David Sokol has been the primary guy in the running, and Warren Buffett's top pick, to replace the Oracle of Omaha as the CEO of Berkshire Hathaway. Well David is no longer available for the position.
Just ask him.
David Sokol recently withdrew himself and resigned from the expected job and responsibility of running what is perhaps the most successful holdings company ever to invest.
He has allegedly stepped down after information about some personal trades of a company he purchased stock in which has recently been bought by Berkshire Hathaway.
Buffett has said that the decision does not come as a derivative of that trade nor the surfacing of that news.
I my self have to wonder a bit as the media is hitting this thing pretty hard. But I have enough confidence in Buffett to take his word... for the most part.
So now the real question is this...
Who will hop in the driver seat now that David Sokol is out?
It is a big question that needs answering. Warren who is still in relatively good health is 80 years old. He is not senile yet and still seems to navigate his way around a prospectus and balance sheet pretty well but hey... he is old.
They say there are four internal potential candidates that are already being considered.
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Showing posts with label financial news. Show all posts
Showing posts with label financial news. Show all posts
Thursday, March 31, 2011
Friday, January 28, 2011
The US Economy Fires Up to End 2010
The GDP growth rose considerably to a annual rate of 3.2% up from the previous 2.6%
The market seems to be doing pretty well and those GDP numbers are pretty solid. Just the same I have some worries.
Housing is not looking any better and I think it is or at least could get a little worst. That scares me a bit. I think we are going to see a lot of foreclosures in the future and a lot of banks are going be taking on properties that they can not sell and I think that will be most of them.
Homeowners of course will do their best to stop foreclosure through a mortgage solution such as loan modification or even refinancing. But many will not be able to afford their mortgage payment or rather the home.
I suppose only time will tell. I would just hate to see things take a turn for the worst as I am not sure the economy has what it takes to pull itself back up from a double dip.
The market seems to be doing pretty well and those GDP numbers are pretty solid. Just the same I have some worries.
Housing is not looking any better and I think it is or at least could get a little worst. That scares me a bit. I think we are going to see a lot of foreclosures in the future and a lot of banks are going be taking on properties that they can not sell and I think that will be most of them.
Homeowners of course will do their best to stop foreclosure through a mortgage solution such as loan modification or even refinancing. But many will not be able to afford their mortgage payment or rather the home.
I suppose only time will tell. I would just hate to see things take a turn for the worst as I am not sure the economy has what it takes to pull itself back up from a double dip.
Wednesday, December 1, 2010
Cash, Credit, or Cell?
"Hey can you cover me I left my charger at work?"
This is how you will sucker your friend in to paying for your night out in a year or two.
Confused?
Yeah... you, Master Card, Visa, and American Express too.
In just a few short months consumers will have the option to pay with cash, credit card, or their smart phone.
That's right soon your smart phone will be just like a credit card except better; it won't be a credit card.
Who Is Behind This New Payment Method?
More then several players are going to be directly offering a cell phone payment method.
Below is a quick list of the bigger companies creating an alternative credit method for your smart phone.
Isis
AT&T, Verizon, and T-Mobile are all joining forces to form a company or entity or whatever they are call such a partnership. This new transaction processing company will be called Isis.
Google and the Android Operating System
Google is developing a system that will integrate with their Android operating system. All a phone will need is the embedded chip.
New Start-Ups
There are several new companies that have already formed that are going to offer solutions for both consumers and merchants as an alternative to paying with the old credit card.
Why the Push to Create a New Payment Method and Credit Card Alternative?
Mobile Networks
This is the obvious answer. All the big data networks such as AT&T, Verizon, and T-Mobile will expand their offered services in a big way. The electronic transaction solution business is one hell of an extra business to get in to. They will get a cut of every transaction just like the credit card companies do now.
Consumer Choice
Then of course there is the consumer demand for an alternative to credit cads. there is an obvious benefit to being able to pay with your smart phone in addition to the other two choices that we already have. though this is an obvious motive for coming up with another merchant transaction solution and alternative to credit cards it is not even close to the main driver of this new industry.
Merchant Incentive - A Cheaper Better and Smarter Alternative
Merchants are going to welcome this thing with open arms. Merchants have a real love hate relationship with credit cards. The problem that merchants have with the existing credit card transaction solutions is the price they are charged by the credit card companies. It really puts a dent into the margins.
Also the credit card companies have been increasing rates on the merchants to make up losses that the banks have incurred during the credit crunch and massive waves of loan defaults.
To top it off the credit card companies have made it a breach of contract for merchants to say anything about the expense to consumers.
In fact many people have no idea how credit card companies make money. It's not the interest we all pay.
Merchants will be able to cut the transaction expense in half. This means bigger gains in margin. This thing will be huge for merchants.
Credit Card Companies are in Trouble
The one thing that is crystal clear amidst all this new possibility and choice that consumers, networks, and merchants will have in the very near future is that credit card companies are not going to fair well.
Sure there is going be a place for credit cards. Trust me when I tell you that credit cards are not going anywhere. I am actually surprised that the bigger credit cad companies are not more involved with this new movement but the again I guess these phone networks have a pretty solid infrastructure already in place.
My next post is going to be on what this will mean for consumers and merchants as well as the data networks. The positive impact and benefits of ths shift is going to be a lot bigger then most people would think and I really want to paint a vivid picture for everyone.
So check back soon!
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This is how you will sucker your friend in to paying for your night out in a year or two.
Confused?
