Gold: The original world currency. Things seem to run a lot smoother without the banksters running their streetwise con games creating debt, receipts and interest payments.
I'll trade $3.00 in ATM fees for a spread/delivery fee any day.
German firm plans 'Gold-to-Go' ATMs to sell tiny, pricey gold bars
Reuters
A German asset management company plans to set up 500 "Gold-to-Go" ATMs in Germany, Switzerland and Austria this year. A gold-dispensing automatic teller machine (ATM) was on display at Frankfurt's main railway station for a one-day marketing test yesterday. A one-gram piece of gold, the size of a child's little fingernail and about as thin, cost US$42.25--a 30% premium to the spot market price. The flat rectangular piece came out of the cash-only ATM in a tin box, including a certificate of authenticity. "This is more than a marketing gimmick," said Thomas Geissler, chief executive of TG-Gold-Super-Markt.de, the company planning to set up the 500 gold ATMs at a cost of ¤20,000 ($31,500) apiece. "It is an appetizer for a strategic investment in precious metals. Gold is an asset everyone should have, between 5% and 15% of your liquid assets in physical gold," he said.
Saturday, May 30, 2009
Friday, May 29, 2009
Yellow Pages Publisher Bankrupt
Another one bites the dust.
R.H. Donnelley files for bankruptcy
Big buyouts and shrinking ad revenue sinks Yellow Pages publisher
NEW YORK (MarketWatch) -- R.H. Donnelley Corp., the country's third largest print and online Yellow Pages publisher, said Friday it has filed for bankruptcy after years of growth through leveraged buyouts.
"Our growth-through-acquisition strategy never anticipated the cataclysmic collapse of the U.S. economy and the local advertising market," said David Swanson, chairman and chief executive. R.H. Donnelley said it has more than $300 million of cash on hand which, combined with projected positive cash flow, will be sufficient to fund operations during the restructuring.
Shares of Cary, N.C.-based R.H. Donnelley closed Thursday at 14 cents a share, off by 6.7%. The stock has had a tragic run, peaking at around $78 in 2007 before plunging on signs the economy was beginning to cool off.
R.H. Donnelley said it has already reached an agreement in principle with key creditors to reduce its debt by around $6.4 billion, eliminate roughly $500 million in annual interest expense and extend the company's bank maturities out to 2014.
At the end of 2008, R.H. Donnelley had more than $12 billion in total liabilities.
Since 2000, R.H. Donnelley has rung up more than $12 billion in acquisitions, including its $9 billion buyout of Dex Media, which included about $5 billion in debt. The company also purchased Sprint Directory Publishing and certain businesses of SBC Communication Inc.
Last year, the company swung to a $2.3 billion loss from a profit of $46.9 million, primarily due to non-recurring items. Total revenue came in at about $2.6 billion.
R.H. Donnelley has more than 4,400 employees and distributes its directories in nearly 30 states, serving more than 600,000 local and national advertisers.
Christopher Hinton is a reporter for MarketWatch based in New York.
R.H. Donnelley files for bankruptcy
Big buyouts and shrinking ad revenue sinks Yellow Pages publisher
NEW YORK (MarketWatch) -- R.H. Donnelley Corp., the country's third largest print and online Yellow Pages publisher, said Friday it has filed for bankruptcy after years of growth through leveraged buyouts.
"Our growth-through-acquisition strategy never anticipated the cataclysmic collapse of the U.S. economy and the local advertising market," said David Swanson, chairman and chief executive. R.H. Donnelley said it has more than $300 million of cash on hand which, combined with projected positive cash flow, will be sufficient to fund operations during the restructuring.
Shares of Cary, N.C.-based R.H. Donnelley closed Thursday at 14 cents a share, off by 6.7%. The stock has had a tragic run, peaking at around $78 in 2007 before plunging on signs the economy was beginning to cool off.
R.H. Donnelley said it has already reached an agreement in principle with key creditors to reduce its debt by around $6.4 billion, eliminate roughly $500 million in annual interest expense and extend the company's bank maturities out to 2014.
At the end of 2008, R.H. Donnelley had more than $12 billion in total liabilities.
Since 2000, R.H. Donnelley has rung up more than $12 billion in acquisitions, including its $9 billion buyout of Dex Media, which included about $5 billion in debt. The company also purchased Sprint Directory Publishing and certain businesses of SBC Communication Inc.
