The U.S. unemployment rate, currently at a level of 6.5%, could rise to 8% next year. But it could also find a ceiling sooner than expected, as more companies implement unpaid vacations and four-day workweeks to preserve jobs.

The U.S. recession may just now be entering full swing, but storm clouds have been gathering for more than a year and many companies have already trimmed payrolls. Now, the goal for many companies is to prepare for an economic rebound by finding ways to keep the their skilled productive labor intact.

“More companies are exploring alternatives to layoffs,” John A. Challenger, chief executive of consulting firm Challenger, Gray & Christmas, told BusinessWeek. “If they can keep people on until the business turns around, the company would be in much better shape to ramp up quickly.”

Dell Inc. (DELL) employees, for instance, recently received a memo

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Initial Claims for the week ending Dec. 20 increased to a 26-year high, by 30,000 to 586,000 from the upwardly revised figure of 556,000 (+1,000) from last week, a 3.7% surprise from the 565,000 estimate.  This is the 7th consecutive week unemployment filings surpassed the half million mark.  Last year, only 353,000 initial claims filings were made, which is over 200,000 higher in recent weeks as a consequent of the lingering recession.  In the past week, ending December 13th, initial claims decreased as a result of fewer filings in North Carolina, California, Pennsylvania, and Georgia, all decreased by more than 10,000, following a spike in filings in those states the prior week (increased fillings by more than 20,000), from fewer layoffs in textile, furniture, lumber wood, fabricated metals, transportation, service, manufacturing, and construction industries.  The 4-week moving average was 558,000, an increase of 13,750 from the previous week's

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A Rare Bank Without Defaults

by David Fessler, Advisory Panelist Friday, December 19, 2008: Issue #904

No Credit… No License… No History? No Problem?

Even before our current mortgage meltdown, most banks would never touch a prospective customer with any one of the above issues, let alone all three. But there’s one bank in a quiet little corner of Pennsylvania that’s made thousands of loans - all to customers who have no credit history, zero credit scores, no drivers license and nothing beyond an eighth grade education. The most amazing part is that they’ve never had even one customer default on a loan. And that’s thousands of customers over a 20-year period. How can this possibly be true?

A number of reasons…

This bank strictly adheres to one of the most basic principles of

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strongWall Street Journal and Financial News/strongbr /br /By Jason Corcoranbr /br /15 December 2008 br /br /Fund managers have called the bottom too oftenbr /The investment horizon has experienced so many false dawns over the past 18 months that investors could be forgiven for regarding any rose-tinted outlook as a mirage.br /br /Every time the stock market suffers another steep drop, fund managers and investment sages pronounce that the market bottom is in sight and now is the time to buy.br /br /Fundamentals, technical signs and precedents may have backed up some of their theories but subsequent slumps in valuations have not borne out their views.br /br /Ken Kinsey-Quick, head of multi-manager strategies at UK asset manager Thames River Capital, said: “The problem with predictions is that no one has a perfect crystal ball. Anyone making a prediction is taking a risk which gives them about a 30% chance ...

In 1971 a nuclear physicist Ralph Lapp used the phrase “China Syndrome” to describe what might happen in an extreme example of a nuclear power plant meltdown. His theory was that the molten core of the reactor might be so hot and toxic that it would burn through the floor of the power plant and sink through the earth’s crust before exiting the other side of the earth through China.

This has never happened in the various nuclear accidents, but it’s a powerful idea that spawned the 1979 movie called The China Syndrome, which was released just 12 days before an accident at the Three Mile Island nuclear power plant in Pennsylvania.

I only mention it because the idea captures quite nicely the potential economic impact here of a Chinese economic slump. New Zealanders underestimate the impact of Chinese economic boom on the global economy generally and on our own economy.

