victim Visteon, the American car parts supplier once owned by Ford, has filed for Chapter 11 bankruptcy protection for its US operations. Source: Latest Business News from Times Online | 28 May 2009 | 10:56 am Peter Brimelow: Dines rebounds but retreats on bullishness Jim Dines's reinvention of himself is ramifying -- but he also seems more cautious in the short term. Source: MarketWatch.com - Top Stories | 28 May 2009 | 10:53 am OPEC leaves oil-output quota unchanged Oil ministers from the 13-nation Organization of Petroleum Exporting Countries leave production quotas unchanged at today's meeting in Vienna. Source: MarketWatch.com - Top Stories | 28 May 2009 | 10:52 am Costco net falls on weak discretionary spending (Reuters) - Costco Wholesale Corp on Thursday said its third-quarter net profit fell 29 percent, as shoppers stuck to buying basics like food and medicine, and pared back discretionary purchases of clothes or jewelry. Source: Reuters: Business News | 28 May 2009 | 10:51 am Citi, Bank of America May Raise Salaries Looks like that bailout money is being put to use (from CNBC): Following a Morgan Stanley plan unveiled last week, Citigroup and Bank of America are likely to soon raise base salaries for investment bankers to compensate for limits on annual bonuses, the Wall Street Journal said, citing people familiar with the matter. Goldman Sachs and JPMorgan Chase are not considering an increase in base pay, the paper added, citing two people familiar with the matter. BofA spokeswoman Jessica Oppenheim was quoted as telling the paper that “pressures in the investment-banking and capital-markets businesses continue to be intense,” adding that the bank would “take the steps necessary to retain key employees.” Source: Business Pundit | 28 May 2009 | 10:48 am European stocks follow US down on debt concerns (AP) AP - European stock markets fell Thursday following big losses on Wall Street as investors worried that a rise in U.S. bond yields could derail any nascent global economic recovery. Source: Yahoo! News: Stock Markets News | 28 May 2009 | 10:45 am Two U.S. auto parts makers file for Chapter 11 BANGALORE (Reuters) - Auto parts makers Visteon Corp and Metaldyne Corp filed for Chapter 11 bankruptcy protection for their U.S. operations, becoming the latest casualties of the global auto industry crisis. Source: Reuters: Business News | 28 May 2009 | 10:36 am Two U.S. auto parts makers file for Chapter 11 (Reuters) Reuters - Auto parts makers Visteon Corp and Metaldyne Corp filed for Chapter 11 bankruptcy protection for their U.S. operations, becoming the latest casualties of the global auto industry crisis. Source: Yahoo! News: Business | 28 May 2009 | 10:36 am Pound falls back against dollar Sterling falls against the dollar after the US currency rallies in early trade and a UK policymaker warns of "false dawns". Source: BBC News | Business | World Edition | 28 May 2009 | 10:30 am Server Sales, A Proxy For IT Spending, Take A Hit (HPQ)(IBM)(DELL)(INTC)(AMD) A drop in server sales is bad news for companies that build them including HP (HPQ), IBM (IBM), and Dell (DELL) and the firms that supply chips–AMD (AMD) and Intel (INTC). But, it is also grim news for the entire IT industry. According to The Wall Street Journal, server sales in the first quarter were abysmal. “Worldwide [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 28 May 2009 | 10:29 am Global crisis 'hits human rights' The global economic crisis is greatly exacerbating abuses of human rights, Amnesty International warns. Source: BBC News | Business | World Edition | 28 May 2009 | 10:26 am Wolseley profits hit share price Buildings material group Wolseley's shares tumble 15% after the company issues a downbeat trading statement. Source: BBC News | Business | World Edition | 28 May 2009 | 10:25 am Buytolet: rental market 'may have bottomed out' The rental market showed signs of stabilising in May with average rents remaining unchanged for the first time in nine months research has showed. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 28 May 2009 | 10:12 am As Parts Company Visteon Goes Bankrupt, Car Industry Faces Another Challenge Car parts maker Visteon is is going into Chapter 11 and if a number of its peers follow it, there is a chance that the supply of components to US car companies could be interrupted. That would make GM’s (GM) life more difficult as it attempts to go through the Chapter 11 process itself. In a [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 28 May 2009 | 10:06 am Opec ministers agree to keep oil output steady Opec ministers confirmed today that they will maintain oil production numbers at previously set targets as they expect a strengthened global economy to boost the price fo crude. Source: Latest Business News from Times Online | 28 May 2009 | 10:03 am Google (GOOG) Deal Will Hurt News Corp (NWS) Earnings Google (GOOG) has a three-year deal to sell search advertising on News Corp’s (NWS) huge social network MySpace. The arrangement will soon be up for renewal. Google did not get a return on its $900 million revenue guarantee and there are rumors that it wants to cut its obligation from $300 million a year to [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 28 May 2009 | 9:55 am How to not screw up your taxes My name is Rachel Kaufman, and I don't understand taxes. Source: Business and financial news - CNNMoney.com | 28 May 2009 | 9:49 am U.S. court seen clearing Chrysler sale to Fiat NEW YORK (Reuters) - Chrysler looks set to clear its last major hurdle in its sprint through bankruptcy court as soon as Thursday, when a judge is expected to overrule more than 340 objections and approve its sale to a group that includes Fiat. Source: Reuters: Business News | 28 May 2009 | 9:48 am Federal Reserve To Undercut Bank Stress Tests Now that the bank stress tests are over the firms that were examined and found to need more capital have been able to go about the business of raising it. Part of their projections of how much money they will require is calculated based on each bank’s projections of its future earnings. The Federal Reserve thinks that the [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 28 May 2009 | 9:45 am One Bank Regulator For One Mess The federal government is considering having one regulator to oversee the entire banking system. The mess in the industry is so great that the idea of consolidating the power to control the sector may be a good idea, but the bureaucracy behind the move is likely to be immense. Merging federal agencies is not likely to [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 28 May 2009 | 9:31 am The next real estate bust? Bailout watchdogs have something new to growl about: the lack of financing in the commercial real estate markets. Source: Business and financial news - CNNMoney.com | 28 May 2009 | 9:30 am US gloom weighs on London Britain's leading share index stayed in negative territory in mid-morning trading after failing to shake off concern about rising US debt and growing fears that General Motors will file for bankruptcy protection by Monday. Source: Latest Business News from Times Online | 28 May 2009 | 9:24 am The United States Debt: Safer Than Fort Knox No one should have to tell the US government that it has the highest possible credit rating. It is the government of the world’s largest economy, the world’s most voracious consumers, and its debt, the world’s investment of last resort. Shudders went though the global markets a week ago when S&P took its outlook on UK [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 28 May 2009 | 9:18 am Another Hundred Years Of A World Fueled By Oil The head of Exxon Mobil (XOM), which from time to time is the most profitable and most valuable company in the world, told people attending the firm’s annual meeting that oil and gas will be the most widely used fuels for another hundred years. According to Bloomberg, Exxon CEO Rex Tillerson said “Petroleum-based fuels including [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 28 May 2009 | 9:12 am Costco net falls on weak discretionary spending (Reuters) Reuters - Costco Wholesale Corp on Thursday said its third-quarter net profit fell 29 percent, as shoppers stuck to buying basics like food and medicine, and pared back discretionary purchases of clothes or jewelry. Source: Yahoo! News: Business | 28 May 2009 | 9:05 am Visteon enters bankruptcy in US US car parts maker Visteon seeks bankruptcy protection, but says the filing does not include overseas subsidiaries. Source: BBC News | Business | World Edition | 28 May 2009 | 9:02 am Are U.S. bonds really a safe haven? Source: Business and financial news - CNNMoney.com | 28 May 2009 | 9:01 am Man Group shares plunge 11% on fees slump Shares in Man Group today plunged by 11.3 per cent after the world's biggest listed hedge fund manager warned shareholders that it would gather in lower management fees this year as institutional clients continued to defect. Source: Latest Business News from Times Online | 28 May 2009 | 8:56 am FSA defends decision not to release 'stresstest' results on individual banks Regulator defends decision not to follow the US and publish details of how individual banks have performed under tests that model the worst recession since 1945. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 28 May 2009 | 8:55 am Hedge fund Pequot closing as probe back in spotlight NEW YORK (Reuters) - Prominent hedge fund firm Pequot Capital told investors on Wednesday it will shut down because of a reopened government probe into possible insider trading. Source: Reuters: Business News | 28 May 2009 | 8:49 am FSA reveals doomsday scenario to stress-test banks Financial regulators revealed today that they were testing how British banks would cope if unemployment hit 3.7 million, house prices halved and the recession lasted another one and a half years. Source: Latest Business News from Times Online | 28 May 2009 | 8:40 am Fixing health care: What it'll cost you If President Obama has his way, health care reform will be finalized this year. Key Senate and House committees are planning to mark up legislation in June, and the House is aiming to vote on the issue by August. Source: Business and financial news - CNNMoney.com | 28 May 2009 | 8:34 am West Brom hits back at savings account criticism West Bromwich Building Society is considering suing Which? over the consumer group's accusation that it "irresponsibly" encouraged people to invest more in one of its products than is covered by the savers' compensation scheme. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 28 May 2009 | 8:30 am GM bankruptcy: Double-edged sword A bankruptcy filing for General Motors could come in the next few days, now that GM bondholders have rejected a proposed swap of $27 billion in unsecured company debt for 10% of GM's stock. Source: Business and financial news - CNNMoney.com | 28 May 2009 | 8:21 am How we saved £1200 on household bills - part 1 On a mission to reduce her utility bills Kara Gammell has given her house the onceover. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 28 May 2009 | 8:19 am How we saved £1200 on household bills - part 2 On a mission to reduce her utility bills Kara Gammell has given her house the onceover. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 28 May 2009 | 8:19 am Gordon Brown urges focus on repairing world trade Gordon Brown warned today there was no chance of an economic recovery unless a revival in world trade took place. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 28 May 2009 | 8:07 am Media Digest 5/28/2009 Reuters, WSJ, NYTimes, FT, Bloomberg Reuters:   Central bankers in the US and Europe are battling deflation and inflation simultaneously. Reuters:   GM (GM) is close to bankruptcy but the fate of Opel is still open. Reuters:   Citigroup (C) and the SEC are working on settling charges on an asset disclosure problem. Reuters:   A US plan to buy bad bank assets is in trouble. Reuters:   Despite [...] [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 28 May 2009 | 7:58 am Man shares slide as assets under management fall further Hedge fund manager admits that assets under management have continued to slide. