credit market

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Stocks Plunging, Russia Closes Market

Micex falls 10%

(Newser) - Russia shut down trading for the second day in a row after the benchmark Micex index plummeted 10%, Bloomberg reports. The Finance Ministry announced that it was pouring $44 billion into Russia’s three top banks, Sberbank, VTB, and Gazprombank. But foreign investors have pulled $35 billion from Russia’s...

Why AIG Got a Bailout (and Lehman Didn't)
 Why AIG Got a Bailout 
 (and Lehman Didn't) 
ANALYSIS
Sep 17, 2008 7:40 AM CDT

Why AIG Got a Bailout (and Lehman Didn't)

Credit default business dooms, saves giant

(Newser) - The Federal Reserve seemed to draw a hard line against bailouts with Lehman Bros., but just days later it stepped over that line to save AIG. Why?  First, says Time: Size. Its implosion would have been "as close to an extinction-level event" as we've been since the Depression. But...

Wall Street Rumbling Means Little on Main Street

Financial meltdown has small effect on 'real economy': Kaletsky

(Newser) - Fannie and Freddie have been nationalized, Lehman has collapsed, Merrill Lynch has been bought out—an economic disaster, right? Not really, Anatole Kaletsky writes in the Times of London: The US economy is actually showing signs of improvement. More than ever, "there is no contradiction between expecting a recovery,...

Tough Times Ground Hedge Fund High-Fliers

Specialized investment industry dragged back to earth by shaky market

(Newser) - The recent market turmoil has taken a good deal of the shine off of hedge funds, as managers are unable to reproduce their heretofore exemplary results in poor market conditions, the New York Times reports. The average hedge fund lost 4% this year, the worst overall results in the industry’...

Rent-to-Own Leases Help Fill Up Condos

In slow market, some developers offer test drives to renters

(Newser) - The credit crisis landed the housing market on shaky ground, but condo developers are attracting cash-strapped buyers by offering them rent-to-own leases, the Boston Globe reports. The deal allows would-be homeowners to rebuild their credit and test out conditions, while developers make money on properties that otherwise would be empty....

Morgan Stanley Cuts Off Home Equity Lines

Thousands whose homes' value has fallen see credit frozen

(Newser) - Morgan Stanley has told thousands of its home-equity credit clients they can no longer draw on the lines, Bloomberg reports. Most had property values that had fallen, and were frozen to cut back on risk, a source said. A Morgan Stanley spokesman confirmed that “a segment of clients” had...

Credit Crunch Squeezes Student Loans

As private funds dry up, families look to feds to pay for college tuition

(Newser) - The slump in the credit markets has shrunk capital available to brokers of student loans, complicating the already-difficult task of financing a college education. The Boston Globe relates the story of one Massachusetts family, the Ferragutos, who received word this year from the state’s education finance agency informing them...

Public Silence Greets Wall St. Blunders
Public Silence Greets Wall St. Blunders
OPINION
Jul 19, 2008 3:10 PM CDT

Public Silence Greets Wall St. Blunders

Small savers are suffering, but giving financiers a free ride

(Newser) - America's financiers have driven the country into crisis with stunning recklessness, James Grant writes in the Wall Street Journal, but public anger seems strangely dormant. Populist politicians railed against Wall Street during past financial crises, Grant notes, but today's politicians appear largely uninterested in taking aim at the easy target.

Fannie, Freddie Edge Back From the Brink
Fannie, Freddie Edge Back
From the Brink
ANALYSIS
Jul 12, 2008 7:11 AM CDT

Fannie, Freddie Edge Back From the Brink

Panic eases after turbulent trading, but big test is yet to come

(Newser) - Fears of a collapse of Fannie Mae or Freddie Mac finally eased yesterday after a stomach-churning rollercoaster ride that saw a 50% nosedive for the mortgage giants in early trading, writes the Wall Street Journal. A week of panic, prompted in part by reports that the government was preparing rescue...

Fannie, Freddie Plunge Gives Short Sellers a Field Day

Very quietly, the sharks are making a killing

(Newser) - With the rest of the world wringing its hands over fears of a Fannie Mae or Freddie Mac collapse, one tribe on Wall Street is smiling: the short sellers. Investors have bet against Fannie and Freddie in growing numbers as the two mortgage lenders' positions grew more precarious. But handsome...

