Monday, July 20, 2009

Quick Notes and Articles for the Day - July 20

Leading Economic Indicators Rise - The Conference Board reported Monday the at the US index of leading economic indicators rose 0.7% in June which was higher than the expected rise of 0.5%. June's reading marked the third straight month the index has risen.

CIT Gets $3 Billion Deal to Avoid Bankruptcy - CIT Group reached a $3 billion rescue-financing agreement with key bondholders that will allow the business lender to avoid bankruptcy and restructure outside court, according to a media report Sunday (to be announced Monday per The Wall Street Journal). The news followed reports over the weekend that CIT had been trying to negotiate rescue financing with a group of bondholders to avoid filing for bankruptcy that could have taken place on Monday. A report by Dow Jones Newswires, also citing unnamed sources, said the plan being considered would involve new funds for CIT instead of a rollover of existing debt.

Iceland Has a Bank Recapitalization Plan - Iceland's government announced Monday it will recapitalize its three leading banks at a cost of 270 billion Icelandic kronur ($2.1 billion). Islandsbanki, New Kaupthing and New Landsbanki were started in the wake of the collapse of the main Icelandic banks last October. Iceland was in such disarray that it eventually was forced to seek a bailout from the IMF.


Europe Thumps U.S., Again - The Wall Street Journal - "On present trends, most of Europe will soon have lower income tax rates than most of America. And now the European Union is stealing another competitive march on Washington, this time on a free trade deal with the world's 13th largest economy, fast-growing South Korea."

Costs and Benefits - The New York Times - "Democrats pushing for health care reform got serious jolts last week from critics who warned that their proposed legislation would do little to slow spiraling health care costs."

What's Up, Docs? - The Wall Street Journal - "'In general, the proposals under discussion are not patient focused or results oriented. . . .'"

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