Monday’s Mayhem – $50 Billion Scammed – Job Cuts at Northern Trust (12/15/08)

Mike: Besides the auto bailout, the Madoff caper is the big news story fot he day. This story has many twists and turns and it will unwind on a daily basis. To me the most shocking part is the almost complete lack of regulatory control over these investment empires. The $50 billion dollars that this charade has cost its investors, not very bright investors it seems, could bailout most state budgets in the US that are now in deficit. so this isn’t chump change especially to the investors who were chumped. This could be the scam that brings down a house of cards which houses many more billions in lost assets. I’ll link to a couple of stories:

 

Bernard Madoff’s incineration of $50 billion is staggering, but perhaps only slightly more than the failure of the Securities and Exchange Commission investigation that found nothing remarkable about Madoff’s operations last year.

And people outside the regulatory community certainly had their doubts.  The Chron quotes a principal of hedge fund consultant Aksia, which looked into Madoff last year. Aksia found Madoff’s returns so anomalously smooth that the only explanation was a Ponzi scheme. 

via SF Financial Fraud Examiner: Madoff Ponzi scam raises 50 billion questions about the regulators.

 

Dec. 15 (Bloomberg) — From a Massachusetts charity that sends teenagers to Israel to the Manhattan theater that introduced “Hair” in 1967, nonprofits around the nation are bracing for fallout following the arrest of New York money manager Bernard Madoff.

The 70-year-old Madoff, whom the Securities and Exchange Commission accused of operating a Ponzi scheme, managed money for the foundations of wealthy philanthropists such as Avram J. Goldberg, the founder of the Stop & Shop supermarket chain, New York Mets owner Fred Wilpon and clothier Carl Shapiro, according to tax returns.

via Bloomberg.com: Arts and Culture.

 

LONDON, England (CNN) — Some of the biggest names in global finance say they have lost hundreds of millions of dollars in an alleged $50 billion “pyramid scheme” that led to the arrest of a New York financier last week.

The New York building that houses Bernard L. Madoff Investment.

The Royal Bank of Scotland told CNN its hedge funds had exposure of up to £400 million ($600 million) to funds managed by securities broker Bernard Madoff.

France’s BNP Paribas said Sunday its maximum potential loss was about €350 million euros ($468 million).

via Banks face huge losses from $50B ‘scam’ – CNN.com.

Mike: The fallout from Madoff is going to be far reaching:

More victims of Bernard L. Madoff Investment Securities continue to emerge on Monday. The JEHT Foundation, a charity that supports reform of the criminal and juvenile justice systems, said that it would stop making grants and close its doors next month because its donors, Jeanne Levy-Church and Kenneth Levy-Church, were investors in the Madoff firm.

via Madoff Scandal Forces JEHT Foundations Closure – Mergers, Acquisitions, Venture Capital, Hedge Funds — DealBook – New York Times.

Mike: Now onto today’s job losses:

 

(Reuters) – Northern Trust Corp said it plans to cut about 450 jobs in 2009, and take related charges.

The company, which provides private banking, investment management and global custody services, said it expects to take a pretax charge of about $20 million to $25 million, or 5 cents to 7 cents a share, in the fourth quarter related to the cuts and other costs.

via Northern Trust to cut about 450 jobs in 2009 | Reuters .

LOS ANGELES—Wildfire season destroyed hundreds of homes this year, but the state’s budget deficit is forcing cuts to firefighters.

Cal Fire is issuing layoffs in San Diego, Riverside and San Bernardino Counties on Monday and a station in Corona will be closed in an effort to save the state $6.3 million.

via Layoffs: Cal Fire to reduce staffing in 3 counties – San Jose Mercury News.

Yonkers, NY – Facing what he called one of the toughest challenges of his administration, Yonkers Mayor Phil Amicone has announced numerous program and service cuts along with a six percent workforce reduction that will see 150 full- and part-time city workers lose their jobs as part of an effort to close a projected $16 million budget deficit for the current fiscal year.

via Westchester.com – Yonkers Announces Layoffs And Budget Cuts.

