http://money.cnn.com/2009/04/1...zz/index.htm?cnn=yes

Forget banks, keep an eye on trucks

Transportation stocks have outperformed the broader market lately. That's a good sign as long as freight shippers say the economy is stabilizing.

NEW YORK (CNNMoney.com) -- Earnings take center stage next week and everybody's going to be focused on how the banks will do.

Wells Fargo (WFC, Fortune 500) ignited a monstrous stock-market rally Thursday after it announced that first-quarter profits would be much stronger than expected. Now investors are hoping that other banking giants, such as JPMorgan Chase (JPM, Fortune 500) and Citigroup (C, Fortune 500), will also beat the Street.

If so, that could be a sign that the worst is finally over for the beleaguered banking sector. And that would be great news for the markets and economy, with more loans available for homes and cars or to start businesses.

But investors might be wise to take a look at another sector that's equally important and actually is a more reliable indicator of rebounds. I'm talking about the transportation sector.

Talkback: What do you need to see to convince you the economy is stabilizing?
The Dow Jones industrial average has surged about 25% in the past month. But its lesser-known transportation counterpart has done even better. The Dow Jones transportation average, which includes 20 of the nation's largest railroad, airline, trucking and marine companies, is up nearly 40% since early March.

It's easy to forget how crucial truckers, railroads and freight shippers are in this age of tweeting and downloading music. But people still need to buy lots of physical goods -- which in honor of George Carlin, I'll simply refer to as "stuff" -- for their daily lives.

And even though more and more people may order that stuff online, that stuff gets shipped from factories to warehouses and then to a retailer or your house thanks to transport companies.

If transportation companies are doing well, that should be a good sign for the rest of the markets and overall economy. In fact, some market strategists use something called the Dow Theory to try and ascertain if a broader market rally is legitimate.

The Dow Jones Indexes Web site, which includes information about all the various Dow market barometers, has a section that succinctly sums up this theory.

"The industrials make and the transports take. If the transports aren't taking what the industrials are making, it portends economic weakness and market problems."

With that in mind, the rally in transports could be encouraging -- as long as fundamentals are justifying it. If transportation companies start warning of more weak demand ahead, that may be even worse news for the markets than more bad news from the banks.

Investors won't have to wait long to find out if the transport rally is for real. Four of the companies in this group are on tap to report results in the coming week. They are: truckers J.B. Hunt Transport Services (JBHT) and Landstar System (LSTR), railroad CSX (CSX, Fortune 500), and low-cost carrier Southwest Airlines (LUV, Fortune 500).

Each of these companies are expected to report declines in sales and profits for the first quarter as demand for shipping remains anemic.

However, there are some tentative signs that the worst may be over for the transports. The American Trucking Association reported late last month that shipments, as measured by the weight of freight truckers haul, did rise in February from January. And that was the second consecutive monthly increase.

Still, shipments were down sharply from a year earlier, leading the trade group's economist to warn people to not read too much into February's gain. Bob Costello, the ATA's chief economist, said in a statement that the February increase "doesn't mean the economy is on the mend" and added that the year-over-year drop "highlights the current weakness in the freight environment."

Railroads are feeling the pain as well. The Association of American Railroads recently reported that freight traffic was down 17% in March. Bad weather in the Midwest combined with the weak economy to create what AAR senior vice president John Gray described in a statement as a "kick them when they're down element to the month, dropping already-depressed rail traffic levels even further."

So what people need to pay attention to is the guidance for the next quarter and the rest of the year.

Investors are hopeful that the housing market may be stabilizing and that consumers are slowly regaining confidence in the economy -- even though the unemployment rate is expected to rise for the foreseeable future. In other words, more and more economic "green shoots" are starting to appear.

But if the transport companies don't confirm that things are starting to look up for their businesses, those green shoots may quickly wither. Here's hoping that railroad CEOs are as optimistic about a recovery as banking CEOs seem to be and that transport stocks keep on trucking.

