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March 25, 2011     Post-Gazette
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with Ben Doherty king by Sal Giarratani ..... THE FED GIVES BANKS OK TO RAISE DIVIDENDS JP Morgan, Wells Fargo, JP Morgan Chase, US Bancorp, all 19 big banks controlled by the Fed are able to pay divi- dends and buy back shares of stock. The fundS are small but they are a start. Regula- tors barred banks from pay- ing dividends during the financial crisis without get- ting approval. By increasing payments, the banks attract new investors and should lead to more lending to people and businesses the Fed said. The Fed is taking a movement and conserva- tive steps on banks. It expects banks to limit divi- dends to 30% or less of their earnings. The green light from the Fed would also sig- nal that banks are in better shape financially in order to pay 30% or less than their earnings in dividends from earnings. The Fed said the 19 banks had improved earnings. The Fed has worked with the banks and increased their equity by more than $300 billion at the end of 2010. The mix 6f capital has improved since the financial crisis. The Fed released the results of a stress test to the public so confidence would be increased in the banking system. The fear would be by withholding information from the public about the banks health. The American people would have their confidence shaken and its confidence would be further hurt. The stocks rose at the end of last week, after chopping 250 points/day because of Japan and Libya. On Friday the market turned up after being down most of the day and added .6% to the S&P. The US could lose its AAA rating by 2018 under Obama's plan to increase interest to top 18%. That would exceed the $725 bil- lion at 18.2% under Obama's plan, according to the US Budget Office. The only option would be to raise taxes before 2018 to lower the deficit. The stock mar- ket fell after options expired in a triple bewitching day as options and futures all expired on Friday. Tobacco stock fell as they are look- ing at new leaders as Fed- eral Mugul said it hired them to evaluate strategic alternatives, a code name for a positive buyout strategy, and the FDA urged a ban on menthol cigarettes. For the week, the Dow fell 2.7%, the S&P fell 1% and the NASDAQ All the glory that was Rome ..... Pompei CAFF( "[EL. 617-227-1562 FAb