The Business World

Freddie Mac posted its fourth quarterly loss this week and is waiting for the onslaught from the prolonged housing crisis to hit them hard. In order to prepare themselves for this they have set aside twice as much money for bad loans and have made plans to cut their dividend by almost 80%.

The loss has come only three weeks after the U.S. government created an effort to prop up the second biggest provider of U.S. residential mortgage funding and its rival Fannie Mae, Freddie Mac affirmed a commitment to increase fresh capital.

Federal regulators shut down two more banks - who sold their banks’ deposits to Mutual of Omaha Bank - this week. The total number of banks now to close is seven. The Federal Deposit Insurance Corp. said it was appointed receiver of First National Bank of Nevada, based in Reno, Nev., and First Heritage Bank of Newport Beach, Calif. - both units of First National Bank Holding Co., of Scottsdale, Ariz.

Not long after Starbuck had released the 600 locations that they were going to shut down loyal customers created the Save Our Starbucks campaign. Customers from both small and large cities are making phone calls, writing letters, and sending out petitions in hopes that corporate will keep the doors of these stores open.

“Now that it’s going away, we’re devastated,” said Kate Walker, a facilities manager for SunGard Financial Systems, a software company, who recently learned of a store closing in New York City.

Coca-Cola announced this week that they have a $5.3 billion nin-cash write down that shows a decline for the value of its North American business. The charge is due to the declines in operating income and the decline in stock prices ”both largely the result of deteriorating North American macroeconomic conditions and expected substantial increases in commodity costs.”

Officials accused two drug stores chains of selling outdated milk, baby formula, and pills. Hours after this accusation was made several expired medications were seen on the shelves of the drugstores. The acetaminophen pain relievers were supposed to have been pulled down last year – but were still being sold in New York at the lower East Side CVS store. Other expired drugs were found in a Rite Aid.

Manpower Inc. has stated that number of new employees will be much lower than last year during the third quarter. Close to half the countries in the company (based out of Milwaukee) will be reducing the amount that they hire. The other half have made plans to continue hiring new employees during the July – September quarter.

General Motors – the world’s largest automaker – released a statement today that they would be ceasing all production from the Oshawa, Ontario pick-up truck factory. This will cut close to 1,000 jobs.

There is belief that they will be announcing the end of two U.S. plants in Ohio and Wisconsin at the annual shareholder meeting. They are making the cuts due to the increase in gas prices and the housing slump.

In May an important and key measure of consumer confidence reached an all time low as it dropped the most it has ever done in 16 years. The reason for this is that many Americans are worried about the future of their jobs and the business conditions.

The New York-based Conference Board said Tuesday that its Consumer Confidence Index dropped to 57.2, the lowest level since October 1992, from a revised 62.8 in April. Economists had expected the index to decline to 61, according to a consensus compiled by Briefing.com.

This week an analyst stated that Bed Bath & Beyond is going to lose consumers throughout the coming months. The home furnishings retailer was hoping that when Linens ‘n Things closed some of the store as part of a bankruptcy plan business would pick up. However, that doesn’t seem to be the case.

PiperJaffray analyst Neely J.N. Tamminga said in a research note that consumers are more likely to turn to lower-priced home furnishings, and discounters are more likely to benefit from the Linens ‘n Things 120 store closures.

American Airlines is cutting the U.S. capacity as close to as 12% and will be getting rid of 85 jets that will cause job cuts. They are hoping that this will help to counteract the fuel prices and slow demand.

AMR fell the most since September in New York trading. The reduction in domestic seating is more than twice what American had announced in April, and is the third cut in 2008. AMR also will add a $15 fee for the first checked bag.