Morgan Stanley Finally Owns Up to All the Trouble It Caused; It’s a Darn Claim Unemployment Filings Are Up; Sears is Losing It

It was just a matter of time…

Image courtesy of  dream designs/FreeDigitalPhotos.net

Image courtesy of dream designs/FreeDigitalPhotos.net

Morgan Stanley is taking a bit of a beating today on Wall Street now that it has finally finally settled with the Department of Justice over its shady little role leading up to the 2008 financial crisis. Morgan Stanley reached a deal with the DOJ  that’ll have the bank paying $2.6 billion to get Uncle Sam off its back.  Attorney General Eric Holder and the DOJ will graciously end their probe into whether Morgan Stanley duped investors by telling them how very great their home loans were when in fact, they were anything but. This settlement is sure to put a major dent in MorganStanley’s 2014 profits. By major, I mean it’ll eat up nearly 50% of what MorganStanley got to take home in 2014. It officially lands Morgan Stanley on that illustrious list of banks who also had to shell out billion dollar settlements to the DOJ for their smarmy actions leading up to and during the 2008 financial crisis, including  – but not limited to –  Bank of America who reigns the top spot with a $16.7 billion payout. It’s followed by JPMorgan Chase which holds the number two spot for its $13 billion settlement. Citigroup rounds out the group with a $7 billion settlement.

Don’t stake this claim… 

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Image courtesy of renjith krishnan/FreeDigitalPhotos.net

The number of people filing jobless claims went up. Not down. But up. The number climbed to 313,000 people instead of a projected 290,000. While the news is a bit of drag, economists  – who presumably know a thing or two  – are telling us that we can’t work ourselves up into a collective panic over one month’s lousy numbers. At least for now, anyway. First, the number of people filing those claims is still relatively close to the 300,000 mark. If it were way past that number, then yeah, having a fiscal freak out might be considered almost acceptable. Two, the labor market’s rockin’, sort of, and hiring is strong, which brings us to reason number three. Because hiring is strong, wages are actually going up. Walmart, TJ Maxx, Gap…the list goes on as to how many retailers are raising its employees’ wages. All these factors allow us to almost ignore this fiscal hiccup. However, leave it to Fed Chairwoman Janet Yellen to remind us that, “wage growth remains sluggish” and that there’s always room for improvement.  You don’t say.

Loser…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Sears isn’t having a very good year. Actually it hasn’t had a good year in…well, many many years. It just reported its fourth straight year of losses with this quarter losing $159 million and $1.50 per share. Incidentally, that figure is not nearly as dismal as last year’s $358 million fourth quarter loss. So you see, there is a bright side. Sort of. Run by the The Hoffman Estates, which also runs Kmart, the company has tried just about everything to help the ailing retailer reverse its downward financial spiral. From store closures to slashing inventory, the retailer has tried countless ways to cut costs. The company closed over 230 stores in 2014 and today has over 1,700 stores, which sounds impressive. But you know what’s more impressive? The over 3,500 stores the company had five years ago. The latest plan is to spin off between 200-300 stores into a REIT, which stands for Real Estate investment trust, by the way. The idea is apparently going to allow the failing company to pick up some $2 billion and help turn the fiscal tide. But if you want to know how exactly that works you’re on your own.

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2 responses to “Morgan Stanley Finally Owns Up to All the Trouble It Caused; It’s a Darn Claim Unemployment Filings Are Up; Sears is Losing It

  1. Poor Sears! They used to be a great place – and I remember the “Come see the softer side of Sears” campaign and that seemed to really give them a boost… but, you’re right, it’s been so many years… How do you let such a brand name go?

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