theFutonPoncho » Economy News

Visa IPO Price Set

Paddy Wallbouncer — Tue, 18 Mar 2008 23:50:44 +0000

About $44 per share, and 17.9 billion dollars in market capital. It’s just the natural course of things. Create a company that is based upon building up debt. Get the debt up to record levels! Just as it looks as though major defaults may be around the corner, spin the company off in an IPO! That way, when all the Visa credit card users are up to their hats in debt and start a massive round of defaults, have the investors of the shiny new Visa IPO pick up the tab. And did you read that the Investment houses like J.P. Morgan and Goldman Sachs made sure they had their best clients buy up the stock to thwart a rapid sell off ala Blackstone? It seems more like they were dumping it off to the ones more likely to be able to afford living with a dog with fleas. Who says they don’t have a heart?

And it was a big day on Wall Street. The Dow was up, the NASDAQ closed up over 4% It’s been a few years since they had that kind of gain, of course don’t forget that it is only back to the place it was three trading days ago -and it was significantly higher in December.

None of todays gains could possibly have any bearing on the fact that the Fed lowered interest rates, Again. Does anyone think of Forest Gump here?

“Then I had to lower interest rates… again.”

It would be good if those people who are up to eyeballs in debt could get a piece of that 4% pie, they’ll be paying on average around six times that amount. Where is a good Mafia loan shark when you need him. Oh, yea, forgot, he just spun off his legitimate IPO. Visa: It’s everywhere you want to be, threatening to break your legs if you don’t fess up.

Croak. Croak.

We’ll keep you informed of this and other entertaining news.

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Exxon Mobil Profits

Paddy Wallbouncer — Sat, 02 Feb 2008 04:07:38 +0000

40.6 billion is the highest annual profit for any American Company …ever. In a recent CNN story, Exxon Mobil said “for every $1 we earn, we pay $2.50 in taxes.” Hey, We’ve got the Futon Poncho, how can we get in on that deal? We’d would be happy to take out a loan to pay 100 million in taxes. Any takers? We’ll keep you informed of this and other entertaining news.

Emergency Rate Cut

Paddy Wallbouncer — Tue, 22 Jan 2008 14:18:13 +0000

The Federal Reserve cut U.S. interest rates by three quarters of a percent. That is the federal funds rate or the interest rate that banks charge each other on overnight loans. The new rate is 3.5% down from 4.25%. This is the first emergency rate cut by the Fed since September 11, 2001.

International markets over the last two days experienced huge sell offs driven by fear of a financial crisis in the United States. The Federal Reserve explained that short term funding has let up but as they said :

“broader financial market conditions have continued to deteriorate and credit has tightened further for some businesses and households. Moreover, incoming information indicates a deepening of the housing contraction as well as some softening in labor markets.”

This action was taken a week before the Fed’s regular meeting. The Fed believes this move will be a confidence builder, and hopes that it will be perceived that the powers in the United States Economy will do what it takes to get the economy under control. But what if the opposite is the result? What if the financial markets perceive that the Fed’s fear has driven the move? Will it increase the velocity of the downfall?