BP oil spill clean-up costs spiral to $33 million a day

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BP oil spill clean-up costs spiral to $33 million a day
Saturday, May 22, 2010

••• BP is facing increasing financial pressure as clean-up costs following the Gulf of Mexico oil spill spiral to $33 million a day.

Amid rising anger over a huge oil slick hitting U.S. shores, BP officials on Friday denied botching the month-long clean-up and deliberately hiding the true extent of the spill.

As Grand Isle, Louisiana, closed its seven-mile beach to clean up an orange-liquidy slick washing ashore, the British energy giant once again postponed an operation aimed at permanently stopping the leak.

The ‘top-kill’ operation to inject heavy drilling fluids into the ruptured well, a month after the sinking of the Deepwater Horizon rig, and then seal it permanently with cement, will now not take place until Tuesday at the earliest instead of at the weekend.

Just how much oil is gushing daily from the rig’s wreckage has been a contentious issue, with BP initially putting the figure at 5000 barrels.

‘That was not just BP’s estimate. That was the estimate of the in-flight command, including NOAA and the Coast Guard. That’s the best estimate we have,’ BP’s chief operating officer Doug Suttles told ABC television Friday.

But in further confusing comments, BP also radically slashed by more than half its figures for how much of the oil it is siphoning up daily from the ruptured well via a 1 mile insertion tube.
BP spokesman John Curry said it now estimated some 92,400 gallons of oil had been diverted from the well in the 24 hours before midnight on Thursday.

That would mean BP is sucking up only 2,200 barrels daily from the pipe, not the 5,000 barrels it had estimated on Thursday.

Coast Guard commandant Thad Allen later told reporters that the flow was variable, fluctuating from a low rate of 2000 barrels a day to a high of 5,000 barrels.

Live webcam pictures showed more oil continuing to spew into the Gulf from the ruptured well — as visitors flocked to BP’s site to watch the video.

Even at the lowest estimates, more than six million gallons of crude have flowed into the water since the disaster.

And independent experts have warned the flow could be at least 10 times higher than the current estimates.

Suttles sought to quell the growing anger among the US administration, telling ABC television that BP had already spent $700 million on the clean-up.

‘We’ve mounted the largest response ever done in the world. We put 20,000 people at this.
‘I understand the anger. But I can tell you, I don’t know of anything, absolutely anything we could be doing that we’re not doing,’ he said.

But he also revised the timetable for when BP would attempt its latest bid to stop the leak, the ‘top kill’ operation.

‘Our current forecast for when this operation will take place is sometime in the early part of next week. The best estimate is Tuesday,’ Suttles told reporters.

He added the operation was very complex and was being carried out by robotic submarines positioning the equipment on the seabed a mile down.

Meanwhile, the White House also insisted it was doing everything it could.

‘We are facing a disaster the magnitude of which we likely have never seen before… We are doing everything humanly possible and technologically possible to deal with that,’ said White House spokesman Robert Gibbs.

He said, however, that the government was ill equipped to deal with the disaster.

‘The technical expertise to clean up and deal with the equipment that is 5,000 feet below the surface of the sea, that’s equipment that BP has… that other oil companies have. That is not not based on equipment that the federal government has in storage.’
» Related: Weekly Address: BP Spill Independent Commission
» Related: Obama forms commission to probe oil spill

British Airways posts another record annual loss

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British Airways posts another record annual loss
Friday, May 21, 2010

••• British Airways has posted a record annual net loss of $754 million, due to the recession, a tough winter and strikes by cabin crews in March.

Friday’s earnings update from the carrier – which is currently facing 15 more days of walkouts in a bitter dispute with cabin crews over changes to pay and working conditions – is slightly better than had been feared.

The loss for the year ending March 31 compares with a loss of $517.883 million in the previous year. Revenue dropped 11 percent to $11.558 billion.

British Airways (BA) says it is making progress on a cost savings program that has included cutting jobs. It has warned the Unite union that the disputed changes are necessary for the airline to survive in a post-financial crisis world.

The airline said revenues had plunged by $1.447 billion, although this was offset by falling fuel costs as well as savings elsewhere in the business.

Chief executive Willie Walsh also fired a broadside at unions after Unite on Thursday won its appeal against the latest strikes being ruled out on a technicality.

‘Returning the business to profitability requires permanent change across the company and it’s disappointing that our cabin crew union fails to recognise that,’ he warned.

He added that the current financial year ‘could hardly have had a worse start’ due to the disruption caused by Iceland’s volcanic eruption, which closed most of European airspace for almost a week in April.

Following the court decision, 15 days of strikes are due to kick off on Monday.

But the group said market conditions were showing improvement and BA is expecting to break even this year following its heavy losses.
• Source(s): British Airways PLC and Sky News / British Sky Broadcasting Ltd. (BSkyB) / News Corp.

Toyota logs $1.60 billion 2009 profit despite recall woes

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Toyota logs $1.60 billion 2009 profit despite recall woes
Tuesday, May 11, 2010

••• Despite massive recalls that dented its safety image, Toyota Motor Corp. said Tuesday it logged a $1.60 billion group operating profit for the business year that ended in March, reversing the $4.99 billion loss recorded a year earlier.

It posted $2.27 billion in group net profit, compared with a loss of $4.73 billion in the 2008 business year, when the global financial crisis hit and car sales in the United States and Europe tanked. Group sales slipped 7.7 percent to $205.56 billion from $221.79 billion.

The steep rebound in profit – the first in two years – comes mostly as a result of cost-cutting efforts.

The safety woes mainly affected sales in the United States and Europe, but incentives in some regions helped shore up sales, limiting the fall in revenue.

“It was a year of being constantly on alert due to the series of recall matters, which caused concerns,” President Akio Toyoda said. “The severe conditions will likely continue, but I believe there is light far away amid the storm.”

Toyota now expects profits to grow in the current business year to next March. It forecasts a $3.03 billion group operating profit and $3.35 billion net profit on $205.56 billion in sales.

The company said it will focus on next-generation environmentally friendly cars by improving technology for hybrids and expanding its lineup. Also, it will gear up sales in fast-growing economies, particularly China and India.

Profit for the last business year mainly came from production cost cuts amounting to $5.63 billion, as well as $5.08 billion worth of reductions in fixed daily costs, including for labor, research and development, the company said.

Toyota said costs linked to its spate of worldwide recalls – $1.84 billion to $1.95 billion for the business year – were within expectations.

But concerns about potential massive recalls over accelerator defects continue.

