Archive for the ‘Economics’ Category

All this money and nothing to show for it. Are there holes in the boat we’re bailing out?

Banks in Florida, Maryland and Utah were closed yesterday as regulators wrapped up the busiest month for failures since the housing slump began in 2006.

Ocala National Bank in Florida and Suburban Federal Savings Bank of Crofton, Maryland, were shut by federal regulators, according to statements sent by the Federal Deposit Insurance Corp. MagnetBank of Salt Lake City was seized by the Utah Department of Financial Institutions. The banks had total assets of $876.4 million and deposits of $790 million.

Maybe they should have thought to require banks to report where they were spending our money before they spent it all the first time around.

The Obama administration is expected to first unveil rules for banks receiving U.S. government help, including clarifications on lending and restrictions on executive compensation, a source with knowledge of the government’s thinking said on Sunday.

Those rules are expected to be announced as early as this week and the administration’s plan to bolster the country’s banking industry is expected about a week later, the source said.

How much you bet they still won’t report it the way they should?

The consumer products maker Procter & Gamble reported Friday that its quarterly profit rose 53 percent aided by the sale of its Folgers coffee business, but warned that sales are slowing in the tough economy.

The company lowered its earning projections for the full year, and said it expected total sales to fall in the current quarter and possibly for the year.

I wonder how much they would have lost if they hadn’t sold Folgers?

Sales of newly built single-family homes fell 14.7 percent in December, the largest monthly decline since 1994, data showed on Thursday, indicating the housing market’s downward spiral was far from reaching a bottom.

The Commerce Department said sales tumbled to a 331,000 annual pace, the lowest since it started keeping records in 1963. November’s sales were sharply revised down to 388,000 annual rate, which was previously reported as 407,000.

Well duh, didn’t we all know that new home sales were going to keep falling? If people don’t have money, they can’t buy. If banks won’t lend money, they can’t buy. If politicians in Washington keep sending bailouts and offering stimulus, someone has to pay for that, until they have no money, and can’t buy. I know, it’s a vicious circle. Time for it to stop.

Who knew there were speedbumps in the old west?

Wells Fargo & Co reported a fourth-quarter loss as it added to reserves for credit losses and wrote down investments.

The company also said the former Wachovia Corp, which it bought on December 31, lost $11.17 billion in the fourth quarter, largely to boost loan loss reserves as well as investment writedowns. Before Wells Fargo outbid Citigroup Inc to take control, Wachovia nearly collapsed as losses soared from troubled mortgages.

Wells Fargo said it remains “comfortable in the aggregate” with its original assumptions on Wachovia’s credit quality, and is comfortable with its forecasts for cost savings and earnings impact.

They’re comfortable? Wow. I haven’t heard any banker types use that word in a long time.

This is bad news for Georgia, and I am not even in that count yet. These numbers are for last week. I know it’s at least 1 more this week.

Georgia’s unemployment rate in December climbed to 8.1 percent, up 80 percent in the past year to reach its highest level since 1983, the state Labor Department announced Thursday.

During the past year, the state has lost nearly 122,000 jobs.

Still looking for work.

Oh great. How long will it take to notify all the card holders involved in this one?

A New Jersey credit-card processor disclosed a data breach that analysts said may rank among the biggest ever reported.

Heartland Payment Systems Inc. said Tuesday that cyber criminals compromised its computer network, gaining access to customer information associated with the 100 million card transactions it handles each month.

The company said it couldn’t estimate how many customer records may have been improperly accessed, but said the data compromised include the information on a card’s magnetic strip — card number, expiration date and some internal bank codes — that could be used to duplicate a card.

The last time they discovered a breach somewhere I got three different debit cards in 2 months.

When the bailouts started I said it was the beginning of creating a centralized bank in America.

Two weeks after closing its purchase of Merrill Lynch at the urging of U.S. regulators, the government cemented a deal at midnight Thursday to supply Bank of America with a fresh $20 billion capital injection and absorb as much as $98.2 billion in losses on toxic assets, according to people involved in the transaction.

…

The second lifeline brings the government’s total stake in Bank of America to $45 billion and makes it the bank’s largest shareholder, with a stake of about 6 percent.

It seems we’re almost there. Bank Of America will soon be The Bank Of America.

Thank you. May I have another?

Bank of America Corp., the biggest U.S. bank by assets, may get more aid from the government to help absorb losses tied to this month’s acquisition of Merrill Lynch & Co., three people familiar with the matter said.

Details are likely to be disclosed on Jan. 20, the people said. That’s when Bank of America may post its first quarterly loss in 17 years as it digests the purchases of Merrill Lynch and Countrywide Financial Corp. The combined company has already received $25 billion from the U.S.

When will this madness end? Haven’t we learned our lesson yet?

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?