Some of the most powerful members of the business and investing community think the American economy is going to be just fine.» Read More
Although deal volume is still running at less than half of the 2007 peak of nearly $1 trillion, M&A is making a comeback this year. A good portion of the growth has come not from the headline grabbing mega-mergers but from middle market deals ranging from $50 to $500 million, according to the independent research firm Accordion Partners.
After 20 years, Mary Meeker is leaving Morgan Stanley to join the venture capital firm Kleiner Perkins Caufield & Byers as a partner.
Meeker became known as “Queen of the Net” during the Internet mania of the late 1990s. Her Net Queen title was first intended to lionize her as a visionary. The phrase then came to symbolize something else entirely: The excesses of the dotcom bubble—and possibly the conflicts of interest inherent at investment banks during the same period. Meeker survived the waves of allegations that eventually forced analysts Jack Grubman and Henry Blodget out of the securities industry. In fact, in a fascinating and redemptive third act, the term “Queen of the Net” largely returned to its original usage — which is to say un-ironical.
It's the festive color of the holidays. It’s also what the U.S. Postal Service is seeing. Lots of red, without a bailout in sight.
Even though Cyber Monday, one of the busiest shopping days for online retailers, is expected to bring in more sales than last year, the Postal Service is not in much of a position to benefit.
"The problems are much bigger than one holiday season… The postal service needs to work on its cost structure," said Morgan Keegan Transportation Analyst Arthur Hatfield.
The Postal Service is trying to stamp out a multi-billion dollar budget shortfall. Its net loss in its fiscal year ending September 30 was $8.5 billion. Operating revenue came in at $67.1 billion - down one billion from 2009 due mainly to lower volume.
The foreclosure crisis still divides us into two camps. There are those who believe that foreclosing rapidly on homes subject to defaulted mortgages is vital to clearing the market. Others believe we should do everything we can to keep people in their homes, urging loan modifications to forestall foreclosures.
John Taylor, President and CEO of the National Community Reinvestment Coalition, falls solidly in the latter camp. Taylor would like to see widespread mortgage modifications that would allow homeowners in danger of defaulting to keep their homes. Taylor is on the board of directors of the Rainbow/PUSH Coalition and the Leadership Conference for Civil Rights. He has also served on the Consumer Advisory Council of the Federal Reserve Bank Board, The Fannie Mae Housing Impact Division as well as The Freddie Mac Housing Advisory Board. He is extremely passionate on why his idea is the right choice to help turn around the real estate market.
Ireland Gets 85 Billion Euro Package (Bloomberg) Bloomberg's lede graf provides a good index of the sentiment: "European governments sought to quell the market turmoil menacing the euro, handing Ireland an 85 billion-euro ($113 billion) aid package and diluting proposals to force bondholders to bear some cost of future bailouts."
Four words— 'sought', 'quell', 'turmoil', and 'menacing' —would seem to capture the current tone of the markets in Europe. Also, German Chancellor Angela Merkel's initial insistence on haircutting Irish bondholders would appear to have been removed. But: "The twin decisions were not enough to placate investors today that the crisis is now contained. Irish 10-year bonds erased an early advance, European stocks and the euro declined and the cost of insuring the debt of Spain and Portugal against default soared to record highs." Investors seem to believe that if you plug the hole in Ireland, the fear just migrates south and east.
Greece Bailout Repayment Timeline Extended \(CNBC via Reuters\) Greece will have an additional six years to pay back its 110 Billion Euro bailout loan to the EU and IMF. The loan, which was originally due to be repaid in 2015, has been extended to 2021. In exchange for the extension, Greece will pay another 30 basis point of interest – bringing the total rate to 5.8 percent, from an initial interest rate of 5.5 percent. The plan has been agreed to informally, with details expected to emerge after a formal agreement during the next Eurogroup and Ecofin councils on Dec 6-7.
Will Senior Bondholder of Irish Banks Take a Haircut? (Bloomberg) "European Union and International Monetary Fund officials are taking legal advice on how senior bondholders can share the cost of Ireland’s 85 billion-euro ($113 billion) bailout without triggering lawsuits, the Irish Times reported today, without saying where it got the information. Negotiators plan to finalize the aid package on Nov. 28 before markets re-open after the weekend, an EU official said on condition of anonymity." Junior bond holders have expected to come out less than whole—but analysts in Dublin long believed that senior bondholders were 'sacrosanct'. Perhaps not so, as the situation continues to deteriorate.