The earnings results came a day after U.S. Transportation Secretary Ray LaHood hinted at a news conference at Toyota’s headquarters in Aichi Prefecture that more fines could be imposed if needed.

Last month, Toyota agreed to pay a record $16.4 million U.S. government fine for delaying a January recall over defective accelerator pedals.

Meanwhile, the U.S. Department of Transportation’s National Highway Traffic Safety Administration said in a statement issued Monday in Washington that it has opened an investigation into whether Toyota in 2005 notified the agency of a steering relay rod safety defect within five business days of learning of the defect’s existence, as required by law.

“We will fully cooperate with the investigation,” Toyoda said at the news conference.
• Source(s): Toyota Motor Corp.

Android Shakes Up U.S. Smartphone Market

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Android Shakes Up U.S. Smartphone Market
Tuesday, May 11, 2010

••• The Android operating system (OS) covered 28 percent of the U.S. smartphone market in the first quarter of the year, replacing Apple’s iPhone OS to take #2 position.

This is the first time for Android OS to top iPhone, which covered 21 percent of the market, according to the market research firm The NPD Group, PC World said on Tuesday.

RIM’s BlackBerry OS still dominated the market in sales, having a 36 percent market share.

Much of the growth in Android OS sales came from Verizon’s Motorola Droid and HTC Droid Eris.

The average selling price for all smartphones in the first quarter was $151 in Q1 2010, a 3 percent decrease over the previous year.
• Source(s): NPD Group, Inc.

Fannie Mae asks for $8.4 billion in aid

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Fannie Mae asks for $8.4 billion in aid
Monday, May 10, 2010

••• U.S. mortgage finance company Fannie Mae has again asked taxpayers for more money after reporting a first-quarter loss of more than $13 billion.

The company, which was rescued by Washington in September 2008, said it needs an additional $8.4 billion from the government to help cover mounting losses.

Fannie Mae says it lost $13.1 billion, or $2.29 per share, in the January-March period. That takes into account $1.5 billion in dividends paid to the Treasury Department. It compares with a loss of $23.2 billion, or $4.09 a share, a year ago.

The rescue of Fannie Mae and sister company Freddie Mac is turning out to be one of the most expensive aftereffects of the financial meltdown. The new request for aid will bring Fannie Mae’s total to $83.6 billion. The total bill for the duo will now be nearly $145 billion.
Late last year, the Obama administration pledged to cover unlimited losses through 2012 for Freddie and Fannie, lifting an earlier cap of $400 billion.

Fannie and Freddie play a vital role in the U.S. mortgage market by purchasing mortgages from lenders and selling them to investors. Together the pair own or guarantee almost 31 million home loans worth about $5.5 trillion. That’s about half of all mortgages.

The two companies, however, loosened their lending standards for borrowers during the real estate boom and are reeling from the consequences.

With the housing market still on shaky ground, Obama administration officials say it is still too early to draft any proposals to reform the two companies or the broader housing finance system.

But Republicans argue the sweeping financial overhaul currently before Congress is incomplete without a plan for Fannie and Freddie. They propose transforming Fannie and Freddie into private companies with no government subsidies, or shutting them down completely.

Stocks turn negative for 2010

NEWS
Stocks turn negative for 2010
Friday, May 7, 2010

••• U.S. stocks continued to fall in early trading on Friday, with the Dow Jones industrial average and Standard & Poor’s 500 turning negative for the year as traders preferred to stay on the sidelines after Thursday’s unprecedented market plunge.

U.S. stocks saw a 10 percent correction in ten minutes on Thursday, sending investors in great panic. The Dow Jones industrial average experienced its largest-ever point decline in intraday trading, plummeting almost 1,000 points before recovering to close down about 348 points.

Speculation of bad trades emerged in the market as many traders suspected a glitch in the trading of Dow component Procter & Gambles played a role in the heavy selling.

Investors preferred to stay on the sidelines after the unprecedented plunge, even after payrolls data came in better than expected, as uncertainties over European debt problems were still haunting in the market.

According to the Labor Department, non-farm payrolls expanded by 290,000 in April, the most in four years as more confident employers stepped up hiring. The unemployment rate rose from 9.7 percent in March to 9.9 percent, mainly because 805,000 jobseekers resumed their searches for work as the economy showed more signs of recovery.

The Dow Jones industrial average dropped 112.75, or 1.07 percent, to 10,407.57. The Standard & Poor’s 500 index fell 13.14, or 1.16 percent, to 1,115.01 and the Nasdaq was down 36.41, or 1. 57 percent, to 2,283.23.
President Barack Obama says U.S. authorities are probing ‘unusual’ stock market activity which triggered a slump in the value of securities, and will act to protect investors.

Obama diverted from a statement at the White House on Friday on a sharp increase in job creation, saying he wanted to ‘speak to the unusual market activity’ that took place on Wall Street on Thursday.

‘The regulatory authorities are evaluating this closely with a concern for protecting investors and preventing this from happening again and they will make findings of their review public along with recommendations for appropriate action,’ he said.

Record 998.5 point drop for Dow Jones before recovery

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Record 998.5 point drop for Dow Jones before recovery
Thursday, May 6, 2010

••• Panic selling swept U.S. markets on Thursday as the Dow Jones plunged a record of almost 1000 points before recouping more than half those losses.

It was unclear whether the sudden sell-off, the Dow’s biggest ever intra-day drop, was the result of fears over the Greek debt crisis, a mistaken trade or technical error.

The crash began shortly before 2.25 pm EDT, when in a white-knuckle 20 minutes America’s top 30 firms saw their share prices dive 998.5 points, almost nine per cent, wiping out billions in market value.

The drop eclipsed even the crashes seen when markets reopened after September 11, 2001 and in the wake of the Lehman Brothers collapse.

The Dow later recovered, closing nearly four per cent down, but spooked traders were left wondering whether a technical glitch had caused the blue-chip index to erode three months of solid gains.

Rumours swirled that a Citigroup trader had mistakenly sold 16 billion rather than 16 million stocks in Procter and Gamble shares, forcing the Dow down.

Shares in the consumer goods giant lost more than seven U.S. dollars, falling in a similar pattern to the Dow, trading at a low of $55 a share.

‘At this point, we have no evidence that Citi was involved in any erroneous transaction,’ said company spokesman Stephen Cohen.

A spokesperson for the New York Stock Exchange said the cause was still not known.

‘We don’t know, right now we’re looking into it,’ said Christian Braakman, ‘it’s all speculation.’

