Marketplace

Search

April 2009 Archives

What you get if you're unsecured

Remember that $4 billion of OUR MONEY the Bush Administration lent to Chrysler last year to keep it out of bankruptcy? Well, here’s what we can expect to get back in this restructuring.

pink_sprinkled_donut.jpg

The Free Press reports the government was unable to secure its loans to any assets. Our loan is not backed by any collateral, in other words, which means we will be paid back only as much as any other unsecured debtors.

Which means a donut. A bagel. Zero.

Now, who wants 50 percent of General Motors?

My name is Tom Cranker

Fans of Woody Guthrie will doubtless be familiar with his classic, The Jolly Banker, which lampooned lenders more than 70 years ago. His words seem particulalry apropos today.

When your car you’re losin’, and sadly your cruisin’, I’m a jolly banker, jolly banker am I. I’ll come and forclose, get your car and your clothes, Singin’ I’m jolly banker, jolly banker am I.

So apropos that Chicago rockers Wilco have recorded a version.

wilco.jpg

Wilco frontman Jeff Tweedy talked with Marketplace host Kai Ryssdal today about why Wilco decided to record a version of the song.

Continue reading My name is Tom Cranker

Thanks for that, Google

Marketplace Morning Report producer Rod Abid was searching for Web for information on the Committee of Chrysler Non-Tarp Lenders today. Here’s what Google spat back:

paddypic_300px.jpg

As Rob noted, wasn’t the Neon part of what got them in trouble in the first place…?

Flighty

The Seattle PI reports Boeing’s Vice President of Flight Test Operations Barbara Cosgrove began a presentation yesterday with this slide:

boeing.jpg

How’s that Dreamliner coming, Babs? Word is you’re only about 45 percent of the way there.

Nardelli drinks the Kool-Aid

Nardelli just told Maria Bartiromo on CNBC that he, too, believes Chrysler could be out of bankruptcy within three to six months.

bob_nardelli.jpg

Nardelli admits, “I’m not an expert on bankruptcy, I don’t want to be an expert on bankruptcy.”

Looks like you’re out of luck there, Bob.

Cramdown bill dies in Senate

Tough luck if you’re in danger of defaulting on your home loan. Senators rejected a bill today that would have allowed bankruptcy judges to cut mortgage terms to help borrowers avoid foreclosure. The “cramdown” legislation was voted down 51 to 45. A Bloomberg report described the defeat as a setback for the Obama administration, which included cramdown in the anti-foreclosure plan aiming to help 9 million homeowners.

“These bankers who brought us into this crisis are literally shunning and stiff-arming the people who are facing foreclosure,” said Senator Richard Durbin of Illinois, sponsor of the legislation and the Senate’s second-ranking Democrat.

Continue reading Cramdown bill dies in Senate

Beep beep

Congratulations on your new Chrysler!

fiat.jpg

The first few cars from the Chrylser-Fiat alliance could hit American roads and Chrysler dealerships early in 2010. Mark Phelan over at the Freep says Fiat is eager to test America’s appetite for its stylish little 500 minicar. Phelan says we can expect to see limited numbers of this pint-sized roasdster on American highwqays early next year, but the flood of small, fuel-efficient models Chrysler needs will not arrive before mid-2011.

Unstoppable

Here’s how John Carney over at Clusterstock sees the Chrysler bankruptcy proceeding.

caroffcliff.jpg

CNBC’s Maria Bartiromo gave a breathless yet brimming report on the Chrysler filing to Larry Kudlow this morning. The senior lenders digging their heels in say they didn’t take TARP funds, and have been refused direct contact with the Obama adminstration during the restructuring negotiations.

Continue reading Unstoppable

Obama: Chrysler reorg won't take long

The president will make an announcement about the auto sector, and Chrysler in particular, at noon. A Bloomberg report quoted an unnamed official citing the failure of some small creditors to agree to a final settlement. So it looks as though Chrysler will file for bankruptcy under Chapter 11 of the code after all. The Obama Administration has done everything it can to avoid this, and yet Obama said yesterday that the process won’t be so painful after all.

“It would be a very quick type of bankruptcy, and they could continue operating and emerge on the other side in a much stronger position,” Obama said. The goal is to finish the bankruptcy in 30 to 60 days, people familiar with the plan said.

So let me get this straight. After months and months of tortuous scrapping, it turns out that Obama now thinks bankruptcy would be the quickest, cleanest solution for Chrysler after all? You mean, bankruptcy doesn’t mean death, but can lead to the creation of a more streamlined, efficient entity?

Continue reading Obama: Chrysler reorg won't take long

Morning reading

The news that Ken Lewis is out as Chairman of Bank of America has given the company’s stock a lift in pre-market trading. Prepare to watch BAC take off out of the gate today.

The Chrysler story continues to run. We reported last night that they would likely file for bankruptcy this morning, but there were some last-minute negotiations with creditors that some hoped might save the day. Today, however, the Wall Street Journal says a filing is imminent after those talks collapsed.

