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Banks Hit Foreign ATMs, Alcoa Rings in the Season
Citigroup and Merrill Lynch are seeking new cash infusions from foreign governments. Alcoa starts the earnings season with a bang, even though the season might fizzle. And in Prague, the world
 

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itibank, Merrill head back to foreign cash well

Citigroup and Merrill Lynch are in talks for billions in cash infusions from investors, mostly foreign governments, The Wall Street Journal reported. Merrill is expected to get up to $4 billion, mostly from the Middle East, while Citi stands to land up to $10 billion from foreign governments. (Reuters) The report sent both banks’ stock upward in overseas exchanges this morning. European and U.S. financial firms have tapped Asian and Middle Eastern governments for $34 billion in the wake of the subprime collapse. “Banks are looking to strengthen their capital in order to weather through this storm,” said Arthur Lau at JF Asset Management Ltd. in Hong Kong. (Bloomberg)

Alcoa kicks off earnings season

Aluminum giant Alcoa reported a 76 percent jump in profits, beating Wall Street expectations at the start of what analysts predict will be a weak corporate earnings season. Profits were boosted by Alcoa’s sale of its consumer and packaging units; revenue was down for the quarter. (AP in Yahoo! Finance) Alcoa shares jumped 5 percent in extended trading. (MarketWatch) Corporate profits last quarter probably grew at their slowest rate in six years, Bloomberg estimated. Banks face a tight year, and “the consumer discretionary sector has been decimated,” said Tim Ghriskey at Solaris Asset Management. “I don’t think the earnings will be particularly pretty.” (Bloomberg in RiskMoment.com)

Countrywide teeters on the edge

Countrywide Financial said yesterday that foreclosure and late-payment rates in December were the highest on record, fueling speculation that the mortgage lender will file for bankruptcy protection. Countrywide shares traded as low as $4.43 yesterday, before recovering to $5.12—it’s lowest close in 11 years. (Los Angeles Times, free registration) On Tuesday, Countrywide denied reports of its impending bankruptcy. Still, “virtually no one in the market is willing to cast a vote of confidence in this company’s ability to extricate itself from its current heap of trouble,” said analyst Rebecca Engmann Darst of Interactive Brokers Group. (Reuters)

Hooking up with Big Sister

At the Big Sister brothel in Prague, the sex is free—as long as you don’t mind it being broadcast over the Internet. More than 15,000 men have taken Big Sister up on the offer since 2005. Viewers want ever-more graphic reality TV, media analysts note, and they are willing to pay about $45 a month to get it, through Big Sister’s online subscription fee. The club’s Austrian owners have already recouped the more than $5 million they put into renovations, including installing 50-plus video cameras. “This is National Geographic for adults,” says marketing manager Carl Borowitz, who goes by the name Carlos. “Everyone’s curious to watch their neighbor.” (Bloomberg)
 

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