Posts tagged ‘Financial’

Global Crisis has run for several months. Time lag is over and now we get the direct impact in our daily life, in supply and demand side (industry and household). Government also (as demand in other hand and as supply in other hand too). Everyone can analyst the impact, not only economists or analysts.

How to start our analyst? Which sectors who gain the global crisis impact; Supply side (read industry) or demand side (read household)? As well as J.B. Say statement ‘Supply Creates its own demand’, I do like him. Supply side gains the bad impact first! Macroeconomic has its explanation, microeconomic also has and monetary sector also has itself explanation to describe this phenomena. Global Crisis has come and attack the fundamental economic, Banking and financial institutions in America and then European (Euro Zone) and finally to all countries without exception. Banking plays very important rules in economic and we know that. As creditor, Industries get fresh money from them.

Time lag is over and it is time to see the impact. Many industries start to house (housing) their employers. America as the source of this Global Financial Crisis Virus gets worse impact; put new record on unemployment rate in last 14 years. 600.000 employers have been housed in last three months and total unemployment approximately 1, 2 million people in this year. Industries with higher labors (industry with labor based) try to cut their labor because significantly decline on demand side. Because America is main target Export from developing countries, most countries (foreign industries) also gain bad impact because demand in America showing fantastic declining. After America, Demand in Euro Zone is also low. Once demand is low, business (with export based) do nothing because no buyer. To housing some of their labor is right decision. Both labor and businessmen also gain, labor is potentially housed and businessmen are potentially collapsed. Read more »

I’ll start with the good news.

The largest bank failure in the history of the U.S. was handled smoothly by the teamwork of the government and the private sector. The system worked!

Let’s explore this a bit further: Since the 1930s, depositors in commercial banks, savings banks and credit unions have been protected by government deposit insurance. Beginning in 1980, the insured amount has been $100,000 (although only the effort and bother prevents anyone from spreading any larger amount across two or more banks). The Federal Deposit Insurance Corporation covers banks; a separate agency covers credit unions.

When a bank is insolvent–when its assets don’t cover its liabilities (which are largely deposits)–the FDIC takes control. The owners are wiped out, since their equity position is negative. Senior management is dismissed. Unsecured creditors are unprotected.

The FDIC then usually finds an acquirer–a solvent bank–to take over the deposit liabilities and the assets of the failed bank. The insured depositors are kept whole; their deposit claims are now the obligations of the acquiring bank.

If the acquirer takes all of the assets, the FDIC writes a check to the acquirer for the negative equity “hole” so that the acquirer is getting a “balanced” (assets equal liabilities) deal. In some instances the acquirer declines to take some of the assets, so the FDIC writes a bigger check and those hard-to-value assets become the property of the FDIC, which eventually liquidates them.

In the WaMu transaction, JPMorgan Chase (nyse: JPM – news – people ) won the auction that the FDIC held among potential acquirers earlier in the week. JPMorgan Chase assumed all of WaMu’s deposit obligations–uninsured as well as insured. These deposits totaled about $188 billion. It also absorbed all of WaMu’s net assets, which were mostly residential mortgages and mortgage-backed securities. Some of WaMu’s assets had been pledged to secured creditors (such as the Federal Home Loan Bank System, which lent WaMu around $60 billion) who could immediately grab collateral that satisfied their claims. The net assets acquired by JPMorgan Chase had a nominal value of around $240 billion. Implicitly, there was also “brand name” value that JPMorgan Chase acquired, since WaMu had an extensive branch network and a good reputation in many states where JPMorgan was absent but longed to expand.

In this resolution, the FDIC didn’t pay anything to induce JPMorgan Chase to absorb WaMu. Indeed, JPMorgan Chase paid the FDIC $1.9 billion.

So, the good news is that the system of deposit insurance worked smoothly, as did the FDIC resolution of a large troubled bank. There was only a small “run” of depositors withdrawing their money from WaMu branches earlier in the week. The FDIC moved in Thursday night, rather than waiting until Friday night (as it usually does). It probably feared that the depositor run would get worse on Friday, and it didn’t want images of depositor lines outside WaMu branches in newspapers, newscasts and Web sites over the weekend. Read more »

Recently news shown us that financial institution and American economy indicated declined for new record after great recession. We also worry about the news, about financial situation, because if once done, where we find our back up, lender for our last resource to back up our financial condition. Americans are now down to worry because of fantastic credit problem (bad credit) sits near 700 million USD. Economist and Businessmen will say if there are no angels and invisible hands, second great recession comes again storming us.

