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Posted
Apr 10 2009, 01:13 PM
by
Karen Datko
Rating:
Money Blog: Smart Spending Blog - MSN Money
This post comes from Truman Lewis at partner site ConsumerAffairs.com.
As Congress mulls new restrictions on credit card issuers, Bank of America is raising interest rates on millions of its customers who routinely carry a balance on their credit cards, a move already taken by most other larger issuers but not one that goes down well with consumers.
Basically, BofA and other banks are penalizing customers who don't pay off their bills each month. It's a reversal of banks' usual practice. During normal economic times, bankers loathe customers who pay their balance each month, because by so doing they deprive the bank of the interest it would have earned on the unpaid balance.
But now, with banks hoarding every cent, the worm has turned.
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Posted
Mar 20 2008, 02:30 PM
by
Karen Datko
Rating:
Money Blog: Smart Spending Blog - MSN Money
Melissa at A Penny Closer used to be skeptical about all of the gloom-and-doom talk about the economy. No longer. Now she's having a very difficult time staying within her $75-a-week food budget, even though she's buying less meat. "In the past I could shrug off the pessimism," she writes, "but now it's hit home in a new way and I'm a little nervous." Even pet food costs more. The sale price for the same can of cat food at her local store went from 33 cents to 44 cents in two weeks. What is her plan to cope? No more monthly $50 donations to the "fun money" savings account, even fewer meat-based meals, and more soup-and-sandwich dinners are among her strategies.
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Posted
Mar 25 2009, 12:17 PM
by
Anthony Mirhaydari
Rating:
Money Blog: Top Stocks Blog - MSN Money
Both China and Russia are calling for the creation of a new "synthetic" reserve currency to replace the U.S. dollar. With global policymakers looking to make big changes heading into the G20 meeting in London next week, America's monetary dominance is being challenged.
The Chinese central bankers are upset since they got burned after diversifying into U.S. stocks at the worst possible time. They are also worried about inflation. Last week the Federal Reserve announced it would start buying $300 billion worth of long-term Treasury bonds to try and stimulate the economy. The action fell under the auspices of "quantitative easing", the monetary policy tool being used in Japan, the U.K., and Switzerland. Such a direct financing of government eventually becomes inflationary. As a result, currency traders have been pushing the dollar down hard.
Since controlling the printing presses to the world's reserve currency is highly desirable, President Obama shrugged off the proposal. But then Treasury Secretary Tim Geithner told an audience Wednesday that "we're actually quite open" to the idea as a way of helping the global economy out of recession before quickly noting that a strong dollar remains in America's interest. What should we believe?
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Posted
Nov 20 2008, 01:20 PM
by
Karen Datko
Rating:
Money Blog: Smart Spending Blog - MSN Money
Florida homebuilder and entrepreneur Earl Snyder is ready for what he imagines to be a growing consumer demand. He designed the Midnight Gardener, a PVC container that keeps money clean and dry once it's in the ground. Yes, it's come to that for some overanxious folks. A story at SmartMoney by Anne Kadet presents anecdotal evidence that people leery of bank failure and economic collapse are borrowing from Great Depression lore and burying money in the backyard. Please note: We do not recommend this behavior. The money you have in the bank is safe.
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Posted
Nov 07 2008, 05:43 PM
by
Karen Datko
Rating:
Money Blog: Smart Spending Blog - MSN Money
Not only is the economy taking a toll on marriages, but it's also affecting how people are timing their divorce. To explain, we present this possible scenario: His financial woes have strained the marriage of Mr. and Mrs. Investment Banker. She wants a divorce settlement right now based on his earnings history. His attorney advises him to wait until next year, when his tax return will prove he isn't worth nearly as much. Such strategies "only come to the forefront during hard times," New York divorce lawyer Mitchell Devack told The New York Times.
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Posted
Jul 07 2008, 12:34 AM
by
Donna Freedman
Rating:
Money Blog: Smart Spending Blog - MSN Money
It can take years for a big Hollywood movie to get approved, let alone filmed. That's why I think that the parallels between "Kit Kittredge: An American Girl" and our current economic situation are probably coincidental.