Yes, big trucks to hall all that money us republicans are making on the bank stocks, LOL.

quote:

Originally posted by davdah:
Yes, big trucks to hall all that money us republicans are making on the bank stocks, LOL.

I doubt I'll need a truck, but yesterday put me back in the plus column. So, I'll celebrate this and then wait for the next collapse.

Tarp, Carp or Goldfish


Citi shares pop while financials head down

By Sam Mamudi
Apr 13, 2009 10:11:00 (ET)

NEW YORK (Marke****ch) -- Citigroup Inc. stock was up more than 15% in early trading Monday, even while shares of most of the biggest financial services companies were down slightly.

Citi (C, Trade ), which reports its first-quarter results later this week, has decided to include Nikko Citigroup Ltd. in its plan to sell Nikko Cordial Securities Inc. and Nikko Asset Management Co. in Japan, Kyodo News reported Monday, citing sources familiar with the matter.



Although this is one bank of many in the bunch supposedly in trouble. It represents a clear trend.

Way back when we were told of toxic assets. That the banks needed huge amounts of money to offset those bad loans. Doing some digging revealed a rarely given fact. We assumed a toxic asset was an already defaulted loan. Not true. Any loan where the borrower owed more than the value of what the loan was for was considered toxic. That includes your credit cards. See American Express.

If your bank lowered your credit card limit below your balance you were a toxic asset. If your loan is more than the current value of your home you are a toxic asset. Doesn't matter that you are still making your payments. As is the case with most people. Is it any wonder the banks are doing an about face now that the government wants to buy these so called troubled assets or toxic loans. The banks don't want to sell.

Maybe the sand in the bottom of the pool was stirred up blinding us to the truth months back. For what purpose? Political? Make things appear worse than they really are? Now that it's beginning to settle those fish swimming the financial pool may not be unwanted carp after all. Could be goldfish that a fight is beginning to brew over.

GM flat lining


GM preparing for possible bankruptcy, report says
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11:29 AM ET 4/13/09 | Marke****ch
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SAN FRANCISCO (Marke****ch) - General Motors Corp. shares fell as much as 19% in early trading on Monday in the wake of a report that the troubled automaker has been directed by the U.S. Treasury to lay the groundwork for a bankruptcy filing by June 1.

Members of President Obama's automotive task force are holding ongoing meetings and conference calls with GM officials and their advisers in Detroit and Washington, according to the New York Times, with the goal to prepare for a fast "surgical" bankruptcy.

GM (GM) has repeatedly stated that it is looking to survive the current downturn in the auto industry outside of the courtrooms.

The preparations are aimed at assuring a GM bankruptcy filing is ready if the company fails to reach a deal with bondholders to exchange roughly $28 billion in debt into equity in GM and to get needed concessions from the United Automobile Workers union.

However, the bankruptcy plan could hit a snag as key members of an ad hoc committee representing the automaker's bondholders are gearing up for a fight, The Wall Street Journal said in a separate report, citing people familiar with the strategy.


What are the bond holders going to do? Nothing. No negotiating leverage. Why is the real problem of labor being overlooked? Votes, that's why. They don't want to upset the quintessential democrat voter or point the finger of folly at them. The majority of drones out there are still under the spell of entitlement wages for the GM riveter. If not for his sake then for supporting the illusion of over compensation for all union types. Question is. Will this bankruptcy be as surgical as Obama wants? Or will GM slam all concerned in chapter 11? That depends on how much control Obama will have over the judge in the case. This assumes a BK is going down. Depends on who is bluffing and who isn't. Could be a good time to head to Detroit and leave your union card behind.

US Financials Higher Ahead Of Results;Citi, Bk Of America Gain

Apr 13, 2009 15:50:35 (ET)

By Sam Mamudi

Major U.S. financial stocks rose broadly Monday, bucking what had been a down market for much of the session, as investors' expectations grow over what this week's financial results will show.