In the other game of chicken going on in Detroit, GM bondholders have counter-offered. They were offered a 10 percent stake in a reorganized GM for all their bonds. Now, according to a Bloomberg report, the bondholders say they’ll do a swap, but they want 51 percent.

Continue reading Morning reading

Ken canned

Ken Lewis that is. The Charlotte Observer reports that Lewis is out as Chairman of the Bank of America board, and Walter Massey is in. Lewis will hold on to his CEO title.Of course, there are those who argue he should resign that, too.

The result comes at the end of along day that saw a delay in the vote count, and then a recount. Exciting stuff!

There’s a groundswell of opinion saying the roles of Chairman and CEO should always be separate.

Continue reading Ken canned

Chrysler hits the wall

President Obama will announce the bankruptcy of Chrysler Corp. tomorrow. This according to a variety of “sources said” stories circulating, including this one from Bloomberg. The filing will coincide with an alliance with Fiat.

The Italian company would become a 20 percent owner of Chrysler, and a union retiree health-care trust fund would own 55 percent, with the rest of the company staying in the government’s hands initially.

Nearly there!

Lewis Ranieri says we’re within “shouting distance” of the bottom of the housing market.

Really? Ranieri’s the guy who pioneered securitization: the bundling of credit card debt, home loans, auto loans, you name it, into bonds. He told attendees at the Milken Institute Global Conference today that the slump in housing has created some great buying opportunities, and made it easier for middle class Americans to by a house.

Continue reading Nearly there!

Pass the salt

The Fed apparently sees light at the end of the tunnel. That’s the conclusion you’d draw from the headlines at least. Fed Sees Signs Recession Easing (WSJ); Fed Cites Easing of Downturn and Affirms Policy (NYT); Fed sees signs recession may easing (sic) (LAT)

Forgive me if I leave the prosecco in the ‘fridge for now.

Continue reading Pass the salt

Cliffhanger in Charlotte

The voting over Ken Lewis’ Chairmanship is done, but it’s gone to a recount.

Short back and sides

The debate over haircuts for debtholders has finally gone mainstream, thanks to David Leonhart over at the New York Times.

What on earth am I talking about? Simply, the idea that taxpayers shouldn’t be the only ones on the hook for bailing out the banks. Bondholders, the people who lent the banks the money, and thus arguably enabled their excesses, should also share in the pain. How? By swapping their bonds for shares in the banks. Because the bonds would likely be valued downwards before the swap took effect, this would mean they’d be taking a loss, or a haircut. And if stock prices didn’t recover, it could turn out to be a high-and-tight, boot recruit crew cut.

Continue reading Short back and sides

Many happy returns. Or not.

CNBC is still keeping an eye on America’s favorite fraudster. Clusterstock wishes him Happy Birthday.

berniecell-tbi-0.72x0.72.jpg

How much is that again?

If you’ve seen my Whiteboards, you’ll know I’m a fan of anything that simplifies complex terms. I’ve been puzzling over the Obama administration’s much-trumpeted plan to cut $100 million dollars out of the federal budget. Is that a big cut or not?

Marketplace reporter Jeremy Hobson sent me a Youtube video that puts the cuts in context in a whimsical way.

Hundred days

A lot of bits and bytes being expended on the first hundred days of the Obama adminstration this week. The BBC has a nice slideshow, the LA Times has videos, picture galleries, reader commentary, the whole nine yards.

I thought it might be useful to look at the trajectory of the Dow Jones Industrial Index over the first hundred days (or thereabouts).

dow09.png

Continue reading Hundred days

Live from Charlotte

Who says Twitter ain’t cool? Rick Rothacker is tweeting (if I have that verb correct) from the Bank of America shareholders conference this morning, bless him.

Here’s one side of the debate (thanks, Dealbreaker)

ken_lewis_truck.jpg

Waiting for the Fed

Equity markets have started well, and consensus appears to be that investors are hoping for a sunny assessment of the state of the economy from the Federal Reserve today.

What? Didn’t we just report a 6.1% drop in GDP?

Continue reading Waiting for the Fed

Morning reading

Hi, Paddy Hirsch here. Scott will be back next week, after a well-earned vacation. It’s shaping up to be a hot one in Los Angeles his morning, but I’d say the markets only look lukewarm, thanks to some depressing economic news. Fresh gross domestic product data showed the economy shrank at a steeper-than-expected pace in the first quarter. Swine flu continues its rampage through the media and the country. The BBC reports scientists in the UK are working up a vaccine, athough the last vaccine, in the 70s, killed more people than the flu.

Continue reading Morning reading

Should I wear a surgical mask?

I’m heading off on vacation for the next few days. And yes, I will be flying. The travel industry is clearly worried about swine flu. I guess I’ll take the government’s approach and keep an eye out for sick-looking people.

Continue reading Should I wear a surgical mask?

Condoms for banks

The Supreme Court heard arguments today in a case that could change the way banks are regulated. Or rather, who regulates them as it pertains to consumer protection. This pits the Treasury Department against state attorneys general, and stunningly includes the word prophylactic.

