Goldman Sachs Group Inc. (GS) is contemplating buying tax credits from Fannie Mae (FNM). However, it may be reasonable to assume that the U.S. Treasury may not approve of the deal. Goldman hopes to receive approval this week for $1 billion worth of tax credits. Tax credits are incentives designed to bring more investment to low-income housing developments. This would help the company reduce its tax bill as well as bring some much-needed financial relief to Fannie Mae. While financial details of the proposed transaction are not disclosed, Goldman could arrange other investors for the deal as well. The Obama Administration, however, is opposed to the deal, as it will reduce Goldman's tax bill at a time when Wall Street is already facing intense public scrutiny. Fannie Mae, a government-controlled mortgage financier, could get financial relief if Goldman bought the tax credits. As ...

For Immediate Release

Chicago, IL – October 28, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: DryShips, Inc. (DRYS), Capmark Financial Group Inc. (CPFNG), Citigroup Inc. (C), JPMorgan Chase & Co. (JPM) and Goldman Sachs Group Inc. (GS).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Tuesday’s AnalystBlog:

DryShips Beats, Results Hurt

DryShips, Inc.’s (DRYS) third-quarter earnings of 27 cents per share were 6 cents ahead of the Zacks Consensus Estimate. This excludes a loss of $39.3 million or 15 cents per share associated with the valuation of the company’s

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Capmark Financial Group Inc. (CPFNG), one of the key commercial real-estate lenders in the U.S., along with some of its subsidiaries has filed Chapter 11 protection. The filing adds to the lingering concern that the commercial real-estate market is still struggling.  The company seeks to be allowed to continue to pay its vendors and salaries, and protect the businesses with its customers and partners.  Capmark was created in March 2006 through a leveraged buyout of the commercial real estate assets of General Motors' finance arm GMAC. Earlier this year also, the company had indicated that it might file for bankruptcy due to deteriorating conditions in the financial and commercial real estate markets and capital inadequacy.  Capmark is currently negotiating the terms of the bankruptcy with its creditors, which include Citigroup Inc. (C) and JPMorgan Chase & Co. (JPM) among others.  Capmark ...

Weak global economic conditions and a downgrade of Well Fargo by prominent banking analyst Richard Bove spooked investors even as Morgan Stanley and Yahoo reported better-than-expected earnings.  The Dow Jones industrial average slipped below the 10,000 level yesterday as markets pulled back in the final hour of trading.

Bove of Rochdale Securities said earnings at Well Fargo (NYSE:WFC) were helped by mortgage-servicing fees rather than improving business trends, and trimmed his rating on the bank to “sell" from “hold."  However, Well Fargo and Morgan Stanley (NYSE:MS), which reported its first quarterly profit in a year, were behind the market’s strength earlier in the session.  Bove also cited accelerating loan losses at the firm for the downgrade.  After Bove’s cut, FBR slashed its rating on the firm to "underperform," questioning Well Fargo's earnings quality.

The Dow Jones industrial average fell below the psychologically important 10,000 level, declining 92.12 points, or

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This post provides links to a number of thought-provoking articles I have read over the past few days that you may also find of interest.

• Evans-Pritchard (Telegraph): German “wise men” fear credit crunch in 2010, October 15, 2009. Germany’s leading institutes have warned that the pace of economic recovery is “unsustainable” and that the country’s banks may face a fresh crisis over the next year as bad debts surface in earnest.

• Lasse Heje Pedersen (NYU Stern School of Business): When everyone runs for the exit, August 2009. The dangers of shouting “fire” in a crowded theater are well understood, but the dangers of rushing to the exit in the financial markets are more complex. Yet, the two events share several features …

• Anthony Bolton (Financial Times): Are developed or emerging markets the future of investing? October 16,

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For Immediate Release

Chicago, IL – October 16, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Goldman Sachs Group Inc. (GS), ASML Holding N.V. (ASML), Applied Materials (AMAT), KLA Tencor (KLAC) and Lam Research (LRCX).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Thursday’s Analyst Blog:

Goldman Beats Zacks Estimate

Goldman Sachs Group Inc.’s (GS) third quarter 2009 (ended Sept. 25, 2009) earnings of $5.25 per share were significantly ahead of the Zacks Consensus Estimate of $4.13.

Results reflected strong performance in the trading operations, which offset the decrease in

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Markets advanced Monday morning, with oil reaching a 6-week high above $73 a barrel, a rally in European stocks after Royal Philips Electronics announced its glowing earnings report, and a general sense of economic recovery. Going into a foreseeably light Columbus Day of trading, a weaker dollar has pushed all major energy and commodities sectors notably higher, extending last week’s gains, in anticipation of an onslaught by a spate of Q3 earnings data over the next few weeks.

Intel is poised to offer solid earnings data Tuesday afternoon and many investors are expecting a bullish Q4 outlook from the company, setting a positive tone for chip manufacturers. Fairchild Semiconductor (FCS) and Cypress Semiconductor (CY) data will be out before Thursday’s markets open with Advanced Micro Devices (AMD) posting its report after the close. Nokia, IBM and Google will also report Thursday with JPMorgan Chase & Co., Goldman Sachs Group Inc.,

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Goldman Sachs Group Inc. (GS) is contemplating to amend the terms of a $3 billion loan which it had given to struggling lender CIT Group Inc. (CIT) to enable it to continue using the facility.  The investment bank extended a 20-year funding to CIT in Jun 2008. According to the terms of the contract, CIT will pay Goldman 2.85% of the maximum amount lent, which would come to about $85.5 million annually for the first 10 years of the agreement. CIT would be required to pay $1 billion if it files for Chapter 11 bankruptcy.  CIT, one of the nation's largest lenders to small and midsize businesses, received $2.3 billion in federal bailout funds last year. In July, the company secured a $3 billion emergency loan from some of its largest bondholders, evading an immediate bankruptcy filing. But the company still needs to reduce its ...

Kenneth D. Lewis There are many ways to view Kenneth Lewis’ eight-year reign as Bank of America Corp. (NYSE: BAC) chief executive, but two seem to hold the most landscape.

On one hand, the $130 billion he spent on acquisitions – FleetBoston Financial Corp., MBNA Corp., LaSalle Bank Corp., Countrywide Financial Corp., Charles Schwab Corp.’s (Nasdaq: SCHW) U.S. Trust private banking unit and Merrill Lynch – that more than tripled the size of Bank of America, making it the largest U.S. lender both by assets and deposits.

On the other, his open-wallet policy and the example it set forth almost perfectly encapsulates the boom, bust and nascent rebound of the U.S. housing and banking crisis – which later became the financial plague that devastated markets all over the world.

In the second half of 2007, the extent of the U.S. housing crisis began to crystallize when Countrywide’s freewheeling

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Investment banks have gotten fat off the land since 1982, when the great U.S. bull market got its start. Their business has multiplied many-fold, and their earnings have soared into the stratosphere, to a level far higher than any other sector.

Now, JPMorgan Chase & Co.  (NYSE: JPM) has issued a report suggesting that investment-banking returns on capital will be sharply down over the next few years. Perhaps this will be only a moderate downturn.

However, there’s also a good chance that labor-cost pressures – combined with tightening margins – will take the likes of JPMorgan and Goldman Sachs Group Inc. (NYSE: GS) down a path similar to that of General Motors Corp. (NYSE: GRM) and Chrysler Group LLP, both of which earlier this year declared bankruptcy.

Challenging Headwinds

JPMorgan anticipates that the regulatory changes that are likely to take place over the next year or so

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