Madoff investors oppose payments to bankruptcy trustee

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Hundreds of Ponzi king Bernard Madoff's victims today challenged the latest bill from his bankruptcy trustee, which seeks more than $34 million for 120 days of work. The Aug. 20 bill, for services rendered between Feb. 1 and May 31, works out to more than $5,000 a day for court-appointed trustee Irving Picard and more than $283,000 a day for his firm, Baker & Hostetler, court papers say. "On an annualized basis, this would be $104,900,950," according to the objection filed by Diane and Roger Peskin, Maureen Ebel and "several hundred" other unnamed Madoff investors. [Snip] Picard spokesman Kevin...

Published on Friday 10th of September 2010 12:28:11 PM

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Harrisburg tense, on edge of bankruptcy

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HARRISBURG, Pa.- Tension is mounting in Harrisburg, Pa., concerning the city's potential fall into bankruptcy, observers said.Dauphin County, which is a guarantor of Harrisburg bonds, has given permission to a bond trustee, TD Bank, to sue the city over $35 million it owes on bond payments for an incinerator project, the Central Pennsylvania Business Journal reported Thursday.The city has balked at making payments, missing one deadline on Aug. 15, and County Commission Chairman Jeff Haste called city officials in a note to Councilman Brad Koplinski, "a bunch of cowards."

Published on Friday 10th of September 2010 12:28:11 PM

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Mexicana stops flying (Mexicana ceasing All Operations At MIDNIGHT EST)

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Debt-ridden airline Mexicana de Aviacion is halting all operations, Mexico's transportation secretary said Friday. Juan Francisco Molinar Horcasitas told reporters in Mexico City the struggling carrier will cease all flights and other activity as of midnight Friday night. Mexico's largest airline filed for bankruptcy protection in Mexico and the United States on Aug. 2 while it sought to reorganize itself. Three days later it announced that it had stopped selling tickets and then suspended some flights. In court filings, the company said it had been badly hit by the swine flu outbreak in 2009 that scared away travellers for months...

Published on Friday 10th of September 2010 12:28:11 PM

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Blockbuster tells Hollywood studios it's preparing for mid-September bankruptcy

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After dominating the home video rental business for more than a decade and struggling to survive in recent years against upstarts Netflix and Redbox, Blockbuster Inc. is preparing to file for bankruptcy next month, according to people who have been briefed on the matter. Executives from Blockbuster and its senior debt holders last week held meetings with the six major movie studios to discuss their intention to enter a “pre-planned” bankruptcy in mid-September, said several people familiar with the situation who requested anonymity due to the sensitivity of ongoing talks. Blockbuster is hoping to use its time in Chapter...

Published on Friday 10th of September 2010 12:28:11 PM

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Sovereign Subjects: Ask Not Whether Governments Will Default, but How

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This is the first issue of Sovereign Subjects, a new Morgan Stanley publication focusing on sovereign risk in advanced economies. In this first installment, we take a broad perspective on government balance sheets and raise several themes to which we will return in more depth in subsequent issues. We encourage clients to provide us with feedback on this new publication. Debt/GDP ratios are too backward-looking and considerably underestimate the fiscal challenge faced by advanced economies’ governments. On the basis of current policies, most governments are deep in negative equity. This means governments will impose a loss on some of their...

Published on Friday 10th of September 2010 12:28:11 PM

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Blockbuster (Video) repeats liquidation warning; future hinges on debt financing

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Deteriorating quarterly results forced Blockbuster Inc. to repeat its warning Friday that it might have to liquidate if it can't arrange new debt financing. The dire warning came as the Dallas-based movie rental chain reported a wider than expected three-month loss on a 20 percent drop in revenue. That was after persuading debt holders late Thursday to give it more time on a $42 million interest payment that was due. Debt holders either see improvements worth waiting for in Blockbuster's attempted turnaround or remain at a standstill about what to do next, analysts said. Meanwhile, the struggling company is running...

Published on Friday 10th of September 2010 12:28:11 PM

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Model corruption

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General Motors plans an initial public offering as soon as today -- a first step in the government's effort to sell its ownership stake to private investors. The IPO comes on the heels of a much publicized plant tour by President Obama, who'll certainly hail the stock sale as proof he made a smart decision by bailing out the automaker with billions of taxpayer dollars. But, to us, the IPO will be proof of something else: a White House that purposefully trampled the legal rights of investors -- many of whom, like us, are small savers -- to benefit its...

Published on Friday 10th of September 2010 12:28:11 PM

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Blockbuster mum on earnings [Bankruptcy finally here for longtime video rental giant?]

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The troubled renter of movies and video games said Wednesday it wouldn't hold a conference call with analysts after it released quarterly earnings, which it was supposed to do today. Now it appears Blockbuster might not even release those financial results at its scheduled time. Several calls and emails to Blockbuster press and investor relations were going unanswered, and, as of 4 p.m., there was no earnings release in sight. Blockbuster shares on Thursday rose 18% to 18 cents. The stock has been delisted from the New York Stock Exchange and now trades on the pink sheets under the symbol,...

Published on Friday 10th of September 2010 12:28:11 PM

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Why we need to let states go broke

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Federal Band-Aids won't cover the fiscal problems of such states as New York, California, Michigan and Connecticut forever. State bankruptcy and fundamental restructuring of state and local finance -- and labor relations -- is at hand. Take Connecticut. In the current fiscal year, $2 billion in federal subsidies have helped tide it over the recession -- a hefty share of its $15 billion budget. But these infusions are one-shot grants, renewed only if Congress acts affirmatively to do so. Other states depend on similar manifestations of federal largess. In Washington, the House is set to pass a $26 billion aid...

Published on Friday 10th of September 2010 12:28:11 PM

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Report: Duchess of York may face bankruptcy

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LONDON — The Duchess of York's debts have reached 5 million pounds, or nearly $8 million, and her only option may be the first voluntary bankruptcy of a royal, The Sunday Telegraph of London reported. At least one senior financial adviser to Buckingham Palace recommended the action despite the acute embarrassment it would cause for her ex-husband, Prince Andrew, and Queen Elizabeth, The Telegraph said. The queen is said to be “deeply concerned” by the debts, which are more than twice as large as previously thought, the newspaper said. Even Prime Minister David Cameron has been briefed on the issue...

Published on Friday 10th of September 2010 12:28:11 PM

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Mexicana Airlines files for bankruptcy (suspends flights at U.S. airports, blames labor costs)

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Mexicana Airlines, the busiest foreign carrier at Los Angeles International Airport, announced Tuesday that it had filed for bankruptcy protection in the U.S. and Mexico, blaming much of its financial trouble on high labor costs. The debt-ridden airline made the announcement one day after suspending 31 flights at airports across the country, including in Los Angeles, New York, Chicago, San Jose, Sacramento, San Francisco and Oakland. At LAX, the airline put a hold on four of 15 daily flights to Puerto Vallarta, Guadalajara and Mexico City. The Mexico City-based airline promised to contact passengers with tickets on canceled flights for...

Published on Friday 10th of September 2010 12:28:11 PM

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