GE transport unit to cut or furlough 1,550 workers

11-Feb-09
NEW YORK (Reuters) – General Electric Co (GE.N) on Tuesday said it will cut 350 jobs and temporarily furlough 1,200 workers at its locomotive unit as production declines (total 1,550 workers).

http://news.yahoo.com/s/nm/20090211/bs_nm/us_generalelectric_jobs

UBS posts biggest loss in Swiss corporate history - Yahoo! News

ZURICH (Reuters) – UBS (UBSN.VX)(UBS.N) posted the biggest annual loss in Swiss history and said it would cut a further 2,000 investment banking jobs as it looks to rebuild its damaged wealth management brand. The bank had already announced 7,500 job cuts as a result of the crisis.

http://news.yahoo.com/s/nm/20090210/bs_nm/us_ubs_results

GM to cut 10,000 salaried jobs - Yahoo! News

10-Feb-09
DETROIT (Reuters) – General Motors Co (GM.N) will slash its global salaried work force by about 10,000, or 14 percent, this year and impose pay cuts on most remaining white-collar U.S. workers as it scrambles to reduce costs under a restructuring mandated by its U.S. government bailout.

http://news.yahoo.com/s/nm/20090210/bs_nm/us_gm_jobs

The Grateful Dead

"There is a road, no simple highway, between the dawn and the dark of night." -- The Grateful Dead

15 Companies That Might Not Survive 2009 - Yahoo! Finance

15 Companies That Might Not Survive 2009

Rick Newman

Friday February 6, 2009, 11:53 am EST

 

Who's next?

With consumers shutting their wallets and corporate revenues plunging, the business landscape may start to resemble a graveyard in 2009. Household names like Circuit City and Linens 'n Things have already perished. And chances are, those bankruptcies were just an early warning sign of a much broader epidemic.

Moody's Investors Service, for instance, predicts that the default rate on corporate bonds - which foretells bankruptcies - will be three times higher in 2009 than in 2008, and 15 times higher than in 2007. That could equate to 25 significant bankruptcies per month.

We examined ratings from Moody's and data from other sources to develop a short list of potential victims that ought to be familiar to most consumers. Many of these firms are in industries directly hit by the slowdown in consumer spending, such as retail, automotive, housing and entertainment.

But there are other common threads. Most of these firms have limited cash for a rainy day, and a lot of debt, with large interest payments due over the next year. In ordinary times, it might not be so hard to refinance loans, or get new ones, to help keep the cash flowing. But in an acute credit crunch it's a different story, and at companies where sales are down and going lower, skittish lenders may refuse to grant any more credit. It's a terrible time to be cash-poor.

[See how Wall Street continues to doom itself.]

That's why Moody's assigns most of these firms its lowest rating for short-term liquidity. And all the firms on this list have long-term debt that Moody's rates Caa or lower, which means the borrower is considered at least a "very high" credit risk.

Once a company defaults on its debt, or fails to make a payment, the next step is usually a Chapter 11 bankruptcy filing. Some firms continue to operate while in Chapter 11, retaining many of their employees. Those firms often shed debt, restructure, and emerge from bankruptcy as healthier companies.

But it takes fresh financing to do that, and with money scarce, more bankrupt firms than usual are likely to liquidate - like Circuit City. That's why corporate failures are likely to be a major drag on the economy in 2009: In a liquidation, the entire workforce often gets axed, with little or no severance. That will only add to unemployment, which could hit 9 or even 10 percent by the end of the year.

[Want to land a plum job without paying taxes? Here's how.]

It's possible that none of the firms on this list will liquidate, or even declare Chapter 11. Some may come up with unexpected revenue or creative financing that helps avert bankruptcy, while others could be purchased in whole or in part by creditors or other investors. But one way or another, the following 15 firms will probably look a lot different a year from now than they do today:

Rite Aid. (Ticker symbol: RAD; about 100,000 employees; 1-year stock-price decline: 92%). This drugstore chain tried to boost its performance by acquiring competitors Brooks and Eckerd in 2007. But there have been some nasty side effects, like a huge debt load that makes it the most leveraged drugstore chain in the U.S., according to Zacks Equity Research. That big retail investment came just as megadiscounter Wal-Mart was starting to sell prescription drugs, and consumers were starting to cut bank on spending. Management has twice lowered its outlook for 2009. Prognosis: Mounting losses, with no turnaround in sight.

