It's Always Funny When the Wives Get Involved - BofA Edition

I'll be back to posting regularly after the holidays. For now, enjoy this juicy little tidbit about Dick Fuld getting punked by Donna Lewis (wife to BofA CEO Ken Lewis).

From Clusterstock.com

Our favorite part of The Journal's big demise of Lehman story? Right at the beginning, the part about the wife of Bank of America CEO Ken Lewis telling Dick Fuld to stop calling their house:

Desperate to avoid steering his 25,000-person company into bankruptcy proceedings, Mr. Fuld dialed the Charlotte, N.C., home of Bank of America Chairman Kenneth D. Lewis. His calls so far that weekend had gone unreturned. This time, Mr. Lewis's wife, Donna, again picked up, and told the boss of Lehman Brothers: If Mr. Lewis wanted to call back, he would call back.

Mr. Fuld paused, then apologized for bothering her. "I am so sorry," he said.

You know Ken was standing right next to her saying: "You answer it, tell him I'm not here!" And which one of them leaked this tidbit?

My comment: Is this 2008 Banker of the Year behavior? CEO not returning another 's call, then having your wife field and deliver your non-response messages? Well, maybe I spoke too soon - less a commentary on Ken and more on Donna? (see USA Today write-up on Donna Lewis's past life as a BofA executive secretary.

In Honor of My Parents - A Big Happy Anniversary

To my parents, currently residing abroad, we give you a big hug and wish you a happy anniversary.

Duke Energy's Rogers Being Considered for Obama Administration - Updated

Per the Washington Post, Is Charlotte-based CEO of Duke Energy, Jim Rogers joining the Obama administration?

The Obama transition team, moving along smartly to fill Cabinet posts, is planning to trot out nominees as early as next week for three jobs much watched by enviros: the secretaries of energy and the interior and the administrator of the Environmental Protection Agency.

A cast of luminaries have been mentioned, including Duke Energy executive Jim Rogers, former Energy Department official Dan Reicher, former top Clinton White House environmental aide Kathleen McGinty, FedEx chairman and Republican backer Fred Smith, New Jersey utility chief executive Ralph Izzo, and Rep. Jay Inslee (D-Wash.).

Update: Per MSNBC, Obama will name Steven Chu his choice for Energy Secretary, Lisa Jackson for EPA administrator and Carol Browner as energy "czar" reporting to the President.It is unclear whether the Browner position is cabinet level.

Rogers gets nothing.

Government Fans Flames of BofA Controversies - Updated

Bank of America is today contending with two separate controversies And wrestling with the state of Illinois and the federal government about each of these issues. It seems that these Governments are now in the business of advising BofA on its credit risk business and its executive compensation plan:

1. Illinois Governor Suspends Business With Bank Of America pending resolution of the Republic Windows & Doors.

Illinois Governor Rod Blagojevich announced Monday that he is asking all Illinois government agencies to suspend business with Bank of America. Blagojevich contended that Bank Of America received a multi-billion dollar bailout from the government and should accordingly restore credit to the Republic Windows & Doors company in Chicago

Excuse me, but what does the Governor know about the terms this loan and the credit worthiness of this business? How did BofA become the villain in this employment problem? Misdirection by Governor, as the employees and union members beef should be with Republic, no?

2. Sen Reid Urges Merrill To Reject CEO Thain $10 Million Bonus Request .

Senate Majority Leader Harry Reid, D-Nev., urged Merrill Lynch (MER) to reject its chief executive John Thain's request for a $10 million bonus at a time when the bank is benefiting from millions of dollars of taxpayer money through the financial rescue package. The Wall Street Journal reported Monday that Thain requested that Merrill's board pay him the bonus, but that board members are resisting doing so.

I'm happy the Board is fighting Thain's compensation - that's where the battle and discussion should be; I hope they stay strong and deny Thain his millions. Why Reid has inserted himself is pure political posturing.

How is this happening? Nobody could have predicted that politicians would politicize the bailout and all issues emanating from it. Nobody. (insert sarcastic snicker!)

Update: CNBC: John Thain Will Not Receive Bonus This Year

Econobloggers 1, Mainstream Media 0

As someone who's benefited from the knowledge and writing on the econoblogs listed in the Boston Globe article "So You Want to Save the Economy?," I feel compelled to acknowledge them here with a shout out.

Many of these bloggers are on my Blog Roll and these "dirty, hippie bloggers" have been collectively spot-on in forecasting the economic collapse that is unfolding. These economic experts also came together with one voice to say that Paulson had generated a stinker of an expensive and ultimately, ineffective TARP bailout plan.

This is in sharp contrast to many monetary policy makers and economists in the mainstream media, who both were completely surprised and caught unaware by the current financial trainwreck, and then pushed and promoted TARP as our best hope for avoiding a financial downturn.

Who was right?

Lastly, I call attention to reports of the bankruptcies and worsening balance-sheet conditions at many newsprint and traditional media companies (see New York Times, Tribune Company financial woes). There are many reasons for their financial troubles, to which I'd include diluted, dumbed-down news analysis and a general slippage in editorial standards and news coverage.

In the evolution of news, more readers are plugging into Internet(including blogs), traditional media is suffering and, print media will become a shadow of its former self.

This Year, The Haves Should Only Gift the Have Nots

This Christmas season will be, economically speaking, one of the toughest for many Americans. It is an opportunity for us to reject the orgy of materialism (and distill seasonal giving down to its essence. That is, to promote peace and good will among our neighbors, most importantly those in the most need.

From Huffington Post's Black Friday At Wal-Mart: The Cost Of Crazed Consumerism

Here are some experiential gifts you might consider giving this holiday:

1) Give an authentic acknowledgment to the people you love.
2) Look them in the eyes and tell them who they are for you.
3) Open up communication with someone with whom you've had a misunderstanding.
4) Apologize to someone you've unfairly judged.
5) Extend kindness to a stranger or offer support to someone and expect nothing in return.

This, I believe is the true spirit of not only this time, but of these times. As never before, we are called to reconnect with what matters. Let this holiday season be a beckoning for you to summon up the "greater angels of your nature," to come forward with the gift of your authentic presence and offer yourself as the priceless gift you are. Presence is a "being" thing. No credit cards or cash required.

2008 Holiday Giving Guide Database (courtesy of Charlotte Observer)

BofA Pink Slips - REPOST

REPOST - Did I say 10,000? It looks like more that 35,000 jobs to be cut (over three years)!

Depressing news from Bloomberg, "BofA To Cut 10,000 Investment Banking Jobs"

Bank of America can be expected to cut at least 10,000 investment banking jobs as it moves to absorb Merrill Lynch, sources have told CNBC. The layoffs will start before the end of the year and possibly as soon as this week.

