$125 BILLION PLAN TO BAIL OUT SPAIN’S BANKS
On Sunday, Spain asked the finance ministers of the 17 Euro zone countries for money to rescue its banks. According to the Associated Press, the finance ministers offered up $125 billion that the Spanish government could funnel to its banks. The rescue money for Spain will come from pools set up by other euro zone countries. The Spanish banks will pay the loans back with interest. Unlike other European countries that have a high debt to GDP ratio, Spain actually has already tightened its belt. Its problems arose from a dramatic fall in real estate prices. This plan helps Europe’s fourth largest economy avoid bankruptcy. This is critical should Greece decide or be forced to exit the Euro zone later in the month. The Greek election is scheduled for June 17th. European stocks hit a 4 week high today and Asian markets were also up.
Chinese data weak but exports strong
Economic data released by China over the weekend indicates that a slow down may have been avoided due to recent actions taken by the Chinese, according to CNBC. Exports rose 15.3 percent while imports rose at 12.7 percent. The forecast for exports was 6.8 percent and it is anticipated that the current level will not be sustained. Experts predict, however, that the Chinese economy will bottom out in the second quarter and will be strong the remainder of the year. The biggest risk remains a weakening global economy.
Apple expected to show off new software at annual conference on Monday
The Associated Press is reporting that new software for the iPhone and iPad Touch has been confirmed and will be unveiled on Monday at the Worldwide Developers Conference in San Francisco. New phones are anticipated in the fall. Tim Cook, Apple CEO, is expected to show off new Mac models. The biggest unknown for Apple watchers is what will happen with Apple TV. It is unlikely, however, that any announcements are ready to be made at this time.
Moody’s Rumored to Downgrade US Banks
Moody’s Investors Service has said it is likely to reduce the credit ratings for 17 of the world’s largest banks by the end of June, according to the Wall Street Journal. The downgrade will include five of the six largest US banks. The downgrades will increase borrowing costs and crimp some of the trading businesses at the banks, including JP Morgan Chase, Bank of America, Citigroup, Goldman Sachs, and Morgan Stanley. The downgrades are anticipated to have the largest impact on the $2.6 trillion money market fund industry. These funds are restricted by law in what they can have their holdings in and they will need to change their portfolios. At this time, Standard and Poor’s and Fitch have not threatened downgrades to these banks.
Law schools cut admissions
The Wall Street Journal is reporting that due to a weak job market for lawyers, 10 of the approximately 200 law schools accredited in the US, plan to reduce the number of students admitted. Not only will reduction in class size allow greater opportunity for graduating students, but many schools feel it will raise admission standards. The number of law graduates this year was 44,495, up from 42,673 in 2006, according to the American Bar Association. Employment rates for the class of 2011 are at an 18 year low. About 86 percent of graduates found jobs last year, compared to 84 percent in 1994. Less than 66 percent of the jobs, however, required a law degree.
Where are the richest school districts in America?
In an article written by 24/7 Wall St. and republished by Fox Business News, it was found the 9 of the 10 richest school districts in the US are commuter towns located near New York City. All are in either Westchester County, NY or Fairfield County, Conn. The poorest school districts are rural communities scattered all over the country from Ohio and Kentucky to Texas and Mississippi. The average amount spent per student in the richest counties was up to $25,000 per student annually. The national average spent per student is $10, 591. The poorest districts spend less than one third of that amount. Not surprisingly, those in the richest districts have higher scores and are more likely to go to college.
Catherine S. McBreen is President of Millionaire Corner. McBreen plans and develops content for Millionaire Corner. Catherine balances editorial content to meet the informational needs of both new and seasoned investors. She designs special monthly surveys on topical issues affecting the economic environment.
McBreen has a B.S. in speech communications from Northwestern University and a J.D. from DePail University College of Law. She is a member of the American Bar Association, the Illinois Bar Association, and the Chicago Bar Association.
Well-known for her expertise in the affluent and retirement arenas, McBreen is a frequent speaker at industry conferences. She has been quoted widely by the financial media, including The Financial Times, The Wall Street Journal, Research, Private Asset Management, On Wall Street, Reuters, Bloomberg News, The Dow Jones Newswires and Worth. Cathy has appeared as a guest on CNBC Closing Bell, First Business Morning News, Neal Cavuto at Fox Business News, ABC and CBS radio.
McBreen is co-author with Spectrem President George H. Walper, Jr. of the book "Get Rich, Stay Rich, Pass It On: The Wealth-Accumulation Secrets of America's Richest Families" (Portfolio, January 2008)
Catherine is the mother of four and is involved in many school and community events.