Archive: September, 2008
Mike Armstrong, Inquirer Columnist
As bad as the events in the financial markets have been over the last few weeks, the risk that the credit markets will spiral downward has increased.
That’s what Nigel Gault, Global Insight’s chief U.S. economist, said on a conference call yesterday. You may wonder how things could get worse. Welcome to the “negative feedback loop”:
As lenders worry about their prospects, they lend less. With fewer loans, the economy slows down. That results in more job losses and higher unemployment rates. Mortgage delinquencies and foreclosures rise, while housing prices fall. Lenders become less likely to lend and on it goes.
Mike Armstrong, Inquirer Columnist
I was prepared for some defining moment for Lehman Bros. over the weekend. And there were enough whispers involving Merrill Lynch so I wasn’t shocked that it sought comfort in the arms of another.
But American International Group’s $40 billion distress call threw me for a loop.
Three huge names in the financial-services business cried uncle the same weekend. How would U.S. investors react to this latest crisis?
Mike Armstrong, Inquirer Columnist
I'm not sure how many people in the Philadelphia area heard the news about Lehman Bros., Merrill Lynch and AIG this morning and decided to make major changes in their finances, but some must or you wouldn't hear all these commentators urging people to sit on their hands.
But we all play the investor, the saver and the borrower at various times during a year. So things to keep in mind right now:
1. If you have a Merrill Lynch or Lehman Bros. brokerage account, you should be fine. The Securities Investor Protection Corp. notes that the bankruptcy filing involving Lehman Bros. Holdings Inc. does not directly affect the broker-dealer called Lehman Bros. Inc.
Mike Armstrong, Inquirer Columnist
What does $125 billion look like?
Save for a serious payroll error, none of us will ever see that many zeroes.
But this week at the Convention Center, there will be 93 private-equity firms who oversee that much capital attending the 2008 M&A East conference.
Mike Armstrong, Inquirer Columnist
So Foxwoods and its partners will drop their plans for a $670 million South Philadelphia casino in exchange for the chance to build one in what is now a shopping mall in Center City?
I’ll be sure to check it out right after I take the tram over the Delaware River to the Simon Property Group mall at Penn’s Landing to buy something pretty for my wife.
Or maybe after I try that virtual Pirates of the Caribbean ride at DisneyQuest at Eighth and Market.
Mike Armstrong, Inquirer Columnist
Albert Einstein Healthcare Network has long planned to stretch beyond its North Philadelphia neighborhood to capture more business from better-insured suburbanites.
In January 2006, Einstein teamed with Montgomery Hospital in Norristown to build a new hospital in central Montgomery County. After unsuccessfully pursuing a site in Whitpain, the two now hope to build a $360 million hospital in East Norriton.
On the face of it, the strategy makes sense. Currently, 67 percent of the Einstein health system’s revenue depends on government programs such as Medicare and Medicaid. Suburban hospitals see fewer patients covered by Medicaid and more toting commercial insurance.
Mike Armstrong, Inquirer Columnist
Talk about burying the lead.
On the same day that the board of Innovative Solutions & Support Inc. declared a special cash dividend of $1 per share (which it announced at the time), it terminated its CEO (which it didn't announce until late Tuesday.)
Raymond J. Wilson is out as chief executive officer of Innovative Solutions.
Mike Armstrong, Inquirer Columnist
I really don’t like government subsidizing any industry when the potential market would appear to be incentive enough.
But what’s the market incentive to slowing climate change? Survival?
Thanks to a report by the Political Economy Research Institute of the University of Massachusetts-Amherst, we have one possible answer. Spend $100 billion over two years in six particular areas and the U.S. economy could create 2 million jobs.
Mike Armstrong, Inquirer Columnist
Home Health Corp. of America Inc., of King of Prussia, is going to have to change its name.
After more than 30 years of providing home health care, it just sold the last six agencies it had to Amedisys Inc., of Baton Rouge, La.
Amedisys announced the purchase on Monday but did not disclose the terms.
Mike Armstrong, Inquirer Columnist
With deal-meister Joseph N. DiStefano off today, I thought I'd make sure you got your deal fix.
From the world of commercial real estate, the Phoenixville Corporate Center was sold for $12 million.
That's a 167,531-square-foot building at 1039-1041 W. Bridge St. in Phoenixville, Montgomery County. (CORRECTION: Sorry, that's Chester County. Typing too fast.) Seller was Rosedon Holdings; buyers was CPG Acquisitions.
Mike Armstrong blogs about Philadelphia corporations and business-related topics. Contact him at 215-854-2980.
Reach Mike at marmstrong@phillynews.com.