This will probably impact BofA/Merrill Lynch New York offices more so than Charlotte headquarters. Still.....

Uh-oh...Is Bank of America Getting Cold Feet?

From the tabloid New York Post, I bring you, without comment, Merrill Flinch.

The Ballad of Wachovia - R.I.P.

There once was a man name of Ken
For banking he had quite a yen
Big talker he was
And seldom did pause
To think prior to sharing his spin

He gobbled up firms right and left
Employees from those were bereft
Their jobs were all gone
Possessions they pawned
And Ken told them "Sorry you're miffed"

Ken's star was still rising so fast
And Wachovia's stock unsurpassed
Near 60 it rose
In awe were his foes
But then he acquired Golden West

At top of the bubble he bought
Dissenting opinion he fought
The deal came to past
The stock fell so fast
And havoc on us Ken did wrought

The board finally gave Ken the boot
And Lanty would say "Well now shoot"
"Things ain't all that bad"
"I'll find us a lad"
"To turn things around"
... What a hoot!

So Steel took the offer to come
And told us "Hey don't look so glum"
"I'm from Goldman Sachs"
"Know Treasury's hacks"
"Just watch as I pull out a plum!"

Yet share price continued to fall
And Steel brazened unforeseen gall
On TV Steel went
To Cramer did vent
And said "We can manage it all"

Two weeks later all became clear
As hope quickly turned into fear
Feds said "Sell or seize"
"We ain't saying please"
While Steel played the role of King Lear*

Amidst somber tolling of bells
Steel first sold to C, then to Wells
Shareholders perplexed
Employees quite vexed
Above all were heard screams and yells

We ask, "How can all of this be"
"Misled by Ken, Steel and Lanty"
The deal seems all Donne
This ain't been much fun
We now know the bell tolls for thee**

by blogger Gus with apologies to Wm. Shakespeare and John Donne

* Meantime we shall express our darker purpose.Give me the map there. Know that we have dividedIn three our kingdom: and 'tis our fast intentTo shake all cares and business from our age;Conferring them on younger strengths, while weUnburdened crawl toward death. ... "King Lear" (Act I, Sc I)

**Therefore, send not to know For whom the bell tolls, It tolls for thee. ... "For Whom the Bell Tolls"

Congress to Probe Former-Goldman, Former-Treasury,Former -Wachovia Executive Steel?

Is Robert Steel feeling any heat? Perhaps, sez The Financial Times in "Call for Probe Into Ex-Goldman Executives."

Chuck Grassley, the most senior Republican on the Senate finance committee, asked Eric Thorson, inspector-general of the Treasury, to investigate the "independence" of several Treasury officials who formerly worked at Goldman Sachs and serve as advisers to Treasury secretary Hank Paulson, the former chief executive of the Wall Street bank. (snip)

Mr Grassley singled out Robert Steel, a former Goldman official who worked under Mr Paulson at the Treasury before he became chief executive of Wachovia. (my emphasis, snip)

Mr Grassley is specifically concerned with a change in the tax code the Treasury initiated in late September that saved some institutions tens of billions of dollars and paved the way for Wells Fargo's acquisition of Wachovia.

See my 9/30 post, "Robert Steel: Iron Man or 'Irony Man'"

Tabloid Thursday - Charlotte Gone Wild

Local scandals made for the national tabloids. Charlottetowne, you're all growed up.

• Teachers Disciplined for Facebook Postings (Charlotte Observer)
• Southpark Madam: Saxon's Powerful Clients (MSNBC multi-part expose)

Charlotte Playas

Charlotte magazine publishes its "Power 50" list of this year's Most Influential Charlotteans. No surprise - Ken Lewis is king of the heap.

Take the playa quiz to see how you rank.

Obama Declared Unofficial Winner in NC!

Is it over? Is it really, really, over? "Almost," says the Raleigh News & Observer:

Democrat Barack Obama is the unofficial winner in North Carolina, but the victory over Sen. John McCain won't be sealed until provisional ballots are counted and certified next month.

Unofficial returns show Obama ahead by 13,746 votes.

"Our law allows us to say who the unofficial winner is," Gary Bartlett [NC State Board of Elections] said, "but you know we have a formal process in which we audit records." The county canvasses are Nov. 14, and the state is scheduled to certify the results Dec. 1.

Thank You Bush for Giving Us Obama

If we didn't have Bush, we migh not have gotten Obama. I loved this snarky thank you note from blogger marky367's diary. :: ::

Dear Bush Administration,

I received your gift of President Obama yesterday, and LOVE IT!

Now don't act shy.

You've been too modest in the past. Why, I remember when that Valerie Plame thing showed up on the front steps one day. You were all like, "Where did that come from?"

But I knew it was you!

Not this time. You're going to take a turn in the spotlight even if I have to shackle your legs and frog march you out there! ;-)

Because I want everyone to know that we owe the outcome of this election entirely to you.

You see, some people would say this election proves that America has changed. That we're ready to acknowledge that complicated problems require nuanced solutions. That courage is trumping fear. That we're finally stepping into a post-racial future.

Bzzzzt! Wrong!

What's remarkable about this election is the mind-boggling amount of coercion, brow-beating, and finally the all-encompassing catastrophe that it took for America to even consider changing course!

What administration but yours could have kept its eyes on the prize and made it happen? The storm warnings of your first term elicited yawns. The rising waters of the second term, shrugs. And even in the week before the election, polls showed that 12% of the bloated corpses bobbing on the flood you caused were still not sure how to vote!

It's not for lack of effort on your part. You've been trying to give this gift since the moment you came to power. You tortured people, denied habeas corpus, committed election fraud, wallowed in corruption, and spied on your own citizens. You wasted hundreds of billions on a pointless war. You bungled attempts to get Osama Bin Laden. You sat on your hands while an entire city was washed away.

Any ONE of these things ought to have been sufficient to assure the election of ten Barack Obamas. And yet, at the end of the primary season, he was running no better than even with McCain. A candidate barely palatable to his own party!

You must have been wondering, "Christ! What is this going to take?!" I know I was.

A better administration would have thrown in the towel. But you didn't give up!

So there were only two options left: to have the House Republican caucus drink the blood of babies on prime time national television, or to hurl the country into a depression. Personally, I think the former option would have shown a lot of style.

But that's quibbling.

So, sure, special gratitude has to go out to all the politically-appointed heads of regulatory agencies who were supposed to be patrolling the financial sector, but instead, with a knowing wink, kept a protective vigil at the front door while a circle jerk of hedge fund CEO's did belly shots from the navels of trashy mortgage derivatives.