But after three days in which stocks have suffered triple-digit intra-day losses because of concern about Greece’s debt crisis, it was clear that the sell-off was real for some investors.

At the close, the Dow had recovered to 10,520.32, down 347.80 (3.20 percent), while the Nasdaq was down 82.65 points (3.44 percent) at 2,319.64. The Standard Poors 500 Index was down 37.72 points (3.24 percent) to 1,128.15.

Images of rioting as the Greek parliament passed unpopular austerity measures did little to ease market panic.

The parliament approved billions of euros of spending cuts pledged in exchange for a 110 billion euros ($138.55 billion) E.U.-IMF bailout just one day after three bank workers died in a firebomb attack during a huge protest.

On Thursday, police charged to scatter hundreds of youths at the tail-end of a new protest outside parliament that drew more than 10,000 people.

In Lisbon, European Central Bank chief Jean-Claude Trichet battled to reassure financial markets that Greece’s debt crisis would not end in default, but could not prevent the euro from falling to a 14-month low against the dollar.

Pleas for patience from the White House also had little impact.

The White House said that reforms in Greece were ‘important’ but would take time and that the U.S. Treasury was monitoring the situation.

‘The president has heard regularly from his economic team,’ said White House spokesman Robert Gibbs, adding that President Barack Obama’s top economic officials were closely communicating with their European counterparts.
• Source(s): Associated Press

Freddie Mac seeks $10.6 billion in aid after 1Q loss

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Freddie Mac seeks $10.6 billion in aid after 1Q loss
Wednesday, May 5, 2010

••• Freddie Mac is asking for $10.6 billion in additional U.S. federal aid after posting a big loss in the first three months of the year.

The McLean, Virginia-based mortgage finance company has been effectively owned by the government after nearly collapsing in September 2008. The new request will bring the total tab for rescuing Freddie Mac to $61.3 billion.

But the company’s CEO Charles Haldeman said, ‘We are seeing some signs of stabilisation in the housing market, including house prices and sales in some key geographic areas’.

Freddie Mac set aside $5.4 billion to cover credit losses from bad mortgages, down from $7 billion in the final three months of last year.

Haldeman cautioned, however, that the housing market ‘remains fragile with historically high delinquency and foreclosure levels’ and high unemployment.

Created by Congress, Freddie Mac and sibling company Fannie Mae buy mortgages from lenders and package them into bonds that are resold to global investors. As the housing bubble burst, they were unable to raise enough money to stay afloat, and the government effectively nationalised them.

Since then, Uncle Sam’s share of the mortgage business has kept getting bigger. Government institutions – mainly Fannie Mae, Freddie Mac, the Federal Housing Administration and the Veterans Administration – backed nearly 97 percent of home loans in the first quarter of 2010, according to trade publication Inside Mortgage Finance.

Late last year, the Obama administration pledged to cover unlimited losses through 2012 for Freddie and Fannie. Freddie’s new request will bring the total taxpayer tab for both companies to about $136.5 billion.

Fannie Mae is expected to release earnings soon and may also request additional financial aid.

With the housing market still on shaky ground, Obama administration officials argue that it is still too early to draft any proposals to reform the two companies or the broader housing finance system.

But Republicans argue that the sweeping financial overhaul currently before Congress is incomplete without a plan for Fannie and Freddie. Senate Republicans propose transforming Fannie and Freddie into private companies with no government subsidies, or to shut them down completely.

‘The events of the past two years have made it clear that never again can we allow the taxpayer to be responsible for poorly managed financial entities who gambled away billions of dollars,’ Senator John McCain said in a statement. ‘The time has come to end Fannie Mae and Freddie Mac’s taxpayer-backed slush fund and require them to operate on a level playing field.’

But Barry Zigas, director of housing policy at the Consumer Federation of America and a former Fannie Mae executive, said Obama officials are right to take their time.

‘They are providing most of the mortgage credit that’s making it possible for Americans to buy homes and refinance their mortgages,’ Zigas said. ‘They’re vital to the housing recovery that everyone is hoping is getting started.’

But the hangover from bad loans made in during the boom years still hurts.

Freddie Mac said on Wednesday it lost $8 billion, or $2.45 a share, in the January-March period. That takes into account $1.3 billion in dividends paid to the Treasury Department. It compares with a loss of $10.4 billion, or $3.18 a share, in the first quarter last year.

The company, however, cautioned that new accounting standards make it difficult to compare the most recent quarter with the year-ago period. In the first quarter of this year, Freddie Mac was forced to bring $1.5 trillion in assets and liabilities onto its balance sheet, causing the company’s net worth to plunge by $11.7 billion.

United Airlines and Continental merge to create world’s biggest operator

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United Airlines and Continental merge to create world’s biggest operator
Monday, May 03, 2010

••• Directors at Continental and United airlines have approved a deal that would combine them into the world’s largest airline, a source said.

The stock-swap deal values Continental at about $3.2 billion.

The Sunday board actions were described by a person with knowledge of the votes, who declined to be identified because the companies plan an announcement on Monday.

Combining Continental and United would leave the US with three big international airlines – the new United, Delta, and American. U.S. Airways Group Inc also flies internationally, but its 2009 international traffic was less than one-third the size of American’s.

The combined airline will be called United, based in United’s hometown of Chicago, and run by Continental CEO Jeffery Smisek. United CEO Glenn Tilton will be chairman.

United, a unit of UAL Corp, is the nation’s third-largest carrier by traffic. Continental Airlines Inc, in Houston, is the country’s fourth biggest.

Any deal would need the approval of antitrust regulators. The Justice Department approved Delta Air Lines Inc’s purchase of Northwest in 2008, which turned Delta into the world’s biggest carrier.

Another key issue in putting the two airlines together will be integrating the pilot workforce.

A union hot line message to United pilots on Sunday said the ‘union remains engaged in this issue, and if a merger is announced by United and Continental’, union officials ‘are fully prepared to protect and defend the interests of all United pilots’.

Continental and United both trace their roots to air services founded by Walter Varney in the 1920s and 30s.

One of United’s main attractions is its Pacific routes, which it bought from Pan-Am in 1985. It was already the biggest carrier in the U.S., and the Pan-Am deal made it a major international carrier for the first time. Northwest’s Pacific routes were one reason Delta pursued that deal two years ago.

Continental jumped in size in 1987 by swallowing Frontier, People Express and New York Air.

Both airlines shrank to cope with the recession. United cut capacity 7.4 percent last year, and Continental shrank 5.2 percent.

