Blog Entries for HJohnson

Volcker Fights On

hilaryaj@gmail.com — Sun, 13 Dec 2009 23:00:00 +0100

Paul Volcker sounds like he's getting more and more fed up, no pun intended.

The former Federal Reserve chairman and current head of President Obama's Economic Recovery Advisory Board told a group of bankers and other company and public sector execs last week, "Wake up, gentlemen."

Today, we were able to read a full account of his comments in the Wall Street Journal, nuggets of which had already been on the blogs last week.

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Corporate credit will draw investors next year, Barclays says

hilaryaj@gmail.com — Thu, 03 Dec 2009 23:00:00 +0100

As credit markets continue to normalize next year, corporate credit will be seen as one of the most attractive investments, Barclays Capital wrote in a note Friday.

Investors will favor corporate bonds because they will see few comparable alternatives with as much return potential, since economic growth is slow around the world, currency yields are low and there's a generous supply of long-dated treasuries.

"Within broader spread products, corporate [...]

Special dividends will hit record next year, tax expert says

hilaryaj@gmail.com — Mon, 30 Nov 2009 23:00:00 +0100

A record number of companies will issue special dividends next year as they prepare for Bush-era dividend tax rates to expire, tax expert Robert Willens told Barrons.com.

"I am looking for absolutely a record and it will probably pick up steam as the year unfolds and probably in the fourth quarter of 2010 as these predictions we are making about higher-tax rates come to fruition," Willens, president of Robert Willens LLC, said in a Q&A on the Barrons.com site. ( [...]

CIOs growing more confident about hiring next year

hilaryaj@gmail.com — Mon, 30 Nov 2009 23:00:00 +0100

The first quarter of next year will see the strongest IT hiring in a year in the U.S., according to staffing firm Robert Half. Seven percent of chief information officers surveyed said that they will add staff, while 4 percent expect to reduce headcount, a net result that's three points higher than last quarter, according to Robert Half Technology's IT Hiring Index and Skills Report.

It's also the most optimistic forecast since the first quarter of 2009, Robert Ha [...]

Buzzword Bingo

hilaryaj@gmail.com — Tue, 24 Nov 2009 23:00:00 +0100

Quick, what's the business buzzword we're likely to hear most often next year, as we continue to work ourselves out of the recession?

Is it "exit strategy," "deleveraging," "new normal"?

There's a case for each of these, the Economist suggests in one of the pieces in its "The World in 2010" issue.

"Exit strategy" will definitely be big, since every government that has supported its economy with [...]

Bernanke talks strong dollar, traders don’t listen

hilaryaj@gmail.com — Sun, 15 Nov 2009 23:00:00 +0100

The dollar fell to a 15-month low on Monday, according to Bloomberg, despite Federal Reserve Chairman Ben Bernanke's assurances that the central bank wants the currency to be strong.

Bernanke told the Economic Club of New York: "We are attentive to the implications of changes in the value of the dollar and will continue to formulate policy to guard against risks to our dual mandate to foster both maximum employment and price stability. Our commitment to our du [...]

FDIC’s Bair says TARP was a Mistake

hilaryaj@gmail.com — Thu, 12 Nov 2009 23:00:00 +0100

You might want to tune in Friday night to the NewsHour on PBS to hear Sheila Bair of the FDIC gnash her teeth about the banking bailout mess.

Turns out, the Federal Deposit Insurance Corp. Chairman thinks TARP capital investments never should have happened. She told NewsHour correspondent Paul Solmon, according to the Wall Street Journal's website, that TARP had "a terrible, terrible impact on public attitudes towards the financial systems, towards the regulat [...]

Wells and B of A Bucked MBS Trend

hilaryaj@gmail.com — Thu, 12 Nov 2009 23:00:00 +0100

Wells Fargo and Bank of America were busy dumping mortgage back securities in the third quarter, data from the National Information Center show, even as some of their competitors, and the government, were still buying the stuff.

B of A shed $13.4 billion worth of agency and non agency MBS, according to a Barclays Capital published late yesterday, and Wells Fargo dropped $29.2 billion.

Though some B of A [...]

FIRA of the Unknown

hilaryaj@gmail.com — Mon, 09 Nov 2009 23:00:00 +0100

You know that phrase about the devil you know being better than the devil you don’t?

Senator Chris Dodd is putting a lot of faith in a new single regulator, the Financial Institutions Regulatory Administration, imagining that that agency will be better than the Federal Reserve in regulating banks and bank holding companies.

But, as Joseph Mason, pointed out in an e-mail today, it will be difficult and ill [...]

Temp to Perm?

hilaryaj@gmail.com — Thu, 05 Nov 2009 23:00:00 +0100

Overall, it's not a happy jobs day. The unemployment rate rose to 10.2% last month, more than economists expected and the highest level in more than 26 years. Employers also cut more jobs than economists expected: 190,000 compared with forecasts of 175,000.

But one piece of good news, that the White House pointed out, and temp firms themselves are touting, is that the number of temporary jobs increased by 33,700. And that's the first increase since late 2006, a [...]