Last year, the company swung to a $2.3 billion loss from a profit of $46.9 million, primarily due to non-recurring items. Total revenue came in at about $2.6 billion.
R.H. Donnelley has more than 4,400 employees and distributes its directories in nearly 30 states, serving more than 600,000 local and national advertisers.
Christopher Hinton is a reporter for MarketWatch based in New York.
Retail Bankruptcies Down to the Wire?
In touring a power center recently a retail broker brought a client through an anchor space that was recently vacated by a now bankrupt national retailer. In addition to stripping the space of its merchandise and trade fixtures, the retailer or its liquidators tore out every light and inch of conduit in the entire building removing the copper and leaving the remains in a mangled heap.
A group of corporate retail veterans with more than 80 years of combined real estate experience indicated they had never seen anything like it.
Corporations and banks are getting so desperate that they are going after the only remaining stores of value in defunct retail concepts/franchises - hard assets.
This has eerie parallels to the US economy: former world franchise product no longer viable (dollar), runs out of line of credit, lights turned out, hard assets removed in the middle of the night.
A group of corporate retail veterans with more than 80 years of combined real estate experience indicated they had never seen anything like it.
Corporations and banks are getting so desperate that they are going after the only remaining stores of value in defunct retail concepts/franchises - hard assets.
This has eerie parallels to the US economy: former world franchise product no longer viable (dollar), runs out of line of credit, lights turned out, hard assets removed in the middle of the night.
Thursday, May 21, 2009
UK Debt Outlook Downgraded
Don't forget private debt and unfunded liabilities. The picture looks the same just about anywhere you go around the world save some Asian economies.
Why S&P Lowered Its U.K. Debt Outlook
Warning of a possible downgrade from the current AAA, the agency says British government debt could approach 100% of GDP by 2013
On May 21, Standard & Poor's Ratings Services revised its outlook on the United Kingdom to negative from stable. At the same time, the AAA long-term and A-1+ short-term sovereign credit ratings were affirmed.
Rating outlooks assess the potential direction of a rating, typically over a period of up to two years. An outlook does not necessarily precede a rating change.
We have revised the outlook on Britain to negative because of our view that, even assuming additional fiscal tightening, the net general government debt burden could approach 100% of gross domestic product and remain near that level in the medium term.
Erosion in Revenue Base
We base our opinion on our updated projections of general government deficits in 2009-13. These projections reflect our more cautious view of how quickly the erosion in the government's revenue base may be repaired, the extent to which the growth in government spending can be curtailed, and consequently the pace at which historically high fiscal deficits are likely to narrow. Our projections also incorporate updated estimates of the cumulative potential gross fiscal cost of government support to the banking system, which we now estimate to be in the range of £100 billion-£145 billion, or 7%–10% of 2009 estimated GDP.
Taken together, these factors could, in our opinion, result in a doubling of the general government debt burden to nearly 100% of GDP by 2013. A government debt burden of that level, if sustained, would in S&P's view be incompatible with a AAA rating.
We believe that the ratings on Britain continue to be supported by its wealthy, diversified economy; a high degree of fiscal and monetary policy flexibility; and its relatively flexible product and labor markets. However, last month's budget announcements underscored that British public finances are deteriorating rapidly—at a faster rate than S&P had previously assumed. In January 2009, for example, when we last affirmed the ratings on Britain, we assumed that the U.K. net general government debt burden would rise from about 49% of GDP in 2008 to 83% in 2013.
We note that there is support across the political spectrum for additional fiscal tightening. However, the parties' intentions will likely remain unclear until the next administration is formed after the general election, due by mid-2010. How quickly the government can stabilize and then reduce the government debt burden will also depend on the timing and shape of the economic recovery and whether the cost of government support of the banking system is higher than we currently assume, areas where we also see continued downside risks.
Outlook
The negative outlook reflects S&P's view that, in light of the challenges to strengthen the tax base and contain public expenditures, the U.K. government debt burden could approach 100% of GDP by 2013 and remain near that level thereafter. The rating could be lowered if we conclude that, following the election, the next government's fiscal consolidation plans are unlikely to put Britain's debt on a secure downward trajectory over the medium term.
Conversely, the outlook could be revised back to stable if comprehensive measures are implemented to place the public finances on a sustainable footing, or if fiscal conditions are more benign than we currently anticipate.
