• Crude prices rose back above $40 a barrel yesterday (Monday), as Israel and Palestinian forces exchanged fire and casualties mounted in the region. Light, sweet crude for February delivery rose $2.31 cents to settle at $40.02 a barrel on the New York Mercantile Exchange.

• A group of investment firms that includes J.C. Flowers & Co., Dune Capital Management, and Paulson & Co., is set to purchase IndyMac Bank, one of the nation’s largest failed banks, from the Federal Deposit Insurance Corp. (FDIC) according to CNNMoney. Neither the FDIC nor any of the potential buyers have commented, but the agency has said it expects the deal to be announced by yearend.

• Retailers may close 73,000 stores in the first half of 2009, the International Council of Shopping Centers said yesterday (Monday). More than a dozen retailers, including Circuit City Stores Inc., Linens ‘n Things Inc., Sharper Image Corp. and Steve & Barry’s LLC, have already sought bankruptcy protection this year, Bloomberg News reported.

• The interest rate on six-month U.S. Treasury bills fell to its lowest level ever at this week’s government auction. The Treasury Department yesterday (Monday) said it auctioned $27 billion in six-month bills at a yield of 0.25%, down from a rate of 0.285% last week, and an all-time low. The department also auctioned $26 billion in three-month bills at a yield of 0.05%, a slight increase from last week’s 0.04%.

• Commercial banks in the United States reported $6 billion in third-quarter revenue from trading foreign exchange, interest-rate and other derivative instruments, the Office of the Comptroller of the Currency said yesterday (Monday). That is significantly more than the $1.6 billion of trading revenue banks reported in the second quarter.

Source: Global Investing Roundups Tuesday, December 30th, 2008

“The decision to restructure the business through a Chapter 11 filing should provide us with the opportunity to strengthen our balance sheet, create a more efficient expense structure and ultimately position the company to compete more effectively,” James A. Marcum, vice chairman and acting president and chief executive officer, said yesterday (Monday) in a statement.

In the past year and a half, Circuit City has created nothing but a collection of ugly headlines. The Richmond, VA-based Circuit City has $3.4 billion in assets and $2.32 billion in liabilities, including a $119 million debt to Hewlett-Packard Co. (HPQ) and a $116 million debt to Samsung Electronics Co., Bloomberg reported.

Most recently, the fledging electronics retailer announced it would close 155, or 20%, of its 566 U.S. stores by Dec. 31 and slash its domestic workforce in an effort to conserve cash and reverse six consecutive quarters of falling sales.

The company has already slashed retail management positions, eliminated jobs at its corporate offices and laid off 3,400 retail workers.

On March 28, it was ousted from the Standard & Poor’s 500 Index.

The following month, Blockbuster Inc. (BBI) made an unsolicited $1 billion acquisition bid for Circuit City, offering at least $6 a share. The idea was to create a “supermedia” retailer that might be more competitive against such rivals as Best Buy Co. Inc. (BBY). But that offered fizzled.

In May, the company put itself on the auction block, a day after Best Buy announced plans to open stores in Europe via a $2.1 billion, 50-50 joint venture with London-based Carphone Warehouse Group PLC.

In June, Circuit City suspended its 4 cent dividend. And in September, President and CEO President Philip Schoonover resigned on the spot.

Circuit City has lost more than $5 billion in stock-market value in the past two years, Bloomberg reported.

Circuit City Files for Bankruptcy After a Year of Falling Sales and Corporate Cutbacks