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 28 May 2009 | 7:43 am Vauxhall and Opel rescue in chaos over GM demand for extra state aid Talks to secure thousands of jobs in Vauxhall and Opel have broken down in acrimony after the German Government accused the US parent company, General Motors (GM), of "scandalous" behaviour by requesting extra state aid. Source: Latest Business News from Times Online | 28 May 2009 | 7:39 am Australian stocks: Market closes maore than 1pc lower MELBOURNE - The Australian share market closed more than one per cent lower amid broad-based selling following a poor lead from Wall Street. The benchmark S&P/ASX200 index was 45.4 points, or 1.19 per cent lower at 3755.7, while... Source: New Zealand Herald - Business | 28 May 2009 | 7:31 am Asia Markets And Europe Open 5/28/2009 Markets in Asia were mostly higher with China closed. The Nikkei rose .1% to 8,451. At the open in Europe, the FTSE was down .7%. The Dax was off 1.2% to 4,940 and the CAC 40 dropped 1.5% to 3,245. Data from MarketWatch and Reuters. Douglas A. McIntyre Posted in International Markets [[ This is a content summary only. Visit my website for full links, other content, and more! ]] Source: 24/7 Wall Street | 28 May 2009 | 7:25 am A brief history of General Motors Corp. Some key events in General Motors' history: Source: RSS feed - channel BNPaperBusiness | 28 May 2009 | 7:00 am GM might leave an opening on the Dow Which company would replace the automaker? Speculation includes Apple, Abbott Labs and Goldman Sachs. Now that... Source: RSS feed - channel BNPaperBusiness | 28 May 2009 | 7:00 am Stocks trade mixed as GM gets closer to bankruptcy NEW YORK -- Wall Street's rally is going back on hold as General Motors takes another step toward bankruptcy court. Source: RSS feed - channel BNPaperBusiness | 28 May 2009 | 7:00 am California's problem is spending? That's a myth A reader writes: Source: L.A. Times - Business | 28 May 2009 | 7:00 am Contest teaches teens about economy, stock market A Goleta student turns a fictional $100,000 into $1.5 million, then loses most of it. A Bakersfield team tackles the economy and wins first place. The Capital Markets Contest is a forum for growth. ... Source: RSS feed - channel BNPaperBusiness | 28 May 2009 | 7:00 am Land Rover maker ordered to pay $21.1 million in rollover case A Los Angeles judge blames the design of the Land Rover Discovery SUV in the 2003 accident in which a Simi Valley man was paralyzed. The company plans to appeal. ... Source: RSS feed - channel BNPaperBusiness | 28 May 2009 | 7:00 am Banks may get a single regulatory agency Obama administration officials are working to replace a patchwork system of regulators with one agency, sources say. Senior administration officials are considering the creation of a single agency to regulate the banking industry, replacing a patchwork of agencies that failed to prevent banks from falling into the worst financial crisis since the Great Depression, according to three people familiar with the matter. Source: L.A. Times - Business | 28 May 2009 | 7:00 am LAX aims to put shopping, eating on more flight plans Officials hope to lift the airport's image of having mediocre offerings. Plans call for renovating the bars, fast-food outlets, restaurants, newsstands and retail shops inside eight terminals. ... Source: RSS feed - channel BNPaperBusiness | 28 May 2009 | 7:00 am Contest teaches teens about economy, stock market A Goleta student turns a fictional $100,000 into $1.5 million, then loses most of it. A Bakersfield team tackles the economy and wins first place. The Capital Markets Contest is a forum for growth. Charles Clow has some advice for the Obama administration on how to get the U.S. out of the recession. Source: L.A. Times - Business | 28 May 2009 | 7:00 am Attack on Starbucks is a new-media blend Critics use a website and social media to portray the coffee giant as anti-union. The company denies being a bad employer. ... Source: RSS feed - channel BNPaperBusiness | 28 May 2009 | 7:00 am A brief history of General Motors Corp. Some key events in General Motors' history: Source: L.A. Times - Business | 28 May 2009 | 7:00 am Hollywood Park racetrack faces bleak odds of survival Its owner plans to redevelop the 238-acre property in Inglewood into a retail and residential complex in about a year if the City Council approves the project. A proposed $2-billion real estate development that would replace the historic Hollywood Park racetrack and change the face of Inglewood may get the go-ahead tonight from the City Council. Source: L.A. Times - Business | 28 May 2009 | 7:00 am LAX aims to put shopping, eating on more flight plans Officials hope to lift the airport's image of having mediocre offerings. Plans call for renovating the bars, fast-food outlets, restaurants, newsstands and retail shops inside eight terminals. When Clifton Moore ran the Los Angeles airport system from 1968 to 1993, there wasn't much emphasis on dining and shopping for people waiting for their planes at LAX. About all they could get were the basics: a newspaper, a cup of coffee, cafeteria fare and a preflight libation. Source: L.A. Times - Business | 28 May 2009 | 7:00 am California's problem is spending? That's a myth A reader writes: Source: RSS feed - channel BNPaperBusiness | 28 May 2009 | 7:00 am GM bankruptcy becomes nearly certain as offer to bondholders fails The automaker voids the tender offer after a majority of its bondholders refuse to swap their debt for equity. The company now appears likely to file for Chapter 11 by Monday. General Motors Corp.'s last-ditch, Hail Mary bid to avoid bankruptcy fell with a thud Wednesday as its bondholders overwhelmingly rejected a deal to swap their debt for equity in the company. Source: L.A. Times - Business | 28 May 2009 | 7:00 am Banks may get a single regulatory agency Obama administration officials are working to replace a patchwork system of regulators with one agency, sources say. ... Source: RSS feed - channel BNPaperBusiness | 28 May 2009 | 7:00 am Union backers target Starbucks with new-media campaign Critics use a website and social media to portray the coffee giant as anti-union. The company denies being a bad employer. Starbucks a hub of union-busting and worker exploitation? Source: L.A. Times - Business | 28 May 2009 | 7:00 am Hollywood Park racetrack faces bleak odds of survival Its owner plans to redevelop the 238-acre property in Inglewood into a retail and residential complex in about a year if the City Council approves the project. ... Source: RSS feed - channel BNPaperBusiness | 28 May 2009 | 7:00 am Baby boomers face tough decision on taxfree cash Savers who have celebrated their 50th birthday - or will do so soon - have an important decision to make. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 28 May 2009 | 6:56 am Share tips: buy Prudential sell Wolseley Stockbrokers give their views on whether you should buy sell or hold a selection of shares. Source: Finance and Business. Latest breaking news stocks and shares from the UK and world | 28 May 2009 | 6:54 am Budget 09: Goff slams 'dishonest Budget' Labour Party leader Phil Goff has launched a fierce attack on the Government Budget, calling it a "dishonest budget" with no plan to protect jobs, no substance and no vision in it. "This is a dishonest budget," Mr Goff said. "Tax... Source: New Zealand Herald - Business | 28 May 2009 | 6:50 am Visteon files for bankruptcy protection Visteon, the former parts arm of Ford Motor, filed for Chapter 11 bankruptcy protection in the US in one of the biggest failures yet of an automotive supplier Source: Financial Times - US homepage | 28 May 2009 | 6:19 am Asia markets muted as data, GM fate dim recovery (AP) AP - Asian markets were mixed Thursday as sliding retail sales in Japan and the looming bankruptcy of auto giant General Motors undercut optimism about a global recovery. Source: Yahoo! News: Stock Markets News | 28 May 2009 | 6:11 am NZ stocks: Market falls nearly 2pc Fisher and Paykel Appliances shares stood out against a falling New Zealand stockmarket, as the Government announced a conservative budget and Wall Street dropped. Following US markets overnight, the NZSX-50 fell from opening,... Source: New Zealand Herald - Business | 28 May 2009 | 6:09 am Currency: Dollar climbs on S&P outlook upgrade The New Zealand dollar rose on news that credit rating agency Standard & Poor's has upgraded the outlook on New Zealand's credit rating to stable from negative. Prior to that move the NZ dollar had drifted lower from around US61.50c... Source: New Zealand Herald - Business | 28 May 2009 | 5:35 am Target, Ackman battle comes to vote in Wisconsin (Reuters) Reuters - One of the season's highest-profile proxy battles is being put to a vote on Thursday as activist investor William Ackman and Target Corp face off at the retailer's annual meeting. Source: Yahoo! News: Business | 28 May 2009 | 5:14 am Best Buy to launch internet fund The largest US consumer electronics retailer is launching an investment fund managed by former and current News Corp internet veterans that will focus on digital media Source: Financial Times - US homepage | 28 May 2009 | 5:01 am Citi, SEC in talks to settle asset disclosure probe: report (Reuters) Reuters - Citigroup Inc is in early negotiations with the U.S. Securities and Exchange Commission (SEC) to settle a probe into whether it misled investors by not properly disclosing the amount of troubled mortgage assets it held as the markets started to fall in 2007, the Wall Street Journal said, citing people familiar with the matter. Source: Yahoo! News: Stock Markets News | 28 May 2009 | 4:56 am Citi, SEC in talks to settle asset disclosure probe: report (Reuters) Reuters - Citigroup Inc is in early negotiations with the U.S. Securities and Exchange Commission (SEC) to settle a probe into whether it misled investors by not properly disclosing the amount of troubled mortgage assets it held as the markets started to fall in 2007, the Wall Street Journal said, citing people familiar with the matter. Source: Yahoo! News: Business | 28 May 2009 | 4:56 am Fortress to take first step into retail banking The private equity and hedge fund company is nearing an agreement where it will inject $800m in fresh capital into First Southern, a Florida bank that has less than $400m in assets Source: Financial Times - US homepage | 28 May 2009 | 4:01 am Ackman's Target Campaign Is Off the Mark TARGET, ONE OF THE NATION'S MOST SUCCESSFUL RETAILERS, is under attack by an activist investor who has lost his shirt, and his clients', in a hedge fund that bet the wrong way on the direction of the company's shares. Bill Ackman, head of Pershing Square Capital Management, launched the unusual single-stock fund, Pershing Square IV, in 2007, investing $2 billion only in Target call options and other derivatives. The fund lost 90% of that money as Target's shares plummeted 50%, to 31 earlier this year. The fund has recovered somewhat since then, as the shares have rebounded to 41, but it remains down about 80% since inception. Another hedge-fund hotshot gone cold might concede defeat in such circumstances. But Ackman, who manages $4.5 billion, and whose other, diversified funds have produced impressive annualized returns of more than 20% in the past 5½ years, is ramping up the pressure on Minneapolis-based Target (TGT) -- as if a brutal economy hasn't exerted enough. Pershing Square, which owns 24.8 million Target shares, as well as options on 20 million shares, has mounted a proxy fight to get any of Ackman's five candidates -- himself included -- onto the Target board, replacing incumbents favored by management. Results of the shareholder vote should be released around the time of Target's annual meeting on Thursday. The battle between Ackman and Target boils down to whether a sizable but not