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Looks that way....eom
out @ 1.18
In SAY @ 1.02
MSGI,
Maybe he (or they) would be wise to either up the percentage or give an additional tax break to those that "would" with draw the money and put it out into the economy.
Oct 13th, 2008
"Since so many Americans will be struggling to pay the bills over the next year, I propose that we allow every family to withdraw up to 15% from their IRA or 401(k) – up to a maximum of $10,000 – without any fine or penalty throughout 2009. This will help families get through this crisis without being forced to make painful choices like selling their homes or not sending their kids to college."
"Scaling Back Campaign Promises"
Campaign Promises are only to get elected! Whats new?
bbotcs,
It does, it puts the entire burden on them by the required testing to prove so, of coarse the question is where will the man power come from to see that all adhere to the new law.
Why has this not been done at the point of entry into this country with regard to imports?
Now it is pushed onto the small business owners to correct what the government was/is inept at doing.
Job impact of the American recovery and reinvestment plan,
embargoed until 6:00 Am Saturday, January 10, 2009
http://otrans.3cdn.net/45593e8ecbd339d074_l3m6bt1te.pdf
YOUR GOVERNMENT AT WORK H.R.4040
Consumer Product Safety Improvement Act of 2008
Is Feb. 10 financial doomsday for thousands?
New law could force companies into ruin
Posted: January 08, 2009
12:13 am Eastern
By Chelsea Schilling
© 2009 WorldNetDaily
A new government regulation scheduled to take effect next month has thousands of retailers, thrift stores and small businesses worried they will be forced to permanently close their doors – and destroy their merchandise.
complete article
http://www.worldnetdaily.com/index.php?fa=PAGE.view&pageId=85542
the law
http://www.cpsc.gov/cpsia.pdf or HR 4040
Senate version of a bill allowing "cramdowns"
when bankruptcy judges force lenders to modify mortgages
January 8, 2009 -- 5:19 p.m. EST
___________________________________
Citigroup Inc. signed on to a deal with top Democrats in the Senate to move forward with a measure that would allow judges to set new repayment terms for millions of mortgage holders who wind up in bankruptcy court, senators involved said.
The accord on the Senate version of a bill allowing "cramdowns," when bankruptcy judges force lenders to modify mortgages, was negotiated by Sen. Dick Durbin, the Senate's second-ranking Democrat and the author of the Senate bill. Sen. Durbin, who has backed pro-consumer bankruptcy initiatives for years, has worked for more than a year on the cramdown bill.
The deal, Senate staffers said, is likely the first of several measures being crafted this year that propose to trim the principal owed by homeowners saddled with mortgages larger than the current value of their house. It marks a surprising change of direction by the financial-services industry. Banks have consistently fought such legislation, saying cramdowns would raise borrowing costs for all home buyers and jam courts with homeowners who wouldn't otherwise declare bankruptcy.
Long article...........
http://online.wsj.com/article/SB123144562914865337.html?mod=djemTAR
So much for True Love, Obama vs. Democrats
Democrats criticize Obama's proposed tax cuts
By STEPHEN OHLEMACHER, Associated Press Writer Stephen Ohlemacher, Associated Press Writer – 10 mins ago
WASHINGTON – President-elect Barack Obama's proposed tax cuts ran into opposition Thursday from senators in his own party who said they wouldn't do much to stimulate the economy or create jobs. Senators from both parties agreed that Congress should do something to stimulate the economy. But Democratic senators emerging from a private meeting of the Senate Finance Committee criticized business and individual tax cuts in Obama's stimulus plan.
They were especially critical of a proposed $3,000 tax credit for companies that hire or retrain workers.
"If I'm a business person, it's unlikely if you give me a several-thousand-dollar credit that I'm going to hire people if I can't sell the products they're producing," said Sen. Kent Conrad, D-N.D., a member of the committee.
"That to me is just misdirected," Conrad said.
Sen John Kerry, D-Mass., said, "I'd rather spend the money on the infrastructure, on direct investment, on energy conversion, on other kinds of things that much more directly, much more rapidly and much more certainly create a real job."
The cost of the economic rescue package Obama wants is expected to swell to $800 billion or more. About $300 billion of Obama's package would be for tax cuts or refunds for individuals and businesses.
One tax provision would provide a $500 tax cut for most workers and $1,000 for couples, at a cost of about $140 billion to $150 billion over two years. The individual tax cuts may be awarded through withholding less from worker paychecks, effectively making them about $10 to $20 larger each week.
Sen. Ron Wyden, D-Ore., said he doubted that a modest tax cut would change consumers' spending habits.
"In tough times people don't respond all that well to marginal changes, such as a small amount of money added per paycheck," Wyden said.
Democratic Sen. Max Baucus of Montana, chairman of the Finance Committee, said he hopes to schedule a committee vote on the stimulus package in about two weeks, which would coincide with the week of Obama's inauguration. Many senators still hope to approve a package by mid-February.
There is "general agreement that because of the recession we've got to move, we've got to move quickly, very quickly," Baucus said.
He added that it is too early to pass judgment on any aspect of Obama's plan.
"This is an early part of this whole process. A lot of preliminary questions are going to be asked," Baucus said.
___
Yep, I was out 12/31, --"satyam" means truth in Sanskrit (classical language of India)
The chairman of one of India's largest information technology companies admitted he concocted key financial results including a fictitious cash balance of more than $1 billion, a revelation that sent shock waves across corporate India and is likely to prompt investors to question the validity of corporate results as the once-hot economy slows.
B. Ramalinga Raju, founder and chairman of Satyam Computer Services Ltd.--"satyam" means truth in Sanskrit--said in a letter of resignation that he also overstated profits for the past several years, overstated the amount of debt owed to the company and understated its liabilities. Eventually, he said, the ...
http://investorshub.advfn.com/boards/read_msg.aspx?message_id=34497782
lentinman,
The correlation, if any, may remain one of the unknowns in the universe!!
I have added the usd index to this chart.
Also you will see (hopefully) that the (days) is set at 200, instead of dragging the days time line out, put your cursor on the 200 days and while holding down on either mouse button you can drag the days time frame back and forth from Feb of 99 to Dec 08.
http://stockcharts.com/charts/performance/perf.html?$indu,$wtic,$gold,$usd
lentinman,
My wife normally does our grocery shopping at Wal-Mart around 6:00 pm on her way home from work. The reasons being to save a trip and because it is dinner time and the store was not as busy. Not so since about mid year, it is just as busy at 6 as it is at 2 in the afternoon. She has also remarked that she has seen folks in there that she never knew of them to shop at walmart before.
A small six store grocery company right near us closed all stores in the area two weeks before Christmas, they were also the main draw for the other little retail shops in the plaza's where they were located. As of now I have heard of no plans for others to come in and fill the void.
We know people are reducing spending, but where they are spending it will have the greatest impact on the smaller and more expensive retailers,
and the snowball will continue to grow.
And this from a 10/24/08 article about Wal-Mart (private-label items)which may explain the MIA's you spoke of.
"•Fewer name brands. Wal-Mart has seen a rise in purchases of staples instead of discretionary items. Shoppers have more then doubled purchases of private-label items, eschewing name brands. Castro-Wright said, however, that Wal-Mart has no immediate plans to change the stores' merchandise mix to take advantage of the trend."
http://www.usatoday.com/money/industries/retail/2008-10-21-walmart-sales_N.htm
Interactive performance chart of the DOG
http://stockcharts.com/charts/performance/perf.html?$INDU,$WTIC,$GOLD
XLF....Financial Select Sector SPDR
http://finance.yahoo.com/q?d=t&s=XLF
kozuh, Pickens should have no worries, wind farms should fall right in line with the coming administrations energy policies.
It may very well turn out to be a windfall for him.
dow..10,685
oil..91.50
gold..1,145
OT: Be careful what you wish for,
A man walks into a restaurant with a full-grown ostrich behind him. The waitress asks them for their orders.
