Good news for stocks is good for the $ and $642 million to clean up Lehman — and counting
The dollar has gotten stronger this year. Is that because the U.S. economy appears to be improving — or in spite of it? For most of last year, it was pretty easy to guess where the dollar was going. When stocks were up, the dollar was down. And vice versa.
That may seem odd, but here’s the rationale: The dollar was benefiting from a so-called flight to quality. Even though the U.S. economy was in bad shape, the dollar was still viewed as a relatively stable investment compared to stocks, commodities and other currencies.
So good economic and earnings news was considered bad for the greenback because any evidence that the recession was over made investors willing to flock back to riskier assets such as stocks and dump safe havens like the dollar.
That’s no longer the case. The dollar has gained nearly 3% this year against a basket of global currencies (including the euro, pound and yen) while the S&P 500 is also up 3%. [Read the full article]
A report released Thursday by the examiner in the Lehman Brothers Chapter 11 case exposed the games the defunct investment bank’s executives played to stay in Wall Street’s good graces.
The report showed auditors at Ernst & Young were less than vigilant in their vetting of Lehman’s financial reports, and that bankers including JPMorgan Chase (JPM, Fortune 500) hastened the firm’s demise by aggressively seizing collateral.
The report, by Anton Valukis of Chicago law firm Jenner & Block, was 15 months in the making and cost at least $38 million, going by the latest fee schedule Lehman’s estate filed with the Securities and Exchange Commission.
That’s just a drop in what is shaping up as a very large bucket for the fees of professional services firms in the case. Through January, Lehman’s bankruptcy estate had paid out $642 million to 28 law firms, advisers and consultants, according to a filing with the SEC last month. [Read the full article]
More than 170,000 troubled homeowners are breathing a lasting sigh of relief now that they’ve received permanent modifications under the Obama administration’s foreclosure prevention program.
Some 15.5% of those who entered the program have gotten long-term adjustments through February, up from 11.5% a month earlier, according to a report from Treasury officials issued Friday.
An additional 91,800 permanent modifications have been approved by servicers and are pending borrower acceptance. And more than 88,600 people have been denied lasting help because they did not meet the program’s criteria, while another 1,499 homeowners have had their permanent modification terminated.
More than 835,000 people are currently in trial modifications, a review period during which banks check whether borrowers can make the reduced payments and gather the necessary paperwork to verify income and hardship. [Read the full article]
China is bracing for another tough year despite economic growth, but opposes foreign pressure to appreciate the value of its currency, Premier Wen Jiabao said Sunday.
This is going to be the most complicated year for the economy, Wen said. We still face a lot of uncertainties.
Wen, who spoke at a news conference after a parliament meeting, said China will keep its currency, the yuan, basically stable," signaling that it’s not heeding calls to boost the value of its currency.
Last week, U.S. President Barack Obama asked China to allow the yuan to appreciate, amplifying complaints that Beijing artificially keeps the yuan undervalued to boost exports.
We oppose the practice of finger-pointing among countries or strong-arm measures to force other countries to appreciate currencies Wen said. [Read the full article]