Market speaks: Health reform doesn’t matter and Fed probing Goldman trades with Greece
If you believe the stock market, health care reform is a dead subject.
While I’m sure the six hours of partisan debate will make for riveting television (sarcasm intended) there’s little need to pay close attention to President Obama’s Health Care Summit.
Wall Street has spoken. The market expects little in the way of meaningful change to the business of medicine.
I see very little chance of a substantial bill passing. Any investor inclined to buy health care stocks doesn’t have to worry about major legislation upsetting the apple cart any time soon," said Jack Ablin, chief investment officer with Harris Private Bank in Chicago.
Now I’m not going to get into whether that’s a good thing or a bad thing or what it means for the November mid-term elections. This column isn’t about politics.
But it seems clear that investors are making a bet on the status quo. [Read the full article]
We are looking into a number of questions related to Goldman Sachs and other companies and their derivatives arrangements with Greece," Bernanke said.
Bernanke’s response was to a question posed by Senate Banking chief Christopher Dodd, D-Conn., who asked about U.S. financial banks and hedge funds that are making financial bets that the Greek government will default on its loans.
Goldman Sachs (GS, Fortune 500) and other banks have been in the news over reports they secretly helped raise $1 billion in credit for Greece, in a way that was off the balance sheet and helped hide Greece’s big debt woes from European Union regulators.
The New York Times reported recently that some of these same banks were also now making side bets that Greece defaults on loans it owes U.S. banks and hedge funds. By betting in favor of default, the U.S. banks and hedge funds win whether Greece pays off its loans or not. [Read the full article]
Palm’s shares fell nearly 20% Thursday after the company’s CEO said 2010 sales would be "well below" its forecasts, citing worse-than-expected sales of its new smartphones.
Despite the hype surrounding Palm’s (PALM) new Pre smartphone, very positive reviews and a recent deal with No. 1 mobile carrier Verizon Wireless to sell the phone, Pre sales have been lackluster. In the third quarter of 2009, Palm shipped 783,000 Pres, compared to 8.7 million sales of Apple’s (AAPL, Fortune 500) iPhone in the same time period.
As a result, Palm said it expected its revenue this year to fall far below the $1.6 billion to $1.8 billion that the company had previously predicted.
Driving broad consumer adoption of Palm products is taking longer than we anticipated, said Palm Chief Executive Jon Rubinstein in a statement. [Read the full article]
Hoping to ease the small-business credit crunch, six regulatory agencies recently banded together in a joint statement essentially promising to back off second-guessing banks’ loans. "Prudent" small business lending will not be subject to supervisory criticism," a regulatory group led by the Federal Deposit Insurance Corp (FDIC) said earlier this month.
The move aims to reassure bankers who say they face blowback from government overseers when their loans go bad. Stiffer regulation has caused about half of community banks to pull back on their small business lending, according to a recent poll conducted in January by the Independent Community Bankers of America (ICBA).
As the regulators tighten up their standards, the bankers tighten up their standards," said Mark Schroeder, president of community lender German American Bancorp in Jasper, Ind.
There’s clear signs that’s happening. [Read the full article]