Kit Menkin's Leasing News

           Wednesday, June 19, 2002

Accurate, fair and unbiased news for the equipment Leasing Industry



Commercial Leasing of Louisiana---Kelly Hebert

 Leap in US housing starts boosts economic confidence

  Tyco Summer--A fish slips through the gill net

   Home equity loans fuel spending boom

     Bank of America sees profit in new branches

Declare Your Independence With Alaska Airlines' 4th of July Sale

 Bad news form Apple, AMD and Ciena prompts more selling

  Senate committee votes to close loophole on tax havens

    The Mystery of Tyco's Mark Belnick's Indignation    

        GE Cap. Launches Healthcare Financial Unit

          Citigroup Fills International Post w/Stanley Fischer

            Fleet Capital Leasing Selects mySAP CRM


### Denotes Press Release



 Centerpoint Financial, Colorado


This may be Chuck Brazier’s last day, and perhaps the last day of

Centerpoint.  If you have a salute to this industry leader with a lot

of courage, integrity, guts--- now is the time to speak your mind.




Commercial Leasing of Louisiana---Kelly Hebert


Have you ever heard of Commercial Leasing of Louisiana (Kelly Hebert), in Lafayette, LA,  or International Corporate Finance, based in

Miami, FL? I've been trying to track down these folks for six months.


A lady trucking company owner gave them $20,000, plus $295 processing

fees, to lease three trucks. After she got the trucks, licensed them and had the signage painted on them, they were repossessed by the dealer

because they never received their money.


Any information on these folks would help. All their phone numbers are no longer working.




Rene Tankersley




Leap in US housing starts boosts economic confidence


(It's the biggest percentage rise in almost seven years and a reversal of two straight months of falls. Full report at end of Leasing News. Editor)



WASHINGTON (AFP) - Groundbreaking on new US homes shot up by a seven-year record 11.6 percent in May, the government said, quelling fears that consumers may be flagging.


It was the steepest rise in housing starts since July 1995, easily beating Wall Street's forecast for an increase of 1.9 percent.


"Unlike other data that softened in May, housing activity strengthened. In our view, that suggests that the slowdown in retail sales in May was temporary," Merrill Lynch economist Bruce Steinberg said.


"Falling mortgage rates should keep housing activity robust," Steinberg said, noting that mortgage applications for home purchases had run at a record pace during the past month.


"Residential construction will make a sizeable positive contribution to second-quarter growth," he forecast.


Doubts about consumer spending -- accounting for two-thirds of US activity -- crept into the markets last week when the University of Michigan consumer sentiment index for early June slumped.


Those fears were fed by data showing retail sales took a surprise 0.9 percent drop in May.


Consumers have served as an engine of the US economic recovery, maintaining spending power even in the months after the September 11 attacks on New York and Washington.


But with business investment still the key missing ingredient of the recovery, any weakening in consumer spending would cast doubt over the sustainability of the upturn.


"After the retail sales number and drop of the confidence index of the University of Michigan for June, the big jump in housing starts shows consumer spending is still there and still responsive to low interest rates," Wachovia Securities chief economist John Silvia said.


Housing starts, which leapt to a seasonally adjusted annual rate of 1.733 million units in May, were strong in all major US regions, he said, lowering the likelihood of a return to US recession.


"It is encouraging," Silvia said.


"There is no risk of a double dip. It is a modest recovery, very similar to 1991-93 -- sort of a 'stealth recovery'; you don't really see it but it is there."


The data were typical of a "new economy" scenario, Silvia said.


"GDP is up, industrial production is up, for example, but you don't have a lot of employment growth because companies are achieving a lot of productivity gains."


Building permits also rose 2.6 percent to 1.674 million in May.


Other data Tuesday showed inflation tamed, allowing the US Federal Reserve to keep interest rates at their current 40-year lows without fear of pushing up prices.


The US consumer price index was unchanged in May from April while the core rate, excluding food and energy prices, rose 0.2 percent, the Labor Department said.


Consumer prices in May were up 1.2 percent year-on-year, while the core rate was up 2.5 percent year-on-year.