Claire's Stores. (Privately owned; about 18,000 employees.) Leon Black's once-renowned private-equity firm, the Apollo Group, paid $3.1 billion for this trendy teen-focused accessory store in 2007, when buyout funds were bulging. But cash flow has been negative for much of the past year and analysts believe Claire's is close to defaulting on its debt. A horrible retail outlook for 2009 offers no relief, suggesting Claire's could follow Linens 'n Things - another Apollo purchase - and declare Chapter 11, possibly shuttering all of its 3,000-plus stores.

[See 5 pieces missing from Obama's stimulus plan.]

Chrysler. (Privately owned; about 55,000 employees). It's never a good sign when management insists the company is not going out of business, which is what CEO Bob Nardelli has been doing lately. Of the three Detroit automakers, Chrysler is the most endangered, with a product portfolio that's overreliant on gas-guzzling trucks and SUVs and almost totally devoid of compelling small cars. A recent deal with Fiat seems dubious, since the Italian automaker doesn't have to pony up any money, and Chrysler desperately needs cash. The company is quickly burning through $4 billion in government bailout money, and with car sales down 40 percent from recent peaks, Chrysler may be the weakling that can't cut it in tough times.

Dollar Thrifty Automotive Group. (DTG; about 7,000 employees; stock down 95%). This car-rental company is a small player compared to Enterprise, Hertz, and Avis Budget. It's also more reliant on leisure travelers, and therefore more susceptible to a downturn as consumers cut spending. Dollar Thrifty is also closely tied to Chrysler, which supplies 80 percent of its fleet. Moody's predicts that if Chrysler declares Chapter 11, Dollar Thrifty would suffer deeply as well.

Realogy Corp. (Privately owned; about 13,000 employees). It's the biggest real-estate brokerage firm in the country, but that's a bad thing when there are double-digit declines in both sales and prices, as there were in 2009. Realogy, which includes the Coldwell Banker, ERA, and Sotheby's franchises, also carries a high debt load, dating to its purchase by the Apollo Group in 2007 - the very moment when the housing market was starting to invert from a soaring ride into a sickening nosedive. Realogy has been trying to refinance much of its debt, prompting lawsuits. One deal was denied by a judge in December, reducing the firm's already tight wiggle room.

[See why "Wall Street talent" is an oxymoron.]

Station Casinos. (Privately owned, about 14,000 employees). Las Vegas has already been creamed by a biblical real-estate bust, and now it may face the loss of its home-grown gambling joints, too. Station - which runs 15 casinos off the strip that cater to locals - recently failed to make a key interest payment, which is often one of the last steps before a Chapter 11 filing. For once, the house seems likely to lose.

Loehmann's Capital Corp. (Privately owned; about 1,500 employees). This clothing chain has the right formula for lean times, offering women's clothing at discount prices. But the consumer pullback is hitting just about every retailer, and Loehmann's has a lot less cash to ride out a drought than competitors like Nordstrom Rack and TJ Maxx. If Loehmann's doesn't get additional financing in 2009 - a dicey proposition, given skyrocketing unemployment and plunging spending - the chain could run out of cash.

Sbarro. (Privately owned; about 5,500 employees). It's not the pizza that's the problem. Many of this chain's 1,100 storefronts are in malls, which is a double whammy: Traffic is down, since consumers have put away their wallets. Sbarro can't really boost revenue by adding a breakfast or late-night menu, like other chains have done. And competitors like Domino's and Pizza Hut have less debt and stronger cash flow, which could intensify pressure on Sbarro as key debt payments come due in 2009.

Six Flags. (SIX; about 30,000 employees; stock down 84%). This theme-park operator has been losing money for several years, and selling off properties to try to pay down debt and get back into the black. But the ride may end prematurely. Moody's expects cash flow to be negative in 2009, and if consumers aren't spending during the peak summer season, that could imperil the company's ability to pay debts coming due later this year and in 2010.

Blockbuster. (BBI; about 60,000 employees; stock down 57%). The video-rental chain has burned cash while trying to figure out how to maximize fees without alienating customers. Its operating income has started to improve just as consumers are cutting back, even on movies. Video stores in general are under pressure as they compete with cable and Internet operators offering the same titles. A key test of Blockbuster's viability will come when two credit lines expire in August. One possible outcome, according to Valueline, is that investors take the company private and then go public again when market conditions are better.

Krispy Kreme. (KKD; about 4,000 employees; stock down 50%). The donuts might be good, but Krispy Kreme overestimated Americans' appetite - and that's saying something. This chain overexpanded during the donut heyday of the 1990s - taking on a lot of debt - and now requires high volumes to meet expenses and interest payments. The company has cut costs and closed underperforming stores, but still hasn't earned an operating profit in three years. And now that consumers are cutting back on everything, such improvements may fail to offset top-line declines, leading Krispy Kreme to seek some kind of relief from lenders over the next year.