Yeah... you, Master Card, Visa, and American Express too.
In just a few short months consumers will have the option to pay with cash, credit card, or their smart phone.
That's right soon your smart phone will be just like a credit card except better; it won't be a credit card.
Who Is Behind This New Payment Method?
More then several players are going to be directly offering a cell phone payment method.
Below is a quick list of the bigger companies creating an alternative credit method for your smart phone.
Isis
AT&T, Verizon, and T-Mobile are all joining forces to form a company or entity or whatever they are call such a partnership. This new transaction processing company will be called Isis.
Google and the Android Operating System
Google is developing a system that will integrate with their Android operating system. All a phone will need is the embedded chip.
New Start-Ups
There are several new companies that have already formed that are going to offer solutions for both consumers and merchants as an alternative to paying with the old credit card.
Why the Push to Create a New Payment Method and Credit Card Alternative?
Mobile Networks
This is the obvious answer. All the big data networks such as AT&T, Verizon, and T-Mobile will expand their offered services in a big way. The electronic transaction solution business is one hell of an extra business to get in to. They will get a cut of every transaction just like the credit card companies do now.
Consumer Choice
Then of course there is the consumer demand for an alternative to credit cads. there is an obvious benefit to being able to pay with your smart phone in addition to the other two choices that we already have. though this is an obvious motive for coming up with another merchant transaction solution and alternative to credit cards it is not even close to the main driver of this new industry.
Merchant Incentive - A Cheaper Better and Smarter Alternative
Merchants are going to welcome this thing with open arms. Merchants have a real love hate relationship with credit cards. The problem that merchants have with the existing credit card transaction solutions is the price they are charged by the credit card companies. It really puts a dent into the margins.
Also the credit card companies have been increasing rates on the merchants to make up losses that the banks have incurred during the credit crunch and massive waves of loan defaults.
To top it off the credit card companies have made it a breach of contract for merchants to say anything about the expense to consumers.
In fact many people have no idea how credit card companies make money. It's not the interest we all pay.
Merchants will be able to cut the transaction expense in half. This means bigger gains in margin. This thing will be huge for merchants.
Credit Card Companies are in Trouble
The one thing that is crystal clear amidst all this new possibility and choice that consumers, networks, and merchants will have in the very near future is that credit card companies are not going to fair well.
Sure there is going be a place for credit cards. Trust me when I tell you that credit cards are not going anywhere. I am actually surprised that the bigger credit cad companies are not more involved with this new movement but the again I guess these phone networks have a pretty solid infrastructure already in place.
My next post is going to be on what this will mean for consumers and merchants as well as the data networks. The positive impact and benefits of ths shift is going to be a lot bigger then most people would think and I really want to paint a vivid picture for everyone.
So check back soon!
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US Unemployment Checks - Two Million Say Good Bye
Today two million unemployed Americans say goodbye to their unemployment checks.
I have never been good at saying goodbye. For the purposes of this post that really does not matter.
I have never received unemployment benefits. So I will not be one of the two million US citizens who will have to say goodbye to their unemployment checks today.
These folks have been collecting free money from the US Government for at least 99 weeks. That is about two years for all you math gurus.
Many democrats are disappointed. They wanted to extend unemployment further. They felt that we should keep on paying folks who have been out of work for two years.
hmmmm...
Personally I think that logic is nuts. I think two years is nuts. I think our policy makers must be ignorant to the fact that a HUGE portion of the folks who collect unemployment are milking the system for a free ride. I know I was clueless until about 4 or 5 years ago when I I was of the age and maturity to have friends and acquaintances who were unemployed.
I must confess that I do not know a whole lot of folks who make less than 40,000 especially if you don't include those whom are students.
Just the same I have estimated that I know of about 8-12 people on unemployment. Nine of those folks (in my humble opinion) are working the system over. They are not working because they are getting paid not to work. Many of them would look at you stupid if you asked why they don't want to go get a job while they are collecting unemployment. Maybe they are right.
Life is all about incentive and very little else if anything else.
So why is it that someone whom collects a pay check whether they clock in for 8 hours doing something they would most likely rather not do or if they do as they would if on an extended weekend.
I am not sure one can argue with that logic.
There is pride... but that is "hit" once your on unemployment, so why not milk it.
There is principle... but those folks never apply for unemployment.
Frankly, I think anything over two or three months of "free money" is plenty. Sure maybe in many situations those folks should still get some sort of aid from their government. But the shape and form of that assistance should not be a blind check week after week.
If nothing else we should at least put them to work and get some kind of value for the tax payers buck.
I would not be surprised if some of you are growling as you read this post. but let's just take a second and step back.
Every week 2,000,000 checks go out. These checks are going to folks who under normal conditions would have been dropped from unemployment due to the normal expiration of a citizens right to unemployment. However we extended them. So these people whom have already maxed out the system were given an additional 100 pay checks. The working man paid for an additional two million salaries every week for two years. Don't forget these are just the folks whom were extended the extra 99 week duration. By this I am implying that there are way more then two million collecting unemployment.
Given the above considerations, if we do the math at just a 100 dollars a week then we come up with about 20 billion dollars. That is about the amount that all online advertisers spend over 3 to 5 months total. That accounts for at least a decade of porn revenue. Now our figure we just calculated is wrong. People get more then 100 a week.
I don't want to take part in a more realistic calculation. It is to scary.
So... as I stated earlier, two million unemployed Americans will have to say good bye to their unemployment checks.
GOOD!
