Archive for December, 2008

Finally. Isn’t nice that someone, somewhere is finally sharing your money with your fellow taxpayers?

Jamie Dimon, chief executive officer of JPMorgan Chase & Co., said the bank is using its $25 billion capital infusion from the U.S. government to increase lending in businesses including credit cards and student loans.

JPMorgan also boosted the overnight loans it makes to other banks to $60 billion from roughly $5 billion before Lehman Brothers Holdings Inc. filed for bankruptcy protection in September, Dimon said today in an interview on CNBC.

Isn’t it nice to see what your money can do for other people? Just wait though, if Congress gets their way, you won’t just own investment firms, banks, and houses. You;ll be the proud investor in our nation’s failed automotive industry.

I’m sure many people will attribute these closings to the “state of the economy”, but in reality, shouldn’t these companies be closing underperforming stores or doing something else to increase sales from them?

Office Depot on Wednesday said it will close 112 underperforming retail stores in North America during the next three months.

The announcement said the closures would occur in various geographic regions, including 45 in the central U.S., 40 in the Northeast and Canada, 19 in the West and eight in the South. Fourteen more stores would be closed through 2009 as leases expire or other lease arrangements are finalized.

It’s just common sense to be doing that anyway, why should the current state of the economy have anything to do with it?

Just what we need. In addition to having an ownership in banks, investment firms and millions of homes, it looks like we’re going to own a few auto manufacturers as well.

Congress and the White House inched toward a financial rescue of the Big Three auto makers, negotiating legislation that would give the U.S. government a substantial ownership stake in the industry and a central role in its restructuring.

I don’t know about you, but things are looking a bit socialist to me.

As I have suspected all along, the ‘bailout’ for automakers is much more than that. It’s an opportunity for Senator Dodd and others who think like him to micro-manage the auto industry to fit their agenda.

Senate Banking Committee Chairman Chris Dodd said General Motors Corp. Chief Executive Richard Wagoner should be replaced as a condition for federal aid and Chrysler LLC may have to merge to survive.

…

Dodd said that GM is in the “worst shape.”

“Chrysler, is, I think, basically gone, probably ought to be merged,” Dodd said. Ford Motor Co. is the healthiest domestic automaker, he said.

Chrysler spokeswoman Lori McTavish said it would be “inappropriate for the company to comment on the speculation.”

Thanks but no thanks. I like my marketplace run by the private sector and fed by consumers. Once the government starts controlling it all, it’s not really capitalism anymore, is it?

I was shocked to find out that Apple has locked up 30% market share. I knew they would have a huge increase this year, but 30%? Wow.

The Apple iPhone now has a 30 percent market share in the U.S. smartphone market and 16.6 percent of the worldwide smartphone market, Needham analyst Charlie Wolf wrote in a research note this week. Apple is now second only to Nokia, which, while still very strong, saw its share plummet from 63.3 to 43.6 percent year over year. Most of that loss went directly to Apple.

It really isn’t surprising that they have climbed so rapidly though, the hype about the iPhone was stronger than for any other product that I can think of (other than Tickle Me Elmo). Combine that hype with Apple’s excellent reputation and you have a surefire success on your hands.

Wal-Mart, and AT&T, are doing nothing to squash this rumor.

Answering an inquiry from BetaNews about Wal-Mart’s reputed plans to sell an iPhone 3G for $99, a spokesperson today issued a statement that neither confirms nor denies the rumors.

“We have made no official announcement on offering the iPhone at Wal-Mart,” said spokesperson Kelly Cheeseman today, when asked by BetaNews for comment on published reports that the retail chain will start selling a 4 GB version of Apple’s iPhone 3G for $99 just before New Year’s Day.

What do you think? Could it be true? Are $99 iPhones coming to your neighborhood Wal-Mart?

First we hear that Wal-Mart may be selling the iPhone for $99, then we hear that AT&T is cutting jobs.

AT&T Inc. on Thursday said it would cut 12,000 jobs, or 4% of its workforce, and spend less on new equipment in 2009 in response to a weakening economy.

The Dallas-based phone giant, which had 303,000 employees at the end of the third quarter, becomes the latest corporate bellwether to announce major layoffs. Also on Thursday, DuPont, Viacom and Credit Suisse said they would cull jobs.

If Wal-Mart carries the iPhone for $99, AT&T might need some of those people.

Haven’t we all known for years that bank overdraft fees are unfair to consumers?

Overdraft fees are boosting banks’ profits at the expense of consumers, especially young and low-income people, finds a new Federal Deposit Insurance Corp. study.

The 18-month survey found that most banks automatically enroll consumers in overdraft programs — some don’t allow them to opt out — and then cover overdrawn transactions for a per-item fee of up to $38.

So what will come of this survey? Yeah, I figure silence and inaction.

The following summary made me raise an eyebrow. I thought for sure this meant that the federal government (aka the American taxpayer) was off the hook for a lot of the AIG risk.

A financing entity purchases $46.1B in troubled AIG debt securities, ending insurer’s need to post additional collateral. AIG still looking to buy another $18.6B.

That feeling was shortlived however when I learned that the “financing entity” consisted of none other than the Federal Reserve Bank of New York and AIG itself.

The sick to my stomach feeling returned as I read on,

In addition to this financing entity, the restructured bailout calls for the government to: buy $40 billion in preferred stock in AIG; lend the company $60 billion over five years; purchase up to $20.9 billion of AIG’s short-term debt, called commercial paper, and fund a second financing entity with $22.5 billion to purchase residential mortgage-backed securities AIG had invested in in its securities lending business.

Add those numbers up. I’ll wait. So how much did you think we were giving AIG? $143.4 billion is a lot more than you thought isn’t it? Don’t worry though, it’s only $469.27 for every man, woman, and child in the United States.

Of course, that doesn’t include the $700 billion bailout, or the nearly $7 trillion the government is already spending to “bailout” everyone under the sun, except you.

Do these people think they are actually going to see any money from “Countrywide” ever again?

Countrywide Financial Corp., the home lender acquired by Bank of America Corp., was sued by Greenwich Financial Services Fund over claims an agreement to reduce payments on mortgages by $8.4 billion would hurt investors.

The hedge fund claims investors will be harmed by Bank of America’s settlement, reached on behalf of Countrywide, with 15 state attorneys general. The value of trusts that bought 400,000 mortgages will decline under the deal, the fund said.

In the proposed class action, or group lawsuit, the Greenwich, Connecticut-based fund demands a declaration that “Countrywide must purchase at par every mortgage loan that it sold to any of the 374 securitization trusts,” David Grais, a lawyer for the fund said today in an e-mailed statement. Grais said Countrywide could owe $80 billion to the trusts.

They ‘want’ Countrywide to purchase every mortgage loan that might affect any of the 374 securitization trusts. Good luck with that. Even if Greenwich Financial Services Fund is successful in their suit, it’s you and I that will be paying that $80 billion. The government will just add that to the bailout totals, I am sure.

We are so screwed.