Continue reading Condoms for banks

Laugh of the Day

It comes from the Onion News Network. Who else? Their latest spoof has the Treasury Department issuing an emergency recall of US dollars in circulation. All of them. The news conference is a gut-buster — that, or sadly too close to the truth.

Continue reading Laugh of the Day

Outrage, from the Left

Just read a compelling interview with Naomi Klein, author of Shock Doctrine. For a liberal who I’m sure didn’t participate in the tea party protests, she sure sounds just as angry as those people. She begins: “I’m appalled at news that there’s a 17-year-old girl who is facing jail time for having a few beers and breaking a window at the RBS Bank during the G-20 protests, when not a single banker is going to jail for burning down the global economy. What kind of a system is that?”

Continue reading Outrage, from the Left

TV is safe for kids now

Today, the Supreme Court upheld an FCC policy that allows the agency to assess huge fines on local and national broadcasts that air even a “fleeting expletive,” like Bono’s awards show f-bomb.

Continue reading TV is safe for kids now

Car magazines driven to bankruptcy

Those mags that write about cars are showing the car companies how to do a quick-turnaround bankruptcy. Today, Source Interlink, the publisher of Motor Trend, Hot Rod and Automobile magazines filed a “pre-packaged” Chapter 11 and announced plans to go private.

Continue reading Car magazines driven to bankruptcy

Morning Reading

You know it’s coming — someone Tweeting their swine flu symptoms. I can hardly wait. In the meantime, the rest of the media are acting like they usually do in times like this. Even NPR has started a swine flu blog. As Inspector Clouseau would say… swine blogs.

Swine-blogs.jpg

Continue reading Morning Reading

Walking a thin swine

Governments and health organizations are in a precarious position with the swine flu outbreak. On one hand, they must act swiftly and decisively, lest this threat actually turns into a pandemic. On the other hand, if they overreact, they could endanger the already-depressed economy and their credibility.

Continue reading Walking a thin swine

What foreclosure smells like

One part algae, one part rotting, water logged leaves, and occasionally a drowned animal. That’s how a new documentary from American Radio Works describes the smell coming from abandoned swimming pools in Las Vegas. Sin City has become Foreclosure City.

Continue reading What foreclosure smells like

Planes panic New Yorkers

Hundreds of workers ran from the New York Mercantile Exchange this morning. Why? Well, what would you do if you worked near the World Trade Center site and looked up and saw fighter jets and a passenger plane flying low?

Continue reading Planes panic New Yorkers

April Fools revisited

How often April Fools jokes imitate life. Or is it the other way around? April 1st, Marketplace aired a faux story about how people desperate to sell their homes were hiring actors to be warm and friendly “neighbors.” Well, check out this story in today’s Wall Street Journal. It’s not a joke.

Continue reading April Fools revisited

Morning Reading

The last thing we need in a deep recession is a flu epidemic. Of course, given the usual overreaction that comes with any kind of animal-related flu, I’m sure we’ll stop it in its tracks, thanks to Matt Drudge. Other things to read:

Continue reading Morning Reading

Guess this week's theme

See if you can figure out the theme of my After the Bell podcast by the songs you’ll hear in it: “The Other Side” by David Gray, “Stayin’ Alive” (Giles David Orchestra version) and “I Will Survive” by Cake. Find out the answer by listening to the podcast! It’s free. About 17 minutes long this week.

Work for free, but make a difference

As the unemployment rate has gone up, so has the number of people volunteering. In March, Americorp said applications almost tripled. And this week, the President rewarded the program by tripling it in size over the next 8 years.

Continue reading Work for free, but make a difference

Red, Black and Green

Yes, this is a story about Nevada and gambling. It also includes three people whose last names are, seriously, Redd, Black and Green. Our Senior Business Correspondent Bob Moon spent part of his childhood in a little Nevada truck stop-town called Mesquite. He went back to tell the story of what’s happened there.

Continue reading Red, Black and Green

The Secret Life of Bernie Madoff

Fortune has a fantastic article today called “How Bernie Did It”. It’s the most comprehensive look yet at this strange man and why his Ponzi scheme worked so well. And Fortune says we may learn more if one of Madoff’s lieutenants cops a plea.

Continue reading The Secret Life of Bernie Madoff

Morning Reading

Chrysler has six days. There’s still the glimmer of hope for a deal with Fiat. But more than likely, Chrysler is going bankrupt.. Other things to read:

Continue reading Morning Reading

The 173-year old robber baron

I just thought this was amusing. The Economic Times has a list of the 20 worst CEO’s of all time. They include Lehman CEO Dick Fuld, Angelo Mozilo of Countrywide, Enron’s Ken Lay, Bear Stearns’ Jimmy Cayne, etc. And they have pictures…

Continue reading The 173-year old robber baron

Credit cards -- it's everyone's fault

Credit cards rates and rules seem to be the issue du jour. The President met with credit card issuers today and said he would push for new laws to protect consumers from lending abuses. Two senators called for an emergency freeze on rates for current balances. Once again, the government is crying fire! after the house has burned down.