STOCKHOLM, Sweden — Swedish appliance maker Electrolux AB Monday said it will lay off more than 3,000 staff globally because of a slump in the market.

Electrolux spokesman Anders Edholm said the layoffs represent around five per cent of the company’s total work force of 57,000.

Edholm said demand in both Europe and North America has been declining for some time and fell sharply in the second half of November and in December.

via The Canadian Press: Electrolux cuts 3,000 jobs worldwide.

NEW YORK – Publicis Groupe’s digital unit, Digitas, is laying off 2% of its 2,100 US employees in a restructuring effort. Employees were informed of the decision on Wednesday.

via Digitas lays off 2% of its US workforce – Brand Republic News – Brand Republic.

Mike: NY won’t be the last state to attempt to raise taxes toc lose ever widening budget deficits:

ALBANY — Gov. David A. Paterson will propose a $4 billion package of taxes and fees on a range of items, from sugary soft drinks made by Coca-Cola and Pepsi to luxury items like furs and boats, when he unveils his plan to close a deficit that has ballooned to $15 billion, people with knowledge of the plan said on Sunday.

via Taxes and Fees to Rise $4 Billion in New York Budget – NYTimes.com.

Wisconsin’s projected $5.4 billion budget shortfall would at least double the number of unfilled state jobs if Wisconsin doesn’t get financial help from Washington, Gov. Jim Doyle told federal lawmakers last week.

via WISCONSIN STATE JOURNAL.

Mike: The foreclosure crises will only deepen as jobs are lost:

Unemployment is now the cause of almost half of all foreclosures on conventional mortgages, raising concerns that mounting joblessness will stall any housing recovery and could cause more foreclosures next year.

The increase in unemployment as a cause is a significant shift from 2007, when foreclosures were primarily driven by the large number of homeowners who had taken on risky loans. Many were first-time home buyers or those who bought during the housing boom that ended in 2006.

Job cuts adding to growing number of housing defaults

Mike: An excellent writer of all things foreclosure is Mr. Mortgage at:  http://mrmortgage.ml-implode.com/

Isurf news has learned that a international manufacturing corporation, Ahlstrom, is involved in a world wide layoff of thousands of it’s employees, including many at it’s Madisonville, Kentucky Facility in Hopkins Co.

via Madisonville – Hopkins County KY Free Local Community News | 

LAKEWOOD — Officials for Kimball Medical Center confirmed today the hospital administration will layoff another 10 employees.

via UPDATE: Hospital official confirms more layoffs planned | APP.com | Asbury Park Press.

The downturn in the national economy hits home. On Monday, officials with Cliffs Natural Resources Inc. laid off about 100 miners. The company operates two mines in near Pineville in Wyoming County, but bad economy or not residents of the coalfields know all too well the boom and bust of the industry. 

via WVPubcast News . Audio:  Listen Now (4:34)

NEW YORK (MarketWatch) — The Charles Schwab Corp (SCHW) said on Monday that its clients daily average trades were 408,000 in November 2008, up 18% from November 2007 and down 18% from October 2008. Net new assets brought to the company by new and existing clients in November 2008 totaled $5.9 billion, the firm said. It added that it plans to cut 100 jobs, “mostly at the officer level – and to result in severance charges totaling approximately $20 million pre-tax in the fourth quarter of 2008.” It said it will review option to cut costs further, and would include possible further job cuts and lower marketing spending.

via Schwab client trading falls 18% in November, firm cuts jobs – MarketWatch .

Cummins announces layoffs, scales back sales projections

via trucknews.com – Truck News – 12/15/2008.

GREENE – The county’s largest employer will be moving to a four-day work week as an alternative to large scale layoffs, according to a company representative.

“The current economic conditions have caught up with our industry,” said Steve VanNostrand, vice president of human resources for The Raymond Corporation.

via The Evening Sun | Raymond going to a 4-day work week.

RF Micro Devices will cut 150 employees from its Greensboro manufacturing operations in the first quarter of 2009, according to a spokesperson.

via RF Micro to cut employees in 1Q – The Business Journal of the Greater Triad Area: .