How much you want to bet we see a spike in employment numbers with in 25 - 35 days.
I am calling it.
I have never been good at saying goodbye. For the purposes of this post that really does not matter.
I have never received unemployment benefits. So I will not be one of the two million US citizens who will have to say goodbye to their unemployment checks today.
These folks have been collecting free money from the US Government for at least 99 weeks. That is about two years for all you math gurus.
Many democrats are disappointed. They wanted to extend unemployment further. They felt that we should keep on paying folks who have been out of work for two years.
hmmmm...
Personally I think that logic is nuts. I think two years is nuts. I think our policy makers must be ignorant to the fact that a HUGE portion of the folks who collect unemployment are milking the system for a free ride. I know I was clueless until about 4 or 5 years ago when I I was of the age and maturity to have friends and acquaintances who were unemployed.
I must confess that I do not know a whole lot of folks who make less than 40,000 especially if you don't include those whom are students.
Just the same I have estimated that I know of about 8-12 people on unemployment. Nine of those folks (in my humble opinion) are working the system over. They are not working because they are getting paid not to work. Many of them would look at you stupid if you asked why they don't want to go get a job while they are collecting unemployment. Maybe they are right.
Life is all about incentive and very little else if anything else.
So why is it that someone whom collects a pay check whether they clock in for 8 hours doing something they would most likely rather not do or if they do as they would if on an extended weekend.
I am not sure one can argue with that logic.
There is pride... but that is "hit" once your on unemployment, so why not milk it.
There is principle... but those folks never apply for unemployment.
Frankly, I think anything over two or three months of "free money" is plenty. Sure maybe in many situations those folks should still get some sort of aid from their government. But the shape and form of that assistance should not be a blind check week after week.
If nothing else we should at least put them to work and get some kind of value for the tax payers buck.
I would not be surprised if some of you are growling as you read this post. but let's just take a second and step back.
Every week 2,000,000 checks go out. These checks are going to folks who under normal conditions would have been dropped from unemployment due to the normal expiration of a citizens right to unemployment. However we extended them. So these people whom have already maxed out the system were given an additional 100 pay checks. The working man paid for an additional two million salaries every week for two years. Don't forget these are just the folks whom were extended the extra 99 week duration. By this I am implying that there are way more then two million collecting unemployment.
Given the above considerations, if we do the math at just a 100 dollars a week then we come up with about 20 billion dollars. That is about the amount that all online advertisers spend over 3 to 5 months total. That accounts for at least a decade of porn revenue. Now our figure we just calculated is wrong. People get more then 100 a week.
I don't want to take part in a more realistic calculation. It is to scary.
So... as I stated earlier, two million unemployed Americans will have to say good bye to their unemployment checks.
GOOD!
How much you want to bet we see a spike in employment numbers with in 25 - 35 days.
I am calling it.
Friday, November 26, 2010
Looking Back at Cash For Clunkers - Obama Plan
August 2009
Cash for Clunker - Obama Stimulus Program
The phrase "Cash For Clunkers" has been all over the media as of late and for good reason. Cash For Clunkers is thus far the most successful economic stimulus program, this notion is impressive by any measure but is even more impressive when you take in the fact that it makes up less then 1% of the stimulus budget. Not to mention that this figure was increased three fold from the original 1 billion dollar budget to 3 billion which was passed by congress due to the overwhelming success.
What is the Cash For Clunkers Program?
The Cash For Clunkers Program is a Consumer spending and automotive industry stimulus program that awards consumers with a substantial rebate in the amount of 3,500-4,500 dollars for meeting the following:
The consumer must trade in a "clunker" which is a term to describe a older automobile that gets poor gas mileage. Clunkers get 18 or less miles to the gallon.
The consumer must then purchase a new car that is fuel efficient and at least 4 miles to the gallon more efficient then the clunker traded in. The Incentive or amount of the rebate awarded is much higher for a car that is 10 miles to the gallon more efficient then the clunker traded in.
As mentioned in the beginning of this article the Cash For Clunkers Program performed much better then expected which was the catalyst behind congress's decision to triple the budget. Taking a look at the financial numbers describing the economic activity makes the popularity of the Obama stimulus program quite evident.
Resulting Economic Activity of the Cash For Clunkers Program
Economic Activity surged and more importantly then how much is where. Consumer spending as well as the automobile sales were two of the most troubled aspects of the recession and these were the beneficiaries of Obama's Cash For Clunkers Program.
Consumer Value
The Cash For Clunkers Program allowed the consumer participants to obtain substantial value per dollar.
Environmental Implications
This program will obviously help the environment because of the programs focus on fuel efficiency.
Gas Prices
The cost of fuel or gas will inherit downward pressure because of the quarter million clunkers that have been taken off the road and replaced with a more fuel efficient counter part.
Jobs and employment
This program will obviously help improve the employment numbers given the increased consumer spending.
Credit and Lending Activity
These new automobile purchases gave an upward push to lending activity, as consumers took on secured debt to finance these purchases.
Cash for Clunker - Obama Stimulus Program
The phrase "Cash For Clunkers" has been all over the media as of late and for good reason. Cash For Clunkers is thus far the most successful economic stimulus program, this notion is impressive by any measure but is even more impressive when you take in the fact that it makes up less then 1% of the stimulus budget. Not to mention that this figure was increased three fold from the original 1 billion dollar budget to 3 billion which was passed by congress due to the overwhelming success.
What is the Cash For Clunkers Program?