dominant institutional share-holder -- he owns about 3% of the stock -- is entitled to board representation, and whether a well-managed company ought to be free from the input and potential interference of such a shareholder in the boardroom. Many on Wall Street think Ackman should leave Target alone and let management run the business without undue meddling. The betting is that Target will fend him off because of the company's strong standing in the investor community, not to mention Ackman's limited stake. "Institutional investors are loath to support a dissident in the absence of a strong showing of malfeasance on the part of the directors," says Greg Taxin, a principal at Spotlight Capital Management in New York. "There's very little to complain about at Target." Target is taking the Ackman challenge seriously; management has met with top holders and fired off a series of letters to shareholders. Chief Executive Gregg Steinhafel began the company's earnings conference call Wednesday with a 10-minute address about the proxy fight that included a defense of Target's slate, including Wells Fargo Chairman Richard Kovacevich. Steinhafel blasted the Pershing Square plan to separate Target's real-estate holdings as "risky" and "speculative." ACKMAN'S INITIATIVE COULD be one of the worst-conceived efforts in recent years by an activist investor, considering the dubious benefits his proposed strategy might produce. Target is the only major retailer that has thrived while going head to head with one of the world's most formidable companies: Wal-Mart Stores (WMT). "Ten years ago there was a host of regional discounters, and Target was the one that emerged successfully with much more limited resources than Wal-Mart. It is a remarkable achievement," says Michael Exstein, a retailing analyst at Credit Suisse. "Not all of America wants to shop at Wal-Mart, and Target is the best alternative out there." Among retailers, Target has the third-largest market value -- $31 billion -- behind Home Depot (HD) and Wal-Mart. Target stock has bested its retailing peers and the Standard & Poor's 500 index in the past decade, and the company's earnings have nearly doubled in the past five years. Its fiscal first-quarter profit of 69 cents a share, reported last week, topped expectations and was down a modest 7% from year-earlier levels. Revenue was up slightly to $14.4 billion, making it one of a handful of retail giants to post sales gains. Bulls like Exstein say the stock can hit $50 in the next year. Target now trades for about 14 times projected 2009 profits of nearly $3 a share. Target has succeeded with a mix of staples and style that has attracted a more affluent customer base than Wal-Mart, particularly young women who come to the stores for low-margin toothpaste and diapers, as well as higher-margin clothing and housewares. Female shoppers account for an estimated 75% of Target customers. Target is following a financial program that worked well for Wal-Mart in 2008, when the Bentonville, Ark., behemoth was one of only two stocks in the Dow Jones Industrial Average that registered a positive return (the other was McDonald's ). Target has scaled back new-store openings and capital expenditures, which could produce more than $2.5 billion of free cash flow this year, and even more in 2010, compared with negative free cash of about $800 million in 2008. The added funds could allow the company to cut debt, resume its share-repurchase program or increase its dividend, which yields a modest 1.5%. The Ackman initiative is tamer than most activist campaigns that flag underperforming companies and urge significant corporate actions, such as major divestitures or outright sales of the company. Activist investor Carl Icahn generally has sought major changes when he has tangled with companies such as Motorola (MOT), Time Warner (TWX) and Yahoo! (YHOO). Ackman has no beef with Target management. "What we have here is not a management problem, but a board problem," he said Thursday. His view is that the Target board is too "cozy" and "insular" and lacks members with requisite retailing, credit-card and real-estate backgrounds. In a letter to shareholders, Ackman said the company "has substantially underperformed its potential" due in part to the board's failure to sell Target's credit-card operations, and that it should consider moves to "unlock real-estate" value. He has said Target's real-estate portfolio, mostly land and stores, could be valued at $40 billion, or nearly as much as the company's enterprise value (equity-market value plus net debt). Target has about $12 billion of debt outside its credit-card operations. Two real-estate analysts contacted by Barron's question how much value could be created via an Ackman real-estate proposal made last year that involves placing the land under Target's stores into a real-estate investment trust and leasing back the land from the REIT. This would cost the company about $1.4 billion in annual rent. Ackman's premise is that the lease payments, roughly 20% to 25% of Target's annual cash flow, would garner a higher valuation inside a REIT structure, and that the Target REIT and new Target without real estate would be worth more than the current Target. Mike Kirby, head of research at Green Street Advisors, a California real-estate specialist, says "there's a bit of financial alchemy attached" to the plan. "Ackman may have a point, but usually these proposals have a 'too good to be true' element." Kirby says, "For a REIT to get a high valuation, it needs to have a secure cash-flow stream, and for Target, excluding its real estate, to have a high valuation, investors have to feel secure about its creditworthiness." Kirby says single-tenant REITs like the one envisioned by Ackman aren't too popular with investors, who like a diversified tenant base. "It definitely isn't something that people get excited about," he says. "Transferring all of this real estate would constrain Target's flexibility to make renovations, expansions and enhancements that are part of the ongoing evolution of any retailer," wrote Richard Sokolov, president of Simon Property Group, the biggest U.S. mall operator, in a recent letter supporting Target. "Most of the retailers we deal with would be very pleased to own all of their real estate and have the financial strength and flexibility that Target has today." It is tough enough competing with Wal-Mart with a great balance sheet, let alone with a weakened one. Besides, valuations in the REIT sector are depressed. Target trades for about eight times projected 2009 pretax cash flow, while a Target REIT might not command much more than 10 times cash flow. ACKMAN ALSO CRITICIZED Target for not selling its credit-card operations, which have about $8 billion in receivables. Most major retailers have gotten out of the card business. Target sold a 47% stake to JPMorgan Chase (JPM) in 2008, but retained significant credit risk from the portfolio. The company took a sizable charge in the fourth quarter to build reserves, and its losses on the portfolio hit 16% in April, although it is still profitable. Ackman has some legitimate beefs with Target, including low equity ownership by the board. Two board members own no stock beside stock option and equity grants. Target's sales performance has trailed that of Wal-Mart in the past year, although that has come after several years when Target bested its larger rival. While there may be merit in some of Ackman's arguments, Target remains one of the best-run retailers in the country. His proxy fight seems to have a lot to do with ego and has been a major distraction for management at an otherwise challenging time. Indeed, it seems time to buy Target shares, not Ackman's campaign. The Bottom Line One of the most successful retailers in America, Target is a buy at 41. Ackman's plan to unlock the company's real-estate value may be a sell. SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved. Source: SmartMoney.com | 28 May 2009 | 4:00 am Is Oil Spent or About to Geyser? (Screens) In today’s dollars, a barrel of crude oil collected from America’s seeps in 1859 cost more than $350. It was something of a bargain. Whale oil had shot up to more than $1,000 a barrel, and crude was proving better for lamps, once distilled to kerosene using a process touted by Yale professor Benjamin Silliman. In August of that year Edward Drake drilled 69 feet below Titusville, Pa., to find “rock oil” far more abundant than the seeps. A drilling rush ignited, and just two years later crude had crashed to $12 a barrel. That was the first of three great dramas for oil’s price in America. The second came more than a century later, when a cartel of Arab oil exporters declared a U.S. embargo (1973), and Iran’s Shah was ousted by Islamic revolutionaries (1979), and crude jumped sevenfold. The third, in which crude rose from less than $20 a barrel in early 2002 to $147 last summer, happened for less-clear reasons, which makes its recent aftershock — prices are up 80% since February — all the more worrisome. Are we headed for oil drama No. 4 (or if you like, a continuation of No. 3, after it was briefly interrupted by global recession), or is oil just throwing a final fit before it settles back to $30? As with any good, that depends on supply and demand. For oil, the two are difficult to judge. Demand depends on global economic growth, and the extent to which the spread of oil-saving technology, like electric cars, offsets that of oil-consuming technology, like $2,500 gasoline cars in India. This year, the world is expected to use 3% less oil than last year, but such declines are rare. “Supply” refers not just to how much crude we’ve sucked up and set aside (rich countries are storing almost 20% more than average), or to how much is still in the ground, but also to how costly remaining deposits are to exploit. Pools located far below Arctic ice would cost far more to get at than those just below Saudi desert. Oil mixed with sandy muck costs more to process than light sweet. Reservoirs governed by fickle populists carry added risk, and thus added expense. Call on experts if you like, but good luck choosing among them. We’re at $63 a barrel now. Veteran oilman T. Boone Pickens sees $75 this year and $200 within five years. Saudi Arabia’s state oil company sees a “vicious” spike brought by low investment. The U.S. Energy Information Administration expects prices to drop $5 or so. The New York Mercantile Exchange reports a sharp increase in options bets on a fall below $50 a barrel by July. This last indicator can’t quite be called bearish. For every trader buying such a bet, there must be one selling it. But it might mean that oil is poised for a big move by August, just in time for the 150th anniversary of that first Titusville find. Wall Street’s energy analysts seem to expect heaps of excitement ending in big profits. They expect earnings for energy companies in the S&P 500 index to plunge 67% this year but soar 88% next year — a wild ride. If they’re right, big oil producers, whose shares have lost 25% in a year but still look expensive next to meek earnings forecasts, are in fact cheap compared with next year’s results. I’m never keen on relying on analyst forecasts. Two things make this one easier to accept. First, oil companies pay generous dividends, which will console shareholders if the gains don’t materialize. Second, oil is priced in dollars, making oil producers at once a hedge against a run-up in real crude prices and a hedge against a frittering away of the currency’s value. Below find five major oil stocks and their dividend yields. Note the gap between this year’s price/earnings ratios and next year’s.
Company	Ticker	Share Price	Market Value ($bil.)	Forward P/E (Current Yr.)	Forward P/E (Next Yr.)	Yield (%)
Data as of May 27, 2009 Source: Reuters
Exxon Mobil	XOM	$68.30	333.3	16.9	11.5	2.5
BP PLC ADR	BP	48.08	150.1	13.3	8.7	7.0
Total SA	TOT	55.10	122.8	11.1	8.6	4.8
Chevron	CVX	64.57	129.4	14.7	8.9	4.0
ConocoPhillips	COP	44.47	65.9	14.3	7.4	4.2

SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved.

How to Pick the Right Fund Firm

Investors may be fed up with the performance of their individual funds, but shares in the fund companies themselves have been doing exceedingly well lately, thank you very much.

In fact, these companies’ stocks rose three times as much as the broader market during the much-heralded bounce this spring. These money-management firms—which include brokerage firms like Charles Schwab (SCHW), institutional managers like BlackRock and mutual fund families like Janus—get a double boost when the market rises. The amount of money they manage increases, of course, and so does their fee revenue, since fees are generally a percentage of assets. Plus, good performance—even if it’s due to an overall run-up—tends to attract more assets, leading to even more fee revenue. Of course, the reverse can happen in a down market. The average asset-management firm lost 23 percent of its assets in the 14 months from just after the market’s peak in October 2007 through Dec. 31, 2008, according to fund-tracking company Lipper.

All of this can easily leave investors with whiplash. Just weeks before the spring rally, many asset managers were trading like they were going out of business, says Rob Lee, managing director of equity research for Keefe, Bruyette & Woods. Now many analysts say they’re overvalued. “These are volatile stocks to begin with, but in my 18 years of doing this, I’ve never seen it like this,” Lee says.

Unusual times call for unusual measures. Sure, it’s tempting to look solely at how a firm’s products are performing, but analysts advise looking at today’s bigger trends. BlackRock, which had $1.3 trillion in assets under management at the end of 2008, for instance, could benefit from the government’s plan to buy devalued mortgages from some banks. The government is looking for private investors to partner in this endeavor, and BlackRock has been short-listed as one of the potential buyers.

Another big trend: cash. Money-market assets are up $245 billion, or 6.5 percent, in the past year. These funds tend to have very low fees, but Federated Investors, which has $409 billion in assets, offers a wide array of money-market funds and has the scale to make the business profitable. What’s more, when investors move their cash into the market, they tend to keep their money within the same fund family, says Peter Crane, president of money-market research firm Crane Data. So Federated could gain even more if customers opt for its higher-fee stock or bond funds.

Charles Schwab is poised to capture much of the money that’s in motion this year as burned-out investors seek better options, says Jeffrey Hopson, equity analyst with Stifel Nicolaus. Indeed, Schwab attracted $25 billion in net new assets in the first quarter, as some customers moved their business away from full-service brokers.

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Major Indexes Set to Bounce After Selloff (Market Update)

News at a Glance

• Obama on Economy: "We have stepped back from the brink."
• Rebound Signaled: Stocks look to open higher.
• Thanks, But...: Bad-debt buyout plan dismissed: WSJ.
• Playing Nice: Toys"R"Us buys rival FAO Schwarz.

The Lowdown

Bargain-hunters are set to give the market an early bounce after yesterday's selloff.

A day after a late swoon left the major indexes in a deep hole, stocks were set to open higher Thursday, as traders eyed discounts. Shortly before 7:30 a.m., Dow, Nasdaq and S&P 500 futures were trading above fair value.

Whether stocks close higher may have more to do with the day's economic data than Wednesday's steep decline. Traders will get updates on the manufacturing, housing and labor sectors later this morning. The April reports on durable goods orders and new home sales are due out later today. The weekly jobless claims report is also on its way.

The housing report comes at a time of uncertainty for the sector. Earlier data had suggested the market may have reached a bottom, but recent reports, including a disappointing reading of the Case-Shiller Home Price Index earlier this week, suggest otherwise.

In finance, the U.S. plan to take bad debts off the hands of the nation's banks is drawing less interest than expected, The Wall Street Journal reported, citing anonymous sources. The Legacy Loan Program, part of a billion-dollar initiative to get the government and the private sector to shoulder the nation's poor invesetments, has put off several firms, some of whom say it hinges too much on the political environment in Washington.

Meanwhile, the White House offered broad praise for the state of the economy. "When you look at the economy right now, I think it's safe to say we have stepped back from the brink, that there is some calm that didn't exist before," President Obama said at a fund-raiser for the Democratic National Committee in Beverly Hills, Calif. (Not everyone agrees.)

World markets were mixed. Asia finished higher, as Japan's Nikkei climbed 0.1% and Hong Kong's Hang Seng jumped 5.3%. In Europe, the U.K.'s FTSE stood down 1.2% in midday trading.

In energy, crude prices were higher ahead of the release of last week's inventories data. By 7:21 a.m., oil traded up 38 cents at $63.83 a barrel.

Corporate News

• Citigroup (C) is in early talks to settle an investigation by the Securities and Exchange Commission into whether the bank misled shareholders by failing to disclose the extent of its holdings in mortgage-backed securities in 2007, The Wall Street Journal reported, citing anonymous sources. The discussions could mean a near-term resolution to the civil investigations brought against the bank about a year and a half ago.
• Costco (COST) reported a 28.4% drop in third-quarter net income, as consumers shied away from high-margin luxury goods and bought mostly food and household items in bulk, the warehouse retailer said. Costco earned $209.6 million, or 48 cents a share, down from $295.1 million, or 67 cents a share, in the year-ago period. Analysts had been looking for 53 cents a share.
• Toys"R"Us has acquired FAO Schwarz, the oldest toy retailer in the country, the firm said. Toys"R"Us Chairman and CEO Jerry Storch said the company would "work tirelessly to preserve the distinctiveness and integrity" of the FAO Schwarz brand, as well as its two retail locations in New York and Las Vegas.

The Economy

• The April report on durable goods orders, a measure of demand, is scheduled to be released at 8:30 a.m. by the Commerce Department. In March, orders slipped 0.8%. Economists expect an April rebound of 0.5%.
• The weekly jobless claims report for last week is scheduled to be released at 8:30 a.m. by the Labor Department. In the prior week, claims came in at 631,000. Economists predict the number people seeking unemployment benefits for the first time will have dipped slightly to 630,000.
• The April reading of the annual rate of new home sales is scheduled to be released at 10 a.m. by the Commerce Department. In March, the annual rate stood at 356,000 sales. For April, economists expect an increase to an annual rate of 363,000 sales.
• The crude inventories report for last week is scheduled to be released at 10:30 a.m. by the Energy Department. In the prior week, inventories remained above the upper limit of the average range for this point in the year.

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Trying to Cope When Jobless Benefits Run Out (Consumer Action)

One of the government's biggest moves to help individuals during the economic crisis has been the extension of unemployment benefits. But as the recession drags on, now even those extensions are running out for many -- bringing with it a whole new level of economic stress.