Citigroup Inc. (C) was one of the top performers, up more than 17%.



Actually its more than that. Currently up 29% taking into account after market trading. Looks like I'm going to have a hell of a bar tab. But you gotta come to San Diego,LOL.

quote:

Originally posted by davdah:


US Financials Higher Ahead Of Results;Citi, Bk Of America Gain

Apr 13, 2009 15:50:35 (ET)

By Sam Mamudi

Major U.S. financial stocks rose broadly Monday, bucking what had been a down market for much of the session, as investors' expectations grow over what this week's financial results will show.

Citigroup Inc. (C) was one of the top performers, up more than 17%.



Actually its more than that. Currently up 29% taking into account after market trading. Looks like I'm going to have a hell of a bar tab. But you gotta come to San Diego,LOL.

Still Waiting For My Ticket Buddy!
I got friendsssssssssss!!!
LOL!!!

Take your money and shove it


DEALTALK-Goldman may repay gov't funds but not ease US grip


(For more Reuters DEALTALKS, click [DEALTALK/])

By Paritosh Bansal

NEW YORK, April 13 (Reuters) - Goldman Sachs Group Inc (GS) may succeed in its bid to pay back U.S. taxpayer money with the help of a $5 billion common share sale, but it may still not get the freedom it wants from intense public scrutiny.

Goldman, which posted a better-than-expected first-quarter profit and announced the public offering on Monday, has navigated the global financial crisis better than many of its rivals.

Its share price has more than doubled since hitting a record low in November, and is up more than 50 percent this year.

So it may be allowed to return the $10 billion it took under the U.S. Treasury Department's $700 billion Troubled Asset Relief Program (TARP), which has become a headache for recipients with oversight over compensation, expenses and acquisitions, experts said.



Ever thought you would see the day banks want to give money back? Must be toxic cash.

Inflation on the horizon


Gold falls after weak retail sales, PPI

By Moming Zhou
Apr 14, 2009 09:54:00 (ET)

NEW YORK (Marke****ch) -- Gold futures fell Tuesday, as a weaker than expected report on U.S. retail sales, along with a big drop in March producer prices, reduced the precious metal's appeal as protection against inflation.

Gold for June delivery fell $2.80, or 0.3%, to $893.10 an ounce in early North American electronic trading. Gold ended Monday's trading up more than 1%.

Investment in gold exchange-traded funds stalled, with holdings in SPDR Gold Shares (GLD, Trade ), the biggest gold ETF, remaining unchanged for a second day. SPDR gold holdings stood at 1,127.68 tons, according to latest data from the fund.

"Further resistance [in gold prices] is expected at $900," said James Moore, a precious metals analyst at TheBullionDesk.com. "With ETF investment demand still slow further significant gains may be curtailed."

U.S. retail sales dropped a seasonally adjusted 1.1% in March, after two months' of gains had boosted hopes of a rebound in consumer spending, the Commerce Department reported Tuesday.

Meanwhile, inflation at the wholesale level fell more sharply than expected in March after two second consecutive months of gains, the Labor Department reported. The producer price index fell 1.2%, driven by 5.5% decline in energy prices, including a 13.1% drop in gasoline.


Tuesday's biggest gaining and losing stocks

By Marke****ch
Apr 14, 2009 10:08:00 (ET)

NEW YORK (Marke****ch) -- Shares of the following companies were making notable moves in the U.S. stock market Tuesday:

Citigroup (C, Trade ) shares surged 12%. The banking company is scheduled to report earnings later this week.






Reading this article you would think inflation is leaving us. However, did you notice it said gas was down 13%. Is it still down? Nope, not where I'm at and I bet not where you are either. Gold is being dumped in favor of equities and economic improvements. Inflation is on the rise based on "today's" gas price. The trouble with these reports is by the time they report, the situation has already changed.