The Cash For Clunkers Program is a Consumer spending and automotive industry stimulus program that awards consumers with a substantial rebate in the amount of 3,500-4,500 dollars for meeting the following:
The consumer must trade in a "clunker" which is a term to describe a older automobile that gets poor gas mileage. Clunkers get 18 or less miles to the gallon.
The consumer must then purchase a new car that is fuel efficient and at least 4 miles to the gallon more efficient then the clunker traded in. The Incentive or amount of the rebate awarded is much higher for a car that is 10 miles to the gallon more efficient then the clunker traded in.
- 3500 dollars is awarded for a four mile improvement.
- 4500 dollars is awarded for a 10 mile improvement.
As mentioned in the beginning of this article the Cash For Clunkers Program performed much better then expected which was the catalyst behind congress's decision to triple the budget. Taking a look at the financial numbers describing the economic activity makes the popularity of the Obama stimulus program quite evident.
Resulting Economic Activity of the Cash For Clunkers Program
- Approximately 700,000 - 750,000 Transactions or new car purchases
- Approximately 20 billion dollars in sales
Economic Activity surged and more importantly then how much is where. Consumer spending as well as the automobile sales were two of the most troubled aspects of the recession and these were the beneficiaries of Obama's Cash For Clunkers Program.
Consumer Value
The Cash For Clunkers Program allowed the consumer participants to obtain substantial value per dollar.
Environmental Implications
This program will obviously help the environment because of the programs focus on fuel efficiency.
Gas Prices
The cost of fuel or gas will inherit downward pressure because of the quarter million clunkers that have been taken off the road and replaced with a more fuel efficient counter part.
Jobs and employment
This program will obviously help improve the employment numbers given the increased consumer spending.
Credit and Lending Activity
These new automobile purchases gave an upward push to lending activity, as consumers took on secured debt to finance these purchases.
Monday, November 22, 2010
Nothing is Hotter Than Potter
I saw the financial figures from the weekend box office results of the new Harry Potter flick. My goodness, does this brand not run out of steam? Apparently not.
Potter's latest flick took in a total of 330 million dollars world wide over the weekend and 125 million in the US. The figure you are most used to hearing is the latter 125 million.
The latest flick, known as "Harry Potter and the Deathly Hallows: Part I", has set a new standard for Potter movies in terms of debut revenue.
The movie grossed 20% - 25% more then the next best debut performance of a Harry Potter flick. The next best was "Harry Potter and the Goblet of Fire" which yielded just over a 100 million during it's debut weekend in the US.
Harry Potter is now closing in on the 6 billion dollar mark as a franchise.
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Potter's latest flick took in a total of 330 million dollars world wide over the weekend and 125 million in the US. The figure you are most used to hearing is the latter 125 million.
The latest flick, known as "Harry Potter and the Deathly Hallows: Part I", has set a new standard for Potter movies in terms of debut revenue.
The movie grossed 20% - 25% more then the next best debut performance of a Harry Potter flick. The next best was "Harry Potter and the Goblet of Fire" which yielded just over a 100 million during it's debut weekend in the US.
Harry Potter is now closing in on the 6 billion dollar mark as a franchise.
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1977 Darth Vader Costume - Star Wars Costume
Online Retail Sales are Booming
Well business on the Internet has been booming like always. The online retail sales and finance figures for the third quarter of 2010 are in. The figures are very impressive.
Nearly 42 billion dollars of retail commerce took place over the three month period ending in September. This figure is up 15% year over year. If that was not impressive enough take the following notion into consideration. During that same period when Online retail increased by 15% retail sales in general dropped by almost 5%.
WOW. That is some steady growth.
Online retail sales are up 33% since the lows of the recession. Further online retail sales have doubled since 2005.
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Nearly 42 billion dollars of retail commerce took place over the three month period ending in September. This figure is up 15% year over year. If that was not impressive enough take the following notion into consideration. During that same period when Online retail increased by 15% retail sales in general dropped by almost 5%.
WOW. That is some steady growth.
Online retail sales are up 33% since the lows of the recession. Further online retail sales have doubled since 2005.
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Ireland Takes Bailout
If you have followed global finance at all over the last couple of weeks then you have undoubtedly been exposed to the current Irish bailout controversy.
The EU feels that Ireland is financially. This feeling was shared by some Irish. Though many folks from Ireland vomit at the notion of getting a bailout. Many feel they can handle things on their own.
Outsiders had mixed views as well. Certainly Germany, whom has been a strong economic rock amidst their peers struggles to obtain billions and billions in loans and other forms of stimulus, has their hang ups about financing yet another bailout. They have hardly been rewarded for their stable economy. They have just been writing checks left and right to bailout those who have fared less well.
Ireland finally accepted a 110 billion dollar bailout package which is composed of an 80 billion Euro three year loan package.
Personally I am just glad to see this thing through. I have been sick of hearing it.
The EU feels that Ireland is financially. This feeling was shared by some Irish. Though many folks from Ireland vomit at the notion of getting a bailout. Many feel they can handle things on their own.
Outsiders had mixed views as well. Certainly Germany, whom has been a strong economic rock amidst their peers struggles to obtain billions and billions in loans and other forms of stimulus, has their hang ups about financing yet another bailout. They have hardly been rewarded for their stable economy. They have just been writing checks left and right to bailout those who have fared less well.
Ireland finally accepted a 110 billion dollar bailout package which is composed of an 80 billion Euro three year loan package.
Personally I am just glad to see this thing through. I have been sick of hearing it.
