Advice Entries :: Displaying 2 entries
| [Ask a Question] |
| Zach from Chicago asks… October 7th 2008 at 03:27:28 PM "Economists and financial pundits have discussed many aspects of the Fed's attempt to revive the credit markets and potentially bailout the Street, but only so far as they pertain to large corporates and bulge bracket financial institutions. What impact will recent Fed actions have on small and mid-cap firms? " |
| Answer by CIP Dear Zach: Clearly the situation with the credit markets in the U.S. and abroad is greatly impacting our economy and stalling a recovery. The stock markets are very weak and erratic. In our work with community banks, we are currently seeing and hearing that the fundamental aspects of banking are intact. However, the tightening of credit markets is making it more difficult for banks to raise capital (if they need it to grow), and this means that even banks that are well capitalized are ratcheting up lending requirements and collateral. This greatly impacts small businesses and individuals throughout the country. Small, mid cap and large companies alike are dealing with the current climate by prudently managing capital through cutting spending, layoffs, and other means at their disposal. The economic rescue plan needs to un-freeze credit markets, provide liquidity, and instill a sense of optimism that we will emerge from this current situation sooner rather than later. Increasing the FDIC insurance limit to $250,000 is a positive measure and provides a greater level of confidence to small business owners. But this is just one measure of many courses of action to be taken. It will certainly take time to analyze the benefit of the $700+ billion dollar rescue plan. Public and private American businesses are resilient – we will get through this mess. Respectfully, The Capital Insight Partners Team |
 |
| Zack at NewRulesofInvesting.com from Jerusalem, Israel asks… October 2nd 2008 at 02:16:03 AM "I read recently that the SEC is allowing (in a limited fashion) publicly traded firms to use their websites (as opposed to the wire services) to disseminate announcements. Is this true? Does this mean blogs/websites might become the preferred method for disclosing information? " |
| Answer by CIP Dear Zack - Thanks for participating in our online Q&A forum which is designed to facilitate discussion about important investor facing issues, such as the disclosure of material information on corporate IR websites. Your question is timely and clearly this is a topic which many public companies are discussing today. We have reviewed the SEC's interpretive guidance on the use of company websites for the purposes of proper disclosure to investors. The most recent and extensive SEC comments on this issue can be found at the following link: http://www.sec.gov/rules/interp/2008/34-58288.pdf. It is important to note that the SEC is soliciting comments on their interpretive guidance. The SEC appears to be recognizing the changing landscape, in which corporate IR websites play a vital role in facilitating open and direct communication with a public company's shareholders. No longer are publicly accessible news releases and investor conference calls the only means of communicating. As you know, transcriptions of investor conference calls are now appearing on large financial blogging portals such as www.seekingalpha.com. This means that past issues of selective disclosure which can occur on conference calls, can be remedied by directing shareholders to view a transcript of a conference call to review any material disclosures, which may not have been included in a company's earnings release or SEC filing. From the SEC's recent interpretive guidance: "In order to make information public, it must be disseminated in a manner calculated to reach the securities market place in general through recognized channels of distribution, and public investors must be afforded a reasonable waiting period to react to the information." It certainly appears that the SEC believes that many IR websites are becoming "recognized channels of distribution". Additionally, financial blogs, portals, and corporate IR websites will continue to grow with respect to their level of importance in corporate communication with shareholders. However, based on current SEC guidelines, companies should still disclose material information through a news release distributed through a wire service, followed with an 8K filing with the SEC. We should all stay tuned for final guidance from the SEC on this issue. Respectfully, The Capital Insight Team |
|
[Ask a Question] |
Displaying 2 entries |