Continue reading Credit cards -- it's everyone's fault

Twitter and using your brain

This is a cool story. A biomedical engineering student at the University of Wisconsin-Madison has come up with a way to Twitter just by thinking the letters you need to spell.

Continue reading Twitter and using your brain

Lewis spills the beans too late

Bank of America CEO Ken Lewis has revealed his version of what happened behind the scenes of the bank’s deal to buy Merrill Lynch. The Wall Street Journal cites testimony from Lewis to New York’s attorney general. Lewis says he believed former Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke wanted him to keep quiet about billions of dollars in losses at Merrill so that the deal wouldn’t collapse.

Continue reading Lewis spills the beans too late

Morning Reading

The eyebrow raiser of the morning is the WSJ story on Bank of America CEO Ken Lewis. Lewis claims Hank Paulson and Ben Bernanke pressured him to keep quiet about losses at Merrill Lynch before B of A closed the deal to buy Merrill. I’ll have more on that shortly. Here are some other things that caught my eye:

Continue reading Morning Reading

The banks and jobs

What it really boils down to for the banks is — how many people in this country are out of work? The banks’ health is inextricably linked to the unemployment rate, as explained by FBR Capital analyst Paul Miller in a report today. Also, one of the banks actually admitted to using new accounting rules to alter the books.

Continue reading The banks and jobs

Flint's solution: Tear it down

Flint, Michigan has to be one of the saddest towns in America. But instead of wallowing in misery, the New York Times says some leaders in Flint are proposing a radical solution: Start over. Demolish entire blocks and perhaps entire neighborhoods.

Continue reading Flint's solution: Tear it down

Bailed out companies still lobbying away

The big companies that took TARP money and other government funding spent $10 million in the first three months of the year on lobbying the government. The Washington Post cites Senate disclosure records that say GM, Citigroup and JP Morgan put the most money into lobbying efforts.

Continue reading Bailed out companies still lobbying away

Internet sales tax coming?

Somehow I missed this story a couple days ago, but Congressional lawmakers are about to introduce bills that would eliminate the “brick and mortar” requirement for collecting Internet sales taxes.

Continue reading Internet sales tax coming?

Not just fake goods, fake stores

Our Shanghai bureau chief Scott Tong directed me to this story in the Shanghai Daily. Chinese officials have added entire stores to their list of intellectual property rights violations.

Continue reading Not just fake goods, fake stores

Morning Reading

The CFO of Freddie Mac was found dead this morning. Reports say he killed himself. David Kellerman had just been named CFO last September. He was 41 years old. In a possibly related story, CNN reports that Freddie Mac faces SEC and state investigations. Other things to read:

Continue reading Morning Reading

"Jumping the shark" has jumped the shark

I’d rather watch re-runs of Fonzie on water skis than read another headline that a company, a TV show or a person has jumped the shark. But alas, in this fast-paced age of Twitter, the phrase pops up all the time. In fact, Twitter has jumped the shark. Didn’t you hear?

Continue reading "Jumping the shark" has jumped the shark

Left hand, meet the right hand

One hand is the Treasury Department. The other hand is Congress. The two hands don’t seem to be attached to the same body, but somehow, together they might still manage to strangle the program designed to buy toxic assets from the banks.

Continue reading Left hand, meet the right hand

Rejection: It's like Wheaties

How’s this for a sign of the times? Harvard just hosted a new seminar for students on how to handle getting rejected. Yes, Harvard.

Continue reading Rejection: It's like Wheaties

America's Newest Profession

Can you guess what it is? Hint: ME. The Wall Street Journal claims there are almost as many people making their living as bloggers as there are lawyers. Let me do my blog thing and say… I find that extremely hard to believe.

Continue reading America's Newest Profession

The Great Disappearing Act

If you want to see what happened to employment in America, Slate has a brilliant map that shows the progression on job losses by county. When you push play on the map, you can see how the job losses ate away at the country, region by region. Thanks to Marketplace reporter Jeremy Hobson for the heads up.

New airline food - Milkbones

A Florida couple is starting an airline just for pets. Petairways will begin flying in mid-July from regional airports near five cities — NY, Washington, Chicago, Denver and LA. A very intelligent Border Collie will fly the planes. The flight attendants are all highly-qualified Australian Shepherds.

Continue reading New airline food - Milkbones

Morning Reading

Looks like GM and Chrysler are getting more money from the government. Chrysler will receive half a billion to help tie up a partnership with Fiat. GM will get up to $5 billion to try and restructure out of bankruptcy. Other things that caught my eye:

Continue reading Morning Reading

No Pulitzers for financial journalists

The Pulitzer Prizes were awarded today, and even though the economy has been the dominant story in every paper for months, not one financial journalist won first prize. This was also the first year wholly online publishers could compete. And there were no winners there either.

Continue reading No Pulitzers for financial journalists

'Atlas Shrugged' comes off the shelf

I find it fascinating that so many people are reading, talking about, buying and using Ayn Rand’s 1957 novel, “Atlas Shrugged.” The book has recently soared up Amazon’s list of best sellers and is now #1 on the classics list.