And they’ve both been losing money. Continental reported a 2009 loss of $282 million as revenue plunged 17.4 percent to $12.59 billion. UAL lost $651 million for the year as revenue fell 19.1 percent to $16.34 billion.

The market capitalisation for UAL Corp on Friday was $3.62 billion, while Continental’s was $3.12 billion.

Just two years ago, American Airlines was the nation’s biggest carrier. First Delta surpassed it, and now United might. More than pride is at stake. Corporate travellers gravitate toward airlines with the most routes.

On April 8, when there was talk that United and U.S. Airways were discussing a deal, American CEO Gerard Arpey said the company was ‘not in any way threatened’ by the merger talk involving other carriers.

‘We think we’re in a very good position irrespective of what may happen,’ he said at the time.

Goldman Sachs under criminal investigation

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Goldman Sachs under criminal investigation
Saturday, May 1, 2010

••• Federal prosecutors have opened a preliminary criminal investigation into alleged fraud at Goldman Sachs, sending shares in the Wall Street bank plunging.

Sources confirmed the U.S. attorney’s office had begun liaising with the Securities and Exchange Commission, which brought civil charges against Goldman two weeks ago, accusing it of misleading investors over a $1 billion derivatives deal.

Prosecutors have not yet determined whether there is evidence to bring criminal charges.

Goldman shares fell more than 9 percent on Friday to close at $145. Before the commission sued the company on April 16, its stock stood at $184.

The commission claims the bank cheated customers in a 2007 deal concerning a mortgage-backed security. Goldman allegedly failed to tell investors that U.S. hedge fund Paulson & Co was going “short” by betting that the security would decline in value. Paulson was allegedly allowed to stuff it with mortgages doomed to default. Royal Bank of Scotland backstopped the deal and was left with an $840 million liability.

The British Financial Services Authority is also investigating.

Samsung Electronics posts record Q1, says optimistic on Q2

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Samsung Electronics posts record Q1, says optimistic on Q2
Friday, April 30, 2010

••• Samsung Electronics says net profit has surged in the first quarter of this year amid higher sales.

The company said on Friday that it earned 3.99 trillion won ($3.58 billion) in the three months ended March 31. It had net profit of 580 billion won ($520.26 million) the year before.

Samsung said sales in the first quarter totalled 34.64 trillion won ($31.07 billion). That was 20.8 percent higher than the 28.67 trillion won ($25.72 billion) reported a year earlier.

Samsung is the world’s largest manufacturer of computer memory chips, flat screen televisions and liquid crystal displays. It ranks No.2 in mobile phones behind Finland’s Nokia Corp.

Samsung Electronics said yesterday that it plans to significantly increase its investment in both chips and flat-screens in 2010, giving a bullish outlook for the remainder of this year.

Samsung posted a historic high operating profit of 4.41 trillion won ($3.9 billion) in the first quarter, mainly driven by the stellar performance of its chip business, which reported 1.96 trillion won in operating profits. Its operating profits are slightly higher than its earlier forecast of 4.3 trillion won ($3.88 million). Samsung’s first-quarter sales reached 3.99 trillion won, compared with its guidance of 34 trillion won.

Samsung expected its earnings to further improve in the second quarter, and said it was “cautiously optimistic” about the second half as well, expecting strong demand for memory and LCDs, and a sales increase for handsets and TVs.

Samsung is the world’s top maker of memory chips, LCD panels and LCD TVs, and the No. 2 handset vendor.

“In order to address the increased demand in the market, we are planning to substantially increase the capital expenditure from the initial guidance, which was 5.5 trillion ($4.93 billion) for memory and 3 trillion ($2.69 billion) for LCDs,” Robert Yi, Samsung’s head of investor relations, said at an earnings conference call yesterday.

Media and analysts have speculated that Samsung may expand its chip investment to more than 7.5 trillion won ($6.73 billion) and its LCD spending to 4.5 trillion won ($4.04 billion) this year.

As for the memory market, Samsung expected supply and demand to remain tight for both DRAM and NAND in the current quarter, saying that a supply increase may not be enough to catch up with robust demand.

However, Samsung’s LCD division posted a lower-than-expected operating profit of 490 billion won ($439.53 million), ceding its top position in terms of profitability to its rival LG Display. LG, the world’s No. 2 LCD maker by sales, reported first-quarter operating profit of 789.4 billion won ($708.09 million), which beat market forecasts.

Samsung said the fall was mainly caused by depreciation costs, and expected an improved profit in the current quarter.

Samsung faces an increasing threat from LG Display, which seeks to catch up not only in profit but sales, with aggressive investment plans. To cope with the challenge, Samsung may spend an additional 1.5 trillion won ($1.35 billion) in expanding its eighth-generation LCD line, on top of the already earmarked 3 trillion won ($2.69 billion), market watchers say.

Yi said that a revision of its investment may be announced before the second-quarter earnings results will be announced in July.

Samsung’s mobile operating profit beat expectations, reaching 1.1 trillion won ($986.7 million). Samsung’s telecommunications division, which includes its handset business, posted a 12 percent operating profit margin, which Samsung ascribed to a reduction in marketing costs and strong sales of mid-end and high-end devices, especially touchscreen phones and messaging phones. Samsung expects a double-digit operating margin for its handset business this year, according to Yi.

A Samsung executive also said during the conference call that the company aims to achieve handset sales that would exceed its initial target of 270 million units this year. Samsung also expected that Android phones would account for more than half of its smartphones this year, while models based on its proprietary Bada platform will make up one third of its total smartphone models.
Yi said Samsung was developing a tablet-like PC which would challenge Apple’s iPad, and said the new model would hit the market after the first half of this year.

Samsung’s Digital Media division, which includes its TV business, saw its operating profit increase 11 percent to 520 billion won ($466.44 million) this year. Its TV sales reached a record high of 8.4 million units in the January to March period, up by nearly 50 percent from a year ago, driven by the growth of shipments to both advanced and developing markets, the company said.

Samsung shares jumped 2.9 percent at yesterday’s close, while the broader market rose 0.8 percent.

Protesters enter NYC bank buildings before rally

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Protesters enter NYC bank buildings before rally
Thursday, April 29, 2010

••• Noisy protesters with signs took over three bank building lobbies on Thursday in a prelude to a Wall Street rally by workers and union leaders angry over lost jobs, the taxpayer-funded bailout of financial institutions and questionable lending practices by big banks.

