Posted on 07/11/2009 11:13:13 AM PDT by rabscuttle385
NEW YORK (Dow Jones)--Concerns about the creditworthiness of CIT Group Inc. (CIT) are seeping into broader markets after the commercial lender Friday confirmed that the U.S. Federal Deposit Insurance Corp. has yet to approve its application to issue government-backed debt.
The worries about the lender are touching markets from stocks to Treasurys, underscoring how broader credit concerns may be resurfacing after a period of relative calm.
Shares of CIT were off nearly 30% Friday before closing down 18%, while most CIT bonds fell, indicating worries about the lender's ability to meet its obligations in the long run. Treasury prices, meanwhile, gained on increased risk aversion.
If CIT is "not able to lend, small businesses can't borrow, which could lead to failure," said James Newman, head of U.S. government and agency trading at Keefe, Bruyette & Woods. "They also have a big chunk of corporate bond debt outstanding which would not be good for the credit markets, leading to the flight-to-quality bid in Treasurys."
(Excerpt) Read more at online.wsj.com ...
Small businesses will be squeezed even more. They will not be able to borrow, and they will be taxed until they break. Plus, the minimum wage is going later this month. What are the chances of any job creation from this big portion of our economy?
As with the rest, we should have allowed those assholes to go bankrupt on their own last year! Instead, after many months, and tens of billions of tax dollars later, the end result is still the same!!
I expect this will also happened to many more of those ‘too big to fail’ banks and corporations.
There should be a revolt over all of this!!!
but Obama said stimulus is working
Obama is an idiot.
But, but, but - what about all the green shoots?
Here’s another excellent WSJ piece on the CIT crisis:
http://online.wsj.com/article/SB124726664858925543.html
The vast majority of the American public continues footing the bill via excessive higher taxes and fees -- billions worth for Obama Inc's 'stimulus' racket.
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