Continue reading 'Atlas Shrugged' comes off the shelf

Commercial radio doing the NPR thing

For-profit radio stations have started asking their listeners for donations to make up for lost ad revenue. Even the national network, Air America, is considering “pitching” for money, according to the Wall Street Journal.

Continue reading Commercial radio doing the NPR thing

It just gets weirder and weirder

A blogger claims he was leaked the results of the bank stress tests. He backs it up with a bunch of numbers, including that 16 out of the top 19 banks are technically insolvent. The Financial Times links to his post. The Treasury issues a statement in response. The stock markets trade on it. Oh, did I mention the blog is run by a white supremacist?

Continue reading It just gets weirder and weirder

My new T-shirt

I was window shopping in my neighborhood this weekend when a black t-shirt caught my eye. Since consumer spending is a significant chunk of the economy, I decided to do my part and consume this shirt.

Continue reading My new T-shirt

Morning Reading

President Obama holds his first formal Cabinet meeting today, and he plans to ask his department heads to find $100 million to cut from the budget. Remember now, Obama’s budget proposal is 3.5 trillion dollars. Other things to read:

Continue reading Morning Reading

Did seeing equal believing?

My weekly After the Bell podcast is now available. Each Friday, I take a look back at the week in business and the economy and help you make sense of what happened. This week, we saw some things that seemed hard to believe. How much there was there? You can get the entire podcast here. It begins with this opening essay:

The TARP backlash is in full swing

Many banks are sick and tired of TARP and want to give their money back. Not only that, they’re protesting the government’s requirement of paying 5% interest on the loans.

Continue reading The TARP backlash is in full swing

The unemployment fault line

The chasm is growing between states with high unemployment and those with a low jobless rate. Today’s unemployment numbers for March show that California has its highest rate of unemployment since 1976.

Continue reading The unemployment fault line

Is there a secret donor society?

In the past few weeks, at least nine universities have gotten a total of $45 million in donations. In every case, the schools had to promise not to find out the identity of the donor.

Continue reading Is there a secret donor society?

We get to keep the losers

After four major bank earnings reports, it’s pretty clear what’s about to happen. The stronger banks, like Goldman Sachs, JP Morgan and Wells Fargo are going to pay back their TARP money and bolt free of the government. Taxpayers will be left holding the gooey remains of Citigroup, AIG, Fannie and Freddie and maybe GM and Chrysler.

Continue reading We get to keep the losers

Morning Reading

Citigroup earnings are out. The bank ended a five-quarter losing streak, thanks in large part to $45 billion from US taxpayers. Other things to read:

Continue reading Morning Reading

Time Warner backs off broadband fees

Time Warner Cable said today it’s not going forward with plans to charge people for how much internet bandwidth they use. The reason? Too many people complained about it.

Continue reading Time Warner backs off broadband fees

Are you on board?

Today, the President unveiled his plan for a high-speed rail network. He identified 10 potential high-speed rail corridors and said the start-up funding would come from $8 billion in his stimulus package and another $5 billion over five years.

Continue reading Are you on board?

It's a dirty job, and no one wants it

While Florida is trying to save the yacht and plane industry, Maryland is worried about crabs. Crab-picking season just got underway, and despite the unemployment rate, it’s a job no one wants to do. So, guess where the seafood industry might turn?

Continue reading It's a dirty job, and no one wants it

The yacht and plane stimulus

Like most states, Florida is cutting the budget, laying off workers and increasing fees and taxes. But Florida’s legislature is also considering a bill that would dramatically cap taxes on yachts and private planes. It’s being called, I kid you not, the Aviation and Maritime Full Employment Act.

Continue reading The yacht and plane stimulus

The banks sure look pretty, don't they?

This morning, JP Morgan continued the parade of attractive bank profits — $2.1 billion for the quarter. Not only that, but the bank’s CEO, Jamie Dimon, said he no interest in selling any “toxic” assets through the Treasury’s public-private partnership. In fact, he said “toxic” assets aren’t a problem at all!

Continue reading The banks sure look pretty, don't they?

Morning Reading

A little good news about the job market this morning. The number of people filing for unemployment benefits fell last week. Still, a record six million people are standing in the unemployment line. If you look at the the Bureau of Labor Statistics’ latest chart, the Thibodaux, Louisiana area has the lowest unemployment rate, followed by Ames, Iowa. 9 of the 10 highest rates are in California, and they’re all over 16%. Other things to read:

Continue reading Morning Reading

Taxpayers aren't getting a "refund"

When you hear about banks like Goldman Sachs returning their TARP money, you might think that means the taxpayer is getting something like a refund. Or that those funds will go to reducing the government’s bailout debt. No. In fact, it may mean the government will spend more money.

Continue reading Taxpayers aren't getting a "refund"

Dumping on the tea parties

Why is it that conservatives aren’t allowed to protest? Is it because they’re generally the party of the status quo and not the party of “change?” Memo to the party poopers: Let these people have their tea parties. Listen to what they’re saying.

