WASHINGTON – Add New York to the growing list of states where gas prices are topping $4 per gallon.
On Sunday, the Empire State became the sixth state to top $4 for the average price of a gallon of gas, joining Alaska, California, Connecticut, Hawaii and Illinois, according to AAA's Daily Fuel Gauge. The average price of gas also rose to more than $4 per gallon in Washington, D.C., on Saturday.
The next states to join the list could be Michigan, which has gas for $3.95 per gallon on average, and Indiana, where the average price is $3.94. Nevada, Washington and Wisconsin are close behind.
Hawaii has the highest price in the U.S. at $4.48 per gallon. Wyoming has the lowest, at $3.54.
source: http://news.yahoo.com/s/ap/us_gas_prices
The national average for gas has increased for 26 straight days, and is now at $3.83 per gallon. That's up 29 cents from a month ago. Retail surveys suggest motorists are reacting to higher prices now by buying less fuel. Still, the government expects pump prices to keep climbing this summer as vacationers take to the highways.
For American drivers, the $4 mark harkens back to the summer of 2008, when oil rose to $147 per barrel and gas prices topped out at $4.11 per gallon before the economy went into a tailspin.
The rapid increase at the pump follows a parallel rise in oil. Since Labor Day, oil has risen 48 percent and U.S. gas prices have gone up 42 percent. The increases gained momentum in mid-February when a popular rebellion in Libya turned violent and shut down the country's exports. Crude has jumped 30 percent since then, with gas prices gaining 22 percent.
Sunday, April 17, 2011
Gas in 6 states, nation's capital tops $4 a gallon
Monday, April 11, 2011
How To Select An Affordable Jail Bonds Service
If you have to face a lawsuit, whom would you look for help? A professional bail bonds service can help your overcome the legal hurdle most efficiently.
If you have to face a lawsuit, whom would you look for help? A professional bail bonds service can help your overcome the legal hurdle most efficiently. If you are being arrested on criminal charges, you will be taken into custody. Jail bonds can help you avert this embarrassment. With proper backup from a bondsman you can ensure to obtain bail from the judiciary at the earliest.
A magistrate or a judge usually issues bail and settles the jail bond amount. It is dependent on a number of factors as well, most importantly- the severity of the crime for which the person is being charged and the judiciary's assessment of the accused and his/her likelihood to abscond. After settlement of the bail amount the accused individual can pay that amount and escape the humiliation of staying behind the bars till the trial is over. In other words, a bail is a contract between the accused and the judiciary by which the court allow the accused to remain free on the condition that he/she will make his/her appearance in all court proceedings until the case is settled in the house of law.
But what happens if you have to pay a jail bond amount that is well beyond your affordable limit? In such a situation bail bonds services come handy. Bondsman or jail bond agents will help you to meet the expenses of securing a bail from the court. A professional bail bond service will act as your guarantor and convince the court to issue you a jail bond on the condition that you will be present at all the courtroom sessions in person and will not flee!
However, if you wish to assist someone you know to secure bail by volunteering your assets, do not expect to get it back once the accuser makes his/her first court room appearance. Jail bonds guarantee that the person charged will attend all courtroom sessions until the matter is settled and further, the assets used in getting the jail bond won't be available till the conclusion of the case.
When it comes to selecting a proficient jail bonds service provider, you must look for the following traits before the selection-
1. The bandsman or the service provider must be quick to respond.
2. A professional bail bond service will help you secure bail in a confidential way as well.
3. The bondsman service agents should be proficient enough to resolve problems. They must be well connected with the legal authorities to help approve the bail at the earliest.
4. Above all, they must be experienced, honest, and reliable.
While selecting an experienced bondsman who can help secure jail bonds, Smyrna, TN residents need not look any further. Affordable Bail Bonds offers the best professional jail bonds service to Tennessee residents.
Easy Personal Loan or Bank Trap for you
Most of you have heard, read, or seen on tv about Easy Personal Loan. more & more banks are offering these loans Ge countrywide, icicibank, hsbcbank, even citibank, previously they gave loans to only professionals like doctor's engineer's but now through citifinancial they are giving loans to people who are earning 4000/- or more per month the documentation are quite simple any ordinary person can meet their criteria Most of you have heard, read, or seen on tv about Easy Personal Loan. more & more banks are offering these loans Ge countrywide, icicibank, hsbcbank, even citibank, previously they gave loans to only professionals like doctor's engineer's but now through citifinancial they are giving loans to people who are earning 4000/- or more per month the documentation are quite simple any ordinary person can meet their criteria but the intrest rates are very high and the method of recovering the loan incase of default is illegal.
Are these loans really easy.
I suggest you never take a loan on a flat intrest rate as flat intrest rate's rip you off. only take a loan if you really
require it. Never take a loan for going on a vacation or for entertainment or any other reason Many people take loan and invest that in stock market, forex market or in any other investment scheme hoping to get higher returns but they under estimate the risk that if things go wrong the result would be worst. a few days of enjoyment and 36 months of loan repayment headache.
Check out these facts before you apply for one
They charge you a flat intrest rate of 20 to 36 % per year
They add you to defaulter's list and add your name to CIBIL so that you credit get's spoiled and you cannot avail any further loan
In a flat rate of intrest you continue to pay the same amount of intrest per month until you loan get's paid
this means your basic amount lowers every month but the intrest rates remain the same
For example if you take a loan of rupees 30,000/- for 36 months @ 20% per year they will charge you 18,000/- intrest
they will divide it ino Equated monthly Installments.(EMI) you basic amount keeps on decreasing but you pay the same intrest rate till the end of 36 months & besides that they will deduct processing fees from your basic loan you will only get around 27,000/- if you apply for a 30.000/- loan
They charge 300 - 500 rupees if your installment chq. bounces
They charge you 300 - 500 rupees late payment or penalty
They send goondas if you don't pay on time.
So Do you require an easy loan
This article is written by freshnewsin.com you can use this article on your site with this resource box intact www.freshnewsin.com.
The Best and Largest Banks in Asia
United Overseas Bank (UOB is one of the leading banks in Singapore and Asia, offering a wide range of financial services including personal financial services, private banking, trust services, commercial and corporate banking, corporate finance, capital market activities, treasury services, asset management, venture capital management, and more. It has been ranked 'Asia's Third Strongest Bank' and the 'Strongest Bank in Singapore' by Asiamoney, as well as the 'Best Bank in Singapore' by Global Finance magazine.
Industrial and Commercial Bank of China Limited (ICBC) is the largest bank in the world by market capitalization. The bank is a market leader in China in many business areas of commercial banking. It has received many awards form publications and intermediary organizations in the world such as Global Finance, The Asset, Asian Banker, and so on. ICBC is ranked top of all financial institutions in the Millward Brown Optimor's 2009 ranking of Top 100 Most Valuable Brands.
Korea Exchange Bank (KEB) is one of the largest banks in Korea measured in assets and the largest foreign exchange bank in Korea. It has won 'Achievement Awards' for Trade Finance and Cash Management from The Asian Banker. The Bank's Customer Service Center was recognized as the best call center in Korea in the 2010 Korea Service Quality Index (KSQI) survey conducted by Korea Management Association Consulting (KMAC).