                       Tyco summer

                       a fish slips through

                         the gill net


                               ---  Al Gamper



 CIT, is a leading global source of financing and leasing capital and an advisor for companies in more than 30 industries. Managing $50 billion in assets across a diversified portfolio, CIT is empowering many of today's industry leaders and emerging businesses.


Founded in 1908, the Company's extensive history, solution-oriented

approach to its business and broad range of competencies has made it the financing leader in a variety of industries. CIT holds leadership positions in vendor financing, U. S. factoring, construction equipment financing, Small Business Administration loans, commercial aerospace, rail, corporate aircraft, printing, machine tools, asset-based and credit-secured lending


CIT's diversified lending practices and global capabilities enable the company to maintain a portfolio of businesses and retain an even keel in any economic condition. In addition to its traditional lines of business, the company consistently utilizes new technologies and advanced, Web-based services to provide commercial and consumer customers with cost-effective access to capital.


CIT has corporate headquarters in New York City; executive offices in Livingston, New Jersey; regional offices nationwide and in Canada; and strategic locations in Europe, Latin and South America and the Pacific Rim.


(As Leasing News stated yesterday, this stock is a recommend buy.  The company

is under valuated, will be run by the same board of directors that made it successful before, has an excellent staff, and a proven history of performance.  Don’t let the Tyco name interfere with you decision.  This is a solid company.

Tell your stockbroker to push this new issue. . However, there is strong rumor that the company may be bought for $4 1/2 billion. A hell of a bargain!!! Editor)



Home equity loans fuel spending boom


By Mike Freeman



As recently as January, Wells Fargo's Home Equity division employed 94 workers to process second mortgages and home equity lines of credit in a sleepy office in Carlsbad.


Today, the division employs more than 250 workers, and the "now hiring" sign is still out.


"We are planning to add 50 positions immediately and another 70 before the end of the year," said Mary Sykes, vice president of the bank's home equity operations in Carlsbad.


The division's hiring binge highlights the boost that low mortgage rates and soaring housing prices have given the economy.


Increasingly, homeowners are tapping their home equity as a money management tool, using it to pay for such things as remodeling, debt consolidation or college tuition for their children.


"A big part of the economy has been real estate, both building and refinancing, and that has had the effect of allowing consumers to keep spending," said Kelly Cunningham, an economist with the San Diego Regional Chamber of Commerce.


Wells Fargo's home equity division moved from Colorado to Carlsbad about 18 months ago with a handful of workers. The division manages the bank's second mortgages and home equity lines sold through a network of 6,000 independent mortgage brokers nationwide.


The operation expects to employ 700 in Carlsbad by the end of next year, Sykes said.


While most of Wells Fargo's customers tap their equity for remodeling or to pay off high-interest consumer debt, others are using second mortgages to actually buy new homes.


These buyers take a second mortgage to reach the 20 percent down payment level, which allows them to avoid paying for a mortgage insurance policy. Lenders usually require mortgage insurance when a down payment is less than 20 percent.


In addition, first-time home buyers are taking out lines of credit to pay for window coverings, landscaping, new carpets and other improvements.


Some economists and real estate analysts, however, worry that consumers are stuffing themselves on mortgage debt.


Compared with other forms of borrowing, mortgages have the advantage of low interest rates, and the interest is tax deductible. But as buyers stretch their finances to afford increasingly expensive homes, especially in markets like San Diego where the median home price has climbed to $315,000, mortgages are taking an increasingly bigger bite out of borrowers' paychecks.


According to the Federal Reserve, the percentage of household personal income going toward mortgage payments has increased 45 percent since 1980, when the central bank began tracking the statistic.


The average size of a mortgage in San Diego County climbed to $272,500 in May, according to DataQuick Information Systems, a La Jolla industry research firm. That's up from $242,150 in May 2001.


Local mortgage brokers say lenders are approving home loans where the monthly payments gobble up 50 percent or more of a borrowers' monthly income.


In the past, lenders wanted no more than a third of monthly household income going to pay the mortgage.


"We're getting to 60 percent or 70 percent of income as long as their credit is good," said Gary Reime of Five Star Mortgage in San Diego. "It just blows you away how much easier it is to get a home loan today than it was five years ago."


Usually move-up buyers – not first-time homeowners – qualify for hefty debt-to-income loans, said Reime. Sophisticated credit scoring systems by companies such as Fair, Isaac and Co. have made lenders more willing to approve these loans.