Continue reading Dumping on the tea parties

Hope for the unemployed!

I just have to share this with you. Maybe you’re one of the 2.7 million people who’ve already watched it on YouTube this week, but if not, you must see this performance from the show, Britain’s Got Talent.

Continue reading Hope for the unemployed!

United: Heavy passengers must buy two seats

United Airlines is implementing a new policy that significantly overweight passengers will have to buy two seats if there aren’t two empty seats together on the flight.

Continue reading United: Heavy passengers must buy two seats

Morning Reading

It’s been more than 50 years since the Consumer Price Index fell on an annual basis. Last time it happened was 1955. This morning, the government said retail prices fell in March and dropped 0.4% year-over-year. Other things to read:

Continue reading Morning Reading

Give whatcha can

Not everything’s about buying or selling. There’s also giving and needing. Reporter Jeff Tyler produced a feature for the Marketplace Morning Report on giving to charities. Jeff felt the need to do a little more, so he sent me this:

Continue reading Give whatcha can

Sell whatcha got

If you need some extra cash to pay the IRS or just the light bill, trendwatching.com has a few suggestions. The site claims one new trend in the recession is sellsumers, obviously the opposite of consumers. Trendwatching says: “If saving is the new spending, then selling is the new saving.”

Continue reading Sell whatcha got

Six months later...

I always find it fascinating to check in with people over time. Marketplace reporters Amy Scott and Tess Vigeland are doing a little longitudinal study of their own this week. They’re revisiting some of the same people they met on a road trip last fall. There seems to be a theme running through their conversations so far.

Continue reading Six months later...

Will taxpayer defaults be next?

The IRS comes calling tomorrow, and it looks like many people won’t be able to pay what they owe. And because of the recession, more Americans may owe. The IRS is promising to be gentler this year, but the government still has to collect the money, especially considering the trillions of dollars in new spending.

Continue reading Will taxpayer defaults be next?

I'm still not buying it

Maybe I’m just being stubborn, but something still doesn’t seem right about these bank earnings. Goldman Sachs followed Wells Fargo with “better-than-expected” profits for the first quarter. New York Times reporter Floyd Norris summed it up while live-blogging Goldman’s conference call this morning: “One answer is that this is a great time to be in the banking business — if you ignore what we politely call legacy assets.”

Continue reading I'm still not buying it

Morning Reading

Retail sales were down in March and stocks are down this morning. But Fed Chairman Ben Bernanke sees signs of recovery. Other things to read:

Continue reading Morning Reading

New guest courtesy - No newspaper

Marriott has decided to offer a new perk for guests — if you don’t want a newspaper, we won’t give you one. The company says starting June 1, guests can choose to have one of several papers dropped off at the door, or they can choose to have no paper at all. Marriott says this will reduce newspaper distribution by about 18 million a year.

Continue reading New guest courtesy - No newspaper

Shooting pirates and TV pilots

Reality TV knows no bounds. The day after Navy snipers took out three Somali pirates is the perfect time, it seems, for Spike TV to announce a new reality show — Pirate Hunters, USN. The US Navy will allow cameras on board two warships as they track down pirates off the coast of Africa.

Continue reading Shooting pirates and TV pilots

On The Road Again

This week, Marketplace is back on the “Road to Ruin?” Last October, reporters Tess Vigeland and Amy Scott started at opposite ends of the country and met in the middle (St. Louis). They each stopped in five places along the way, talking to Americans about the economy. This week, Tess and Amy are retracing some of their steps.

Continue reading On The Road Again

Who says there's no advertising?

There may not be as many TV ads for toothpaste or breakfast cereal, but Politico points out the “avalanche” of issue ads on cable TV. Lobbyists, unions and activists have spent $270 million on advertising just since President Obama took the oath of office.

Continue reading Who says there's no advertising?

80-grand to take a year off

Impromptu poll question — If your employer offered you a year off from work and paid you a third of your salary to do it, would you take it? A New York law firm is offering all 1,300 of its associates that deal.

Continue reading 80-grand to take a year off

Morning Reading

The government is telling GM to get ready for a June 1st bankruptcy, according to the New York Times. GM bondholders have a tough call. Do they hold out and take their chances with Chapter 11? They could fare better that way, or as happened with Lehman creditors, instead of a haircut, they might get a severe buzz cut in banktruptcy. Other things to read:

Continue reading Morning Reading

The week that was

My weekly After the Bell podcast is now available for download. You can access it on the Marketplace podcast page or go directly to iTunes. It’s 15-20 minutes long, and it’s free. Each Friday, I try to make sense of the week in business and the economy. Below is my opening essay - a sneak preview, if you will:

Always Be Closing

You probably heard that Fox is planning a new reality series called “Someone’s Gotta Go.” Each episode, employees of a small business that needs to cut costs will decide which of their colleagues gets fired. Instead of wasting time thinking about that, I thought — not all Hollywood productions about business are monumentally stupid. In fact, there’ve been some fine films.

