Thursday, January 5, 2012

Blue Chips in the Red: Kodak

Part 2-of-2:
The company has few trump cards left, that may be strategically played to buy them just enough time to stage a come back. Kodak has intellectual property that gives them the ability to earned licensing fees from, amounting to nearly 1.9 billion over the past three years. Although it brought in only $27 million in licensing fees in the first half of 2011, they anticipate yielding over $340 million in the first quarter of this year. Nevertheless, there has been a shift in their strategy, as Associated Press reported that the company is trying to sell its patents, which are said to be valued somewhere in the area of $2 - $3 billion. This may be to stave off bankruptcy, or perhaps to sustain the company through a bankruptcy protection.

In the past decade, Kodak had taken steps to shift its primary business to meet the demands of the technology revolution. Kodak had invested hundreds of million of capital in a new software for workflow, in addition to new home printing products, particularly photo printers and commercial inkjets. The company was all set to surpass their breakeven-point in 2005.

The CEO, Perez, had high hopes that 2013 would be a turning point for them with their new line of inkjets, their licensing and workflow software, but it is clearly faced with a myriad of business concerns weighing them down. The Wall Street Journal reported that three of Kodak's Board of Directors resigned in recent weeks, and Kodak is preparing to file for chapter 11 in the coming weeks. With the resignation of nor one, but three board members, it seems that there may be a disagreement about what strategy to use to steer the company back to being a top contender in its field.

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K. Reilly
The Cohn-Reilly Report

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Thursday, December 22, 2011

2011 Local Heroes that Rock!

In these troubled economic times, as the Country struggles to stabilize and return a healthier financial future, families have had to reinvent ways to survive the higher cost of living with lower income. What, with news of global financial crisis, natural disasters, and local proliferation of human assaults; from abuses to homicide, it's only blind faith and inner strength that safeguards our sanity.

That said, there are indeed fewer and fewer reasons to smile, and increasingly difficult to keep a body’s self-esteem intact. But alas, there are needles in haystacks to be found if we look hard enough, and rays of sunshine that threaten to warm the hearts and souls of communities around the city. One such ray of sunshine comes to us in the form of Evan and Glenn Turtel, who I’d like to call heroes.The dynamic Duo saw the disparity in the math scores of students in the inner city public schools, and sought to answer the cry for help. The disparity in resources and education for inner city students is no less than a crime, so in the spirit of Batman, Superman, perhaps even Spiderman, Glenn and Evan Turtel, graduates of Wharton and Cornell respectively, founded Top Honors.

This organization is a non-profit math tutoring program that serves the New York community by shoring up the basic math skills and confidence of thousands of boys and girls. Their mission is simply this; "To provide all students with fundamental math and critical thinking abilities for success as students and productive members of society". Top Honors is a no frills, grassroots tutoring program that serves the underserved demographic of students throughout the city with impressive results. They’ve developed a unique curriculum, designed to pinpoint and strengthen each of the student’s problem areas. This remarkable organization is almost completely operated on volunteers.

For those of you with young children needing tutoring from time-to-time, you already know the cost of tutoring can run from $40 - $75 per hour, and as much as $400 for Saturday programs working out of various University sites. The cost of tutoring is even more expensive at programs like Sylvan and Score. As a parent, and grad student who has watched my work hours dwindle down to a frightening level, I am eternally grateful for this program. Top Honors has provided over 3,100 hours of tutoring this past year alone! So, for thousands of students who have already benefited from this awesome organization, and those yet to discover them, I emphatically elect Glenn Turtel and Evan Turtel NYC Local Heroes of the Year for their unyielding, uncompromising leadership and service to our community.

Source: Photos Used for the above Collage, were taken from Top Honors WebSite at

K. Reilly
The Cohn-Reilly Report

Sunday, November 27, 2011

$700 Million Bank Heist: SEC files charges

Did Citbank swipe $700 million from investors? Well according to an SEC filing, which alleges that Citibank sold securitized housing bonds, which they knew were sub-standard, and bet against them, something is definitely amiss. It’s easy to see why Banks are no longer seen as a safe place to invest your money, as a depositor or shareholder.

Citibank, being charged with fraud, is fighting the charges, but Recommended settlement of $285 million is likely going to stick. The SEC asked a federal judge to approve the amount, citing that $285 million would not unfairly punish the shareholders, who were essentially victims of the bank's unethical acts. Of the $285 million, the settlement breaks down as follows: $95 million is the fine, $160 million in for ill-gotten profits and $30 million in interest. We're about 18 months post signing of the Finance Reform Bill, and we're still unraveling the spoils of unbridled greed.

The national Occupy Wall Street Protest was founded on just this type of offensive conduct. I had a feeling that the near collapse of our financial markets in 2008 was the tip of the iceberg, and so far it has proven to be true.