Angel Investors Profit From Slumping Markets

Affluent investors increase investments, despite market downturn

(Newser) - The bearish market hasn't stopped angels from acting like bulls, Portfolio reports. Angel investors, those who fund start-ups and small companies, are profiting from Wall Street's woes: Reduced private equity funding has made angels the go-to source for capital, improving their bargaining position and giving them more chances to invest.

Foreclosures Go Upscale
 Foreclosures Go Upscale 
May 15, 2008 10:11 AM CDT

Foreclosures Go Upscale

It's taken longer for ballooning loans to hit the wealthy, now facing the music

(Newser) - Luxury homes—once seemingly immune from the mortgage crisis—are starting to hit foreclosure lists across the nation, the Washington Post reports. And, real-estate agents predict, it’s just the beginning of a trend likely to grow as more buyers who bought beyond their means with adjustable-rate and interest-only mortgages...

Recession Fears Overblown: Economists

Fed's actions key strong economic reports, signs of market recovery

(Newser) - A growing number of economists are saying, cautiously, that the US might have pulled back from the brink of recession, the Wall Street Journal reports. The experts credit swift action by the Federal Reserve to lower interest rates and save Bear Stearns in March, and even the ongoing distribution of...

Banks Face New Loan Crisis: Rebuilding Reserves

'Provisions' may turn out not to be large enough

(Newser) - Within Bank of America’s disappointing first-quarter earnings was an unwelcome harbinger for the banking industry, the Wall Street Journal reports. BofA’s results were dragged down by huge additions to its loan-loss provision, an expense many other banks will also record soon. Given current credit conditions, many banks will...

Citigroup Posts $5B Loss, Will Cut 9,000K Jobs
Citigroup Posts $5B Loss,
Will Cut 9,000K Jobs
updated
Apr 18, 2008 7:56 AM CDT

Citigroup Posts $5B Loss, Will Cut 9,000K Jobs

News is worse than expected for nation's largest bank

(Newser) - Citigroup reported a first-quarter loss of $5.1 billion today, posting another $14 billion in writedowns as a result of the credit crunch and loan defaults, the Wall Street Journal reports. The loss of $1.02 a share exceeded analysts' estimates and marks the second straight quarterly loss for the...

Banks Need to 'Fess Up on Risk: G7 Panel

Forum of regulators says transparency needed to end crisis

(Newser) - Top financial regulators today challenged banks to come clean about risks they face, the Wall Street Journal reports. The Financial Stability Forum, a worldwide team of financial honchos—including several central bank chiefs—concluded that “hording of liquidity” was leading to “severe strains” in the lending market. Only...

$19B Buyout of Clear Channel Nearly Dead

Credit woes have sale of radio giant to private firms crumbling

(Newser) - A $19 billion bid to privatize Clear Channel appears likely to fall through as buyers and financiers bicker—with credit-crunch-induced liquidity woes a major stumbling block, the Wall Street Journal reports. A credit agreement between private equity firms and the banks funding the move has become shaky. “No one...

Bernanke Looks Impotent as Fed's Fixes Fail

Economic woes may be beyond cure by monetary medicine

(Newser) - Ben Bernanke has employed virtually every tool in the Federal Reserve's kit to calm markets panicked by the credit crisis, but hasn't scored any more than temporary rallies, Bloomberg reports in a look at the markets' fading faith in the Fed chief—and the Fed itself. "The Fed has...

Bernanke Tosses Out His Rule Book

As Wall Streets meltdown accelerates, the Fed chief adapts on the fly

(Newser) - With a recession and worsening meltdown on Wall Street looming, Fed chief Ben Bernanke has dumped textbook central bank economic policy, reports the New York Times. Last week's bailout of Bear Stearns, for example, seemed to fly in the face of his previous reluctance to rescue big institutions. And it...

As Margin Calls Mount, Carlyle Holds 'Crisis Talks'

Private equity giant's subsidiary imperiled

(Newser) - The Carlyle Group is holding emergency talks with lenders to try to save its drowning Carlyle Capital division, the Washington Post reports. Creditors have decided that Carlyle’s portfolio of traditionally safe mortgage-backed securities holdings isn’t good enough in the current market, and they're demanding $400 million more in...

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