Continue reading Always Be Closing

Pirates of the Somali coast

If you just hear the news that pirates hijacked an American ship and took the captain hostage, maybe it’s natural to shout, “Off with their heads!” Or if you just read that the Somali pirates are fisherman fighting for their food supply, it’s easy to have some sympathy. But of course, it’s more complicated than that.

Continue reading Pirates of the Somali coast

I wouldn't pass the stress test

The banks are stressing me out. I can’t stand all the secrecy and the magic accounting tricks and the government’s indecipherable measurement tools. Was Wells Fargo’s CEO right when he called the bank stress tests “asinine?”

Continue reading I wouldn't pass the stress test

Morning Reading

The President meets with his economic advisers today to talk about stimulus, bank stress tests and whether the economy is, in fact, showing signs of life. The head of Obama’s council, Larry Summers, says, “The sense of a ball falling off a table, which is what the economy has felt like since the middle of last fall, I think we can be reasonably confident that that is going to end within the next few months, and we will no longer have that sense of a free-fall.” Other things to read:

Continue reading Morning Reading

Summers Gets "Pinked"

The Code Pink protesters were at it again today. For the second time this week, they interrupted a speech on the economy. This time, the victim was National Economic Council Director Larry Summers.

Continue reading Summers Gets "Pinked"

Come on! Buy bailout bonds!

I’m sure you’ve seen those old World War I posters - Buy War Bonds, Keep Us Flying! The government sold bonds to Americans as a way to raise money for the military effort. Well, soon you might see posters saying - Do Your Part! Save a Bank!

Continue reading Come on! Buy bailout bonds!

Wells smells

Instead of a stress test, maybe we need a “smell” test for the banks. Today, Wells Fargo “surprised” Wall Street by saying it’s expecting a record profit for the first quarter. There may be logical explanations for this, but something doesn’t smell quite right.

Continue reading Wells smells

Morning Reading

The Dow is back above 8,000 this morning, mainly thanks to Wells Fargo’s news. The bank is projecting a record Q1 profit. So does this mean the big banks are finally healing? More on that later. Here are some other fun things to read:

Continue reading Morning Reading

A shadow lurks in the housing market

This is scary. The San Francisco Chronicle reports that lenders are sitting on hundreds of thousands of foreclosed homes that haven’t even been listed yet. If this “shadow inventory” hits the market, we’ll have a new definition of bottomless pit.

Continue reading A shadow lurks in the housing market

Happy faces and porn

I’ve got it! I’ve finally figured out why Wall Street took so many risks and brought down the financial system. The answer lies in a University of Michigan experiment.

Continue reading Happy faces and porn

New lows for newspapers

Things have gotten so bad in the newspaper business, a college newspaper was forced to run a full-page Haagen Dazs ad as its front page yesterday. Flip the page and there’s an editorial apologizing for it.

Continue reading New lows for newspapers

TARP at six months

The Troubled Asset Relief Program just hit the six month mark, and the watchdog panel that’s keeping an eye on the rescue has issued a progress report. The panel’s still asking the question, “What is the Treasury’s strategy?” and still not sure whether it will work.

Continue reading TARP at six months

Morning Reading

The big stories of the morning are GM preparing for bankruptcy and a merger that will create the country’s biggest homebuilder. Other things that caught my eye…

Continue reading Morning Reading

Goldman CEO speaks out

Today, one of Wall Street’s most powerful CEO’s called for well-designed regulation and new pay guidelines for financial companies. Goldman Sachs leader Lloyd Blankfein spoke to the Council of Institutional Investors. He was interrupted by two protestors holding a sign that read: We want our $$$$ back!

Continue reading Goldman CEO speaks out

The banks needed a barber, not a masseuse

The financial rescue cop, Neil Barofsky, has decided to investigate why AIG was allowed to pay banks in full to close out claims on credit default swaps. I’m sure he already knows the answer — because the government was negligent.

Continue reading The banks needed a barber, not a masseuse

Paulson's footy booty

Speaking of Oregon and the recession, our favorite former Treasury Secretary is having trouble getting what he wants in Portland. Well, what his son wants. Henry Paulson’s son, Merritt, is trying to bring a Major League Soccer team to town, using $50 million of dad’s money.

Continue reading Paulson's footy booty

Smiles in Nebraska, frowns in Oregon

Which state is best weathering the recession? The Happiness Index from MainStreet.com says Nebraska. Oregon ranks dead last.

Continue reading Smiles in Nebraska, frowns in Oregon

It's better than a smelly cab

What do you get when cross GM with Segway? A gas-guzzling pogo stick? No, the answer is a wheelchair-ish, golf carty two-wheeled electric people mover. Today, the companies will show off their PUMA vehicle. PUMA stands for Personal Urban Mobility and Accessibility.