The man says, 'A hamburger, fries and a coke,' and turns to the ostrich, 'What's yours?'
'I'll have the same,' says the ostrich.
A short time later the waitress returns with the order 'That will be $9.40 please,' and the man reaches into his pocket and pulls out the exact change for payment.
The next day, the man and the ostrich come again and the man says, 'A hamburger, fries and a coke.'
The ostrich says, 'I'll have the same.'
Again the man reaches into his pocket and pays with exact change.
This becomes routine until the two enter again. 'The usual?' asks the waitress.
'No, this is Friday night, so I will have a steak, baked potato and a salad,' says the man.
'Same,' says the ostrich.
Shortly the waitress brings the order and says, 'That will be $32.62.'
Once again the man pulls the exact change out of his pocket and places it on the table.
The waitress cannot hold back her curiosity any longer. 'Excuse me, sir. How do you manage to always come up with the exact change in your pocket every time?'
'Well,' says the man, 'several years ago I was cleaning the attic and found an old lamp. When I rubbed it, a Genie appeared and offered me two wishes. My first wish was that if I ever had to pay for anything, I would just put my hand in my pocket an d the right amount of money would always be there.'
'That's brilliant!' says the waitress. 'Most people would ask for a million dollars or something, but you'll always be as rich as you want for as long as you live!'
'That's right. Whether it's a gallon of milk or a Rolls Royce, the exact money is always there,' says the man.
The waitress asks, 'What's with the ostrich?'
The man sighs, pauses and answers, 'My second wish was for a tall chick with a big butt and long legs who agrees with everything I say.'
Peter Schiff (still alive) on cnbc 12/29/08
part 1
Commentary On The Capital Markets
The Market Ticker
Commentary On The Capital Markets
Tuesday, December 30. 2008
by Karl Denninger
Anyone Swear An Oath To The Constitution?
Let's ask some "tough questions" here.
First, let's start with The Fed's press release "filling in the details" of their intended purchase of Fannie and Freddie (along with Ginnie) securities:
"Only fixed-rate agency MBS securities guaranteed by Fannie Mae, Freddie Mac and Ginnie Mae are eligible assets for the program."
Ok, so we claim these are the securities. Well enough, so far.
"How will purchases under the agency MBS program be financed? Purchases will be financed through the creation of additional bank reserves."
That's FedSpeak for "we're going to print the money out of thin air." In other words these purchases will be financed through taking on additional debt for which the US Taxpayer is obligated, since dollars are in fact debt and are backed by the "full faith and credit of The United States" (so it says - "This note is legal tender for all debts, public and private.")
Now what does The Constitution say about that?
"All bills for raising Revenue shall originate in the House of Representatives; but the Senate may propose or concur with Amendments as on other Bills."
What is a "revenue bill"?
Legally, it is a bill that obligates the taxpayer. This is why the TARP/EESA had to be attached to existing legislation in The Senate - it was not Constitutional for The Senate to originate that bill (the Senate CAN originate other sorts of bills) because under The Constitution all revenue bills must originate in The House. Because the EESA proposed to raise revenue (indirectly; it was a bill to spend and thus obligate the taxpayer for which revenue would have to be raised) it had to originate in The House of Representatives.
Thus the game-playing by the Senate, attaching it to an existing revenue bill (the "mental health" bill) that was languishing on The Senate floor.
Why is this important?
Because The Fed's actions - all of them that in fact are "financed through the creation of new bank reserves" - are in fact unconstitutional unless explicitly authorized by a revenue bill originating in The House.
Second, we have this little problem:
"What is the legal basis for the agency MBS purchase program?Purchases of agency MBS in the open market, under the direction of the FOMC, are permitted under section 14(b) of the Federal Reserve Act."
Only for Ginnie Mae.
The specific section referenced, 14(b) of The Federal Reserve Act, says:
"Purchase and Sale of Obligations of United States, States, Counties, etc., and of Foreign Governments
(B)
To buy and sell, at home or abroad, bonds and notes of the United States, bonds issued under the provisions of subsection (c) of section 4 of the Home Owners' Loan Act of 1933, as amended, and having maturities from date of purchase of not exceeding six months, and bills, notes, revenue bonds, and warrants with a maturity from date of purchase of not exceeding six months, issued in anticipation of the collection of taxes or in anticipation of the receipt of assured revenues by any State, county, district, political subdivision, or municipality in the continental United States, including irrigation, drainage and reclamation districts, and obligations of, or fully guaranteed as to principal and interest by, a foreign government or agency thereof, such purchases to be made in accordance with rules and regulations prescribed by the Board of Governors of the Federal Reserve System. Notwithstanding any other provision of this chapter, any bonds, notes, or other obligations which are direct obligations of the United States or which are fully guaranteed by the United States as to the principal and interest may be bought and sold without regard to maturities but only in the open market.
To buy and sell in the open market, under the direction and regulations of the Federal Open Market Committee, any obligation which is a direct obligation of, or fully guaranteed as to principal and interest by, any agency of the United States.
Now here's the problem.
(B).1 clearly does not apply. These notes have a maturity of more than six months.
(B).2 only applies to Ginnie Mae securities. How do I know? Because this is what is on the face of every Fannie and Freddie offering prospectus:
Every single prospectus for the various MBS and other offerings of Fannie and Freddie through the years - all of them - contain this language on the face of the prospectus.
This is what is on the face of a Ginnie Mae prospectus:
Any questions?
Fannie and Freddie, even in conservatorship, are still publicly traded companies. Henry Paulson, Secretary of the Treasury, has been asked multiple times if these securities have been "converted" to "Full Faith and Credit" and he has refused to answer in the affirmative.
Without some sort of enabling legislation (remember, Revenue Bills must originate in the house, and this would be the GrandPappy of all such bills, since the debt taken on would total five trillion dollars all at once), Fannie and Freddie debt cannot be converted to "Full Faith and Credit."
Period.
This fact is why these securities trade at a significant spread to Treasuries; ergo, they are not full faith and credit obligations.
Paulson knows this, which is why despite repeated attempts he has refused to answer in the affirmative. He'd love to say yes - but he can't and he knows it.
In fact, this is what Freddie's web page says directly to this point:
6) Is Freddie Mac a government agency?
No. Freddie Mac was chartered by Congress as a private company serving a public purpose. On September 6, 2008, the Director of the Federal Housing Finance Agency (FHFA), appointed FHFA as conservator of Freddie Mac. As conservator, FHFA has all rights, titles, powers, and privileges of Freddie Mac, and of any stockholder, officer, or director of Freddie Mac with respect to Freddie Mac and its assets; and title to the books, records and assets of Freddie Mac. In connection with the appointment of FHFA as conservator, Freddie Mac and the U.S. Department of the Treasury have entered into a Senior Preferred Stock Purchase Agreement. As part of the agreement, Freddie Mac has issued $1 billion aggregate liquidation preference of senior preferred stock to Treasury, together with a warrant for the purchase of common stock representing 79.9% of Freddie Mac's common stock."
Ginnie Mae securities trade with much less of a spread; this is because they are issued with the full faith and credit of The United States behind them.
Again, the difference is clearly disclosed on the face page of the prospectus of all of the securities issued by each of these firms in accordance with securities laws of The United States.
Therefore, it appears to me that under the plain facts of the Statute and the US Constitution the actions that The Federal Reserve announced today are unlawful, constituting a direct violation of both statutory law and The United States Constitution, and that Congress and The Justice Department, both of whom are aware of these facts, are intentionally refusing to enforce both the Statute of The Federal Reserve Act and The Constitution.
This action is not of minor importance and the amount of money involved is not "de-minimus." $500 billion dollars is approximately one sixth of the entire FY2008 Federal Budget and has been effectively expropriated without an act of Congressional authorization originating in The House.
I ask again:
Is there a Federal Prosecutor who still believes in The Constitution and Rule of Law who will go after this issue, and if not, is there any other person or group of persons who has sworn an oath to uphold The United States Constitution left in this nation who will actually discharge that obligation?
