Seattle Times to Singleton: Time to sell

Once completed, the MediaNews Group's bankruptcy will leave banks owning most of the newspaper chain. Banks shouldn't own newspapers, the Seattle Times argues, and so it's time to break the chain apart and sell the pieces locally.

From the Times:

Newspapers report on the banks; they should not be owned by them. Newspapers should be independent. ...

If there ever was a way to kill the American people's appetite for newspapers, it is this. Make the paper nonlocal. Make it the same everywhere. Treat it as a "property," like a telephone-company bond or a share of stock. Don't sweat the long run because in the long run, as the economist said, we are all dead.

That is not the way to save newspapers.

Newspapers need to be in the hands of people who care about them. Those are almost always investors with a strong local connection. The San Jose Mercury News ought to be owned by people from San Jose — not by a company in Denver owned by another company in Denver owned by a bank in Charlotte, N.C.

The home front

California leads the nation in home foreclosures, and there will be a lot more in the coming year. But banks aren't putting enough cheap homes on the market to satisfy the demand. We speak with Leslie Berkman of the Press-Enterprise, Rick Sharga of RealtyTrac, Tom Moon, founder of REObroker.com, and a frustrated would-be homebuyer. The segment starts at 7:34. Which Way, LA?

TARP indigestion

Some banks have had a hard time with their taxpayer chemotherapy treatments and say they want to stop. From the New York Times:

Wall Street banks have taken billions of taxpayer dollars. Now some of them are starting to wonder if they should give the money back.

Even before the government announced its latest efforts to fix the troubled banking industry on Tuesday, executives at Goldman Sachs and Morgan Stanley said they wanted to repay the money quickly. Both banks received $10 billion under the first rescue plan last fall.

-snip-

“We just think that operating our business without the government capital would be an easier thing to do,” said David A. Viniar, the chief financial officer of Goldman. “We’d be under less scrutiny, and under less pressure. Not that we’d be out of the public eye; we’re still going to be in the public eye.”

It's good they're feeling so healthy again, right?

Also, shouldn't we take some comfort in the fact that the Dow dropped today after Treasurer Timothy Geithner laid out TARP II? Like, maybe stockholders are coming to grips with the reality that the government can't make their broken eggs whole again.

A buyer for IndyMac

Tis the season for fire sales, and Dune Capital Management has seized the moment to buy up the failed lender IndyMac Bancorp for an undisclosed amount. Dune Capital is run by a couple former Goldman Sachs partners, who might dip into TARP funds to seal the deal.

News of the sale comes from Mortgage Lender Implode-O-Meter via LA Biz Observed.

The Implode-O-Meter also links to this fun fact from Michael Hodges at Grandfather Economic Report:

America has become more a debt ' junkie'than ever before with total debt of $53 Trillion- and the highest debt ratio in history. That's $175,154 per man, woman and child - or $700,616 per family of 4, $33,781 more debt per family than last year.

Humpty Dumpty wrote a bad mortgage...

Our financial houses are folding. Bank of America sops up Merrill Lynch; Lehman Brothers falls into bankruptcy; AIG begs for a $40 billion government bailout. This is what happens when transaction-making becomes your leading industry.

Who will put Wall Street back together again?