A Bull named Citi



Tuesday's biggest advancing and declining stocks

NEW YORK (Marke****ch) -- Shares of the following companies were making notable moves in the U.S. stock market Tuesday.

Advancers

Citigroup (C) shares surged 7.6%. The banking company is scheduled to report earnings later this week...



Other climbers of note, Fannie and Freddie. Yup, even the notorious twins of tenacious losses posted 4% gains today. So what does this have to do with your mortgage? If you have one and its above 5% get a refi. Save some money so you can get that big screen TV. And don't forget to charge it on your CITI master card.

Friday Mayhem


Citigroup option volume up before results, expiry


By Doris Frankel

CHICAGO, April 14 (Reuters) - Citigroup Inc (C) (C) option volume swelled on Tuesday as traders made bullish and bearish plays on the stock and adjusted positions ahead of Friday's quarterly results and April options expiration.

Citigroup was the top option name as about 2.46 million calls and 1.11 million puts traded, three times the average combined daily volume, according to option analytics firm Trade Alert.

The flurry of option activity was accompanied by sharp gains in Citigroup's stock on expectations of strong earnings, one day after Goldman Sachs Group Inc (GS) posted a better-than-expected quarterly profit.


There will be a lot of winners and losers on Friday. The consensus seems to be bullish with only 1.1 million betting the stock will flop and 2.5 million seeing it go up. The attitude is improving and enthusiasm on the rise. Even with less than favorable March sales reports the economy isn't diving as was predicted.

Its working because I won

By John O'Callaghan

WASHINGTON, April 14 (Reuters) - U.S. President Barack Obama said on Tuesday his economic measures were starting to work but government data showed an unexpected drop in U.S. retail sales in March and U.S. stocks retreated sharply.


Unexpected drop? His plan is working. Seems confusing until you dispense with the obvious. We can't assume the plan is for economic improvement. He is telling the truth and being honest. The plan is working since the economy has faltered. Now I get it.

What's in your wallet ?


UPDATE 3-Capital One credit card defaults rise; shares fall
* U.S. credit card default rate rises to 9.33 percent

* International card bad loans rise to 8.67 percent

* Shares fall as much as 10 percent (Updates stock price, adds analyst comment, Citigroup and American Express shares)

NEW YORK, April 15 (Reuters) - Capital One Financial Corp (COF), a leading issuer of MasterCard and Visa credit cards, said U.S. credit card defaults rose in March as unemployment soared, sending its shares down as much as 10 percent.

In a regulatory filing on Wednesday, the company said the annualized net charge-off rate for U.S. credit cards -- debts the company believes it will never collect -- rose to 9.33 percent in March from 8.06 percent in February. The rate for loans at least 30 days delinquent fell slightly, to 5.08 percent from 5.1 percent.

After calendar adjustments, Capital One said the U.S. card charge-off rate rose to 9 percent in March from 8.38 percent in February, while the delinquency rate was unchanged at 5.07 percent.

The default rate is getting close to the results reported last month by American Express Co (AXP) and Citigroup Inc (C), two companies with some of the worst-performing credit card portfolios.



If your limits have been lowered, this is why. In bygone days it used to be that people would go on spending sprees just prior to filing BK. Or just plain default on their cards after they got all those free toys.

The card issuers have gotten wise and are in protective mode. By lowering your limit it helps them avoid the massive losses from pre-bankruptcy activity. With nearly one in ten customers in default can you fault them?

Your credit card isn't the only worthless plastic in your wallet



UPDATE: Ford Europe Mar Sales Dn 13% On Yr; 1Q Sales Dn 16%
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9:37 AM ET 4/15/09 | Dow Jones
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(Adds details, comments.)

FRANKFURT (Dow Jones)--Ford Motor Co.'s (F) European division said Wednesday that sales were down 13% on the year in March at 163,000 vehicles in its 19 core markets as record demand for its small Fiesta model failed to offset shrinking sales of its larger cars and vans amid a weak overall market.

