Browse by Tags
-
Posted
Sep 30 2008, 09:47 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
Congress wants to crack down on CEO mega-salaries for banks participating in the bailout. And while the politicians argue how best to do that, Alan Fishman of Washington Mutual is headed for the doors with $19 million in his pocket.
If that wasn't outrageous enough, consider this: Fishman started the job three weeks ago. I never saw the employment ad Fishman answered, but it must have read something like this:
WANTED: Top executive for train-wreck bank about to be seized by federal regulators. Must be able to look busy while FDIC sells business from under you. Previous experience with angry shareholders sitting on worthless stock a plus. Perks: $7.5 million hiring bonus and $11.6 million cash severance.
Fishman got the best temp gig in history.
Read More...
-
Posted
Jun 16 2009, 02:40 PM
by
Catherine Holahan
Rating:
Money Blog: Top Stocks Blog - MSN Money
 The worst recession since the Great Depression will
officially end sometime in the next three months, according to economists at
the nation's biggest banks. The Economic Advisory Committee of the American
Bankers Association -- aka the chief economists for JPMorgan
Chase, Citigroup,
Bank of
America, and most other major banks -- announced today that they expect that
nation's GDP to grow in the third quarter of 2009.
But most Americans will still feel as though they are living
through a recession well into 2010.
"The economy will return to growth but not to
health," said Bruce Kasman, chief economist for JPMorgan Chase in a
statement. "Growth in the coming quarters is likely to gather momentum but
will not prove sufficiently robust to undo much of the severe damage to our
labor markets and public finances."
Read More...
-
Posted
Sep 26 2008, 03:54 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
Washington Mutual failed yesterday and most of its assets where sold to JP Morgan. The price was $1.8 billion. JPM will have to write down $31 billion in bad loans, but, since Jamie Dimon is now the king of the banking world, he should be able to raise the capital to cover that. In the meantime, he has picked up $307 billion in assets.
According to The Wall Street Journal, "The deal will vault J.P. Morgan into first place in nationwide deposits and greatly expand its franchise." The people who get drawn-and-quartered in the process are the WaMu bondholders and those who own the common stock. Washington Mutual shares were at over $36 a year ago. Now, they are worth nothing. About $50 billion in market cap has been destroyed.
The failure, the biggest in U.S. history, does not mean much. Depositors are protected. The beating shareholders take is no different than any other when a large company fails. The system worked well. A healthier firm got the pieces of the failed firm on the cheap. JP Morgan will be the better for the deal and when the financial markets recover, the purchase of WaMu's assets may look like the deal of the century.
Read More...
-
Posted
Oct 24 2008, 06:39 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
No matter where economists look there is no evidence that a recession in the US, EU, and Asia is doing anything but deepening. The stock markets are the least of it. Some of the indexes in the largest countries are off 40% from their peaks reached a year ago. Banks are failing. In cases where the government has not stepped in some have disappeared and others have been merged into more healthy institutions. Healthy for now, that is.
The financial sector could easily lose several hundred thousand jobs in the US. New York City expects employment in the banking and brokerage sector to fall by 150,000. Marriages like the ones between Bear Stearns and JP Morgan and Wachovia (WB) and Wells Fargo will clearly put tens of thousands of people out of jobs. Goldman Sachs apparently will let 10% of its workers go.
The trouble has spread well beyond banks. Merck, Xerox, GM, and Chrysler just said they will push more poor souls out the door. Even a successful tech company such as Hewlett-Packard has taken significant numbers of people out of its workforce.
Read More...
-
Posted
Jun 10 2009, 02:29 PM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
In early 2006, when subprime powerhouse New Century went bust, vulture investors began to salivate at the opportunities a collapsing mortgage market would offer up like manna from the trading gods. They started raising money. And lots of it.
Billions were poured into so-called "mortgage opportunity funds," which planned to pick through the wreckage of the once-high-flying housing market. Some investors aimed to focus on mortgage-backed securities, hoping to buy in at pennies on the dollar so just a few bond payments would reap sizable returns. Others, however, delved into the realm of whole loans, buying troubled mortgages from floundering banks.
As noted in the Wall Street Journal this morning, an investment strategy that seemed like a slam dunk on paper -- buying distressed mortgages on the cheap, and working out equitable arrangements with borrowers -- has proven extremely difficult to execute.
The prevailing wisdom was that, as delinquencies rose, and banks amassed a seemingly limitless portfolio of troubled loans, the likes of JP Morgan Chase (JPM), Bank of America (BAC) and Citigroup (C) would be forced to unload assets at firesale prices. Because they were buying at super-low prices, investors expected to have the necessary cushion to forgive principal, lower interest rates, or otherwise get borrowers back on track. They would, of course, earn a hefty profit for the effort.
Read More...