Bangkok Bank is the largest bank in Thailand and has the largest overseas branch network of any Thai bank. It has one of the most extensive international networks in Asia, with branches located in China, Japan, Hong Kong, Taiwan, Vietnam, Indonesia, the Philippines, and so on. Bangkok Bank has won the prestigious leadership awards from The Asian Banker, namely the overall most Promising Young Banker award in the Asia Pacific and the Talent and Leadership Development Award.
ICICI Bank is one of the biggest banks in India, offering a broad range of banking products and services to corporate and retail customers through a variety of delivery channels and through its specialized subsidiaries in the areas of investment banking, life and non-life insurance, venture capital and asset management. The Bank has won the "Banking Technology Awards 2010" at The Indian Banks Association in a number of categories including the Best Financial Inclusion Initiative, Best Online Bank, Best use of Business Intelligence, and Technology Bank of the year.
Sunday, October 31, 2010
Debt Busters!
Strategy: Live without the little things
Advice: Don't go too far -- like trying cloth diapers to save $60
My wife and I owed $18,000 in student loans, $6,000 in car loans, $2,000 in credit cards and $152,000 in my mortgage.
We were living paycheck to paycheck and I was tired of seeing my bank account zero out every month. So we wanted to get out of as much debt as possible as soon as possible. We started by saving an extra 1/12th of our total required expenses -- like mortgage, utilities and Internet -- each month, in order to have one month worth of bills saved up at the end of the year. Then we got excited and doubled that. In three years we had six months of living expenses and threw that into a high interest CD at 5%. That really got us going, seeing the money grow -- and we became obsessed with eliminating debt.
We just really took a look at what we need and only spending money on those things. I used to eat out a lot and that cost me $200 a month. Now we invite friends to "eat-in" at our house. We have a garden and purchase produce from co-op programs. Before we became debt-obsessed we would also get nice Christmas gifts for each other, but now we limit each other to $50.
Now, if there's something we want we put it on our "Dream Board," a cork board by our bedroom door that we see everyday. And it will stay there until we're debt free. It also has the loan schedule for our house, and each month we scratch off a month. Next to the schedule, we post our ultimate "want" that we agree to purchase -- with cash of course -- once our house is paid off. I have a 2010 Camaro waiting for me.
Cutting back so much has been hard, but we've learned a lot along the way. My wife learned some things are worth paying more for after trying to use cloth diapers -- which most people use as burp rags -- pinned inside training pants with plastic pants over them for our two kids, all so that she could reuse the diapers and not spend $60 a month on Pull-ups. As a result they both got horrible rashes, so we switched to a cheaper brand of regular diapers.
Altogether, we've paid off around $90,000 since 2005.
Sunday, July 5, 2009
Apartment Building Cash Flow System.
Yes, You CAN Become a Real Estate Millionaire!
Give Me a Few Minutes of Your Time and I'll Show You EXACTLY How!
From Monica Main
Real Estate Wealth Expert
Thursday -- 3:48 p.m.
Dear Future Real Estate Tycoon,
How are you? My name is Monica Main and I'm a self-confessed business opportunity junkie. If you've seen it on late night TV, I have it! Any "system" - from Ron Legrand, John Beck, Carleton Sheets, John T. Reed, Russ Whitney, Robert Allen - I HAVE! I even bought Carleton Sheets' course TWICE! (I couldn't go without the "new and improved" version.) I even have Dave del Dotto's and Tommy Woo's courses from way back when. (Do you remember those two?)
Did any of these get-rich-quick "systems" really work? Yes and no. Some gave me good ideas but NONE were "complete" from start to finish. I had to "cut and paste" from each system to get 70% of what I needed to become successful in real estate. Unfortunately, the other 30% was missing! Then, even worse, I had to "throw out" the 70% I learned and start over from scratch.
Yes, I wanted more than anything to make tons of money with real estate. I knew that owning real estate was the most PROFITABLE way to make money because real estate will never go away and it will ALWAYS keep going up in value. I don't care how "soft" the market is now. Fifteen years from now property will be AT LEAST DOUBLE what it is now. Also, every multi-millionaire, no matter how they made their millions (or billions), owns LOTS OF REAL ESTATE!
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"From $250,000 in Debt to a $3,000,000 Net Worth!"
| "My wife has a rare medical condition that tapped us out financially. We had hundreds of thousands of dollars in medical debt and I truthfully didn't see any way out but bankruptcy. I was already investing in property. I had 4 single family homes but the monthly cash flow was pitiful. It was only $320. I believed in real estate but knew there had to be another way! | |
| After finding your secret system I was able to convert those 4 homes into 1 apartment building with 56 units that allowed us to go from a pitiful $320 per month in cash flow to $14,580 per month in cash flow. I ended up doing another 3 deals. One of the buildings I used to flip for cash and paid off all of the medical bills PLUS had $65,000 left over. All I did with the building was paint it and put on a new roof and I was able to resell it for more than $300,000 in profit within a couple of months! And this is just the beginning! Thank you for everything and God bless!" -- Tracy and Ken McNeill of Destin, FL | |
Wednesday, March 11, 2009
World's Billionaires 2009
World's Billionaires 2009
 © Alex Wong/Getty Images | 12. S. Robson Walton Net Worth: $17.6 billion Source: Wal-Mart/U.S. Age: 65 Marital Status: Divorced, remarried; three children |
- Wal-Mart remains the exception to the rule in the crumbling retail sector, thanks to its global footprint and deeply discounted prices. Also helping: the exodus of competitors like Circuit City and Linens 'n Things.
 © Star Telegram/Blackwell/Sipa Press | 12. Alice Walton Net Worth: $17.6 billion Source: Wal-Mart/U.S. Age: 59 Marital Status: Twice divorced |
- Wal-Mart remains the exception to the rule in the crumbling retail sector, thanks to its global footprint and deeply discounted prices. Also helping: the exodus of competitors like Circuit City and Linens 'n Things.
- Shares down 25% since September.
- Fourth-quarter profit hurt by lawsuit settlements, poor currency exchange; still beat analyst expectations.
- Stake in solar-paneling outfit First Solar fared far worse; shares down 60% since August after surging 120% in previous 12 months.
- Sam Walton started as J.C. Penney clerk in 1940; opened Newport, Ark., five-and-dime store Benjamin Franklin five years later. Lost lease in 1950.
- With brother James started general store chain in Bentonville, Ark., in 1962.
- Today Wal-Mart is world's largest retailer: 7,200 stores, 2 million employees serve 200 million customers. Sales: $378 billion.
- Alice's Crystal Bridges art museum in Bentonville under construction. Collection already growing; acquisitions include Sargent's "Robert Louis Stevenson and His Wife," Benton's "Ploughing It Under."
 © L. Matthew Bowler | 12. Christy Walton & family Net Worth: $17.6 billion Source: Wal-Mart/U.S. Age: 54 Marital Status: Widowed, one child |
- Wal-Mart remains the exception to the rule in the crumbling retail sector, thanks to its global footprint and deeply discounted prices. Also helping: the exodus of competitors like Circuit City and Linens 'n Things.