Hours before the scheduled rally, more than 100 people entered a midtown Manhattan building housing JPMorgan Chase offices. They handed a bank executive a letter requesting a meeting with the CEO, and chanted ‘Bust up big banks!’ and ‘People power!’
A half-hour later, they were calmly escorted outside by officers, who remained expressionless as the protesters chanted, ‘The police need a raise.’

They then walked a few blocks down Park Avenue and crowded into a Wells Fargo and Wachovia building lobby. Police arrived on horseback as curious office workers watched the scene unfold from their windows.
‘We’re here today to stop the corporate greed that is ruining our neighbourhoods,’ said Andrea Goldman, 59, who’s part of a group called Alliance to Develop Power.

Sign slogans included: ‘Save Our Jobs’ and ‘Save Our Homes’.

The banks did not immediately respond to requests for comment.

Thousands of workers and union members were expected at the rally, organised by the AFL-CIO, the largest federation of North American labour unions, and an association of community groups.

The Securities Industry and Financial Markets Association, which includes many Wall Street financial institutions, declined to comment.

Google ranked world’s most valuable brand

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Google ranked world’s most valuable brand
Thursday, April 29, 2010

••• Google was crowned the world’s most valuable brand on Wednesday by a research firm that found technology firms dominate when it comes to how much a name is worth in today’s markets.

Google, IBM, Apple and Microsoft topped global stalwarts Coca-Cola, McDonald’s, and Marlboro in a Top Ten brand value list packed with seven technology companies.

Google’s brand was worth more than $114 billion, a 14 percent climb from 2009, according to the annual Millward Brown Optimor ‘BrandZ Top 100 Most Valuable Global Brands’ report.
U.S. technology titan IBM saw its ‘brand value’ surge 30 percent to $86 billion while the worth of Apple’s name climbed 32 percent to $83 billion, according to the report.

Factors taken into consideration in the ranking include customer loyalty and opinions regarding brands and how they influence earnings.

Microsoft ranked fourth with its brand valued at slightly more than $76 billion, just ahead of the nearly $68 billion that Coca-Cola’s brand was said to be worth.

China Mobile, General Electric, and Vodafone claimed the eighth through tenth spots respectively.

Social-networking powerhouse Facebook made it onto a separate Top Twenty technology brands list for the first time with its company name value at $5.5 billion.

Electronics powerhouse Samsung saw the largest jump in brand value, soaring 80 percent from the previous year to $11.3 billion.

‘Technology brands demonstrated their pervasiveness in our daily lives,’ Millward Brown said in a release. ‘Use of social media was a key trend across many of the successful brands.’

The overall value of the Top 100 brands rose four per cent to more than two trillion dollars, according to Millward Brown, which specialises in advertising, marketing communications, media and brand equity research.

‘This ranking has elevated the importance of building brands among some of the world’s most successful companies,’ said Millward Brown global chief executive Eileen Campbell.

‘CEOs and CFOs around the world should be asking their brand and marketing teams how they can leverage brand to both protect and grow the business.’

An investor who put their money into a Brandz portfolio five years ago would have earned a double-digit return as opposed to losing cash with a set of stocks based on the SP 500 index, according to Millward Brown.

‘In the past, many companies were quick to cut their marketing spend during a down economy,’ said Joanna Seddon, head of Millward Brown Optimor.

‘A new trend has emerged in the wake of the recession as more companies realised the importance of maintaining and even increasing budgets to support brand loyalty and engagement.’
• Source(s): Millward Brown

Goldman’s defense? We’re misunderstood

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Goldman’s defense? We’re misunderstood
Wednesday, April 28, 2010

••• Goldman Sachs on Tuesday denied reaping vast profits from the collapse of the U.S. housing market as its top executive and a star trader faced hostile questions in Congress over the 2008 financial meltdown.

In angry exchanges before a Senate investigative committee, the storied Wall Street firm was accused of fuelling a crisis that forced thousands of Americans from their homes and continues to ravage the U.S. economy.

Top Goldman Sachs officials have defended their conduct in the financial crisis, flatly disputing the government’s fraud allegations against the giant financial house. I did not mislead investors, insisted a trading executive at the heart of the government’s case.

But they ran into a wall of bipartisan wrath before a Senate panel investigating Goldman’s role in the financial crisis and the Securities and Exchange Commission fraud suit against it and one of its traders. Sen. Carl Levin (D-Mich.) accused Goldman on Tuesday of making risky financial bets.

About a half dozen protesters were in the committee room, dressed in prison stripes with names on signs around their necks of Fabrice Tourre, the only company official directly accused in the SEC suit, and Goldman CEO Lloyd Blankfein, who was also scheduled to testify.

Goldman Sachs: Lloyd Blankfein Says Firm Doesn’t Need to Disclose Position

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Goldman Sachs: Lloyd Blankfein Says Firm Doesn’t Need to Disclose Position
Tuesday, April 27, 2010

••• Goldman Sachs on Tuesday denied reaping vast profits from the collapse of the U.S. housing market as its top executive and a star trader faced hostile questions in Congress over the 2008 financial meltdown.

In angry exchanges before a Senate investigative committee, the storied Wall Street firm was accused of fuelling a crisis that forced thousands of Americans from their homes and continues to ravage the U.S. economy.

Democratic Senator Carl Levin, the panel’s chairman, assailed Goldman as representative of Wall Street’s ‘unbridled greed,’ drawing them into a raging political battle over financial reform.

The Senate was expected to vote later on Tuesday on whether to proceed with debate about the most sweeping financial reforms in a generation, a day after Republicans successfully blocked a similar move.

Against this caustic backdrop executives battled to salvage the firm’s reputation, rejecting charges – recently filed by a U.S. watchdog – that Goldman sold clients a complex financial product devised by some who bet against it.

Levin demanded to know why Goldman had been ‘trying to sell a shitty deal’ to investors, fuming that ‘as we speak, lobbyists fill the halls of Congress hoping to weaken or kill reforms that would end these abuses.’
French trader Fabrice Fabulous Fab Tourre, who is at the centre of the Securities and Exchange Commission’s case against the firm, was among the first to be dragged before the committee.

He denied any wrongdoing: ‘I deny – categorically – the SEC’s allegation. And I will defend myself in court against this false claim,’ said Tourre.

‘I have been the target of unfounded attacks on my character and motives.’

If Goldman executives hoped to get an easier ride from Republicans, they may have been disappointed. Former Republican presidential candidate John McCain was scathing.

‘I don’t know if Goldman Sachs has done anything illegal,’ he said, adding that ‘from the reading of these emails and the information that this committee has uncovered there is no doubt their behaviour was unethical and the American people will render a judgment as well as the courts.’