You know who you are. I love you guys.

But ultimately, this was a team effort. And while the contributors were too numerous to mention here, I've got to give a special shout out to the committed few that did more than just break our laws and betray our trust. They made that extra effort required to rub America's face in it, just to be sure we'd notice.

To Larry Craig, David Vitter and Mark Foley. You knew that anybody can get themselves busted with their pants down. So you were sure to be moralizing, holier-than-thou crusaders right up until the moment they snapped the cuffs on you. Way to dazzle 'em with the depravity, then send 'em to the canvas with the hypocrisy!

Take a bow!

To Karl Rove and his corps of political assassins. You could have just played dirty when the score was close. But you went for the groin again and again and again--cold-cocking Don Siegelman in Alabama, canning U.S. attorneys, outing covert operatives--even when you had the game in hand! Talk about dedication!

Take a bow!

To Dick Cheney--there just are no words. You are the ultimate bureaucratic ninja. You could have quietly dismantled our democracy and no one would have even noticed until the unopened mail at the Rayburn House Office Building started piling up. But you played out of your head for eight straight years! It was like you were everywhere at the same time! The overreaching, the surliness, the swagger. You lied us into a war. You tortured innocents. You crapped on the Constitution. And then, like some kind of geriatric James Dean, you looked us in the eye and dared us to do anything about it.

Take a bow.

And last but not least, to you George. For exhausting America's seemingly-limitless reserve of cowardice by pressing the fear button over and over, so that when John McCain went to that well to warn of a black man named Hussein, the bucket came up empty.

For valuing intuition over intellect. We watched you thrust your arm into one political wood chipper after another. And each time you'd regard your mangled digits with bewilderment, and then commit the same boneheaded mistake again! What less-numbing display could have driven the great unwashed into the arms of some brainiac college professor to be drearily lectured on economics?

And finally, thanks for exhorting us to aspire only to our basest instincts. For urging us to shop for trinkets, to suspect our neighbors, to get all we could get while the gettin' was good. By offering not a scrap to quell our pangs for more wholesome fare, you ensured that an ethereal menu of hope, change and unity would be welcomed as the starving welcome biscuits and gravy. When I think about the effort you made. The commitment. I just...

I promised myself I wouldn't cry. I will not cry. ...

But no sir! I can't wait for Barack Obama to reverse every policy and repeal every law you've supported in the last eight years. And each time he does something smart, something competent, something Constitutional--or even when he commits mere misdemeanors in the places where the felonies used to go--I will think of you. And smile.

There may come a time when the destruction you've caused ill seem no more than a bad dream. When agencies are run by skilled professionals rather than political hacks. When other countries laugh with us, not at us. And when, with the wiser eyes of a Jimmy Stewart saved by an angel, we delight in the modest charms of our old, exasperating, imperfect, break-down prone jalopy of a government as it chugs unsteadily into the future.

Indeed, there may come a time when Barack Obama has erased virtually every trace of the mess you've made.

But there's one thing he'll never erase: my gratitude.

Sincerely,
Me

Obama Wins and U.S. Rejoins the World; NC Counts Votes

Obama wins an historic U.S. Presidential election. See today's newspaper front pages - US and Worldwide Edition.

As of 11 am, Nov. 5, results from North Carolina are still too close to call.

Final PPP Poll - Photo Finish Expected in NC

From Political Wire, PPP Poll - Photo Finish Expected in North Carolina

The final Public Policy Polling survey in North Carolina barely gives the lead to Sen. Barack Obama as he edges Sen. John McCain by one point, 50% to 49%.

Key finding: "Barack Obama's chances in North Carolina on Tuesday really could depend on the weather. PPP projects that he racked up a lead of a little over 250,000 voters during early voting. He led 55-45 among those who said they had already voted in our poll, and a little over 2.5 million North Carolinians have already cast their ballots."

In the U.S. Senate race, Kay Hagan (D) leads Sen. Elizabeth Dole (R-NC), 51% to 44%.

My comment - I expected Obama's early voting lead margin to be wider than 250,000. Hmmm.

North Carolina Extends Early Voting

From the New York Times, "North Carolina Extends Early Voting."

The North Carolina Board of Elections today announced that it would extend early voting hours on Saturday, the last day people can cast ballots in the state before Nov. 4.
The emergency decision affects “one-stop” registration and voting sites in the state’s 100 counties, which have experienced long lines since opening on Oct. 16. The sites can now stay open four hours later, until 5 p.m., on Saturday.According to The Associated Press, more than 1.7 million people, just under a third of the state’s registered voters, had cast ballots by Wednesday evening in the surprise swing state.

The North Carolina decision comes as states around the country have experienced heavy early turnout, with Gov. Charlie Crist of Florida extending early voting hours from eight hours a day to 12 on Tuesday.

BofA Doesn't Explode; CEO Ken Lewis Named Banker of the Year

Marketwatch reports, "American Banker to Honor Kenneth D. Lewis With 2008 Banker of the Year Award."

In the past two years, Lewis seized strategic opportunities created when financial services rivals stumbled, and in the process expanded his company's reach in two key financial services businesses. He turned the company into a mortgage powerhouse with the acquisition of Countrywide Financial Corp. and followed with a deal for Merrill Lynch that establishes B of A as a leader in wealth management.

Notes Clusterstock:

Apparently you can still be named “Banker of the Year” by American Banker even if the share price of the bank you run is down 50% for the year. That might not be entirely fair. Watching half your market capitalization vanish is better than having your whole company vanish. Lewis is certainly no Jimmy Cayne, Dick Fuld or John Thain. (Although, in fairness to those guys, they didn't have the giant depositor base, years of access to the discount window and FDIC protections that Ken enjoyed).

Three cheers for Ken! He kept Bank of America alive! It only took $25 billion of new capital from taxpayers and God knows what other favors Chris Dodd worked into the bailout legislation for you.

Socialist Welfare Queens!

Click on the above picture to view the twenty five banks currently on the Treasury dole. I wonder how Joe the Plumber likes this wealth redistribution.

A NASCAR Endorsement For Obama

NASCAR icon Junior Johnson endorses Barack Obama. Junior Johnson is described as the first NASCAR superstar, a man from the western Piedmont who actually started out as a moonshine runner. His folksy endorsement letter follows:

Every day I talk to someone else who's never voted for a Democrat, but now they're voting for Barack Obama. They realize that Barack understands what we're going through here in North Carolina. And they're ready for change.

So I've made up my mind, and I'm ready to get involved. I know that I could never have won a race without my pit crew, and I know Barack can't win this one without us.