"It is very encouraging to see Fiesta doing so well and also our market share developing so positively, given the declining market we are continuing to face in Europe," Ford Europe's vice-president marketing, sales and service, Ingvar Sviggum, said in a statement.

In the first quarter, sales were down 16% compared with the same period last year at 352,200 vehicles.

Ford said it sold 52,800 Fiesta cars in Europe last month, the "highest retail sales month ever" for this model and making it "once more the company's best-selling car" in its 19 main European markets.

Great, but

The Ford Fiesta is a small front wheel drive supermini car designed by the Ford Motor Company and built in Europe, Brazil, Argentina, Mexico, Venezuela, China, India and South Africa. The model is marketed worldwide, including Japan and Australasia, and was sold briefly in North America. It is one of Ford's most successful cars with over ten million sold in seven distinct generations since 1976 and production continues, with an eighth generation going on sale, initially in Europe, during the Fall / Autumn of 2008. It is also set to be produced at the company’s Cuautitlán Assembly Plant in Mexico starting in late-2009.[1][2]



Did you notice where this car is not made? Right here. Might be time to ditch that union card and become a free agent.

Any news, short of Armageddon is good news.


Sector inches higher as results lift Schwab, Piper

By Greg Morcroft
Apr 15, 2009 14:14:00 (ET)

NEW YORK (Marke****ch) -- U.S. financial stocks crept into positive territory on Wednesday as better-than-expected results from Charles Schwab and Piper Jaffray lifted those shares.

Schwab (SCHW, Trade ) rose about 2%, while Piper Jaffray (PJC, Trade ) shares added 6%.

Piper on Wednesday reported that its first-quarter net loss widened to $2.7 million, or 17 cents a share, from a loss of $1.4 million, or 9 cents a share, in the year-ago period. Analysts surveyed by FactSet Research had expected, on average, a loss of 25 cents a share.

Schwab said Wednesday that its first-quarter profit fell 29% as it took a charge to cut costs and trim staff. It earned $218 million, or 19 cents a share, compared with $305 million, or 26 cents a share, in the year-ago period. Total net revenue fell to $1.11 billion from $1.31 billion.


Never before would losses cause a stock price to climb. Just imagine what would happen if they showed a real profit!

http://money.cnn.com/2009/04/1...se/index.htm?cnn=yes

JP Morgan Chase earns $2.1 billion

Although profits fell 10% from a year ago, earnings still beat expectations. CEO Jamie Dimon said bank is strong but added that bank may boost credit reserves.

Last Updated: April 16, 2009: 8:49 AM ET


NEW YORK (CNNMoney.com) -- JPMorgan Chase reported a better-than-expected profit of $2.1 billion in the latest quarter, even as the bank aggressively set aside money to cope with rising loan losses, the company said Thursday.

The New York City-based bank said its net income for the first quarter was $2.1 billion, or 40 cents a share. Profits were down 10% from a year ago, but still handily beat expectations.

Analysts were anticipating JPMorgan Chase to record a profit of $1.38 billion, or 32 cents a share, for the quarter, according to Thomson Reuters.

Bolstering the bank's results were both its consumer and investment banking divisions, but JPMorgan Chase also logged $10 billion in credit costs during the quarter, which included a $4 billion addition to its loan loss reserves.

JPMorgan Chase CEO Jamie Dimon warned that this number could go higher if the recession intensifies, but added that he was comforted by his firm's robust capital levels.

"These levels of capital and reserves, combined with our significant pre-provision earnings power, enable us to withstand an even worse economic scenario than we face today," Dimon said in a statement.

As of the end of the quarter, Chase's Tier 1 capital ratio, a key measure of a bank's ability to absorb losses, stood at 11.3%. Not including the $25 billion that the Treasury Department injected into the firm in October, Chase's Tier 1 ratio was 9.2%. A Tier 1 ratio above 8% is generally considered healthy.

