AP: World stocks gain as US bails out Bank of America

[Sapiens]

http://news.yahoo.com/s/ap/20090116/.../world_markets

...

Early Friday in the U.S., Bank of America and the Treasury Department reached an agreement for an additional $20 billion in fresh capital from the federal government's emergency rescue fund, plus guarantees against losses on up to $118 billion in troubled assets. The bank was to use the aid to help it absorb losses from its acquisition of faltering investment bank Merrill Lynch.

The deal came just hours after American lawmakers authorized a second $350 billion from the government's bailout fund amid mounting speculation that debt-laden banks would need even more rescue money. Meanwhile, allies of President-elect Barack Obama unveiled an $825 billion recovery bill — two-thirds spending and one-third tax cuts — to help jump-start the world's largest economy.

...

[c1ue]

Re: AP: World stocks gain as US bails out Bank of America

http://www.msnbc.msn.com/id/22725498/

President Bush, acknowledging the risk of recession, embraced about $145 billion worth of tax relief Friday to give the economy a “shot in the arm. “

Republican stimulus = 100% tax cuts, while Democrat stimulus = 33.3% tax cuts + 66.67% spending.

A pox on both their houses.

:mad:

[stockman]

Re: AP: World stocks gain as US bails out Bank of America

-- Bank of America came to the rescue of embattled mortgage lender Countrywide Financial Corp. Friday, announcing it would buy the company for $4 billion in an all-stock deal.
-- Bank of America on Monday began adding another slice to its growing financial services empire, buying Merrill Lynch in a $50 billion deal that would create a bank offering everything from fixed-income trading to credit card lending.
-- Bank Of America (BAC) And The Incredible Disappearing TARP Bank of America (BAC) is negotiating with the government for billions and billions of dollars to close its acquisition of Merrill Lynch. That was not how it was supposed to work. BAC was supposed to have had the balance sheet to afford both Merrill and Countrywide.
--January 16, 2009 Treasury, Federal Reserve, and the FDIC Provide Assistance to Bank of America
"Treasury and the Federal Deposit Insurance Corporation will provide protection against the possibility of unusually large losses on an asset pool of approximately $118 billion of loans, securities backed by residential and commercial real estate loans, and other such assets, all of which have been marked to current market value. The large majority of these assets were assumed by Bank of America as a result of its acquisition of Merrill Lynch. The assets will remain on Bank of America's balance sheet. As a fee for this arrangement, Bank of America will issue preferred shares to the Treasury and FDIC. In addition and if necessary, the Federal Reserve stands ready to backstop residual risk in the asset pool through a non-recourse loan.
In addition, Treasury will invest $20 billion in Bank of America from the Troubled Asset Relief Program in exchange for preferred stock with an 8 percent dividend to the Treasury. Bank of America will comply with enhanced executive compensation restrictions and implement a mortgage loan modification program."

Lewis, Kenneth
Brief Biography
Mr. Kenneth D. Lewis is Chairman, Chief Executive Officer and President of Bank of America Corporation. He has served as Chief Executive Officer since April 2001, President since July 2004 and Chairman since February 2005. He previously served as Chairman from April 2001 to April 2004 and President from January 1999 to April 2004. He also served as Chief Operating Officer from October 1999 to April 2001. He also serves as Chairman, Chief Executive Officer, President and a director of Bank of America, N.A. He has been a director of the Corporation since 1999 and is a member of the Executive Committee.
Basic Compensation

Total Annual Compensation, USD	Long-Term Incentive Plans, USD	All Other, USD	Fiscal Year Total, USD
$1,500,000	--	$12,278,200	$24,844,000

BAC 011509.png


Congratulations to Ken Lewis!!! Good men like Ken are rare today. In light of BAC's new found liquidity the board needs to immediately consider an additional exec bonus plan in order to assure retention of this forward thinking industry leader.

Shareholders... RIP

Tax Payers... bend over

'World Stocks Gain'?

[tsetsefly]

Re: AP: World stocks gain as US bails out Bank of America

In addition, Treasury will invest $20 billion in Bank of America from the Troubled Asset Relief Program in exchange for preferred stock with an 8 percent dividend to the Treasury. Bank of America will comply with enhanced executive compensation restrictions and implement a mortgage loan modification program."


Shareholders... RIP

Tax Payers... bend over

'World Stocks Gain'?

this is comical, invest??
did anyone here not see this coming???