"China Protests U.S.-South Korea Exercises" (Wall Street Journal) Add this to the list of thorny issues between The U.S. and China:
"China made its first official protest over plans by the U.S. and South Korea to hold joint military exercises involving the aircraft carrier USS George Washington in the Yellow Sea on Sunday." The Journal article suggests the that the protests were "noticeably more restrained than when the U.S. announced similar plans," and that "The statement also appeared to offer all sides a face-saving compromise," —but still, skepticism perhaps should remain the order of the day. Have we so soon forgotten Chairman Bernanke's remarks on currency issues made just a week ago today?
"Stocks Sink as Worries over Europe's Debt Linger" (Yahoo Finance via AP)
"Stocks are sinking during a shortened session on Wall Street amid lingering uncertainty surrounding Europe's debt troubles and a warning from North Korea.European stock markets and the euro fell Friday as worries mount that Portugal will need cash from other European Union countries to help manage its debts. The Dow Jones industrial average fell 100, or 0.9 percent, to 11,086. The S&P 500 index was down 8, or 0.7 percent, to 1,190. The Nasdaq composite index fell 10, or 0.4 percent, to 2,533." The trading session will close at 1:00 p.m. today.
It's almost an open secret: American businesses are on strike.
Hiring remains staggering slow and unemployment grimly high. Business expansion is at a slow-slog. Banks aren't lending, but businesses aren't borrowing either.
Anyone paying attention to these things has heard a lot of explanations. It's Obama's fault: the threats of higher taxes, Obamacare and Dodd-Frank is creating regulatory uncertainty. Or it's the fault of Republicans and deficit hawk Democrats who are resisting calls to replace falling private sector spending with more government sector spending. Or it's the animal spirits haunting us for our past sins of excess.
But what is really going on, I think, is a refusal by businessmen to play the business cycle.
All too often the American debate about immigration seems to be about a fantasy world in which the value and economic needs of the United States will decide our immigration future.
The usual economic debate is about whether we need low-skilled workers to do "jobs Americans won't do" and high-skilled workers to do jobs Americans allegedly can't do. The values debate swirls around the vagaries of America's commitment, on the one hand, to provide a safe haven for the world's "huddled masses yearning to breathe free" and, on the other hand, the importance of America's cultural integrity to the success of our political and economic systems.
There's always been some obvious sense of unreality to all of this. In a very real sense, our immigration reality has long been out of our control entirely. Family reunification policies mean that recent immigrants control a vast portion of new immigration. The lack of effective means of border enforcement means that economic conditions beyond our southern border are far more important than whatever our policies are favored in Washington, DC.
Here's the disturbing headline statistic: Portugal, Ireland, Greece, and Spain have sucked out 93 percent of the total liquidity taken from the ECB and other central banks.
The Financial Times reports, in a disconcerting Alphaville blog post today , the sordid details. Basically, the net capital usage of eurozone member states is seriously out of whack. In fact, Alphaville has republished a data table from CreditSights that sums up the problem with and almost devastating simplicity.
Why the phrase 'devastating simplicity'?
The recent insider-trading dragnet conduct by federal authorities, in the most public way, has created a wave of fear stretching from Goldman's offices in lower Manhattan through the hedge-fund strip of Connecticut and beyond.
This is not an accident. The Justice Department and the Securities and Exchange Commission view fear as one of their best friends. They know full well that they cannot catch every violator of securities laws. Instead, they depend on the deterrent effect—which is to say, fear—to prevent violations before they occur.
But the recent terror campaign by federal regulators may be going too far. Instead of just preventing violations of securities laws, it may have a chilling effect on gathering information to aid in better investing and trading.
CNBC's Patti Domm and Jeff Cox discuss the jobs report and the current dilemma of long-term unemployment.
CNBC's Patti Domm and Jeff Cox discuss the recent GDP numbers and what factors have been affecting it.
Investors give and investors take away, and nowhere has that been more true lately than in value stocks.
Bank of America asked a federal judge to throw out a verdict finding it liable for fraud over defective mortgages sold by its Countrywide unit.
An influential U.S. financial services industry group is downplaying concerns about possible breaches at JPMorgan Chase and other banks.
Since 1950, September is the worst performing month for the S&P 500 index.