Goldman chief executive Lloyd Blankfein was due to appear later in the day, but in prepared testimony said there was nothing wrong with Goldman hedging its bets by holding ”short” positions that would benefit the firm if housing prices collapsed.

‘(We) didn’t have a massive short (position) against the housing market and we certainly did not bet against our clients,’ he said.

‘If our clients believe that we don’t deserve their trust, we cannot survive,’ he said. ‘We believe that we managed our risk as our shareholders and our regulators would expect.’

Blankfein also said that, ‘while profitable overall,’ Goldman lost about $1.2 billion from investments tied to the residential housing market.
In the hearing, Levin pointed to Goldman email messages he said refuted the firm’s claims.

In one November 2007 message from Blankfein, he says: ‘Of course we didn’t dodge the mortgage mess. We lost money, then made more than we lost because of shorts,’ which are essentially bets that the market will drop.

Goldman Sachs on Tuesday denied reaping vast profits from the collapse of the U.S. housing market as its top executive and a star trader faced hostile questions in Congress over the 2008 financial meltdown.

In angry exchanges before a Senate investigative committee, the storied Wall Street firm was accused of fuelling a crisis that forced thousands of Americans from their homes and continues to ravage the U.S. economy.

Democratic Senator Carl Levin, the panel’s chairman, assailed Goldman as representative of Wall Street’s ‘unbridled greed,’ drawing them into a raging political battle over financial reform.

The Senate was expected to vote later on Tuesday on whether to proceed with debate about the most sweeping financial reforms in a generation, a day after Republicans successfully blocked a similar move.

Against this caustic backdrop executives battled to salvage the firm’s reputation, rejecting charges – recently filed by a U.S. watchdog – that Goldman sold clients a complex financial product devised by some who bet against it.

Levin demanded to know why Goldman had been ‘trying to sell a shitty deal’ to investors, fuming that ‘as we speak, lobbyists fill the halls of Congress hoping to weaken or kill reforms that would end these abuses.’

French trader Fabrice Fabulous Fab Tourre, who is at the centre of the Securities and Exchange Commission’s case against the firm, was among the first to be dragged before the committee.
He denied any wrongdoing: ‘I deny – categorically – the SEC’s allegation. And I will defend myself in court against this false claim,’ said Tourre.

‘I have been the target of unfounded attacks on my character and motives.’

If Goldman executives hoped to get an easier ride from Republicans, they may have been disappointed. Former Republican presidential candidate John McCain was scathing.

‘I don’t know if Goldman Sachs has done anything illegal,’ he said, adding that ‘from the reading of these emails and the information that this committee has uncovered there is no doubt their behaviour was unethical and the American people will render a judgment as well as the courts.’

Goldman Sachs and “War Profiteering”

NEWS
Goldman Sachs and “War Profiteering”
Monday, April 26, 2010

••• Embattled Wall Street investment giant Goldman Sachs has hit back at claims it used the U.S. sub-prime mortgage crisis to make tens of millions of dollars in profit.

The financial giant, already facing fraud charges, found itself in the middle of a new firestorm on Saturday after emails released by a U.S. Senate panel suggested Goldman executives made huge profits out of the 2007 crisis.

Goldman fired back on Sunday, accusing the Senate Permanent Subcommittee on Investigations of having ‘cherry-picked just four emails from the 20 million pages of documents and emails provided to it’.

‘It is concerning that the subcommittee seems to have reached its conclusion even before holding a hearing,’ added Goldman Sachs spokesman Lucas van Praag.

The emails come at a bad time for Goldmans Sachs.

Earlier this month, the U.S. Securities and Exchange Commission announced it was charging the company with fraud, accusing it of ‘defrauding investors by misstating and omitting key facts’ about a product based on subprime, or higher-risk mortgage-backed securities.

On Saturday, subcommittee chairman Democratic Senator Carl Levin said Goldman Sachs and other investment banks had acted as ‘self-interested promoters of risky and complicated financial schemes that helped trigger the crisis’.

He said the bank had bundled toxic mortgages into complex financial instruments, got credit rating agencies to label them as AAA securities, and then sold them to investors, magnifying and spreading risk throughout the financial system.

In addition, Levin said, the bank often bet against the instruments it sold and rolled in profits as a result.

Van Praag said on Sunday the company had net losses of over $1.2 billion in residential mortgage-related products in 2007 and 2008.

‘This demonstrates conclusively that we did not make a significant amount of money in the mortgage market,’ he said.

But the four emails released by the subcommittee suggest that the company was able to make massive profits by shorting products including residential mortgage-backed securities and collateralised debt obligations (CDOs).

In one email, Goldman Sachs chairman and chief executive officer Lloyd Blankfein appeared to gloat about the strategy in an exchange with other top Goldman executives.

‘Of course we didn’t dodge the mortgage mess. We lost money, then made more than we lost because of shorts,’ the message said.

In another, a Goldman Sachs manager noted that the firm had bet against 32 billion dollars in mortgage-related securities that had been downgraded by credit rating agencies, causing losses for many investors.

‘Sounds like we will make some serious money,’ the manager wrote.

‘Yes, we are well positioned,’ his colleague responded.

In a third email, Goldman employees discussed securities that were underwritten and sold by the company and tied to mortgages issued by Washington Mutual Bank’s subprime lender, Long Beach Mortgage.

One employee reported the ‘wipeout’ of one Long Beach security and the ‘imminent’ collapse of another as ‘bad news’ that would cost the firm $2.5 million.

The ‘good news,’ the employee wrote, was that Goldman had bet against the very securities it had assembled and sold, meaning the failure would net the company five million dollars.

Blankfein and other current and former company personnel are scheduled to testify before the subcommittee on Tuesday.

Goldman Sachs e-mails show bank sought to profit from housing downturn

NEWS
Goldman Sachs e-mails show bank sought to profit from housing downturn
Saturday, April 24, 2010

••• In late 2007 as the mortgage crisis gained momentum and many banks were suffering losses, Goldman Sachs executives traded e-mail messages saying that they would make “some serious money” betting against the housing markets.

The e-mails, released Saturday morning by the Senate Permanent Subcommittee on Investigations, appear to contradict some of Goldman’s previous statements that left the impression that the firm lost money on mortgage-related investments.

In the e-mails, Lloyd C. Blankfein, the bank’s chief executive, acknowledged in November of 2007 that the firm indeed had lost money initially. But it later recovered from those losses by making negative bets, known as short positions, enabling it to profit as housing prices fell and homeowners defaulted on their mortgages. “Of course we didn’t dodge the mortgage mess,” he wrote. “We lost money, then made more than we lost because of shorts.”