If so when will Chairman Bernanke be removed from office and these decisions reversed?
(PS: I doubt that such a person or group of persons still exist in America, despite what they may say - but I had to ask)
Out of SAY @ 9.02 both lots,
thanks for bringing it up Patty
ninja,
Our sincerest condolences to you and yours.
Regulatory Fraud-by-Idiocy, Example #9463
The Market Ticker
Commentary On The Capital Markets
Tuesday, December 30. 2008
by Karl Denninger
Regulatory Fraud-by-Idiocy, Example #9463
For this year.
"The company said it won’t finance “higher-risk transactions,” instead concentrating on prime customers who are more likely to repay using “responsible credit standards.” The relaxed policy “will allow us to return to more normal levels of financing volume, and should help in efforts to stabilize the U.S. auto industry,” GMAC President Bill Muir said in today’s statement."
Ok.
What constitutes a "prime" customer? This means that only the best credit risks will get financed at a reasonable rate, right?
Uh, no.
GMAC reduced the credit score necessary to get a loan from 700 (very good) to 621 (not very good.)
The median (average) FICO score in the United States is (according to myfico.com) 723. That makes 621 quite crappy.
Worse, here was what GMAC did:
"Within hours, GM was offering no-interest loans for as long as five years to counter this year’s 22 percent drop in sales, caused in part by the inability of its customers to get financing."
Oh, and the terms?
"GMAC will pay an 8 percent dividend on the Treasury’s $5 billion of senior preferred equity. The company will also issue warrants in the form of additional preferred equity that will equal 5 percent of the preferred-stock purchase and pay a 9 percent dividend if exercised."
So let me see if I understand this.
The government "buys" preferred equity that pays an 8% coupon. GMAC must pay that 8% coupon (9% if the government exercises the warrants)
GMAC turns around and loans out money at 0% which it has to pay 8% to acquire, and at the same time decides that it will make loans to people with credit scores significantly worse than average, when before they would make loans only to people with scores that were slightly better than average.
And we wonder how we got into this mess?
Loaning money out at a lower rate of return than it costs you to acquire - isn't that kind of like "we'll lose something on each sale, but make it up on volume?"
Oh, and then while we're at it, let's make lots of loans to people who have credit significantly worse than the average credit score in the United States, instead of just making loans to those who are at least average in their handling of credit.
The Federal Reserve approved GMAC's bank holding company application with this as the background and without constraint to prevent this intentionally-losing strategy from being conducted.
In one sentence:
The Federal Reserve and Treasury approved an application that contained as it's essence an intentional money-losing business strategy, enabling the literal looting of the public treasury under the false pretense of an "investment".
If you wonder why our nation is absolutely, totally screwed, and why we will see 2009 bring us ever-closer to an economic collapse as the pyramid of bad debt, intentionally taken on with the full knowledge and complicity of Treasury and The Federal Reserve collapses, you need look no further than this announcement.
Bernanke and the entire Federal Reserve Board of Governors, along with Paulson, need to be removed from office for intentional dereliction of duty.
PS: I thought TARP V1 was out of money..... Is Treasury kniting checks?
SEC is right on top of this one,
I thing the names may have been the clue for the sec,
Creative Capital Consortium, LLC and A Creative Capital Concept$, LLC
http://www.sec.gov/litigation/litreleases/2008/lr20840.htm
NFLD.......it's back
Northfield Laboratories Inc. (NFLD, $1.15, $0.61, 112.98%), which had a market capitalization of $12.1 million as of Monday's close, said Tuesday the Food and Drug Administration granted priority review status to its application for U.S. marketing of its PolyHeme blood-substitute product.
three year chart.........
http://stockcharts.com/h-sc/ui?s=NFLD&p=W&yr=3&mn=0&dy=0&id=p15685912469
Does this lead to more "back door" involvment,
http://www.foxnews.com/story/0,2933,432501,00.html
Friday, October 03, 2008
By Bill Sammon
WASHINGTON — Unqualified home buyers were not the only ones who benefitted from Massachusetts Rep. Barney Frank’s efforts to deregulate Fannie Mae throughout the 1990s.
So did Frank’s partner, a Fannie Mae executive at the forefront of the agency’s push to relax lending restrictions.
Now that Fannie Mae is at the epicenter of a financial meltdown that threatens the U.S. economy, some are raising new questions about Frank's relationship with Herb Moses, who was Fannie’s assistant director for product initiatives. Moses worked at the government-sponsored enterprise from 1991 to 1998, while Frank was on the House Banking Committee, which had jurisdiction over Fannie.
Both Frank and Moses assured the Wall Street Journal in 1992 that they took pains to avoid any conflicts of interest. Critics, however, remain skeptical.
"It’s absolutely a conflict," said Dan Gainor, vice president of the Business & Media Institute. "He was voting on Fannie Mae at a time when he was involved with a Fannie Mae executive. How is that not germane?
GMAC gets 5 bil, Fed loans GM another 1 bil to help the deal,
So the "original deal" was revamped because GM could not "or did not" want to get it done under the original terms.....
GM lending unit gets $5 billion in government funds
By John Letzing, MarketWatch
Last update: 8:58 p.m. EST Dec. 29, 2008
SAN FRANCISCO (MarketWatch) - GMAC Financial Services, the lending unit of General Motors Corp., said late Monday it has received $5 billion in funds from the $700 billion U.S. government bailout program in a move designed to help the struggling automaker sell new cars and trucks.
In addition, the Treasury Department said it has agreed to lend up to $1 billion to GM so it can take part in a transaction that will help GMAC raise additional needed capital.
The loan to GM comes in addition to the $17.4 billion in federal assistance for domestic carmakers announced by the government earlier this month. GM and Chrysler appealed to the government for aid in restructuring earlier this year after suffering from plummeting sales that pushed them to the brink of bankruptcy.
The Treasury Department's purchase of $5 billion in preferred stock from GMAC comes after the lending unit last week received approval to become a bank holding company, a necessary step to become eligible for federal bailout money. See related story on GMAC winning bank status.
"The company intends to act quickly to resume automotive lending to a broader spectrum of customers to support the availability of credit to consumers and businesses for the purchase of automobiles," GMAC said in a prepared statement.
ORIGINAL DEAL...........
Saturday December 27, 3:47 pm ET
GMAC quiet on bailout hurdle after deadline passes
"GMAC had received the Federal Reserve's approval to become a bank holding company earlier in the week, but the approval was contingent on the ailing auto and home loan provider completing a complicated debt-for-equity exchange by 11:59 p.m. EST Friday."
"GMAC's goal is to reach $30 billion in capital, the majority of which would come from the exchange of debt. Another part of the equity requirement included a demand from the Fed that $2 billion of the total come from new equity. So far, GMAC has received a commitment of $750 million from GM and Cerberus Capital Management. It's unclear whether that funding would come from the bridge loans the U.S. Treasury granted GM and Chrysler LLC -- which is owned by Cerberus-- earlier this month."
http://biz.yahoo.com/ap/081227/gmac_financing.html
Cars leaving lots without drivers
Posted on Sun, Dec. 28, 2008
By Maria Panaritis
Inquirer Staff Writer
A half-dozen trailers rolled up to Eckenhoff Cadillac Buick Pontiac GMC in Jenkintown bright and early and wiped the lot clean of $8.4 million in inventory - Hummers, Cadillacs and all.
"Load up, leave. Load up, leave. . . ." The funereal rhythm of repossession transfixed the sales guys next door at Hopkins Ford Lincoln Mercury, who watched through their showroom window as the devastating news descended on their neighbor.
GMAC, the beleaguered financing arm of General Motors Corp., had called the loan that had enabled Scott Eckenhoff to stock new and used vehicles. Big trailers carted away the collateral from a Big Three retailer that had been hanging on by a thread.
GMAC also cleared out Eckenhoff's used-car lot in Maple Shade, which held another batch financed by a GMAC "floor-plan" credit line.