Bad news in the sunny Caribbean. Since we’re not booking enough vacations down there, the Sandals Resorts are letting around 650 hotel staff go from their resorts in the Bahamas, Jamaica and St. Lucia.

via Meltdown Cuts 650 Jobs in Sandals Resorts || HotelChatter.

Mike: This bit of bad news portends of job cuts to come

Dec. 15 (Bloomberg) — Manufacturing in New York contracted in December at the fastest pace on record as orders and shipments remained weak.

The Federal Reserve Bank of New York’s general economic index fell to minus 25.8, the lowest level since records began in 2001, from minus 25.4 in November, the bank said today. Readings below zero for the Empire State index signal manufacturing activity is shrinking.

via Bloomberg.com: Worldwide.

MONTPELIER, Vt. (AP) – Pinched by falling revenues, Vermont state officials say they’ll cut $19.7 million from the state budget by laying off up to 35 people, leaving vacant jobs open and closing some highway rest areas.

via Fox 44 – Burlington and Plattsburgh News, Weather and Sports – Fox44.net | State: Up to 35 layoffs possible.

E-commerce fulfillment and technology provider GSI Commerce has cut about 100 positions at its Shepherdsville facility.

The company said the layoffs are a result of losing the business of Linens n’ Things, which earlier this year filed for protection under Chapter 11 of the U.S. Bankruptcy Code.

via GSI commerce cuts jobs, relocates employees – Business First of Louisville: .

Financial services firm J.G. Wentworth has laid off an estimated 120 employees from its Bryn Mawr, Pa. headquarters, according to a notice it is required to send to the Pennsylvania Department of Labor and Industry.

via J.G. Wentworth cuts 120 in Bryn Mawr – Philadelphia Business Journal: .

Atmel also said it will cut its North American workforce by 11% and implement a 10-day shutdown for non-manufacturing employees, among other planned actions to lower its costs.

via Atmel lowers revenue forecast, plans job cuts – MarketWatch .

BIRMINGHAM, Ala. (ABP) — Woman’s Missionary Union has announced budget cutbacks affecting nearly 100 employees of the Southern Baptist Convention women’s auxiliary, founded in 1888.

After consulting with the WMU Executive Board’s finance and personnel committees Dec. 8, WMU Executive Director Wanda Lee informed employees Dec. 10 of budget cuts totaling $1.4 million. To avoid layoffs, cuts were made across the board. They include placing workers on four-week unpaid furloughs between January and August of 2009.

via Associated Baptist Press – WMU budget cuts include worker furlough.

Force Protection is laying off an additional 150 employees as the Department of Defense’s large truck procurement program winds to a close, bringing the company’s total layoffs this year to about 850.

“We’re restructuring the business based on the end of that MRAP program contract,” spokesman Tommy Pruitt said today.

via Charleston Regional Business Journal | Charleston, SC.

MONTPELIER — The Douglas administration released a list of $19.7 million in proposed state budget cuts this morning that includes more than a dozen layoffs, elimination of chiropractic coverage for Medicaid recipients, trimming of college scholarships, closing three rest areas and a host of other items.

via State: More than a dozen layoffs expected | burlingtonfreepress.com | The Burlington Free Press.

TAMPA, Fla. (AP) _ Fewer donations and lagging investments has a state American Red Cross chapter hurting.

A spokeswoman for the charity’s Tampa office says 22 staffers, nearly half the staff, has been laid off. A 23rd position that was currently unfilled was also cut.

via Red Cross Layoffs .

In the wake of mid-year projected budget cuts of $1.9 million, the School Board of Levy County needs to lay off 50 employees, according to Director of Finance Robert Clemons.

“We should have reduced our staff levels by at least 25 at the beginning of this school year,” Clemons wrote in a letter to the Board dated Nov. 26. “Now that half of the year is gone we need to reduce our staff levels by 50 to achieve the same results.”

via Chiefland Citizen News, Sports, Entertainment and information for Chiefland, Florida .