Landry's Restaurants. (LNY; about 17,000 employees; stock down 66%). This restaurant chain, which operates Chart House, Rainforest Café, and other eateries, needs $400 million in new financing to finalize a buyout deal dating to last June. If lenders come through, the company should have enough cash to ride out the recession. But at least two banks have already balked, leading to downgrades of the company's debt and the prospect of a cash-flow crunch.

Sirius Satellite Radio. (SIRI - parent company; about 1,000 employees; stock down 96%). The music rocks, but satellite radio has yet to be profitable, and huge contracts for performers like Howard Stern are looking unsustainable. Sirius is one of two satellite-radio services owned by parent company Sirius XM, which was formed when Sirius and XM merged last year. So far, the merger hasn't generated the savings needed to make the company profitable, and Moody's thinks there's a "high likelihood" that Sirius will fail to repay or refinance its debt in 2009. One outcome could be a takeover, at distressed prices, by other firms active in the satellite business.

Trump Entertainment Resorts Holdings. (TRMP; about 9,500 employees; stock down 94%). The casino company made famous by The Donald has received several extensions on interest payments, while it tries to sell at least one of its Atlantic City properties and pay down a stack of debt. But with casino buyers scarce, competition circling, and gamblers nursing their losses from the recession, Trump Entertainment may face long odds of skirting bankruptcy.

BearingPoint. (BGPT; about 16,000 employees; stock down 21%). This Virginia-based consulting firm, spun out of KPMG in 2001, is struggling to solve its own operating problems. The firm has consistently lost money, revenue has been falling, and management stopped issuing earnings guidance in 2008. Stable government contracts generate about 30 percent of the firm's business, but the firm may sell other divisions to help pay off debt. With a key interest payment due in April, management needs to hustle - or devise its own exit strategy.

- With Carol Hook, Danielle Burton and Stephanie Salmon

http://finance.yahoo.com/news/15-Companies-That-Might-Not-usnews-14279875.html

CWA union members authorize strike against AT&T Mobility

February 6 2009 - 3:15 pm ET | Jeffrey Silva | RCR Wireless News

Communications Workers of America members overwhelmingly voted to authorize a strike on behalf of more than 20,000 unionized AT&T Mobility employees if concerns about compensation, employment and working conditions are not adequately addressed in upcoming negotiations over a new contract.

Nissan to slash 20,000 jobs and sees annual loss

TOKYO (AP) -- Nissan is slashing 20,000 jobs, or 8.5 percent of its global work force, to cope with what Japan's third-largest automaker expects will be its first full year loss in nine years.

http://biz.yahoo.com/ap/090209/as_japan_earns_nissan.html

TSMC will reduce 1000 employees in 2009.

TSMC (Major semiconductor manufacturer in Taiwan) 1/22

Will reduce 1000 employees, 5% of the whole company in 2009.

Quote 9/2/09

You fail only when

you do not strive sufficiently to manifest infinite power.  

As soon as a man loses faith death comes. 

--Swami Vivekananda

Two banks in California, 1 in Georgia are closed

By John Letzing, MarketWatch

Last update: 4:41 p.m. EST Feb. 8, 2009
 

SAN FRANCISCO (MarketWatch) -- Regulators shut two banks in California and one in the Atlanta area on Friday, bringing the number of U.S. failures this year to nine, while marking the 34th collapse since the recession began.

FirstBank Financial Services, (FBFS 0.05, +0.03, +150.0%) McDonough, Ga., Alliance Bank of Culver City, Calif., and County Bank, Merced, Calif., were seized, according to the Federal Deposit Insurance Corp.

http://www.marketwatch.com/news/story/story.aspx?guid={0ADB4918-43F9-46A3-8EDD-19A2503A81B3}&siteid=YAHOOB

The Road to Bank Nationalization -- Seeking Alpha

February 08, 2009 | about stocks: BAC / C / XLF    

Last week, seven major corporations announced major layoffs, adding 72,000 to the unemployed. At the same time, lending by the big banks fell. With falling demand for loans, it is little wonder that President Obama described the national economic situation as "worsening day by day." Clearly, we are heading into a deepening and severe recession that is spreading worldwide.

http://seekingalpha.com/article/119172-the-road-to-bank-nationalization?source=email

Emerson to cut up to 14,000 jobs - Yahoo! News

NEW YORK (Reuters) – Industrial conglomerate Emerson Electric Co (EMR.N) could cut its workforce by up to 14,000 from current levels by the end of the fiscal year that ends in October, Emerson Chief Executive David Farr told an investor meeting on Friday.
http://news.yahoo.com/s/nm/20090206/bs_nm/us_emerson_jobs

U.S. January job losses worst in 34 years - Yahoo! News

WASHINGTON (Reuters) – U.S. employers slashed 598,000 jobs in January, the deepest cut in payrolls in 34 years as the national unemployment rate shot up to 7.6 percent, according to a Labor Department report on Friday that underlined a deepening recession.

