On March 5, the Bureau of Labor Statistics reported that unemployment in February remained flat at 9.7%, indicating to many economists that we may truly have reached the trough of the jobs recession. In reaction, the Dow industrials rose 122 points on March 5 to close at 10,566. However, last week also brought news that the FDIC took over four more banks last week, raising the number of failed banks so far in 2010 to 26.
Speaking of banks, it’s not only Ariana Huffington of the Huffington Post and others who are encouraging people to “move your money” from the big banks at the root of the financial and markets crisis of 2008-2009 to smaller community banks and credit unions. A The Sunday New York Times, a map of the nation shows that some state and local governments are going local, too. Speaking of The Times, Yale’s Paul Shiller provides some historical context in his column this week on how and why government subsidizes housing.
The battle over healthcare and financial services reform continues. The latest persuasive tool being used by the Obama Administration are findings by Goldman Sachs that two big health insurers should be considered buys because of rising insurance premiums and decreased competition. The Secretary of Health and Human Services, Kathleen Sebelius, spoke on the issue during several Sunday morning TV talk shows. Fittingly during Oscars week, Hollywood got into the debate via a Ron Howard-directed, slightly off-color short film that features a host of Presidential impersonators from Saturday Night Live giving President Obama advice on healthcare.
On March 8, AIG announced the sale of another big, non-U.S. asset–American Life Insurance Company (ALICO)–to MetLife for $15.5 billion, including $6.8 billion in cash and the remainder in equity securities of MetLife. As with the announced sale last week of its Asian life insurance company, American International Assurance (AIA), AIG said it would use the cash proceeds from the ALICO deal to pay down its New York Fed debt.