Can you sign up to volunteer this last crucial week?

When I talk to folks about why I support Barack, I just tell it like I see it.

There's been a lot thrown at him this election, and he's stayed calm, positive, and focused. I know a little something about how important it is to stay cool under pressure.And with all the dangers in our world today, that's the kind of rock-solid leadership our country needs.

These days, I run a small country ham and pork skins business. Barack Obama will fight for a fair economy where small businesses like mine have the freedom to grow, and he'll defend the Second Amendment to protect the hunter's way of life.

But the most important reasons I'm speaking out for Barack Obama are named Robert and Meredith, my two children. My wife Lisa and I talked it over, and honestly, we know in our gut that their future is more secure if Barack Obama is president.

At the end of the day, there's just nothing more important than that.

That's why I'm going to talk to my neighbors this week, and I'm asking you to do the same. This election in North Carolina is going to be one of the closest ever, and we all need to lend a hand. Join me by volunteering this week:
http://my.barackobama.com/...

I've been in a lot of races in my life. But this may be the most important one of all. So let's all get in gear and win it together.

Yours,
Junior Johnson

P.S. -- I know what it means to run an aggressive race, but I also know what it means to compete with integrity. Have you gotten one of these pre-recorded calls that are flooding our state smearing Barack Obama's character and questioning his patriotism? That's crossing the line, and North Carolinians deserve better. Help fight back by canvassing this week to tell your neighbors the truth about Barack.

Being Rich While Living Poor

We're all fixated on the financial markets these days. By and large, we're all feeling poorer, or at least I am, as I watch my investment accounts take a beating. With this in mind, I'm excerpting from one of my favorite lifestyle/culture websites, Of Two Minds. This featured website's "food for thought" is free and it's your option to take it or leave it.

To get through the upcoming economic hard times, Charles Hugh Smith's blog encourages us to:

aspire to the inner wealth of charity, forgiveness, empathy, self-acceptance, self-reliance, humor and a healthy humility about wisdom and how much remains to be learned in life. Regrettably for the Standard Model of Marketing, all of these are hopelessly and irrevocably free. (snip) I know it runs counter to everything we are supposed to cherish about the "American Lifestyle," but it seems to me that living poor has all sorts of advantages.

To list but a few:

1. Smaller cars are easier to park and cheaper to own/drive. A Toyota or Honda will last for 15 or 20 years with routine maintenance, while the luxury brands are rusting in the junkyard or requiring thousands of dollars in repairs.

2. Cooking real food is cheaper, tastes better and is healthier for you by far.

3. Teaching kids self-reliance and thriftiness (basically the same thing) cures dysfunctional dependence; cancel the maid service, stop buying sports drinks as everyday treats, etc.

4. Having a cellphone glued to your ear does not make you a bigshot. 80% of all "communication" is distraction. Creativity and innovation are not nourished by being overwired and distracted.

5. Being a renter is much easier than owning a house. When something breaks, you call the landlord or porperty management company. Once you buy a house with a mortgage, it's costly to align the mortgage to market forces; it's fixed unless rates fall and even then you have to pay thousands in refinancing fees. Rents are open to market forces so you can negotiate lower rents or move to a cheaper place without losing 10% of your capital (selling a house costs 6% realtor fees plus closing costs).

6. Second-hand stuff is treated as tainted by a "buy new" middle-class, but used is smarter. The first owner took a 90% loss, or a 50% loss for a recent auto. The second owner gets all the benefits with very little loss of intrinsic value.

7. Not buying anything new is best for the planet. Even a "green" Prius uses hundreds of gallons of oil to manufacture, extract the iron, make the steel and plastic, etc. It takes more oil to manufacture a Prius than the vehicle will ever consume. If you want a Prius, buy a used one.

8. The Web is mostly free (this site included). That makes it the greatest bargain of all time. Yes, a monthly access fee is required but these are less than cellphone plans. Or you can log onto free public wi-fi networks.

9. The real world trumps electronic simulacrums, which inevitably leave users with a strange inner hollowness and ennui. It's free to go outside, free to learn new things off the Web, free to do situps on your own floor, etc.

10. "New" is oversold. We seek novelty but novelty does not have to be purchased.

11. Drawing identity from Consumerism (in any guise) is true inner poverty. Focusing on being a better parent, smarter investor, mentoring younger colleagues, etc. are all free; they build an authentic identity that has no need for superficial externals for verification.

12. What you consciously give up as not in your own best self-interest you no longer miss: sodas, chips, ridiculously overpriced football games, ice cream, fast food, cable TV, etc. etc.

In the near future, we'll be reading more and more advice like this. While Smith takes the "living poor" philosophy further than I would, I believe we all should periodically examine our lifestyle priorities and choices. Our ability to be happy in difficult circumstances hinges on being flexible and adjusting to ever-changing realities. Now is such a time to examine and perhaps recalibrate our priorities and expectations.

Nothing Could Be Finer Than To Be In Carolina

This morning I opened my Charlotte Observer to see its editorial board give the nod to Barack Obama for President.

In an era that begs for a return to the standards of decency and respect for the rule of law that made America great, Obama offers thoughtful proposals for a rational way to respond to the nation's needs. The Observer enthusiastically endorses Barack Obama for president.

Note: The Observer also endorses Kay Hagan (D) for U.S. Senate, Pat McCrory (R) for North Carolina Governor. For what it's worth, I concur.

As an added treat, I've also included The Nation's piece by Bob Moser that I believe sums up North Carolina this election - Obamalina. Moser, bringing the election full-cycle, writes:

The night of his primary triumph in May, Obama was all swole with joy and uplift--and in full sales mode. After calling North Carolina "a swing state, a state where we will compete to win if I am the...nominee for president," Obama raised the roof with his big preacherly finish: "In this country, justice can be won against the greatest odds. Hope can find its way back from the darkest corners.... We answer with one voice, 'Yes we can.' North Carolina and America...don't ever forget that this campaign is about you. It's about your hopes, it's about your dreams, it's about your struggles, it's about your aspirations."

Duke Energy to Reduce Investment in Alternative Energy

From the Charlotte Observer, "Duke Halves Its $100 Million Plan for Solar Panels."

Duke Energy has cut in half its $100 million plan to place solar-electric panels on hundreds of N.C. rooftops after consumer advocates for the state Utilities Commission called the proposal too aggressive and expensive.

Two takeaways from this move: 1) traditional energy (oil/gas) prices are going to continue to fall; and 2) cash (funding for alternative energy) must be conserved. Both of these factors obviate the need for aggressively funding solar-electric energy. More fall-out from the rapidly contracting economy.