In another message, dated July 25, 2007, David A. Viniar, Goldman’s chief financial officer, remarked on figures that showed the company had made a $51 million profit in a single day from bets that the value of mortgage-related securities would drop. “Tells you what might be happening to people who don’t have the big short,” he wrote to Gary D. Cohn, now Goldman’s president.

The messages were released Saturday ahead of a Congressional hearing on Tuesday in which seven current and former Goldman employees, including Mr. Blankfein, are expected to testify. The hearing follows a recent securities fraud complaint that the Securities and Exchange Commission filed against Goldman and one of its employees, Fabrice Tourre, who will also testify on Tuesday.

Actions taken by Wall Street firms during the housing meltdown have become a major factor in the contentious debate over financial reform. The first test of the administration’s overhaul effort will come Monday when the Senate majority leader, Harry Reid, is to call a procedural vote to try to stop a Republican filibuster.

Republicans have contended that the renewed focus on Goldman stems from Democrats’ desire to use anger at Wall Street to push through a financial reform bill.

Carl Levin, Democrat of Michigan and head of the Permanent Subcommittee on Investigations, said that the e-mail messages contrast with Goldman’s public statements about its trading results. “The 2009 Goldman Sachs annual report stated that the firm ‘did not generate enormous net revenues by betting against residential related products,’?” Mr. Levin said in a statement Saturday when his office released the documents. “These e-mails show that, in fact, Goldman made a lot of money by betting against the mortgage market.”

A Goldman spokesman did not immediately respond to a request for comment.

The Goldman messages connect some of the dots at a crucial moment of Goldman history. They show that in 2007, as most other banks hemorrhaged losses from plummeting mortgage holdings, Goldman prospered.

At first, Goldman openly discussed its prescience in calling the housing downfall. In the third quarter of 2007, the investment bank reported publicly that it had made big profits on its negative bet on mortgages.

But by the end of that year, the firm curtailed disclosures about its mortgage trading results. Its chief financial officer told analysts at the end of 2007 that they should not expect Goldman to reveal whether it was long or short on the housing market. By late 2008, Goldman was emphasizing its losses, rather than its profits, pointing regularly to write-downs of $1.7 billion on mortgage assets and leaving out the amount it made on its negative bets.

Goldman and other firms often take positions on both sides of an investment. Some are long, which are bets that the investment will do well, and some are shorts, which are bets the investment will do poorly. If an investor’s positions are balanced – or hedged, in industry parlance – then the combination of the longs and shorts comes out to zero.

Goldman has said that it added shorts to balance its mortgage book, not to make a directional bet that the market would collapse. But the messages released Saturday appear to show that in 2007, at least, Goldman’s short bets were eclipsing the losses on its long positions. In May 2007, for instance, Goldman workers e-mailed one another about losses on a bundle of mortgages issued by Long Beach Mortgage Securities. Though the firm lost money on those, a worker wrote, there was “good news”: “we own 10 mm in protection.” That meant Goldman had enough of a bet against the bond that, over all, it profited by $5 million.

Documents released by the Senate committee appear to indicate that in July 2007, Goldman’s daily accounting showed losses of $322 million on positive mortgage positions, but its negative bet – what Mr. Viniar called “the big short” – came in $51 million higher.

As recently as a week ago, a Goldman spokesman emphasized that the firm had tried only to hedge its mortgage holdings in 2007 and said the firm had not been net short in that market.

The firm said in its annual report this month that it did not know back then where housing was headed, a sentiment expressed by Mr. Blankfein the last time he appeared before.

“We did not know at any minute what would happen next, even though there was a lot of writing,” he told the Financial Crisis Inquiry Commission in January.

It is not known how much money in total Goldman made on its negative housing bets. Only a handful of e-mail messages were released Saturday, and they do not reflect the complete record.

The Senate subcommittee began its investigation in November 2008, but its work attracted little attention until a series of hearings in the last month. The first focused on lending practices at Washington Mutual, which collapsed in 2008, the largest bank failure in American history; another scrutinized deficiencies at several regulatory agencies, including the Office of Thrift Supervision and the Federal Deposit Insurance Corporation.

A third hearing, on Friday, centered on the role that the credit rating agencies – Moody’s, Standard & Poor’s and Fitch – played in the financial crisis. At the end of the hearing, Mr. Levin offered a preview of the Goldman hearing scheduled for Tuesday.

“Our investigation has found that investment banks such as Goldman Sachs were not market makers helping clients,” Mr. Levin said, referring to testimony given by Mr. Blankfein in January. “They were self-interested promoters of risky and complicated financial schemes that were a major part of the 2008 crisis. They bundled toxic and dubious mortgages into complex financial instruments, got the credit-rating agencies to label them as AAA safe securities, sold them to investors, magnifying and spreading risk throughout the financial system, and all too often betting against the financial instruments that they sold, and profiting at the expense of their clients.”

The transaction at the center of the S.E.C.’s case against Goldman also came up at the hearings on Friday, when Mr. Levin discussed it with Eric Kolchinsky, a former managing director at Moody’s. The mortgage-related security was known as Abacus 2007-AC1, and while it was created by Goldman, the S.E.C. contends that the firm misled investors by not disclosing that it had allowed a hedge fund manager, John A. Paulson, to select mortgage bonds for the portfolio that would be most likely to fail. That charge is at the core of the civil suit it filed against Goldman.

Moody’s was hired by Goldman to rate the Abacus security. Mr. Levin asked Mr. Kolchinsky, who for most of 2007 oversaw the ratings of collateralized debt obligations backed by subprime mortgages, if he had known of Mr. Paulson’s involvement in the Abacus deal.

“I did not know, and I suspect – I’m fairly sure that my staff did not know either,” Mr. Kolchinsky said.

Mr. Levin asked whether details of Mr. Paulson’s involvement were “facts that you or your staff would have wanted to know before rating Abacus.” Mr. Kolchinsky replied: “Yes, that’s something that I would have personally wanted to know.”

Mr. Kolchinsky added: “It just changes the whole dynamic of the structure, where the person who’s putting it together, choosing it, wants it to blow up.”

The Senate announced that it would convene a hearing on Goldman Sachs within a week of the S.E.C.’s fraud suit. Some members of Congress questioned whether the two investigations had been coordinated or linked.