- Shares down 25% since September.
- Fourth-quarter profit hurt by lawsuit settlements, poor currency exchange; still beat analyst expectations.
- Stake in solar-paneling outfit First Solar fared far worse; shares down 60% since August after surging 120% in previous 12 months.
- Sam Walton started as J.C. Penney clerk in 1940; opened Newport, Ark., five-and-dime store Benjamin Franklin five years later. Lost lease in 1950.
- With brother James started general store chain in Bentonville, Ark., in 1962.
- Today Wal-Mart is world's largest retailer: 7,200 stores, 2 million employees serve 200 million customers. Sales: $378 billion.
- Christy is the widow of John Walton (died 2005); donated seven-acre San Diego home to Cross Border Philanthropy.
 © Sipa/AP Images | 15. Bernard Arnault Net Worth: $16.5 billion Source: Luxury goods/France Age: 60 Marital Status: Divorced, remarried; five children |
- France's richest man lost $9 billion in the past year, as shares of his $22 billion (sales) luxury goods group, LVMH Moët Hennessy Louis Vuitton, dropped 29%.
- Sailing into new waters: bought Princess Yachts, one of Britain's oldest luxury motorboat manufacturers, last summer; picked up yacht builder Royal van Lent soon after.
- Via his investment arm, Groupe Arnault, owns French tour operator Go Voyages and has a stake in French retailer Carrefour.
- Built Le Cheval Blanc in French ski resort town of Courchevel, where he often likes to spend New Year's Eve.
- Also owns two wineries with good friend, Belgian billionaire Albert Frere.
- Father made small fortune in construction; Arnault put up $15 million from that business to buy Christian Dior in 1985. Still a family affair, as both son Antoine, 31, and daughter, Delphine, 33, sit on LVMH's board.
- Wife is a concert pianist; Arnault himself reported to be an excellent piano player.
 © Ted Aljibe/AFP/Getty Images | 16. Li Ka-shing Net Worth: $16.2 billion Source: Ports, retail, energy/Hong Kong Age: 80 Marital Status: Widowed, two children |
- Net worth of Hong Kong's "Superman" is down $10 billion in the past year, as stock of his publicly traded conglomerates Cheung Kong and Hutchison Whampoa tumbled.
- The two companies are about to start construction on a property project in Shanghai, China.
- HW's retail group plans to open 120 stores in China in 2009.
- Through the two companies, Li is world's largest operator of container terminals, world's largest health and beauty retailer by number of outlets, a major supplier of electricity to Hong Kong, and a real estate developer.
- His second-largest holding: Canadian oil firm Husky Energy, which cut spending by almost a third for 2009.
- Charitable foundation recently raised $510 million by selling 40% of its stake in Bank of China.
- Avid golfer plays almost every day; sank his 15th hole in one in September.
- Poor immigrant sold plastic flowers in Hong Kong in the 1950s.
- Eldest son, Victor, helps him run businesses; son Richard struck out on his own in early 1990s and is a billionaire in his own right.
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Mukesh Ambani
World's Billionaires 2009
 © AP Photo | 7. Mukesh Ambani Net Worth: $19.5 billion Source: Petrochemicals/India Age: 51 Marital Status: Married, three children |
- Merging his Reliance Petroleum with flagship Reliance Industries. As part of deal, will exercise right to buy back Chevron's 5% stake in Reliance Petroleum at $1.2 per share--the same price at which he sold it three years ago. Today the stock trades for $1.80 a share.
- Increased stake in Reliance Industries last October; paid $3.4 billion to convert 120 million preferential warrants into shares.
- Reliance Petroleum refinery on India's western coast began operating in December despite falling global demand and declining margins.
- Late father Dhirubhai founded Reliance and built it into a massive conglomerate. After he died, Mukesh and his brother, Anil, ran the family business together for a brief time. But siblings feuded over control; mother eventually brokered split of assets. Brothers may be looking to bury hatchet; played joint hosts at mother's recent 75th birthday bash.
- Has yet to move into his 27-story home that he's building at a reported cost of $1 billion.
- Ardent fan of Bollywood films.
- Wife, Nita, oversees school named after his father.
 © AP Photo | 8. Lakshmi Mittal Net Worth: $19.3 billion Source: Steel/India Age: 58 Marital Status: Married, two children |
- Indian immigrant heads world's largest steel company; ArcelorMittal was formed via hostile takeover three years ago.
- Stock in company makes up bulk of his fortune; shares at a four-year low, with steel prices down 75% since last summer.
- Company forced to pay heavy fines after a French antitrust investigation found 10 companies guilty of price-fixing in European steel markets.
- Arcelor posted $2.6 billion loss in most recent quarter; announced plans to slow acquisitions, cut capital expenditures, pay down debt.
- Started in family steel business in the 1970s, branched out on his own in 1994.
- Initially bought up steel mills on the cheap in Eastern Europe. Company bought 19.9% stake in Australia's Macarthur Coal last year.
- Also owns pieces of Mumbai's Indiabulls Group, London's RAB Capital; owns stake in, sits on board of Goldman Sachs.
- Holds substantial cash; owns 12-bedroom mansion in London's posh Kensington neighborhood.
 © Kpix | 9. Theo Albrecht Net Worth: $18.8 billion Source: Supermarkets/Germany Age: 87 Marital Status: Married, two children |
- Runs discount supermarket group Aldi Nord; firm holding up amid economic downturn. Sales expected to hit $31 billion in 2008.
- After World War II he and older brother Karl transformed their mother's corner grocery into Aldi.
- Brothers split ownership in 1961; Karl took the stores in southern Germany, plus the rights to the brand in the U.K., Australia and the U.S. Theo got the northern Germany stores and the rest of Europe.
- Unable to operate Aldi stores in U.S., Theo developed discount food store Trader Joe's; now has more than 320 U.S. stores.
- Also owns stake in Supervalu.
- Became a recluse after being kidnapped for 17 days in 1971; said to collect old typewriters, loves golf.
 © MIGUEL RIOPA/AFP/Getty Images | 10. Amancio Ortega Net Worth: $18.3 billion Source: Fashion/Spain Age: 73 Marital Status: Divorced, remarried; three children |
- Railway worker's son started as a gofer in a shirt store.
- With then wife Rosalia Mera, also now a billionaire, started making dressing gowns and lingerie in their living room.
- Business became one of world's most successful apparel manufacturers.
- Today Inditex has more than 4,000 stores in 71 countries. Sales: $12.3 billion. Ortega is chairman.
- Company exported its cheap chic Zara stores to four new markets last year: Ukraine, South Korea, Montenegro and Honduras.
- Stock up 1% in past 12 months, but fortune down because of weak euro.
- Also has personal investments in gas, tourism, banks and real estate.
- Owns properties in Madrid, Spain; Paris; London; and Lisbon, Portugal; plus a luxury hotel and apartment complex in Miami, a horse-jumping circuit and an interest in a soccer league.
- Shuns neckties and fanfare.
- Daughter Marta works for Inditex; recent speculation suggests she is being groomed to eventually replace her father.