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Monday, November 14, 2011

Geithner Joins EU Finance Ministers in Poland

Germany’s Chancellor, Merkel met with the Prime Minister of Finland on Tuesday, where I would have liked to have been a fly on the wall, given the growing concerns about several members of the Union. The Finance Ministers are gearing up for their meeting on Friday, with U.S. Treasury Secretary Geithner in tow.
Perhaps this is a smart move for the European Union’s Finance Ministers, considering what’s at stake. We can’t ignore the fact that Geithner has first had experience in helping to save a major economy from “falling off a cliff “in 2008. All while maintaining a cool, “everything is in control” fa├žade, avoiding fear and panic, which would have caused total mayhem.


DOW: Tripple Digit Gains – 9/14/11

It is believed that the Merkel, Germany’s Chancellor strongly declared the EU’s commitment to resolving the issues surrounding Greece’s fiscal troubles. Germany and France are applying pressure in an attempt to urge Greece to implement additional austerity measures.
The Dow Industrial Average closed up 140 point to yield 11, 246.73

Parents & Kids Check Out Great Math Site: Math Club

Tuesday, March 8, 2011

Big Insider Trading Case Begins Today

The former head of Galleon Group is set to go on trial today in Manhattan's Federal Court to answer to charges of insider trading. Rajaratnam is accused of acting on confidential information concerning Warren Buffet's plans to invest billions in Goldman Sachs in 2008. Buffet was getting great value for his investment, as the stock price at the time was $115, which was less than half of the price just one year earlier. Rajaratnam sought to take advantage of this insider information and purchase share of Goldman Sachs before Buffet's mulit-billion transaction which would create a surge in demand and lead to higher stock price. As predicted, after Warren Buffet's investment the market responded with buying frenzy and the Goldman shares increased to as much as $135 a share in after-hours trading. Needless to say, the Galleon Group's mission for windfall-like profit was accomplished. Was it really worth it Rajaratnam? Click chart below to see the complex web of insider trading that amounted to millions of illegal profits.

The use of surveillance and wire-tapping helped to being down the greedy trading ring, who all used pre-paid phones to avoid detection.

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K. Reilly
The Cohn-Reilly

Monday, March 7, 2011

Goldman: Witness for the Prosecution

Turning the tables, Lloyd Blankfein, CEO of Goldman Sachs is expected to testify in the hedge fund trail in Federal court as a witness for the prosecution. The testimony of the Wall Street big, should be a significant blow to the hedge fund titan Raj Rajaratnam. The SEC complaint contends that a tip from ex-Goldman Director, Rajat Grupta to Raj Rajaratnam concerning a large investment by Warren Buffet, lead to his purchase of securities. It was bad enough that Grupta breached confidentiality when he tipped his friend Rajaratnam off. However, Raj Rajaratnam transformed the breach to a federal fraud level by acting on the tip. It is alleged that Rajaratnam, bought shares within minutes of receiving the tip. No surprise that Rajat Grupta is also being charged with leaking confidential information to his friend at Galleon Group.
This insider trading case, has been in the NYC trial queue nearly 18 months. In late October of 2009, while the financial market was turning upside down, and cases fraud was beginning to hit a raw nerve in America, Raj Rajaratnam, was taken into custody for charges of insider trading. Raj Rajaratnam was founder of Galleon Securities which was investigated for insider trading of massive proportions, spanning no less than 6 other firms. Others cited as part of the insider trading ring include:
Charged With Insider Trading
Danielle Chiesi,    New Castle Funds NYC
Rajiv Goel,    Intel Capital (Subsidiary of Intel)CA
Anil Kumar,  
  McKinsey & CompanyCA
Mark Kurland, 
  New Castle Fund Upstate NY
Robert Moffat,    IBMCT

The trial that starts this week promises intriguing and disturbing headlines, as yet another tale of greed and entitlement is uncovered. Raj Rajaratnam is charged with 5 counts of conspiracy to commit securities fraud, and 6 counts of securities fraud.

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The Cohn-Reilly Check out the new Music and Art Forum on BlogSpot! "Its a refreshing departure from economics. it's like life's little desert snack."doARTorDIE

Saturday, February 26, 2011

Gift of Leniency: IRS’s Surprising Changes to Aid Taxpayer in Debt

Climbing your way out of debt is not an easy task under any circumstances, but if that debt includes back taxes, the pressure alone can add to the burden. Low and behold, in a show of compassion uncharacteristic of the IRS, those struggling to claw out of tax debt have been handed a gift of leniency. This past Thursday the Internal Revenue Service announced a new set of rules structured to aid individuals and small businesses in their effort to pay off tax debt.
The IRS commissioner, Doug Shulman, stated that it will place fewer claims on properties, and make any such liens much less of an impact on the credit ratings of anyone unfortunate enough to be subjected to property liens from the IRS. Additionally, the IRS was previously able to take legal claim to property in the amount of unpaid tax debt when taxes exceed $5,000.

The new regulations increase that to taxes exceeding $10,000, before the IRS can take legal claim. Shulman is quotes in the Wall Street Journal as saying that the new rules are an effort to “stand in the taxpayers shoes”. This clearly is a step in the right direction though more should be done to assist homeowners, in the wake of the worst recession in generations.

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K. Reilly
The Cohn-Reilly