Archive for February 27th, 2009

FDIC to raise insurance rates to banks

Friday, February 27th, 2009

Story here

At a time when banks have no place to earn even meager interest safely, the FDIC has announced it needs an “emergency” increase in the insurance rate charged to insure your deposits.

The one time assessment with be 20 basis points ($.20 for each $100 on deposit), expected to generate $15 billion

The ongoing fee will be raised from $.14 to $.16 per $100 on deposit.

This was a completely predictable outcome of the Congressional mandate to increase the FDIC limit to $250k to cover deposits in banks for which no premiums were being paid in the past.  It’s like allowing people to buy house insurance the day after their house burned down.

Thank you John McCain.

It’s official – CitiGroup caves

Friday, February 27th, 2009

Story here

Citigroup Common stock immediately lost 41% of its value.

*** Update ***
Since the US Government is moving its claim of ownership to the end of the line, Citigroup Preferred stock is zooming up – up 70%….

NBA offered a “bailout”

Friday, February 27th, 2009

AFP (the French news service) reports that the Sports Business Journal  reports that Bank of America and JP Morgan approached the NBA about lending them $175 million to help them get through the tough times.

Does this mean the $500k governemnt salary cap needs to apply to the NBA?

Next bailout? Car Parts companies

Friday, February 27th, 2009

Story Here

According to an unnamed source[“Tim Geithner”], the US Treasury may set up an $18 billion fund to prop up unprofitable car parts manufacturers, so their failure doesn’t end up shutting down GM.