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NEWS ABOUT: credit crisis

Credit Freeze Hits High Fliers of Commercial Real Estate

Slowdown plus tough credit slams office market

(Newser) - When the commercial real estate market was hot, the sky seemed to be the limit, and increasingly complicated financing arrangements were common. Now the combination of economic crisis and credit freeze has exposed the market's precarious underpinnings, which resemble the pitfalls that brought the residential real estate sector to its... More »

Japan Throws $16.7B Lifeline

The bailout aims to help smaller business outside of banking or corporate sectors

(Newser) - Following in the footsteps of America and Europe, Japan is offering $16.7 billion to companies threatened by the financial crisis, moving outside the banking sector to take equity stakes in smaller companies that otherwise can't find financing, the Financial Times reports. The 1.5 trillion yen package aims to... More »

All Options on Table in Fight to Halt Foreclosure

Obama considering moratorium, gov't-sponsored refinancing

(Newser) - The Obama administration is considering plans to stem the tide of foreclosures ranging from doubling the mortgage interest deduction to a six-month foreclosure moratorium to government-sponsored refinancing, reports the Los Angeles Times. But a strategy is still at least several weeks away and, regardless of what bandages are applied, “... More »

Thain Debacle Stings BofA Chief

(Newser) - John Thain may have lost his job running Merrill Lynch, but woe to the CEO who dared merge with him, the Economist reports. Thain no doubt trashed his reputation by failing to tell BofA chief Ken Lewis about looming losses—and handing out multimillion-dollar bonuses in the meantime—but Lewis,... More »

Thain to Leave BofA After Record Losses

(Newser) - Former Merrill Lynch CEO John Thain, who became a top exec at Bank of America when the firms merged last year, will resign from his position, CNBC reports. The move comes a week after Bank of America posted its first quarterly loss in 17 years, widely attributed to poor information... More »

Create a Good 'Bad Bank' to Ease Crisis

Institutions must write down toxic assets to ease larger woes

(Newser) - The world’s banking crisis is entering its endgame, and it’s time to shore up the most troubled institutions using a strategy that worked in Sweden in the 1990s, writes David Roche in the Wall Street Journal. It won't be easy, he warns: "A good bad bank... More »

Ex-Time Warner Chief Will Lead Citigroup

Richard Parsons, an Obama adviser, will be chair of ailing bank

(AP) - Former Time Warner CEO Richard Parsons—an economic adviser on Barack Obama's transition team—will become the new chairman of Citigroup next month. The ailing bank has suffered five straight quarters of losses and received $45 billion in government aid as it struggles to stay afloat amid the credit crisis.... More »

Prof Does Math, Finds Banking System 'Insolvent'

(Newser) - A New York University professor who predicted the current economic crisis warns that losses at US banks could climb to $3.6 trillion, leaving the whole system essentially bankrupt, Bloomberg reports. Economist Nouriel Roubini argues that since the system has a base capitalization of just $1.4 trillion, if losses... More »

NYT Courts Investment From Mexican Billionaire

Telecom magnate may get preferred stock in arrangement for battered newspaper

(Newser) - The New York Times is in talks with Mexican telecom billionaire and current shareholder Carlos Slim about making a significant investment in the beleaguered newspaper, reports the Wall Street Journal. One possibility under discussion is a preferred-stock arrangement, which would be similar to a loan. Slim's investment would earn him... More »

Circuit City Liquidation Sales Will Begin Tomorrow

Consumer-electronics chain has $1.3B in inventory to get rid of

(Newser) - Circuit City will begin the liquidation of $1.3 billion in inventory across 567 stores in special sales tomorrow, Reuters reports. The company hasn’t said anything specific on the discounts it might offer, but markdowns are likely to be deep. Gift cards from the chain will be redeemable at... More »

Senate Releases TARP Funds

(Newser) - The Senate agreed to let loose the remaining TARP funds today by a relatively slim margin, the Hill reports. The 52-42 vote means Obama should have access to the $350 billion about a week after he takes office. The House hasn't voted yet, but the TARP legislation requires only one... More »

Spielberg Pays Bills for Ailing DreamWorks

Credit crunch forces director into personal bailout for studio

(Newser) - Perhaps for the first time, Steven Spielberg is using personal funds to pay half of a $26.5 million bill his company, DreamWorks, owes ex-partner Paramount so it can keep 17 film projects under its wing. Due to cash shortages, the studio has already lost the rights to as many... More »

Feds to Give BoA Billions More for Merrill Deal

(Newser) - The feds will have to pony up billions of dollars more to help Bank of America close its deal to purchase Merrill Lynch, the Wall Street Journal reports. BoA already has received $25 billion, but Merrill's massive fourth-quarter losses have thrown a wrench in the acquisition. Henry Paulson is a... More »

Pickens, Facing Headwinds, Pushes Energy Plan in DC

Falling oil prices, stock market have taken alternative-energy push along for ride

(Newser) - Billionaire T. Boone Pickens is in Washington today to push lawmakers to breathe new life into his scheme for weaning America off foreign oil—which has suffered setbacks in recent months, the Wall Street Journal reports, not least of which are the energy and stock markets. A $100 decline in... More »

$173B Later, Taxpayers Still Can't Get a Loan

Consumer credit remains frozen, even at banks flush with bailout funds

(Newser) - Though US taxpayers own $172.5 billion of shares and warrants in 208 financial institutions, most of them still can’t get a loan. Interbank lending rates have fallen since TARP funds have been paid out, but consumer lending remains tight and average credit card rates are virtually unchanged from... More »

Vindicated in 2008, Some Experts Foresee Gloomy '09

A few who called last year's calamities correctly see grim days ahead

(Newser) - Labeled overly pessimistic for years, a few Wall Street prognosticators became the oracles of 2008 by correctly predicting the unwinding of the global economy, the Wall Street Journal reports. The doomsayers correctly anticipated bank failures, stock market declines, and the housing market collapse of the second half of 2008. As... More »

Dumbest Gaffes on the Economy

Instead of predicting financial crisis, they hid it

(Newser) - The men who should have been warning us about the impending financial crisis were a wee bit off the mark at times. MSNBC rounds up some of the dumbest things said:
  • "Subprime market problems seem likely to be contained."—Ben Bernanke, March 28, 2007
  • "The fundamentals
... More »

Pawn Shops Attract Upscale Clientele

(Newser) - Pawn shops are turning from the shady realm of the lower class to a place for rich people to get loans, the Wall Street Journal reports. The typical household income of a pawn shop customer is $29,000, but new middle- and upper-class clients are surging. One such client pawned... More »

How Iceland Went From Codfish to Meltdown

Country built a huge financial bubble based on a vulnerable currency

(Newser) - How did a chilly nation of cod fishermen play a key role in the world's crumbling financial markets? Seeking to avoid the boom-and-bust of fish catch, Iceland started by privatizing banks in the mid-1990s. It built a colossal banking system on a puny currency and attracted international deposits with high... More »

NYT Ready to Sell BoSox Stake

As newspapers tank, company offloads non-core assets

(Newser) - With revenues plummeting and advertisers and readers fleeing, the cash-starved New York Times Co is looking to offload a once-sacrosanct asset—its 17.5% stake in the Boston Red Sox and Fenway Park, the Wall Street Journal reports. Revenues at the Times Co arm that includes the Grey Lady and... More »

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