Closing the Books on Wachovia

From Clusterstock:

There's a reason the government put 'em down. Wachovia has just announced a $23.9 billion quarterly loss -- $18.8 billion of which is the impairment of goodwill. That represents the end of its $25 billion acquisition of Golden West, back in 2006. Deals don't get much worse than that. Excluding Goodwill and various merger expenses, it only lost $4.4 billion.

Wachovia - RIP. As a recovering Wachovia stalker, I suppose I'll now have to focus on Wells and BofA.

Be Happy!

Yes there's lots of anxiety and turmoil these days, from the elections to the financial markets. But Foresight, British think-tank report, covered in The Times, lists few simple ways to stay sane and be happy (and none of them involve money!):

Steps to happiness

Connect
Developing relationships with family, friends, colleagues and neighbours will enrich your life and bring you support

Be active
Sports, hobbies such as gardening or dancing, or just a daily stroll will make you feel good and maintain mobility and fitness

Be curious
Noting the beauty of everyday moments as well as the unusual and reflecting on them helps you to appreciate what matters to you

Learn
Fixing a bike, learning an instrument, cooking – the challenge and satisfaction brings fun and confidence

Give
Helping friends and strangers links your happiness to a wider community and is very rewarding.

Now, add those five things to your daily to-do list.

More Evidence of NC As Election Battleground

A new SurveyUSA poll in North Carolina finds the state deadlocked with Sen. Barack Obama and Sen. John McCain each getting 47% support.Compared to an identical poll just two weeks ago: McCain is down 2 points, Obama is up 1. Among those who have already voted, Obama leads 59% to 36%.

Interestingly, the races for U.S. Senate and Governor are also dead heats.

New Tarheel Poll

A new PPP poll for the Tarheel state! The numbers are:
Obama 51 (49)
McCain 44 (46)

Hagan 49
Dole 42

No report on the McCrory vs. Purdue race.

NC - From Election Battleground State to Potential Obama "Closer" UPDATED

At The Field, Al Giordano outlines why North Carolina may be "The Closer" for Barack Obama on Election Night.

It's in Greater Charlotte and Piedmont where the votes are measurably switching from Bush '04 to Obama '08: Charlotte is home to the Bank of America and the carcass of Wachovia Bank (just bought out by Wells Fargo, a casualty the current economic crisis), plus 23 more of the Fortune 500 companies. It is second to New York as a financial capital.

The same deep worry that today afflicts financial professionals in Manhattan hangs heavily not only over Charlotte and its suburbs, but also Winston-Salem, where the old Wachovia Bank building shadowed surprisingly empty streets on a random weekday lunch hour earlier this week. (Emphasis mine)

In his piece, Giordano observes, "Hugh McColl Jr., former CEO of Bank of America, penned a column last week in the Charlotte Observer .

In 49 years of living in Charlotte, I've seldom offered my opinion in writing and never submitted a piece such as this. The condition of our country compels me. The economic disarray threatening our community and nation poses critical challenges but also presents opportunity. We can observe the presidential candidates in the crucible of crisis.

Only one of them demonstrates the needed intellect, fortitude and temperament. That is why I have decided to publicly support Barack Obama.

Hugh McColl's whole piece is well worth reading and, in Charlotte, is bigger and more important than any media or political endorsement. Giordano concludes his analysis by noting:

This isn't just a political campaign. It's a steamroller. This is why North Carolina really is in play. And the excitement in this state - from West to East - is the highest and the hungriest among the five states we visited in the past two weeks.

In other words, North Carolina - if all these great works come to fruition - could become, early on Election Night, the closer. Because if Obama wins here, it means he probably just won Virginia, too, and the Electoral College math then becomes impossible for McCain to overcome anywhere else that's still in play.

It's exciting to contemplate that this presidential race may be determined here in North Carolina and very possibly even in Charlotte itself. No one knows Charlotte like Hugh McColl. He seems to sense the importance of something happening here, do you?

Updated 10/13 - No link yet, but Dean Smith, legendary UNC basketball coach, has endorsed Obama.

Wachovia Still Lending...to the Republicans

As Wachovia awaits the verdict on who its new owner(s) will be, we learn that they've extended credit to the Republican Party. Per Roll Call:

The National Republican Congressional Committee, trailing its Democratic counterpart considerably in cash on hand, has secured an $8 million loan to
spend on House races during the last few weeks of the campaign, according to sources. The NRCC reported $14.4 million in cash on hand as of Aug. 31, compared to $54 million in the bank for the Democratic Congressional Campaign Committee. As it did last cycle, the NRCC is procuring its loan from Wachovia Bank, sources confirmed.

The NRCC's $8 million loan would appear to push the committee's cash on hand over the $20 million mark, depending on how much money it raised and spent in September. Last month's numbers for both the NRCC and DCCC are not due to be publicized until later this month.

Dailykos has extensive commentary on this (see here).

My commentary is shorter and more wistful: If Wachovia had been more careful about its borrowers' creditworthiness and more correctly assessed loan risks, perhaps they wouldn't be where they are today. Yes, NRCC can be included in the category of credit deadbeats as they defaulted on their last Wachovia loan.

McCrory + Palin = Win in Charlotte?

Per the News & Observer: Palin Stops for Pizza, Debate.

Palin's visit came as recent national and North Carolina polls have indicated that the Democratic ticket of Obama and Sen. Joe Biden is surging as the country reels from one economic blow after another.

Obama has targeted North Carolina, which has typically gone for Republicans
in recent presidential elections, as a potential swing state this year. Obama's
campaign said Tuesday night that Palin's visit was yet another indication that
N.C. voters could have an impact on the outcome.

Back in August, I thought the Tar Heel State would become a presidential battleground state (see here). Winning in Charlotte is both Obama's and McCrory's ticket to victory in North Carolina. Can they both win here? Maybe. Sarah Palin is a lightening rod. Will Charlotte's moderates embrace or reject the McCrory/Palin connection? It's too soon to tell.

McCrory currently leads by +1 against Purdue in the governor's race; Obama/Biden is currently polling +6 over McCain/Palin in the latest North Carolina PPP poll.

The Fate of Wachovia at (High) Noon Today?

Per the Charlotte Observer: Wachovia Up In Air; Split-up Feared.

And for the sake of Wachovia, I don't like seeing Robert Steel so glum. Guess we'll get the verdict on Wachovia at 12 noon today.