"It has been proven over time that people with high credit scores . . . know how to take care of their credit," Reime said.


Chris Hammond, a Wells Fargo spokesman in San Francisco, said borrowers should be careful when considering piling on mortgage debt, including second mortgages and lines of credit. The bank "has stayed true to our risk policies" for making such loans, he added.


But with 11 interest rate cuts by the Federal Reserve since the economy began to sour, "The fact is a home equity account becomes an extremely attractive source of funds," Hammond said. "Across the board we continue to see values in homes appreciate. That equity is an asset that the homeowner has a right to use."


Mike Freeman: (760) 476-8209;



Bank of America sees profit in new branches




CHARLOTTE, N.C. – Bank of America Corp. plans to begin opening about 200 branches a year as the nation's biggest consumer bank tries to boost profits in California, Texas and Florida.


Chief executive Kenneth Lewis spoke about the reorganization plan, to begin in 2003, at a conference in New York last week. It's part of a strategy to sell more services such as credit cards, mutual funds and home loans.


The Charlotte, N.C.-based bank plans to close about 50 U.S. existing branches in 2003, resulting in a net gain of 150 branches next year, spokesman Scott Scredon said.


Opening branches "is cheaper and will probably prove more successful than making an acquisition to gain customers," said Wayne Bopp, a bank analyst for Fifth Third Bank in Cincinnati, which manages $33 billion and owns 140,000 Bank of America shares. "When you grow internally, you can pick the street corners you want to be on."


The expansion follows the bank's closing of more than 460 branches since the 1998 merger of NationsBank Corp. and BankAmerica Corp., according to financial reports. Bank of America now has more than 4,200 branches.


Lewis has cited California and Florida, where the bank has the largest share of deposits, and Texas, where it ranks second, as markets where fast-growing populations provide opportunities for "cross-selling" profitable services.


Commercial and consumer banking, which account for two-thirds of the bank's operating profit, earned $1.42 billion in the first quarter, up 11 percent from a year earlier.


Shares of Bank of America are up 18 percent this year, fourth best among the 28 members of the Standard & Poor's 500 banks index. The shares rose 64




Classified Ads at Leasing News Work!!!


 ( they are free and they work!!! )


Here are 32 aggressive, experienced, top people---no recruiter fees, no

employee fees, these people are “filtered” as being the best available.


Asset Management: Silicon Valley, CA

Experienced Asset Manager with SMT/PCB equipment focus. Managed/sold large ticket mid-term and EOL transactions with global contract manufacturer and OEM accounts.

Asset Management: Nashville, TN

Experienced Asset Manager with construction/ telecom focus. Managed portfolio of repo & EOL transactions for large leasing companies. 10 years experience including sales & credit/ collections focus.


Collector: Oceanside, CA

Collections supervisor, experienced with commercial leasing. motivated, good work ethic, enthusiastic. call (760)941-9209

Contract Administrator: San Diego, CA

work-at-home position to perform processing & documentation. 5+ years small ticket arena, used to handling a 25-30 deal workload. You do the sales, I'll do the rest.


Contract Administrator: Schaumburg, IL

10 yrs. small/mid-ticket leasing. Proficient in documentation, funding and legal. Worked with brokers, portfolio purchases, vendor programs, municipal transactions. prefer to stay in Suburban Illinois.

Contract Administrator: Los Angeles, CA

6 years small ticket leasing - Credit Analysis up to $75,000, Documentation & Funding. Highly organized team player trained sales/operations in credit, pricing, docs.


Credit: Columbia, SC

Seasoned senior credit professional with 14 years experience in small ticket. Strong analytical skills, spreadsheet proficiency, all types financials, tax returns. Looking for new career in Southeast/Mid Atlantic

Credit: Hayward, CA.

Versatile/ creative senior financial executive w/ extensive experience in varied areas of the commercial lending environment. Strong written/ oral skills with a results-oriented team-player attitude. Email:


Credit: Vista, CA

+15 years experience structuring, underwriting, and collecting leases to privately and publicly held companies. Creative and results oriented. Proven ability to achieve bottom-line results.

Credit: Mill Valley, CA

Senior corporate officer with financial services credit background. M and A, fund raising and workout expertise.


