Archive for January, 2009

The national jobless rate is 7.2%? Ouch.

An early relief rally following the news that payrolls in the world’s largest economy declined by a smaller than anticipated 524,000 in December soon dissipated as investors focused on the rise in the unemployment rate to a 16-year high of 7.2 percent from 6.8 percent in the previous month. Analysts had expected unemployment to hit 7 percent in December.

Is this really news?

Government efforts to prop up U.S. banks and savings institutions have only partly cushioned the blow from what may have been the industry’s worst three-month period since 1990.

“Credit trends are going to be bad,” said Gary Townsend, co-founder of Hill-Townsend Capital in Chevy Chase, Maryland. “No one is immune. If you are a bank, and have loans, you will suffer your share.”

The banks are already hurting because of the mortgage fiasco. Why wouldn’t they hurt more when the recession causes more people to get later with their bills?

Does this mean Morgan Stanley will need a bailout? Do we, the taxpayers, get a refund or a return on our investment with the proceeds from the transaction?

Citigroup Inc is in advanced talks to sell its Smith Barney brokerage unit to Morgan Stanley, a person familiar with the matter said on Friday, in a move that would further dismantle the financial supermarket that has been bailed out by the U.S. government.

Maybe we’ll need to give them more money to help complete the sale?

Verizon is clever. When buyouts like this occur, people worry about their jobs. They wonder if they will lose their job because their position will no longer be needed. It’s rather nice of Verizon to give all of their non-executive employees a one-year notice.

Verizon Wireless said Friday it has completed its $5.9 billion purchase of Little Rock, Ark.-based Alltel Corp., making Verizon the nation’s largest mobile phone company.

Verizon said Friday it will also take on $22.2 billion in Alltel debt.

Basking Ridge, N.J.-based Verizon says it will retain all Alltel employees below the executive level as the company assesses which positions need to be cut or kept under the new arrangement. When Verizon President and Chief Executive Lowell McAdam addressed an audience in Little Rock in August, he said it would take a year after closing the sale to assess employee retention.

At least they don’t have to worry for a while, right?

If you’re going to do something, you should just do it, but not lie about it. Home Depot says their decision “wasn’t based on the economy”, and they were just looking for new ways to reach out to customers and staffers. Sure they were. Nothing says reaching out in new ways than cutting your sponsorship of the Olympics.

After 16 years as an Olympic sponsor, Home Depot is hanging up its rings.

On Wednesday, the world’s largest home improvement retailer informed 98 employees in its Olympic jobs program that it is ending its sponsorship of the Olympics and Paralympics.

The innovative jobs program had allowed Olympic athletes to work part-time at the Home Depot while enjoying full-time pay and benefits, giving them time to train.

Three Georgia athletes will be affected. They live in Morrow, Savannah and Athens, said Home Depot spokeswoman Jean Niemi, who couldn’t immediately provide their names.

Over the course of the retailer’s 16-year sponsorship, more than 660 athletes participated in the jobs program; 300 Home Depot athletes made Olympic and Paralympic teams; and they brought home nearly 150 medals, 95 of them gold.

It’s a proven fact. Bailouts do not save jobs.

Wells Fargo & Co (WFC.N) Chief Executive Officer John Stumpf, whose company acquired Wachovia Corp, said on Wednesday that minimizing job losses will be a priority but added that some cuts would begin this year.

Stumpf told the Charlotte Observer newspaper that he does not know how many jobs will be lost in the merger and did not provide a specific timeframe for the start of layoffs.

Of course, the government wasn’t thinking about jobs when they started handing out money, so I guess this is a non-issue right?

I’m sorry, but should we be feeling something after reading this?

Kenneth Lewis, Chief Executive of Bank of America Corp (BAC.N), has recommended to his board of directors that he not receive a bonus for 2008, news reports said on Tuesday.

Lewis is among the many Wall Street chief executives that are not receiving bonuses amid heavy losses for the industry, share price plunges and government rescues.

So what does this mean? I’m pretty sure he didn’t pass on the bonus for the sake of the company. In fact, my bet it was 100% for public image.

For months we have known that sales were down. How could we forget? The automakers have been crying for a bailout. So…

U.S. auto sales plunged by 36 percent in December led by outsized declines at Chrysler LLC, Hyundai Motor (005380.KS) and Toyota Motor Corp(7203.T) as the battered industry closed out its weakest year since 1992 in its largest single market.

Chrysler’s sales dropped by 53 percent in December, a month when the automaker and larger rival General Motors Corp (GM.N) fought to clinch a $17.4 billion bailout from the U.S. government.

Meanwhile, Toyota, the global industry leader, posted a sales drop of 37 percent for the month, its worst U.S. sales decline since at least 1980.

Why is this news? Didn’t we already know it was going to be this bad?

Two down, one to go.

Chrysler LLC on Friday received an initial $4 billion emergency loan from the U.S. government, two days after the government completed a parallel payout to its larger rival General Motors Corp.

“This initial loan will allow the company to continue an orderly restructuring,” Chrysler Chief Executive Bob Nardelli said in a statement.

U.S. Treasury Department spokeswoman Brookly McLaughlin confirmed that the government had sent the $4 billion in funds to Chrysler on Friday.

How long do you think it will be until Ford changes their mind and needs a bailout too?

Is this a sign that Microsoft didn’t do as well as they thought they were going to this past year?

Rumors about substantial cutbacks at Microsoft have been circulating for at least two months, but have not been confirmed by credible sources. The rumors were reignited by Fudzilla, which claims that the axe will fall on January 15 and affect about 15,000 employees.

Such a cutback would translate into a 17% reduction Microsoft’s global workforce of 90,000 people. Fudzilla’s sources indicate that MSN will take the brunt of the layoffs and the company’s EMEA region will be hit harder than any other geography.

Maybe promoting a crappy operating system and web browser had something to do with it?