Trainwreck BofA Offering

From Bloomberg:

Bank of America Corp. will cut its dividend by 50 percent and plans to sell $10 billion in common shares after third-quarter profit fell 68 percent. The stock fell in late trading. Bank of America profit dropped to $1.18 billion, or 15 cents a share, in the quarter ended Sept. 30, from $3.7 billion, or 82 cents, in the same period last year, the Charlotte, North Carolina-based company said in a statement.
``These are the most difficult times for financial institutions that I have experienced in my 39 years in banking,'' Chief Executive Officer Kenneth Lewis said in the statement. ``It is prudent to raise capital to very substantial levels in this uncertain environment.'' Bank of America dropped 7.2 percent to $29.91 as of 4:27 p.m. in extended trading. During the regular session, the bank dropped 6.6 percent. Lewis said "recessionary conditions'' and the outlook for an even weaker economy will drive up credit losses and depress earnings.


My comment: Way to attract investors: cut dividends AND dilute stocks! Is it a surprise to anyone that Bank of America Offering is a Calamity ?

Rewriting Wachovia's Ending

Wachovia to merge with Wells Fargo; Citi left in the dust.

This is a huge surprise, but this deal makes much more sense than the deal with Citigroup. This also takes the FDIC off the hook and is an improved outcome for Wachovia shareholders.

From Dealbreaker.com: Wachargo It Is!

Robert Steel - "Iron Man" or Irony Man

Now that Wachovia's over, all we're left with is the shouting. And shouting about Robert Steel has begun, here from Cramer: Wall of Shame: Wachovia CEO Bob Steel and IHT's What Goes Before A Fall? On Wall Street, Reassurance.

I remember when the Charlotte Observer came out with lots of positive writeups of Bob Steel, (former) CEO of (former) Wachovia. This was my favorite hyperbole: Experienced, calming and in control, he's ‘Iron Man'

Have Wachovians found their hero? Many are worried, but they're not panicking, say my peeps who peep at The Jukebox Building. The main reason? Bob “Iron Man” Steel, is a “very experienced, calming and in-control force during a rocky time” says an insider. Iron Man held a reassuring call with senior leaders Tuesday, I'm told. But can his mettle address the leaden stock? Meanwhile, many wonder about their long-lost “kin.” What is Mr. Thompson up to?

I'd been skeptical of Steel as a savior simply because I wasn't convinced Wachovia could have been saved as a stand-alone bank by the time he'd arrived on the scene (even housewives can do some research). Events were too far gone. And he didn't have the makings of a hero to me; in fact he seemed quite slippery. See here and here.

At the advice of a reader, I probed a little more into Steel's past career, as this was never really properly explored by our Charlotte media -- mentioned yes, explored no. Here's what I found.

The Path to Wachovia: Let's Go to the Videotape

Steel's job as the Under Secretary for Domestic Finance at the Department of the Treasury was to report to, advise, and assist the Secretary of the Treasury and the Deputy Secretary of the Treasury on the issues of domestic finance, fiscal policy, fiscal operations, government assets, government liabilities, and other related economic and fiscal matters.

How'd he do: Here are his comments on his decision to not intervene in the monoline insurance capital crisis:

It's a ''private market-oriented situation,'' he said, referring to attempts by banks to work out plans to capitalize companies such as Ambac Financial Group Inc. that insure municipal and asset-backed bonds.

My comment: Oops!

I love this one too: “private pools of capital—which include venture capital, private equity, and hedge funds—have helped make us the world’s leading financial innovator.” The creativity, innovation and entrepreneurship that our regulatory system allows private pools of capital, have kept our capital markets the most competitive in the world, and in turn has created new jobs and opportunities, helped new businesses begin and existing businesses expand.

My comment: No regulation for dark pools of capital is great! Oops again!

Of course, when Steel was at the Treasury, he was also the chairman of the Board at Duke University. The Washington Post contended in Treasury Undersecretary's Dual Roles Raise Questions that it was ethically-challenging to hold these these two posts simultaneously.

(My comment - Conflict of interest...hmmm!?)

The Goldman Years: Batman and Robin Time

And then there's his time as a legendary executive at Goldman Sachs which got him into Treasury in the first place. At Goldman, he was was a Vice Chairman and a "Capital Markets Guy" responsible for the firm's capital markets and extensively involved in privatization and capital raising efforts. It is here of course, where he met Hank Paulson and they became lasting buddies -- they really were called "Batman and Robin."

Conclusion

I don't see a legacy of a proactive and insightful financial leader. I do see very connected insider who's had his fingerprints all over some of the biggest US financial problems -- many unresolved and festering still. I'm not blaming it all on him, but come on, he was just in Treasury's capital markets epicenter, charged with creating the Super SIV (it failed) and an enhanced regulatory structure for Fannie and Freddie Mac (R.I.P.). My comment: Triple and Quadruple Oops!

I lay this all out as I read today in our Observer, "Ex-CEO At Fault for Bank's Fate." Ken Thompson is thrown under the bus. He put Wachovia on the national map, but did make the grave error in purchasing Golden West and thus sealed the eventual end of Wachovia. When Thompson was fired by the Wachovia's Board, its stock was trading at $22.80.

Did Steel attempt to sell Wachovia at a Merrill Lynch-style, discount before Washington Mutual collapsed? I don't know. We do know there was a "bid" by Wachovia for Morgan Stanley. (How exactly would that have happened? Unsuccessful bluff, more like it.)

Ultimately, Wachovia was purchased by Citigroup for $2.16 billion or roughly $3 a share. What a travesty of a sale price.

My comment - For Charlotte, NC a big and final "Oops." And advice for Steel's next employer, Beware!

Everyone Take a Deep Breath

As the markets drop and Wachovia's disappearance has elevated anxieties about the future of our financial system, please keep this prespective from Safehaven.com's Haste Makes Waste in mind:

The problem with trying to legislate in the middle of a revolution is that you aren't sure whether you are governing the world that is being destroyed or the one that is coming into being. There can be little question that the Wall Street that existed at the beginning of this year is no longer the industry that Congress is seeking to rescue from its own excesses. The financial world has been permanently altered by the collapse of the debt bubble that inexorably
built up over the past three decades. Now Congress is trying to design a rescue plan for a world whose shape is highly contingent and unstable. Such an undertaking requires more than two weeks of work.

Conventional thinking tells us that the government must do something to stabilize the markets immediately, and that doing something is better than doing nothing. Once again, conventional thinking is wrong. Congress would be much better advised to take the extra few days or week it would take to structure a plan that the world is going to have to live with for a very long time.

As we were completing this newsletter, the House of Representatives voted down the emergency package and the financial markets are panicking. Such panic is unwarranted. The world should take a deep breath and consider whether defeat of a deeply flawed bill should be treated as a catastrophe or a rallying cry to develop a better plan that addressed the underlying issues that need to be fixed.

