Monday, Feb. 16, 2009

So much for the Car Czar. Obama’s administration ditched the idea in the beginning of another busy week of financial news. Chrysler and General Motors (GM) had until Tuesday to submit restructuring plans to Congress, as part of their deal with the government to receive those emergency loans late last year. Seems like it was just yesterday when the Big Three were on Capitol Hill begging for cash.

Instead of having one person to oversee the restructuring of the bailed out auto companies, the President has reportedly been toying with the idea of putting together a whole task force instead to do the job, which will reportedly be lead by the Treasury Secretary, Tim Geithner.

One satellite radio company (alright, pretty much the only satellite radio company) has been in ‘sirius’ trouble with debt lately. Sirius XM Radio’s (SIRI) CEO, Mel Karmazin, was at risk of being removed by the company’s creditors if the company ended up filing for bankruptcy instead of making a deal with an investor.

Things to Ask When Refinancing

Took 4hrs to See Through Madoff

 Know When to Refinance

Read:
-No Car Czar
-'Sirious' Trouble
Watch:
-Top Toys of 2009
-UN Bailout?

Tuesday, Feb. 17, 2009

GM and Chrysler continued negotiations with the UAW and creditors to get their restructuring plans done by the end of the day. GM asked the UAW for concessions as part of the terms of its federal bailout.

Nationwide Average Gas Price:
$1.94 a gallon

Looks like Mel Karmazin will get to keep his job for now. Liberty Media Corp. (LMDIA) gave Sirius XM a lifeline investment of $530 million on Tuesday in the form of loans. Part of the loan will be used to repay its maturing convertible notes due immediately. Liberty will later receive 12.5 million shares of preferred stock as well as seats on Sirius’ board.

President Obama finally signed the stimulus bill into law Tuesday. The $787 billion package is largest stimulus plan in decades and is supposed to create jobs and push consumer spending.

http://www.recovery.gov/ was established to let taxpayers see exactly where their money is going in this plan, as part of Obama’s promise for transparency.

However, certainly not stimulated, the stock market fell markedly as financial stocks plunged and Wall Street worried about the economy. The Dow fell 300 points, hitting new lows for 2009 and barely avoided making a new six-year low, to 7553.

General Mills: We're Recession Proof

Where the $787B is Going

Private Jet CEOs: We're 'Vilified'

Read:
-Liberty Invests in Sirius
-Stimulus Bill Signed
Watch:
-How to Refinance
-Sirius Gets Lifeline

Wednesday, Feb. 18, 2009

Wednesday began with several economic reports, which were mostly disappointing. Housing starts continued hitting record lows, according to the Commerce Department. Construction of new homes fell 16.8% in January to a rate of 466,000 units a year, much bigger a drop than economists were looking for, and a 56.2% slower a pace than January last year. Meanwhile, import prices, which are supposed to reflect inflation in the economy, fell 1.1% last month, less than the expected 1.5%.

Another economic number, industrial production, took a hit as well in January, as some plants involved in the automobile industry across the country have been shutting down. Production fell 1.8%, even worse than the 1.5% economists expected.

President Obama outlined his foreclosure plan Wednesday, which is supposed to help stabilize home prices and keep people in their homes. This Homeowner Affordability Stability Plan will use $75 billion to help homeowners at risk of foreclosure stay in their homes by modifying their loans. Banks will be encouraged to lower their interest rates for a few years to temporarily lower the cost of monthly mortgage payments, while the Treasury will match the difference between this and the old rate. The balance on the principal could also be cut down, with the Treasury sharing the costs of this with the lender.

Starbucks Instant Coffee

Fed Mins: Inflation Will Stay Low

Romer: Housing Plan Is Enough

Read:
-Foreclosure Plan Outlined
-Housing Starts Fall
Watch:
-Schultz on Economy
-Relief Plan Problems

Thursday, Feb. 19, 2009

Wholesale inflation, which has been relatively flat for a while now, took its biggest jump in six months in January thanks to a sudden increase in gas and energy prices. Wholesale prices inched up 0.8%, much higher than the 0.2% economists were expecting, as gas prices jumped 15%, their biggest hike in 14 months.

While weekly jobless claims were unchanged last week, according to the Labor Department, continuing claims hit a record high. Continuing claims -- those already receiving unemployment benefits and still filing -- hit an all-time high of almost five million, even worse than expected. This is the fourth week in a row this number has hit a record. Just for comparison, this number was 2.77 million people a year ago.

Meanwhile, Swiss bank UBS admitted to helping Americans shield their money from the IRS, however, shares of the company were actually up for a bit after a settlement was worked out for $780 million. The bank also said it would identify American clients who were involved.

The gloomy economic reports and free-falling bank stocks knocked the Dow down to 2002 numbers. The index fell 89.68 points to 7466, a number not seen since October of 2002.

What I Learned Refinancing

Who Were Stanford's Victims?

Madoff Trustee Seeks Clawback

Read:
-Wholesale Inflation Jumps
-UBS Tax Probe Deal
Watch:
-$8B Fraud Uncovered
-UBS Gives Names

Friday, Feb. 20, 2009

Fear that the Bank of America (BAC) could literally become the Bank of America, or at least one of them, slammed stocks in the financial sector Friday. Talk of possible nationalization of some of the deeply troubled financial institutions, including Citigroup (C) and Bank of America, had the Dow falling 200 points earlier in the day, until the White House downplayed these rumors during a press conference.

"This administration continues to strongly believe that a privately held banking system is the correct way to go, ensuring they are regulated sufficiently by this government," said White House spokesman Robert Gibbs.

Meanwhile, some new evidence turned up in the Bernie Madoff case. Records show that for at least 13 years before his arrest, Madoff did not perform a single transaction for his investors. Madoff has been accused of running a gigantic Ponzi scheme and has been under house arrest.

And in a major victory for FOX Business as well as American taxpayers, a federal judge has decided that the Treasury Department has to comply with FBN’s Freedom of Information Act request for information on how bailout funds were used for AIG (AIG), the Bank of New York (BK), Citigroup and more. The department now has 30 days to provide this information.

Click here to see what FBN sued for.

Click here to view the story and court document

This Madoff Is a Doll, Literally

FBN FOIA Victory

A Taste of Kraft

Read:
-FBN FOIA Victory
-New Madoff Evidence
Watch:
-Cultural Cartoons
-Starting From Scratch?