January's job losses were worse than the 525,000 that had been forecast by Wall Street economists, who also had expected the unemployment rate to come in lower at 7.5 percent. The bleak employment data is certain to be cited by the Obama administration as a fresh reason for Congress to speed up debate over a multibillion-dollar package of proposals to try to stimulate economic activity.

Last month's job reductions were the largest since 602,000 in December 1974, while the jobless rate reached its highest level in more than 16 years.

http://news.yahoo.com/s/nm/20090206/bs_nm/us_usa_economy_jobs

Cisco outlook misses expectations; cuts jobs - CIOL News Reports

NEW YORK, USA:  Cisco Systems Inc Chief Executive John Chambers forecast revenue will drop far more sharply in the current quarter than Wall Street expected, and said the network equipment maker is cutting up to 2,000 jobs.

http://www.ciol.com//Global-News/News-Reports/Cisco-outlook-misses-expectations%3B-cuts-jobs/5209115600/0/

Panasonic to Eliminate 15,000 Jobs, Forecasts Loss

Feb. 4 (Bloomberg) -- Panasonic Corp., the world’s largest consumer-electronics maker, will cut about 15,000 jobs and predicted its first loss in six years as the deepening recession hurts demand for televisions and cameras.

http://www.bloomberg.com/apps/news?pid=20601080&sid=abk2Uos3eZyw&refer=asia

Bill Gates warns of tough economy

Bill Gates warns of tough economy

He foresees another 'three to four years' years of tough economy

David Lawsky

Thursday, February 05, 2009

LONG BEACH,USA: Microsoft Corp founder Bill Gates foresees another three-to-four "very tough" years for the U.S. economy.

http://www.ciol.com//Global-News/News-Reports/Bill-Gates-warns-of-tough-economy/5209115593/0/

Liz Claiborne to cut 725 jobs, or 8% of workforce

By MarketWatch

Last update: 7:56 p.m. EST Feb. 3, 2009

CHICAGO (MarketWatch) -- Apparel designer and retailer Liz Claiborne Inc. said Tuesday it would eliminate 725 jobs, or 8% of its U.S. workforce, in response to what it called a "challenging retail and economic environment."

http://www.marketwatch.com/news/story/story.aspx?guid={5AFF7720-C26D-4B56-BD9A-05B75E336C23}&siteid=YAHOOB

After Layoffs, There's Survivor's Guilt - Yahoo! News

If your company has just gone through layoffs and you didn't lose your job, you might feel relieved. Or you might feel so horrible you almost wish you didn't work there anymore, either.

It's been a brutal week at work, with U.S. companies - like Caterpillar, Boeing, Sprint Nextel and Target - cutting more than 80,000 jobs all told. Losing your paycheck in a recession is certainly awful, and those that hold onto their jobs are no doubt better off than their fallen colleagues. But coming into the office and watching colleagues pack their things and go - being filled with guilt that it wasn't you, anxiety that you might be next, exhaustion from the extra work you now must take on, even envy that certain people get to leave such a sullen environment - that's not much of a cause for celebration either.

http://news.yahoo.com/s/time/20090202/us_time/08599187459200

PNC Financial swings to 4Q loss, plans job cuts - Yahoo! Finance

CHARLOTTE, N.C. (AP) -- PNC Financial Services Group Inc. said Tuesday it plans to cut 5,800 jobs following its acquisition of National City Corp. last year as the bank swung to a loss during the fourth quarter.

http://finance.yahoo.com/news/PNC-Financial-swings-to-4Q-apf-14234855.html

Morgan Stanley plans up to 4 percent in job cuts - Yahoo! News

NEW YORK (Reuters) – Morgan Stanley (MS.N) plans to cut about 3 percent to 4 percent of its work force, or up to 1,880 people, as it battles with spiraling costs and slowing business, according to a person familiar with the matter.

http://news.yahoo.com/s/nm/20090202/bs_nm/us_morganstanley

GM, Chrysler offer workers cash, cars to leave - Yahoo! News

GM is offering its U.S. hourly workforce $20,000 in cash and a $25,000 voucher to buy a vehicle as an incentive to retire or leave the company, one United Auto Workers union local president said on Monday.