 © AARON SKINNER/Bloomberg News /Landov | 11. Jim C. Walton Net Worth: $17.8 billion Source: Wal-Mart/U.S. Age: 61 Marital Status: Married, four children |
- Wal-Mart remains the exception to the rule in the crumbling retail sector, thanks to its global footprint and deeply discounted prices. Also helping: the exodus of competitors like Circuit City and Linens 'n Things.
- Shares down 25% since September.
- Fourth-quarter profit hurt by lawsuit settlements, poor currency exchange; still beat analyst expectations.
- Stake in solar-paneling outfit First Solar fared far worse; shares down 60% since August after surging 120% in previous 12 months.
- Sam Walton started as J.C. Penney clerk in 1940; opened Newport, Ark., five-and-dime store Benjamin Franklin five years later. Lost lease in 1950.
- With brother James started general store chain in Bentonville, Ark., in 1962.
- Today Wal-Mart is world's largest retailer: 7,200 stores, 2 million employees serve 200 million customers. Sales: $378 billion.
- Jim chairs Arvest Bank Group, Community Publishers.
Other income source;
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Lawrence Ellison
World's Billionaires 2009
4. Lawrence Ellison
Net Worth: $22.5 billion
Source: Oracle/U.S.
Age: 64
Marital Status: Thrice divorced, remarried; two children
- Database titan continues to engulf the competition; Oracle has racked up 49 acquisitions in the past four years.
- Bought BEA Systems for $8.5 billion last year. Company still sitting on $7 billion in cash. Revenues up 11% to $10.9 billion in the six months ended Nov. 30, 2007; profits also up 11% to $2.4 billion. Stock down 25% in past 12 months.
- Invested $125 million in Web software outfit Netsuite; took public in 2007, stock down 80% since. His shares are still worth $300 million.
- Chicago native studied physics at University of Chicago, didn't graduate.
- Started Oracle in 1977. Public in 1986, a day before Microsoft.
- Owns 453-foot Rising Sun; built a smaller leisure boat because the long yacht is hard to park.
- Squabbling in court with Swiss boating billionaire Ernesto Bertarelli over terms of next America's Cup. Recently unveiled hulking 90-foot trimaran he intends to use to win it.
 © AP Photo/Heribert Proepper | 5. Ingvar Kamprad Net Worth: $22 billion Source: Ikea/Sweden Age: 83 Marital Status: Divorced, remarried; four children |
- Peddled matches, fish, pens, Christmas cards and other items by bicycle as a teenager.
- Started selling furniture in 1947.
- Opened first Ikea store 50 years ago; store's name is a combination of initials of his first and last name, his family farm and the nearest village.
- Retired in 1986; company's "senior adviser" still reportedly works tirelessly on his brand.
- Discount retailer now sells 9,500 items in 36 countries; prints catalog in 27 languages. Revenues up 7% to $27.4 billion in fiscal-year 2008.
- Opened 10th store in China this February; planning to open first in Dominican Republic later this year.
- Three sons all work at the company.
- Thrifty entrepreneur flies economy class, frequents cheap restaurants and furnishes his home mostly with Ikea products.
 © Kpix | 6. Karl Albrecht Net Worth: $21.5 billion Source: Supermarkets/Germany Age: 89 Marital Status: Married, two children |
- Germany's richest person owns discount supermarket giant Aldi Sud.
- Retailer faring well amid economic downturn; analysts expect its 2008 sales to be up 9.4% to $33.7 billion. Sales in the U.S. up estimated 20% last year to $7 billion.
- Plans to open 75 U.S. stores in 2009, including first in New York City.
- With younger brother, Theo, transformed their mother's corner grocery store into Aldi after World War II.
- Brothers split ownership in 1961; Karl took the stores in southern Germany, plus the rights to the brand in the U.K., Australia and the U.S. Theo got northern Germany and the rest of Europe.
- Retired from daily operations.
- Fiercely private: little known about him other than that he apparently raises orchids and plays golf.
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Carlos Slim Helú
World's Billionaires 2009
3. Carlos Slim Helú
Net Worth: $35 billion
Source: Telecom/Mexico
Age: 69
Marital Status: Widowed, six children
# Economic downturn and plunging peso shaved $25 billion from the fortune of Latin America's richest man.
# Global recession testing his ability to live up to the principles he sets for his employees: "Maintain austerity in times of fat cows."
# Son of a Lebanese immigrant bought fixed-line operator Telefonos de Mexico (Telmex) in 1990; now controls 90% of Mexico's telephone landlines.
# Would be a billionaire based on his dividends alone.
# Biggest holding: $16 billion stake in America Movil, Latin America's largest mobile phone company, with 173 million customers. America Movil and Telmex reportedly planning to jointly invest $4 billion to bolster telecom infrastructure in Latin America.
# Buying up cheap media, energy and retail assets.
# Last year took stakes in New York Times Co., former billionaire Anthony O'Reilly's Independent News & Media and Bronco Drilling; also increased position in Saks.
# Baseball statistics aficionado, art collector.
source
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How Anyone Can Buy Commercial Real Estate. How Anyone Can Buy Commercial Real Estate (Apartments, Office Buildings, Hotels, Mobile Home Parks, RV Parks, Etc.) Regardless Of Credit, Cash, Income Or Assets And Without Seller Financing In 2009!
Warren Buffett
2. Warren Buffett
Net Worth: $37 billion
Source: Investments/U.S.
Age: 78
Marital Status: Widowed, remarried; three children
* Last year America's most beloved investor was the world's richest man. More from Forbes.com: • Billionaire Bachelors and Bachelorettes • Women Billionaires • Celebrity Billionaires gatesClick here for the full list of the World's Billionaires
* This year he has to settle for second place after losing $25 billion in 12 months. Shares of Berkshire Hathaway down 45% since last March
* Injected billions of dollars into Goldman Sachs, General Electric in exchange for preferred stock last fall; propped up insurance firm Swiss Re in February with $2.6 billion infusion. Admits he made some "dumb" investment mistakes in 2008.
* Upbeat about America's future: "Our economic system has worked extraordinarily well over time. It has unleashed human potential as no other system has, and it will continue to do so."
* Scoffs at Wall Street's over-reliance on "history-based" models: "If merely looking up past financial data would tell you what the future holds, the Forbes 400 would consist of librarians."
* Son of Nebraska politician delivered newspapers as a boy.
* Filed first tax return at age 13, claiming $35 deduction for bicycle
. * Studied under value investing guru Benjamin Graham at Columbia.
* Took over textile firm Berkshire Hathaway 1965. * Today holding company invested in insurance (GEICO, General Re), jewelry (Borsheim's), utilities (MidAmerican Energy), food (Dairy Queen, See's Candies). Also has noncontrolling stakes in Anheuser-Busch, Coca-Cola, Wells Fargo.
source
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William Gates lll
The Top 20 Richest People in the World
Forbes
It's been a tough year for the richest people in the world. Last year there were 1,125 billionaires. This year there are just 793 people rich enough to make our list
The world has become a wealth wasteland.
Like the rest of us, the richest people in the world have endured a financial disaster over the past year. Today there are 793 people on our list of the World's Billionaires, a 30% decline from a year ago.