Why S&P Lowered Its U.K. Debt Outlook
Warning of a possible downgrade from the current AAA, the agency says British government debt could approach 100% of GDP by 2013
On May 21, Standard & Poor's Ratings Services revised its outlook on the United Kingdom to negative from stable. At the same time, the AAA long-term and A-1+ short-term sovereign credit ratings were affirmed.
Rating outlooks assess the potential direction of a rating, typically over a period of up to two years. An outlook does not necessarily precede a rating change.
We have revised the outlook on Britain to negative because of our view that, even assuming additional fiscal tightening, the net general government debt burden could approach 100% of gross domestic product and remain near that level in the medium term.
Erosion in Revenue Base
We base our opinion on our updated projections of general government deficits in 2009-13. These projections reflect our more cautious view of how quickly the erosion in the government's revenue base may be repaired, the extent to which the growth in government spending can be curtailed, and consequently the pace at which historically high fiscal deficits are likely to narrow. Our projections also incorporate updated estimates of the cumulative potential gross fiscal cost of government support to the banking system, which we now estimate to be in the range of £100 billion-£145 billion, or 7%–10% of 2009 estimated GDP.
Taken together, these factors could, in our opinion, result in a doubling of the general government debt burden to nearly 100% of GDP by 2013. A government debt burden of that level, if sustained, would in S&P's view be incompatible with a AAA rating.
We believe that the ratings on Britain continue to be supported by its wealthy, diversified economy; a high degree of fiscal and monetary policy flexibility; and its relatively flexible product and labor markets. However, last month's budget announcements underscored that British public finances are deteriorating rapidly—at a faster rate than S&P had previously assumed. In January 2009, for example, when we last affirmed the ratings on Britain, we assumed that the U.K. net general government debt burden would rise from about 49% of GDP in 2008 to 83% in 2013.
We note that there is support across the political spectrum for additional fiscal tightening. However, the parties' intentions will likely remain unclear until the next administration is formed after the general election, due by mid-2010. How quickly the government can stabilize and then reduce the government debt burden will also depend on the timing and shape of the economic recovery and whether the cost of government support of the banking system is higher than we currently assume, areas where we also see continued downside risks.
Outlook
The negative outlook reflects S&P's view that, in light of the challenges to strengthen the tax base and contain public expenditures, the U.K. government debt burden could approach 100% of GDP by 2013 and remain near that level thereafter. The rating could be lowered if we conclude that, following the election, the next government's fiscal consolidation plans are unlikely to put Britain's debt on a secure downward trajectory over the medium term.
Conversely, the outlook could be revised back to stable if comprehensive measures are implemented to place the public finances on a sustainable footing, or if fiscal conditions are more benign than we currently anticipate.
Marc Faber on Capitalism: It Could Collapse
Other than the reserve currency status of the dollar and the size of the western military industrial complex, it is difficult to see what is supporting the western economies.
Faber's forecasts have been reasonably accurate over the past few years, however, it would be difficult to call the existing system where almost 50% of all US engineers are employed by the government or a government contractor capitalism. It would be difficult to call the AIG and GM deals love children of capitalism. It would also be difficult to call artificially low interest rates controlled by a central bank employing quantitative easing the hail Mary plays of capitalism.
Marc Faber: Capitalism Could Fail
Monday, May 18, 2009 11:41 AM
By: Dan Weil Article Font Size
Investment guru Marc Faber says the financial system must be cleansed to save capitalism.
"I think the final low in markets will occur when the system is cleaned out," Faber told CNBC.
Unless that happens, "the way communism collapsed, capitalism will collapse," he says. "The best way to deal with any economic problem is to let the market work it through."
He sees the Federal Reserve and other central banks continuing to print piles of money. And the outcome won’t be pretty.
"The U.S. government for sure will go bust,” Faber says. “That I guarantee you. Not tomorrow, but it will go bust."
He isn’t optimistic for the fate of the global economy either.
“I don’t think that the global economy will recover anytime soon,” he says. “And we have to define what a recovery is.”
If economic output drops far enough, a mere revival of inventories can push growth up a bit, creating a mild rebound, Faber says.
“I take 2006 and early 2007 as the peak of prosperity in this long cycle, and I don’t think we’re going back there anytime soon.”
Many other experts share Faber’s bearish view of the global economy.
“The debate will continue on whether it’s going to be a V, U or L-shaped recession,” former World Bank president James Wolfensohn said at a recent conference.