Mr. Levin’s staff said there was no connection between the two investigations. They pointed out that the subcommittee requested the appearance of the Goldman executives and employees well before the S.E.C. filed its case.

Apple Market Cap Bigger Than Microsoft? Not Quite Yet, It Isn’t

NEWS
Apple Market Cap Bigger Than Microsoft? Not Quite Yet, It Isn’t
Saturday, April 24, 2010

••• Boosted by upbeat investor reaction to its strong earnings report this week, Apple on yesterday became the second largest company on the S&P 500 Index in terms of market capitalization, surpassing software giant Microsoft.
Revenge, they say, is a dish that is best served cold. And if this is true, then Apple must be pleased as punch to see itself in the second spot in the S&P 500, second only to Exxon Mobil.

While coming second is in itself notable – with the notable exception of coming first – what must be especially pleasing to Apple is the company it has replaced – Microsoft.

To understand this, you must travel back in time to 1988. In that year, Apple filed a case against Microsoft, claiming that the Windows graphical user interface (GUI) infringed upon the Mac’s “look and feel.” Of course, since Apple had itself borrowed the Mac’s look and feel by looking at products from Xerox and feeling that the GUI is a good thing, the judges of the United States Court of Appeals for the Ninth Circuit ruled that Apple cannot get patent-like protection for the idea of a GUI.

What is more humiliating than being beaten by an opponent? Running back to the same opponent for help when you are down. And Apple was forced to do this in 1997, when Steve Jobs announced that Apple would join Microsoft to release new versions of Microsoft Office for the Macintosh, and that Microsoft made a $150 million investment in non-voting Apple stock. The money made a huge difference to Apple because in 1997 Apple was in deep trouble and was facing a huge finance crunch.

Enough history. Cut to the here and now. Apple is on top and has ousted Microsoft to become the No 2 company on the S&P index. It would be wrong to say that its iPod, iPhone and iPads are selling like hot cakes – it would perhaps be better to say that hot cakes are selling like iPads.

Purists may argue that the S&P 500 represents merely float-adjusted market cap. In fact, as Marco Tabini posted on macworld.com, “Microsoft’s full market cap still outstrips Apple’s by $275 billion to $241 billion.”

True, Microsoft’s market cap is still higher, but Apple has one psychological advantage that was once enjoyed by Microsoft in the PC era – the ability to drive the direction of the market. Now, Apple decides what happens.

Want proof? The iPad now accounts for 26 per cent of all of the mobile traffic on wired.com. The site is so impressed that they are making their Flash-heavy pages iPad compatible. “We are aware of the irony that the majority of wired.com’s videos, which use an Adobe Flash-based player, don’t play on the iPad. We’re working on that, starting with our homepage,” wrote Dylan F. Tweney in an article that appeared on the site.

Many many moons ago, when Steve Jobs hired John Sculley from Pepsi, he is reputed to have asked him, “Do you want to spend the rest of your life selling sugared water or do you want a chance to change the world?” Scully didn’t change the world. In fact, during his regime, Microsoft threatened to discontinue Office for the Mac if Apple did not licence parts of the Mac GUI for use with Windows. And those days, Microsoft got what it wanted. But it looks like iPad has just turned the tables.

• What is S&P 500?
The S&P 500 is a free-float capitalization-weighted index published since 1957 of the prices of 500 large-cap common stocks actively traded in the United States. After the Dow Jones Industrial Average, the S&P 500 is the most widely followed index of large-cap American stocks. It is considered a bellwether for the American economy.

Software giant Microsoft posts 35 percent jump in profit in Q3

NEWS
Software giant Microsoft posts 35 percent jump in profit in Q3
Friday, April 23, 2010

••• Software giant Microsoft said on Thursday that its third-quarter net profit rose 35 percent to $4.01 billion, slightly better than expectations.

Microsoft said revenue hit a record $14.50 billion in the quarter which ended on March 31, up six percent over the same period a year ago.

‘Windows 7 continues to be a growth engine, but we also saw strong growth in other areas like Bing search, Xbox Live and our emerging cloud services,’ Microsoft chief financial officer Peter Klein said in a statement.

Microsoft said revenue from its Windows computer operating system was up 28 percent over a year ago, driven by strong demand for the latest version, Windows 7.

‘Business customers are beginning to refresh their desktops and the momentum of Windows 7 continues to be strong,’ chief operating officer Kevin Turner said.

Microsoft’s fiscal fourth-quarter revenue will meet or exceed PC market revenues, said Klein, driven by a full pipeline of product updates including Office 2010, SQL server and SharePoint 2010.”You’ll see a wave of product launches in the fourth quarter,” Klein said.”Our business will continue to grow stronger than the market.”
• Source(s): Microsoft Corporation

Treasury Unveils New $ 100 Bill

NEWS
Treasury Unveils New $ 100 Bill
Wednesday, April 21, 2010

••• If you’ve wondered why Benjamin Franklin’s expression on the $100 bill never changes, it’s because he’s been getting regular botox injections. He would love to show emotion, but unfortunately he can’t. This year, he’ll be getting a little more work done, his first since 1996.

The Bureau of Engraving and Printing has created site with interactive tools that showcases the security features of the new $100 bill or you can check out their PDF explaining everything in great detail.
Here are some, but not all, of the cool new security features:

• 3-D Security Ribbon: You can’t miss it, it’s a blue ribbon that goes down the middle of the bill. When you tilt it, you will be able to see italics 100s written vertically. The ribbon is woven into the bill itself, it’s not on top of the paper.
• Inkwell: There’s a new orange inkwell near Franklin’s left shoulder. When you tilt the bill, you will see the Liberty Bell in that inkwell.
• Portrait Watermark: To the right of the Department of the Treasury Seal should be a portrait watermark, a feature that is in use on other redesigned bills.
• Color shifting 100: Finally, the orange 100 in the lower right will change colors as you tilt it, a feature that was included in all recent bill redesigns.
• Huge 100 on the Back: If you didn’t like the enormous 5 on the redesigned $5 bill, you might not like the gynormous gold 100 on the back of the new $100. Like on the $5, this was done to help those who are visually impaired.
• Microprinting: “The United States of America” is printed in tiny letters on Franklin’s collar, “USA 100″ is around the blank space of the watermark, “One Hundred USA” along the golden quill, and finally 100s on the borders of the bill.

• Source(s): NewMoney.gov
▪ THE DEPARTMENT OF THE TREASURY ▪ BUREAU OF ENGRAVING AND PRINTING ▪ FEDERAL RESERVE BOARD ▪ U.S. SECRET SERVICE