How are your customers and vendors holding up in 2009?
I had two customers shutdown and close just last week. One was an 11 year account and the other was an 8 year account. The 11 year account fired and dismissed 859 employees. The 8 year account fired and dismissed 549 workers. Both were in Tennessee.
There will be more, fortunately the work that the 11 year account was doing is being divested and I have already been contacted by the fired employees who are now with new companies about resuming the same work for someone new.
About the same as you. One customer folded up last year. Another said the "B" word about ten days ago. Another good one isn't going racing again any time soon, so their R&D is dormant. Then there's the guys who don't say the "B" word, they just suddenly need us to play bank and put them on a payment schedule. Where's all this bailout money I keep hearing about?
-------------- 'RESCUED' CITI BUYING $50M JET JENNIFER GOULD KEIL and CHUCK BENNETT Last updated: 10:06 am January 26, 2009 Posted: 1:02 am January 26, 2009
Beleaguered Citigroup is upgrading its mile-high club with a brand-new $50 million corporate jet - only this time, it's the taxpayers who are getting screwed.
Even though the bank's stock is as cheap as a gallon of gas and it's burning through a $45 billion taxpayer-funded rescue, the airhead execs pushed through the purchase of a new Dassault Falcon 7X, according to a source familiar with the deal.
The French-made luxury jet seats up to 12 in a plush interior with leather seats, sofas and a customizable entertainment center, according to Dassault's sales literature. It can cruise
5,950 miles before refueling and has a top speed of 559 mph.
There are just nine of these top-of-the-line models in the United States, with Dassault's European factory churning out three to four 7Xs a month
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-------------- Thain Said to Pay $1.2 Million to Redecorate Office (Update1)
By Peter S. Green
Jan. 22 (Bloomberg) -- John Thain, the former Merrill Lynch & Co. chief executive officer ousted today, spent $1.2 million redecorating his downtown Manhattan office last year as the company was firing employees, a person familiar with the project said.
Thain hired Los Angeles-based decorator Michael Smith, chosen by President Barack Obama and his wife Michelle to redecorate the White House, CNBC reported today. Thain paid Smith $837,000 and his purchases included $87,000 for area rugs, $25,000 for a pedestal table and $68,000 for a 19th century credenza, CNBC said.
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If you think your stomach can stand it, there's lots more on the web.
Unka' George [George McDuffee]
------------------------------------------- He that will not apply new remedies, must expect new evils: for Time is the greatest innovator: and if Time, of course, alter things to the worse, and wisdom and counsel shall not alter them to the better, what shall be the end?
Francis Bacon (1561-1626), English philosopher, essayist, statesman. Essays, "Of Innovations" (1597-1625).
Nobody's gone under yet, but then I'm rather amazed a couple of them made it this far... Vendors seem to be doing OK too, though happier that usual for anything I send their way. This is California, northeast of Sacramento.
Lending Drops at Big U.S. Banks Top Beneficiaries of Federal Cash Saw Outstanding Loans Decline
1.4% Last Quarter
By DAVID ENRICH
Lending at many of the nation's largest banks fell in recent months, even after they received $148 billion in taxpayer capital that was intended to help the economy by making loans more readily available.
Ten of the 13 big beneficiaries of the Treasury Department's Troubled Asset Relief Program, or TARP, saw their outstanding loan balances decline by a total of about $46 billion, or 1.4%, between the third and fourth quarters of 2008, according to a Wall Street Journal analysis of banks that recently announced their quarterly results.
Those 13 banks have collected the lion's share of the roughly $200 billion the government has doled out since TARP was launched last October to stabilize financial institutions. Banks reporting declines in outstanding loans range from giants Bank of America Corp. and Citigroup Inc., each of which got $45 billion from the government; to smaller, regional institutions. Just three of the banks reported growth in their loan portfolios: U.S. Bancorp, SunTrust Banks Inc. and BB&T Corp.
The loan figures analyzed by the Journal exclude some big TARP recipients that haven't reported fourth-quarter results yet, such as Wells Fargo & Co.
