Stock Preacher

Takeover rumors of DryShips by Denmark’s Maersk sparked a spike of buying and price in the Greece-based dry bulk shipper’s stock, DRYS.

Monday’s volume in DryShips stock exceeded 60 million shares, or a four-fold jump from its 30-day average.  Frenzied buying in the options market was also cited.

Traders expect more volatility in the stock, possibly downwardly, if the rumors turn out to have no basis of fact.  Since no official announcement has been made from either company, many investors believe the rumor is only that, a baseless rumor.

The rumor spread rapidly following reports of heavy call buying at the DRYS $7 strike. Read more

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In the ever continuing ripples created by the massive housing plunge faced by most of the U.S. in the past two years, the banks holding the largest amounts of “mortgages in the red” have been looking to short sales to remove these assets from their books in an effort to bolster their bottom lines. Citigroup, Wells Fargo and JPMorgan Chase among a myriad of others have begun to use the, until now, unpopular method of short sales where the homeowner and lender must agree on an offer proposed by a third party in order to sell the property in question, often for well below what is owed on it.

As home values continue to fall and many homeowners find themselves “upside-down” on their equity to debt ratios, short sales have skyrocketed, and are expected to continue on this path with home foreclosures predicted to climb 20% higher than the 3.4 million in 2009 to a record 4.3 million for 2010.  Read more

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tJohn Thain, whose impressive resume includes positions as former Goldman Sachs president, president of the New York Stock Exchange in 2003 where he spearheaded the transition to electronic trading, and former CEO of Merrill Lynch, who left slightly over a year ago after its stormy takeover by Bank of America, is poised to become chairman and CEO of CIT Group. A big lender to primarily small businesses in the U.S., CIT almost collapsed after declaring it would have to file for bankruptcy if it did not receive billions from investors last year after the company decided to expand its portfolio into student loans and subprime mortgages.

Thain, who has been coined as somewhat of a Mr. Fix-it of CEOs,  and who has never turned down a good challenge has taken over the reigns if CIT as of Monday morning February 8. It has been reported that he will be paid a $500,000 salary and receive restricted shares which valued at today’s share price would amount to approximately $5.5 million, $2.5 million of which are unavailable to Thain for a period of one year, with remainder of the shares will be withheld for a period of three years, this is in addition to performance bonuses, which if reached would be paid in additional shares valued at up to $1.5 million.

Prior to CIT’s interest in the embattled executive many companies whose corporate Read more

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President Barack Obama submitted a record $3.83 trillion federal budget on Monday, throwing unprecedented levels of funding in the fight against unemployment not waged in such intensity since FDR’s war on joblessness of the 30s.  The president’s budget also proposes higher tax levels on the “wealthy” and freezes discretionary spending on a wide range of programs.

This year’s budget includes another record deficit of $1.56 trillion, a gap that breaks last year’s then-unprecedented $1.41 trillion shortfall.  Next year’s deficit is expected to continue at a trillion-plus rate as well, even after a three-year budget freeze on an array of federal programs–excluding the military and homeland security–an increase in taxes on household earning north of $250,000, and taxes levied on the nation’s energy companies.

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Two distinct sides are forming among large investment banks over the Obama administration’s banking levy, with one side exploring the possibilities of legal action; at the same time, the other side is calling for the use of caution in the face of growing political backlash.

The Securities Industry and Financial Markets Association (SIFMA) confirmed rumors that it has hired Carter Phillips, a managing partner at the law firm Sidley Austin, who has argued 57 cases before the U.S Supreme Court, to study how best to respond to what it called a “very targeted and punitive tax.” Read more

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Many Americans can recall when they first realized the U.S was on the brink of economic disaster. They can also recall the pain of losing their jobs, taking big pay cuts, or finding themselves struggling to pay their mortgages and credit debts. These same Americans were also outraged and appalled after hearing that billions of dollars were handed out to the financial executives of the major banks, the very people who set the economic meltdown into motion!

JPMorgan Chase, Bank of America, and other big banks are again bracing for another political and public outcry against their massive compensation plans as they prepare to unveil their now infamous and widely despised multi-billion dollar bonus packages. Read more

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