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Daily News – July 23, 2009

July 23, 2009

The New York Times has written an editorial calling CIT “on the verge” of collapse, and saying that the Obama administration should be ramping up it’s $15 billion dollar program to buy small business loans and debts, which would free up cash in the markets to keep banks like CIT loaning to small businesses. Bloomberg has just released news that a bankruptcy filing may be in the cards for CIT in August. We’re not surprised about that, but the question now is what will the bankruptcy strategy be, and what will clients to do find financing?

The new CIT strategy would essentially mean that a “pre-packaged” bankruptcy for the company would follow the bondholder payout that is supposed to happen next month. CNN Money is writing that an out of court strategy has developed and will be in play, and The Wall Street Journal has just said that the price of the notes that were going to fetch 82.5 cents for every dollar they were worth has now dropped to 79.5 cents, which means that they are now priced below the already discounted tender price – showing that there is little confidence that the August payout will go smoothly.

With CIT bracing for bankrucpy, the value of their bonds evaporates every day

With CIT bracing for bankruptcy, the value of their bonds evaporates every day

And in more virtual news, Men.Style.Com is going to be discontinued, re-focusing the style and related content to the magazine that it currently services.


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