Titan announced earlier this month that it would axe 40 percent of its staff–17 workers–and anticipated further cuts in the weeks ahead. Its primary task now is finding a partner or buyer for Probuphine, which is in late-stage development for opioid addiction.

via Titan execs exit posts in ongoing shakeup – FierceBiotech.

SPRING GROVE, Minn. (AP) – Residents of Spring Grove in southeastern Minnesota are bracing for tough times now that the town’s top employer, Northern Engraving, has announced layoffs.

The company announced late last week that it’s closing its 208-worker plant. The plant makes engraved name plates and trim work, primarily for the auto industry.

via WQOW TV: Eau Claire, WI NEWS18 News, Weather, and Sports-Spring Grove bracing for layoffs at major employer.

The staff of Farrar, Straus & Giroux were informed today that the layoffs many in the company have been expecting since last month are actually happening.

via Observer.com Mobile: Severe Layoffs at Farrar, Straus & Giroux; Associate Publisher Linda Rosenberg and Head of Production Tom Consiglio Both Out.

Sonus Networks Inc. (SONS), which makes infrastructure for IP networks, is cutting 50 jobs by the end of this year (or, over the next two weeks).

via Sonus Chops 50 Jobs.

Hands-On Mobile, the San Francisco-based mobile game maker known for Guitar Hero and Texas Hold ‘Em, confirmed today that it cut an undisclosed number of employees. CEO David White declined to say how many people were affected during the cuts, or how many employees the company will have going forward.

via mocoNews.net – Hands-On Mobile Lays Off Undisclosed Number Of Employees – washingtonpost.com.

SAN FRANCISCO (MarketWatch) — Bank of America Corp. has laid off about 20 high-ranking executives last week, including some longtime supporters of Chief Executive Officer Kenneth Lewis, the Wall Street Journal reported Monday on its Web site.

via BofA lays off about 20 high-ranking executives: WSJ – MarketWatch .

While DHL’s decision to scale back its U.S. operations will affect another Ohio area – Wilmington – more severely, the Cleveland area can also now expect some cutbacks. DHL Express said that it will now end as many as 230 jobs in Strongsville and Beachwood beginning January 23.

via DHL Job Cuts Come to Cleveland Area | Cleveland Leader.

Giles County is beginning to feel the effects of a worsening economy. Giles County Register of Deeds Kay Gibbons was recently forced to layoff two employees from her office. The layoffs were directly related to the slow down in the sales of property in Giles County.

via WKSR.com.

More than 300 Citation employees will be permanently laid off in February, according to a letter to employees issued last week.

In a Dec. 12 letter provided to The Lufkin Daily News, workers were notified the plant will close Feb. 27 due to “economic reasons.”

Five to 10 employees may be retained after that date, but the company anticipates releasing about 322 employees beginning Feb. 15 and extending through Feb. 27, the letter stated.

via 11:05 A.M. UPDATE: More than 300 Citation layoffs to take effect in February.

Mike: This Toyota story may not be a layoff, but it’s bad news for those who were hoping to work there in the near future:

DETROIT (Reuters) – Toyota Motor Corp is suspending work on a new plant in Mississippi indefinitely in response to a “steep decline” in U.S. industrywide auto sales, the automaker said on Monday.

Toyota’s Mississippi plant was slated to produce its Prius hybrids beginning in late 2010.

via Toyota suspends work on new U.S. plant.

Continental will close its diesel fuel injection plant in Blythewood at the end of 2010 as its work is transferred to a plant in Virginia, the company announced today.

The eight-year-old, 221,750-square-foot plant employs 440 people.

via 440-employee plant closing in S.C. – Breaking News | CharlotteObserver.com.

CASCADE, Iowa — As the slowdown in the housing and construction industries continues, Cascade Manufacturing Co. plans to close its Eldridge plant, laying off 23 workers.

via TH – Local News Article.

The IMI Cornelius Equipco Inc facility, located at 1181 North 6th Street by Farmland Foods, is closing. The business manufactures fountain dispensing machines for Coke and Pepsi. Don Gifford, Equipco’s general manger, says Coca-Cola Foodservice North America plans to consolidate all of its remanufacturing business with Lancer Corporation. San Antonio, Texas based Lancer is a manufacturer and marketer of beverage dispensing systems to customers around the world.

via Galesburg Radio 14…WGIL.

