Category: General

B&N, Microsoft team up on Nook, college businesses

Posted on by The INO.com Team

By PETER SVENSSON
AP Technology Writer

(AP:NEW YORK) An infusion of money from Microsoft Corp. sent Barnes & Noble Inc.'s stock zooming Monday, as the software giant established a way to get back into the e-books business.

The two companies are teaming up to create a subsidiary for Barnes & Noble's e-book and college textbook businesses, with Microsoft paying $300 million for a minority stake.

Shares of Barnes & Noble jumped $10.41, or 76 percent, to $24.09 in morning trading. The opening price of $26 was a three-year high. Microsoft's stock rose 2 cents to $32.

The deal gives Barnes & Noble ammunition to fend off shareholders who have agitated for a sale of the Nook e-book business or the whole company, but the companies said Monday that they are exploring separating the subsidiary, provisionally dubbed "Newco," entirely from Barnes & Noble. That could mean a stock offering, sale or other deal.

The deal puts to rest concerns that Barnes & Noble doesn't have the capital to compete in the e-book business with market leader Amazon.com Inc. and its Kindle, said analyst David Strasser at Janney Capital. Continue reading "B&N, Microsoft team up on Nook, college businesses" →

Income Growth Outpaces Spending Growth In March

Posted on by The INO.com Team

RTTNews) - U.S. workers took home more pay in March but growth in consumer spending slowed somewhat, according to figures released Monday by the Commerce Department.

Department figures put U.S. personal incomes up 0.4 percent in March, slightly higher than the 0.3 percent growth posted for February.

That comes in slightly higher than the 0.3 percent growth predicted by most economists.

Furthermore, the February personal income figures were revised up from the 0.2 percent growth rate initially reported. Continue reading "Income Growth Outpaces Spending Growth In March" →

So Long, US Dollar

Posted on by The INO.com Team

By Marin Katusa, Casey Research

There's a major shift under way, one the US mainstream media has left largely untouched even though it will send the United States into an economic maelstrom and dramatically reduce the country's importance in the world: the demise of the US dollar as the world's reserve currency.

For decades the US dollar has been absolutely dominant in international trade, especially in the oil markets. This role has created immense demand for US dollars, and that international demand constitutes a huge part of the dollar's valuation. Not only did the global-currency role add massive value to the dollar, it also created an almost endless pool of demand for US Treasuries as countries around the world sought to maintain stores of petrodollars. The availability of all this credit, denominated in a dollar supported by nothing less than the entirety of global trade, enabled the American federal government to borrow without limit and spend with abandon. Continue reading "So Long, US Dollar" →

Poll: Has the housing market hit rock bottom?

Posted on by The INO.com Team

The National Association of Realtors reported that the number of contracts to buy homes is rising, which pushed up the stock market yesterday. Yet earlier this week the report was that home sales were down. Which leads me to this question....

Do you think the housing market finally bottomed out?

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As always we would love to hear what you have to say on the subject.

Every Success,

The INO Team

U.S. Financial System: Is It Finally Stable?

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By Elliott Wave International

Four years after we brushed up against "financial Armageddon," did you think you'd be reading this?

Federal Reserve Chairman Ben Bernanke said...banks need to have more capital at hand in order to ensure the financial system is stable. Bernanke said regulators were taking steps to force financial institutions to hold higher capital buffers...

- Reuters, April 9

It appears our financial system is still not as stable as it needs to be. But guess who relaxed the banking system's "capital buffers" in the first place?

The Fed increased the credit in the system in the 1990s by the de facto removal of reserve requirements for banks.

- Robert Prechter, Elliott Wave Theorist, November 2011

Prechter's September 2011 Theorist provides this additional insight:

In the late 1990s and mid 2000s, the loan-to-deposit ratio for U.S. banks was nearly 1.00, meaning that almost all deposits were lent out. That shortfall alone was a serious problem, because if even 5% of depositors had decided to withdraw their money, banks would have been unable to pay. Some of the banks' loans were quickly callable, but by 2006, the credit-fueled real estate boom had claimed a large percentage of outstanding loans, both inside and outside the banking system. These loans are not quickly callable. The problem was serious in 2002 and enormous in 2006. Now it has become acute, because many loans are becoming fossilized, as the market for mortgage investing has dried up while foreclosures on the "collateral" have been slowed by court actions and politics. Continue reading "U.S. Financial System: Is It Finally Stable?" →