After better-than-expected numbers from Goldman Sachs and Intel set off a broad weekly rally on Wall Street, stocks lacked direction Friday and ended the day little changed as investors braced for fresh corporate announcements.  Also fueling the rally was analyst Meredith Whitney’s bullish stance on Goldman as she assigned a “buy" rating on the bank.  That set the stage for a 7% market rally in just five sessions with the Dow Jones industrial average and the S&P 500 index posting their best weekly performance since the week ending March 13.

For the week, the DJIA jumped 597.42 points, or 7.3%, to 8,743.94 points and the S&P 500 rose 7% to 940.38.  The tech-heavy Nasdaq Composite Index rose for eight consecutive sessions, its longest run since 2005, ending the week up 131 points, or 7.4% to 1,887.

As Goldman announced earnings of $4.93 a share, well above analysts’ estimate of

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On Jul 16, Former Treasury Secretary Henry Paulson is expected to testify before the House Oversight and Government Reform Committee as to whether he and/or other government officials pressured Bank of America (BAC) to acquire Merrill Lynch, which resulted in a $20 billion cost taxpayers.

This will follow BAC CEO Kenneth Lewis' statements before the committee that both Paulson and Federal Reserve Chairman Ben Bernanke threatened to oust BAC's CEO and the bank's board members if they abandoned the takeover after discovering losses at Merrill.

In September 2008, BAC agreed to acquire Merrill Lynch, which resulted in the government supplying an additional $20 billion to BAC in order to cope with rising losses following the acquisition. This was on top of the $25 billion from the government's bailout program.

We would be surprised if the story behind the headlines is ever revealed.

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The markets had a good day as all three major indexes were up over 2%, with the Dow up 2.08% to finish at 8472.40.  The NASDAQ and S&P were up 2.08% and 2.14% respectively, closing at 1829.54 and 920.26.  The 10-year saw price climb over a dollar as the yield ended at 3.544%.  Crude oil saw prices rise, settling at $70.23, with August gold also seeing prices head up as the dollar weakens, settling at $939.50. 

American International Group [AIG: 1.46, 0.00 (0.00%)] and the Federal Reserve Board of New York agreed that AIG can repay $25 billion that they owe the New York Reserve through initial public offerings of the two of its international life insurance units.  AIG will put equity from American Life Insurance Co. and American International Assurance Co. into vehicles and receive preferred and common interest in exchange.  AIG will hold the common interest while

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Currency rally gets wiped out…Geithner to talk about a strong dollar? Brazil cuts rates! The Fed to control everything? YIKES! And Now… Today’s Pfennig!

Good day… And a Happy Friday to one and all! Another seemingly long week for yours truly… Where’s a 3-day Holiday weekend when you need one? Have you been following the goings on with the investigation into the Bank of America (NYSE:BAC) purchase of Merrill Lynch? Whoa, there partner! I thought for sure this would get all swept under the rug, but it’s all coming out, every dirty deed! Dirty deeds done

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Early today, Kenneth Lewis, CEO of Bank of America (BAC) was testifying before a government oversight committee with respect to his company's January 1, 2009 acquisition of Merrill Lynch.Considering recent announcements by the company, we would suspect there will be several more inquiries in the future for Mr. Lewis.Members of the Oversight and Government Reform Committee and the House Oversight and Investigations subcommittee hammered for a rationale as it appeared to them that Mr. Lewis failed to file the appropriate information prior to the December 2009 shareholder vote with respect its then-acquisition target Merrill Lynch, and known widening losses as of November 2009 -- thereby demonstrating that B of A neglected to meet the government's disclosure rules.The House Oversight and Investigations subcommittee's brought to light that Mr. Lewis was aware of the acceleration of the substantial losses at Merrill Lynch, but did ...

Equities started the day up well over a percent but that was very short-lived as the markets quickly fell on a slew of bad economic news.  By the end of the day, however, the equity markets were able to recover and posted only small losses on the day.  The Dow Jones Industrial Average fell 24.04 to 8,739.02 for a loss of 0.27% while the Nasdaq Composite and the S&P 500 Index fell 7.05 and 3.28 to levels of 1,853.08 and 939.15, dropping 0.38% and 0.35% respectively.  One of the reasons that the markets sold off was due to a weak U.S. Treasury auction on $19B worth of 10-year notes.  The bid-to-cover ratio on the auction was 2.62, but with a coupon rate of 3.125% and a yield awarded of 3.990% the market was caught off guard and began to sell off.

Crude oil was trading up after hours touching $71.87

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On Thursday June 4, 2009, several news items hit the tape which raise some concerns for Bank of America (BAC) over the near term regarding the potential for enhanced legal fee expenses and enhanced credit issues.First, Angelo Mozilo, former chairman of the once top U.S. mortgage lender Countrywide Financial -- which was acquired by BAC last year (the name was scrapped about 10 months later) -- and several other executives were accused by The Securities and Exchange Commission (SEC) of fraud. A criminal investigation has occurred based on emails in Mr. Mozilo warned of his company's "toxic subprime mortgages" at the height of the housing boom.On Sept. 26, 2006, there was an email that stated, "The bottom line is that we are flying blind on how these loans will perform in a stressed environment of higher unemployment, reduced values and slowing home sales." This ...

Exchanging Platinum for SilverEarlier today, Bank of America (BAC) announced that it may swap 200 million common shares for existing preferred stock, which is expected to total more than $2.0 billion of the company's $33.9 billion capital shortfall following the governments "stress test" on the institution. This announcement follows yesterday's announcement that the institution raised nearly $26.0 billion of equity capital in May (to include $5.9 billion from another common shares for preferred stock swap).As the Federal Reserve has limited the extent to which capital holes can be filled through increased revenue, Bank of America may use only approximately $1.7 billion of expected excess revenue for this purpose. In addition, BAC stated that it might issue nearly 565 million shares from similar swaps or about a 10% dilution to the current share basis. The exchange offer is set to expire on June 24, 2009....

A batch of gloomy economic reports during the past few days suggested that recent optimism about a global recovery might have been premature. This caused Doug Kass to warn that “stock prices have moved ahead of fundamentals” and Kenneth Langone to caution that “investors seem to be getting ahead of themselves”, although he maintained that the long-term outlook on the market was positive.

Big banks across the US announced large common stock offerings and plans to repay the government, and the US administration attempted to bring transparency to the credit derivatives markets and also crack down on the credit card industry.

In addition to Kass and Langone, commentators featured on camera in this post include Elizabeth Warren, Meredith Whitney, Alan Greenspan, Peter Boockvar, Giles Keating, Jim Rogers, Barry Ritholtz, Dennis Gartman, Abby Cohen, Peter Eliades and Laszlo Birinyi.

The

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Bank of America Corp. (NYSE: BAC) plans to sell assets and issue more common stock after being told by the federal government that it must raise $33.9 billion to adequately guard against “more adverse” economic conditions.

Bank of America was one of 10 banks told by the government to raise more capital following the so-called stress test. The government concluded that BofA faces a potential $136.6 billion in losses from troubled loans and investments in 2009 and 2010. The bank’s $34 billion capital shortfall was more than twice that of Wells Fargo & Co. (NYSE: WFC), which had the second greatest capital need.

BofA Chief Executive Officer Kenneth Lewis said Thursday that his company will start closing the capital shortfall by raising $17 billion in common equity, both by selling new shares and converting a portion of its privately held

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