It was a dramatic turn for a dealer whose struggle, while perhaps extreme, is but the beginning, some say, of a broader reckoning that will shutter more Big Three - GM, Ford and Chrysler - showrooms in the months to come. About two dozen have been shut down in the region over the last 12 to 24 months, according to one industry watcher.
"When it happens next door to you, it's just a vivid reminder that you can't relax in this economy for one minute," said Bob Sklar, sales manager at Hopkins Ford, where business has remained relatively strong.
The recession that has battered global auto sales and put U.S. automakers in acute financial distress has also squeezed lenders to such a degree that dealers who rely on their credit lines to fill their lots - men like Eckenhoff - have little room for error.
The grim scene, which played out two weeks ago, while evoking sympathy, also conveyed an urgent message to those hoping to protect their business as the auto industry continues to contract.
"You have to stay on top of your game," said Sklar, 65, a straight-talker who wears cuff links to work and has managed sales crews for a quarter-century. "You have to maximize your opportunities. You have to do what you have to do to make a deal."
Eckenhoff, 48, thought he had done just that, despite defaulting on his GMAC financing agreement.
In May, when GMAC first said it planned to drop his loan, Eckenhoff negotiated the first of several extensions and searched for another lender to finance his inventory - a task made even harder after the financial markets crashed and banks became far pickier about loan policies.
The third-generation car dealer cut inventory, slashed expenses, and tried to raise cash. Two months ago, he laid off 48 workers to bring expenses in line with low sales.
Eckenhoff was not alone; other area GM dealers have been squeezed by tightened lending as GMAC has sought to trim its auto portfolio and make up for losses it suffered in the subprime market.
Some franchise owners are trying to sell their dealerships while others are rolling the dice and trying to hang on.
GM has told Congress it plans to eliminate a quarter of its dealerships by 2012.
The Detroit automaker recently told Congress the majority of showrooms to be eliminated would be in metropolitan and suburban areas, where its decades-old network is now considered bloated and noncompetitive.
Eckenhoff's time all but ran out when representatives from GMAC paid him a visit earlier this month, he said.
"They came into my dealership. They said, 'Scott, we want to talk to you.' They said, 'Scott, we've decided to take back the cars.' I said, 'Guys, you can't take back the cars.' "
Over the next two days, the cars - the fuel of Eckenhoff's business - were removed.
"I never anticipated this," he said.
Two years ago, Eckenhoff employed 80 people. Two months ago, he chopped that down to about 30. Now he is at 18, including four mechanics keeping his service bays running for repairs on all models.
All that remained in the center of his bare and dark showroom Friday was a Hummer with a giant red holiday ribbon draped over its hood and a white Christmas bear in a Santa hat and red sweater atop the roof. The empty lot was deserted.
Eckenhoff said he was trying to stay open while trying to salvage what was left of his franchise.
GMAC spokesman Mike Stoller declined to discuss Eckenhoff's specific case but said inventory recalls typically occur after a dealer defaults on loan payments.
"That is usually the final stage, which would require us to reclaim our assets that were used as collateral," Stoller said. "It's pretty simple. If the bills aren't being paid, therein lies the trigger."
Inventory loans are critical - and in the crosshairs of today's credit crunch. Dealers order cars, pay the factory with a floor-plan credit line from a bank or a financier such as GMAC, and then pay interest while the cars sit on lots. As each car is sold, the dealer pays back the lender.
If the lender cancels the credit line and a dealer cannot find alternative financing - as was the case with Eckenhoff - the dealer must sell his franchise, terminate it, or lose his inventory.
Without inventory, business effectively stops, and the dealer's franchise agreement with the manufacturer is jeopardized. Such a violation of the franchise agreement makes it easier for an automaker to shut down a dealer, who then stands to lose what in Eckenhoff's case was $3 million in personal investment to start up the business.
This is why some locals suspect GMAC is working with GM to clamp down on sites that GM would like to see eliminated from the grid - even though GM has not released a list of targeted dealerships.
"Some dealers believe it's just part of GM's plan to proactively reduce the number of dealerships, and that's one way to do it," said Richard Weitzman of Staubach Retail's auto group practice in Bala Cynwyd.
Weitzman, who brokers land transactions for local auto dealers, said there is a growing sense that GMAC is coming down hard on some dealers for GM, which is hoping to avert bankruptcy through steep restructuring.
GMAC's Stoller said this was "not the case. GMAC continues to extend credit when there is an appropriate business case for doing so."
Asked if GMAC was singling out GM's weakest dealers, he said: "We are prudently managing our portfolio for risk in a consistent manner."
Eckenhoff, who leases the land here, said he was working on a deal to save his franchise. Meanwhile, he hopes GM agrees to buy back from GMAC his new cars for the same price he paid. He also hopes GMAC gets good prices at auction for his used cars.
If GMAC gets less than what Eckenhoff paid, he will owe GMAC hundreds of thousands of dollars - if not more.
Eckenhoff is beside himself with worry and regret.
"When something like this happens, it's about what happens in the economy. And if you can't adjust, you're out of business. And so be it."
http://www.philly.com/inquirer/business/20081228_Cars_leaving_lots_without_drivers.html
GMAC quiet on bailout hurdle after deadline passes
"GMAC had received the Federal Reserve's approval to become a bank holding company earlier in the week, but the approval was contingent on the ailing auto and home loan provider completing a complicated debt-for-equity exchange by 11:59 p.m. EST Friday."
"GMAC's goal is to reach $30 billion in capital, the majority of which would come from the exchange of debt. Another part of the equity requirement included a demand from the Fed that $2 billion of the total come from new equity. So far, GMAC has received a commitment of $750 million from GM and Cerberus Capital Management. It's unclear whether that funding would come from the bridge loans the U.S. Treasury granted GM and Chrysler LLC -- which is owned by Cerberus-- earlier this month."
http://biz.yahoo.com/ap/081227/gmac_financing.html
Senior economic adviser warns of 10% unemployment
Obama aides stress long-term goals
Senior economic adviser warns of 10% unemployment by end of 2009
By Michael Kitchen, MarketWatch
Last update: 12:10 p.m. EST Dec. 28, 2008
NEW YORK (MarketWatch) -- Top advisers to President-elect Barack Obama stressed the incoming administration's long-term economic goals, saying Sunday that the situation is likely to deteriorate more than previously forecast in the short term, with double-digit unemployment likely.
"Today, many experts believe that unemployment could reach 10% by the end of next year, and our economy could fall $1 trillion short of its full capacity -- which translates into more than $12,000 in lost income for a family of four," Lawrence Summers, who has been named to head Obama's National Economic Council, said in an editorial published Sunday in the Washington Post.
Summers repeated Obama's plans for government works spending, including funds for infrastructure upgrades and environmental technology, but he played down the importance of direct stimulus to consumers.
"Some argue that instead of attempting to both create jobs and invest in our long-run growth, we should focus exclusively on short-term policies that generate consumer spending," he said. "But that approach led to some of the challenges we face today -- and it is that approach that we must reject if we are going to strengthen our middle class and our economy over the long run."
Fellow senior Obama adviser David Axelrod also emphasized broad, long-term economic policy in remarks Sunday to NBC's "Meet the Press" and CBS's "Face the Nation."
Axelrod said economic programs under the new government should be planned "in a way that leaves a lasting footprint," and should avoid "earmarks," referring to legislators' pet projects benefiting only their own constituents.
He said that while Obama intends to reduce taxes for the middle class, the incoming president has yet to decide what to do about those tax cuts implemented early in the Bush administration, which some Democrats have criticized as favoring the wealthiest Americans.
"We'll make that decision moving forward," Axelrod said on NBC when asked whether Obama would allow the Bush tax cuts to expire.
However, he reiterated promises for immediate tax relief aimed at the middle class, saying the coming stimulus package "will include a portion of that tax cut that will become part of the permanent tax cut that he'll have in his upcoming budget."
