credit market

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Apple Holding Biggest Bond Sale in US History

Company will reportedly sell $17B worth

(Newser) - Apple is whipping out its proverbial credit card in a huge way. The firm intends to sell $17 billion in bonds, in what would be the biggest sale of investment-grade corporate debt in US history, sources tell the Wall Street Journal . Apple wouldn't comment on the sale or confirm... More »

Student Debtors Steering Clear of Auto, Home Loans

New Federal Reserve Bank of New York study shows declining borrowing rates

(Newser) - The well-documented and much-fretted over explosion in student loan debt could be doing serious damage to the housing market and auto industries, as graduates strive to avoid going deeper into debt, according to an analysis posted on the Federal Reserve Bank of New York's blog . For the first time... More »

Sources: Boss Tried to Hide London Whale Fiasco

JPMorgan trader was urged to boost valuations: WSJ

(Newser) - A top exec at JPMorgan appears to have tried to cover up a colossal mistake, sources close to the "London Whale" probe tell the Wall Street Journal . Emails from earlier this year reveal that credit-trading chief Javier Martin-Artajo urged "whale" trader Bruno Iksil to inflate valuations on some... More »

Moody Cut Sends Spanish Bonds to Dangerous High

Italy's borrowing costs jump as well

(Newser) - Spanish bond yields hit a whopping 7% today, after Moody's cut the country's credit rating to just one level above "junk" yesterday. The New York Times ominously notes that the 7% mark is the level that "triggered" full-blown bailouts of other eurozone countries. Moody's said... More »

Kiss Cheap Credit Goodbye

For those who can't remember 1981, rates are headed up

(Newser) - There's a generation of consumers out there that can't fathom 8% interest, much less 1981's peak of 18.2%, but the days of free or cheap money are coming to a rapid close. With national debt ballooning, inflation looming, and government props that suppressed interest rates ending, the cost of... More »

Lending Falls at Fastest Rate Since 1942

Boatload of bank failures likely in 2010

(Newser) - Banks tightened credit last year at what the Wall Street Journal calls an “epic pace,” recording their biggest full-year decline in loans outstanding in 67 years. The figure comes from a new FDIC report that paints the picture of a banking industry that, apart from a few top-tier... More »

Dubai: We Won't Bail Out Dubai World

Says it's not responsible for state-owned company's debt

(Newser) - Dubai’s government threw investors a curve ball today, saying that even though struggling Dubai World is state owned, the government won’t guarantee its debts or bail it out. Lenders “have deemed Dubai World as part of the government, and this is not true,” Dubai’s finance... More »

Dubai Knocks Dow Down 222 at Open

Debt problems send stocks tumbling in short session

(Newser) - Stocks braced for a short but ugly Thanksgiving hangover, thanks to news of big debt problems in Dubai. The Dow tumbled 222 points at the open, while the S&P fell 25 and the Nadaq 57, reports the Wall Street Journal . While US traders were enjoying their turkey yesterday, global... More »

Russian Banks Foreclose on Pigs, Lingerie

As defaults soar, banks stuck with weird collateral

(Newser) - With loan defaults soaring, Russia’s banks have had to seize a lot of collateral lately—and we’re not talking about houses. By year’s end, 20% of Russian loans could be non-performing, by Moody’s estimate. In order to recoup those losses, the banks have accepted controlling stakes... More »

Simmons Bankruptcy: Study in Private Equity Run Amok

Buyout firms profited as mattress maker saw its debt skyrocket

(Newser) - The mattress company Simmons will be filing for bankruptcy protection soon, wiping out bondholders and jeopardizing more jobs at a company that's already fired a quarter of its work force. While Simmons watched its debts balloon nearly tenfold since 1991, a string of private equity firms bought and sold the... More »

Recession Woes Penalize NFL Franchises

Overall revenues up, but some franchises lose value for the first time in a decade

(Newser) - Tight credit and the recession-driven scarcity of buyers and investors slashed the value of eight NFL teams this year, Forbes reports. It’s the first time in a decade that even one team has seen a decline. Though the average team value held steady at $1 billion, Oakland led the... More »

Credit Disparity Tells Tale of Two Recoveries

(Newser) - A fractured, polarized credit market is splitting America’s companies into the recovering and the desperate, the Wall Street Journal reports. For the mostly big companies with easy access to credit, the recovery is in full swing, but for the mostly small companies that can’t borrow, things seem as... More »

Consumers Blindsided By Card Cancellations

(Newser) - Many credit card users are getting to the register only to discover that their cards have been canceled—without a word of warning, the Wall Street Journal reports. With credit tightening, many issuers give only a cursory rationale for the drops, and then only by mail weeks later. And though... More »

Feds Probe Shady Market for Derivatives

Banks may have unfair edge in information on credit-default swaps

(Newser) - The Justice Department is probing the market for credit-default swaps, the largely unregulated derivatives that contributed to the financial crisis, Bloomberg reports. Justice is investigating whether big banks have unfair access to price information through their ownership of a private company that provides data to investors. The Obama administration wants... More »

Turnaround? Don't Get Too Giddy Just Yet

Further decline still possible, they warn

(Newser) - Signs of an economic recovery seem to be sprouting all around, but plenty of skeptics warn against starting the celebration too early, reports the New York Times. Wall Street has been on the upswing the last two months as the credit market begins to thaw and low interest rates aid... More »

Fed Bailout Spawns More 'Zombie' Banks

Fed lifelines preserve banks that, frankly, are better off dead

(Newser) - The Federal Reserve’s aggressive lending to banks has helped avert financial collapse, but it may have created some monsters as well, the Wall Street Journal reports. A research paper from the University of Chicago suggests that while federal aid has succeeded some in thawing frozen credit markets, it has... More »

Credit Crunch Pinches Entire Lending System

Undercapitalized banks stand to benefit from $1T infusion

(Newser) - Banks aren’t lending, and to change that the government is propping up not just the banks but also the vast, largely unseen financial system that fuels them, the New York Times reports. Banks rarely keep the loans they make anymore; instead, debt is packaged into securities and sold, generating... More »

Don't Be Afraid of the 'F' Word

(Newser) - Foreclosures have gotten a bad rap lately, with politicians desperate to prevent them. But foreclosures actually represent one of the best paths to recovery, writes real-estate consultant Ramsey Su in the Wall Street Journal. The people facing foreclosure would be much better served walking away from the negative-equity McMansions destroying... More »

Pfizer Deal's $22.5B in Loans Hasn't Unlocked Credit

$22.5B loan in deal to acquire Wyeth comes at 7-9% interest, and lenders can walk

(Newser) - Think Pfizer’s $68 billion deal to buy Wyeth, financed in part with $22.5 billion in loans, means credit markets have thawed? Think again, the Wall Street Journal reports. Pfizer’s lenders—including JPMorgan, Bank of America, Goldman, and Citigroup—are charging high interest (7%-9%, with loans due in... More »

25 People Responsible for the Crisis

Greenspan, King, and Clinton all played a role, the Guardian writes

(Newser) - The current recession is a wholly man-made phenomenon, the Guardian reminds us, and they’ve got the names of those responsible. Here are four from their list of 25:
  • Alan Greenspan: Fed chair for 19 years, Greenspan kept interest rates low as the housing bubble developed, backed subprime lending and
... More »

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