How are people coping when the unemployment checks dry up? For some it means hard choices, like dipping into their retirement savings, selling the family car or moving in with their parents.

Many people find that unemployment benefits aren’t even enough to pay the bills -- laid-off workers receive on average $295.05 a week, according to the Department of Labor -- but it definitely helps them get by.

Yet, as of April, almost half of all laid off workers collecting state unemployment insurance exhausted their benefits, the highest rate since records were first kept in 1948, according to National Employment Law Project (NELP). Furthermore, many job seekers are taking longer to find work. In April, unemployed people needed an average of 21 weeks to secure a job compared with fewer than 17 weeks in April 2006, according to the Bureau of Labor Statistics.

Fortunately, unemployment benefits last a while before running out. Up until mid-2008, benefits in most states ran up to 26 weeks. But thanks to a 13-week extension in July which became 20 weeks in November (as well as another 13 weeks for states with an unemployment rate of 6% or more for more than three months), those who get laid off can qualify for up to 59 weeks of benefits. Additionally, when President Barack Obama signed the stimulus plan in February, it enabled the federal government to pay for extended benefits of up to 20 more weeks, bringing the potential maximum of jobless benefits up to 79 weeks.

Read what Anastasia Pleasant and eight others
are enduring while looking for work.

Not everyone can qualify for the maximum amount, however. Each state has a formula that calculates how many weeks of benefits an unemployed worker is entitled to, based in part on the state’s unemployment rate and an individual’s work history and earnings, says Rick McHugh, staff attorney with NELP. And in many cases, working part time may disqualify a person from receiving benefits.

SmartMoney.com spoke with unemployed workers who have seen their benefits run out. Here's what they say they're doing to make ends meet:

MONET MERCER: Dilemma over the car.

Age: 30
Location: Dallas, Texas
Previous Job: Property manager for a commercial real estate company
Unemployed Since: November 2008
Jobless Benefits: Has one check left

When Mercer was laid off, she assumed unemployment benefits would keep her afloat until she found her next job. But then the Texas Workforce Commission informed her that she wouldn’t qualify for the maximum term of unemployment because she had moved to Texas (from Washington, D.C.) only 14 months prior. In total, she qualified for 27 weeks of benefits, with the last check coming at the beginning of June, she says. Mercer's parents have been paying her rent; she’s depleted her retirement account; and she’s been using the majority of her unemployment to pay for her car insurance and her bills. Mercer says that she needs to hold onto her car because of the long driving distances in Dallas and in order to do that she will step up her job search to include part-time work. Mercer has just one credit card -- but the issuer is sending her to collections for not paying the bill. “There isn’t anything left over to put into savings because there are times like now when I have $30 left until next week,” she says.

EDWIN DUTERTE: A move back to mom and dad.

Age: 39
Location: San Jose, Calif.
Previous Job: Construction lender with a bank
Unemployed Since: January 2008
Jobless Benefits: Expired three months ago

Duterte at his peak was overseeing construction deals of $5 million to $30 million, he says. Having worked up the ranks in the real estate world for some 20 years, previous stints included a position as construction lender at Wells Fargo (WFC) in 2007 and investment analyst of multifamily housing at Freddie Mac from 1999 to 2003. But in January 2008, as real estate was starting to slow, Duterte says his last employer laid off one-fifth of its staff. His unemployment benefits ended in February, forcing him to give up his rental apartment and move in with his parents. He’s been living off of his savings and his 401(k) and says he has $200 left in his bank account. To get back on his feet, Duterte says he networks on SlipSquad.com, a national pink slip party news site, and organizes his own pink slip parties in northern and southern California, where unemployed people meet to network and find jobs.

DONNA D’AMBROSIO: “I’m trying to stay positive.”

Age: 32
Location: Farmingdale, N.Y.
Previous Job: Statistical analyst at an advertising agency
Unemployed Since: July 2008
Jobless Benefits: Has two more checks left

SmartMoney first met D’Ambrosio at Monster.com’s (MWW) career fair in March where she was hoping to land her next job. Unfortunately, she's had little luck, she says, and as her unemployment comes to an end she’s applying anywhere that’s hiring, including a local bagel shop and retail stores at a nearby mall. This, however, isn’t D’Ambrosio's first encounter with unemployment. In August 2007 she says she was let go from a mortgage company, she says. In February 2008 D’Ambrosio gave up the apartment she rented and moved in with her parents. This prior experience with joblessness has been her saving grace, D’Ambrosio says. She spends only one-third of each unemployment check on her monthly car payments and gas and plans to give up the car when her lease ends in a month. D’Ambrosio says she’s also using a portion of her benefits to pay for a 30-credit business administration certificate program at Nassau Community College, which she feels will help her stand out at job interviews. “I think it’s also going to show that I haven’t just been sitting around all this time,” she says.

THOMAS GREGOIRE: Planning on couch surfing.

Age: 53
Location: Concord, Calif.
Previous Job: Commercial sales and leasing broker at a commercial real estate company
Unemployed Since: December 2008
Jobless Benefits: None

Gregoire says he was one of just three commercial brokers working in the company’s local office, but on New Year’s Eve the company laid him off along with one of his colleagues, he says. Because the company hired him in May 2008 as an independent contractor and paid him on commission, Gregoire doesn't qualify for unemployment benefits. He's exhausted his savings and 401(k) so at the end of May he plans to move out of his apartment and start couch surfing at friends’ homes until he can get back on his feet. Gregoire's car and vacation property have been repossessed by banks, he says, but Homeland Security hired him last month for short-term contract jobs at airports and ports. Gregoire says he’s also received certification to provide elder care, he says, and he took out a college loan to get a degree in health-care administration -- an industry he hopes to join soon.

ANASTASIA PLEASANT: "Something needs to happen soon."

Age: 47
Location: Monmouth County, N.J.
Previous Job: Photo editor at a custom publisher and marketing company
Unemployed Since: April 2008
Jobless Benefits: Expired two months ago

Pleasant says she was laid off in April 2008 -- along with more than half her colleagues. She filed for unemployment benefits immediately and found work as a freelancer to make ends meet. But in March she received her last unemployment check -- and she has only two freelance clients now. Her husband, 40, works as an estate manager, overseeing contractors on a private property. His salary covers their mortgage. To pay for their other expenses, the couple has been dipping into their savings account, although neither of them have yet to touch their IRAs. Should they find themselves in a financial situation where the mortgage can’t be paid, Pleasant says she’ll turn to her $75,000 home equity line of credit. (The bank hasn’t cut their credit line yet, she says.) In the meantime, Pleasant is trying to find work. She says she's been attending industry networking meetings and touching base with former colleagues, hoping to find her next steady job -- and steady paycheck.

NIKKI MAXWELL: From Whole Foods to the food bank.

Age: 40
Location: Los Angeles, Calif.
Previous Job: Grant writer at a charter school
Unemployed Since: September 2008
Jobless Benefits: None

Maxwell worked as an independent contractor for a local charter school for two and a half years, writing grants and helping it expand. But in September 2008 she says the school faced budget cuts and she was laid off. “Suddenly no one had the money to pay me to do what I do,” says Maxwell, adding that she didn't qualify for unemployment benefits an independent contractor. Nor was this the first time her family has come into hardship. Maxwell's husband Bill, 41, who is also an independent contractor writing scripts for videogames, couldn’t find work for about six months in 2008. “I certainly didn’t expect this in my stage of my life,” Maxwell says. “I had a very stable career. I was the one in my marriage with a regular job.” The couple has three children, ages 3, 7 and 9. To make ends meet they removed their youngest from day care; depleted their 401(k), which had about $10,000; and stopped shopping at Whole Foods (WFMI), opting for a local food bank instead. Maxwell says her father has been pitching in to help pay their rent, but the family doesn’t have health insurance -- and hardly any savings left.

GEORGE ANDERSON: “We wouldn’t have had a Christmas if it wasn’t for credit cards.”

Age: 48
Location: Redding, Conn.
Previous Job: Regional field manager at a retail book distributor
Unemployed Since: May 2008
Jobless Benefits: Expired two weeks ago

When his employer filed for bankruptcy in May 2008, Anderson says he was left jobless and without health insurance for himself and his family, he says. Anderson signed up his children, ages 3 and 11, for a state health insurance plan that costs $50 a month in premiums, but says he and his wife, 45, decided to forgo coverage because Cobra was too expensive. But after his wife was rushed to the hospital with pneumonia, Anderson says he signed them up with Americare, which offers free health-care coverage to low-income uninsured adults in Connecticut. To pay for the mortgage, Anderson says his wife found a job at a day-care center, which also offers free care for their three-year-old. He says they’ve depleted their savings and get some help from friends and family to cover everyday expenses. The Andersons got rid of their land line, opting to keep their two cellphones. They also canceled their private garbage service and now drive to the nearest dump. Anderson says they’ve been racking up credit-card debt, in part to replace their broken hot-water heater and to buy Christmas gifts for their children.

SHARI WILSON: Doing a bit of everything that’s legal.

Age: 39
Location: Hampton, Va.
Previous Job: Retail sales manager for Virginia-based newspaper
Unemployed Since: February 2008
Jobless Benefits: Expired in mid-January

Wilson says she was one of more than 20 people who were laid off by her former company as the newspaper’s ad revenues declined. “Since then I’ve been doing a little bit of everything that’s legal,” she says. “I completely gave up on advertising and marketing because so many of my friends in the field have gotten laid off.” Wilson says she’s applied at Target (TGT), Wal-Mart (WMT) and Home Depot (HD) for any available position. Her husband, 39, works as a firefighter and his income covers their mortgage. Wilson sold all her jewelry (expect her wedding band) to pay for groceries and bills, and started freelancing. She wiped out her 401(k) before her layoff when her uninsured father-in-law became ill. Wilson's husband’s 401(k) remains untouched, but they’ve gone through their savings. They have three children, ages 3, 14 and 19, and luckily her oldest son received a full scholarship to attend college this fall, she says. As for the youngest son, Wilson took him out of day care and now watches after him herself.