Of the 1,125 billionaires who made last year's ranking, 373 fell off the list--355 from declining fortunes and 18 who died. There are 38 newcomers, plus three moguls who returned to the list after regaining their 10-figure fortunes. It is the first time since 2003 that the world has had a net loss in the number of billionaires.
The world's richest are also a lot poorer. Their collective net worth is $2.4 trillion, down $2 trillion from a year ago. Their average net worth fell 23% to $3 billion. The last time the average was that low was in 2003.
Bill Gates lost $18 billion but regained his title as the world's richest man. Warren Buffett, last year's No. 1, saw his fortune decline $25 billion as shares of Berkshire Hathaway (BRK) fell nearly 50% in 12 months, but he still managed to slip just one spot to No. 2. Mexican telecom titan Carlos Slim Helú also lost $25 billion and dropped one spot to No. 3.
It was hard to avoid the carnage, whether you were in stocks, commodities, real estate or technology. Even people running profitable businesses were hammered by frozen credit markets, weak consumer spending or declining currencies.
The biggest loser in the world this year, by dollars, was last year's biggest gainer. India's Anil Ambani lost $32 billion--76% of his fortune--as shares of his Reliance Communications, Reliance Power and Reliance Capital all collapsed.
Ambani is one of 24 Indian billionaires, all but one of whom are poorer than a year ago. Another 29 Indians lost their billionaire status entirely as India's stock market tumbled 44% in the past year and the Indian rupee depreciated 18% against the dollar. It is no longer the top spot in Asia for billionaires, ceding that title to China, which has 28.
Russia became the epicenter of the world's commodities bust, dropping 55 billionaires--two-thirds of its 2008 crop. Among them: Dmitry Pumpyansky, an industrialist from the resource-rich Ural mountain region, who lost $5 billion as shares of his pipe producer, TMK, sank 84%. Also gone is Vasily Anisimov, father of Moscow's Paris Hilton, Anna Anisimova, who lost $3.2 billion as the value of his Metalloinvest Holding, one of Russia's largest ore mining and processing firms, fell along with his real estate holdings.
Twelve months ago Moscow overtook New York as the billionaire capital of the world, with 74 tycoons to New York's 71. Today there are 27 in Moscow and 55 in New York.
After slipping in recent years, the U.S. is regaining its dominance as a repository of wealth. Americans account for 44% of the money and 45% of the list's slots, up seven and three percentage points from last year, respectively. Still, it has 110 fewer billionaires than a year ago.
Those with ties to Wall Street were particularly hard hit. Former head of AIG (AIG) Maurice (Hank) Greenberg saw his $1.9 billion fortune nearly wiped out after the insurance behemoth had to be bailed out by the U.S. government. Today Greenberg is worth less than $100 million. Former Citigroup (C) Chairman Sandy Weill also falls from the ranks.
Last year there were 39 American billionaire hedge fund managers; this year there are 28. Twelve American private equity tycoons dropped out of the billionaire ranks.
Blackstone Group's (BX) Stephen Schwarzman, who lost $4 billion, and Kohlberg Kravis & Roberts' Henry Kravis, who lost $2.5 billion, retain their billionaire status despite their weaker fortunes.
Worldwide, 80 of the 355 drop-offs from last year's list had fortunes derived from finance or investments.
While 656 billionaires lost money in the past year, 44 added to their fortunes. Those who made money did so by catering to budget-conscious consumers (discount retailer Uniqlo's Tadashi Yanai), predicting the crash (investor John Paulson) or cashing out in the nick of time (Cirque du Soleil's Guy Laliberte).
So is there anywhere one can still make a fortune these days? The 38 newcomers offer a few clues. Among the more notable new billionaires are Mexican Joaquín Guzmán Loera, one of the biggest suppliers of cocaine to the U.S.; Wang Chuanfu of China, whose BYD Co. began selling electric cars in December, and American John Paul Dejoria, who got the world clean with his Paul Mitchell shampoos and sloppy with his Patrón Tequila.
The Top 20 Richest People in the World
Net Worth: $40 billion
Source: Microsoft/U.S.
Age: 53
Marital Status: Married, three children
- Software visionary regains title as the world's richest man despite losing $18 billion in the past 12 months.
- Stepped down from day-to-day duties at Microsoft last summer to devote his talents and riches to the Bill & Melinda Gates Foundation.
- Organization's assets were $30 billion in January; annual letter lauds endowment manager Michael Larson for limiting last year's losses to 20%.
- Gates decided to increase donations in 2009 to $3.8 billion, up 15% from 2008.
- Dedicated to fighting hunger in developing countries, improving education in America's high schools and developing vaccines against malaria, tuberculosis and AIDS.
- Appointed Microsoft Office veteran Jeffrey Raikes chief executive of Gates Foundation in September. Gates remains Microsoft chairman.
- Sells shares each quarter, redeploys proceeds via investment vehicle Cascade; more than half of fortune invested outside Microsoft.
- Stock down 45% in past 12 months.
- "Creative capitalist" wants companies to match profit making with doing good.
source
other Income source:
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Tuesday, December 2, 2008
investment
Investmen is a term with several closely-related meanings in business management, finance and economics, related to saving or deferring consumption.
Investment is the choice by the individual to risk his savings with the hope of gain. Rather than store the good produced, or its money equivalent, the investor chooses to use that good either to create a durable consumer or producer good, or to lend the original saved good to another in exchange for either interest or a share of the profits.
In the first case, the individual creates durable consumer goods, hoping the services from the good will make his life better. In the second, the individual becomes an entrepreneur using the resource to produce goods and services for others in the hope of a profitable sale. The third case describes a lender, and the fourth describes an investor in a share of the business.
In each case, the consumer obtains a durable asset or investment, and accounts for that asset by recording an equivalent liability. As time passes, and both prices and interest rates change, the value of the asset and liability also change.
An asset is usually purchased, or equivalently a deposit is made in a bank, in hopes of getting a future return or interest from it. The word originates in the Latin "vestis", meaning garment, and refers to the act of putting things (money or other claims to resources) into others' pockets. See Invest. The basic meaning of the term being an asset held to have some recurring or capital gains. It is an asset that is expected to give returns without any work on the asset per se.
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Tuesday, October 14, 2008
Budget deficit in 2008 surges to all-time high
WASHINGTON - The federal budget deficit soared to $454.8 billion in 2008 as a housing collapse and efforts to combat the economic slowdown pushed the tide of government red ink to the highest level in history.
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The Bush administration said Tuesday the deficit for the budget year that ended Sept. 30 was more than double the $161.5 billion recorded in 2007.
It surpassed the previous record of $413 billion set in 2004. Economists predicted a far worse number next year as the costs of the government's rescue of the financial system and the economic hard times hit the nation's balance sheet.
Some analysts believe that next year's deficit could easily top $700 billion, giving the next president a formidable challenge.
The administration blamed this year's record deficit on a litany of economic woes. The prolonged housing slump sharply reduced economic growth and has sent the unemployment rate rising, developments that reduce tax revenues.
"This year's budget results reflect the ongoing housing correction and the manifestation of that in strained capital markets and slower growth," Treasury Secretary Henry Paulson said in a statement accompanying the deficit report. "While it will take time to work through this period, we will overcome the current challenges facing our nation."