JPMorgan Chase is among a handful of banks that have hinted at their interest in repaying taxpayer funds they received from the Treasury's Troubled Asset Relief Program, or TARP, given the increasing restrictions imposed on banks participating in government rescue programs.

Goldman Sachs announced earlier this week that it would sell new stock to help pay back the government. During a conference call with analysts and investors Thursday morning, Dimon said that Chase would like to repay TARP money "as soon as possible."

He added that the company was waiting for the results of the stress test that regulators are conducting on Chase and other big banks, and guidance from the government before proceeding with a return of taxpayer funds.

Dimon also said that, unlike Goldman Sachs, he did not think Chase would have to raise more capital in order to pay back the TARP money.

"I don't see why a company with [our] kind of capital would need to raise capital," he said.

Delving deeper into the results, Chase's investment banking division came roaring back from a loss in the fourth quarter and posted a profit of $1.6 billion.

The strong investment banking performance was driven by a revenue surge in its fixed income division, which reported record results in some of its operations including trading and emerging markets.

The bank's retail financial services and commercial banking divisions helped contribute to the firm's overall profit for the quarter as well, but those gains were offset in other areas.

Chase's credit card division, for example, reported a net loss of $547 million, down from a profit of $609 million a year ago. The bank cited a sizable increase in allowances for loan losses and higher charge-offs, or loans the company doesn't think are collectable.

Despite facing such issues as rising credit costs, Dimon maintained that the bank was financially strong enough to weather the current downturn, and is well-positioned for an eventual recovery.

The bank also noted that it was making "excellent progress" with its late September purchase of failed Seattle-based lender Washington Mutual.

Chase has been working hard to integrate WaMu's assets, including its nationwide retail branch network. Chase said that it had total branches of just under 5,200 as of the end of the quarter, down from 5% from late last year as it consolidated some Chase and WaMu locations.

Chase's encouraging results come on the heels of impressive numbers put up in the last week by two of its biggest rivals - Goldman Sachs (GS, Fortune 500) and Wells Fargo (WFC, Fortune 500).

Goldman Sachs reported a profit of $1.8 billion earlier this week -- which topped Wall Street estimates. San Francisco-based Wells Fargo said late last week it expected to book a record profit of $3 billion in the latest quarter, also higher than Wall Street's forecasts.

Following Chase's report, investors' eyes will now turn to two of the nation's most embattled banks - Citigroup (C, Fortune 500) and Bank of America (BAC, Fortune 500). Citi and BofA are slated to report their first quarter numbers Friday and Monday respectively.

Shares of JPMorgan Chase (JPM, Fortune 500), which are up more than 50% from lows reached earlier this year, fell nearly 3% in pre-market trading.

First Published: April 16, 2009: 6:53 AM ET

http://money.cnn.com/2009/04/1...up_quarter/index.htm

Citigroup tries to stop the bleeding

Another loss may be unavoidable for the banking giant this quarter, even as peers shine. But investors may take comfort that the worst may soon be over.

Last Updated: April 16, 2009: 2:37 PM ET


NEW YORK (CNNMoney.com) -- The latest crop of quarterly numbers from the banking industry has proven promising so far. But with every harvest, there's always bound to be a few rotten apples in the bunch.

This quarter, it's likely to once again be Citigroup.

Analysts predict that the embattled bank will be one of only a few major financial institutions to record a net loss this quarter. Citigroup is scheduled to deliver its first-quarter results before Friday's opening bell.

According to current consensus estimates from Thomson Reuters, Wall Street is forecasting a loss of $1.39 billion, or 34 cents a share.

If Citigroup does post a loss, it would be the sixth consecutive quarter of red ink. The New York City-based bank has lost more than $28 billion since the credit markets began to unravel in late 2007.

