Buy Back Plan Hits A Roadblock

Buy Back Plan Hits A Roadblock
http://www.cnbc.com/id/30164508

While President Obama’s $1 trillion toxic asset buy back program brought much cheer to the markets when announced, the actual implementation is proving far from easy. The biggest hurdle is the evaluation of the toxic assets which the banks need to sell. However, while the government is subsidizing the cost and risk to encourage private investment, there is still a wide gap in what the market is willing to pay for those assets.
At the end of the day, unless the banks are able to liquidate those assets at a reasonable return, they may not be able to resurrect their fortunes. So even investors will probably need to compromise in the prices they set for those mortgages and the profits they expect to make.

Two Federal Banks Bank On Obama’s Policy

Two Federal Banks Bank On Obama’s Policy

http://www.bloomberg.com/apps/news?pid=20601103&sid=arvVOSK.u0Ro&refer=us

The Obama government financial policies have got thumbs up from important institutions in the nation.
Two Federal Reserve Bank Presidents expressed their confidence in the new US financial policies. They also said that they believe that the US economy will soar up from the current economic depression by the end of the year.
Their statement was in direct response to the $787 billion monetary parcel.
Gary Stern, Fed President of Minneapolis said that “Resumption of growth should not be too far off.”
On the other hand; Richmond Fed President, Jeffrey Lacker said that he could witness many favorable signs in the economy.
Whereas RBS Greenwich Capital Market’s Chief Economist, Stephen Stanley claimed -“the worst quarter is behind us.”

Emergency Loans For European Banks

Emergency Loans For European Banks

http://www.businessweek.com/bwdaily/dnflash/content/feb2009/db20090227_775099.htm


In a bid to curb the spread of the ongoing financial turmoil in Europe, international development banks are trying to shore up the European banking system by providing huge loans.

The World Bank Group, London-based European Bank for Reconstruction and Development and Luxembourg-based European Investment Bank have announced an emergency lending of about $30 billion besides proposing trade credits worth $25 billion to unlock the frozen lending in the Eastern European region.

Several Western European banks have high exposure to the Eastern Europe and are facing the heat of the growing credit crisis in the emerging markets. The loans by international development institutions are expected to mitigate the negative effects of financial crisis on the credit flow in the region. The package aims to assist individual financial institutions and sectors, while IMF will continue to provide its support at the macro economic level.

Another US Bank Shut Down, Total Closures Reach 14

Another US Bank Shut Down, Total Closures Reach 14

http://uk.reuters.com/article/economyNews/idUKTRE51K0VJ20090221

A struggling economy and falling home prices have forced the closure of another US bank, the 14th so far in the current year. Silver Falls Bank of Silverton, Oregon having assets worth $131.4 million and deposits worth $116.3 million was shut down with effect from February 9. The failure is expected to cost the FDIC deposit insurance fund an estimated $50 million. The deposits of the failed bank have been taken over by the Citizens Bank of Corvallis. The number of US banks seized by officials has increased sharply from 3 in 2007 to 25 in 2008. Soured mortgages and liquidity problems are the main issues leading to the failure of several US banks with the biggest bank closure being that of Washington Mutual.

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What The World Has To Say For U.S. Economic Measures

What The World Has To Say For U.S. Economic Measures

http://www.nytimes.com/2009/02/02/business/worldbusiness/02global.html?ref=business

American policies have taken enough beating from world leaders during the Bush years. Now Obama has taken over and made a promise to herald a change. He wants to encourage international cooperation on economy.

The world leaders sure do like the young man and his zest and coolness, but the hard times that they have faced at the hands of Bush have left them wary.
The world today is a classic example of – ‘Once bitten, twice shy’.

Signs of division in opinion between United States and other world leaders of China, Russia, Germany and France have been felt. Which way will the boat turn now?