Tuesday, November 16, 2010
Home is Shrinking - US Homes Shrink by Almost 10 Percent
Is your home shrinking?
In 2007 at the height of the housing illusion the average US home was approximately 2300 feet.
That is actually bigger then many surveys had consumers reporting what they thought the ideal size of a home was. The survey showed 2,000 feet to be ideal.
The average was about 15% larger as you can see. Notice how I said "was"...
The average new home today is now closer to the American "ideal" of 2,000 sq feet. Today the average new home is just a hair over 2,100 square feet. This is about 8% - 9% smaller then levels recorded at the height of the housing crisis.
This is most likely due to the markets demand for cheaper homes. That or builders are just trying to cut corners and increase margins.
Either way, I think this drop will make it easier and cheaper for new home buyers to obtain the financing they need to get a new home.
This information was found in a article from the USA Today newspaper.
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In 2007 at the height of the housing illusion the average US home was approximately 2300 feet.
That is actually bigger then many surveys had consumers reporting what they thought the ideal size of a home was. The survey showed 2,000 feet to be ideal.
The average was about 15% larger as you can see. Notice how I said "was"...
The average new home today is now closer to the American "ideal" of 2,000 sq feet. Today the average new home is just a hair over 2,100 square feet. This is about 8% - 9% smaller then levels recorded at the height of the housing crisis.
This is most likely due to the markets demand for cheaper homes. That or builders are just trying to cut corners and increase margins.
Either way, I think this drop will make it easier and cheaper for new home buyers to obtain the financing they need to get a new home.
This information was found in a article from the USA Today newspaper.
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Tuesday, November 9, 2010
Microsoft Fighting The Drug Cartel...... Software Piracy Cartel???
I was just reading the New York Times Sunday money section, and I stumbled on a story that was on a raid in Mexico. Apparently the same organizations that are responsible for drugs and the like have found a new operation to diversify their revenue streams.
They pirate software.
Go figure.
Apparently these guys burn, brand - co-brand, package, and sell pirated software and other digital goods such as video games. A lot of their inventory is apparently X-Box and Microsoft software such as Office.
They are very successful with distribution operations that rival real retailers. They move their product via street vendors and kiosks around the world.
I had no idea it was such an elaborate operation but apparently it is.
Bill Gates and the rest of the Microsoft people seem to be all over it are throwing quite a bit of money to finance efforts to squash this thing.
I can't say I blame them.
They pirate software.
Go figure.
Apparently these guys burn, brand - co-brand, package, and sell pirated software and other digital goods such as video games. A lot of their inventory is apparently X-Box and Microsoft software such as Office.
They are very successful with distribution operations that rival real retailers. They move their product via street vendors and kiosks around the world.
I had no idea it was such an elaborate operation but apparently it is.
Bill Gates and the rest of the Microsoft people seem to be all over it are throwing quite a bit of money to finance efforts to squash this thing.
I can't say I blame them.
Monday, July 26, 2010
Stabilizing The Housing Market – How America Did It
The mortgage loan and housing crisis created tremendous economic anxiety and directed the American economy towards a black hole of financial hardship.
Though the US economy is not out of the recession or perhaps depression, things have appeared to settle down a bit.
It looks as if the housing market may be stabilizing. This sis a article exploring the steps and actions that were taken to stabilize the US housing market.
All of these actions taken by our collective American government has really helped stabilize the US housing market.
It looks as if the housing market may be stabilizing. This sis a article exploring the steps and actions that were taken to stabilize the US housing market.
Key Actions of Housing Recovery
- The FHA's Efforts and Powerful Initiative
- Their efforts to spend capital on mortgage assets and securities when private capital was no where to be found.
- Political backing of their efforts to reform the financial markets and particularly the practices and operations involving debt and risk management.
- Obama’s Making Home Affordable Plan
- HAMP Modifications have helped 1.2 million homeowners obtain a loan modification
- HARP Refinance
- Lender Incentives
- Freddie Mae as acting agent for the MHA-C or the compliance assurance operations
- The Plans overall flexibility and agility to structure and restructure programs as they are needed.
- The Marketing and Advertising – aka the out reach efforts of the Making Home Affordable Plan
- The Hardest Hit Fund – Foreclosure Relief
- Home Buyer Tax Credit
- The home buyer tax credit added a great incentive for first time home buyers.
- The Nearly 25 Billion Dollars Given to US Housing Agencies
- US Housing Agencies were able to keep lending while other private lenders were saddle bagging cash out of fear and financial panic.
- 1.4 Trillion dollars of Purchases by the FED and Treasury to Keep Credit Markets from Choking
- Thank God. We would be Russian otherwise.
- Financial Support for Fannie and Freddie
All of these actions taken by our collective American government has really helped stabilize the US housing market.
Thursday, July 22, 2010
Refinancing Consumer Craze - Low Mortgage Interest Rates
Low Mortgage Rates – Low Mortgage Origination –
Sky Rocketing Mortgage Refinance Origination Loans
 |
| Low Mortgage Rates Create High Demand for Mortgage Refinancing |
Mortgage rates are low as they can be. I honestly do not know if we are ever going to see rates this low ever again. Though I should say that statements like that some how always seem to turn out wrong.
So with low mortgage rates you may suspect as I would that there would be high levels of mortgage origination's. Consumers would take advantage of such an opportunity.
Right…
…well…
…yes and no.
See the level of mortgage origination's is not rising. This is due to the low home sale figures as of late. But consumers are still taking advantage of the low mortgage rates.