-
Posted
Feb 04 2009, 11:28 AM
by
Anthony Mirhaydari
Rating:
Money Blog: Top Stocks Blog - MSN Money
Throwing down the gauntlet on the villains of this downturn, President Obama has imposed a $500,000 cap on executive pay at financial institutions receiving federal bailout funds. Noting that American taxpayers are angered over "executives being rewarded for failure," he announced the limit ahead of next week's expected announcement on the future of the $700 billion financial rescue package.
Obama's move will help quell political backlash against the bailout after Wall Street paid out more than $18 billion in bonuses last year as the six largest firms mounted losses of $42 billion and received $90 billion from taxpayers. It also comes as traditional arguments for high pay (talent retention and performance encouragement) are ringing hollow in an environment rich with idled financial talent.
Still, this hasn't prevented JP Morgan (JPM) CEO Jamie Dimon from shedding crocodile tears. He said that it's "unfair to talk about us as one," referring to his bank's robust health compared to fallen competitors like Lehman Bros. and Bear Stearns. "Not every company was responsible."
Read More...
-
Posted
May 12 2009, 10:15 AM
by
Andrew Horowitz
Rating:
Money Blog: Top Stocks Blog - MSN Money
 For some time, there have been questions about the veracity and the ability for the market to sustain a prolonged rally. Questions have been asked such as: Is it real? Is it safe? Will it turn down again?
Many of the concerns were due to several meaningful components that made up the rally from the devilishly low point in March of 666, reached by the S&P 500 index. Since then, stocks have been on fire and recovered all of the 2009 losses and more. But why so many questions?
For one, volume has always been suspect. Traditionally, a market rally would start slowly and then grow as more participants believed they could put their hard earned money to work to earn a rate of return greater than money market funds or other competing assets. As the rally progresses, more investors become desirous of investing and volume begins to swell. That has not happened this time around, just as it hadn't during the past few bear-market rallies. As a matter of fact, most of the high volume days came when the markets were down. This is not a sign of a healthy market rally
Read More...
-
Posted
Apr 14 2008, 02:58 PM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
Early indications from companies like Wachovia and General Electric show that the last half of March may have been tougher on bank earnings than Wall Street expects. Bloomberg recently reported that Citigroup, JP Morgan, and Wells Fargo could all miss consensus estimates. But by how much?
A look at the spread of Q1 estimates gives some hint about how far off actual numbers could be compared with investor expectations. At Citigroup, among 15 analysts polled by First Call the average EPS estimate is a loss of $.95. But, the lowest estimate is a loss of $2.24. At JP Morgan, the average figure from fourteen analysts is $.66, but the worst case is a loss of $.11. For Wells Fargo, twenty-three analysts have an average forecast of Q1 EPS at $.57, but the low number is $.45.
The huge discrepancy among the numbers should be troubling to shareholders because recent information would argue that share prices for most banks and brokerages may still be way too high.
Read More...
-
Posted
Aug 25 2009, 08:32 AM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
This article is written by Minyanville's Justin Rohrlich
Hey buddy, can you spare a wheel of Parmigiano-Reggiano?
Italy is in the throes of its fourth recession since 2002, with the country’s economy expected to contract 5.3% this year. And, for many producers, cheese seems to be the only way out.
Credito Emiliano, an Italian bank in the Emilia-Romagna region, has been accepting parmesan cheese as collateral since the early 1950s -- and is now considering treating prosciutto, olive oil and balsamic vinegar the same way, according to Steve Jenkins, one of America’s foremost cheese experts.
Bing: Italy recession
The bank does not store the cheese on site -- this is the purview of a unit called Magazzini Generali delle Tagliate, which holds 440,000 wheels worth a little less than $190 million.
“This mechanism is our life blood,” Giuseppe Montanari, a parmesan producer, told Bloomberg News. “It’s a great way to finance our expenses at convenient rates, and the bank doesn’t risk much because they can always sell the cheese.”
Read More...
-
Posted
Jan 15 2009, 02:51 AM
by
Bernhard Warner and Matthew Yeomans
Rating:
Money Blog: Top Stocks Blog - MSN Money
This post comes from partner site The Big Money.
The cost (to us) of Bank of America's Merrill Lynch acquisition keeps on climbing. The Wall Street Journal writes that the Treasury Department is set to "give billions in additional aid" to BoA to help close the deal because of the stricken securities firm's "larger-than-expected losses in the fourth quarter." BoA got $25 billion from the Troubled Asset Relief Program back in October and its need for more money at this point illustrates a "deepening fragility among the nation’s largest banks," writes the New York Times. That's the view from Treasury anyhow. It worries that if the deal falls through it will further undermine the stability of U.S. financial markets, adds the WSJ. The fourth quarter wasn't kind to Deutsche Bank (DB), which warns that heavy trading losses will force it to take a $6.3 billion loss on the back of the global financial meltdown. Meanwhile JPMorgan's (JPM) chief executive has been looking forward and -- surprise -- 2009 looks pretty bleak.
Read More...
More Posts Next page »
|