http://news.yahoo.com/s/nm/20090202/bs_nm/us_autos_buyouts

Macy's cuts 7,000 jobs, slashes dividend - Yahoo! News

NEW YORK (Reuters) – Macy's Inc said on Monday it would slash about 7,000 jobs and cut its quarterly dividend as it forecast earnings for fiscal 2009 that fell far below Wall Street expectations, sending its shares down 4 percent.

http://news.yahoo.com/s/nm/20090202/bs_nm/us_macys

GlaxoSmithkline to cut 6,000 jobs: report - Yahoo! News

Sun Feb 1, 7:48 am ET
LONDON (Reuters) – British drugs company GlaxoSmithKline Plc. (GSK.L) is set to announce about 6,000 job losses when it posts results on Thursday, the Sunday Telegraph newspaper said.

http://news.yahoo.com/s/nm/20090201/bs_nm/us_glaxosmithkline

Another half million jobs lost in January, survey says - MarketWatch

By Rex Nutting, MarketWatch

Last update: 10:33 a.m. EST Feb. 1, 2009

WASHINGTON (MarketWatch) - The axe fell on an expected half million jobs last month, economists say, and the only reason the job losses weren't larger is that weak hiring for temporary jobs in November and December meant fewer people were laid off in January.

The economy lost 1.5 million jobs in just the final three months of the year, bringing the losses for the entire year to 2.6 million, the worst since 1945.

Economists surveyed by MarketWatch are forecasting a seasonally adjusted net loss of 525,000 jobs in January, following losses of 524,000 in December, 584,000 in November, 484,000 in October and 403,000 in September. It would be the first time since the Depression that jobs fell by more than 400,000 for five straight months.

The unemployment rate is expected to rise to 7.5% in January from 7.2% in December. It would be the highest unemployment rate since 1992. Economists expect the jobless rate to hit nearly 9% by early next year. If so, the about 4.5 percentage-point increase in the unemployment rate from the low of 4.4% would be the worst in the post-war era.

http://www.marketwatch.com/news/story/story.aspx?guid=%7B63760694%2DDDA7%2D4AD9%2D8813%2D56227701CCB0%7D&siteid=YAHOOB

Hitachi (7,000), NEC Slash Jobs Amid Big Losses - WSJ.com

TOKYO -- Japan's electronics giants forecast steep losses and unveiled sweeping job cuts, the latest signs of how the country's recession is deepening.

In what would be an unprecedented loss by a Japanese manufacturing company, Hitachi Ltd. said it expects to post a full-year net loss of 700 billion yen ($7.8 billion), compared with a previous forecast of 15 billion yen. Hitachi, which makes everything from flat-screen televisions to power systems, said it will eliminate 7,000 jobs, slash costs and freeze capital spending.

http://online.wsj.com/article/SB123331016306332975.html

Caterpillar sets more layoffs; week's total 22,000 - Yahoo! News

CHICAGO (Reuters) – Caterpillar Inc (CAT.N) said it was laying off an additional 2,110 workers, bringing the week's total to about 22,000, as the company scrambles to cope with a downturn in demand for its construction and mining equipment.

http://news.yahoo.com/s/nm/20090130/bs_nm/us_caterpillar

NEC's loss widens, plans to cut 20,000 workers

AP
Friday January 30, 5:41 am ET
By Mari Yamaguchi, Associated Press Writer

NEC quarterly loss widens amid global downturn, plans to cut 20,000 workers

Disney plans 5 pct job cuts at ABC group

LOS ANGELES (Reuters) – Walt Disney Co plans to lay off 200 people at its ABC division, a Disney executive familiar with the situation said, underscoring the media industry's struggle with sliding ad sales.

http://news.yahoo.com/s/nm/20090130/bs_nm/us_disney_layoffs

AstraZeneca to cut more jobs; quarterly profit slips 1% - MarketWatch

AstraZeneca to cut more jobs; profit slips 1%

Drugmaker to lay off a total 15,000 employees by 2013

By Aude Lagorce, MarketWatch

Last update: 9:27 a.m. EST Jan. 29, 2009

LONDON (MarketWatch) --

http://www.marketwatch.com/news/story/story.aspx?guid=%7B67712D19%2DDE87%2D477F%2DBDAA%2D7918B8127B44%7D&siteid=YAHOOB

Kodak posts 4Q loss, plans up to 4,500 job cuts - Yahoo! Finance

ROCHESTER, N.Y. (AP) -- Eastman Kodak Co. said Thursday it is cutting 3,500 to 4,500 jobs, or 14 percent to 18 percent of its work force, as it posted a $137 million fourth-quarter loss on plunging sales of both digital and film-based photography products.

http://finance.yahoo.com/news/Kodak-posts-4Q-loss-plans-up-apf-14192726.html