And Merrill lynch acquisition was sold as a "positive" for shareholders, what a joke.
When exactly does someone get to say the bailouts have not worked? you would imagine with companies having to be bailed out over and over that someone might think of doing something different...

[GRG55]

Citi Splits into Good Bank, Bad Bank...

This is helping the equity market response. The government to the rescue, yet again. Doesn't it feel good now that everything is fixed? :rolleyes:
[and just before Hank leaves office too!]

Citigroup loses $8.29 billion, splits in two

Fri Jan 16, 2009 6:42am EST
NEW YORK (Reuters) - Citigroup Inc unveiled a broad restructuring plan designed to shed weaker businesses and troubled assets, and also reported an $8.29 billion fourth-quarter loss, its fifth straight quarterly loss...

...The bank said it was splitting into two operating units, one of which will focus on universal banking, the other on brokerage and retail asset management, local consumer finance, and a pool of assets that require special management...


Citigroup Reports $8.29 Billion Loss, Completing Worst Year

Jan. 16 (Bloomberg) -- Citigroup Inc. posted an $8.29 billion fourth-quarter loss, completing its worst year, as the credit crisis eroded mortgage-bond prices and customers missed more loan payments...

...“Any new solution is likely to need an incremental infusion of common equity, either from the government, private investors or the public markets, any of which is likely to be dilutive to existing Citi shareholders.”

[GRG55]

Re: AP: World stocks gain as US bails out Bank of America

this is comical, did anyone here not see this coming???

And Merrill lynch acquisition was sold as a "positive" for shareholders, what a joke.
When exactly does someone get to say the bailouts have not worked? you would imagine with companies having to be bailed out over and over that someone might think of doing something different...

They are doing something different. Next week Hank, George, Dick and the rest of the gang pack their boxes and get out of Dodge...and somebody else gets to piss away your money...

House to seek $825 billion in economic stimulus

Thu Jan 15, 2009 3:20pm EST

WASHINGTON (Reuters) - Democratic leaders in the House of Representatives unveiled an $825 billion tax cut and spending bill on Thursday they hope will help President-elect Barack Obama reverse the steep decline in the U.S. economy.

The bill, which would add to an already massive $1.2 trillion budget deficit forecast for this year, would combine $550 billion in emergency spending initiatives with $275 billion in temporary tax benefits over the next two years.

The goal of the legislation, according to House Speaker Nancy Pelosi, a California Democrat, is to create and save up to 4 million jobs in an economy that has suffered through a recession for more than a year...

Here's the funniest line of all...

..."We wanted to get the biggest bang for the buck of every dollar spent without having the package be so big that it's weighed down" with unnecessary deficit-spending, Pelosi said...

And having saved jobs, they are about to turn their attention to doing what Hank and Ben apparently couldn't...saving the banks...

U.S. ‘Bad Bank’ Plan Gets Momentum to Revive Lending

Jan. 16 (Bloomberg) -- Renewed questions about U.S. banks’ viability are pushing regulators toward a new plan that would remove toxic assets from bank balance sheets, in what may become the biggest effort yet to unfreeze lending.

President-elect Barack Obama’s advisers see an increasingly grave banking crisis and are considering proposals far more sweeping than any steps that have been taken so far, according to people who’ve discussed the outlook with them...

...Federal Reserve officials are focusing on the option of setting up a so-called bad bank that would acquire hundreds of billions of dollars of troubled securities now held by lenders. That may allow banks to reduce write-offs, free up capital and begin to increase lending. Paul Miller, a bank analyst at Friedman Billings Ramsey & Co. in Arlington, Virginia, estimates that financial institutions need as much as $1.2 trillion in new aid.

Other steps that may be under consideration include providing further guarantees for toxic assets that remain on the banks’ books, as officials did for Citigroup Inc. in November and with a $118 billion backstop for Bank of America Corp. today, or purchasing selected investments.

Federal Deposit Insurance Corp. Chairman Sheila Bair yesterday played down the alternative of nationalizing lenders.

A move could come soon after Obama is sworn in on Jan. 20. Adding urgency to the deliberations is a deepening slide in financial shares. Citigroup yesterday sank below the level it reached when regulators mounted a rescue of the lender in November. Bank of America fell to an 18-year low as the company sought more aid from the government...

[*T*]

Re: AP: World stocks gain as US bails out Bank of America

Anyone who questions the utility of technical analysis should look at that chart.
Note the entirely predictable rally to kiss the moving average goodbye...