Democrats said the administration's economic policies were responsible for the growing deficit. They noted that when Bush took office in 2001, the budget was in surplus with projections that total surpluses over the next decade would reach $5.6 trillion. Those surpluses never materialized. The economy fell into a recession and then faced unexpected costs such as fighting wars in Afghanistan and Iraq and dealing with the aftermaths of Hurricane Katrina. Democrats also cite the costs of Bush's 2001 and 2003 tax cuts as further reasons for the budget imbalances.
"The eight years of this administration will include the five biggest budget deficits in history," said House Budget Committee Chairman John Spratt, D-S.C. "The resulting debt will be passed to our children and grandchildren."
Senate Budget Committee Chairman Kent Conrad, D-N.D., said the national debt had climbed by more than $1 trillion while Bush was in office and "the next president will inheriting a fiscal and economic mess of historic proportions."
The credit crisis that has swamped the financial system is boosting outlays because of the costs of protecting the depositors of failed banks.
Those costs will increase significantly in coming years. The government faces the prospects of paying for the $700 billion rescue plan that will boost spending as the government spends $250 billion in coming months to buy stock from banks to bolster their balance sheets and also buys up bad assets currently on banks' books.
Both of those programs are aimed at relieving strains on banks so they can resume more normal lending and ease a credit crisis that is threatening to push the country into a severe recession.
Many private economists believe the country will not be able to escape a recession even if the rescue program is successful at getting banks to resume lending.
The Bush administration is projecting that the deficit in the current budget year will rise to $482 billion, but that estimate made in the summer does not include the costs of the rescue program passed by Congress on Oct. 3.
The deficit for 2008 reflected the costs incurred in recent months for a $168 billion economic stimulus program that Congress passed at the beginning of this year in an effort to combat the economic slowdown. Those checks did give the economy a boost in the late spring and early summer. That impact has now faded leading many analysts to project that the current quarter and the first three months of next year will show declines in overall input.
Stocks pull back as profit-taking sets in
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It was the first time in nine sessions that the Dow Jones industrial average didn't close with triple-digit losses or gains although it did swing in a 700-point range. The Dow closed down 76 points a day after its record 936-point jump.
Big advances by many bank stocks helped offset some of the declines in the Dow and the Standard & Poor's 500 index, giving them a better showing for the day than the Nasdaq composite index, which fell more than 3 percent. The technology-dominated Nasdaq also lagged ahead of a profit report from Intel Corp., as investors were reminded of the troubled economy and its impact on corporate earnings.
Profit-taking set in after the Dow surged more than 400 points at the opening. Wall Street is expected to see jittery trading in the weeks and perhaps months ahead because of worries about the economy; stocks also tend to ratchet up and down when they're recovering from a plunge like the one Wall Street has suffered in the past two weeks.
"We don't know if the bottom is in," said Lincoln Anderson, chief investment officer and chief economist at LPL Financial, referring to the market's advance Monday after huge losses last week. "We certainly expect heightened volatility for a fair amount of time while we sort out just exactly what's going on."
Investors had snapped up stocks Monday in anticipation of the government's plan. President Bush said Tuesday the government would use a portion of the $700 billion financial bailout passed at the start of the month to inject capital into the nation's major banks, which have been slammed by souring mortgage investments. The move follows a similar one announced Monday by European governments to invest about $2 trillion in their own troubled banks.
The revised bailout plan differs from the original in that it aims to recapitalize banks, not just buy the troubled assets off their books at prices that could leave the banks with losses.
"This begins to penetrate the core of the problem," said Peter Cardillo, chief market economist at New York-based brokerage house Avalon Partners Inc.
Robert Dye, senior economist at PNC Financial Services Group, said the government's actions likely will help revive the credit markets, but now that the plan is place, investors are shifting back to concerns about the economy.
"These steps are not going to turn the real economy on a dime," he said of the government intervention. "The two keys to the fundamental economy right now are the job market and the housing market and both of those remain distressed."
"There isn't one bottom here. We're talking about multiple events. There will be a bottom in financial market and another in the labor market and one in the housing market. And they're not going to all line up," Dye said.
The Dow fell 76.62, or 0.82 percent, to 9,310.99.
Broader stock indicators also declined. The S&P 500 index fell 5.34, or 0.53 percent, to 998.01, and the Nasdaq fell 65.24, or 3.54 percent, to 1,779.01.
The Russell 2000 index of smaller companies, including many tech concerns, fell 16.24, or 2.84 percent, to 554.65.
Though the major indexes showed losses, advancing issues outnumbered decliners by about 9 to 7 on the New York Stock Exchange, where consolidated volume came to 7.97 billion shares, compared with 7.1 billion shares traded Monday.
Ryan Detrick, senior technical strategist at Schaeffer's Investment Research, said investors pleased about the government's plan gravitated toward industrial companies, seeing them as more likely to benefit from a revived credit market than tech companies. That also helped send the Nasdaq lower.
"People are thinking more of the blue chips are going to respond," he said.
The Dow remains 34.3 percent below its Oct. 9, 2007 record close of 14,164.53, and could fluctuate around these levels as investors await signs of stabilization in the housing and job markets.
Cardillo said he believes the worst lows are behind the stock market, but other analysts have shied away from saying Wall Street had reached a bottom. The Dow has not yet fallen below its low during the last bear market, the closing level of 7,286.27 on Oct. 9, 2002.
Investors have been trying to regain their footing after a gruesome week that obliterated about $2.4 trillion in shareholder wealth. The Dow shot higher Monday after an eight-day losing streak that amassed point losses of just under 2,400, or 22.1 percent, bringing the blue-chip index to its lowest level since April 2003. That 18.2 percent weekly plunge in the Dow was the worst in the index's 112-year history.
Following the Columbus Day holiday, the U.S. government bond markets reopened Tuesday and indicated that investors' desire for safe assets remains strong. The three-month Treasury bill's yield, which moves opposite its price, rose to 0.30 percent from 0.21 percent late Friday, and the 10-year note's yield rose to 4.03 percent from 3.86 percent.
A drop in a key bank-to-bank lending rate indicates banks could be growing more willing to lend to one another. The London interbank offered rate, or Libor, for three-month dollar loans fell to 4.64 percent from 4.75 percent. Libor is important because many consumer loans, including about half of all adjustable-rate mortgages, are tied to it.
The recent sell-off in stocks came amid a seize-up in lending, as banks and investors around the world grew fearful about the creditworthiness of other institutions following the September bankruptcy of investment bank Lehman Brothers Holdings Inc. and the subsequent failure of thrift bank Washington Mutual Inc. Tight lending conditions make it harder and more expensive for businesses and consumers to get a loan, a headwind for economic growth.
Many of the nine banks the government identified as ones in which it will invest advanced Tuesday. Among them, Citigroup Inc. rose $2.87, or 18 percent, to $18.62, while Bank of America Corp. rose $3.74, or 16 percent, to $26.53. JP Morgan Chase & Co. fell $1.28, or 3.1 percent, to $40.71.
