Metropolis Opinion

Recession in American has attacked Goodyear Tire and Rubber. Official announced that they will close their 92 store and cut around 600 employers as balance sheet shows bad result in Goodyear Tire and Rubber.

Official has spoken that in currently recession, Americans reduce their frequency in road, put their vehicles in garage because of flying premium price in America. Of course, low of vehicles demand positive correlation with Tire and Rubber, so demand for our tire and rubber also attacked with the result, Keith Price said, as report by Reuters yesterday.

Biggest Sales Tire and Rubber Company in America has 742 store spread in United States. Closing 92 stores after tax payment settlement around $ 30 million will be done in next 3^rd quarter. The close also has the goal, to reduce $9 million loss each year, official report.

Keith Price statement on yesterday is opposed with their statement on July that Goodyear Tire and Rubber said that they have high performance to challenge successful short run in recession, especially in North America. Goodyear also reported that net income in second quarter increase $31 million or goes to 31 cent per share from $56 million or 26 cent in the beginning of the year. Full Article »

Although Lorilland Inc sales edged up from 1.05 million last year to $1.07 million this year, second quarterly report shows that their profit declined to $217 million from $239 million earlier year or declined on share $1.25 per share in the present compared with $1.37 per share last year.

Declined on their quarterly report are caused of two main reason, increasing on income sales and spin off from Loews Corporation. Income tax rate rose to 39.2 percent from 37.3 percent in year earlier.

MetLife Inc. reports second-quarter financial results on Tuesday after the market closes. The following is a summary of key developments and analyst opinion related to the period.

OVERVIEW: Turbulent markets and the plummeting dollar pummeled MetLife’s investment portfolio in the first quarter, shrinking the New York’s insurer’s profit by 37 percent.

The company’s car and home insurance division’s profit also fell during the first quarter because of more claims from insured damage. During the recent quarter, MetLife made some market moves, with a subsidiary of the insurance giant saying it will buy the residential mortgage business of a unit of First Horizon National Corp. for an undisclosed amount.

MetLife also announced plans to sell its 52 percent stake in Reinsurance Group of America Inc. to MetLife shareholders. Both transactions are expected to close in the third quarter.

BY THE NUMBERS: Analysts, on average, expect MetLife to earn $1.51 per share during the second quarter on revenue of $13.89 billion, according to a survey by Thomson Financial.

ANALYST TAKE: Friedman, Billings, Ramsey & Co. analyst Randy Binner said uncertainties surrounding credit and market exposures remain in the insurance industry. Generally speaking, “Market sensitivities will again affect insurance operating results, although to a lesser extent than in the first quarter,” he wrote in a research note.

WHAT’S AHEAD: MetLife continues to push itself into the mortgage business. Its deal with First Horizon includes all of First Horizon’s origination business outside of the bank’s home state of Tennessee, servicing some $20 billion in mortgages. More than 230 retail and wholesale offices across the U.S. will be transferred. Full Article »

Today, oil makes its new record again. Oil runs to $120 per barrel. The main factors behind the new record are USD weak against Euro and Sabotage in Nigeria. If we look back, when governments worried when Oil ran close to $100 per barrel then $108 per barrel, some day before $112 per barrel and $118 per barrel, and hold at $120 per barrel today.

Some week ago, we got good news from Brasilia that they have found the new oil mine. The new oil mine can supply more then 20 percent of OPEC supply. The new made oil price declined to $112 per barrel. Now bad news comes.

Why oil price is too sensitive? When Oil Price was running high and high, the factors didn’t come from the supply, but Stock Exchange did. Investor took profit; Dollar was declined against Euro and some major currencies.

Why Dollar is too sensitive to make Oil Price fluctuating? Why we still use Dollar as Oil Price? Why not Euro or Japan Yen?

The question had been asked to my lecture in university. Why we still use Dollar as the measurement of Oil Price? I said. Actually I didn’t get best answer from him? I read the television; some analysts said that the main factor why we still use USD as Oil Price is because Dollar is transparent and more fluctuating currency if we combined with others.