RICHARD GEESLIN: Running through retirement savings.

Age: 61
Location: Austin, Texas
Previous Job: Office manager, salesperson and equipment installer for a small business that sold home entertainment systems
Unemployed Since: May 2008
Jobless Benefits: None

The day that Geeslin began work at his former employer he says he was informed that he wouldn’t receive health insurance or any benefits. So it came as no surprise when he -- the only employee at the company -- was laid off without severance. Then came the real shock: Geeslin says he couldn’t qualify for unemployment benefits because his employer had listed him as an independent contractor. Over the past year, he’s been using his retirement fund -- a mixture of savings accounts, CDs and stocks -- to pay for his mortgage and everyday expenses. (He hasn’t touched his 401(k), which he started in 2001 and holds about $22,000.) Geeslin says he’s avoided credit-card debt and he doesn’t have a spouse or children to support. “Financially it’s a good thing, but mentally you’re out here on your own,” he says. To make some money, Geeslin's been giving private tennis lessons, something he says he did full time from the late ‘70s until the ‘90s.

SMARTMONEY ® Layout and look and feel of SmartMoney.com are trademarks of SmartMoney, a joint venture between Dow Jones & Company, Inc. and Hearst SM Partnership. © 1995 - 2009 SmartMoney. All Rights Reserved.

Asia stocks ease on nagging U.S. economy worries (Reuters)

Reuters - Asian shares retreated from seven-months highs on Thursday as concerns grew that rising yields on U.S. government debt could push up borrowing costs and choke off a potential recovery in the world's largest economy.

Budget 09: Credit rating agency casts favourable eye on Budget

U.S. plan to buy banks' bad loans stalls: report

Budget 09: How the Herald analysts see it

Budget 09: Mixed reaction to Nats' first Budget

Budget 09: Govt to sell more bonds to fund deficits

Revamped offer ready for investors in suspended ING funds

Budget 09 : NZ Super rates remain the same, despite slashing fund contributions

Rising Treasury yields threaten recovery

A peasants' revolt in the new age of brutality

The Choice for Labour

Write-Offs: 05.27.09

$$$ Einhorn's next victim [Cityfile]

$$$ "Why the US will not get downgraded" [FT Alphaville]

$$$ The Cost Of Taking Time Off [The Atlantic]

Yahoo and Microsoft ease off over tie-up

Rise in taxes on US petrol 'not feasible'

Samberg to close fund after probe reopens

Layoffs Watch '09: BarcLehs Is Having Itself Some Fun!

Re: the cuts that went down earlier today at Barcap, a bit more color:

The Energy Group was affected, as well. One guy, headed in thinking he was having a talk about "transferring to London" was instead told, "Well, this is not the conversation you thought we were going to have."

Big Lebowski Cheney Would've Let GM Fail

As previously mentioned, Larry Kudlow sat down with Dick Cheney earlier today to have a good bitch sesh at the current state the economy, etc. The full interview airs tonight at 7PM, but ahead of the clip, we're going to have to go ahead and assume, based on the transcript, that this thing will be uproarious. We wondered earlier how and why this one-on-one came to pass (especially after the network was scolded for a lack of fair and balanced content), guessing that it was a necessary prelude to K 'n C getting down to the business of weeping and holding each other closely during this time (T minus four years) of need. From the looks of it, we weren't too far off. Before the crying, however, comes the sex, and before the sex, the dancing:

Kudlow: Let me ask you, sir, is there an economic recovery out there in your view?

Cheney: Well, Larry, I'm reluctant to tell an economist what's going on in the economy.

Kudlow: It never stopped you in the past.

Cheney: Well, that's true. It never stopped me before.

Regardless of your political persuasion, join me ask I ask, what the hell is this awesomeness we're beholding? "It never stopped you in the past," Kudlow demurred, rubbing his foot up Cheney's pant leg. "That's true," the former VP said with a knowing snarl smile on his face, remembering that time at the lake. "It never stopped me before."

Presented Without Comment: No, That's Not A Joke

Steven Rattner, head of the U.S. Treasury Department's automotive team, has a net worth of at least $188 million and held shares in an investment fund run by the majority owner of Chrysler LLC, according to his financial- disclosure statement.

Rattner, co-founder of Quadrangle Group LLC, also bet as much as $150,000 on General Motors Corp.'s senior secured loans using a credit-default swaps index that guarantees the secured debt of 100 companies, including GM, the filing shows.

Rattner Worth at Least $188 Million, Disclosures Show [Bloomberg]

Presented By:

Isle of Capri Rated `Hold' in New Coverage at Noble Financial

Morse Says Rising Oil Prices Motivated by Recovery Speculation

SEC files fraud charges against Pegasus Wireless (AP)

SEC files fraud charges against Pegasus Wireless (AP)

Malpass Sees U.S. Unemployment Surpassing 10%

CNBC: Pequot To Perish

Pequot Capital Management begins the several month-long wind-down.

Conspiracy Update: Related?

N.Y. Cuts Pension Ties to 10 Fund Managers, Report Says

Four of the 10 firms that it has severed ties with were listed, but not charged, in an indictment brought by Mr. Cuomo's office against two top associates to Alan Hevesi, the former comptroller, The Daily News reported. Those four are Consulting Services Group, HFV Management, Olympia Capital Management and Pequot Capital Management, it said.

The Wall Street Journal has it: "Pequot Capital to close amid an ongoing SEC-DOJ probe into possible insider trading."

"Public disclosures about the continuing investigation have cast a cloud over the firm and have become a source of personal distraction," Mr. Samberg wrote in a letter that was sent to investors of his Pequot Capital Management Inc. late in the day on Wednesday. "With the situation increasingly untenable for the firm and for me, I have concluded that Pequot can no longer stay in business."

Letter from Samberg, via the Journal:

May 27, 2009

To Our Clients and Friends:

I am writing to you, our loyal clients and friends, to let you know that I have reached the painful conclusion that it is necessary to wind down Pequot's business.

In the coming months, we plan to liquidate the Core Funds and return cash to investors while spinning out Matawin under the leadership of Mike Corasaniti and Special Opportunities under the leadership of Rob Webster and Paul Mellinger.

The Dow Jones industrials' moves since Lehman fall (AP)

How the major stock indexes fared Wednesday (AP)

Auction Time

Some nice suggestions from Donald Marron to end the tyranny of the TARP, but we despair that they shall ever come to pass.

Treasury should give up on negotiated sales and simply auction the warrants it received through its TARP investments. Auctioning the warrants will:

* Enhance the transparency of the process (since no one can accuse Treasury of playing favorites in the auction);

* Ensure that taxpayers get a fair return on their investment (since the warrants will be sold at their real market value);

* Allow banks, if they choose, to preserve needed capital (if investors purchase the warrants, banks won't have to use up any of their scarce capital); and

* Free banks from the nuisance of government involvement (since banks get free of TARP even if private investors end up purchasing the warrants).

The reality is that the TARP has been far more useful to the Treasury and the Administration in general as a cudgel than as a stimulus and bank support program. Donald's first and last points are, in fact, bugs, not features to a Treasury that, for example, negotiates the results of stress tests with its regulatees. Of course, it would be interesting if The Big Guy financed minimum pricing limits on the warrants.

[Donald Marron via Alea]

Hear: Listen To Your Parents

No commerce in Columbus. daneyocco/Planet Money Flickr pool

 

On today's Planet Money:

-- Chrysler went to bankruptcy court in New York City today. At issue was the question of whether Chrysler can sell a significant portion of itself to the Italian automaker Fiat. As Frank Langfitt tells us, there's much more at stake, not just for Chrysler, but for GM and the future of American capitalism.

-- Jim Higgins has a lot to lose from Chrysler's bankruptcy. The Chrysler dealership he works for, in Fairfax, Virginia, learned this month that it's among the 789 the company plans to close.

-- Think your elders are more frugal than you? Listener Jean Jakab commented on the blog that her son, Steve Jakab, had just lost his job and was floundering, and that all you really needed to do was be careful with his money like Mom and Dad. We got Jean and Steve on the phone, and lo and behold, Steve was already following their advice -- and had been for a while.

Bonus: A indicator from academia.

Download the podcast; or subscribe. Intro music: Say Hi's "One, Two . . . One." Find us: Twitter/ Facebook/ Flickr.

Brooks Miner writes from Seattle:

Here's my indicator: 96. This is the number of TA positions that we will have in the University of Washington Department of Biology next year (2009-2010, over three academic terms -- autumn, winter, and spring). Last year our same department, with a similar number of undergraduate majors and courses offered, had 140 TA positions.

There are a whole bunch of ways this will affect the way we teach biology and the experience of being a student here.