Continue reading It's better than a smelly cab

Morning Reading

I’m channeling Ron Burgandy this morning — I want to shout it from a mountaintop, but I don’t have a mountaintop, I have a blog. The top story in Scott Jagow’s world is: North Carolina trounces Michigan State. Other stuff that caught my eye…

Continue reading Morning Reading

Sex, sex, tax, tax

Could there be two words in the English language that get attention more quickly than those? But this isn’t false advertising. I’m going to tell you about a tax on sex.

Continue reading Sex, sex, tax, tax

A Directory of Wonderful Things

Yes, I stole my headline from the catch-phrase for boing boing because one of the wonderful things I’d like to point out came from that site. I just wanted to remind you, ahem, myself, that there are many wonderful things still going on in the world.

Continue reading A Directory of Wonderful Things

The Enron Death Star returns

Friday we discussed how banks were considering buying toxic assets from each other as part of the Treasury’s public-private investment plan. Marketplace PM also did a story on it. By way of follow up, I found a great column that compares this to Enron energy trading.

Continue reading The Enron Death Star returns

Short-selling and tall ponies

The short-selling of stocks will get a lot of attention this week. Wednesday, the SEC plans to make several recommendations for restricting short-selling. Selling short means borrowing stock and then selling it with the notion that its price will go down. If it does, you make money by buying it at the lower price and repaying your loan.

Continue reading Short-selling and tall ponies

Morning Reading

The merger between IBM and Sun Microsystems has collapsed, at least for now. My other picks of the morning include: What the President can learn from JetBlue, why the housing crash ruined the economy but the dot-com bust didn’t and is Facebook your daddy?

Continue reading Morning Reading

Smashing windows of capitalism

My weekly podcast, Marketplace After the Bell, is now available. It’s my challenging exercise every Friday — to try and make sense of what happened this week in business and the economy.

This was the week the windows of capitalism were smashed — literally and symbolically. But just because a few windows were broken doesn’t mean the whole house of capitalism has been foreclosed upon. There were signs quite to the contrary.

You can listen to my opening essay for this week’s podcast below and you can download the entire 15-minute After the Bell here or go directly to the iTunes page here.

Such a shell game

Banks are considering buying toxic assets from each other, the Financial Times reports. They would do this under the Treasury’s public-private plan to get the assets off bank books. In a world that makes less sense every day, this takes the nonsensical cake.

Continue reading Such a shell game

More stimulus?

With the job numbers out today, there’s talk in the blogosphere about the need for much more job-creating stimulus. Our own commentator, Robert Reich, blogs that we’re in a Depression with a capital D, and the way out of it is government spending on a large scale.

Continue reading More stimulus?

Morning Reading

The unemployment rate climbed to 8.5% in March. Another 663,000 people lost their jobs. NPR helps you meet some of them. Other stories and columns of interest:

Continue reading Morning Reading

May I have your attention, PLEASE

My attention span keeps getting shor. I’m not exactly sure why that. Maybe it’s because I can watch anhourofTVin40minutes. Or ‘cause people are comm. with me in 140 char. or les. Advertisers are hatching plans to. A cup of coffee sounds good.

Continue reading May I have your attention, PLEASE

Financial journalism debated

I’m not on the radio much these days, but I did get some air time this morning on my old NPR station, WFAE in Charlotte, NC. I was a guest on Charlotte Talks with Mike Collins for a show about financial media. Did the media whiff on the implosion of subprime and Wall Street?

Continue reading Financial journalism debated

This little piggy went mark-to-market

Stocks are having a fat rally today mainly because of a change in accounting rules. The Financial Accounting Standards Board has relaxed mark-to-market so that banks can use “significant judgment” in determining the value of certain assets. Is this fairy tale accounting or a necessary bank savior?

Continue reading This little piggy went mark-to-market

Morning Reading

The unemployment line keeps getting longer. Jobless claims increased once again last week, but is it really a lagging indicator? Other stories and columns of interest this morning:

Continue reading Morning Reading

April Fool's confusion

It’s getting harder to fool on April 1st because the ridiculous doesn’t seem as ridiculous anymore, not since an insurance company took the planet hostage. One of my favorite gags of the day came from the Guardian Newspaper. The British paper announced that after 188 years, it would become the first newspaper to be published exclusively via Twitter.

Continue reading April Fool's confusion

G-20 Deja Vu

People smashing things, bloody faces, mayhem and beer. Must be another gathering of world leaders! I have pictures to show you from the G-20 protests in London, but they could just as well be stock photos from WTO 1999 in Seattle or the 2005 G8 in Scotland or any number of costly and ineffective global summits.

Continue reading G-20 Deja Vu

Where your money is going

The Obama administration seems to be hitting its stride in terms of communicating with the public. The website designed to track the government’s bailout money, financialstability.gov, is finally up and running.

Continue reading Where your money is going

Morning Reading

Facebook’s CFO gets fired, Twitter has a new plan to make money, the Earth has too many people, London plans to open an economic theme park, a college mistakenly accepts thousands of the wrong students. Those are a few of the stories for April 1st, and some of them are true.

Continue reading Morning Reading


American Public Media © |   Terms and Conditions   |   Privacy Policy