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Posted
Aug 27 2009, 07:20 AM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
 This article is written by Minyanville's Andrew Jeffery
After four years of searing pain, the U.S. housing market is finally showing signs of life. And even as the causes and relative sustainability of this nascent “recovery” are being hotly debated, traditional buyers and investors alike are jumping into the market for homes with both feet. It now appears that the biggest, baddest investor of them all, the one with infinitely deep pockets, is wading into the fray: Uncle Sam. According to HousingWire, the U.S. Department of Housing and Urban Development, or HUD, is giving state and local governments a total of $50 million to help deal with the onslaught of foreclosed homes, many of which lie vacant and blighted, ripe for vandalism, squatting, or worse. HUD has allocated chunks of cash to national development groups and local community organizations hoping to plug holes left by the private real estate investment market. Bing: US Housing Market
Funds are being distributed through the Neighborhood Stabilization Program, which was established by former President George Bush in Economic Stimulus part one and expanded by President Barack Obama earlier this year.
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Posted
Apr 28 2009, 03:48 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
By the middle of the year, the federal government will own large, and in some cases, controlling interests, in two car companies and several major banks. There is a chance the the extent of rescue efforts and government ownership could move to auto parts suppliers and insurance companies. If the Treasury can pick up stock in Cisco (CSCO) and Intel (INTC), it can control most of the important sectors of the economy. That raises the issue of how the federal government gets all of that taxpayer money back.
The Wall Street Journal has reported that Citigroup (C) and Bank of America (BAC) have done poorly on their “stress tests”. Each bank may be encouraged to raise more capital. As a number of analysts have pointed out, private equity has no interest in stakes in troubled banks, even at a steep discount to current market values.
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Posted
Jul 10 2009, 11:33 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
 Aw, "courtesy overdraft protection" sounds so nice. If you spend beyond what you have in your bank account, the bank will automatically cover for you. How helpful.
But then comes the big fee, of course. And so banks are major fans of the courtesy overdraft. In fact, overdrafts are the single-largest driver of consumer fee income for banks, according to USA Today. This year, banks will get a record $38.5 billion in overdraft fees. The banks are making it easier than ever to overdraft. Bank of America (BAC) lets customers overdraw 10 times a day, USA Today reports. Good luck getting an overdraft fee refunded.
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Posted
Oct 06 2009, 01:48 PM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
This article is written by Minyanville's Megan Barnett This week has seen yet another round in the battle between Goldman Sachs (GS) and the Rest of the World. See also, Goldman Sachs Lightning Bolt Sparks Rally. On Monday, Goldman Sachs analysts Richard Ramsden and Brian Foran upgraded their outlook for big banks from neutral to attractive. The news sent shares of JPMorgan (JPM), Bank of America (BAC), and Wells Fargo (WFC) sharply higher. And yes, even Goldman Sachs shareholders benefited from the news, as its shares jumped nearly 4%.
The upgrade baffled many banking analysts and it came against a backdrop of negative opinions. And these aren't just slightly bearish views -- they're downright scary outlooks that suggest some of the worst still lies ahead for banks and the rest of the economy. Here's a sampling:
Meredith Whitney, the analyst who made her name as a banking bear at the start of the credit crisis, penned an op-ed for the Wall Street Journal last week in which she predicted that small businesses will become the next victims of the crisis since their access to credit is being denied by banks and other lenders. She believes “we are only in the early stages of the second half of this credit cycle."
George Soros reiterated his gloom for a roomful of global financial policy wonks in Istanbul yesterday, saying that the US economic recovery will be extremely slow thanks to the “basically bankrupt” banking system at its core.
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Posted
Mar 12 2009, 03:15 AM
by
Bernhard Warner and Matthew Yeomans
Rating:
Money Blog: Top Stocks Blog - MSN Money
This post comes from partner site The Big Money.
Rogue financier Bernard Madoff is expected to plead guilty today to operating a vast decades-long fraud, and details of his elaborate international Ponzi scheme continue to emerge. The Wall Street Journal leads its coverage today with details that Madoff used his London office to launder cash in a type of carousel trade, "transferring client money from the investment-advisory business in New York to London and then back to the U.S. to support the U.S. trading operation of Bernard L. Madoff Investment Securities LLC, and also for his personal benefit and for family members and associates." The revelation means British authorities have opened up an investigation of their own into the alleged fraudster's dealings, the newspaper adds.
