Page Perry's Market Monitor - March 20, 2009
There have been various developments over the past several weeks which investors may consider relevant in allocating their resources or evaluating alternatives that are available to them. Some of the more significant developments include, but are not limited to, the following:
• The Dow Jones Industrial Average opened the week at 7224 and, on Monday, fell 7 points.
• On Tuesday, the Dow Jones Industrial Average jumped 179 points.
• On Wednesday, the Dow Jones Industrial Average rose 91 points.
• On Thursday, the Dow Jones Industrial Average dropped 86 points.
• On Friday, the Dow Jones Industrial Average fell 122 points and closed the week at 7278.
• The 231 year-old Greenbrier Resort, a registered national landmark located in West Virginia, has filed for bankruptcy.
• A record number of hedge funds liquidated in the fourth quarter of 2008.
• Hedge funds may slash as many as 20,000 jobs this year according to certain sources.
• The U.S. Postal Service is eliminating jobs and is reportedly offering early retirement to approximately 150,000 workers. The Service is attempting to reduce costs by more than $100 million per year.
• United Technologies, the commercial aerospace company, plans to eliminate 11,600 jobs.
• Nokia announced that it was eliminating 1,700 more jobs worldwide.
• Federal Express announced that it would eliminate more jobs after its third quarter profits dropped 75%.
• Caterpillar has slashed 2,454 additional jobs. Caterpillar is the world’s largest manufacturer of construction and mining equipment.
• Nike is reportedly contemplating the elimination of 1,400 jobs.
• The unemployment rate for Iraq and Afghanistan veterans currently hovers around 11.2%.
• Unemployment rates in California have jumped to 10.5%. Meanwhile, the unemployment rate in Georgia has reached 9.3%.
• The top five states for mortgage fraud in 2008 were Rhode Island, Florida, Illinois, Georgia and Maryland.
• Credit card defaults in the U.S. reached their highest level in over 20 years during the month of February. American Express and Citigroup were particularly hard hit by defaults.
• The IRS is seeking to recover $226.6 million in back taxes from Allen Stafford, the billionaire accused of operating a massive Ponzi scheme.
• Used car sales and prices are reportedly on the increase as battered consumers seek alternatives to new automobiles.
• U.S. prosecutors in the Madoff Ponzi case have taken steps to seize assets in the possession of Madoff family members.
• CNN Money reports that hundreds of people in the U.S. are under investigation for operating Ponzi schemes. The Commodity Futures Trading Commission has already uncovered 19 Ponzi schemes this year.
• The IRS has established guidelines making it easier for victims of Ponzi schemes to take theft loss deductions.
• Consumer prices rose 0.4% in February, the largest increase since July, 2008.
• Continental Airlines reported that its revenue per available seat mile in February, 2009 was 12.5% lower than in February, 2008.
• The U.S. Treasury Department will provide up to $5 billion in financing to auto parts suppliers.
• The federal government’s budget deficit is predicted to hit $1.8 trillion this year.
• Thirteen of the firms receiving bailouts from the federal government, collectively, owe more than $220 million in federal taxes.
• American International Group, the recipient of over $150 billion in federal aid, has sued the government for the return of $306 million in tax payments. Talk about irony – AIG is using government bailout funds to sue the government. Something is very wrong with this picture.
• Similarly, AIG has awarded bonuses totaling $165 million to employees including much of that amount to executives responsible for the collapse of AIG and to employees no longer with the company. The absurdity continues.
• Federal regulators have taken over two corporate credit unions, U.S. Central Federal Credit Union and Western Corporate Federal Union. These credit unions provide investment and financing services to retail credit unions.
• Local newspapers may be going the way of the dinosaur. Many local papers have closed in recent months as revenues from both advertising and retail sales have dropped. The impact could be dramatic. The circulation of local and regional news, of information concerning local developments and events, and of matters of personal interest would become very limited and would have a profound impact on society.
• Many states are adopting more lenient approaches toward criminals in order to safe money on already overburdened prison systems.
Page Perry’s Market Monitor is published periodically to give investors an overview of certain recent developments impacting the economy and/or the investment markets.