Axelrod also said that his role in the Obama White House would focus on disseminating the administration's message to the public and wouldn't be as politically focused as that of former senior Bush adviser Karl Rove.
http://www.marketwatch.com/news/story/Obama-aides-stress-long-term/story.aspx?guid=%7B0CA3917B%2D23A2%2D449C%2D9DD9%2D6A11C723C13A%7D
Satyam reviews 'strategic options' after dumping Maytas bid
By Michael Kitchen
Last update: 3:17 p.m. EST Dec. 28, 2008
NEW YORK (MarketWatch) -- Indian software giant Satyam Computer Services Ltd. said Sunday it is rescheduling its next board meeting to consider options after it canceled plans to buy infrastructure firm Maytas Properties for about $1.6 billion due to investor opposition. The board meeting, now set for Jan. 10, will "broaden the scope of its deliberations beyond a possible buy-back of its stock," according to Satyam Chairman Ramalinga Raju. Possible moves include changing the size and composition of the board of directors and "conducting a review of the company's strategic options to enhance shareholder value," for which it has engaged DSP Merrill Lynch. "Satyam's Board of Directors recognizes
"Cash-strapped states weigh selling roads, parks"
And after the new administration is in place and they implement their multi billion dollar infrastructure rebuilding program the "new owners" of the parks, bridges, roads etc. will be eligible for government funding to improve their recent acquisitions.
sounds like a great proposition
By PETER SCHIFF
DECEMBER 27, 2008
There's No Pain-Free Cure for Recession
Belt-tightening is required by all, including government
By PETER SCHIFF
As recession fears cause the nation to embrace greater state control of the economy and unimaginable federal deficits, one searches in vain for debate worthy of the moment. Where there should be an historic clash of ideas, there is only blind resignation and an amorphous queasiness that we are simply sweeping the slouching beast under the rug.
With faith in the free markets now taking a back seat to fear and expediency, nearly the entire political spectrum agrees that the federal government must spend whatever amount is necessary to stabilize the housing market, bail out financial firms, liquefy the credit markets, create jobs and make the recession as shallow and brief as possible. The few who maintain free-market views have been largely marginalized.
Taking the theories of economist John Maynard Keynes as gospel, our most highly respected contemporary economists imagine a complex world in which economics at the personal, corporate and municipal levels are governed by laws far different from those in effect at the national level.
Individuals, companies or cities with heavy debt and shrinking revenues instinctively know that they must reduce spending, tighten their belts, pay down debt and live within their means. But it is axiomatic in Keynesianism that national governments can create and sustain economic activity by injecting printed money into the financial system. In their view, absent the stimuli of the New Deal and World War II, the Depression would never have ended.
On a gut level, we have a hard time with this concept. There is a vague sense of smoke and mirrors, of something being magically created out of nothing. But economics, we are told, is complicated.
It would be irresponsible in the extreme for an individual to forestall a personal recession by taking out newer, bigger loans when the old loans can't be repaid. However, this is precisely what we are planning on a national level.
I believe these ideas hold sway largely because they promise happy, pain-free solutions. They are the economic equivalent of miracle weight-loss programs that require no dieting or exercise. The theories permit economists to claim mystic wisdom, governments to pretend that they have the power to dispel hardship with the whir of a printing press, and voters to believe that they can have recovery without sacrifice.
As a follower of the Austrian School of economics I believe that market forces apply equally to people and nations. The problems we face collectively are no different from those we face individually. Belt tightening is required by all, including government.
Governments cannot create but merely redirect. When the government spends, the money has to come from somewhere. If the government doesn't have a surplus, then it must come from taxes. If taxes don't go up, then it must come from increased borrowing. If lenders won't lend, then it must come from the printing press, which is where all these bailouts are headed. But each additional dollar printed diminishes the value those already in circulation. Something cannot be effortlessly created from nothing.
Similarly, any jobs or other economic activity created by public-sector expansion merely comes at the expense of jobs lost in the private sector. And if the government chooses to save inefficient jobs in select private industries, more efficient jobs will be lost in others. As more factors of production come under government control, the more inefficient our entire economy becomes. Inefficiency lowers productivity, stifles competitiveness and lowers living standards.
If we look at government market interventions through this pragmatic lens, what can we expect from the coming avalanche of federal activism?
By borrowing more than it can ever pay back, the government will guarantee higher inflation for years to come, thereby diminishing the value of all that Americans have saved and acquired. For now the inflationary tide is being held back by the countervailing pressures of bursting asset bubbles in real estate and stocks, forced liquidations in commodities, and troubled retailers slashing prices to unload excess inventory. But when the dust settles, trillions of new dollars will remain, chasing a diminished supply of goods. We will be left with 1970s-style stagflation, only with a much sharper contraction and significantly higher inflation.
The good news is that economics is not all that complicated. The bad news is that our economy is broken and there is nothing the government can do to fix it. However, the free market does have a cure: it's called a recession, and it's not fun, easy or quick. But if we put our faith in the power of government to make the pain go away, we will live with the consequences for generations.
Mr. Schiff is president of Euro Pacific Capital and author of "The Little Book of Bull Moves in Bear Markets" (Wiley, 2008).
Accounting Standards Wilt Under Pressure
By Glenn Kessler
Washington Post Staff Writer
Saturday, December 27, 2008; Page A01
World leaders have vowed to help prevent future financial meltdowns by creating international accounting standards so all companies would play by the same rules, but the effort has instead been mired in loopholes and political pressures.
In October, largely hidden from public view, the International Accounting Standards Board changed the rules so European banks could make their balance sheets look better. The action let the banks rewrite history, picking and choosing among their problem investments to essentially claim that some had been on a different set of books before the financial crisis started.
The results were dramatic. Deutsche Bank shifted $32 billion of troubled assets, turning a $970 million quarterly pretax loss into $120 million profit. And the securities markets were fooled, bidding Deutsche Bank's shares up nearly 19 percent on Oct. 30, the day it made the startling announcement that it had turned an unexpected profit.
The change has had dramatic consequences within the cloistered world of accounting, shattering the credibility of the IASB -- the very body whose rules have been adopted by 113 countries and is supposed to become the global standard-setter, including for the United States, within a few years.
Sir David Tweedie, chairman of the IASB, acknowledged that the body needs more protection from political manipulation before it can claim that it has become the global gold standard.
Tweedie said he nearly resigned over the rule change demanded by European politicians. "I was so frustrated by the whole thing," he said. "All the time when we are trying to build a global accounting system, and we are pretty close to it, and then suddenly out of left field this thing appears. It's just absolutely exasperating."
U.S. standards have been set by the Financial Accounting Standards Board since 1973. "Right now, there is no credibility," said Robert Denham, chairman of the Financial Accounting Foundation, which oversees the FASB. "If we are going to have global accounting standards, my view is that is not going to work if the IASB is going to be jerked around by the European Commission. That is the very real risk that is posed by the EC coercion and the IASB's response."
The episode exposes how small, incremental changes in arcane accounting rules can affect billions of dollars in market value and corporate profitability. In turn, the money at risk raises the political stakes, as desperate companies begin to lobby political leaders to insist on changes that normally would come about only after a careful discussion and evaluation by experts.
For years, there has been a disconnect between U.S. and international accounting rules. With the history of corporate litigation in the United States, U.S. standards tend to be exact and explicit, making it easier for companies to defend themselves in court.
International rules rely on broad principles, giving companies greater leeway to make their own judgments. An extensive review of international accounting standards published last month by Moody's Investors Service found significant differences between two French companies on one key issue -- even though they used the same accounting firm.
Nevertheless, more than 110 countries have already adopted international rules since the IASB was established in 2001, with Japan, South Korea, India and Canada soon to make the switch. Tweedie expects that 150 countries will have adopted IASB rules within the next three years. The Securities and Exchange Commission on Nov. 14 adopted a plan to have all U.S. companies prepare their statements using international standards for fiscal years ending after Dec. 15, 2016. More than 100 of the largest companies would be permitted to adopt the rules as soon as next year.