“My own judgment is that it’s more likely the latter. I don’t believe we’ll get a quick fix any time soon.”
© 2009 Newsmax. All rights reserved.
Faber's forecasts have been reasonably accurate over the past few years, however, it would be difficult to call the existing system where almost 50% of all US engineers are employed by the government or a government contractor capitalism. It would be difficult to call the AIG and GM deals love children of capitalism. It would also be difficult to call artificially low interest rates controlled by a central bank employing quantitative easing the hail Mary plays of capitalism.
Marc Faber: Capitalism Could Fail
Monday, May 18, 2009 11:41 AM
By: Dan Weil Article Font Size
Investment guru Marc Faber says the financial system must be cleansed to save capitalism.
"I think the final low in markets will occur when the system is cleaned out," Faber told CNBC.
Unless that happens, "the way communism collapsed, capitalism will collapse," he says. "The best way to deal with any economic problem is to let the market work it through."
He sees the Federal Reserve and other central banks continuing to print piles of money. And the outcome won’t be pretty.
"The U.S. government for sure will go bust,” Faber says. “That I guarantee you. Not tomorrow, but it will go bust."
He isn’t optimistic for the fate of the global economy either.
“I don’t think that the global economy will recover anytime soon,” he says. “And we have to define what a recovery is.”
If economic output drops far enough, a mere revival of inventories can push growth up a bit, creating a mild rebound, Faber says.
“I take 2006 and early 2007 as the peak of prosperity in this long cycle, and I don’t think we’re going back there anytime soon.”
Many other experts share Faber’s bearish view of the global economy.
“The debate will continue on whether it’s going to be a V, U or L-shaped recession,” former World Bank president James Wolfensohn said at a recent conference.
“My own judgment is that it’s more likely the latter. I don’t believe we’ll get a quick fix any time soon.”
© 2009 Newsmax. All rights reserved.
Wednesday, May 20, 2009
Yuan As A Reserve Currency
The only green shoots we are seeing are the trillions of greenbacks that were swept under the carpet now poking through.
Yuan May Be Reserve Currency By 2020 - Chinese Official
BEIJING, May 20 (Reuters) - In the latest advertisement of China's currency ambitions, an official suggested on Wednesday that the yuan could make up more than 3 percent of global foreign exchange reserves by 2020.
The yuan is not convertible for purely financial purposes, ruling it out as a reserve currency for now, but China has started to carve out a bigger international role for its money.
A pilot scheme will start soon in Hong Kong to use the yuan to settle trade with selected companies in southern Guangdong province; China has signed yuan swap deals totalling 650 billion yuan ($95 billion) since December with six central banks; and on Tuesday two foreign banks said they had won permission to float yuan bonds in Hong Kong. [ID:nSHA239335]
Zhang Guangping, vice-head of the Shanghai branch of the China Banking Regulatory Commission, acknowledged that a series of conditions would have to be met for the yuan internationalisation trend to gather momentum.
China would have to gradually make the yuan convertible on the capital account; it needed a more liquid foreign exchange market; its bond markets and banking system needed to be more developed; and there had to be proper monitoring of cross-border capital flows, Zhang told a foreign exchange conference.
But, hypothetically, he said there was no reason why the yuan could not account for over three percent of global reserves by 2020, the target date for Shanghai to have evolved into an international financial centre.
That would mean the yuan displacing the Japanese yen as the fourth-largest currency in reserve portfolios, behind the pound, the euro and the dollar.
Zhang told reporters later his target was plausible, given the rapid growth of China's economy and outbound investment and its big share of world trade.
"We have the conditions to reach such a proportion," he said.
In late March, central bank governor Zhou Xiaochuan signalled China's intention to play a greater role on the global currency stage by proposing that the dollar be eventually replaced as the dominant reserve currency by a beefed-up version of the Special Drawing Right, the International Monetary Fund's unit of account. (Reporting by Langi Chiang and Simon Rabinovitch; Writing by Alan Wheatley; Editing by Jonathan Hopfner)
Yuan May Be Reserve Currency By 2020 - Chinese Official
BEIJING, May 20 (Reuters) - In the latest advertisement of China's currency ambitions, an official suggested on Wednesday that the yuan could make up more than 3 percent of global foreign exchange reserves by 2020.