Paulson Bailout Vote - Epic Fail - UPDATED

205 v 228.
Wow. Don't really know what say here. They've moved on to voting about minting commemorative coins now. For serious. According to the Times House leadership is planning a second attempt to pass the bill, though Steve Liesman at CNBC is saying that there's no possibility it will happen today. BTW - Sue Myrick voted against the Bailout; I suppose I will have to vote for her now.

So now go fill your gas tank, fill your food pantry and withdraw some cash; prepare for the financial Armageddon predicted by Paulson and Bush. And Congress, you can start afresh crafting a real financial rescue plan.

3:21 pm Update - Democrats and Chicken Littles -- You've Been Punked (but there is still more than 30 minutes left on trading day). See Clusterstock.com - Market To Feds: Your Bailout Wouldn't Have Worked Anyway

More on the Farce Bailout - QCers Call Your Reps - UPDATED

Are Taxpayers Actually Expecting a Profit on the Bailout?

A hurricane of "happy talk" has swept through the Mainstream Media as everyone from President Bush to Bill Gross is talking up the expectation that not only will the bailout eventually cost taxpayers nothing--it will turn a big profit! Will greed drive the American to accept this proposal?

Read Oftwominds.com on the proposed bailout which is premised on this fantasy is a sham.

Yes, things are going to get epically bad (with or without this bailout), but this bill doesn't ultimately relieve any of the underlying causes of the financial meltdown. And yes, this proposal is not the only way to recapitalize our troubled financials.

Also, see Clusterstock.com on Analyzing The Bailout. The "modifications" to Paulson's bill are only cosmetic. Yes, most of our representatives are clueless. Is it any surprise that Congresspeople elected for their ability to clear brush or deliver sound bites with a photogenic smile are about to cast one of the most important votes of their careers without a clue about what they're voting for? Someone said that "The best argument against democracy is a five minute conversation with the average voter". The American corollary to that adds a 5 minute conversation with the average elected representative...

So make it easy for them: Call your Representative and Senators Dole and Burr and tell them NOT THIS BAILOUT PLAN.

9/30 1pm update - Congress "Debate Bailout" - Team "We Hafta" vs. Team "Nuh-uh." I fully think that Team We Hafta will win. What a spectacle. This will be disasterous.

Citichovia

Citigroup Inc. to Acquire Banking Operations of Wachovia
FDIC, Federal Reserve and Treasury Agree to Provide Open Bank Assistance to Protect Depositors

FOR IMMEDIATE RELEASESeptember 29, 2008 Media Contact:Andrew Gray (202) 898-7192angray@fdic.gov

Citigroup Inc. will acquire the banking operations of Wachovia Corporation; Charlotte, North Carolina, in a transaction facilitated by the Federal Deposit Insurance Corporation and concurred with by the Board of Governors of the Federal Reserve and the Secretary of the Treasury in consultation with the President. All depositors are fully protected and there is expected to be no cost to the Deposit Insurance Fund. Wachovia did not fail; rather, it is to be acquired by Citigroup Inc. on an open bank basis with assistance from the FDIC.

“For Wachovia customers, today’s action will ensure seamless continuity of service from their bank and full protection for all of their deposits.” said FDIC Chairman Sheila C. Bair. “There will be no interruption in services and bank customers should expect business as usual.

"Citigroup Inc. will acquire the bulk of Wachovia’s assets and liabilities, including five depository institutions and assume senior and subordinated debt of Wachovia Corp. Wachovia Corporation will continue to own AG Edwards and Evergreen. The FDIC has entered into a loss sharing arrangement on a pre-identified pool of loans. Under the agreement, Citigroup Inc. will absorb up to $42 billion of losses on a $312 billion pool of loans.

The FDIC will absorb losses beyond that. Citigroup has granted the FDIC $12 billion in preferred stock and warrants to compensate the FDIC for bearing this risk.In consultation with the President, the Secretary of the Treasury on the recommendation of the Federal Reserve and FDIC determined that open bank assistance was necessary to avoid serious adverse effects on economic conditions and financial stability.

Per Dealbreaker.com: The FDIC insists that Wachovia didn't fail. No really. They swear. So the fact that it is the FDIC that is making the announcement that Citi is buying the banking operations of Wachovia is really just coincidence. Seriously. See, we call it "open bank assistance." As you can see that takes the emphasis off of negative and dangerous words like "failure" and refocusing attention on "open." They were considering a "running bank rescue," but that was before Sheila Bair pointed out the fact that a "rescue" implies distress and "running" sounds a lot like the bank executives are fleeing the jurisdiction.

My comment: The banking "club" as it exists now: GS, C, BAC and JPM.

QCers Express Yourself Re the Bailout Plan

Ok, this isn't just a Queen City issue; it affects all Americans.

Call Your Member of Congress and politely suggest that giving Hank Paulson 700 billion dollars is insane. Use "The Google" to find their numbers, or call the House switchboard at: (202) 224-3121.

Many are saying that this proposal is socialist. It is most definitely not socialist. Paulson and the Fed are NOT discussing egalitarian economic rights for all; they are NOT promoting an economic system that redistributes corporate profits to all citizens. No, this plan is closer to economic fascism (corporatism) -- that is, financial entities operating underand profiting from corporate welfare. This plan will forever change the face of our economic and political systems in one swoop.

Read more on why this plan is a travesty at Naked Capitalism: "Why You Should Hate The Treasury Bailout Proposal."

Update 9/23 - Bank of America Says "Paulson Plan Benefits Mostly Goldman, Morgan" . Wonder how Wachovia views the bailout?

More on Obama's Visit to the QC

The Observer liveblogs Barack Obama in Charlotte: Live updates. Reporter Jim Morrill describes visit as, "Something important and historic. "

NY Post Attacks Wachovia and Steel

"The issue of Wachovia's loan portfolio strength was brought to the fore last week when its shares shot up on word that Morgan Stanley was weighing a deal to buy the bank. But Morgan bankers, once they kick the tires, will surely find out that a couple of the tires may be flat."

Why is the New York Post so negative on Wachovia and CEO Steel? Hmmm. Are you getting the feeling that MS + WB = NOT HAPPENING. Or maybe that doesn't even matter anymore in our Post-Bailout World.

Update 9/21 - Morgan Stanley snubs Wachovia

Obama's Charlotte Speech on the Bank Bailout

Today here in Banktown, USA, over 20,000 rally attendees heard Barack Obama respond to the "Bank Bailout Plan."

"Even if the Treasury recovers some or most of its investment over time, this initial outlay of up to $700 billion is sobering. And in return for their support, the American people must be assured that the deal reflects some basic principles."