Buffett: Bull or Bear?

hilaryaj@gmail.com — Wed, 04 Nov 2009 23:00:00 +0100

Warren Buffett's huge bet on Burlington Northern Santa Fe is proving to be kind of like a Rorschach test. People see in it what they want to see.

Is the acquisition, the biggest ever for Buffett: a) a big "Booyah" on the U.S. economy? b) the biggest and most expensive mistake that Buffett ever made? c) a way to make Berkshire Hathaway more diversified, more like a traditional conglomerate, and better for a non "seer" CEO to oversee? (as Liam Den [...]

And Citi Says??

hilaryaj@gmail.com — Sun, 01 Nov 2009 23:00:00 +0100

Citigroup's public relations department must be having a whale of a day, but why isn't there any evidence of it?

Not only did Andrew Martin and Gretchen Morgenson publish a probing piece yesterday in the New York Times, which included this quote from Chris Whalen, managing director of Institutional Risk Analytics, "I continue to believe the equity is worth zero and that the company will have to go to bondholders for some kind of money to make the bank stab [...]

Home for the Holidays

hilaryaj@gmail.com — Tue, 27 Oct 2009 23:00:00 +0100

To heck with "It's better to give than receive."

While consumers may be more optimistic about the economy, and may start to spend more on themselves and their homes this holiday season, they're still not ready to be as generous with others, according to consulting firm Deloitte.

The average number of gifts that consumers plan to buy fell to about 18, from about 21 last year, Deloitte said in a press release Oct. 28. As well, consumers plan t [...]

We're Not Gonna Take It

hilaryaj@gmail.com — Tue, 27 Oct 2009 23:00:00 +0100

Judging from responses to the Wall Street Journal's report that the government is about to help GMAC out again to the tune of $2.8 billion, the worm, or, er, taxpayer, has finally turned.

Judging from responses to the Journal's article, and other responses to articles and blogs, everyone seems to be singing that catchy Quiet Riot song, "We're Not Gonna Take It."

Of course, it's likely to fall on deaf ears in Washington, but some folk [...]

Why Will Buy?

hilaryaj@gmail.com — Thu, 22 Oct 2009 23:00:00 +0100

If it's Friday, it must be bank failure day. As we watch and wait for number 100 (another psychological milestone!), it's worth pausing to appreciate what a great job the FDIC has done so many weekends this year, in making these failing institutions almost magically disappear. No sturm, no drang, just a little burp.

They've done such a great job, in fact, that the Fed is eyeing the system with envy. As Ben Bernanke said today in his speech in Boston:

Like some "Ifs" with those earnings?

hilaryaj@gmail.com — Wed, 21 Oct 2009 23:00:00 +0100

To Matt Quinn's point today about pernicious problems in the banking sector, Hudson City Bancorp, one of Jim Cramer's darlings, is one example.

The holding company for Hudson City Savings Bank, based in Paramus, NJ, beat Wall Street's expectations when it released earnings yesterday, and Cramer, true to form, continued to recommend the stock on his show last night, saying the company is as "good as gold."

And, indeed, Hudson City has been [...]

Foxes in the hen coop

hilaryaj@gmail.com — Wed, 14 Oct 2009 23:00:00 +0100

If Senator Richard Shelby had his druthers, Timothy Geithner would never even have been named President of the New York Fed, let alone Treasury Secretary.

According to a Bloomberg story yesterday, Senator Shelby, who’s the top Republican on the Senate Banking Committee and its former Chairman, said that bankers should no longer have a say in picking leaders of the Federal Reserve banking system. He told Bloomberg in an interview, “Any institution that is going to be involv [...]

Watching and Waiting

hilaryaj@gmail.com — Sat, 08 Aug 2009 23:00:00 +0100

Ah, Fed day! On every other day of the year, 2:15 goes by without so much as a blip. But today the Governors – or is that the Oracles? – speak.

No big surprises, though the Fed did specify an end date for its purchase of $300 billion worth of Treasuries (end of October). The officials also noted, as they did in June, “The Committee will continue to evaluate the timing and overall amounts of its purchases of securities in light of the evolving economic outlook and condi [...]

"A New Low Point"?

hilaryaj@gmail.com — Thu, 06 Aug 2009 01:00:00 +0100

Trust Rochdale banking analyst Dick Bove to take a contrarian view of the BofA/Merrill deal. On a day when the WSJ is wringing hands over how much BofA knew, and when, he comes out with this:

"The Merrill Lynch merger added to Bank of America’s earnings and helped increase its stock price. The politicians and the press are trying to get Ken Lewis fired for adding value to shareholders’ investment. In this new world where success should be punished this may b [...]

End of the world as we know it?

hilaryaj@gmail.com — Fri, 31 Jul 2009 01:00:00 +0100

As if CFOs didn’t have enough to worry about as they gauge the effects of this recession and the pace of the recovery, worldwide “regulatory chaos” may be on the horizon, according to an industry consultant, and that has the potential to further hurt bottom lines.

In addition to the regulatory turf war in Washington, which Ron Fink blogged about last week, the US, UK, and EU will all be vying to be the toughest on regulation, said Anthony J. Carfang, partner of Treas [...]