Archive for the ‘News’ Category

Government Funded Business Lending Initiative Begins

In an effort to stimulate the job economy and spending, the US government is giving six small business oriented banks $123 million to help fund small businesses. The Small Business Lending Fund was initialized by Presidents Barack Obama nearly two years ago, but it has taken lawmakers several months to agree on the terms of the program. More than $11 billion has been earmarked for the program, with a staggering 925 lending institutions applying for the fund. Although the banks will eventually have to repay the money that they receive, they will be eligible for a 1% repayment program.

The fund is aimed to help small and mid sized business owners to get loans that they would not otherwise qualify for. Since the credit market began to shrink in 2008, traditional banks are much more strict about their lending criteria. Basically, new companies and small business that don’t already have large existing lines of credit. These type of restrictions have made it difficult for entrepreneurs to launch the businesses that will help to stimulate the economy.

Banks that receive money under the Small Business Lending Fund will be required to lend out the majority of grants that they receive. Some money can be allocated towards operating expenses, but President Obama was diligent in ensuring that lenders would not be able to retain a large portion of their funding. This is only the first phase of the Small Business Lending Fund, and lawmakers will be watching to see what the results are before initiating the second phase.

Hedge Fund Managers Target Greece

The financial crisis in Greece has caused some investors to jump ship, but hedge fund managers want in. While lawmakers in Greece continue to work to stabilize the economy, opportunists are looking to gain from the country’s financial hardship. When a country is unable to pay its debts, fewer people want to invest. In the case of Greece, trouble has been looming for quite some time. In addition, the banks that have invested in Greek debt will have no way of collecting the money that is due to them.

The European Union has already bailed out Greece once, however, a second loan that is being discussed doesn’t look like its going to come through. The only way that Greece will be able to survive is if enough hedge funds agree to buy its bad debts. The bad news for Greek lawmakers is that they would be responsible for repaying these loans at a phenomenally high interest rate. In short, Greece might be funding several large scale hedge fund companies for the next few decades.

Although politicians in Greece don’t want to make the deal, they really have few other options. A total financial in Greece would have catastrophic effects on all of Europe, but it appears that the banks that Greece owes money to are unwilling to intercede yet again. Overall, Greece allowed itself to go into major debt without fully considering the future ramifications. Hedge fund managers from all over the world are converging on Greece with the goal of making huge profits.

Credit Card Companies Closing Longstanding Accounts

The credit card industry has faced a series of serious blows as of late. First, the US government moved to reduce the interest rates that credit card companies could charge customers. Then, millions of customers began defaulting on their debt. It seems that the most plausible response is to close the account of any customer that poses a risk – even for those that have recently paid down their debts.

Apparently, the simple action of asking for a credit line increase can prompt some credit card companies to close established accounts. Bank of America recently closed the accounts of more than 50,000 customers after taking a closer look at them. Customers that have fallen behind on other bills might find that their credit limits have been severely reduced while others have had to find out the hard way that their business is no longer wanted.

Because credit card companies are less likely to issue unsecured lines of credits to those with poor or nonexistent credit, they are focusing on the sub prime market again. Consumers with bad credit are frequently able to get secured credit cards, and they also are required to pay high yearly account maintenance fees. If one of these customers defaults, the credit card company is able to simply keep the deposit fee and then go after any extraneous fees that might have been assigned to the account. Some consumers are able to get their accounts reinstated if they are able to get through to the right entities, however, most view this strategy as a long shot.

Walmart’s ‘Going Green’ Motives Questioned By Financial Analysts

On the surface, Walmart has always been on the side of consumers as well as the environment, but just underneath, the retail giant only has one objective in mind – higher profits. Now that Walmart has announced its ‘going green’ initiative, critics have become even more critical about corporate tax cuts and back room deals with the government. Over the next few years, Walmart will be installing solar panels on the roofs of its stores and distribution centers in an effort to save energy as well as money. Even though the company has every right to cut costs, it is expected to cost tax payers billions of dollars.

Every company in the US that agrees to install energy efficient appliances, solar panels or practices energy conservation is able to qualify for huge tax breaks. The government will find a way to recoup these costs by taking the bill onto next year’s budget. As Walmart is one of the largest corporate run retailers in the world, financial analysts believe that the ‘going green’ initiative will have a negative impact on the general public in the long run.

The fact is that millions of American visit Walmart stores everyday. The great deals that they were used to finding are slowly disappearing. Walmart has slowly replaced all of the smaller convenience, hardware, retailer and grocery stores in neighborhoods all over the US. Shoppers are almost totally dependent on Walmart, and someday soon they will feel the full extent of the control that this corporate giant has over their lives.

Former Amazon Affiliates Going To Barnes & Noble

As Amazon continues to end contracts with affiliates in several states it seems that one of the company’s biggest competitors is looking to provide these displaced affiliates with a new option. Affiliates in Colorado, Rhode Island and North Carolina that were looking to make money online can no longer use Amazon because changes to their state legislatures would have forced Amazon to collect sales tax from their customers. It is worth noting that Amazon already collects sales taxes from their online customers in a handful of states including Washington, where Amazon headquarters are located. In response, Barnes & Nobles has openly invited recently ousted Amazon affiliates to join its affiliate program in an online posting.

When Barnes & Noble posted a message on its official website inviting banished Amazon officials into its ‘family,’ some Internet marketers started referring to B&N as the best affiliate program 2011. The fact is, many business owners were negatively impacted by Amazon’s rash decision. Many of Amazon’s most loyal affiliates depended on the company as their sole source of income. Although Barnes & Noble does not offer as many different types of products to consumers as Amazon does, affiliates will be able to quickly revamp their blogs and websites in order to accommodate the changes. Changing out a few links and writing new content is certainly easier than searching for an affiliate program that is as impressive as Amazon. This latest news has also made Amazon affiliates in other states extremely nervous about doing business with the retail giant. It is likely that they will test the waters with Barnes & Nobles and look for other stable affiliate programs. As Barnes & Noble is looking to expand its online presence adding a few thousand eager affiliates will certainly help the company to catch up with Amazon.