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a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="http://2.bp.blogspot.com/_7ZckZ-8naz0/STSRedkyhHI/AAAAAAAACOI/O8X5Hfl3XXo/s1600-h/Dec+1+011.jpg"img style="margin: 0pt 10px 10px 0pt; float: left; cursor: pointer; width: 400px; height: 300px;" src="http://2.bp.blogspot.com/_7ZckZ-8naz0/STSRedkyhHI/AAAAAAAACOI/O8X5Hfl3XXo/s400/Dec+1+011.jpg" alt="" id="BLOGGER_PHOTO_ID_5275001016078730354" border="0" //aFirst item is a href="http://online.wsj.com/article/SB122809294013867881.html"this article from the WSJ/a. Apparently the Pennsylvania employee pension has run into some trouble with a portable alpha strategy sold to it.br /br /I would think the legacy of a href="http://en.wikipedia.org/wiki/Robert_Citron"Robert Citron/a would have taught all municipal pools of money to beware investment banks selling sophisticated strategies.br /br /As a theme of the last couple of days; there is nothing wrong with simplicity. To that point I wanted to touch on something that I don't think I have specifically focused on enough.br /br /One of the goals of taking defensive action after heeding a warning of some sort from the market is to simply have smaller ups and downs within the portfolio. I've spelled out the actions I have taken numerous times ...

The UAW holds the key to the success of the U.S. auto industry. The recent Senate hearing with the CEOs of the big three car manufacturers was better than most sitcoms. The CEOs were unable to answer questions about how they plan to pay back the loans, or just avoided the question, or how long the loans would keep them afloat, or how they would change their business models to avoid asking the taxpayers to bail them out again. It went on and on.

The CEO of GM was asked how long GM had to pay the employees of a plant that had been closed. His answer, “I don’t know.” How long do you think you would be working for him with answers like that? The senator who asked the question shook his head in disbelief and muttered, “Unbelievable!”

The whole time the panel questioned the

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Expect more pain in the housing market next year, says Don Miller. Rising unemployment will keep the foreclosures coming. And as the backlog of inventories swells, Don says homebuilders still look ripe for shorting in this environment.

This from Money Morning:

The U.S. housing market is already being pounded by the “perfect storm.” And the outlook for the New Year is for the stormy weather to continue – and probably to get worse.

As if a locked-up credit market and tidal waves of foreclosures weren’t already enough, we’re now watching unemployment climb and consumer confidence plunge.

But even when the housing market is taking on water, there are ways to stay afloat. Indeed, investors nimble enough to maneuver can even make money.

The watchword on this market, though, is caution.  If an investor decides to test the waters, beware of the extraordinary financial undertow.

Here’s a look at what’s happening now, and

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Recent stories about Russian passports being distributed in Crimea, Ukraine have raised quite a ruckus. But that doesn't seem to be the only place in the Ukraine with some ethnic nationalism issues, and a new report we've translated from Izvestiya after the jump tells the story of Moscow's possible assistance to the Ruthenians - a fiercely independent group located in Transcarpathia, the western-most Oblast of the country, near the Polish, Slovakian, Hungarian, and Romanian borders. For centuries, the region was part of the Austro-Hungarian empire and known as Subcarpathia. (Everything depends on where you’re looking from: if your vantage point is Vienna or Budapest, the region is in the foothills “below” the Carpathian mountains, hence “Subcarpathia”. But if you’re looking from Moscow or Kiev, it’s on the “other side” of the mountains, hence “Transcarpathia”!) After ...

Monday November 13, 2008 Navivest

Standard & Poor’s is making changes to the S&P 500 and the S&P 400 MidCap. Following are details of the changes:

Wynn Resorts Ltd. (WYNN) is replacing Ashland Inc. (ASH) in the S&P 500, Ashland will replace Lear Corp. (LEA) in the S&P MidCap 400, S&P MidCap 400 constituent DENTSPLY International Inc. (XRAY) will replace Hercules Inc. (HPC) in the S&P 500, and Bucyrus International Inc. (BUCY) will replace DENTSPLY in the S&P MidCap 400 after the close of trading on Thursday, November 13.

Ashland will be acquiring Hercules in a transaction that will result in a company with a market value appropriate for the S&P MidCap 400, and which is expected to close on or about that date, pending final approvals. As of today’s close of trading Lear Corp. had a market value of approximately $129 million, ranking 400th in the S&P MidCap 400 index.

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