TVNewser has confirmed two more on-air talent leaving CNN: Headline News anchor Linda Stouffer (pictured) and longtime CNN correspondent Rusty Dornin.

via Linda Stouffer and Rusty Dornin Out at CNN – mediabistro.com: TVNewser.

Coral Gables-based BankUnited Financial Corp. filed a notice with the state on Dec. 12 that it would lay off 10 employees.

The employees, who work in Miami, Miami Lakes, Parkland and Tequesta, were notified on Dec. 11 that they would be let go.

via More layoffs at BankUnited – South Florida Business Journal: .

Univ. of Toledo lays off temporary workers

Dr. Lloyd Jacobs, president of the University of Toledo, announced some layoffs today.

More than 100 temporary workers will be laid off. Not everyone has been informed, so specifics aren’t being released.

via UT announces layoffs – 12/15/08 – Toledo News – 13abc.com.

Thirty-six workers at the Intermet plant in Monroe City were laid off Monday.

No reductions are scheduled at the company’s Palmyra facility, but a longer holiday shutdown is planned there.

A spokesman said the layoffs are the result of a drop in demand for metal auto parts made at both facilities, but wouldn’t say if more job reductions are planned.

via Monroe City Intermet layoffs take effect – Hannibal, MO – Hannibal Courier-Post.

A number of employees at SI Bank & Trust received notices today that their jobs are being terminated.

via Layoffs hit SI Bank & Trust – Staten Island Real-Time News – SILive.com.

Watlow has laid off six Hannibal workers and moved 17 others from desk jobs to manufacturing.

The St. Louis-based company blamed a fourth-quarter decline in sales and said the downturn is expected to continue next year.

via Hannibal Watlow reduces workforce slightly – Hannibal, MO – Hannibal Courier-Post.

Macmillan Publishing has eliminated 64 positions across both its college and trade imprints as well as Scientific American magazine.

via Macmillan Eliminates 64 Positions; Forms Children’s Group   – 12/15/2008 12:13:00 PM – Publishers Weekly.

A hospital in Klamath Falls is the latest Oregon employer to lay off workers.

Sky Lakes  Medical Center says it has already laid off more than 12 workers and is working to trim the equivalent of 60 full-time employees between Monday and February. Ethan Lindsey reports.

via OPB News · Klamath Falls Hospital Lays Off Workers.

Despite earlier statements that it hoped it had cut all the jobs it planned to, Fleetwood Enterprises Inc. has cut another 250 jobs from its Decatur operations.

via Fleetwood cuts 250 from Decatur workforce | The Journal Gazette.

GRAND RAPIDS — About 50 Grand Rapids secondary school teachers can expect layoff notices this month as district leaders say they are bracing for economic uncertainty.

via Grand Rapids schools announce layoffs for 50 teachers – Grand Rapids News – The Grand Rapids Press Online – Michigan Newspaper – MLive.com

Bank of America will eliminate 165 customer service positions in Chandler next year as part of the bank’s massive consolidation efforts following its January acquisition of collapsed mortgage firm Countrywide Financial Corp.

via 165 Chandler jobs to be eliminated in Bank of America consolidation – Phoenix Business Journal: .

The Pioneer Press is reporting that nearly 4,000 Best Buy employees at its corporate headquarters in Richfield were offered buyouts today. A spokeswoman said the program is voluntary, and workers have until Jan. 5 to decide. No layoffs have been announced.

Report: Best Buy offers buyouts to 4,000 employees

The national economic downturn hit home for 42 employees of Trail King Industries who were laid off Monday in Mitchell.

Trail King lays off 42 employees

The top employer in Spring Grove, Minn., is laying off 208 workers, according to media reports.

via Northern Engraving will idle plant, lay off 208 – Minneapolis / St. Paul Business Journal: 

Mike: Battered Indiana takes another hit:

Deflect-O Corp., a manufacturing company that specializes in functional workplace and home items, plans to permanently close in February, laying off 219 workers in Central Indiana.