But the financial crisis demonstrated how vulnerable the fledgling system is to political pressure.
On Oct. 8, the leaders of France, Germany, Italy, Britain and the European Commission met in Paris to discuss the worldwide economic crisis. They issued a statement saying they were working together "within the European Union and with our international partners" to ensure the safety and stability of the worldwide banking system. But buried within the statement was a sentence warning that European banks should not face a competitive disadvantage with U.S. banks "in terms of accounting rules and their interpretation." The leaders added ominously: "This issue must be resolved by the end of the month."
At issue is an accounting standard known as fair value, or mark to market, in which companies disclose how much an asset could fetch on the open market. With the values of assets plummeting, banks were suddenly stuck with paper losses on assets they could no longer sell. With some critics saying the provision was forcing banks to take large write-downs, the SEC and FASB issued guidance in late September that companies could use their own internal models for assigning a value to assets -- in essence, a nod to the principles-based international rules.
But European officials smelled a rat. Under rare circumstances, U.S. companies are permitted to reclassify assets they were actively seeking to trade into long-term "loans," using an accounting rule that was considered weaker than the international equivalent. The international rules did not permit such transfers, and European officials feared that the new guidance was handing the Americans a competitive advantage.
Shortly after the European leaders' statement, Commissioner Charlie McCreevy of the European Commission, who was in charge of the European Union internal market, signaled he would introduce legal changes, overriding the international rules. McCreevy decided to exploit a loophole in the system -- that all accounting rules must be adopted as legislation by the E.U. So McCreevy was going to force the changes on the IASB by threatening to remove -- or carve out -- the existing regulation, leaving nothing in its place.
"We made it clear what the IASB should accept," said Oliver Drewes, a spokesman for McCreevy. "There is always the right, and threat and the pressure, that one could go for a carve-out for European companies."
Tweedie said the rulemaking body had only four days to act before McCreevy pushed through a change in the law, even though accounting changes of this magnitude would normally take months to achieve.
Unlike the U.S. board, the international board has no regulator like the SEC to help shield it from political pressure. So the IASB was at the mercy of the European Commission.
"There had been pressure on him, I suspect, from some of the European leaders," Tweedie said, referring to McCreevy. "It was quite clear it was going to be pushed through and that would have been a disaster. We were faced with this hole being blown in the European accounting, and we just wanted to step in and control it."
But the IASB bowed to demands to let the firms backdate the accounting shift to the beginning of July -- something not permitted under U.S. rules.
In a recent report, Moody's wrote that the backdating provision could distort a bank's earnings and capital position, since "it allows managements to 'cherry-pick' selected assets" and "distort their economic reality," making it more -- not less -- difficult to compare global bank performance.
"The measure does not make much sense in the first place," said J.F. Tremblay, a Moody's vice president. "But the fact that a board can be influenced like that is not good news."
Madoff's Victims List
WSJ December 26, 2008
The fallout from Bernard Madoff's alleged Ponzi scheme reverberated around the world as the list of investors facing losses widened. Among the biggest losers were charities, hedge funds, and banks in Europe and Asia. Below, see some of the most exposed investors and sort by the amount of potential losses. --Updated 12/26/08
Fairfield Greenwich Advisors
An investment management firm
$7,500,000,000
More than half of Fairfield Greenwich's $14.1 billion in assets under management, or about $7.5 billion was connected to Madoff.
Tremont Group Holdings
Asset management firm
$3,300,000,000
The investment firm is owned by OppenheimerFunds and Massachusetts Mutual Life Insurance Co. Tremont's Rye Investment Management business had $3.1 billion invested, and its fund of funds group invested another $200 million.
Banco Santander
Spanish bank
$2,870,000,000
In euros, the figure is 2.33 billion.Of that, 2.01 billion euros belongs to institutional investors, Optimal Strategic hedge fund investors (international private banking customers); 320 mllion euros belongs to other private banking customers.
Bank Medici
Austrian bank
$2,100,000,000
The bank had two funds with $2.1 billion (1.5 billion euros) invested with Madoff. Bank Medici is 25% owned by Unicredit SpA and 75% owned by chairwoman Sonja Kohn.
Ascot Partners
A hedge fund founded by billionaire investor, philanthropist and GMAC chief J. Ezra Merkin
$1,800,000,000
The hedge fund had $1.8 billion under management as of Sept. 30, had substantially all of its assets invested with Mr. Madoff.
Access International Advisors
A New York-based investment firm
$1,400,000,000
The investment-advisory firm's co-founder Thierry Magon de La Villehuchet, 65, was found dead in his Manhattan office on Dec. 24, 2008, in an apparent suicide.
Fortis
Dutch bank
$1,350,000,000
Fortis Bank and its subsidiaries have no direct exposure to Bernard Madoff Investment Securities LLC, but parts of the group do have a risk exposure to certain funds it provides collateralized lending to. If, as a result of the alleged fraud, the value of the assets of these funds is nil and the respective clients cannot meet their obligations, Fortis Bank Nederland (Holding) N.V.'s loss could amount to around EUR 850 million to EUR 1 billion. The continuity of Fortis Bank Nederland (Holding) N.V.and its subsidiaries is not at stake in any way.
Union Bancaire Privee
Swiss bank
$1,000,000,000
The bank's exposure to Madoff -- less than 1.26 billion Swiss francs -- is less than 1% of overall bank assets.
HSBC
British bank
$1,000,000,000
HSBC provided financing to a small number of institutional clients who invested in funds with Madoff; some clients in its global custody business have invested with Madoff, but the company doesn't believe these arrangements should be a source of exposure to the group.
Natixis SA
A French investment bank
$554,400,000
The company says it didn't make direct investment in Madoff-managed funds; some investments made on behalf of customers could have ended up being managed by Madoff. Exposure is about 450 million euros.
Carl Shapiro
The founder and former chairman of apparel company Kay Windsor Inc., and his wife
$545,000,000
Mr. Shapiro, a 95-year-old apparel entrepreneur and investor, had $545 million with Mr. Madoff, creating what could become the largest personal loss yet in the scandal. A spokeswoman for the family confirmed that Mr. Shapiro's charitable foundation, the Carl and Ruth Shapiro Family Foundation, invested $145 million with Mr. Madoff. Mr. Shapiro and his family had an additional $400 million or more invested with Mr. Madoff. Mr. Shapiro, a widely respected philanthropist, was one of Mr. Madoff's earliest and largest investors.
Royal Bank of Scotland Group PLC
British bank
$492,760,000
The bank had exposure of about 400 million pounds to Madoff through trading, collateralized lending.
BNP Paribas
French bank
$431,170,000
The company said it has no investment of its own in Madoff-managed hedge fund but it does have risk exposure (up to 350 million euros) through its trading business and collateralized lending to funds of hedge funds.
BBVA
Spanish bank
$369,570,000
The company reiterated it doesn't have direct exposure to Madoff but would face losses of 300 million euros if Madoff funds were found not to exist.
Man Group PLC
A U.K. hedge fund
$360,000,000
Invested in funds directly/indirectly sub-advised by Madoff Securities
Reichmuth & Co.
A Swiss private bank
$327,000,000
The Lucerne-based private bank warned investors that around 385 million Swiss francs, or 3.5% of its assets under management, were affected.
Nomura Holdings
Japanese brokerage firm
$304,000,000
The 27.5 billion yen exposure is through Fairfield Sentry; That amount represents 0.2% of assets under management.
Maxam Capital Management
A fund of funds based in Darien, Connecticut
$280,000,000
The fund reported a combined loss of $280 million on funds they had invested.
EIM SA
A European investment manager with about $11 billion in assets
$230,000,000
The European investment manager with about $11 billion in assets. Overall, EIM assets at risk are less than 2% of what it manages.
AXA SA
French insurance giant
$123,200,000
Exposure is well below 100 million euros.