The yuan
A pilot scheme will start soon in Hong Kong to use the yuan to settle trade with selected companies in southern Guangdong province; China has signed yuan swap deals totalling 650 billion yuan ($95 billion) since December with six central banks; and on Tuesday two foreign banks said they had won permission to float yuan bonds in Hong Kong. [ID:nSHA239335]
Zhang Guangping, vice-head of the Shanghai branch of the China Banking Regulatory Commission, acknowledged that a series of conditions would have to be met for the yuan internationalisation trend to gather momentum.
China would have to gradually make the yuan convertible on the capital account; it needed a more liquid foreign exchange market; its bond markets and banking system needed to be more developed; and there had to be proper monitoring of cross-border capital flows, Zhang told a foreign exchange conference.
But, hypothetically, he said there was no reason why the yuan could not account for over three percent of global reserves by 2020, the target date for Shanghai to have evolved into an international financial centre.
That would mean the yuan displacing the Japanese yen as the fourth-largest currency in reserve portfolios, behind the pound, the euro and the dollar.
Zhang told reporters later his target was plausible, given the rapid growth of China's economy and outbound investment and its big share of world trade.
"We have the conditions to reach such a proportion," he said.
In late March, central bank governor Zhou Xiaochuan signalled China's intention to play a greater role on the global currency stage by proposing that the dollar be eventually replaced as the dominant reserve currency by a beefed-up version of the Special Drawing Right, the International Monetary Fund's unit of account. (Reporting by Langi Chiang and Simon Rabinovitch; Writing by Alan Wheatley; Editing by Jonathan Hopfner)
Tuesday, May 19, 2009
Retail Collapse Nearing Free Fall
1,100 GM Dealerships to close, each averaging 50 employees. Throw that on the pile of close to 1,000 death row Chrysler dealers and you are looking at around 100,000 more jobs lost and thousands of acres of empty and in some cases, potentially environmentally challenged parcels.
Not scary enough? Consider that the signature retail industry event, the ICSC Real Estate Convention in Las Vegas is down more than 50% this year in attendance. The turnout was expected to be so (and it was) bad that the world's largest retail reit, Simon Property Group, did not even open a booth. What a difference a year makes as last year they had what seemed like acres of elaborate meeting space.
Not scary enough? Consider that the signature retail industry event, the ICSC Real Estate Convention in Las Vegas is down more than 50% this year in attendance. The turnout was expected to be so (and it was) bad that the world's largest retail reit, Simon Property Group, did not even open a booth. What a difference a year makes as last year they had what seemed like acres of elaborate meeting space.
Vegas retail development convention attendance off 50 percent
May 18, 2009 8:02 PM
LAS VEGAS — Large swaths of floor space at this year's ReCon convention, the country's most important retail development meeting, are eerily quiet.
The usually jammed corridors of the Leasing Mall, where representatives of city agencies, real estate developers, bank financiers and others hawk their wares and pitch their project ideas in search of tenants and borrowers, are comfortably empty.
"It's a lot less people than last year," said Baltimore Mayor Sheila Dixon, over a lunch of a veggie sandwich inside a conference room in the Baltimore Development Corp.’s booth.
And she's right. Attendance is down by about 50 percent from last year's record number of 50,000 participants, according to a spokeswoman from the International Council of Shopping Centers, which hosts the event each year at the Las Vegas Convention Center. Pressures from the economic downturn have forced developers to cut down on unnecessary expenses, sending only one or two staffers to ReCon instead of a half-dozen, as in years past.
Across the aisle from the BDC's booth, reps from Waterstone Capital Advisors, a Charlotte, N.C.-based boutique investment group that specializes in structured finance instruments, set up a ping-pong table, and employees hit around the ball listlessly, with no one much interested in stopping to chat.
"It's really that bad," Steve Liadis, of the company's sales team. "Our business is down 97 percent. We've gotten totally burned."
Still, the mayor said that by Monday afternoon, she had already had five meetings, all of them productive. At the top of her list is finding a buyer for Harborplace and The Gallery, two prime retail properties in the Inner Harbor owned by bankrupt mall operator General Growth Properties Inc. The mayor said there was strong potential interest from at least one buyer, but declined to say who that was, because of the deal-making process.
"We've had some very positive meetings with some real estate and retail people about some of our older shopping centers, too," Dixon added.