But shares of Citigroup (C, Fortune 500), which briefly traded below $1 a share in early March, have soared in recent weeks along with the rest of the banking sector. The stock was trading at about $3.80 as of Wednesday afternoon.

Part of the rise can be attributed to relatively impressive results across the rest of the industry. Goldman Sachs (GS, Fortune 500) blew past Wall Street estimates when it reported a profit of $1.8 billion earlier this week. Last week, Wells Fargo said it anticipated a profit of $3 billion this quarter, much more than expected.

Citigroup has also signaled to Wall Street that its own fortunes may be improving. Last month, Citigroup CEO Vikram Pandit wrote in an internal memo to the company's staff that the bank was profitable during the first two months of 2009.

A modest improvement in capital markets activity, a surge in mortgage refinancings and a massive gap between the rates at which banks borrow money and make loans should be a huge boon for banks like Citigroup and rivals such as JPMorgan Chase (JPM, Fortune 500) and Bank of America (BAC, Fortune 500).

So why are expectations on Wall Street for the bank to report a loss? For one thing, analysts remain concerned about Citigroup's ongoing exposure to home equity, credit cards and other consumer-related loans, which continue to deteriorate as the recession drags on and more people find themselves out of work.

"[Loan] losses will be up across the board given the mixture of a slowing economy, rising unemployment and real estate continuing to devalue," said Barclays Capital analyst Jason Goldberg.

Citigroup's decision to bulk up its reserves for future loan losses to the tune of $6 billion proved devastating last quarter. The company recorded an overall net loss of $8.3 billion.

But some worry that Citigroup may not be as aggressive enough this time around. By scaling back on the money set aside for bad loans, Citi's results would appear a bit rosier, but it could leave the company ill-prepared to cope with future loan losses.

David Trone of Fox-Pitt Kelton Cochran Caronia warned clients last week that he expected provisions this quarter to shrink to about $4 billion, while charge-offs, or loans a company doesn't believe are collectable, will climb to $7 billion.

Will Citi need more federal help?
Any upbeat numbers issued by Citigroup would help to sustain growing investor speculation that the worst may be over for the bank.

Market experts said the bank's stock may also be getting a lift because the bank could soon give more details about issuing new shares as part of the government's planned conversion of part of its investment in Citigroup to common stock.

In late February, the government said it would convert up to $25 billion of preferred shares to common stock in an effort to improve the company's capital base.

So far, the government has injected approximately $45 billion into Citigroup, making it one of the biggest recipients of government assistance during the recession. Once the conversion of the preferred shares ais complete, the government could own as much as 36% of Citigroup's common stock.

Yet, there are concerns that Citigroup could need even more aid. The Treasury Department is expected to publish the results of its so-called "stress test" of the nation's 19 largest banks once those lenders have finished reporting their first-quarter results. Citigroup is one of the banks undergoing the stress tests.

Mike McKeon, senior partner and head of the financial services practice of consultancy Booz & Company, said he did not expect regulators to give specific details about Citigroup or any bank being tested for that matter. Instead, the government is likely to give some broad industry observations based on the results of the tests.

But David Hendler, an analyst with CreditSights, told clients in a report this week that Citigroup's string of crushing losses could end sooner than many anticipate, given that the bank now has other options for improving its financial health.

Banks' funding sources have improved significantly since the Federal Deposit Insurance Corp. established its debt guarantee program last year, which backstops losses a borrower may suffer if a bank can't pay back its debt.

In addition, the Treasury's soon-to-be-launched "toxic asset" plan will allow banks to sell soured loans and securities to private investors partnering with the government.

"The smorgasbord of government initiatives aimed at assisting the banking sector could help improve the company's liquidity and earnings," Hendler wrote.

First Published: April 15, 2009: 2:59 PM ET

Refi Time


Mortgage Rates Fall This Week; 30-Yr Fixed At 4.82% -Freddie

Apr 16, 2009 10:45:23 (ET)


DOW JONES NEWSWIRES


Mortgage rates fell this week as the average rate on 30-year fixed-rate mortgages remained below 5%, according to Freddie Mac's (FRE) weekly survey of mortgage rates.