[GRG55]

Re: AP: World stocks gain as US bails out Bank of America

...Bank of America on Monday began adding another slice to its growing financial services empire, buying Merrill Lynch in a $50 billion deal that would create a bank offering everything from fixed-income trading to credit card lending...

Lewis, Kenneth
Brief Biography
Mr. Kenneth D. Lewis is Chairman, Chief Executive Officer and President of Bank of America Corporation. He has served as Chief Executive Officer since April 2001, President since July 2004 and Chairman since February 2005. He previously served as Chairman from April 2001 to April 2004 and President from January 1999 to April 2004. He also served as Chief Operating Officer from October 1999 to April 2001. He also serves as Chairman, Chief Executive Officer, President and a director of Bank of America, N.A. He has been a director of the Corporation since 1999 and is a member of the Executive Committee.
Basic Compensation

Total Annual Compensation, USD	Long-Term Incentive Plans, USD	All Other, USD	Fiscal Year Total, USD
$1,500,000	--	$12,278,200	$24,844,000

...Congratulations to Ken Lewis!!! Good men like Ken are rare today. In light of BAC's new found liquidity the board needs to immediately consider an additional exec bonus plan in order to assure retention of this forward thinking industry leader.

Shareholders... RIP

Tax Payers... bend over

'World Stocks Gain'?

Wasn't this the same person that said he had as much fun as he could stand in investment banking, just months before buying...Merrill, an investment bank?

Why he still has a job is completely beyond comprehension.

[vinoveri]

Re: AP: World stocks gain as US bails out Bank of America

Metalman, can you pass the puke bucket this way whenever your finished with it(after you've washed it, of course):eek:

[grapejelly]

Re: AP: World stocks gain as US bails out Bank of America

http://www.msnbc.msn.com/id/22725498/



Republican stimulus = 100% tax cuts, while Democrat stimulus = 33.3% tax cuts + 66.67% spending.

A pox on both their houses.

:mad:

I will take tax cuts any day

[c1ue]

Re: AP: World stocks gain as US bails out Bank of America

GJ,

Will you take tax cuts along with a halving of the value of the dollar?

How about 30% tax decrease with 100% price increases?

[grapejelly]

Re: AP: World stocks gain as US bails out Bank of America

GJ,

Will you take tax cuts along with a halving of the value of the dollar?

How about 30% tax decrease with 100% price increases?

We're screwed one way or the other...I'll take the tax cuts. At least it puts somewhat of a throttle on what the government can spend. Kind of. A little.

[c1ue]

Re: AP: World stocks gain as US bails out Bank of America

We're screwed one way or the other...I'll take the tax cuts. At least it puts somewhat of a throttle on what the government can spend. Kind of. A little.

Eh? a throttle? I thought $8.5T went out the door already, with another $825B already in progress.

When are the brakes kicking in?

Oh yeah, there are none. Power to the printers!

[stockman]

Re: AP: World stocks gain as US bails out Bank of America

"What Do Bank Insiders Know?" http://www.cnbc.com//id/28774201

"Some investors think the banking sector may have been badly oversold on Tuesday. They point to comments from FDIC Chairman Sheila Bair who told CNBC that the country's banking system remains sound, even amid the negative news.If that's the case, at least some bank stocks might be cheap.

For your consideration, the fact that several Bank of America directors and CEO Ken Lewis purchased more than 513,000 shares of common stock Tuesday. At least some market watchers see the move as a show of confidence in the firm."




A VOTE of confidence by KEN LEWIS... betting 2 WEEKS PAY that the company won't be nationalized.

[GRG55]

Re: AP: World stocks gain as US bails out Bank of America

"What Do Bank Insiders Know?" http://www.cnbc.com//id/28774201

"Some investors think the banking sector may have been badly oversold on Tuesday. They point to comments from FDIC Chairman Sheila Bair who told CNBC that the country's banking system remains sound, even amid the negative news.If that's the case, at least some bank stocks might be cheap.

For your consideration, the fact that several Bank of America directors and CEO Ken Lewis purchased more than 513,000 shares of common stock Tuesday. At least some market watchers see the move as a show of confidence in the firm."




A VOTE of confidence by KEN LEWIS... betting 2 WEEKS PAY that the company won't be nationalized.

At this moment BAC stock is down nearly 14% today, accelerating the loss into the close. Neither the bank's management and Board, nor the US Treasury Dept. give a damn about the common equity shareholders. That was plainly clear with the decision to go ahead with the Merrill deal. My bet is this bank eventually gets nationalized [too big to fail] and the current common equity holders get wiped out completely.