I wish my confused cleared. If readers know the answer, please tell me. Full Article »

How businesses, economic and financial flow today?Let us see and analysis ourselves before some crucial decision are taken.

Reuter; Before the Bell wrote:

Treasury set to announce regulatory overhaul

March 31, 2008 07:53 AM ET

WASHINGTON (Reuters) - Treasury Secretary Henry Paulson will reveal in full sweeping new plans on Monday for streamlining a hodgepodge of regulation faulted for permitting the U.S. mortgage crisis to balloon into a full-blown economic threat.

In my opinion, the mortgages problem in USA has been taken by their authority. In economic perfective, TIME LAG is uncertain time, short time or long run. no body knows. Market always find itself on equilibrium.  Government (legal authority) has permitted and allow million dollar to solve this problem, in the short run the impact wasn’t worked. Let equilibrium find its self. Full Article »

Thank You Mr. Fed for your intervention on market failure; Cut the interest and allowed home loans

Adam Smith said No Intervention Please from Government! Market will be equilibrium again by Invisible Hand. Hello Mr. Smith, Who is the Mr. Invisible Hand? One I ask to Adam Smith, George Soros doesn’t believe to Invisible Hand. He doesn’t believe to free fight enterprise, free competition. He doesn’t believe that the miracle of invisible hand come from France Language.

Who is Mr. Invisible Hand? Market, demand and supply? No, John Maynard Keynes didn’t believe that. So who is the Mr. Invisible Hand? Christianity Thought said that business is evil, so businessmen must be cleaned by charity.

When market gone failure in 1930 an, Invisible hand didn’t come. Invisible hand is not real. So who replace Mr. Invisible Hand? Government? Yes Government is Mr. Invisible Hand. He came in the big recession.

Now, he came back, Government (Central Bank of course) back to clear all market failure. Fed has done it in near. When American Economy gone crazy, world economy also gone failure. American economy is the leader, and we (others economy is only follow) are behind. Fed back again after in January fed cut the interest rate. Fed backs again to stabilize American economy so we can breathe again. Through What Fed stabilizes American economy?

Let us see the failure first so we can analysis and suggest what is fed tool?

World turn to recession, high unemployment, and business doesn’t work well; flying oil price, stock declined significantly, Politic problem in Tokyo, Recession in property credit in United States and many more problems caused market failure.

In America, The most problem is Business Property; specifically failure in Home loans crash. Fed come likes Jesus and allowed millions dollar to help. Stabilize, and refresh American problem.

More detail about those cases, market failure, read related post below.

An additional opinion, Market Failure in American is also caused by Mr. Bush because he make his American economy as second target, otherwise Iraq is his first target so my predict the next American president comes from Republicans.

 Recommendation Post:

 FED cuts interest again on NYtimes.com

The reduction of the benchmark interest rate to 2.25 percent was less than investors had been hoping for, though it was one of the deepest in Fed history

The Fed cut the fed funds rate by 3/4 point to 2.25%. Ron Insana, of Insana Capital Partners, and CNBC’s Erin Burnett, Steve Liesman, Bob Pisani and Rick Santelli share their analysis. Read full article on CNBC news.

Bond gurus Bill Gross, of PIMCO, and Ken Volpert, of Vanguard, react to the Fed’s decision to cut a key rate by 3/4 point.

Fed cuts key interest rate on Los Angeles Times.com

By Peter G. Gosselin

In a forceful move to contain the growing credit crisis, the central bank slashes its benchmark interest rate by three-quarters of a percentage point to 2.25%.

Rate cut aims to push fearful investors to take risks

By Tom Petruno and David Colker

The Fed’s intent is to coax money from low-yielding accounts back into stocks.

 WASHINGTON/NEW YORK (Reuters) - The Federal Reserve slashed U.S. interest rates on Tuesday, boosting Wall Street, which was already higher on stronger-than-expected investment bank earnings. on reuters.com

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