Condo Builders - Essay Example

Condo Builders Fuel Land Rush in Miami

The article is essentially on Condo builders in Miami who are rushing for the few left unbuilt sites hence amplifying the plot values to very high prices. Earlier when the plots’ prices were low, buyers snapped them, but the units have been completely absorbed lately. Prices are ranging from $550 to $675 per square foot, and brokers predict rising prices of up to $1000 per square foot. The prices, however, are not scaring away investors especially those from abroad, and they are contesting who will control the best sites in Miami. Shortage of land has since been evident, especially on the waterfront, and buyers are relying on the Latin American style of financing, which necessitates one to deposit a minimum of 50% before closing to fund construction. Developers will thus affect the rental market adversely since everyone is moving away from rentals thus raising demand.

Bet on Failed Bank Creates Windfall

CIT Group is set to acquire $3.34 billion in cash from OneWest in a deal they project to produce profits of 3.35 times its initial investment. OneWest collapsed in 2008 thus becoming the third largest bank failure due to growing concerns by customers about its rising mortgages. The deal drew scrutiny from the dividends they produced for private-equity firms and their investors, but regulators had few choices. CIT majors in commercial lending and the deal is set to boost its assets to $67 billion. The firm’s top cop is confident the regulators will approve the deal, and he is gratified with the deal because it will be worth the expense that comes about with crossing the $50 billion mark.

Connecticut Supreme Court to Revisit Protection for Whistleblowers

The article tinctures on a court ruling set to be revisited to determine whether misconduct done by employers to staff should apply to cases brought under Connecticut law. It further cites an example from a case brought forward by Mr. Trusz, who was fired by UBS for allegedly overvaluing properties leading to excessive fees for clients. He consequently sued the banks citing his superiors treated him differently from others who did not complain before winding up their employments. Investors predict they could lose a lot if the court interprets the law narrowly since whistleblowers will have their safety compromised against reporting firms’ wrongdoings. If the ruling favors Mr. Trusz, it will limit employers’ flexibility to make tough verdicts on workers. In its defense, UBS claimed Mr. Trusz's duties encompassed in his official duties did not include valuations of property, but he defended his actions by saying that whistleblower shelters are essential to shield those trying to uphold their duties to customers.

Herbalife Rallies in Face of New Attack by Ackman

The article distillates on Herbalife, a nutritional supplement company, being brought forward by William Ackman, who claims the firm is a fraud and a pyramid scheme. The firm has refuted the allegations despite Mr. Ackman providing evidence to cement his claims. Wall Street reports the company shares have increased abruptly even with the allegations because investors had to redeem shares they had borrowed to bet the stock price would drop. Mr. Ackman compares Herbalife to Enron Corp, which posted the greatest fraud, because of manipulating the poor in new and prevailing markets. He is however not surprised to observe the company’s shares as he says the firm is buying back the stock to shadow the indictments.

Fog of War Clouds Defense Contractors' Prospects

Investors believe defense contractors are always benefitting from scary headlines, but that is not the case. Northrop Grumman and General Dynamics are due to release their quarterly results, which are buoyed by earnings, new contracts, stock buybacks, etc. FactSet predicts a slight change in earnings from $2.05 to $2.20 by Northrop, and a drop from $1.81 to $1.77 from General Dynamics. Crimea seizure by Russia and Gaza fire has shaken the stock market though they have assisted defense contractors to outperform. The two firms, Grumman and General, trade at premiums of 20% and 27% respectively, but the proposed U.S. defense budget demands a 2% drop in attaining and general expenditure.