UniCredit SpA
Italian Bank
$92,390,000
The company's total exposure is about 75 million euros. Dublin-based Pioneer Alternative Investments is indirectly exposed to Madoff via feeders; Italian clients have zero exposure.
Nordea Bank AB
Swedish Bank
$59,130,000
The amount of exposure is about 48 million euros.
Hyposwiss
A Swiss private bank owned by St. Galler Kantonalbank
$50,000,000
Hyposwiss said roughly 0.1% of its overall assets was invested in Madoff products through managed accounts. Another $100 million is exposed through clients who chose to invest in Madoff funds. St. Galler Kantonalbank said its financial situation and liquidity aren't hurt by Hyposwiss' exposure.
Banque Benedict Hentsch & Cie. SA
A Swiss-based private bank
$48,800,000
Banque Benedict Hentsch said its clients have 56 million Swiss francs at risk. Benedict Hentsch had also recently agreed to merge with Fairfield Greenwich Group, a major Madoff distributor. When the news of Mr. Madoff's arrest broke, it scrambled to undo that deal.
Fairfield, Conn.
town pension fund
$42,000,000
The town's employees board and police and fire board, which cover 971 workers, had $41.9 million invested with Madoff, said Paul Hiller, Fairfield's chief fiscal officer.
Bramdean Alternatives
An asset manager
$31,200,000
The exposure is about 9.5% of assets.
Jewish Community Foundation of Los Angeles
The largest manager of charitable gift assets for Los Angeles Jewish philanthropists
$18,000,000
The amount invested with Madoff represented less than 5% of the Foundation's assets.
Harel Insurance Investments & Financial Services Ltd.
Israel-based insurance firm
$14,200,000
N/A
Baloise Holding AG
Swiss insurer
$13,000,000
N/A
Societe Generale
French Bank
$12,320,000
The company says its exposure, which is less than 10 million euros, is "negligible."
Groupama SA
French insurer
$12,320,000
Exposure is around 10 million euros.
Credit Agricole SA
French bank
$12,320,000
Exposure is less than 10 million euros.
Richard Spring
individual investor
$11,000,000
A Boca Raton resident and former securities analyst, says he had about 95% of his net worth invested with Mr. Madoff. Mr. Spring said he was also one of the unofficial agents who connected Mr. Madoff with dozens of investors, from a teacher who put in $50,000 to entrepreneurs and executives who would put in millions.
RAB Capital
hedge fund
$10,000,000
N/A
Banco Popolare
Italian bank
$9,860,000
The company says it had indirect exposure of up to 8 million euros; maximum lost on funds distributed to institutional, private clients is about 60 million euros.
Korea Teachers Pension
A 10 trillion won Korean pension fund
$9,100,000
N/A
Swiss Life Holding
Swiss insurer
$78,900,000
Swiss Life said it has indirectly invested assets worth around 90 million Swiss francs through funds of funds managed by Madoff Investment Securities.
North Shore-Long Island Jewish Health System
health system
$5,700,000
Exposure represents less than 1% of the health system's investment portfolio. A donor agreed to reimburse the system for any losses.
Neue Privat Bank
Swiss bank
$5,000,000
The bank invested in a certificate based on a hedge fund with exposure to Madoff
Clal Insurance Enterprise Holdings
An Israel-based financial services company
$3,100,000
N/A
Ira Roth
individual investor
$1,000,000
Mr. Roth, a New Jersey resident, says his family has about $1 million invested through Mr. Madoff's firm.
Mediobanca SpA
via its subsidiary Compagnie Monegasque de Banque.
$671,000
Limited to $671,000 via its Compagnie Monegasque de Banque. via its subsidiary Compagnie Monegasque de Banque.
Fred Wilpon
owner of New York Mets
N/A
N/A
Steven Spielberg
The Spielberg charity -- the Wunderkinder Foundation
N/A
N/A
JEHT Foundation
A New York foundation focused on electoral and criminal justice reform
N/A
The foundation, which stands for Justice, Equality, Human dignity and Tolerance, will close its doors at the end of January 2009. Major donors Jeanne Levy-Church and Kenneth Levy-Church had all their funds managed through Madoff.
Mortimer B. Zuckerman Charitable Remainder Trust
The charitable trust of real-estate magnate, who owns the Daily News and U.S. News & World Report
N/A
Funds exposed represented 11% of the value of that charitable trust.
Robert I. Lappin Charitable Foundation
A Massachusetts-based Jewish charity
N/A
The group, which financed trips for Jewish youth to Israel, was forced to close on Friday because the money that supported its programs was invested with Madoff.
Chais Family Foundation
A charity that gives away about $12.5 million annually to Jewish causes
N/A
The California-based charity group invested entirely with Madoff, and was forced to shut down operations on Sunday after years of donating some $12.5 million annually to Jewish causes in Israel and Eastern Europe.
KBC Group NV
Belgian banking and insurance group
N/A
No direct exposure; some indirect exposure through collateralized loans, but the exposure is very limited and immaterial to KBC's earnings. KBC has also made some loan advances to institutional customers who have invested in funds managed by Madoff Investment Securities, but this shouldn't have any material impact either, the company said.
Barclays PLC
British bank
N/A
The bank says it has "minimal" exposure" and is "fully collateralized"
Dexia
French bank
N/A
No direct investments in funds managed by Madoff,; private banking clients have total exposure of EUR78 million to funds primarily invested in Madoff funds. Indirectly, Dexia is exposed through partially collateralized lending operations to funds exposed to Madoff funds for a gross amount of EUR164 million. If the assets managed by Madoff Investment Securities were nil, the above mentioned lending operations could trigger an after tax loss of about EUR85 million for Dexia.
Allianz Global Investors
The asset management unit of German insurer Allianz SE
N/A
The unit says exposure "is not significant."
Banco Espanol de Credito SA (Banesto)
A Spanish bank contolled by Banco Santander
N/A
Its clients have a total 2 million euro exposure; The amount is included in the 2.33 billion euros already disclosed by parent company Banco Santander.
CNP Assurances
French insurer
N/A
No direct exposure. Indirect exposure of 3 million euros via a fund of funds
UBS AG
Swiss bank
N/A
The bank says is has "no material exposure." It declined to comment on press reports that its funds-of-funds for clients had $1.4 billion in exposure
Yeshiva University
A New York-based private university
$110,000,000
Although the university had "no direct investments" in Madoff's firm, a portion of its endowment had been invested for 15 years with Ascot Partners, which had "substantially all its assets invested with Madoff." Yeshiva's investment represents about 8% of its endowment. J. Ezra Merkin had been a University trustee but has resigned in the wake of the scandal.
The Elie Wiesel Foundation for Humanity
The charitable foundation of Nobel laureate
$15,200,000
The foundation said it invested "substantially all" of its assets.
Leonard Feinstein
The co-founder of retailer Bed Bath & Beyond
N/A
N/A
Sen. Frank Lautenberg
The charitable foundation of the New Jersey Senator's family
N/A
N/A
Norman Braman
former owner of Philadelphia Eagles
N/A
N/A
Jeffrey Katzenberg
The chief executive of DreamWorks Animation SKG Inc.
N/A
Mr. Katzenberg's financial affairs along with those of Mr. Spielberg were managed by Mr. Breslauer, Mr. Katzenberg has suffered millions in Madoff-connected losses, say people familiar with the matter.
Gerald Breslauer
The Hollywood financial advisor to Steven Spielberg and Jeffrey Katzenberg
N/A
Along Messrs Katzenberg and Spielberg, Mr. Breslauer himself has likely sustained heavy losses in the Madoff affair. He customarily invests alongside his clients, say these people, and has sometimes been a larger investor than the people he represented
Kingate Management
hedge fund
N/A
Kingate's $2.8 billion hedge fund Kiingate Global Fund reportedly invested heavily with Madoff
Julian J. Levitt Foundation
Texas-based charity
N/A
N/A
Loeb family
N/A
N/A
N/A
Lawrence Velvel
individual investor
N/A
Mr. Velvel is dean of the Massachusetts School of Law
Fix Asset Management.
hedge fund
N/A
reportedly invested heavily in Madoff's portfolios
Genevalor, Benbassat & Cie.
money manager in Geneva
N/A
Members of the Benbassat family, which run the firm, have long known Mr. Madoff. In a statement on its Web site, Genevalor said it "has been reviewing the potential damages caused to its clients" by the alleged Madoff fraud. A statement from the Thema fund said it had assets with Madoff that were now frozen, but did not elaborate.