Mortgage rates have fallen in recent months as providers try to entice buyers amid the housing market downturn and the federal government's commitment to buy hundreds of billions of dollars worth of mortgages. But many consumers are wary of making the commitment to purchase a home - and many prospective buyers face challenges getting financing amid the tight credit market.

The 30-year fixed-rate mortgage averaged 4.82% for the week ended Thursday, down from last week's 4.87% average and 5.88% a year ago.


Looks like mortgage rates have bottomed out for the most part. If you haven't done it yet. It's probably time to look over your mortgage statement. Especially if you have a toxic ARM. Get out while you still can.

Getting nervous? You should be

US STOCKS OUTLOOK: GM Could Be A Wrench In The Works
Font size: A | A | A
3:10 PM ET 4/16/09 | Dow Jones
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BAC
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C
4.01 1.01%
GM
1.94 2.65%
Real time quote.

By Rob Curran

Of DOW JONES NEWSWIRES

NEW YORK (Dow Jones)--No corporation the size of General Motors (GM) is an island.

Investors may be underestimating the breadth of ramifications a GM failure would have on financial markets and what it might say about government-bailout policy, according to some market participants. Investors may get a clue on the likelihood of a filing Friday morning, when GM said it would brief the media on its restructuring progress. The government has given markets ample signals that a bankruptcy is likely, but the inevitable repercussions in the labor market and corporate-bond market - where GM was a major issuer - and for policy options on banks aren't reflected in the narrow stock-market response to those signals thus far.

GM's shares have fallen 50% from their peak on March 27, just before the Obama administration announced it wouldn't provide an endless stream of bailout money and demanded the company craft a viability plan by June 1. The Dow Jones Industrials Average, in which GM remains a member but has little weight, is up 3% for that same span, while the broad Standard & Poor's 500 is up about 4%.



Talk about a rock and hard place. If GM is forced into BK it will absolutely affect the entire market. Obama can't force feed concessions to the unions or he'll be seen as a corporate turn coat. But the unions are a big part of the reason GM is where it is. And why they are continuing to have problems getting out. A BK is very likely unless the unions take their licks without slamming Obama. Will they is the $20 billion question. I'm betting they won't. Too much union welfare for too long won't be rescinded voluntarily.

Someone Flinched


UPDATE 2-GM creditors open to "deep concessions" on debt-source
Font size: A | A | A
3:59 PM ET 4/17/09 | Reuters
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4:02 PM ET 4/17/09
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1.86 -4.12%
Real time quote.


(Adds bonds rising, stock moves, details)

By Walden Siew

NEW YORK, April 17 (Reuters) - General Motors Corp (GM) bondholders are willing to make "deep concessions" if GM can produce a viable business plan and get equal concessions from other stakeholders, a source familiar with the committee's plans said on Friday.

GM Chief Executive Fritz Henderson on Friday said the world's No. 2 automaker was preparing for a bankruptcy filing that it still hopes to avoid. The automaker, which is surviving due to $13.4 billion of U.S. government aid, suffers from massive debt and health care costs it must manage. For details, click on [ID:nN17340195]

A major sticking point is how GM can iron out agreements with major bondholders of some $28 billion of unsecured debt. GM also must devise a new plan to restructure its entire business, cut labor costs and rework the funding of a healthcare trust for United Auto Workers union retirees--all before U.S.-imposed June deadline.


Looks as though the bond holders realize they have no where to go but down. Next on the list are the unions. I can guess where that is going. Wouldn't be surprised if pro-union commercials don't start popping up. Complete with short clips of all-american families on a Sunday picnic. Union of course. Contrasted with the evil executives and corporate jets. The tag line will be something along the lines of tell Obama to support your neighbors.