The overall decline in loans on the 13 banks' books -- from about $3.36 trillion as of Sept. 30 to $3.31 trillion at year's end -- raises fresh questions about TARP's effectiveness at coaxing banks to reopen their lending spigots.
"It has failed," said Campbell Harvey, a finance professor at Duke University's business school. "Basically we have dropped a huge amount of money ... and we have nothing to show for what we actually wanted to happen."
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Unka' George [George McDuffee]
------------------------------------------- He that will not apply new remedies, must expect new evils: for Time is the greatest innovator: and if Time, of course, alter things to the worse, and wisdom and counsel shall not alter them to the better, what shall be the end?
Francis Bacon (1561-1626), English philosopher, essayist, statesman. Essays, "Of Innovations" (1597-1625).
Except they didn't George. What dropped was the market for securities. Bank lending is actually up. What is down is the selling of loans and origination fees. A 14% decline in bank lending is actually an increase. Banks haven't been lenders for ten years.
============ Sounds like "yes! we have no bananas...."
International countertrade [barter] that bypasses the banks seems to be taking off.
Any idea how much the typical countertrade transaction, say
100M$US might save by cutting the banks out?
--------------- Nations turn to barter deals to secure food
By Javier Blas in London
Published: January 26 2009 23:32 | Last updated: January 26 2009
23:32
Countries struggling to secure credit have resorted to barter and secretive government-to-government deals to buy food, with some contracts worth hundreds of millions of dollars.
In a striking example of how the global financial crisis and high food prices have strained the finances of poor and middle-income nations, countries including Russia, Malaysia, Vietnam and Morocco say they have signed or are discussing inter-government and barter deals to import commodities from rice to vegetable oil.
The countries have not disclosed the value of any deals, and some have refused even to confirm their existence. Officials estimated that they ranged from $5m for smaller contracts to more than $500m for the biggest.
Josette Sheeran, head of the United Nations? World Food Programme, said senior government officials, including heads of state, had told the WFP they were facing ?difficulties? obtaining credit to purchase food. ?This could be a big problem,? she told the Financial Times. {and we think we have problems because we can't get a loan for a new car...}
Last week, Malaysia?s commodities minister, Datuk Peter Chin Fah Kui, said Kuala Lumpur had already signed a barter deal swapping palm oil for fertilizer and machinery with North Korea, Cuba and Russia. He said Malaysia was talking to Morocco, Jordan, Syria and Iran about other barter deals.
Thailand, the world?s largest exporter of rice, is discussing barter deals with Middle Eastern countries, including Iran. The Philippines, the world?s largest importer of rice, has secured rice needs for this year through a diplomatic agreement with Hanoi.
The countries? struggle to obtain credit to import food is boosting the price of domestic crops. Ms Sheeran said that prices of crops in some African countries were rising sharply even as international food commodities prices had fallen from last summer.
The move to barter shows the global food crisis that started last year is far from over.
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Any of our posters in the managerial end of the business doing or thinking of doing any countertrade/barter deals?
Unka' George [George McDuffee]
------------------------------------------- He that will not apply new remedies, must expect new evils: for Time is the greatest innovator: and if Time, of course, alter things to the worse, and wisdom and counsel shall not alter them to the better, what shall be the end?
Francis Bacon (1561-1626), English philosopher, essayist, statesman. Essays, "Of Innovations" (1597-1625).
Nothing. It's actually rather messy and recriminations aren't uncommon. The only reason for a government to do this is the desire to avoid civil unrest - something that's manifesting with increasing frequency. Latvia, Lithuania, Spain, Greece, China..... The list is growing and so is the level of violence. I'll bet Blackwater's client list has shifted remarkably. They might be almost exclusively be providing security for people in the financial sector at this point. Branch managers will soon rate an armored caddy and a two man detail - maybe.
Remember my year old admonition about a modern day Father Coughlin?
--------------- A historical snippet from a much longer article in the UK Telegraph. Well worth reading if you have an interest in the US/global economy. Much better/more in depth coverage of the US situation from outside [the US] publications such as this, the Financial Times and the Economist.