Consumers are taking advantage of low mortgage interest rates by refinancing out of higher more profitable (for lenders) interest rate mortgage products into lower more borrower friendly loans. Mortgage refinancing activity has doubled from the end of the first quarter.
According to MBA, the Mortgage Banking Association, the weekly refinance index has pushed past 4,000. That number dwarfs recent index lows of 2,000.
I think that this is a positive trend for the American consumer. By refinancing into a lower mortgage rate homeowners will be able to lower monthly mortgage rates and and make home affordable.
This is a great opportunity for consumers to take advantage of the ability to utilize mortgage refinance as a debt solution in these times of financial hardship.
Thursday, July 15, 2010
Financial Reform Pushed Through By Democratic Majority and Three Republicans
A New Financial Industry Reform Bill Has Passed
Well 2,100 pages of potential American Policy and Law fixing to keep a tighter watch on the financial industries practices of marketing products to the American Consumer is on its way to Presidents Obama's Desk. Obama is expected to sign.
From what I have read thus far this bill is not really “known”.
That is a confusing way for me to put it but everything I have read has been vague at best.
ABC has said that the bill will add some consumer protection agency to keep a close watch on lending practices. Also Bond rating agencies may have to come up with a new business model which is well.... long over due.
Another potentially big aspect of this thing will effect derivative trading and the regulations that are put on private equity and hedge funds. That will be interesting to see play out.
Overall I think the financial markets do need some shape up or restructuring I guess I am just not sure that a 2100 page bill that no one really seems to understand or have even read seems a little fast.
I do believe and have faith in Obama to make the right decision on this one. He truly believes something needs to be done. I will support his decision regarding reform of the financial industry.
Related Articles
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Goldman Sachs Settles with SEC
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From what I have read thus far this bill is not really “known”.
That is a confusing way for me to put it but everything I have read has been vague at best.
ABC has said that the bill will add some consumer protection agency to keep a close watch on lending practices. Also Bond rating agencies may have to come up with a new business model which is well.... long over due.
Another potentially big aspect of this thing will effect derivative trading and the regulations that are put on private equity and hedge funds. That will be interesting to see play out.
Overall I think the financial markets do need some shape up or restructuring I guess I am just not sure that a 2100 page bill that no one really seems to understand or have even read seems a little fast.
I do believe and have faith in Obama to make the right decision on this one. He truly believes something needs to be done. I will support his decision regarding reform of the financial industry.
Related Articles
Reform or Refrain - Regulating the Financial Industry
Goldman Sachs Settles with SEC
Flaw of American Tax Law
Banks Lowering Debt Levels to Pretty Up Balance Sheets
Goldman Sachs Settles with the SEC - Over Half a Billion Dollars - No Financial Biggie
Goldman Sachs who really caught some heat from the subprime mortgage securities it was selling as securities (imagine that) settled with the SEC for a little more then 500 million dollars.
In the grad scope of things this is no big deal to old Goldman. However in light that i still do not see how acting as a broker and selling securities can end up as a 550 million settlement with the SEC.
I don't know about those guys.
The brass tax of all this boils down to a fine that represents approximately 4% of what Goldman made in earnings for that year. I think they are probably happy just to get this stuff over with.
I know I would be.
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In the grad scope of things this is no big deal to old Goldman. However in light that i still do not see how acting as a broker and selling securities can end up as a 550 million settlement with the SEC.
I don't know about those guys.
The brass tax of all this boils down to a fine that represents approximately 4% of what Goldman made in earnings for that year. I think they are probably happy just to get this stuff over with.
I know I would be.
Related Articles
Goldman Sachs Pumps Killer Earnings
SEC Calls Goldman Sachs Subprime Securities Sale Fraudulent
Financial Reform Bill is a Go
Sunday, May 16, 2010
Snoopy and Charlie Brown Sold Out - 175 Million Peanuts
Charles Schulz the creator of Peanuts and the lovable Charlie Brown and his dog Snoopy has managed to make waves across the branding and advertising world despite being dead.
Forgive the blunt language, I love the cartoon classic, I even contribute to the 2 billion a year in retail sales the trade mark and brand pump out on an annual basis (not for me my pops can not get enough of them {teachers}).
The brass tax of the deal boils down to the following:
Well I can't say I am surprised by the news. Don't get me wrong two years ago I would have been flabbergasted but it seems that selling off quality Brand names is the trend. This is apparently a symptom of financial hardship and economic crisis.
If you are not familiar with the new trend deal making involving the selling of brands for reasonably cheap prices then you may want to read up on the Marvel Comics Sale to Disney. Another great one that was for sale but no one purchased was the DOW Jones Industrial Average. I still can't believe they were considering that though really the buyer would have lost out because the index was for sale not the name but how do you reverse brand something like that?
The brass tax of the deal boils down to the following:
- The Charles Schulz Family and EW Scrips have sold the lovable bunch for 175 million dollars.
- The Buyers of Peanuts is a firm known as Iconix Brand Group..Iconix Brand Group will only have a 80% share and the schulz family will keep a 20% stake plus some royalties.
- The Iconix Brand Group is saying that they expect 75 million a year in royalties. This would thus seem like a pretty good deal. In three years they should actually profit from the deal.
- The deal however gets better they are also getting Dilbert and Fancy Nancy in the deal. Not sure on all the details or implications but that can't hurt.
