Abraham Finance Blog

US Retail Sales Decline in March

2009-04-13T00:18:00.000-07:00

US Retail Sales Decline in March

http://www.reuters.com/article/rbssConsumerGoodsAndRetailNews/idUSN0954039320090409

Rising unemployment levels and recessionary trends have continued to restrict consumer spending with many large retailers reporting weak store sales in March this year. Shoppers have continued to focus on buying necessities and postponed spring purchases in the wake of late Easter holidays. While Costco reported a 5% decline in its March same store sales, it benefited from the delay in Easter in the form of one extra day of business. In contrast, specialty apparel and accessories retailers like; Zumiez, Stage Stores and Wet Seal have reported higher than expected declines in their March same store sales. To get an appropriate view of the Easter sales, one needs to look at March and April sales in a combination.

7500 General Motors Employees Lose Jobs

2009-03-30T02:30:00.000-07:00

7500 General Motors Employees Lose Jobs

http://news.bbc.co.uk/2/hi/business/7966275.stm,

While the new US administration is trying hard to revive the financial crisis in every possible way, job loss still seems to be a consistent trend.
General Motors Corporation has handed over the pink slip to 7500 hourly workers in Detroit, USA. A voucher for a new car and $20,000 in cash is what the United Auto Workers Union is receiving from their employer in return.
Early retirement benefits have also been promised to these workers. GM (General Motors) that has gained $13 billion as a loan from the US government is trying to adjust lower sales ratio by cutting on the work force.
It seems Obama was right in assessing the job crunch situation in US downturn.

Government To Boost Stake In Citi Group

2009-03-15T23:26:00.000-07:00

Government To Boost Stake In Citi Group

http://www.reuters.com/article/newsOne/idUSTRE51Q0T920090228

In its efforts to save the banking giant Citigroup, the US government aims to boost its stake in the company to 36%. In its third attempt to boost the company in the past five months, the government will convert up to $25 billion in preferred shares to common stock. Existing shareholders could see their ownership of the bank diluted by 74%. Although the latest rescue plan does not involve infusion of fresh funds into the company, it gives the government greater voting power and increased influence over its operations. Meanwhile, the bank is to make changes in its board and install new independent directors. Increased government stake in the company is expected to facilitate improved operations.

Bank Transparency Needed

2009-03-01T23:41:00.000-08:00

Bank Transparency Needed

http://www.bloomberg.com/apps/news?pid=20601068&sid=ajeAtORvjsmk&refer=economy

Banks need to take all possible steps to enhance transparency. This includes transferring toxic loans to different entities. Government guarantees and emergency aid is not sufficient to turn around the economy. The private capital market needs to become active. That is why we need transparency of assets.

The finance honchos of European Union have agreed to synchronize efforts to help banks remove toxic assets from their balance sheet. Lawmakers hailing from Washington to Berlin are trying to figure out how to clear the toxic debts that are spoiling bank balance sheets and controlling their willingness to lend. However, they also feel that the government must concentrate efforts on guaranteeing new lending and not just backstopping the bad debt.

Why Can’t We Lay Off These Layoffs?

2009-02-10T02:40:00.000-08:00

Why Can’t We Lay Off These Layoffs?

http://articles.moneycentral.msn.com/Investing/Extra/first-quarter-layoffs.aspx

It is like someone has hit the panic button. Millions are getting and have gotten laid off from their jobs where they had always felt secure. Macy’s, NEC, Hitachi, Eastman Kodak, Bon-Ton stores lead the pack in the last month’s list of companies that have laid off workers.

The pink slip has affected all areas of life including retirement planning, health insurance, job hunting and education. People are losing homes everyday as they are unable to pay the mortgage.

In such depressing times, you are bound to be vulnerable. But the advice is to keep your guard on. Why? - Because many hucksters have been found luring these laid-off workers and cheating them of their precious savings. Now, after your job, surely you don’t want to lose your savings too, do you?