Connect with us

Business

A tale of two suboptimal paths: the LIC way or the Air India method

T N Ninan says that one approach waits for the corporation to go bankrupt, while the other continues to submit it to government whim.

Published

on

ironity13
Photo: Shutterstock

Consider two recent government sales: wholesale Air India to the Tata company and retail shares in the Life Insurance Corporation (LIC). The LIC offer price was a fraction of what private sector competitors were valued at (typically, in relation to what is called “embedded value”).

Despite this, its stock has declined since its IPO, a trend that has plagued government enterprises in the past, such as Coal India. Unlike LIC, which is still 96.5 percent government-owned, Air India has been entirely privatised. A previous offer to sell was accepted while the th

Business

Cramer’s lightning round: AGNC Investment is not a buy

Published

on

By

103507374-104044814.jpg


Paramount Global: “Too cheap to believe. … I don’t know where it bottoms, but it sure isn’t close to the top.”

Hasbro Inc: “I don’t like the earnings, and I think that Mattel‘s actually cheaper.”

Advertisement

Citigroup Inc: “The book value is so different from where the common stock is, the price. Something is very wrong there.”

Cramer's lightning round: AGNC Investment is not a buy

Jim Cramer’s Guide to Investing

Click here to download Jim Cramer’s Guide to Investing at no cost to help you build long-term wealth and invest smarter.



Source link

Continue Reading

Business

Jim Cramer says not to fear bearish economic talk from bank CEOs – there’s no ‘financial apocalypse’

Published

on

By

107059906-1652323139311-200222_IMG_7979.jpg


Jim Cramer says not to fear bearish economic talk from bank CEOs
CNBC’s Jim Cramer on Wednesday told investors that they should take gloomy economic commentary from bank executives with a grain of salt. 

“Don’t panic the next time you hear one of these bank CEOs say something terrifying — they don’t know the impact of their words,” he said, adding, “Sure, we’ve got plenty of problems, but they’re not financial apocalypse problems.”

The S&P 500 slipped for a fifth trading session on Wednesday as investors mulled the possibility of a recession.

Advertisement

Adding to investors’ worries, JPMorgan Chase CEO Jamie Dimon said on Tuesday that inflation is eating away at consumers’ pocketbooks and could create a recession. 

The chief executives of Bank of America and Wells Fargo also warned that the economy is slowing down as Americans cut back on spending.

“Memo to America’s bankers: Don’t try to frighten us. Don’t try to get us to sell everything,” Cramer said. “Don’t be Grinches telling us a hurricane could be coming.”

He urged the chief executives to remind investors of what’s going right in the Fed’s fight against inflation, and gave an example of what he believes one of the CEOs should have said: 

“There will come a day when the Fed will be done tightening, although that may be when the S&P 500 is a good bit lower. But I don’t know if I want to take the chance of possibly missing the [next] big rally. Hey, maybe buy small,” he said.

Advertisement

Disclaimer: Cramer’s Charitable Trust owns shares of Wells Fargo.

Watch Jim Cramer's message to U.S. bank leaders

Jim Cramer’s Guide to Investing

Click here to download Jim Cramer’s Guide to Investing at no cost to help you build long-term wealth and invest smarter.



Source link

Continue Reading

Business

Mortgage demand falls again even as rates sink further

Published

on

By

107162211-1670370490991-gettyimages-1245416106-US_HOUSING_MARKET.jpeg


A “For Sale” sign in front of a home in Sacramento, California, on Monday, Dec. 5, 2022.

David Paul Morris | Bloomberg | Getty Images

Advertisement
Lower mortgage rates are pulling some current homeowners back to the refinance market, but not enough to offset the drop in demand from homebuyers.

Mortgage application volume fell 1.9% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) decreased to 6.41% from 6.49%, with points decreasing to 0.63 from 0.68 (including the origination fee) for loans with a 20% down payment. That is 73 basis points lower than it was a month ago but still more than three full percentage points higher than it was a year ago.

Applications to refinance a home loan rose 5% for the week but were still 86% lower than the same week one year ago. There are still precious few current borrowers who can benefit from a refinance at today’s higher interest rates. The refinance share of mortgage activity increased to 28.7% of total applications from 26.1% the previous week.

Housing has a fair amount of room to fall, says Morgan Stanley's Egan

Mortgage applications to purchase a home fell 3% for the week and were 40% lower than the same week one year ago.

“Purchase activity slowed last week, with a drop in conventional purchase applications partially offset by an increase in FHA and USDA loan applications,” noted Joel Kan, an MBA economist in a release.

Advertisement

The average loan size for homebuyer applications decreased to $387,300 — its lowest level since January 2021, which is consistent with slightly stronger government applications and a rapidly cooling home-price environment, according to Kan.

Mortgage rates haven’t moved much this week, with no significant economic news making headlines. The next big shift will likely come next week, with the much-anticipated monthly read on inflation.



Source link

Advertisement
Continue Reading

Trending