Archive for the ‘Financial News’ Category

As I have said before, you need to pay attention to what the media is reporting.

Clothing chain Gap Inc. reported an 8.3 percent decline in fourth-quarter profit Thursday, but the results beat Wall Street’s forecasts because of the company’s focus on controlling expenses, including inventory.

The San Francisco-based retailer said it earned $243 million, or 34 cents per share, for the three months ended Jan. 31. That compared with $265 million, or 35 cents per share, in the year-ago period.

Sales for the quarter fell almost 13 percent to $4.08 billion from the year-ago’s $4.67 billion.

Profit is down, not gone. Sales fell, but didn’t stop. Gap, Inc. still made a boatload of money. They still made a profit. They just didn’t make as much as they wanted to.

You know, if XM and Sirius would have learned to treat their customers a bit better, they probably wouldn’t be in this mess. Just sayin’…

Shares of Sirius XM Radio Inc (SIRI.O) fell 28 percent on a report about the satellite radio provider’s ability to meet its looming debt payments and the possibility that it might seek bankruptcy protection.

They settled. There’s something unsettling about allowing a company to settle rather than admit guilt. Then again, by settling they admitted they did something, right?

Countrywide Financial Corp has agreed to provide about $7.7 million to settle allegations by Colorado that it improperly marketed subprime and other high-risk mortgages in the state.

Colorado had accused Countrywide of deceptively putting borrowers into high-risk, high-cost loans that quickly became unaffordable once low introductory rates expired and monthly payments increased dramatically.

I wonder how this came about? Were they sitting around thinking of ideas where someone suddenly thought, “wow, maybe we should help people this time”?

U.S. Treasury chief Timothy Geithner said on Saturday that banks getting public aid under a new rescue plan must help struggling homeowners by reworking their mortgages, according to Democratic sources.

Geithner on Monday will outline the Obama administration’s plan of attack on a virulent credit crisis and proposals for spending what remains in a $700 billion financial bailout fund approved by Congress in October.

“Spending what remains”. The have no idea what remains, do they?

Bad news on the oil front…

BP Plc (BP.L) missed analysts’ forecasts with a 24 percent drop in fourth-quarter replacement cost net profit to $2.59 billion, due to a collapse in oil prices and a big loss at its Russian unit.

Chief Executive Tony Hayward said the oil major was responding to weaker crude prices by intensifying his efforts to cut costs and jobs, echoing similar comments rival Royal Dutch Shell Plc (RDSa.L) made to staff last week.

That’s right. BP only made $2.59 billion in profits. What are they going to do now? They’re destitute.

The good news? Existing home sales rose.

The bad news? Existing home values suck.

The pace of sales of existing homes in the U.S. rose 6.5 percent in December, but the median home price dropped by a record 15.3 percent compared to the same period the year earlier, a National Association of Realtors report showed on Monday.

I wonder how much of the sales were related to foreclosure sales? Do those figure into these numbers?

After hearing President Obama’s speech, I guess the bankers realized things weren’t as hopeful as they thought.

Wall Street ushered in the Barack Obama presidency with a record Inauguration Day drop on Tuesday amid fresh signs the global bank crisis was far from over.

High expectations for details on how the new administration would address the growing banking crisis and faltering economy were dampened after the inauguration speech concluded with little new information to digest.

If they thought things were tough before, wait until they get that change he spoke about on the campaign trail.

It appears that Circuit City was unable to find a sucker someone to buy their remaining assets.

Circuit City Stores Inc. says it has reached an agreement with liquidators to sell the merchandise in its 567 U.S. stores after failing to find a buyer or a refinancing deal.

The second-biggest electronics retailer in the nation says in court papers it has appointed Great American Group LLC, Hudson Capital Partners LLC, SB Capital Group LLC and Tiger Capital Group LLC as liquidators.

Too bad our local store already closed, I might have been able to get a good deal there.

Will JPMorgan need help too?

JPMorgan Chase & Co’s fourth-quarter profit plunged 76 percent as it wrote down bad loans, signaling that even the bank that has avoided the worst of the credit crunch is struggling with the recession.

The bank turned a profit only because of special items; and after Moody’s Investors Service cut the bank’s debt rating one notch to AA3, its shares dropped as much as 4.5 percent before recovering.

I wouldn’t be surprised if they show up at the White House door with their own little tin cup.

Is this a sign that things are much worse than we thought?

Goody’s LLC, a privately held family apparel retailer that emerged from bankruptcy in October, has filed for Chapter 11 protection again, and said it plans to liquidate its remaining 282 stores.

A “significant downturn in the national economy caused severe and unexpected financial pressures,” and led to “unexpectedly poor” sales in the holiday season, Goody’s said in a Tuesday filing with the U.S. bankruptcy court in Wilmington, Delaware.

Several retailers have filed for bankruptcy protection in recent months, including Boscov’s Inc, Circuit City Stores Inc (CCTYQ.PK) and KB Toys Inc.

I don’t think so. It probably means that the company was weak after emerging from bankruptcy in October and probably should have closed then.