Posts Tagged ‘Coins’
By DAN FITZPATRICK/Liz Rappaport
Wall Street Journal Online
MARCH 19, 2011
Some of the nation’s largest banks are about to line shareholders’ pockets with $8.7 billion in new dividend payments this year.
Minutes after the Federal Reserve privately notified some financial institutions that they passed a new round of regulatory “stress tests,” six sent out a flurry of statements Friday detailing the new payouts. Three more banks said they may raise dividends without specifying the amounts, likely providing another $3.4 billion for shareholders this year, according to research firms SNL Financial LC and RBC Capital Markets LLC.
The day was a watershed moment for the U.S. banking industry. In giving the nod to banks, regulators freed them from strict oversight for the first time since the 2008 financial crisis. At the time, the government forced banks to cut dividends and use the money instead to shore up their financial condition.
Potential 2011 dividends of more than $12 billion, paid by just nine banks, would dwarf the $4.5 billion in profits the entire industry posted in 2008.
The Fed’s move Friday to allow some banks to resume higher shareholder payouts also presented a clear division between the industry’s strongest and weakest players. J.P. Morgan Chase & Co., Wells Fargo & Co., BB&T Corp., U.S. Bancorp and PNC Financial Services Group Inc. were among the first to announce a planned restoration of dividends. Many of the same banks said they also intend to buy back shares, which likely would boost the value of their stock.
The Fed’s approval gave healthy banks the freedom to deploy their capital in other ways, including repaying creditors. Regional banks SunTrust Banks Inc. and KeyCorp received approval to repay more than $7 billion in combined U.S. aid.
Goldman Sachs Group Inc. said it now can redeem a $5 billion investment from Warren Buffett’s Berkshire Hathaway Inc. The infusion was critical for Goldman at the height of the financial crisis, but it was costly. Goldman had been paying Berkshire interest of $1.3 million a day, or $15 a second.
The Fed, though, isn’t letting go of all control. It will continue to require banks to notify regulators of any planned dividends and share repurchases over a 24-month period. Banks will be able to make their own decisions, but regulators still can slap institutions with enforcement actions if they determine that banks aren’t using capital wisely.
The Fed was cautious Friday in what it allowed even the healthiest banks to do. The restoration of dividends won’t return to precrisis levels, with the Fed limiting the payouts to 30% or less of anticipated earnings. J.P. Morgan Chase, a bellwether for the industry, raised its quarterly dividend to 25 cents a share, up from five cents. That is short of the 38 cents a share the company paid as late as 2009.
The first round of U.S. stress tests were introduced in early 2009 to determine how much of a cushion would be needed if a sluggish economy deteriorated. Those tests showed the 19 banks faced a total of $599 billion in losses over two years under the government’s worst-case, Depression-like scenario. The Fed directed 10 banks to add a total of nearly $75 billion to their capital buffers to insulate themselves from potential losses.
In this second test, the Fed asked the banks to show regulators whether plans to unleash capital could withstand an 11% unemployment level, a 1.5% drop in the real gross domestic product, a 6.2% drop in an index of home prices and a 27.8% drop in equity prices.
The new test “wasn’t wimpy,” said Gerard Cassidy, an analyst with RBC Capital Markets. He said the Fed’s metrics show that regulators still are concerned about the banks but also may be worried that restrictions could hamper their recovery. So, citing the relatively mild drop in GDP, for example, he said the test “wasn’t extremely difficult either.”
But it also was clear Friday that even as some banks lag behind rivals, the Fed allowed them to claim some sort of victory as a result of the test.
Regions Financial Corp., the only large regional bank that still hasn’t announced plans to repay its government aid, put out a statement Friday saying that it didn’t ask the Fed for approval to repay its federal aid or raise dividends.
“The company’s position of repaying the government’s [Troubled Asset Relief Program] investment in a prudent manner, on shareholder-friendly terms, remains unchanged,” the company said.
Read the entire article HERE.
As Silver Touches $34.90, US Mint Runs Out Of Bullion Blanks, Halts American Eagle Silver Coin Production
Submitted by Tyler Durden
03/02/2011 09:45 -0500
The scramble for non-dilutable currencies hits a frenzy as silver just touches on a fresh 31 year high of $34.90. To commemorate this historic event, the US Mint has halted American Eagle silver coin production, in addition to its ongoing halt of American Buffalo coins: “because of the continued demand for American Eagle Silver Bullion Coins, 2010-dated American Eagle Silver Uncirculated Coins will not be produced. The United States Mint will resume production of American Eagle Silver Uncirculated Coins once sufficient inventories of silver bullion blanks can be acquired to meet market demand for all three American Eagle Silver Coin products.”
Production of United States Mint American Eagle Silver Uncirculated Coins continues to be temporarily suspended because of unprecedented demand for American Eagle Silver Bullion Coins. Until recently, all available silver bullion blanks were being allocated to the American Eagle Silver Bullion Coin Program, as the United States Mint is required by Public Law 99-61 to produce these coins “in quantities sufficient to meet public demand . . . .”
Although the demand for precious metal coins remains high, the increase in supply of planchets—coupled with a lower demand for bullion orders in August and September—allowed the United States Mint to meet public demand and shift some capacity to produce numismatic versions of the American Eagle One Ounce Silver Proof Coin.
However, because of the continued demand for American Eagle Silver Bullion Coins, 2010-dated American Eagle Silver Uncirculated Coins will not be produced.
The United States Mint will resume production of American Eagle Silver Uncirculated Coins once sufficient inventories of silver bullion blanks can be acquired to meet market demand for all three American Eagle Silver Coin products.
Read the entire article HERE.
by Dan Armstrong
Posted: 07.12.2010 at 8:13 PM
New types of money are popping up across Mid-Michigan and supporters say, it’s not counterfeit, but rather a competing currency.
Right now, you can buy a meal or visit a chiropractor without using actual U.S. legal tender.
They sound like real money and look like real money. But you can’t take them to the bank because they’re not made at a government mint. They’re made at private mints.
“I sell three or four every single day and then I get one or two back a week,” said Dave Gillie, owner of Gillies Coney Island Restaurant in Genesee Township.
Gillie also accepts silver, gold, copper and other precious metals to pay for food.
He says, if he wanted to, he could accept marbles.
“Do people have to accept dollars or money? No, they don’t,” Gillie said. “They can accept anything they want or they can refuse to accept anything.”
He’s absolutely right.
The U.S. Treasury Department says the Coinage Act of 1965 says “private businesses are free to develop their own policies on whether or not to accept cash, unless there is a state law which says otherwise.”
That allows gas stations to say they don’t accept 50- or $100 bills after a certain time of day in hopes of not getting robbed.
A chiropractic office in Lapeer County’s Deerfield Township allows creativity when it comes to payment.
“This establishment accepts any form of silver, gold, chicken, apple pie, if someone works it out with me,” said Jeff Kotchounian of Deerfield Chiropractic. “I’ve taken many things.”
Jeff Kotchounian says he’s used this Ron Paul half troy ounce of silver to get $25 worth of gas from a local station.
Read the entire article HERE.