According to the New York Times, after today's plea hearing in federal court, "there is a strong chance that [Madoff] will not return home." The most suspenseful moment today will come after the plea, the newspaper writes, when Madoff's attorneys will argue that the judge ought to preserve his $10 million bail agreement and let him resume living in his penthouse apartment rather than wait out the next few weeks (or few months) until he's sentenced behind bars. He may be guilty of running the largest financial fraud in history, BusinessWeek notes, but does a potential life sentence for Madoff fit the crime? The magazine talks to a variety of trial attorneys, and their verdict is not heartening for Madoff
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Posted
Sep 29 2009, 11:15 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
 Bank of America (BAC) is already in hot water for its suspicious acquisition of Merrill Lynch last year. Now, the heat is getting turned up a notch.
The Ohio attorney general wants billions of dollars from Bank of America and its executives over the way it handled the Merrill purchase, the Wall Street Journal reports. Attorney General Richard Cordray has sued the bank on behalf of five pension funds. The lawsuit alleges that the bank and its executives hid Merrill's financial situation before shareholders voted to approve the deal in December. The pension funds had filed five different lawsuits, and have now joined together in one megalawsuit, with Ohio leading the charge. It's a safe bet that other shareholders are on the phone with lawyers, too.
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Posted
Jun 17 2009, 11:33 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
Outspoken banking analyst Dick Bove says there is much to like about Bank of America (BAC) these days. He thinks the stock price will rise 40% above his last target price to $19, and may even triple in the next few years, according to the Tampa Bay Business Journal. Shares were in the $12-$13 range Wednesday. Bove is bullish because he says bank stocks are starting to be valued based on earning power rather than tangible common equity ratios. Claims that the banking industry was insolvent were wrong, Bove wrote to clients. In fact, banking will survive and multiples on bank stocks are beginning to grow, he added. Still, things are going to be rough for B of A in the short term, Bove said.
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Posted
Jun 22 2009, 11:53 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
I wrote a post last month naming four directors who should resign immediately from Bank of America's (BAC) board. The board was ripe for housecleaning, especially since only two directors (besides the chief executive) had any experience in banking. Now, three of those four directors are gone. And others have left as well. This is great news for the bank, which needs people on board who know
the business and can react quickly in these difficult and changing
times. For a long time, banks could get away with a country-club atmosphere in the boardroom, where friends and family members were rewarded with big perks and high fees. But after banks became ground zero in the financial crisis, many are being pressured to clean up their boards.
Who resigned? The most obvious candidate, O. Temple Sloan Jr., stepped down after 13 years. Sloan was lead director and a bigshot on Bank of America's board. He spent most of his career running an auto parts company he founded in North Carolina, and how this qualified him to lead a bank is beyond me.
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Posted
Mar 09 2009, 05:41 AM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
As lawmakers busily laud their own efforts to unlock credit markets and jump-start lending, consumers yawn. They just don’t want to spend.
And it’s not just those out of work who are paring back expenditures. According to The Wall Street Journal, even the dwindling ranks of the employed are getting thrifty. Computer users are enduring slow machines rather than buying new ones, clothes-shopping trips are being delayed and coupon clipping is once again the vogue.
Discounters like Wal-Mart (WMT) are benefiting from bargain hunters looking to save a couple of bucks, while AutoZone’s (AZO) stock sprinted to a 52-week high last week, as drivers opt to do it themselves.
Politicians, rushing to restore the “prosperity” we so recently enjoyed, are confident this is just a passing fad, and that we’ll soon return to our spend-happy ways. Indeed, the viability of President Barack Obama’s new $3.4 trillion budget is predicated on the U.S. economy skipping along at a 3.4% growth rate next year -- and expanding even faster in 2011.
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Posted
Jul 28 2009, 07:34 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
Analysts have hoped that the rate at which Americans become unemployed will slow in the second half of 2009. There has been some evidence that the period in which the economy would lose 600,000 or more jobs a month is over. That may not be the case.
The press has observed that layoffs are one of the main reasons behind improved earnings in the second quarter. Sales at many companies are not up, but expenses are down, in many cases considerably. But, second quarter results may not only be the result of jobs cuts; they may be the cause for more, which will mean that the period in which the economy faces rapidly rising unemployment is not over.
Verizon (VZ) announced that it will cut 8,000 jobs. Its results for the last reporting period were below par. The recession is one reason for that. Another is that customers are canceling their landline phones and using cellular phones or VoIP instead. The poor economy and new technology are overwhelming Verizon’s old way of doing business. The same thing has happened to AT&T (T).
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