Foreclosures. Job loss. Hungry people lining up for food handouts. Families who can't make ends meet no matter how hard they work. But enough about today; let's talk about the Great Depression, the setting for "Kit Kittredge."
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Posted
Sep 16 2009, 04:03 AM
by
Douglas McIntyre
Rating:
Money Blog: Top Stocks Blog - MSN Money
 The global airline industry, still staggering from huge losses and bankruptcies late last year after oil prices passed $140 a barrel, is not doing much better in 2009. Low passenger traffic is the chief culprit, but crude at $70 after a sharp dip early in the year puts on significant additional pressure.
The International Air Transport Association (IATA) released its new forecast for worldwide airline losses this year and it moved up $2 billion to $11 billion. “The bottom line of this crisis – with combined 2008-9 losses at $27.8 billion – is larger than the impact of 9/11,” said Giovanni Bisignani, IATA’s Director General and CEO.
The industry is so heavily burdened with debt that weak demand during the upcoming holiday season will threaten to sink some carriers. Japan Air has already announced nearly 7,000 layoffs and the Asia carrier is looking for a cash infusion from AirFrance-KLM or a major US carrier–perhaps American Airlines.
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Posted
May 19 2009, 07:59 AM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
Monday, State Street (STT) announced that it would be consolidating approximately $22.7 billion of off-balance sheet assets, taking a $3.7 billion charge in the process -- effectively converting an unrealized off-balance sheet loss on the portfolio to one realized on balance sheet.
Between the increase in assets and the charge, State Street’s Tangible Common Equity ratio would have fallen from 5.9% to 2.2%. So, from my perspective, notwithstanding a clean bill of health from the stress test regulators (pro forma Tier-1 Common was still a robust 9.0%) I think State Street did the right thing Monday by raising common equity – and per their press release on a pro forma basis, once the stock offering is complete, the bank’s TCE ratio will be 3.4%.
But did State Street really do the right thing?
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Posted
Jul 15 2009, 11:56 AM
by
Catherine Holahan
Rating:
Money Blog: Top Stocks Blog - MSN Money
 As strapped consumers look for ways to save, they are increasingly turning to generic products. Savvy investors still have time to add generic manufacturers to their portfolios and profit from the downturn.
The desire for generics over name-brand drugs was evident in recent earnings reports from pharmaceutical giants and consumer products companies. This week, Johnson & Johnson, which manufactures products as varies as Neutrogena skin care products and brand name birth control pills, said sales dropped 7.4% in second quarter to $15.2 billion. Company executives attributed the decline largely to competition from generic drug makers, who sell alternatives to J&J's leading drugs, such as anti-psychotic Risperdal.
"Our pharmaceutical business saw the continued impact of generic competition," said Dominic Caruso, J&J's chief financial officer, during the company's July 14 earnings call.
Generic drugs had a similarly negative impact on Abbott Laboratories. The Chicago-based drug-maker said today that its prescription drugs sales fell 4.3% to $3.95 billion due in part to generic competition for anti-depressant Depakote.
Meanwhile, smaller generic drug developers saw their sales soar this quarter. Hi-Tech Pharmacal, a generic drug manufacturer based in Amityville, N.Y., said July 14 that its sales rose 82% in the most recent quarter to $38.3 million. The surge was primarily due to sales of generic drugs, such as its Dorzolamide anti-glaucoma treatment. The company's profits increased 18 times, from $277,000 to $5.1 million.
Investors interested in profiting from consumers trading to generics will want to take a look at Teva Pharmaceutical Industries and Mylan Labs.
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Posted
Apr 14 2009, 11:51 AM
by
Karen Datko
Rating:
Money Blog: Smart Spending Blog - MSN Money
Madison at My Dollar Plan launched an ethical debate. She and her husband qualify on paper for a mortgage modification through the Making Homes Affordable program -- but they don't really need it.
Is it OK to take advantage of a program intended to help struggling homeowners when you can easily afford your monthly payment?
That's one of several questions about ethical personal-finance behavior that have surfaced online recently. Age-old dilemmas have been cloaked in modern terms. Here are a few that PF bloggers have addressed:
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