Credit: Los Angeles, CA

Over 15 years experience in Credit/Operations with Small Ticket and transactions up to $500,000.00. CLP, with excellent relationships with most major lenders.

Finance: Atlanta, GA

Twenty five plus years experience in middle market lease/ asset based/cash flow transactions. Heavy banking and credit background, with particular expertise in structure and negotiation.


Finance: Birmingham, AL

Admin./International: 10+years global ops mgmt. int. biz admin.w import/export/reg. compliance, global biz development, in, transaction P/L, global recruitment/training/staff mgmt. middle market to Fortune 20 account development.

Funding: Northern, NJ

Coordinate all aspects of financing for leased equipment, prepare necessary documentation for discounting with banks.Handle renewals of and amendments to lease schedules.


Legal: Chatsworth, CA

Managing attorney for general corporate and financial services law including: leasing, acquisitions, service agreements, commercial loans, securitizations, workouts and litigation.

Operations: Phoenix, AZ

15 years of increasingly responsible positions as a financial-marketing manager in commercial leasing, credit, and collections. Extensive experience in leasing and accounts receivable portfolio management.


Sales: Phila, PA

Proven Aggressive Winner w/strong prospecting skills,vendor program exp. both captive/non- captive, territory mgmt on all levels, remote office for many years, very adaptable.

Sales: Silicon Valley, CA

9 years Leasing Exp. small/medium ticket arena , Proven overachiever/exceeding company goals, vendor & direct. Home office for several years, Currently in IT leasing.


Sales: Boston, MA

Boston, MA (big Patriots' fan) Senior Sales person, 15 years experience, strong vendor program background, middle market concentration

Sales: Houston, TX

Experienced outside salesman, seeking Direct Leasing company position either on an independent or employee basis.


Sales: Louisville, KY

I have been in leasing/financing of construction, machine tool, and mfg equipment for 20+ years. Traveled KY, IN, OH and TN.

Sales: Chicago, IL

MBA w/ "C" level relationships. Extensive sales/ sales management exper. in new business development w/end-user, vendor and captive programs. Very adapt at complex credit/ economic lease structuring. Email:IrishReel@AOL.Com


Sales: Silicon Valley, CA

VP level Business Development and Sales Manager, well connected in Silicon Valley. Experienced in major vendor programs on a global basis.Email:

Sales: Dallas, TX

Director, Business Development for international financial institutions. Global vendor programs with minimum sustainable volume of $24M annually. CFO and Treasury contacts with major technology and energy


Sales: Mission Viejo, CA

Account Sales Executive with 10 years of leasing experience looking for company to bring existing customer base.

Sales: Atlanta, GA

Prof. sales person with 12+ years of leasing, biz development, structuring, credit & closing. Profitable book of business/ contacts in the small-mid ticket arena.


Sales Manager: Atlanta, GA

15 years experience in Small Ticket Vendor Leasing. Managed sales team for eight years in Copiers, Telecom, IT, Construction, Auto Aftermarket, etc.

Sales Manager: New York, NY

I have over 25 years owning an independent leasing company that specialized in truck leasing. Tow trucks, Limos, ambulances, tractors, etc..


Sales Manager: Hartford, CT

Director of Equipment Lease Division with credit/collateral evaluation, marketing & operations experience. Simultaneously coordinated efforts to develop new vendor business.

Senior Management: Hicksville, NY

Senior equipment leasing and banking executive with credit, collections, marketing and operations experience. Background includes development of new business,risk management and budgeting.


Senior Management: Irvine, CA

Senior Manager at Enterprise Leasing Software Company. 10 yrs programming, 15 yrs system/ network, and 15 yrs management experience. Working Experience with 12 Leasing companies.

Syndicator: Wilmington, NC

Ten years experience/contacts placing debt & equity for middle market end-users for transactions



Forty-Seven Help Wanted


Ten Outsourcing


Three attorneys (no Ken Greene here, don’t know why)


Leasing Recruiters ( you won’t find this in the Monitor, or elsewhere.

Here are leasing recruiters who specialize in the leasing industry.  They

generally work for the leasing company, but you should comment

them directly.  You might be the right person for the right job.  All

they can tell you is “no.”