Deflect-O, whose headquarters is in Fishers, makes office and hardware products, mostly from plastic. Its products range from decorative chair mats to dryer vent extensions known as “Hooker-Upper! Protectors.”

via Deflect-O closing; 219 in Indy, Fishers to lose jobs | IndyStar.com | The Indianapolis Star .

The country’s economic woes could lead to job cuts for Beech Grove city employees.

Mayor Joe Wright announced in a news release today that there will be a 5- to 10-percent reduction in the city’s workforce next year.

via Beech Grove plans workforce cuts in ’09 | IndyStar.com | The Indianapolis Star .

Mike: Some good news on the job front for battered Indiana:

SHELBYVILLE, Ind., Dec 15, 2008 /PRNewswire via COMTEX/ — On the heels of the nation’s official “R-word” status and nightly news reports about stock plummets, plant closings, layoffs and the state’s now record unemployment rate, there’s great news coming out of Shelby County, Indiana. More than 350 new jobs are opening up soon at the closest casino to Indianapolis.

via 350 New Jobs Open Up at Indiana Live Casino – MarketWatch .

Mike: A good article from Business Week about how the “official” unemployment numbers don’t reflect actual unemployment:

As U.S. jobs disappear at a rapid clip, the official unemployment figure seems understated. While November’s 6.7% rate is a full 2% higher than the same time last year, the rate remains well below the 10.8% postwar peak, reached in November 1982. One issue is that the official unemployment number captures only a slice of the total joblessness in the U.S. To be counted as unemployed in this statistic, a worker must not have a job, be currently available for work, and have actively sought employment within the last four weeks. In other words, a lot of the jobless are left out of the government’s tally.

via Unemployment: Worse Than it Looks – BusinessWeek.

Mike: We are in a worldwide recession and China won’t be any exception to job loss carnage. The Chinese may not be as peaceful as most US citizens are about job loss, since there is little in the way of unemployment insurance or other social welfare benefits. The Chinese will shake things up with mass protests and sit-ins, which could make Tiananmen Square look like a minor disturbance:

BEIJING, Dec 15 (Bernama) — President Hu Jintao said China’s unemployment will be “very serious” next year and that maintaining social stability was very important as the country battles the global economic crisis.

“Our top economic target next year is to maintain a stable and healthy growth,” the Chinese leader was quoted as saying by the official Xinhua News Agency during a three-day visit to northeastern Liaoning province from Friday to Sunday.

via Malaysian National News Agency ~ BERNAMA.

Mike: For further information about Tiananmen Square: http://en.wikipedia.org/wiki/Tiananmen_Square_protests_of_1989

SEATTLE — Inside one of Seattle’s fastest-growing businesses, phone lines hum with 6,000 calls a week, 20 new employees a month train in a converted classroom and economic projections indicate a continued expansion and additional backlog of customers.

How unfortunate, employee Candy Wetmore thinks. How sad.

But this is the nature of the state Employment Security Department’s call center.

via HeraldNet: Growth industry in state? Jobless-benefits call centers.

Mike: The National Association of Home Builders/Wells Fargo housing market index is a key indicator of housing construction. As long as this level remains depressed, housing construction employment will continue to dscline:

LOS ANGELES (AP) — A key gauge of homebuilders’ confidence remained at a record low this month, as builders continued to be overwhelmingly discouraged in the prospects of a housing turnaround amid a worsening U.S. economy and rising unemployment and foreclosures.

The National Association of Home Builders/Wells Fargo housing market index held at nine in December for the second month in a row.

via Homebuilder sentiment index remains at record low – Yahoo! Finance.

Mike: A 60 minutes video that shows the continuing deterioration of the housing market:

Vodpod videos no longer available.

more about “The Mortgage Meltdown Video – CBSNews…“, posted with vodpod

 

Mike: I’ll add more announcements as they are released, but let’s have a bit of humor about our current state of affairs:

Matt Bors - Dec. 15

Matt Bors - Dec. 15

 

 

 

 

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