Well I can't say I am surprised by the news. Don't get me wrong two years ago I would have been flabbergasted but it seems that selling off quality Brand names is the trend. This is apparently a symptom of financial hardship and economic crisis.
If you are not familiar with the new trend deal making involving the selling of brands for reasonably cheap prices then you may want to read up on the Marvel Comics Sale to Disney. Another great one that was for sale but no one purchased was the DOW Jones Industrial Average. I still can't believe they were considering that though really the buyer would have lost out because the index was for sale not the name but how do you reverse brand something like that?
Friday, April 23, 2010
50 Billion Decisions - Only One Steve Jobs - Apple's Mountain of Cash
Apple and Steve Jobs, their (Founder - CEO - and Savior) have a problem.
However this problem is a great freaking problem to have. Apple sits upon a green mountain that we will call Mount Cash. Apple has right around 40 billion dollars that typically sits on the side lines earning a mire fraction of 1% a year. Jobs main goal with these funds is pure preservation and who can blame him, given the market over the last couple of years.
Economy or no economy the fact is that in another year or so Apple should easily have over 50 billion dollars laying around doing nothing. Steve Jobs and the rest of the folks behind those cash machines known as Mac books and iWhatevers produce more then enough free cash flow to fund any necessary product development or R&D. Free cash flow levels should be around 12 - 16 billion dollars over the next 12 months. Sure every now and then Apple will spend a 300 or 400 million dollars to buy some young interesting company or firm but that just doesn't add up to anything significant when you consider how much these guys keep under the mattress.
What are the Choices for Apple and Steve Jobs?
I for one think this is an easy question.
First and foremost I think Jobs needs to pay his share holders. I don't know why companies don't pay their owners... well let me rephrase that i don't know why investors buy stocks that don't pay money when they clearly have more then they know what to do with.
Second and much more of a speculative suggestion, I think Apple should develop some sort of Adsense like publishers program. I think there is plenty of room in both display, and video content advertising in terms of innovation. Also a content targeted program is a proven model as long as you can accurately match supply with the content demanded.
iAd is going to be a great start. Every aspect Apple advertising with iAd and the way they are going about this is insanely clever and intuitive in my opinion.
I really wish I knew what Google was thinking when they found out.
Related Articles
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However this problem is a great freaking problem to have. Apple sits upon a green mountain that we will call Mount Cash. Apple has right around 40 billion dollars that typically sits on the side lines earning a mire fraction of 1% a year. Jobs main goal with these funds is pure preservation and who can blame him, given the market over the last couple of years.
Economy or no economy the fact is that in another year or so Apple should easily have over 50 billion dollars laying around doing nothing. Steve Jobs and the rest of the folks behind those cash machines known as Mac books and iWhatevers produce more then enough free cash flow to fund any necessary product development or R&D. Free cash flow levels should be around 12 - 16 billion dollars over the next 12 months. Sure every now and then Apple will spend a 300 or 400 million dollars to buy some young interesting company or firm but that just doesn't add up to anything significant when you consider how much these guys keep under the mattress.
What are the Choices for Apple and Steve Jobs?
- Payout a large chunk and plan a continuous dividend program for their faithful and entitled stock owners.
- Start buying back their own stock stock.
- Invest in a totally new direction and operation. Maybe even a search engine.
- Start investing for return with such investments in securities like bonds and stocks.
- Perhaps the best thing to do besides nothing when you don't know what to do is to do a little of everything.
I for one think this is an easy question.
First and foremost I think Jobs needs to pay his share holders. I don't know why companies don't pay their owners... well let me rephrase that i don't know why investors buy stocks that don't pay money when they clearly have more then they know what to do with.
Second and much more of a speculative suggestion, I think Apple should develop some sort of Adsense like publishers program. I think there is plenty of room in both display, and video content advertising in terms of innovation. Also a content targeted program is a proven model as long as you can accurately match supply with the content demanded.
iAd is going to be a great start. Every aspect Apple advertising with iAd and the way they are going about this is insanely clever and intuitive in my opinion.
I really wish I knew what Google was thinking when they found out.
Related Articles
Apple Reports Killer Earnings
Check out the New iAD Video Demo
Yahoo!'s Earnings Double
Innovative Investing Ideas
Sunday, April 18, 2010
Big Banks Bet and Bank on Trading Profits - BoA and Chase Ride Trading Revenue to Profitability
Both JP Morgan and Chase and Bank of America reported profitable quarters this earnings season go around.
Though Chase has been in better shape over this economic down turn both banks profitable quarters relied on their investment banking activities.
Chase Bank reported 3.3 billion dollars for the first quarters profit. Bank of America came in right behind them with 3.2 billion dollars. 3/4's or 75% of Chase Bank profits came from trading and investment banking activities and 2/3 or about 65% of Bank of Americas profits came from their newly found investment banking operations. This profitable Merrill Lynch deal has beat the overall outside consensus and expectations. Just goes to show you that old Ken Lewis knew and still likely knows what he is talking about.
Though it is the new guy Brian M. over there amidst the executive offices of Bank of America who is wiping the sweat of his forehead as the new CEO of Bank of America.
The New CEO, Brian T. Moynihan of BoA is doing a great job in my opinion. He is making some great decisions as the banking giant's leader.
His focus on image, loss mitigation, referral networking with the new investment banking operations and corporate banking division, and what ever else he is doing is certainly getting the job done (at least from what I have seen).
My finance hat goes off to him, as well as Ken Lewis who deserves some credit from the media, and of course the genius over there at Chase Bank, Mr. Diamond.