Other places to go to post or look. Network. Talk to your friends, your colleagues,

don’t sit depressed that you will never find a job because you live in Portland

or Denver or Tempe, Arizona.  Remember, God works in strange ways because

we don’t understand it.




Declare Your Independence With Alaska Airlines' 4th of July Sale


  (Great Airline---Support you economy, get out of your doldrums and go

 somewhere for the first week of July. Surprise you loved one and "go for it!"


    SEATTLE----It's time to celebrate the Fourth of July with Alaska Airlines and take advantage of special fares to most cities in the Alaska Airlines and Horizon Air system, including the nation's capitol and Boston.

    Travelers can find big savings off Alaska's already low fares by traveling outbound July 1 or 2 and returning July 5, 8 (after 6 p.m.) or 9. Or save even more-- up to 50 percent off by traveling on the Fourth of July.

    Sample fares each way, based on roundtrip purchase are:



                                               saver         super

Between                                        fare(a)       saver(b)

-------                                        -------       --------

Anchorage and Fairbanks                        $55...........$45

Anchorage and Seattle                          $150..........$130

Nome or Kotzebue and Anchorage                 $160..........$150

San Jose and Seattle                           $49...........$44

Oakland and Seattle or Portland                $49...........$44

Reno and Portland                              $49...........$44

Spokane and San Francisco                      $59...........$54

Burbank and Seattle or Portland                $84...........$79

Spokane and Orange County                      $89...........$84

Las Vegas and Seattle                          $79...........$74

Phoenix and Portland or Spokane                $79...........$74

Tucson and Seattle                             $79...........$74

Seattle and Washington, D.C. or Boston         $134..........$129

Denver and Portland                            $114..........$109

Boise and Denver                               $104..........$89

San Diego and Boise                            $104..........$89

San Francisco and Vancouver, B.C.              $49...........$44

Phoenix or Tucson and Vancouver, B.C.          $79...........$74

Los Angeles and Vancouver, B.C. or Calgary     $84...........$79


(a) Saver fares are for outbound travel July 1 or 2 and return travel

July 5, 8 (after 6 p.m.) or July 9.

(b) Super Saver fares are for travel July 4.






    Tickets must be purchased by July 4, and travel must be completed by July 9.

    These fares cannot be combined with other fares. Fares do not include airport passenger-facility charges of up to $18 (amount depends on itinerary); federal segment tax of $3 per takeoff and landing; and the September 11th Security Fee of $2.50 per enplanement, up to $10. Fares to Canada do not include Canadian airport improvement fees, which vary by airport; Canadian security fee of $8; and the U.S. immigration fee of $6.

    Tickets may be changed for a $50 fee, plus any applicable changes in fare. Seats are limited and may not be available on all flights or on all days.

    The nation's ninth largest carrier, Alaska Airlines celebrates its 70th anniversary this year. The carrier was recently ranked No. 1 in the annual Airline Quality Ratings compiled by Wichita State University and the University of Nebraska at Omaha. Alaska and its regional partner, Horizon Air, together serve 80 cities in the Lower 48, Alaska, Canada and Mexico. For reservations go to, call Alaska's toll-free reservations line at 1-800-ALASKAAIR (1-800-252-7522) or




Bad news form Apple, AMD and Ciena prompts more selling



By Lisa Singhania




NEW YORK – Warnings from Apple, Advanced Micro Devices and Ciena pressured the tech sector Wednesday, sending stocks lower as investors again grew pessimistic about the chances for a second- quarter pickup in business.


But the losses eased as the session wore on, suggesting that the selling was selective. Trading was relatively slow, making stock prices more susceptible to sharp swings.


By late morning, the Dow Jones industrial average was down 25.48, or 0.3 percent, at 9,680.64, after rising 231 points over the first two days of the week.


Broader stock indicators also fell. The Standard & Poor's 500 index was off 4.26, or 0.4 percent, at 1,032.88, while the technology-focused Nasdaq composite index slid 8.42, or 0.6 percent, to 1,534.54.


Apple Computer tumbled $2.80, or nearly 14 percent, to $17.35 after saying revenues and profits would be lower than predicted because of soft demand for its products. A similar warning, as well as prediction of a substantial operating loss, sent Advanced Micro Devices down $1.20, or 11.7 percent, to $9.10.