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A Job Opening And A Reminder: It Could Be So Much Worse

Yes, your boss might verbally abuse and berate you in front of the team for one down month. She might shove her stiletto up your ass for daring to disagree with her outlook on Vikram Pandit's hairline. He might throw an empty bottle of whatever's on his desk at your head for even hinting that buying another investment bank might not be the best way to ingratiate himself to shareholders. He may smash every monitor within arm's length when unprecedented market volatility doesn't land in his favor, such that walking into his office without shoes would be extremely dangerous. But he most likely doesn't pull this shtick.*

The CEO of the nation's largest linen company went berserk and brutally beat his housemaid in his posh Upper East Side apartment -- leaving her with swelling on the brain, officials said. George Bardwil, 57, who runs Bardwil Home, was charged with second degree assault in Sunday's savage attack that left the maid unconscious in a pool of blood. The maid - who was only on her second day on the job - told police that when she arrived for work that afternoon, Bardwil opened the door and began pummeling her. After repeatedly striking her on the head and face, Bardwil then dragged her across the floor to the living room where she blacked out.

[...]

Bardwil initially told police he found the maid lying on the floor when he came out of the shower and called for help...But he later admitted that he struck the woman because she had stolen money from him. "She saw where I kept an envelope with $5,500 in it. I know she took it. When she wouldn't admit it, I hit her three times in the head with my closed fist," he said.

Linen CEO Beat His Maid [NYP via Cityfile]

*Or does he? In which case, give us a call. We're good listeners!

Chevron annual meeting draws activists

Morgan Stanley Hires (Another) Football Player

Another day, another pro-athlete added to the Morgan Stanley roster as part of an elaborate scheme John Mack's been cooking up, the details of which are yet to be revealed. Today it's New York Jets wide receiver Wayne Chrebet, as a financial adviser (previously, it was Carolinas wide receiver Steve Smith, as an intern; tomorrow, OJ, as a compliance officer).

Chrebet is joining the Moldaver Group, a wealth-management team with six investment professionals at its Red Bank office, New York-based Morgan Stanley said in a statement today. He has been at Morgan Stanley about six months and recently completed all his tests and training to become a financial adviser. Chrebet holds an undergraduate degree in criminal justice from Hofstra University.

"Ever since I made my first dollar I made it a point of learning about the market, learning where my investments are," Chrebet said. "I've always helped out the younger guys through my career and some of the other players who weren't as knowledgeable and took pride in that...It's a great second career for me."

Nice! Heartwarming and all that. Of course, probably difficult to take for the guys who were making it their first careers until the hatchet man came a' calling, and don't have the luxury of taking the position Chrebet left vacant with the Jets, but what can you do. This, however, is troubling:

"Obviously you don't hear 70,000 people cheering for you when you are doing this, but it's exciting," Chrebet said in a phone interview. "I love it."

Don't hear 70,000 people cheering for you when you're doing this? On behalf of, let's just go with Jim Simons, who has a stadium's worth of SUNY Stony Brook students he bussed in do a little dance every time he makes a buck, we say, speak for yourself. As for the rest of you-- dream big.

Living With Foreclosure

F is for foreclosure. Love in the Time of Foreclosure

While we try to figure out the best way to keep track of your struggles to get your mortgages modified, check out this blog of one couple's journey -- Love in the Time of Foreclosure. Here's a taste:

In today's mail, we received 7 more NOTICES OF TRUSTEE'S SALE.

Seven. Enough to form an F.

As though the 12 total notices we've received via mail so far weren't enough, there was another posted on our garage door today for all the world to see.

We discovered it as we were leaving to see a movie-- an attempt to carve out a little bit of fun in this long weekend. We stepped out onto the driveway and there it was. In plain view. BAM! The thing that we've been trying desperately to avoid for months.

I tore it down immediately out of embarrassment. Hoping none of our neighbors would see. It wasn't until later in the day after having some time to cool down that I taped it back up for purposes of this photo.

How I felt? Like a big loser. Like a failure. And afraid.

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12 Must-Read Summer Business Books

Escapist fluff should make a big comeback this summer. In a world of bad economic news, who wants to read about business?

Odd as it may sound, however, now is an especially good time to pick up business books. A delicate economy and stiff competition beg you to hone your skills, not ignore them. The list below represents a healthy mix of topics, with a few parables and a true-crime story thrown in to satisfy the urge for summer fun:

1. Atlas Shrugged
by Ayn Rand

What happens when the government takes control over private industry? Atlas Shrugged, first published in 1957, describes a dystopia that is especially relevant today. The Wall Street Journal’s Stephen Moore has an excellent description of the themes in Atlas Shrugged:

Politicians invariably respond to crises — that in most cases they themselves created — by spawning new government programs, laws and regulations. These, in turn, generate more havoc and poverty, which inspires the politicians to create more programs . . . and the downward spiral repeats itself until the productive sectors of the economy collapse under the collective weight of taxes and other burdens imposed in the name of fairness, equality and do-goodism.

The 1,000+-page Atlas Shrugged describes Rand’s Objectivist philosophy through the allegory of protagonist Dagny Taggart, the VP of Operations for the world’s biggest railroad company. The government drives Taggart’s company into bankruptcy through red tape and taxes, compounding a national problem of disappearing industrialists. When the government finally drives industry into the ground, it calls on John Galt, a heroic businessman, to save the economy.

Though the book can be laborious at times, Rand’s eerily poignant descriptions will provide valuable perspective on life in America today.

2. 10-10-10
by Suzy Welch

Former Harvard Business Review editor-in-chief Suzy Welch challenges readers to ask three deceptively simple questions: What are the consequences of a given decision in 10 minutes? 10 months? 10 years? Welch describes how the 10-10-10 method crystallizes even the most difficult decisions, helping people make choices true to their values. This relatively short, engaging read uses anecdotes and Welch’s personal story to help readers harness 10-10-10 in work, love, career, child-rearing, and everyday decisions. A fun, worthy, and inspiring read.

3. The Forgotten Man: A New History of the Great Depression
by Amity Shlaes

Many accounts of the Great Depression highlight the heroism of FDR’s New Deal, while criticizing the bankers and Republicans behind the excesses of the 1920s. Shlaes, on the other hand, claims FDR prolonged the Great Depression through experimental, anti-business, and politically charged policies. Shlaes expresses her argument through stories of individuals during 1927-1940. By diving into the heads and hearts of policymakers, businessmen, economists, activists, and the victims of restrictive regulations—small businessmen—Shlaes brings a human element into an oft-dry topic. Any taxpayer who feels “forgotten” during today’s bailouts will benefit from the perspective this 433-page book offers.

4. The Informant
by Kurt Eichenwald

It’s hard to believe that this true crime story, starring agribusiness giant Archer Daniel Midland (ADM), isn’t a novel. The meticulously researched story recounts the six-year FBI price fixing investigation of the company that started in 1992. The FBI thought that star witness and ADM executive Mark Whitacre would seal their case against ADM, but soon discovered that Whitacre was manipulating them in order to cover up his own crimes. Eichenwald, a New York Times journalist, turns months of dry research into a page-turning thriller. ADM’s size and scope—their CEO, for example, singlehandedly ensured corn syrup became the national sweetener—make this exciting book both relevant and frightening.

5. American Lion
By Jon Meacham

This Pulitzer-winning book brings to life President Andrew Jackson, the famous face on the $20 bill. The story follows Jackson through his eight years in the White House, describing his motivations, character, and past in incredible detail. The author endears Jackson to readers not as a legend, but as a very human leader. For example, an excerpt from the prologue, typical of the book’s style, reads:

Jackson was fond of well-cut clothes, racehorses, dueling, newspapers, gambling, whiskey, coffee, a pipe, pretty women, children, and good company.

At 340 pages, the book is long, but its high entertainment value melts away the hours. An illuminating read for anyone curious about Jackson or American history in general.

6. Street Fighters: The Last 72 Hours of Bear Stearns, the Toughest Firm on Wall Street

Wall Street Journal writer Kate Kelly covered Bear Stearns’ collapse in three popular WSJ narratives. Street Fighters is the expanded version of those articles, detailing the financial giant’s collapse hour by hour. Her coverage of the individuals involved, from paralyzed CEO Alan Schwartz to former Secretary of the Treasury Hank Paulson, gives a potentially anonymous Wall Street catastrophe a human face.

7. Peaks and Valleys
by Spencer Johnson

This short, quick read uses the parable of a young man leaving his comfort zone (a steady, but boring valley) to explore new heights of success and satisfaction (peaks). Johnson, teaching through the wise old man who guides the young man on his journey, emphasizes that peaks and valleys are connected. Making wise decisions during valleys, or down times, will help create peaks, or good times. The converse—making bad decisions during good times—will lead to deeper valleys. Ups and downs are inevitable, but navigating them effectively makes for more peaks, less valleys, and a more fulfilling life overall. If you’re dealing with painful change, this book will help level your outlook.

8. More Mortgage Meltdown: 6 Ways to Profit in These Bad Times
by Whitney Tilson and Glenn Tongue

Fund managers Tilson and Tongue offer readers six easy ways to profit off investments, even during the worst of times. They start by explaining, in laymen’s terms, what caused the bubble, what happened when it burst, and why the global financial disaster isn’t over. Once readers understand the crisis’ dynamics, the authors describe how to take advantage of the crisis by value investing. They highlight their techniques using case studies, including Berkshire Hathaway and American Express. Overall, the book is a useful primer—and reminder—about value investing during difficult times.

9. How The Mighty Fall: And Why Some Companies Never Give In
by Jim Collins

Good to Great author Jim Collins spent four years researching why great companies fail. He discovered that most declines happen in five stages. Once leaders understand each stage, they can identify and arrest their company’s impending failure. Using case studies, including US and Bethlehem Steel, Motorola, and GM, Collins explains how and where specific giants went wrong. His messages: Companies can look outwardly strong, but be on the verge of a bad fall inside. Hubris, lack of discipline, and denial of risk lead to falls. The ability to rebound from setbacks, rather than the absence of them, defines strong companies.

