Global Markets Continue Downtrend on Greece Woes

Sep 20, 2011, 9:00 am EDT

Stocks in Asia, Europe and North America are falling as contagion from the Greek debt crisis continues to impact markets worldwide. Until there is some resolution, investors should expect this to continue along with intermittent sharp moves up thanks to central bank liquidity injections.

Trouble began in Asia last night with the Hang Seng in Hong Kong falling 537 points, or 2.8%. It closed at 18,918, well below the critical 20,000 support level. The Indian Sensex was down 188 points, or 1.1%, to 16,745. It has been leading Asian markets down and is trading on top of a very large gap made in May 2009. The Nikkei in Japan managed to buck the trend and close up 195 points to 8,864 or 2.3%. It has been mostly trading below key support at 10,000 since March when the Tohoku earthquake struck. All three markets are in a technically bearish trading pattern.

No part of the globe can escape what is happening in Europe. EU finance ministers said Friday they would delay authorizing a new installment of emergency funds for Greece until October. Greece still is on its first 110 billion euro bailout, but the final payments have yet to be made. A second bailout has yet to be fully approved, although the terms have been set. Greece’s fiscal situation continues to deteriorate rapidly despite all the funding it has received from the EU and the IMF. The bailout money is life support for Greece. If the plug is pulled, the patient defaults. Read 

5 Businesses That Will Suffer From a Post Office Overhaul

Sep 20, 2011, 5:00 am EDT

The United States Postal Service is in dire straits. It is projecting a $6.4 billion loss and could run out of money by the end of the month without a Congressional bailout to meet pension requirements.

The driving forces behind the agency’s financial woes are many — a precipitous drop in mail volume because of the digital age, skyrocketing labor costs and an inefficient network populated with infrequently used rural post offices and routes that just don’t make sense financially.

As a result, Postmaster General Patrick Donahoe asked Congress this month to untie his hands so he can make the kind of sweeping changes the organization needs to adjust. On the table are cuts to routes, office closures and even the elimination of Saturday delivery altogether. Read 

GOP Hatred of Taxes Could Result in More Layoffs

Sep 19, 2011, 8:02 am EDT
GOP Hatred of Taxes Could Result in More Layoffs

House Speaker John Boehner gave a speech to the Economic Club of Washington last week that made waves. Strangely enough, the hubbub was because he said the GOP will oppose any tax increases.

Shocker.

The summer of discontent has produced no change in Republican talking points: we won’t raise taxes and Obama is responsible for everything that sounds scary, expensive or is a product of the federal bureaucracy. Read 

In an Elitist Congress, Top Lawmakers Are Worth $1.6 Billion

Sep 17, 2011, 5:26 am EDT

As Congress takes up the American Jobs Act in the coming months it will be deciding, among other things, whether or not to extend payroll tax breaks, prevent teachers from being fired, continue to assist the unemployed and spur hiring of the long- term unemployed.

This particular package of legislation sits in the midst of Congress’ usual array of concerns that effect the average American: raising (or not) the minimum wage, making health care more affordable, preventing foreclosures and ensuring that seniors receive their fixed incomes every month.

Given the import of these tasks, it’s useful to note how different the financial priorities and experience of Congress are from our own. Or put more bluntly, how out of touch these rich folks are with the vast majority of Americans. Read 

3 Years After Lehman, We’ve Learned Nothing

Sep 14, 2011, 8:31 pm EDT

On Sept. 15, 2008, the world learned a debt-riddled Lehman Brothers would be no more. The Dow dropped more than 500 points that day, and a month later the index was off about 25%.

And that was only the beginning.

The corporate carnage that followed doesn’t deserve rehashing, since nearly every investor has a personal point of outrage. There was a death sentence for dividends, including a 68% cut in General Electric (NYSE:GE). There was the race to the bottom in the entire financial sector, with American International Group (NYSE:AIG) plunging 90% in seven trading days that fall. The list goes on. Read 

Greece: The Questions Investors Should Be Asking

Sep 14, 2011, 11:17 am EDT

Will Greece default, or won’t she? This seems to be the question on every investor’s lips, and the uncertainty surrounding the outcome has the markets on edge.

I have no inside information about how this crisis will be resolved, and even if I had the phones of every European leader bugged, I’m not sure the information gleaned would be particularly useful right now. The EU leaders tasked with resolving this crisis seem to have no more of a grasp on the situation than those of us on the outside.

No one said investing is easy or that it should be easy. Investing is an exercise in making difficult decisions under conditions of uncertainty. If we knew the future ahead of time, there would be no risk and thus no possibility for return — or loss. Read 

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