The city is dangling financial incentives including tax credits and community legacy grant funding to help pitch older shopping center properties in less glamorous neighborhoods, including Northwood Plaza and a shopping center in Edmonson Village. Again, Dixon said, there has been strong interest.
"You sell [these properties] based on demographics, based on what's projected to come to the area," she said. "A lot of people are interested in Baltimore. A lot of people like Baltimore."
The usually jammed corridors of the Leasing Mall, where representatives of city agencies, real estate developers, bank financiers and others hawk their wares and pitch their project ideas in search of tenants and borrowers, are comfortably empty.
"It's a lot less people than last year," said Baltimore Mayor Sheila Dixon, over a lunch of a veggie sandwich inside a conference room in the Baltimore Development Corp.’s booth.
And she's right. Attendance is down by about 50 percent from last year's record number of 50,000 participants, according to a spokeswoman from the International Council of Shopping Centers, which hosts the event each year at the Las Vegas Convention Center. Pressures from the economic downturn have forced developers to cut down on unnecessary expenses, sending only one or two staffers to ReCon instead of a half-dozen, as in years past.
Across the aisle from the BDC's booth, reps from Waterstone Capital Advisors, a Charlotte, N.C.-based boutique investment group that specializes in structured finance instruments, set up a ping-pong table, and employees hit around the ball listlessly, with no one much interested in stopping to chat.
"It's really that bad," Steve Liadis, of the company's sales team. "Our business is down 97 percent. We've gotten totally burned."
Still, the mayor said that by Monday afternoon, she had already had five meetings, all of them productive. At the top of her list is finding a buyer for Harborplace and The Gallery, two prime retail properties in the Inner Harbor owned by bankrupt mall operator General Growth Properties Inc. The mayor said there was strong potential interest from at least one buyer, but declined to say who that was, because of the deal-making process.
"We've had some very positive meetings with some real estate and retail people about some of our older shopping centers, too," Dixon added.
The city is dangling financial incentives including tax credits and community legacy grant funding to help pitch older shopping center properties in less glamorous neighborhoods, including Northwood Plaza and a shopping center in Edmonson Village. Again, Dixon said, there has been strong interest.
"You sell [these properties] based on demographics, based on what's projected to come to the area," she said. "A lot of people are interested in Baltimore. A lot of people like Baltimore."
Friday, May 15, 2009
Friday Linkfest
http://abnormalreturns.com/2009/05/15/friday-links-alpha-generation/
http://zerohedge.blogspot.com/2009/05/frontrunning-may-15.html
The visible hand of government, the ministry of truth will get you if you try and speak the truth.
http://zerohedge.blogspot.com/2009/05/mark-patterson-its-sham-banks-are.html
http://www.fundmymutualfund.com/2009/05/intriguing.html
This ones for my Dryships friends DRYS
http://bespokeinvest.typepad.com/bespoke/2009/05/baltic-dry-index-up-eleven-days-in-a-row-should-you-care.html
More CRE shenanigans- for the banks its all about the fees, always has been always will be
http://zerohedge.blogspot.com/2009/05/credit-suisse-deemed-predatory-lender.html
TARP TALF PPIP and other acronyms demystified
http://zerohedge.blogspot.com/2009/05/putting-it-all-into-perspective.html
Apparently housing prices have hit 'rock bottom' Who'd of thunk it?
http://zerohedge.blogspot.com/2009/05/on-rock-bottom-housing-prices.html
The Jaws of Death have been closing...
http://zerohedge.blogspot.com/2009/05/frontrunning-may-15.html
The visible hand of government, the ministry of truth will get you if you try and speak the truth.
http://zerohedge.blogspot.com/2009/05/mark-patterson-its-sham-banks-are.html
http://www.fundmymutualfund.com/2009/05/intriguing.html
This ones for my Dryships friends DRYS
http://bespokeinvest.typepad.com/bespoke/2009/05/baltic-dry-index-up-eleven-days-in-a-row-should-you-care.html
More CRE shenanigans- for the banks its all about the fees, always has been always will be
http://zerohedge.blogspot.com/2009/05/credit-suisse-deemed-predatory-lender.html
TARP TALF PPIP and other acronyms demystified
http://zerohedge.blogspot.com/2009/05/putting-it-all-into-perspective.html
Apparently housing prices have hit 'rock bottom' Who'd of thunk it?
http://zerohedge.blogspot.com/2009/05/on-rock-bottom-housing-prices.html
The Jaws of Death have been closing...