Intel fell $1.06, or 6.2 percent, to $15.93 ahead of its quarterly earnings report, which arrived after the closing bell. The chip maker's profit topped analysts' forecasts though the company warned the financial crisis is making it difficult to project results and that its fourth-quarter sales could fall short of Wall Street estimates.
Light, sweet crude fell $2.56 to settle at $78.63 per barrel on the New York Mercantile Exchange.
The dollar fell against most other major currencies, while gold prices declined.
Asian and European markets soared Tuesday. Hong Kong's Hang Seng index rose 3.19 percent, after a more than 10 percent increase on Monday. Japan's Nikkei index, catching up from the country's market holiday Monday, jumped 14.15 percent — the largest increase ever.
In Europe, Britain's FTSE 100 jumped 3.23 percent, Germany's DAX index rose 2.70 percent, and France's CAC-40 rose 2.75 percent. source
Bulls keep running
NEW YORK -- Stocks surged Tuesday morning, adding to the prior session's historic rally, as investors cheered the Bush administration's plan to recapitalize major banks.
The Dow Jones industrial average (INDU) jumped 363 points in the early going. The Standard & Poor's 500 (SPX) index added 3.9% and the Nasdaq composite (COMP) gained 2%.
Stocks surged Monday, with the Dow industrials soaring some 936 points, or 11%, marking the largest-ever point advance for the blue-chip index. The S&P 500 and Nasdaq also hit point-gain records.
Investors reacted to global efforts over the weekend and into Monday aimed at unfreezing credit markets and getting money flowing through the pipelines.
Treasury trading resumed following the Columbus Day holiday, and could give a good indication of whether all the recent interventions are working.
On Tuesday, the Bush administration announced plans to recapitalize U.S. banks in an effort to end the credit freeze that has slammed the global economy. Among the moves announced: a $250 billion investment in nine major banks and a plan for the the Federal Deposit Insurance Corp. will back up new senior bank debt for three years.
"These efforts are designed to directly benefit the American people by stabilizing our overall financial system and helping our economy recover," President Bush said in a statement outside the White House.
Overseas markets extended their celebration, with Japan's Nikkei surging to a single-day record gain of 14.2%.
European markets rallied for the second straight day. London's FTSE-100 was up 5.5% in afternoon trading, while Frankfurt's DAX and Paris' CAC-40 climbed by 5%.
Numbers: Soft drink maker PepsiCo (PEP, Fortune 500) reported weaker-than-expected third-quarter earnings and said it would cut 3,300 jobs due to the global economic slowdown. Pepsi shares fell 3.8% in premarket trading.
Dow component Johnson & Johnson (JNJ, Fortune 500) reported higher third-quarter earnings that beat expectations. J&J shares rose 5% in premarket trading.
Dollar and oil. The dollar remained under pressure early Tuesday. The greenback was down against the 15-nation euro and the British pound, but was up slightly against the Japanese yen.
Crude prices, meanwhile, stepped higher. Prices, which have plunged some 43% from the record $147.27 a barrel set on July 11, were up $2.01 to $83.21 a barrel early Tuesday.
Oil prices have been under pressure amid worries that the global crisis would undercut demand. Late last week, OPEC announced it would hold an emergency meeting Nov. 18 to address the issue. source
Monday, October 13, 2008
Banco Santander buying rest of Sovereign for $1.9B
NEW YORK - Banco Santander of Spain said Monday it would buy the other three-quarters stake in Sovereign Bancorp that it doesn't already own for $1.9 billion, extending a wave of consolidation as the banking industry struggles to deal with a load of soured debt related to mortgages.
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The Spanish bank already had a nearly 25 percent stake in Sovereign, a Philadelphia-based thrift, and will buy the rest with stock valued at about $3.81 for each share of Sovereign, a premium of 3.5 percent to Sovereign's closing price on Monday.
The deal, which had been rumored earlier in the day, was announced after trading closed Monday.Sovereign's shares fell 13 cents to $3.68 in the regular trading session but jumped 16 cents in after-hours trading following the announcement.
Like many U.S. banks, Sovereign Bancorp has been pummeled by rising mortgage delinquencies as the housing market tumbles. Its stock has lost nearly two-thirds of its value in the year to date.
The spreading credit crisis has already resulted in consolidation among national banks including Wachovia Corp., which is being bought by Wells Fargo & Co., and analysts say they've been expecting mid-size, regional banks to be next. Sovereign had said earlier Monday that it was in advanced discussions with Banco Santander.
The driving force behind the consolidation of regional banks is a lack of capital, said Doug Landy, a partner in the U.S. banking practice of law firm Allen & Overy. Large banks and very small banks have a much easier time raising capital than regional banks because big banks can tap into the international markets for cash, while small banks have a local connection.
Ralph Whitworth, a member of Sovereign's board of directors and chairman of its capital and finance committee, said in a statement that the company made the choice because of the "unprecedented uncertainty" in the marketplace.
Banks and other companies in the financial industries are losing money on bad mortgage bets and products that have repackaged these debts as homeowners struggle to keep up with their payments.
Later Monday, after the deal was announced, Sovereign showed just how much it was being affected by these bad bets as it pre-announced its third quarter earnings.
The company said it posted a loss of $982 million, or $1.48 a share in the period ending Sept. 30. That compares to net income of $58.2 million, or 11 cents a share, in the same period last year.
The loss includes a previously announced impairment charge on the bank's Fannie Mae and Freddie Mac perpetual preferred stock of $575 million. Those two companies, which bought mortgages and then resold them packaged as financial instruments, have been taken over by the government.source
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Friday, October 10, 2008
Prudential becomes latest insurer to warn
NEW YORK - Prudential Financial Inc (PRU.N) is the latest major insurer to warn its quarterly profits would miss forecasts, as the shares of rivals were pummeled on concern they would need to raise capital.
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The second-largest U.S. life insurer said on Thursday that third-quarter profit would be cut sharply by losses on poorly performing annuity and investment products and a charge for a legal settlement.
That followed recent profit warnings at U.S. life and property insurer Hartford Financial Services Group Inc (HIG.N) and MetLife Inc (MET.N), the largest life insurer in the United States.
The latter sold new shares at a discount on Wednesday to bolster its capital, raising $2 billion, while Hartford earlier this week received a $2.5 billion capital injection from Allianz SE (ALVG.DE), Europe's biggest insurer.
"Insurers made big investments in mortgage-related securities and are also big holders of stocks and bonds in financial firms that have been wiped out or badly damaged by the credit crisis, such as Lehman Brothers and Washington Mutual, said Alan Rambaldini, a life insurance analyst at investment research firm Morningstar.
"On top of that, bigger life insurers like Prudential get fees on the size of stock investments behind annuity products they sell to customers, which will drop sharply as the broader market plummets," he said.
'TRADING ON FEAR'
Among other life insurers, Lincoln National Corp (LNC.N), fell 35 percent to $18.31, Principal Financial Group Inc (PFG.N) lost 27 percent to $15.79 a share and Unum Group (UNM.N) fell 30 percent to $14.77.
Life insurance, as measured by the sectoral S&P Life & Health Insurance index (.GSPLIFE), was down 17 percent, making it the second-worst performing sector after automakers.