No blank check. If we grant the Treasury broad authority to address the immediate crisis, we must insist on independent accountability and oversight. Given the breach of trust we have seen and the magnitude of the taxpayer money involved, there can be no blank check.

Rescue requires mutual responsibility. As taxpayers are asked to take extraordinary steps to protect our financial system, it is only appropriate to expect those institutions that benefit to help protect American homeowners and the American economy. We cannot underwrite continued irresponsibility, where CEOs cash in and our regulators look the other way. We cannot abet and reward the unconscionable practices that triggered this crisis. We have to end them.

Taxpayers should be protected. This should not be a handout to Wall Street. It should be structured in a way that maximizes the ability of taxpayers to recoup their investment. Going forward, we need to make sure that the institutions that benefit from financial insurance also bear the cost of that insurance.

Help homeowners stay in their homes. This crisis started with homeowners and they bear the brunt of the nearly unprecedented collapse in housing prices. We cannot have a plan for Wall Street banks that does not help homeowners stay in their homes and help distressed communities.

A global response. As I said on Friday, this is a global financial crisis and it requires a global solution. The United States must lead, but we must also insist that other nations, who have a huge stake in the outcome, join us in helping to secure the financial markets.

Main Street, not just Wall Street. The American people need to know that we feel as great a sense of urgency about the emergency on Main Street as we do the emergency on Wall Street. That is why I call on Senator McCain, President Bush, Republicans and Democrats to join me in supporting an emergency economic plan for working families – a plan that would help folks cope with rising gas and food prices, save one million jobs through rebuilding our schools and roads, help states and cities avoid painful budget cuts and tax increases, help homeowners stay in their homes, and provide retooling assistance to help ensure that the fuel-efficient cars of the future are built in America.

Build a regulatory structure for the 21st Century. While there is not time in a week to remake our regulatory structure to prevent abuses in the future, we should commit ourselves to the kind of reforms I have been advocating for several years. We need new rules of the road for the 21st Century economy, together with the means and willingness to enforce them.

Read Obama's prepared remarks at Politico.
Read about the proposed bailout at Calculated Risk.

P.S: I will post photos of this event -- albeit the event from outside the barricades looking in. The streets of Charlotte were mobbed with people -- young, old, families, couples, and college students of all races, colors and compositions; I've never enjoyed waiting in line so much.

P.P.S: I'd also venture to guess that the media's "20,000 attendees" doesn't include those of us that couldn't get in. And there were alot of us.

Morgan Stachovia?

The Times reports that Morgan Stanley is considering a merger with Wachovia. Discussions are purely preliminary.

New Banking Rule - There Are No Rules

From the Financial Times article, "Wall Street Crisis Deepens"

The Federal Reserve said it was making it easier for financial institutions to access Fed liquidity by easing terms on its borrowing facilities and accepting a much wider range of assets as collateral. The Fed meets to decide on interest rates on Tuesday. It widened the set of assets eligible as collateral for loans of Treasuries to include all investment grade paper, and raised the size of these Treasury loans to $200bn.

The Fed also suspended rules that prohibit banks from using deposits to fund their investment banking subsidiaries.

Was this the quid pro quo for Band of America buying Merrill? If so, repercussions will extend beyond BofA. This is a time when the federal authorities need to be vigilant, not lax about banks taking risk with depositors' funds.

P.S. Ken Lewis on TV right now telling everyone that everything will be great (BofA headquarters will remain in Charlotte). His eyes are so dilated; he looks scared.

BankofAmerillLynch - Shotgun Marriage

I'm not even sure where to begin as the news this weekend on Bank of America is simply stunning. So I give you Mish's Global Economic Analysis Another Shotgun Marriage: Bank of America and Merrill Lynch:

It's all over for Lehman. Action in the main poker room action has stopped. None of the players wants to bet a penny on the Lehman pot. Indeed, Lehman Prepares For Bankruptcy as Buyers Withdraw.This is a realization the pot is worthless. Nonetheless, expect to hear clowns screaming about "naked shorts" wrecking Lehman just as they screamed the same nonsense about Bear Stearns.

Action has now shifted to side games as AIG Struggles To Stay Alive, Begs Fed For Cash.In another side game at least as big as the main game, Bank of America Agrees to Buy Merrill Lynch for $44 Billion.

Bank of America has struck a $44 billion deal to buy Merrill Lynch, a merger that will unite the nation's largest consumer bank with one of its most celebrated investment banking firms. Both boards have approved the deal and it is now being reviewed by lawyers, the sources said. Bank of America will pay about $29 for each share of Merrill Lynch stock.

A Shotgun Marriage?

I sense a shotgun wedding sponsored at gunpoint by the Fed.Without this buyout announcement Merrill Lynch would have gotten absolutely crushed tomorrow. That is absolutely certain. The closing price of Merrill Lynch was $17.05 on Friday. Mother Merrill's market cap was roughly $26 billion. Thus... Bank of America (BAC) agreed to pay $44 billion for a company that would have been worth $18 billion on Monday's open, assuming a $5 markdown on Monday to $12. Why?No one had any cash to buy Merrill other than BAC so what's the rush?

Various swap-o-rama tables are now in full swing with everyone trying to figure out who is holding what and who the counter parties are, and just what anything is worth, if indeed anything is worth anything at all.

Gasoline Panic in NC

The Charlotte Observer writes in Consumers Enraged By Gas Price Spike that "when Hurricane Ike struck the Gulf Coast, it shut down 14 oil refineries." (My comment - The Colonial Pipeline which transports fuel to the southeast and northeast regions has also been disrupted.)

The Observer goes to report:

The effects of that shutdown are being felt nationally as a fuel shortage leads to spikes in prices and runs on gasoline from Tennessee to New York. The impending gas shortage forced N.C. Gov. Mike Easley and S.C. Attorney General Henry McMaster this week to activate anti-gouging provisions. The laws prohibit companies from charging unreasonably high prices."

The news from South Carolina is even worse. Half of the 26 Midlands stations visited by The State newspaper on Saturday were either out
of fuel or out of one or more grades of gas. Station operators were
unsure when their next shipments would be delivered.

Is this irrational panic by the gas consumer? Is this a simple matter of supplier price gouging? How long will it last? Over at Mish's Global Economic Analysis, there is a good overview of this in Gasoline Shortages And Higher Prices Likely Headed Your Way . Essentially, the consumer will have no choice but to conserve gas.

Update 9/14 - Check gasbuddy.com to see latest average gas prices in the U.S. and Canada. Currently Charlotte's average is $4.141 per gallon; Knoxville has the most expensive gas at $4.847.