TARP is the bastard offspring of the RFC.
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==>A third* of the rescue funds in Hoover's Reconstruction Finance Corporation had been embezzled.
------------ Thanks -- looks a lot more reputable than "billybobsblog.com"
FWIW -- Hoover was president until March 4, 1933, so the RFC was his program up to that time. FDR did however expand and redirect the RFC.
The degree to which outright fraud, embezzlement and theft both caused and exacerbated the '29 market break [and by extension the
2008 financial/credit implosion] appears to be greatly underestimated/underappreciated. Stupidity as a rationale and excuse will only stretch so far.
Unka' George [George McDuffee]
------------------------------------------- He that will not apply new remedies, must expect new evils: for Time is the greatest innovator: and if Time, of course, alter things to the worse, and wisdom and counsel shall not alter them to the better, what shall be the end?
Francis Bacon (1561-1626), English philosopher, essayist, statesman. Essays, "Of Innovations" (1597-1625).
Place I work has dropped down to 32 hours. I'm not worried, I have faith in them, the trade and my skills. However...This is the first time in 23 years I've worked anywhere under 40. The good news is...had this happened 10-15 years ago I would of went bankrupt, but these days I live quite lean. Seems like we at least had warning, and lots of people now can handle a slowdown. Not everyone I know, but things are slowing down in a good way because WE ALL are slowing down together.
My advice for the world is SLOW DOWN!!! Universal double time for hours over 32. Now that would fix global warming and every other problem that plagues humans.
================= For all of you folks that opened their windows, leaned out and shouted "I'm mad as hell and won't take it anymore."
------------------------------------------- Citigroup will not take possession of new aircraft
By STEPHEN BERNARD ? 54 minutes ago
NEW YORK (AP) ? Pressured by the Obama administration, Citigroup Inc. reversed course and said it will not take delivery of a corporate jet it previously planned to purchase.
The canceled deal comes amid a chorus of concerns from politicians who are worried about how banks that have received federal funds are spending the money. Citigroup has received $45 billion in capital from the government in recent months amid the ongoing credit crisis.
"Citi has no intent to take delivery of any new aircraft," the New York-based bank said in a statement Tuesday.
An official in President Barack Obama's administration reached out to Citigroup on Monday to reiterate Obama's position that such jets aren't "the best use of money at this point," and are "an outrageous use of funds" for a company getting taxpayer dollars, said a White House official who spoke on condition of anonymity to more freely describe private conversations.
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Unka' George [George McDuffee]
------------------------------------------- He that will not apply new remedies, must expect new evils: for Time is the greatest innovator: and if Time, of course, alter things to the worse, and wisdom and counsel shall not alter them to the better, what shall be the end?
Francis Bacon (1561-1626), English philosopher, essayist, statesman. Essays, "Of Innovations" (1597-1625).
I skipped the meeting, but the Memos showed that F. George McDuffee wrote on Tue, 27 Jan 2009 13:36:37
-0600 in alt.machines.cnc :
Stupidity got us into this mess, why can't it get us out. I think Will Rogers said that in the 30s.
There is a rule of thumb that says when everybody is talking about the market, get out and buy real estate. When everybody is talking about real estate, get into stocks. When your waitress is a getting a realtor's license, it's time to get out. I can never remember who it was who said in late 1928, early 1929, that he knew it was time to get out of the market, when his bootblack started offering stock market advice. As it was then, so it is now, and no doubt will be in the future: "The market is only going to go up, better buy now, 'this time it will be different'." Yeah, right, and I have some REITs for sale, bundled by the Brooklyn Bridge Investment company. Trust me.
pyotr
-- pyotr filipivich We will drink no whiskey before its nine. It's eight fifty eight. Close enough!
Speaking of closures, what guarantees are in place to see that those receiving funds from the "stimulus" packages are being spent on domestic services and products? Thereby supporting and shoring up OUR economy and not someone else's.
Same for banks and business. What guarantees are in place so we are helping domestic banks, businesses, financial firms that are owned and operated in the USA?
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