Even beyond life, XL Capital Inc (XL.N), a large Bermuda-based reinsurer, fell 54 percent to $4.01.
"The group (insurers) are trading on fear right now," said Bret Howlett, Standard & Poor's life insurance analyst. "A lot of investors are worried about capital positions in this unfavorable operating environment.
"People are worried about whether these companies are going to need to raise additional capital. In this environment, it's going to be difficult to raise that capital."
American International Group Inc (AIG.N) shares fell 25 percent to $2.39, one day after the company said it would get more liquidity from the government.
AIG, once the world's largest insurer, got an $85 billion loan from the government three weeks ago when it was on the brink of collapse. Under the new plan, the Federal Reserve Bank of New York will take up to $37.8 billion in investment-grade, fixed-income securities from AIG in exchange for cash.
"The government has effectively provided them support for $110 billion. I think they have exhausted that avenue and so I think as they move forward their options have diminished," said Keith Wirtz, president and chief investment officer of Fifth Third Asset Management.
UNDER PRESSURE
Citing market volatility and extraordinary events affecting financial markets, Prudential has suspended all purchases of its own stock.
It said it has liquidity to meet requirements at the parent company and at all operating subsidiaries and, unless it enters into any strategic deals, its need to access the capital markets before the end of the year would be modest.
"We are comfortable with our risk profile and believe that we are in a strong position to manage through the current environment," said Prudential Chief Executive John Strangfeld, in a statement.
Prudential did not say when it would report third-quarter earnings.
Insurers have been under pressure to keep solid capital positions to maintain their ratings after their investments lost value as financial markets sank in recent weeks.
Keeping high ratings is essential for insurers because lower ratings can mean higher costs and, in some cases, even a loss of business. source
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Tuesday, October 7, 2008
Insurance giant AIG's role in market crisis probed
WASHINGTON - Less than a week after the federal government had to bail out American International Group Inc., the company sent executives on a $440,000 retreat to a posh California resort, lawmakers investigating the company's meltdown said Tuesday.
The tab included $23,380 worth of spa treatments for AIG employees at the coastal St. Regis resort south of Los Angeles even as the company tapped into an $85 billion loan from the government it needed to stave off bankruptcy.
The retreat didn't include anyone from the financial products division that nearly drove AIG under, but lawmakers were still enraged over thousands of dollars spent on catered banquets, golf outings and visits to the resort's spa and salon for executives of AIG's main US life insurance subsidiary.
"Average Americans are suffering economically. They're losing their jobs, their homes and their health insurance," Democratic House Oversight Committee Chairman Henry Waxman scolded. "Yet less than one week after the taxpayers rescued AIG, company executives could be found wining and dining at one of the most exclusive resorts in the nation."
The hearing also revealed that AIG executives hid the full range of its risky financial products from auditors as losses mounted, according to documents released Tuesday by a congressional panel examining the chain of events that forced the government to bail out the conglomerate.
The panel sharply criticized AIG's former top executives, who cast blame on each other for the company's financial woes.
"You have cost my constituents and the taxpayers of this country $85 billion and run into the ground one of the most respected insurance companies in the history of our country," said Democratic Rep. Carolyn Maloney. "You were just gambling billions, possibly trillions of dollars."
AIG, crippled by huge losses linked to mortgage defaults, was forced last month to accept the $85 billion government loan that gives the US the right to an 80 percent stake in the company.
Waxman unveiled documents showing AIG executives hid the full extent of the firm's risky financial products from auditors, both outside and inside the firm, as losses mounted.
For instance, federal regulators at the Office of Thrift Supervision warned in March that "corporate oversight of AIG Financial Products ... lack critical elements of independence." At the same time, Pricewaterhouse Cooper confidentially warned the company that the "root cause" of its mounting problems was denying internal overseers in charge of limiting AIG's exposure access to what was going on in its highly leveraged financial products branch.
Waxman also released testimony from former AIG auditor Joseph St. Denis, who resigned after being blocked from giving his input on how the firm estimated its liabilities.
Three former AIG executives were summoned to appear before the hearing. One of them, Maurice "Hank" Greenberg — who ran AIG for 38 years until 2005 — canceled his appearance citing illness but submitted prepared testimony. In it, he blamed the company's financial woes on his successors, former CEOs Martin Sullivan and Robert Willumstad.
"When I left AIG, the company operated in 130 countries and employed approximately 92,000 people," Greenberg said. "Today, the company we built up over almost four decades has been virtually destroyed."
Sullivan and Willumstad, in turn, cast much of the blame on accounting rules that forced AIG to take tens of billions of dollars in losses stemming from exposure to toxic mortgage-related securities.
Lawmakers also upbraided Sullivan, who ran the firm from 2005 until June of this year, for urging AIG's board of directors to waive pay guidelines to win a $5 million bonus for 2007 — even as the company lost $5 billion in the 4th quarter of that year. Sullivan countered that he was mainly concerned with helping other senior executives.
Sullivan also came under fire for reassuring shareholders about the health of the company last December, just days after its auditor, Pricewaterhouse Cooper, warned of him that AIG was displaying "material weakness" in its huge exposure to potential losses from insuring mortgage-related securities.
AIG's problems did not come from its traditional insurance subsidiaries, which remain healthy, but instead from its financial services operations, primarily its insurance of mortgage-backed securities and other risky debt against default. Government officials feared a panic might occur if AIG couldn't make good on its promise to cover losses on the securities; investors feared the consequences would pose a threat to the US financial system, which led to the government bailout.
AIG suffered huge losses when its credit rating was cut, thanks largely to complex financial transactions known as "credit default swaps." AIG was a major seller of the swaps, which are a form of insurance, though they are not regulated that way.
The swap contracts promise payment to investors in mortgage bonds in the event of a default. AIG has been forced to raise billions of dollars in collateral to back up those guarantees.
Sullivan said many of the firm's problems stemmed from "mark to market" accounting rules mandating that its positions guaranteeing troubled mortgage securities be carried as tens of billions of dollars in losses on its balance sheet.
This in turn, said former AIG chief executive Willumstad, who ran the company for just three months after Sullivan left, forced the firm to raise billions of dollars in capital. The federal rescue came after AIG suffered disastrous liquidity problems after its credit rating was lowered, forcing the company to come up with even more capital.
"AIG was caught in a vicious cycle," Willumstad said in the testimony.
Greenberg said that AIG "wrote as many credit default swaps ... in the nine months following my departure as it had written in the entire previous seven years combined. Moreover, "unlike what had been true during my tenure, the majority of the credit default swaps that AIGFP wrote in the nine months after I retired were reportedly exposed to subprime mortgages."
But Sullivan said the complex swaps had underlying value, even as the market for them froze, sending their book value plummeting and forcing AIG to scramble for collateral.
"When the credit markets seized up, like many other financial institutions, we were forced to mark our swap positions at fire-sale prices as if we owned the underlying bonds, even though we believed that our swap positions had value if held to maturity," Sullivan said.
The hearing is the second in two days into financial excesses and regulatory mistakes that have spooked stock and credit markets and heightened fears about a global recession source
