A day after reports the FDIC is going on a hiring spree, the NYT says small and midsize banks are beginning to face bigger problems from the credit crisis, a story it puts inside on C3. Commercial real estate problems are particularly worrisome for these banks, whose loans-to-capital ratio in that sector more than doubled in the last six years.
The Times quotes unnamed analysts who say as many as fifty such banks could go under in the next year or so.
The WSJ says House Democrats are going after $18 billion in tax breaks for oil and gas companies in an election-year maneuver to tap voter anger over high gas prices and energy-company profits. The paper says the bill has little chance of passing.
The Dems are also stiffening in the battle for royalties on Gulf-of-Mexico drilling leases from the 1990s, something that could be worth up to $31 billion.
The NYT and WSJ report that workers went on strike at a company that makes parts for General Motors. American Axle has stockpiled parts, but if the strike drags on it could affect GM’s profitable truck business. The United Auto Workers says the company wants to slash wages as much as $14 an hour and eliminate other benefits, while the company says its all-in wages average $70 an hour, a number it wants to get down to $27.
The workers agreed four years ago to wage freezes and other labor concessions, says The Detroit News, which provides our Quote of the Day:
“Considering all that we’ve already agreed to, this is a kick in the teeth,” said plant worker Robyn Hudgins. “I can barely afford to live on my street and Mr. Dauch can afford to name one after himself,” she said, referring to American Axle Chairman Richard Dauch.
The FT reports on the front of its Companies & Markets section that a measure of Google’s ad clicks edged down in January from a year ago. It and the WSJ suggest this is evidence that consumers aren’t shopping as much these days, and tie that to the fact that Google stock tanked to its lowest point since May.
The WSJ’s hallowed page one has gotten awful newsy since Rupert Murdoch’s takeover, and that’s on full, unfortunate display today. Why would the WSJ front a news story about the New York Philharmonic getting a standing ovation in Pyongyang?
We’re sitting on our hands on this one. This story would’ve been better played on A3, if that.
The placement follows the FT’s inexplicable decision yesterday to front news that Eric Clapton would play a concert in the Hermit Kingdom.
That might be a questionable cover for Billboard, people.
Opening Bell is your guide to the top business stories of the day, but I can’t read everything out there. It’s 3 a.m., for Pete’s sake! If you’re an editor or reader who sees good work in local or regional papers—anything besides the WSJ, FT, NYT, and Bloomberg—send it my way at firstname.lastname@example.org. )