Thursday, May 14, 2009
What I've been reading today
Instead of killing time watching pointless youtube videos check out some of the articles I have been reading today.
http://abnormalreturns.com/2009/05/14/thursday-links-revenue-problems/
http://www.thekirkreport.com/2009/05/bear-hunt.html
I will start posting my own links eventually but I am not feeling that ambitious right now so I will simply share others hard work with you until I do.
http://abnormalreturns.com/2009/05/14/thursday-links-revenue-problems/
http://www.thekirkreport.com/2009/05/bear-hunt.html
I will start posting my own links eventually but I am not feeling that ambitious right now so I will simply share others hard work with you until I do.
Wednesday, May 13, 2009
The Creature from Jekyll Island
Isn't it nice to know the Fed has everything under control...
Mark-to-market, how about not marking anything at all.
Mark-to-market, how about not marking anything at all.
Tip of the Iceberg
Now that many commercial real estate loans have already defaulted and the banks/lenders have taken ownership of the properties we see that conflicts of interest are beginning to arise among the lenders and borrowers- surely this is just the beginning.
http://zerohedge.blogspot.com/2009/05/deutsche-bank-is-seeking-to-destroy.html
http://zerohedge.blogspot.com/2009/05/deutsche-bank-is-seeking-to-destroy.html
Tuesday, May 12, 2009
And here - we - go
One $200 million default is roughly equal to 1,200 houses or a small town going belly up. Multiple defaults are entire cities - even metropolises. This is not a game changer but a game over for banks, pension funds, insurance companies not to mention reits, developers and brokers.
Even as banks grapple with rising foreclosures, many lenders have something else to worry about: A rising tide of potential losses from commercial real estate loans that could reach into the billions.
Worries growing about commercial real estate
Delinquency rates at hotels, office buildings have more than doubled
Even as banks grapple with rising foreclosures, many lenders have something else to worry about: A rising tide of potential losses from commercial real estate loans that could reach into the billions.
Delinquency rates and defaults on office and retail buildings and hotels have more than doubled in just six months. For apartments and industrial buildings, the rates have increased more than 80 percent, according to Reis Inc.
While homeowners are defaulting at almost four times the rate of commercial landlords, the sudden spike in late payments has many industry insiders worried about the collateral threat to the economy and financial system. Nearly $73 billion worth of commercial real estate loans are in some level of financial distress, according to Real Capital Analytics.
Read More Here: http://www.msnbc.msn.com/id/30701874
Friday, May 8, 2009
Retail Limbo Prelude to Summer of Hell
Filene's Basement is the latest national retailer to head to retail heaven joining other former power center main stays like Circuit City, Linens N' Things and Steve & Barry's. With the closing of hundreds of these stores nationally, shopping center owners are left holding the bag. Now what were once stabalized, income producing assets have become white elephants where net operating income is insufficient to cover debt payments.
With diminished net operating income, asset values are cascading downwards and wiping out mega retail owners like General Growth Properties. This trend is in the early stages of development and is sure to build up momentum and attention over the summer. Unbeknownst to many is that national retailers have escape clauses built into their leases allowing them loopholes to leave malls when anchors or similar tenants leave the center. These loopholes are known as cotenancy clauses.
Co-Tenancy Could Lead to Retail Bankruptcy
By Terry Sheridan
Blighted retail centers and vacancies are spreading faster than the swine flu hysteria and have built up a morbid, cult following at places like "Dead Malls.Com" http://www.deadmalls.com/
At the moment we are in limbo between the last phase of mega bankruptcies and the inevitable, tsunami of bad debt, negative equity and excessive inventories of "luxury goods" which are sure to smother the rest of the economy as the commercial real estate bubble's smaller, less leveraged cousin - the housing bubble has in 2007-2009.
The temperature is heating up outside and the business environment for retailers, mall owners and developers may get just a little too hot to handle.
With diminished net operating income, asset values are cascading downwards and wiping out mega retail owners like General Growth Properties. This trend is in the early stages of development and is sure to build up momentum and attention over the summer. Unbeknownst to many is that national retailers have escape clauses built into their leases allowing them loopholes to leave malls when anchors or similar tenants leave the center. These loopholes are known as cotenancy clauses.
