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Citigroup Credit Cardholders Will See Rates Jump -- Unless They Spend

For Citibank credit card holders, there is one way to escape the bank's rate hikes... more

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Walmart Closes Supplier Gap with New Financing Plan

Wal-Mart Stores Inc. is seeking to leverage its scale and its AA credit rating to offer about 1,000 suppliers an alternative to their traditional means of financing deliveries to the retailer. The move could give the world’s largest retailer by revenue more power over its suppliers in the wake of the bankruptcy filing by lender CIT Group Inc.
(O’Connell, V., 2009, November 14, par.1-2)

Wal-Mart informed its suppliers in a Nov. 2 letter of its new “Supplier Alliance Program,” in which eligible suppliers can get payment for their orders in 10 to 15 days within its receipt of goods, compared with the more typical 60 to 90 days. Under the program, suppliers can sell their Wal-Mart invoices to the retailer’s partner banks, including Wells Fargo & Co. and Citigroup Inc., according to the letter, at interest rates based partly on Wal-Mart’s credit rating. In traditional factoring, lenders give manufacturers cash for their receivables and collect payments on those invoices.
(O’Connell, V., 2009, November 14, par.3-4)

Wal-Mart, of Bentonville, Ark., said the move was aimed at improving the stability of its supply of merchandise, not replace existing relationships. “We know that many of our suppliers are dependent upon factoring and financing companies that are reportedly in financial distress,” Theresa C. Mercado, Wal-Mart’s senior director for product extension, said in its letter, which was sent to a group of about 1,000 of its suppliers, primarily apparel manufacturers. In all, Wal-Mart has about 60,000 suppliers.
(O’Connell, V., 2009, November 14, par.6)

A few retailers have begun experimenting with supply chain finance programs as alternatives to traditional factoring. In July, Kohl’s Corp. sent its suppliers a letter promoting a “reduced” 3.5% annual percentage rate of interest through its Supply Chain Finance program. The program, developed by PrimeRevenue, lets suppliers get paid early once their invoices are approved for payment, it said. The suppliers sell their invoices to Bank of America at an interest rate based on Kohl’s credit rating. Kohl’s, based in Menomonee Falls, Wisc., offered the program to 41% of its suppliers, and so far 11% have signed on, said Kohl’s spokeswoman Vicki Shamion. “This is not about CIT, but rather a proactive opportunity” for Kohl’s and its supplier partners, she said.
(O’Connell, V., 2009, November 14, par.8-9)

Suppliers might be more inclined to give certain retailers “preferential treatment” because of such programs, said Pratap Mukharji, a partner with consultant Bain & Company. It’s possible the arrangement could influence “how a supplier would look at a Wal-Mart, especially if, in a difficult economy, this program lets a supplier stay in business or make more money,” Mr. Mukharji added. Many retailers fear that once the economy recovers, their suppliers may struggle to fulfill the increase in shopper demand for certain products because they may not have access to the increased working capital needed to boost production. “The lack of visibility that retailers have into the true economic condition of some of their smaller suppliers is a big concern,” Mr. Mukharji said.
(O’Connell, V., 2009, November 14, par.10-11)

Wal-Mart says it hopes the program will result in a more stable supplier base and more predictable supply of merchandise. Wal-Mart spokesman John Simley said its AA rating should result in “more attractive” interest rates for many of its suppliers than they could otherwise get. At Fitch Ratings, for instance, Wal-Mart is currently the highest-rated retailer, with a AA rating, while Kohl’s is rated BBB+, a Fitch spokeswoman said.
(O’Connell, V., 2009, November 14, par.12)

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http://theretailsector.wordpress.com/2009/11/15/walmart-closes-supplier-gap-with-new-financing-plan/Wal-Mart Stores Inc. is seeking to leverage its scale and its AA credit rating to... more

jmsrmy
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Wall Street gets Swine Flu Vaccine while High-Risk Groups are Struggling to get it

This is beyond outrageous. Wwhile pregnant women and children with respiratory... more

Future_America
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"Showdown In Chicago": Protesters Crash Bankers Convention, (VIDEO, IMAGES)

Via National People's Action, here is some footage from the protesters at the ABA conference. From the footage, it's clear there are some strong emotions from the protesters.

At one point a protester grabs a megaphone and says:

"The American Bankers Association has helped loosen the rules that protect us, allowing the unfettered greed that has brought us to the brink of a recession. And for those bankers who are members and support the ABA's war against the working and middle class, shame on you!"

The crowd soon begins chanting "Shame On You!" in unison.

Via Progress Illinois' Twitter feed, here's more video of Sen. Durbin's speech. In this section, he calls for a "showdown" with Wall Street.

According to the Twitter feeds of National People's Action and the SEIU, the protesters are headed to the ABA's "Roaring '20s"-themed cocktail party. (Perhaps the ABA is not aware of the irony of having such an event.)

Sen. Dick Durbin spoke in front of the protesters earlier today. Here's a clip from the video, in which Durbin tells the story of homeowner who was struggling to stay in her home -- and was apparently talked into agreeing to a seemingly atrocious mortgage. The woman's mortgage was riddled with hidden fees and by, "the types of things even a Wall Street lawyer couldn't explain to anyone," Durbin said.

The American Bankers Association's annual convention in Chicago has become the scene for a series of major protests, which are set to continue through Tuesday. Dubbed "the Showdown in Chicago." (http://www.showdowninchicago.org/index.html) (Check back here frequently for updates on the protests.)

Groups like the National People's Action, the Service Employees International Union, Americans For Financial Reform and the AFL-CIO are expected to turn out with thousands of protesters. Sen. Richard Durbin (D - Illinois) is scheduled to address the protesters Sunday evening. Conference speakers include Newt Gingrich, conservative columnist George Will and FDIC chairman Sheila Bair.

Check out these photographs of the "Showdown in Chicago," taken by organizers of the protest.

http://www.huffingtonpost.com/2009/10/25/showdown-in-chicago-prote_n_333245.htmlVia National People's Action, here is some footage from the protesters at the ABA... more