The stock prices of these two banking giants were unfortunately blocked and pushed down due to the outrageous claims of mortgage backed securities fraud against Goldman Sachs. This claim and lawsuit courtesy of the SEC.
Related Articles and Resources
Banks using Deceptive Accounting Practices - So What?
Debt Help and Debt Soloutions
Loss Mitigation
Though Chase has been in better shape over this economic down turn both banks profitable quarters relied on their investment banking activities.
Chase Bank reported 3.3 billion dollars for the first quarters profit. Bank of America came in right behind them with 3.2 billion dollars. 3/4's or 75% of Chase Bank profits came from trading and investment banking activities and 2/3 or about 65% of Bank of Americas profits came from their newly found investment banking operations. This profitable Merrill Lynch deal has beat the overall outside consensus and expectations. Just goes to show you that old Ken Lewis knew and still likely knows what he is talking about.
Though it is the new guy Brian M. over there amidst the executive offices of Bank of America who is wiping the sweat of his forehead as the new CEO of Bank of America.
The New CEO, Brian T. Moynihan of BoA is doing a great job in my opinion. He is making some great decisions as the banking giant's leader.
His focus on image, loss mitigation, referral networking with the new investment banking operations and corporate banking division, and what ever else he is doing is certainly getting the job done (at least from what I have seen).
My finance hat goes off to him, as well as Ken Lewis who deserves some credit from the media, and of course the genius over there at Chase Bank, Mr. Diamond.
The stock prices of these two banking giants were unfortunately blocked and pushed down due to the outrageous claims of mortgage backed securities fraud against Goldman Sachs. This claim and lawsuit courtesy of the SEC.
Related Articles and Resources
Banks using Deceptive Accounting Practices - So What?
Debt Help and Debt Soloutions
Loss Mitigation
Thursday, December 24, 2009
Economic Growth - GDP 2.2% - Is It Real?
The final numbers are in for the third quarter and the numbers show a 2.2% growth in the Gross Domestic Product, also referred to as GDP. Now this figure can be good or bad news depending on who you talk to.
If you ask me any positive growth is great news. I mean things have seemed so bad that the notion that economic activity is on the rise is extremely appealing.
On the other hand the expectations were set for about 3% so many investors were spooked when they saw a figure that was about 30% or so lower then they were thinking. Though other figures that came out along side these numbers helped ease the pain. For instance existing home sales, as well as home prices were both very positive.
I for one am just glad to see things going the right direction. But I can no help but to feel a bit skeptical of the numbers.
When I am out and about in the real world things just don't match the financial head lines. For instance, I noticed that the trick or treat tradition no longer exists in any comparative form to just 10 years ago. Though this is an observation of a local area, and hardly a sophisticated indicator, it does tell me that if there is growth, then the lack of trick or treaters must be accounted for some where. But where? I also noticed that there were no xmass tree dealers in town this year. They use to pack each and every parking lot. Where did they go?
I have seen little reason to believe that there has been any sort of growth. All I have witnessed, for my self, is less.
A little less of everything.
Any Thoughts?
Tuesday, September 29, 2009
Citi Bank Scales Back Retail Banking Operations
Citi Bank which is one of the largest financial institutions in the world and in to a little bit of everything and a little bit too much, has announced plans to scale back their retail banking operations and has said it will be reducing the number of branches.
They will keep the operation going for the long term but will focus only on the cities that they have a strong and secure presence.
Cities of Focus for Citi Bank:
- Chicago
- Washington
- New York
- L.A.
- San Fransisco
Citi Bank has tried over the years to establish a retail and community banking presence such as their counter parts Bank of America and Wells Fargo who each have 6000 locations a piece. Citi has never been able to capitalize on the market with only 1000 branches of their own and they will be closing many of those.
Overall this is probably a good move by the board over their in the struggling land of Citi Group. Their operations have been spread all over the place over the last decade and have failed to manage any sort of synergy such as Bank of America.
Saturday, August 1, 2009
Ben Bernanke to serve another term as the Chairmen of the Federal Reserve
August 2009
President Obama interrupted his vacation this late August to publicly announce that he is appointing Ben Bernanke to serve another term as the Chairmen of the Federal Reserve.
Obama did not shy from elaborating on his reasoning or feeling towards Ben Bernanke's work, He had more then enough praise for the current and future Chairmen of the Federal Reserve to hold a few press conferences. Obama was sure to lay claim to the fact that it was bernanke's extraordinary effort, quick and innovative thinking and problem solving that prevented the American Economy from spiraling down into a second great depression.
Congratulations to Ben Bernanke on his appointment to serve a second term as the Chairmen of the Federal Reserve. Let us all support his efforts to steer us back on the road to financial prosperity and away from that horrible world of foreclosure and mortgage default.
President Obama interrupted his vacation this late August to publicly announce that he is appointing Ben Bernanke to serve another term as the Chairmen of the Federal Reserve.
Obama did not shy from elaborating on his reasoning or feeling towards Ben Bernanke's work, He had more then enough praise for the current and future Chairmen of the Federal Reserve to hold a few press conferences. Obama was sure to lay claim to the fact that it was bernanke's extraordinary effort, quick and innovative thinking and problem solving that prevented the American Economy from spiraling down into a second great depression.
Congratulations to Ben Bernanke on his appointment to serve a second term as the Chairmen of the Federal Reserve. Let us all support his efforts to steer us back on the road to financial prosperity and away from that horrible world of foreclosure and mortgage default.
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