Bank of America to Buy Countrywide
Reuters reports that Bank of America is buying Countrywide for $4 billion.The purchase marks another acquisition for Bank of America Chief Executive Kenneth Lewis, who has spent more than $100 billion since 2004 to create the second-largest U.S. bank and the nations largest consumer bank.It also provides a lifeline for Countrywide, which became a poster child for what critics say were lending excesses that fueled the housing and credit meltdown.The largest U.S. mortgage lender has been convulsed by mounting losses and defaults, a loss of access to credit markets, and a slew of lawsuits and regulatory probes into its lending practices and Chief Executive Angelo Mozilos pay. On Tuesday, it denied rumors that it might go bankrupt.Countrywide has been hit very hard by the housing and credit problems. The deal is a big save for them and their shareholders but there are questions about what it means for Bank of America. SeekingAlpha says Bank of America will lose billions in the deal to acquire Countrywide. The Economist calls BofAs purchase a big gamble. Time will tell but it does sound like a risky acquisition.Permalink | Recent Headlines | WWFeeds.com
Christmas Price Index Climbs in 2007
Prices are soaring and it will be more expensive to buy your True Love the Twelve Days of Christmas this year. The PNC Christmas Price Index says the significantly higher price of gold and increased compensation for minimum wage workers will make Christmas more expensiv. The PNC Christmas Price Index is a tongue-in-cheek economic analysis by PNC Wealth Management based on the cost of gifts in The Twelve Days of Christmas.According to the 23rd annual survey, the cost of The Twelve Days of Christmas is $19,507 in 2007, a 3.1 percent increase over last year. The rise in gift prices mirrored the U.S. governments Consumer Price Index. The Consumer Price Index is up 3.5 percent so far this year.Each year, the Christmas Price Index reflects trends in the broader economy, said James Dunigan, managing executive of investments for PNC Wealth Management. This year, increased commodities prices, concerns about the value of the dollar and the first minimum wage increase in 10 years were major factors in the increases to the Christmas Price Index.For example, True Loves are paying more this year for the five Gold rings. You can see an explanation of this below. There is also a video on the PNCs website.True Loves will have to pay a bit more for the five Gold Rings this year, as the jewelers who provide the prices for the rings report having no choice but to pass increased prices along to consumers as the price of gold continues to rise.The cost of the Gold Rings in this years Christmas Price Index reflects the general trend of increasing commodity prices in the Consumer Price Index, including gold, said Dunigan. In addition, increased fears about inflation and the value of the dollar may have led investors to turn to gold as a safer place to invest their money.The price of five gold rings now totals $395, a 21.5 percent increase over 2006 prices, but still nowhere close to 1989 prices, when the five Gold Rings hit an all-time high of $750.Milkmaids Benefit from Minimum Wage IncreaseAs the only unskilled laborers in the Christmas Price Index, the eight Maids-a-Milking make minimum wage, and have not had a raise since 1997. This year, Congress increased their wages by 13.6 percent; bringing the cost of eight Maids-a-Milking for one hour of work to $46.80. The True Love will have to reach deeper into his pockets for the milkmaids in 2008 and 2009, as well - Congress has already approved continued increases to the minimum wage for the next two years.The cost of most performers in the index - the Drummers Drumming, Pipers Piping and Lords-a-Leaping - rose a modest 3 to 4 percent, due primarily to an increase in the performers compensation, reflecting the current labor market in which the unemployment rate is still below 5 percent. Only the price for the Ladies Dancing was unchanged this year, according to Philadanco, a modern dance company in Philadelphia.Food Prices Are For the BirdsAmong the feathered friends in the Christmas Price Index, the most notable increase was a 20 percent change in the price for six Geese-a-Laying, provided by the National Aviary.For True Loves planning to serve a Christmas goose - or six - for a holiday meal, this item will be a bit more expensive, said Dunigan. Food prices have increased over the last year, which has not impacted birds like Turtle Doves and Partridges, but has had an impact on birds traditionally served as food, like Geese.Most of the other bird prices in the index remained even with last years rates, thanks to steady supply and demand for Partridges, Turtle Doves, French Hens and Swans. Aside from the Geese-a-Laying, only the Calling Birds will cost more in 2007. PNC prices the Calling Birds from a national pet store chain, and prices for Calling Birds or canaries were up 25 percent this year, thanks to higher demand and increased shipping costs for retailers.2007: Most Expensive Christmas EverFor those True Loves who prefer to do their shopping online, PNC Wealth Management calculates the cost of The Twelve Days of Christmas gifts purchased on the Web. This year, the trends identified in the traditional index are repeated in the Internet version, with overall growth of 3 percent, very close to the 3.1 percent in the traditional index. This year, the Internet index is very similar to the traditional index. For example, the price of gold is significantly higher online in 2007 compared to 2006. And, as with the traditional Christmas Price Index, bird prices are mostly even with or, in some cases, down a bit from 2006 levels. In general, Internet prices are higher than their non-Internet counterparts because of shipping costs.As part of its annual tradition, PNC Wealth Management also tabulates the True Cost of Christmas, which is the total cost of items gifted by a True Love who repeats all of the songs verses. This holiday season, very generous True Loves will pay more than ever before - $78,100 - for all 364 items, up from $75,122 in 2006. This 4 percent increase is about even with last years 3.5 percent increase.Permalink | Recent Headlines | WWFeeds.com
Electricity Supplier Offers Ebay Auction
A Connecticut electricity supplier called MXEnergy has found an unusual way to sell energy - by auctioning it on eBay.MXEnergy, one of several electricity suppliers in the states deregulated market, is offering homeowners and small businesses electricity rates that are locked in, similar to power purchases by large commercial and industrial customers.To promote its business among United Illuminatings 320,000 customers, the Stamford-based MXEnergy is auctioning off 1 megawatt of electricity to the highest bidder before Dec. 13. As of Friday afternoon, the highest of 18 bids was $132.50.MXenergy will accept the highest bid on a megawatt, or 1,000 kilowatts, of electricity and divide it by 1,000 to determine the rate at which the winner can purchase up to 10 megawatts in a year after signing up with MXenergy.Thats about how much electricity an average household uses annually, said Jeffrey Mayer, president and chief executive of MXEnergy.MXEnergy has 500,000 customers according to the Fool.com story. The eBay auction listing can be found here.Permalink | Recent Headlines | WWFeeds.com
