Google won hands down when it comes to Americans watching videos online. Stats showed that Internet users in the U.S. watched 12.7 billion online videos in November, a 34% increase from a year ago. Numbers studied by market researcher ComScore hailed a huge ‘thank you’ to YouTube when Google sites earned top billing with nearly 5.1 billion videos viewed (40% of all videos seen). The YouTube/Google sharing site accounted for 98% of Google’s traffic. Second was Fox Interactive Media with 439 million videos watched (3.5%); next Viacom Digital with 325 million videos or 2.6%. Data reported that in 2008, in the U.S., 77% of Internet users viewed online videos. Projected numbers show the market will grow another 45% equaling around $850 million this year.
Bank of America (BAC.N) posted its first quarterly loss in 17 years. The announcement came on the heels of news that the government will fund what is now the largest bank in the U.S. Bank of America purchased a sinking Merrill Lynch earlier in the year. Reports say the U.S. Treasury will provide financial help in exchange for preferred stock in the bank. The Federal Reserve and Federal Deposit Insurance Corp also agreed to protect Bank of America from possible losses on $118 billion of assets.
The German billionaire Adolf Merckle, whose over speculation in Volkswagen stock forced his massive business empire to the brink of financial ruin, ended his misery by committing suicide, his family reported. The 74-year old who for weeks was said to be emotionally unable to handle his crumbling business was found dead near his estate in the southern German hamlet of Blaubeuren, on a railroad track. Officials from the city stated that no other persons were involved. A suicide note had been found, but its contents were not relased by the family.
The nation’s No. 2 electronics retailer Circuit City will close all 567 stores and sell its assets as it restructures under Chapter 11 bankruptcy protection. Creditors agreed to the shutdown after two potential buyers seeking to continue operating the company backed out of negotiations.
Private investors will buy what is left of IndyMac Bank, a California mortgage lender whose July financial failure set the autumn crisis of the financial system. This will be the first failed bank in two decades sold to a buyer outside the banking industry by the Federal Deposit Insurance Corp. The investing group, IMB HoldCo, is led by Steven Mnuchin, a former Goldman Sachs executive, and includes the veteran banking investor J. Christopher Flowers, computer maker Michael S. Dell and the hedge fund manager John Paulson. IndyMac now has a total value to the government of more than $13.9 billion; new investors will remove most liabilities from the governments books, and then they will pay the additional cash needed to cover the balance due.
United States consumer prices barely rose last year—their slowest pace in more than a half century, a new government report stated; then a stunning turn just a few months later when inflation hit an all time 17-year high.
Much of the reversal was due to a roughly 75% decline in the oil prices from their July peak that now have brought prices down on everything from gasoline and home heating to airline fares. But some of the inflation’s disappearance that has been reported is also a consequence of the severe economic recession hitting the nation and that is causing nervous households to delay spending money, adding to the leg long list of companies going out of business.
After a $8.3 billion fourth-quarter loss, Citigroup will reorganize the company into two businesses. Citicorp will soon operate as a traditional banking business, and a separate business, Citi Holdings, a company to work with risky assets. Fourth-quarter losses amounted to $1.72 per share compared to a year ago of $1.99 loss per share. The losses totaled $9.8 billion. The 2008 fourth quarter included a $3.9 billion gain on the sale of its German retail bank.
Fourth-quarter revenue dropped 13% to $5.6 billion. Months ago Citigroup had announced that it would cut its banking work force of about 323,000 to 52,000 workers.
President Barack Obama told House Speaker Nancy Pelosi that he favors a price tag of some where in the area of $775 billion for the U.S. economic stimulus plan, a Democratic aide said. Obama met with congressional leaders from both parties at the Capitol to help craft and shore up support for a two-year plan he hopes will boost the sagging economy. He said that the plan would cut taxes for individuals and businesses and allow money for government programs that will help rebuild the nation’s infrastructure. “We have to act now to address this crisis and break the momentum of the recession, or the next few years could be dramatically worse,” Obama had told the reporters.
The plan would attempt to boost consumer demand by providing tax breaks worth $500 for individuals and $1,000 for couples. By altering tax-withholding rules, workers would see an immediate increase in their take-home pay. Cutting the payroll tax “would be more efficient” in helping the economy, Michael Darda, chief economist for MKM Partners LP, said on Bloomberg Television, but also cautioned that “there is no silver bullet.”
The impact of Russia’s natural gas embargo against Ukraine spread to several Eastern European countries, as a senior Ukrainian official warned of serious fuel disruptions across the continent in as little as 10 days if Russia refused to resume shipments.
Poland, Romania, Bulgaria and Hungary reported drops in the gas they receive from Russia via Ukrainian pipelines but said consumers had not yet been affected because of reserve supplies and additional Russian deliveries through other countries.
The European Union which gets a quarter of its gas from Russia, most of it through pipelines that cross Ukraine, said that it planned to call an emergency meeting to discuss the crisis and urged “an immediate resumption of full gas deliveries” to E.U. member states.
The European Central Bank lowered its benchmark interest rate by more than a half-point to 2 percent, the lowest level ever, and hinted that the rate would fall even further. The bank has halved its main borrowing rate in the last three months, as the outlook for Europe and the global market for its exports continues to darken.
