Moving On: My Move Ends; Does the Banking Industry or A-B Go Away NEXT?

It is the weekend. For the past 3 days I have been moving...and moving...and moving...and moving...and moving...and you get the picture. I hurt in places I'd forgotten about being body parts in the first place!!!

I'd like to apologize to all, and thank a lot of people. If I had saved up enough money to make the move go quickly or hire some people to help, I'd have had it all done 3 weeks ago. But, as it turned out, I was off on Wednesday (scheduled) as well as Thursday and Friday (unscheduled on Thursday - but the boss told me to take off Friday to rest...he was WISE in doing so) --- and the RABBITT REUNION show didn't air as a regularly scheduled broadcast since Tuesday. So, I apologize - I meant to bring you LIVE shows...but, unable to do differently, I'll return on Monday and get back into the full swing of things.

ALSO, I'd like to thank Bob "The Grim Reaper of Radio" Romanik, The Foxman, Jim "Super" Shannon, Tina Sanders - Queen of the Golden Oldies, Clark "Dr. Boogie" Davis, Al Gross, Mad Maynard and Jackie McCoy, Steve Davis, and T. J. the DJ for the moral support. Having a great team surrounding you at work (KZQZ) makes a difference - especially when you are going through a rough period. Make no mistake, it's been a rough adjustment to move almost all of your personal belongings.

BIG Thanks: I'd like to thank Captain KT, my parents, Diane (the Elvis fan/KZQZ fan), my ex (yes, I'm thanking my ex - she really helped me load up some of the heavier pieces on Wednesday when there were no other ablebodied persons who could help with the over-100 pound or bulky pieces of furniture) and my daughter. Each made a contribution to the move and I am truly grateful .

Also, thanks to the new advertisers coming on. Hearing the words that you want to advertise on the RABBITT REUNION makes me greatly hopeful. We're in to something good, as Herman's Hermits told us.

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"BANK DEPOSITORS WITHDRAW MONEY IN A PANIC"
It sounds like an early 20th Century headline.
But today it is a 21st Century headline...about IndyMac Bancorp Inc.

Why?

According to a variety of online articles I have combed through, the regulators of the U.S. banking industry seized mortgage lender IndyMac on Friday because of a large amount of withdrawals by "panicked depositors". Yes, the Federal regulators' takeover of IndyMac means a shift in the California-based company. Because of FDIC (Federal Deposit Insurance Corp) supervision, the lending institution will become IndyMac Federal Bank when it reopens on Monday.

Here's (at least part of) the backstory which led to the seizure. IndyMac was founded by the same founders of Countrywide --- which was taken over last week by Bank of America. Countrywide remains the poster-child of lenders who aren't diverse enough. Anyway, IndyMac customers began to earnestly withdraw their money from IndyMac over the past few weeks. The company made a statement early in the week that it was going to cut its workforce by approximately 60 percent. Truly important to note: the company tried - it apparently asked for help. It HAD to ask for the regulators to help: depositors pulled out approximately $1.3 billion from their accounts between June 27th and July 10th. According to company business statements, IndyMac had lost $799 Million --- that was the deficit --- over the past half-year. Shares of the company's stock were trading at around $50.00 each just two years ago. It was trading at around $6.00 in December. It fell to 28-cents the other day.

In the timult this week, the regulators closed the headquarters branch in Los Angeles on Friday, searched through the paperwork, then began the process of taking over the lender --- and to look for a buyer of IndyMac. Some experts who were sought for comment estimate that almost 100 percent of the money in the company had been invested in mortgage assets. THAT is some estimate. And it's not easy to work in management when you're looking at gigantic debts from the foreclosures. If all your money is tied up in something that's LOSING money...you're not doing so well. That's similar to putting all your money on a poker player who is entered into a tournament against players who are on equal-footing. As I see it, you can never watch one of those TV tournaments and figure out who will win. SAME thing here. You cannot tell who will come out ahead. And when the economic picture is bleak on the home mortgage and home prices AND sales are dropping, the lenders end up losing...and the customers of IndyMac obviously picked up on that (a smart lot those with enough foresight to pull out their money from IndyMac BEFORE Friday). When an institution faces all of this, it is not in the position to save itself very easily. This was simple. The Federal regulators move will mean someone else (another more diverse lender, perhaps) takes control. Quoting a Reuters article, printed in the New York Times, "At the time of closing, IndyMac had about $1 billion of potentially uninsured deposits held by about 10,000 depositors. The FDIC said it would pay those depositors an advance dividend equal to 50 percent of the uninsured amount." For NOW, they'll insure only HALF of the outstanding debt. Let's read this one of two ways, depending upon whichever side one is reading it: I received a loan Thursday for $200000, which is perhaps now worth $100000 (I admit I know this won't happen, but it is an illustration). Or - more likely - perhaps I deposited $100000 on July 2nd - which is now worth $50001. Am I happy about this?

Oh...and the FDIC is estimating CURRENTLY that 90 banks/lending institutions are in trouble. Four have now failed in 2008...that's one more than all of 2007.

Does this sound a bit like we are heading toward OTHER bank raids and takeovers?

Are Fannie Mae and Freddie Mac going to hear something good soon, or will these --- allegedly --- nearly untouchable institutions be belly-up within the next 24 months? Freddie Mac may cut shareholders dividends. Soon.

Does FEAR BEGET FEAR? According to a notation online, there is a Citigroup report going around by that title calling the sell-off "overdone". But, I ask you: Is it just an overdoing of the economic woes?

My opinion is: there is no way to make the economy right itself in the short-term. We are in a depression...or bound for it very shortly. The banks will see raids. The Wall Street wizards will not be able to stop the stock sell-off that has begun. And the small guy will eventually win as much as the "wealthy" guy. First, we'll all have to lose --- some will lose it all, just like the 20th Century Depression. This is the beginning of the 21st Century Depression. We're still awaiting the full-blown failure. But, with every failure, lessons are learned and new fortunes will be made. Here's to prayer --- say some for yourself, family, friends, other loved-ones. We're facing a crunch that is about to assert pressure upon our lives: rich, wealthy, middle-class, poor.
If you're a betting kind, you're beginning to wonder "who is rich and who is poor anymore?"?!?!?!?!? And by 2010, we may be mostly poor and learning to survive all over again.

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A-B and InBev are in "friendly negotiations". That's a simpler way of saying that August A. Busch IV may have finally heard (maybe the information didn't get filtered from his inner-circle this time) what his uncle, Adophus Busch the whatever, is saying along with the other money-grubbing shareholders, and he decided to hear out what Carlos Brito and InBev could do for those who want the money, want the money, want the money. Basically, they're saying "okay...the offer is up to $70 a share...we're going to sell. Jump on the bandwagon, little boy Busch, and we'll hold it up there for until the buyout happens."
The rest of those who stand to lose --- the distributors and those involved in the entire "network" of Anheuser-Busch companies --- won't get the value from the sale of the St. Louis-based (for now) beer giant. That will add to the woes of the economy in St. Louis and across the United States.

This "deal" is another nail in the coffin of the legacy of Vice-President Dick Chaney's and President George W. Bush's great economy. It may not seem like it yet, but you'll see it will be a big one.

I have heard this said in St. Louis for years: The way beer sales go...so goes the economy.

Beer sales has been so-so, at best, for the big American-based companies in the past 20 months.

So we ask: What happens next? Another BANK RAID DAY (or week) in which ten to twenty lending institutions fold and become FDIC banks? Or, InBev is in the corporate seat of America's beer giant, laying off the people who have made the economy work for more than 100 years?