Banks across the EU took part in securing 489 billion Euros in loans from the European Central Banks first ever offering of a three year funding. The money will be used to avoid a credit crunch in the EU and to buy Italian and Spanish debt.  523 banks participated in the offering, which well allow the EU banks to keep lending so to avoid hampering economic growth and spreading the debt crisis further.

This was the biggest ECB infusion of credit in the 13 years of the  Euro. There was great excitement over the  additional 189 billion euros lent over the estimated 300 billion euros the market was expecting, mainly because it highlighted the needs of the European banks.

The Bank of England policy makers have left the option open for more cash to be available to the economy in February due to the risk of another recession from slower consumer spending and the euro crisis.

The news leave the possibility for a third round of quantitative easing which could happen in February. The European crisis, is also expected to create a third round in the United States as well as in Japan and the other banks in the European Union

It is wildly regarded that the second round of quantitative easing failed to solve the economic problems.

In other news, Rim turned down offers from Amazon and Microsoft to buy their struggling company.  Rim staff have reported that they prefer to fix their problems on their own.  Rim is up 10.54% on the news.

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I came across an interesting article predicting the end of some well-known companies in 2012. I thought I would share with you Rick Newman, financial author and columnist, predictions for the new year.

Newmans methodology was to examine stock prices, expected 2012 earnings and financial information on a series of companies, his list of companies include the following:

Eastman Kodak- No surprise here, the company’s stock price declined 85% in one year. Their man business, photo film, is a dying business and the company has been slow to react to the digital market. In order to fend off bankruptcy, the company began to brainstorm ideas for a new market. Instead of going to the obvious and venturing into the digital photo world, they tried unsuccessfully to enter the pharmaceutical and document management world.  Today, they are in the process of selling off assets to raise cash with the hopes of being able to return to a profitable company. The company has been trading below a dollar and is setting off alarms from analysts that they might be delisted.

Research in Motion: Well no big surprise here. Canadians around the world have been hearing about the demise of the Canadian Golden Child. The once all mighty blackberry which held 55% of the smart phone market two years ago has seen their stock price drop 76% in 2011.  With an exploding smartphone market, RIM has been slow to respond to the changing demands and demographics of the smartphone user. Many are predicting RIM might be a target for a takeover in 2012.

Officemax: This might simply be a story that three is a crowd. Officemax, the competitor to Staples and Office Depot has found out that she really is the third wheel when her stock price decline 75% year to date. With a tough economy, the office supply world is facing pressure from stores like Walmart and Costco, but Officemax is facing the hardest year of the entire group.

Monster Worldwide: It  looks like when you can’t find a job, you also shouldn’t be investing with Monster, a job advertising website that connect potential employers with employees. Their stock has fallen 67% and they are facing competition from competitors entering the online world, squeezing their profits. With a slow economy, Monster is struggling to keep drumming up business.

Netflix: Well the digital movie world might have taken down Blockbuster, Netflicks success came to halt with a bad decision. The hottest movie rental website came crashing down when they tried to separate their DVD by mail and video stream services in two, allowing them to increase prices.  Customers freaked, and with new competition entering the market, subscribers moved to the new providers. Netflix stock subsequently dropped 60% and a sharp earnings drop expected in 2012 makes Netflix a prime target for a takeout.

Hewlett-Packer: A third CEO in two years can only mean two things: a company turn around or imminent disaster.  With so many hands stirring the pot the company strategy has been confusing and earnings have been reflecting a lack of leadership. HP participates in numerous industries and competitors have been taking away market share in all categories.  The company has been trying to grow through acquisitions in recent year but have left major holes in their new product development. With a 38% year to date stock decline, the newest CEO Meg Whitman has some work on her hands to make it through 2012.

Best Buy: Just when they hands up in victory after Circuit City declared bankruptcy in 2009, Best Buy got suckered punched. Circuit City opponent- cash poor consumers, ruthless price pressure, online stores- is now after Best Buy. The company is reporting lower than expected earnings and is concerned about consumer spending. Their future success depends on whether consumers will spend in 2012 or if they will save and pay down debt.

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China started trading its domestic currency against the Australian and Canadian dollars yesterday morning, with the goal of creating greater demand for the Yuan and hopefully making it fully convertible for international transactions.

The addition of Canada and Australia brought the Yuan tightly controlled foreign exchange market to nine including- the Euro, Hong Kong dollar, Japanese Yen, Malaysian ringit and Russian ruble.

The Chinese central bank allows the Yuan to move up or down .5 percent from it’s fixed rate to the US dollar each day, but does allow the Yuan to move 3% against other currencies.

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Canada asbestos sector has grounded to a halt, after 130 years in operation. After years of noisy political debates and a dramatic anti-asbestos conference, Parliament Hill stopped production.

Work at the mine halted earlier this month at Lac d’amiante du Canada and was halted today at Jeffery Mine. The work stoppage is expected to cause Canadian asbestos to disappear from the international market, as the product supply dries up at both mines from their limited inventories.

Asbestos was once such a popular resource that it was called the ‘magic mineral’ for its ability to insulate and fire-proof building structures. Canada once produced 85% of the world’s resource, and the US military even drew up plans to enter Quebec and defend the mines in 1930, if the Germans ever occupied Canada.

The industry started its slow decline in the 1970, when science started linking asbestos exposure to serious health problems like cancer and lung disease

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30 large US companies successfully paid no income taxes during 2008-2010, even though the US corporate tax rate is among the highest in the world.

The companies, which included, GE, Paccar Inc, PG&E Corp, Boeing Co and Pepco holding, successfully avoided paying taxes by using tax loop holes that were perfectly legal. The list was put out the McIntyre’s group.

Pepco Holdings, a Washington DC power company, effective tax rate was -57.6%, the lowest among the 280 Fortune 500 companies listed.

The companies were able to do this by using accelerated depreciation, executive stock options and research and development on US soil.

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