Banco Espirito Santo
Portugese bank
$21,400,000
The amount represents about 0.1% of assets under management.
Great Eastern Holding
Singapore insurer
$44,266,000
Great Eastern said S$7.7 million of its S$64 million exposure is invested from its Life Fund. Great Eastern is 87% owned ny Oversea-Chinese Banking Corp.
M&B Capital Advisers
Spanish brokerage
$52,800,000
The firm is run by the son and son-in-law of the chairman of Banco Santander. Through M&B, private and institutional investors bought more than $214 million in Madoff's funds.
Royal Dutch Shell pension fund
Global energy and petrochemical company
N/A
The pension fund fund has an indirect investment that may be affected. The fund originally invested $45 million. The alleged fraud won't affect the financial position and funding status of the fund.
Phoenix Holdings
Israeli financial services company
$12,600,000
Phoenix's insurance unit invested $15 million over the last three years in funds managed by Thema, which made investments through Madoff. In November, the company requested to redeem $10 million. The payment was due Dec. 12 but Phoenix hasn't received it.
Credicorp
Peruvian financial services company
$4,500,000
Credicorp's Atlantic Security Bank unit has $1 million in direct exposure and up to $3.5 million in potential contingencies "related to transactions secured by these investments."
Fukoku Mutual Life Co.
Japanese insurer
N/A
The company said it holds similar investments trusts to those held by Sumitomo Life Insurance Co. but declined to specify the balance. Sumitomo disclosed that it has about 2 billion yen, or about $22 million, exposed via trusts.
New York Law School
law school in New York City
$300,000
The school invested the money through its endowment entity. The school filed an investor lawsuit against J. Ezra Merkin, Ascot Partners and BDO Seidman.
Nipponkoa Insurance
Japanese insurer
N/A
The company said it holds similar investments trusts to those held by Sumitomo Life Insurance Co. but declined to specify the balance. Sumitomo disclosed that it has about Y2 billion exposed via trusts.
Sumitomo Life Insurance Co.
Japanese insurer
$22,000,000
Sumitomo Life didn't invest directly in the Madoff fund but part of its investment trust holdings were linked to it.
Swiss Reinsurance Co.
Swiss insurer
$300,000
Indirect exposure, less than $3 million, is through hedge fund investments; no direct exposure.
Aozora Bank Ltd
Japanese lender
$137,000,000
Aozora entrusted 12.4 billion yen to investment funds, which invested with Madoff. Cerberus Capital Management LP owns a majority stake in Aozora.
UBI Banca
Italian bank
$86,000,000
The bank said the exposure is linked to proprietary investments. UBI Pramerica and Capitalgest Alternative Investments, the assets-under-management units, have no exposure.
Taiyo Life Insurance Co.
Japanese insurer
$221,000
Taiyo Life didn't invest directly in the Madoff fund.
Caisse d'Epargne
French bank
$11,100,000
Caisse d'Epargne said EUR1 million was for Caisse Nationale des Caisses d'Epargne, the central hub, and "under EUR7 million" was from its regional level. Natixis reported exposure around EUR450 million on Dec. 15.
J. Gurwin Foundation
Charity
N/A
$28 million charity invested heavily in Madoff funds. Gurwin said, "We got a body blow. We did not get killed."
EFG International
Swiss private bank
N/A
EFG clients have $130 million invested in Madoff through third-party funds sold by EFG. In addition, 0.3% of the bank's total invested assets, held in custody, are invested in Madoff.
Fire and Police Pension Association of Colorado
Pension fund
N/A
Fund, with $2.5 billion under management, had $60 million invested with Fairfield Greenwich until six months ago
International Olympic Committee
Olympic organizer
$4,800,000
The IOC's exposure represents about 1% of its total investment portfolio. Organizing committee confirmed they will be able to meet their obligations.
Support Organization for the Madison Cultural Arts District
Wisconsin cultural organization
N/A
$18 million invested with Fairfield Greenwich until September. A spokesman for the Overture Center in Madison, Wis., built with SOMCAD funds, said, "Speculation that SOMCAD could be on the hook is not outlandish."
Credit Industrial et Commercial
French financial-services group
$125,400,000
The bank has no direct exposure to Madoff but could be affected through an intermediary.
Hadassah
U.S. women's zionist organization
$90,000,000
N/A
United Association Plumbers & Steamfitters Local 267 in Syracuse
Local union pension and health care funds
N/A
The union is still trying to determine the extent of its losses. Its investments with Mr. Madoff go back 15 years.
Ramaz School
A Jewish school in New York
$6,000,000
N/A
Congregation Kehilath Jeshurun
A synagogue in New York
$3,500,000
N/A
The Maimonides School
A Jewish day school in Brookline, Mass.
$3,000,000
The school did not directly invest with Madoff, but the school was the sole beneficiary of a trust that lost about $3 million.
Yad Sarah
An Israeli nonprofit
$1,500,000
With a $21 million budget in 2008, Yad Sarah likely won't expand operations or develop any new services or projects in 2009.
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Sources: WSJ reporting; Associated Press; the companies and charities
A Different Christmas Poem,
A tribute to our troops,
Once Trusted Mortgage Pioneers, Now Pariahs
4 pages........
http://www.nytimes.com/2008/12/25/business/25sandler.html?pagewanted=1&_r=1&th&emc=th&adxnnlx=1230210104-meBhRwIpR%20Ety0mrngJ%20tA
Don Coxe, to retire from BMO Capital
BMO Capital Markets' "Renaissance Man", Don Coxe, to Retire
Will retain role as Portfolio Consultant to Coxe Commodity Fund
TORONTO, Dec. 23 /CNW/ - After a career spanning four decades in
institutional investing and money management, Don Coxe, Global Portfolio Strategist for BMO Capital Markets, has decided to retire. His last day will be December 31st.
In the new year, Don will be establishing his own independent advisory firm, Coxe Advisors LLC. Going forward, Mr. Coxe will retain his role as Portfolio Consultant to BMO's Coxe Commodity Fund and will continue to provide his valuable insights to BMO Nesbitt Burns Investment Advisors and their clients during 2009 through the publication of his portfolio strategy journal,
Basic Points, and in regular conference calls, both of which have gained a wide following in North America and around the world.
About Mr. Coxe
This year, Don Coxe was the recipient of the National Post/StarMine lifetime achievement award for excellence in investment research. He was also ranked as the number one portfolio strategist by institutional investors in the most recent Brendan Wood International Survey.
A trained historian and lawyer, Mr. Coxe served as Associate Editor of the National Review magazine in New York, practiced law in Toronto and served as General Manager for the Ontario Federation of Agriculture and General Counsel for the Canadian Federation of Agriculture. He has been CEO of a major Canadian investment counselling firm, Research Director and Strategist for a leading institutional dealer, a strategist on Wall Street and CEO and Chief Investment Officer for Harris Investment Management Inc. which, in 2005, was ranked number one overall as the best-performing mutual fund organization in the U.S.
Much of todays decline in the reverse ETF's is do to distributions,
http://biz.yahoo.com/bw/081222/20081222005889.html?.v=1
bbotcs, it appears he is,
http://www.portfolio.com/views/blogs/market-movers/2008/12/16/is-carl-shapiro-a-madoff-victim
http://www.shapirofamilyfdn.org/matriarch/MultiPiecePage.asp_Q_PageID_E_6_A_PageName_E_GrantmakingOverviewCapitalSupp
WGBH (Boston, MA)
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