Some interesting Friday links:
After Citi, is Bank of America next? (Reuters) A government rescue plan has eased investors’ concerns about Citigroup Inc, but mines lurking in the balance sheets of rivals including Bank of America Corp could still tempt short-sellers. Bank of America, the No. 3 U.S. bank by assets, has loaded up on mortgages as the world’s largest economy wrestles with the worst housing market since the Great Depression.
Citigroup bailout slammed by New Yorkers (Reuters): The bailout of Citigroup has made people in New York angrier than they were about any of the other government rescues of financial institutions this year.
Most Dividends Cut Since 1950s as Banks Conserve Cash (Bloomberg) Stock dividends are disappearing at the fastest rate in 50 years as the worsening recession forces U.S. companies to conserve cash. Citigroup Inc., Genworth Financial Inc. and New York Times Co. are leading 91 companies listed on the biggest U.S. exchanges in reducing or suspending payouts to shareholders this month, the most since May 1958, when 113 companies slashed dividends, according to data compiled by Standard & Poor’s. The reductions in November exceeded the 81 dividend cuts in October and 60 in September.
Bank lending rates could be controlled by Government (The Telegraph)
It’s almost 1984 in the UK. The Telegraph: Bank lending rates could be controlled by Government
Banks have been warned that Whitehall could take control of lending rates unless they begin supplying credit to small businesses again.
China slashes interest rates as panic spreads (The Telegraph) The People’s Bank of China cut interest rates by more than 1pc point as the economy crumbles and millions of jobs are predicted to go ahead of Christmas.
Merkel criticizes US over crisis (FT) Angela Merkel, the German chancellor, turned the tables on her international critics on Wednesday by accusing the US and other governments of making “cheap money” a central tool of their economic management, thus planting the seeds of a similar crisis in five years. “Excessively cheap money in the US was a driver of today’s crisis,” she told the German parliament. “I am deeply concerned about whether we are now reinforcing this trend through measures being adopted in the US and elsewhere and whether we could find ourselves in five years facing the exact same crisis.”