Banks become more restrict to accept our loan, they want more and detail profile approval requirements to secure their balance and credit problems, although they want unemployed money in the bank goes to borrower so they get price of money. But FED rules must be followed.

This care results complicated because we (borrowers) have no job, recession business, inflation by supply push. Many lenders are now in near. They are third party connector for Lenders (read Banks), to meet Borrower and Creditor in Loan Market.

For us, Fluctuation on financial market scares and makes stand by to find our new loan if something worst happened such as cutting interest rate by FED, inflation, fired or family financial problems. If you have those problems about your loan problems, have no good reputation in Credit Score or You have some loans and try to find new loan from lenders. Lenders will think twice because you have no ability to payback.

This process, problems and complicated are cut by the brilliant idea from Easy payday loans. They replace your interviews session with Bank HRD. With free loan qualification, let they analysis about you and your track records in financial history.

Payday Loans is preferred because easy requirement and certain payback period. We need payday loans once we are in the end of months, where financial condition is in the valley. Payday loans have their own market segment. Most of borrowers come from labor and asking payday loans to keep them in the end of months. Today, Payday Loans run to perfect competition for lenders to get the costumers. The end surplus consumer gets higher because supplier cut their own surplus in order to get costumers.

Most requirements are now cut by lender to improve and to get market segment; No Collateral, No Credit Report (Credit History), Online Application Approval, Approval in 24 hours after you send your approval. Lenders only need Bank Account to transfer the loan, Active Job status (Payday Loans means Loans for Employment) to check your authority that you are worker. There are no difficult requirement systems for us to payday loans in the present.

We have good news from my Uncle Sam, America. Time lag had been working for 1 month, when LA Times sent me good news that Interest rate cutting by FED has show his magic. I think worldwide economic will be impacted and reaction to better condition. LA Times told on the report that credit problem return go nice.
What does it mean? When fall into Bad Credit, Number of dollar to payback their credit has arisen, now, people have ability to payback because of lower interest rate.

Understanding people must know that correlation between interest and ability to payback their credit or loan. Lower interest rate, makes people turn to invest their money or create a job. Lower interest rate also makes dollar to payback will lower than before.

When American economic goes better, oil price will meet new equilibrium, lower than before and my prediction, oil price will turn down and down, maybe stop and stabile around $ 90-100 USD per barrel.
While Uncle Sam Economic goes healthy, banks and loan company treasure and stock will be appreciated on stock market. Dollar is also appreciated in exchange market.
New equilibrium doesn’t mean that the price and dollar in exchange market will meet to previous equilibrium. New equilibrium will lower than the highest but upper than before equilibrium.
I do sure; oil price will turn significantly in recent days. Let us see our prediction.

The Biggest US Bank, Citigroup Bank is hurt by Credit Loses. But the new chief executives, Vikram Pandit, outside analysts are showing their optimism that Citigroup can change face and handle those problems in loans in future.
Based on their report, Citigroup suffers more than $16 billion. Main factor is credit and loans case. The impact goes to labor. An internal staff said that they will cut another 9,000 jobs.

Their New Executive said, “We’re not happy with our financial results this quarter,” Pandit said on a conference call. Nevertheless, he said his confidence in Citigroup’s future is “extremely high.”
Many hope for Pandit, they said. So let us see Pandit’s efforts to bring Citigroup escaped from the financial problems. Pandit said that in the beginning they focus on internal costs, like cut employees, credit repair, and they also focus on a new plan, sell Diners Club International.
Follow this link to read full article from Citigroup.
Source Reuters.com

New York Times wrote;
French Company Is Said to Buy Maker of Absolute Vodka
By ANDREW ROSS SORKIN
Pernod Ricard and Vin & Sprit, the parent company of Absolute Vodka, are expected to announce the transaction, which may be worth more than $7 billion, on Monday.
Doubt Cast on 2 Drugs Used to Lower Cholesterol
By ALEX BERENSON
The drugs Vytorin and Zetia may not work and should be used only as a last resort, The New England Journal of Medicine and a panel of cardiologists at a major cardiology conference said on Sunday.
A Nervous Wall St. Seems Unsure what’s next?
By JULIE CRESWELL
Most everyone wants to know when the financial crisis will end. So far the markets are whispering an answer that no one wants to hear.
To read full article, follow this link