Archive for June, 2011
Homebuilder Posts Profit, But Not from Building Houses
Homebuilder Lennar Corp. (NYSE: LEN) released its second quarter fiscal year earnings last week and beat analysts’ consensus estimate of $0.04 EPS, posting earnings of $0.07/share. Revenue of $764.5 million exceeded expectations of $643 million. How this happened is more interesting than the fact that it did perhaps. Lennar’s revenue from home sales fell 6% [...]
Greece: The Next Argentina?
About 10 years ago it appeared that Argentina was about to collapse under the combined weight of runaway inflation and unmanageable public debt. Capital was fleeing the country at near-supersonic speed as the government stubbornly maintained its fixed peg to the US dollar. Finally, the government repudiated its dollar peg, devalued its currency by about [...]
Why It Could Be Bad if Home Prices in Hong Kong Did Not Decline
According to Walter Kwok, the former chairman of the world’s largest developer (by market value), housing prices in Hong Kong have peaked and may decline up to 15% this year, Bloomberg reported. The projected decline in the Hong Kong real estate market may be due to government regulation. The People’s Bank of China (PBC) has [...]
New IMF Chief Appointment a Virtual Done Deal?
By the end of June, the International Monetary Fund (IMF) will have a new Managing Director to replace Dominique Strauss-Kahn, who was forced to resign following charges of sexual assault against a maid in a New York hotel room. It seems there is only a slim chance that he will be succeeded by anyone other [...]
The Next Step for Greece (and the Euro)
Now that Greek Prime Minister George Papandreou has won a resounding vote of confidence in the country’s parliament, he can turn his attention to a few really difficult issues. In case you missed the irony in that sentence, Papandreou received 155 supporting votes, exactly 5 more than one-half of total votes cast. All 155 votes [...]
Amazon, Texas Working on a Sales Tax Deal
Last September the state of Texas sent Amazon.com (NASDAQ: AMZN) a bill for $269 million in uncollected sales taxes for the years 2005-2009. Because the on-line retailer operated a warehouse and shipping facility in Texas, the state’s position is that the company is required to collect sales tax. Amazon refused and retaliated by threatening to [...]
IMF Memo to Spain: Watch Your Step
The International Monetary Fund (IMF) has issued a statement on the reform measures implemented by Spain as that country grapples with its sovereign debt issues. While this is not enough to push the situation in Greece out of the headlines quite yet, it is worth a brief look. The statement reveals both the progress Spain [...]
Popular Sentiment Putting European Financial System At Risk
On Monday, the German government flip-flopped once again, vowing to delay extending additional funds to Greece unless the Greek government enacts stringent austerity measures designed to curtail spending in the Mediterranean nation. Ultimately, Germany might simply be engaged in a game of political chicken. If Greece is forced to withdraw from the euro and effectively default on [...]
Is the White House Right to Praise Rebounding of Foreign Direct Investment?
According to a report released by the White House Council of Economic Advisers on Monday, foreign direct investment in the United States increased by 49% in 2010. As reported by Bloomberg, President Obama praised the increase in an e-mailed statement. Obama explained that increased foreign investment should help to accelerate economic recovery in the United [...]
Euro Tracking Hopes for Greece
Over the June 18-19 weekend, eurozone finance ministers were expected to reach an agreement that would have allowed the release of another tranche of about $17 billion in bailout funds for Greece. In what has become typical behavior, the ministers decided instead to delay the release of the funds until Greece accepts a controversial package [...]