If you want to learn the patterns of how eminent companies corrode from the inside, as well as lessons on avoiding that fate, this is a must-read.

10. The Box
by Marc Levinson

The topic matter sounds boring at first glance—shipping containers are decidedly unsexy—but Levinson crafts a fascinating story on the rise of globalization using the innocuous-sounding box as its vehicle.

Consider some of the consequences of the shipping container:

-Tearing open world markets
-Enabling exponential growth of business
-Making Asia the world’s manufacturing hub
-Killing some trading ports, while helping others burgeon
-Leveling an old union-driven way of life
-Restructuring the world economy

With these outcomes, the box actually becomes exciting. Levinson skillfully weaves in the story shipping container inventor Malcom McLean, adding life to business history. Divided into fourteen easily-digestible chapters, The Box is an illuminating, fun read.

11. Selling the Wheel
by Jeff Cox and Howard Stevens

Uses the parable of a man trying to sell a wheel in ancient Egypt, Selling the Wheel teaches that in order to be effective, companies need to tailor their sales tactics to different types of customers. The main message is that there is no such thing as a universally effective salesperson. Instead, companies need to provide value to one of four different kinds of customers, each with unique needs. Only then can they gain a true competitive advantage. Selling the Wheel is a short, engaging reminder that sales tactics truly matter, especially during times of stiff global competition.

12. Barack 2.0: Barack Obama’s Social Media Lessons For Business
by David Bullock and Brent Leary

Using social media to help win an election might be considered the pinnacle of the medium. Love it or hate it, Obama campaign’s brilliant use of social media helped catapult him to the presidency. Social Media Lessons for Business examines the campaign’s use of Facebook, Twitter, YouTube, and other applications as a case study on how businesses can effectively use social media. Obama’s real-life example will help businesses define an effective social media strategy. The short book’s step-by-step format makes strategizing easy.

Hastings Says GM Debt-Equity Swap Designed to Fail

Forrester's Owyang Says Facebook Is Focused on Global Growth

Lavorgna Says U.S. Home Prices Are Still Declining

Keller Calls Chrysler Plan `Pure Fantasy'

Mafia Sailing Through Recession

Apparently, it's all about cash.

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Time Management: More Popular Than Weight Loss

Like many freelancers, I find myself trying to pack more into a 24-hour day than is humanly possible. It’s not just us lone business people who do this. I know plenty of professional, executives, and full time parents who do the same thing. And what do we do when we simply run out of time? Those of us who are tasky, solution-minded, Type As reach for help, as evidenced by an entire industry that is based on helping us manage our most limited resource: time.

Time Management vs. Weight Loss

The time management industry is like the weight loss industry. (And both of these I would say probably come in behind the Get Rich Quick industry, but that’s for another post.) Everyone knows the real answer to these modern problems. To lose weight you eat less and move more. To manage your time you take on less and concentrate harder on what you do tackle. But the simple things are so very, very difficult to accept.

There’s a whole industry built around our denial. Plenty of products promise to help you manage your time or your weight. Searching Amazon I found these top 10 department results:

For the search term “weight loss”

• Health & Personal Care (14,108)
• Books (74,358)
• DVD (384)
• Sports & Outdoors (1,018)
• Grocery (1,909)
• Kindle Store (882)
• MP3 Downloads (514)
• Everything Else (264)
• Home & Garden (208)
• Music (147)
  Total: 93,792 Items

For the search term “time management”

• Books (95,409) - (My favorite, Getting Things Done, has practically spawned a cult of productivity!)
• MP3 Downloads (130)
• DVD (16)
• Kindle Store (513)
• Office Products & Supplies (181)
• Software (127)
• VHS (37)
• Home & Garden (36)
• Apparel & Accessories (26)
• Watches (25)
  Total: 96,500 Items

Can you believe that? I honestly expected weight loss to beat out time management by a hearty margin. You know, on account of all those ‘health’ and ‘grocery’ items. However, this little experiment proves my point and one other thing - clearly we need some sort of time management pill!

Image Credit: Photos8.com, Flickr

Geithner Calls for Change in Wall Street Pay Practices

Buying Time In Texas

Overgrown in Los Angeles. xomeo/Planet Money Flickr pool

 

Louise shares this economic indicator:

20 - the percentage of people I work with who have closed on their first home in the past 2 months. Out of a work group of 25 people, five have finalized a home purchase recently. We work in IT for a state agency in Texas, so our jobs are fairly stable right now. The real estate market in Austin has begun perking up after a mini-slump during the past 6 months, and between the low interest rates, lower home prices, and tax incentives, the young professionals I work with have decided that there is no better time to buy than now.

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How U.S. became a bailout nation

Sotomayor not a justice for these times

Interest groups battle over Sotomayor

High-end retailers 'pop up' then go bye

U.K. expense brouhaha triggers reform

Banks up to old tricks with salary raises

What government stake in GM means

Why bondholders have so much power

Macquarie Bank's Gammel Sees Trough in Oil Prices

Merkle Says Pricing Power Is Real Concern for Chrysler

Ferris Bueller House for Sale in Chicago

The Highland Park, Chicago home featured in “Ferris Bueller’s Day Off” (1986) is being listed by Sotheby’s for $2.3 million. The Chicago Sun-Times has more:

The Ben Rose Home, set for Cameron Frye’s house and the infamous Ferrari scene in the movie staring Matthew Broderick, is comprised of two buildings of steel and glass construction, cantilevered over a ravine. They were designed by noted 20th Century architects A. James Speyer and David Haid.

• Built: 1953
• Bedrooms: 4
• Bathrooms: 4 (full)
• Rooms details: 20×18 master bedroom, 42×35 family room, 40×25 living room, 20×16 kitchen, and dining room
• Size: Approximately 5300 sq. ft., one story, approximately 3/4 acre.
• That garage: 3-car, detached
• Amenities: Gas fireplace, central air, Lake Michigan water

Does “as is” refer to a certain broken window that the owners haven’t fixed since, say, 1986? (See minute 4:44 of the YouTube clip above…)

China's Not Budging

Where growth still = recession. Brown Brothers Harriman

 

This is what counts for a recession in China: an economy growing at only six percent. In the U.S., financial types are warning of a recovery in which gross domestic product tracks upward at just 2 percent, compared to the old norm of 3 percent.

But for China, which remains at once a poor nation and a trillion-dollar creditor for the U.S., growing at a quite high rate is the only way to provide jobs and a decent standard of living for all its citizens.

China has signaled that it intends to pull out of its slump in part by supporting its export sector. Key to that is keeping the yuan weak against the dollar, so Chinese goods remain attractive for consumers. China's State Council is welcoming a visiting Treasury Secretary Tim Geithner this week with news that it intends to keep the yuan "basically stable."

"In other words, China is warning Geithner not to make a big stink about the exchange rate when he comes," Thin says. "And to serve notice, China tweaked the exchange rate weaker this week."

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JetAmerica Airlines (Skybus II) Offers $9 Flights

JetAmerica Airlines, a new low-cost carrier, is offering limited $9 fares between select East Coast and Midwest cities starting July 13. The St. Petersburg Times reports:

The tiny carrier will connect only small and mid-sized cities to the New York metro area and Minneapolis. This venture follows the no-frills, pay-as-you-go model of Irish powerhouse Ryanair and U.S. discounters Spirit Airlines and Allegiant Air. Fares will start at $9 each way for the first nine to 19 seats and top out at $199 one way.

The four initial cities — Toledo, Ohio, South Bend, Ind., Lansing, Mich., and Melbourne on Florida’s east coast — are subsidizing JetAmerica by waiving airport fees and helping with marketing and advertising.

Weikle is tenacious. Skybus, which failed last year, also had a similar business model to Ryanair’s. Skybus, like JetAmerica, served small- to medium-sized cities. Skybus sold ten seats on each flight for $10–just like, you guessed it, JetAmerica. And Skybus’ Columbus, OH hub subsidized the airline to the tune of $57 million.

Remember that Einstein quote, “the definition of insanity is doing the same thing over and over again and expecting different results?” JetAmerica has an almost identical business model to Skybus. Skybus folded after 10 months, stricken to rising fuel costs and a slow economy. What will stop Jet America from failing, too?

I found one possible difference mentioned in a USA Today article. Skybus owned its fleet, while JetAmerica will rent:

Weikle said in the statement that despite a deep recession and a double-digit drop in passenger traffic, now “is actually a good time for a start-up because airlines are cutting flights.”

The company has contracted with Miami-based charter carrier Miami Air International to provide and operate the aircraft. Though flights will be scheduled, the JetAmerica operation will be classified as a public charter, not as a scheduled airline.

I question whether the new plan will work.

In Pain? Count Cash

They make you feel better. Steve Rhodes/Planet Money Flickr pool

 

Counting cash can make you feel better, at least according to this new study. In one experiment, the researchers had students count either money or paper, then plunged their fingers into hot water.

The students who had counted money felt less pain.

"Handling money . . . reduced distress over social exclusion and diminished the physical pain of immersion in hot water."

Apparently it doesn't even have to be your money.

There was a downside though.

"Being reminded of having spent money, however, intensified both social distress and physical pain."

And I should add that the study was done with Chinese currency. But try it out with greenbacks and let us know how it works for you.

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Survey: Most economists see recession end in '09

When Arsonists Meet Building Regulations