Co-Tenancy Could Lead to Retail Bankruptcy
By Terry Sheridan
MIAMI-As the list of store closings grows exponentially so does the pain felt by landlords because of a common but little known clause in retail leases. And with bankruptcies in the retail sector expected to spread as spending remains depressed, experts say these so-called co-tenancy clauses could drive landlords into bankruptcy along with many of their tenants.
The clauses allow store owners to take several options--including not paying rent--when key tenants leave a shopping center. The clauses sometimes make leases contingent on certain anchor tenants because those big-box stores often drive most of the traffic to smaller stores. Other options triggered by co-tenancy clauses can include lease termination, reduced rent for a certain period or payment of a percentage of sales only.
Lease modifications because of co-tenancy ultimately can create a cash-flow domino effect for the landlord, says real estate lawyer Irwin Fayne, a partner at Holland & Knight, who focuses on commercial leasing. “Co-tenancy clauses are a big issue in the threat of bankruptcy to the landlord,” he says. The more vacancies that arise in a mall or shopping center, the more co-tenancy kicks in. That brings more rent reductions, and steadily decreasing cash flow for the landlord. That in turn affects the landlord’s ability to maintain the property. The lack of maintenance can violate other lease provisions. And the rundown appearance of the property discourages other prospective tenants. “It spirals downward and the trigger for filing bankruptcy is when the landlord can't make the debt service,” Fayne explains.
Read More Here: http://www.globest.com/news/1339_1339/florida/176671-1.htmlBlighted retail centers and vacancies are spreading faster than the swine flu hysteria and have built up a morbid, cult following at places like "Dead Malls.Com" http://www.deadmalls.com/
At the moment we are in limbo between the last phase of mega bankruptcies and the inevitable, tsunami of bad debt, negative equity and excessive inventories of "luxury goods" which are sure to smother the rest of the economy as the commercial real estate bubble's smaller, less leveraged cousin - the housing bubble has in 2007-2009.
The temperature is heating up outside and the business environment for retailers, mall owners and developers may get just a little too hot to handle.
Thursday, May 7, 2009
Jaws of Death
When the S&P 500 is in a strong up trend and bonds are in a strong down trend we get a situation called the Jaws of Death. The Jaws will not stay open forever and will eventually snap shut.
Let vigilance be your watchword.
Wednesday, May 6, 2009
Gerald Celente: The Collapse of 2009
If Nostradamus were alive today, he'd have a hard time keeping up with Gerald Celente. — New York Post |
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Gerald Celente, founder and chairman of the Trends Research Institute has been relied upon by millions for trends forecasting for decades being featured by the likes of CNN, Fox News and Oprah. He first came to prominence in the early 1990s for his accurate and timely prediction of the fall of the Soviet Union. Dozens of forecasts later, he is again in the spotlight for calling the "economic 9/11" in 2007, the panic of 2008 and now what he has coined the "collapse of 2009."
Mr. Celente is calling for civil unrest, banking system collapse, hyperinflation and $2,000 gold in the United States.
Sound Crazy? Maybe not when you take a harder look at the state of the American people. In a recent MetLife study it was found that half of Americans have no more than a one month cushion between losing their income stream and defaulting on their obligations.
Work Is The Linchpin Holding Together The Dream As Americans Have Little To No Financial Cushion, Half Of Workers Are Just Two Paychecks Away From Not Being Able To Pay Their Bills
New York, NY, March 9, 2009 — Work — and the paycheck and benefits associated with it — is the linchpin holding together the American dream, according to The 2009 MetLife Study of the American Dream, which was released today. A disturbing 50% of Americans say they are only one month — or only two paychecks — or less away from not being able to meet their financial obligations if they were to lose their job, and more than half of these, a startling 28% of the total respondents, couldn’t survive financially for more than two weeks. Even the “mass affluent” — those making $100,000+ in income per year — aren’t immune with more than one-quarter (29%) saying that they couldn’t meet their financial obligations for more than one month following a job loss.
If half of the American people are one pay check away from their own financial Armageddon, what then happens to the banks which own their debt, the retailers which supply them with their goods and the embattled car companies depending on their consumption? This is of course does not even go so far to speak of the human suffering. As Mr. Celente likes to say routinely, "when people lose everything, they lose it!" Well, they have been losing a lot of jobs along with pensions, retirement plans and portfolio value. Whether you are Robin hood or simply just robbin the hood, when people get desperate they do crazy things - and we expect to see a lot more of it in the near future.
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