Warren Buffett, the world’s second-richest man, is making an extraordinary donation to the foundation run by the world’s richest man, Microsoft CEO Bill Gates. In June 2006, Buffett announced that he constantly would give away 85% of his Berkshire holdings to five foundations in annual gifts of stock, beginning in July 2006. The largest contribution would go to the Bill and Melinda Gates Foundation. The rest of the money will go to four other foundations headed by Buffett’s three children, and to the foundation in his late wife’s name. The Gates Foundation focuses on global health issues, such as the GAVI Alliance to distribute vaccines to children in poor countries for diseases like malaria, HIV/AIDS, and, tuberculosis, to provide education, such as the United Negro College Fund Gates Millennium Scholars Program and developing libraries. Bill Gates and his wife Melinda Gates have been the only administrators of their foundation. But, later Buffet also joined them when the plan was started. Billionaire investor Warren Buffett planned to allocate more than $30 billion of his stock to the Bill and Melinda Gates Foundation. In 2008, Buffett became the richest man in the world dethroning Bill Gates, worth $62 billion according to Forbes. Bill Gates had been number one on the Forbes list for 13 consecutive years. In 2009, Bill Gates regained number one on the list according to Forbes magazine, with Buffett getting on second.
December 1, 2009
Warren Buffet Donated 85% of His Berkshire Holdings to Different Foundations
Google Acquisition of YouTube to Increase its Power in Online Advertising
On Monday, October 9, 2006, Google Inc. the Internet’s leading search engine declared its decision to purchase YouTube, the popular video-sharing site, for $1.65 billion in stock (assets). YouTube, which was started in February 2005, has quickly become the most famous of several online video sites. According to Internet research firm Hitwise, YouTube has approximately a 46 percent share of the online video market. 100 million videos are watched on the YouTube’s flash based site every day, including movie, TV clips and music videos, as well as amateur content. While Google has been riding away huge profits from the prospering search market, it could not become a major player in online video. The combination of Google and YouTube could increase Google’s power in online advertising, giving it an advantage over rivals such as Yahoo! (Charts), Microsoft’s (Charts) MSN and News Corp (Charts)., which owns the social networking site MySpace. Google had taken this decision speculating that the popular video-sharing site will favor it an increasingly advantageous marketing hub as more viewers and advertisers are migrating from television to the Internet. Google announced that two companies would be operated independently. As the Youtube’s agreement with Google appeared to be success, it announced new partnerships with Universal Music Group, CBS Corp. and Sony BMG Music Entertainment.
November 23, 2009
Fall of Wall Street had Huge Impact on Economy
The most sensational two days in Wall Street’s history are, on July 28, 2008 when Merrill Lynch agreed to sell itself to Bank of America for roughly $50 billion to reduce increasing financial crisis and on September 15, 2008 when another famous securities firm, Lehman Brothers, filed for Chapter 11 bankruptcy protection. These incidents affected the broader economy, which has been declining firmly as the financial crisis has aggravated over the last year, this led to the increase of unemployment and in turn slowed down nation’s growth rate. They ended up a weekend with distress and with continuous discussions, as Wall Street bankers gathered in meetings at the order of Bush administration officials to take decisions to avoid drop in the markets rising from a crisis of confidence. Because of the crisis, US government had requested the remaining two major investment banks Goldman Sachs and Morgan Stanley to convert themselves to be commercial banks. The Bush administration rushed to pass a $700 billion rescue of financial firms. The consequences of Merrill Lynch and Lehman Brothers would not seem to be connected, Merrill has the nation’s largest brokerage force and its name is famous in towns across America, while Lehman’s main customers are big institutions. But during the credit prosperity both firms piled into insecure or sensitive real estate and ended up severely damaged, with inadequate capital and toxic assets.
Bankruptcy of Lehman Brothers is recorded as the largest one
On September 15, 2008, Lehman Brothers filed for Chapter 11 bankruptcy protection. The bankruptcy of Lehman Brothers is considered as the largest bankruptcy filing in U.S. history with Lehman holding over 600 billion dollars of property. Lehman experienced an unusual loss due to the continuous real estate and financial crisis. The impact of Lehman’s bankruptcy is severe. It is expected to cause some reduction in the price of commercial real estate. Lehman experienced pressure to sell securities in commercial real estate to liquidate (to get cash) its properties. Several money funds or mutual funds and institutional cash funds had done serious hazard to Lehman as there is fall in the share value to below $1 for the banks like Bank of New York Mellon and the Primary Reserve Fund which are involved in institutional cash fund and money-market fund respectively. Apartment-building investors are also expected to experience pressure to sell properties, as Lehman discharges its debt and equity of $22 billion. The degraded moves which transformed the outlook of American finance marked the restless chapter in the year 2008. The once-proud financial institutions had been collapsed, as a result, loss of hundreds of billions of dollars is occurred because of bad mortgage finance and real estate investments.
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November 17, 2009
Financial Crisis is supposed to be recovered by 2011
Popular economists have declared the financial crisis of 2007–2009, the worst financial crisis since the one pertained to the Great Depression of the 1930s. It is responsible for the failure of important businesses, downfall in consumer wealth that is evaluated in the trillions of U.S. Dollars, acquisition of important financial commitments by government, and critical decline in economic activity. There are many causes for the economic crisis with varying consequence. With the increase in loan losses and the fall of Lehman Brothers on September 15, 2008, a big alarm broke out on the inter-bank loan market. The banks of United States and Europe experienced huge losses, faced bankruptcy and this resulted in massive public financial assistance. The effects of global recession are, sudden drop in the international trade, increasing unemployment and increase in prices of goods. Several economists have supposed that recovery from recession may not appear until 2011. Growth in financial or material demand, improper regulation and administration and increasing irregularity contributed to the economic crisis which in turn led to excessive increase of resource prices. It had a severe impact on the world. There is drop in the world stock markets, large financial institutions have collapsed, and even the wealthiest nations had introduced rescue packages to provide guarantee to their financial systems.