Ciena fell 41 cents to $3.99 after the company said lower third-quarter revenue was possible because of the difficult telecom environment.


The selling spread to other technology stocks, including AMD competitor Intel, which dropped $1.32 to $20.70.


The news was the latest confirmation that a much anticipated turnaround in technology – and the broader market – might not happen, or at least will be much less robust than hoped. Stocks have been falling all month on a mix of earnings and profit warnings from companies ranging from Intel to Abbott Laboratories. Although there have been occasional bursts of buying, stocks have failed to overcome the mostly negative momentum that has been weighing on stocks for weeks now.


Investors weren't universally negative, however. Defense stocks, which have been moving higher for months now on expectations the sector will benefit from the war on terrorism, advanced again. Lockheed Martin gained 96 cents to $69.21.


TRW rose 5 cents to $55.75 on word it was selling its aeronautical systems businesses to Goodrich for $1.5 billion. Goodrich was down 1 cent at $29.30. Northrop Grumman, which has been trying to buy TRW for four months, rose $2.80 to $132.50.


Advancing issues traded nearly evenly with decliners on the New York Stock Exchange. Volume came to 333.08 million shares, compared with 364.01 million issues at the same point Tuesday.


The Russell 2000 index rose 3.34 to 473.05.


Overseas, Japan's Nikkei stock average fell nearly 3.4 percent. In Europe, Germany's DAX index fell 1.1 percent, Britain's FTSE 100 was down 1.1 percent, and France's CAC-40 lost 1.6 percent.




On the Net:


New York Stock Exchange:


Nasdaq Stock Market:




Ron Caruso’s name was corrected on the On Line version of Leasing News.

I called and personally apologized to him. No insult to this veteran, who told me on the telephone the downturn in the leasing industry also affects the executive recruiting business.





Senate committee votes to close loophole on tax havens, boost charitable giving


By Jim Abrams, Associated Press,


WASHINGTON (AP) The Senate Finance Committee on Tuesday approved new tax incentives for charitable giving in a package that also cracked down on U.S. companies relocating to tax havens such as Bermuda.


A third part of the legislation, passed by voice vote, would require more detailed reporting of tax shelters and would impose fines for failing to acknowledge such transactions to the IRS.


Several high-profile companies have recently relocated their headquarters to Bermuda or are in the process of doing so to take advantage of lower taxes, and the Senate Finance bill is one of several in Congress aimed at stopping the practice.


It would eliminate a loophole in the tax code ''that lets a corporation, with nothing more than a file folder or post office box in a tax haven country, escape millions in U.S. taxes,'' said committee chairman Sen. Max Baucus, D-Mont.


The measure would classify a corporation that relocates overseas as domestic and subject to U.S. taxes if the original shareholders of the company continue to own 80 percent of the stock after the move.


The charitable giving part of the package would allow taxpayers who donate more than $250 to deduct the amount of their contributions up to $250. To keep the cost of the program down, the deduction would expire in two years.


The tax break is a part of a larger ''faith-based initiative'' pushed by President Bush and congressional Republicans to open government programs to religious groups. After the vote, Bush urged passage by the entire Senate, White House press secretary Ari Fleischer said.


''This common sense legislation ... not only encourages Americans to give but creates a level playing field for faith and community based organizations,'' Fleischer said.


Sen. Rick Santorum, R-Pa., co-sponsor of the faith-based initiative with Sen. Joe Lieberman, D-Conn., said the bill would provide immediate help to smaller faith and community-based groups and urged Senate Majority Leader Tom Daschle, D-S.D., to move quickly on the package.


All three parts of the tax bill face an uncertain future. Baucus said the charitable giving measure should be given a chance because it was a top priority of the president, but also noted that such deductions had been tried in the past and had been eliminated in 1986 because they didn't work well.


''Specifically, I am concerned that the deduction won't provide much incentive for charitable giving and will make the tax code more complicated,'' he said.


The attempt to crack down on tax havens is opposed by the Bush administration, which prefers a moratorium on relocations to allow time to consider larger tax issues.


House Majority Leader Dick Armey, R-Texas, criticized such legislation Tuesday, saying, ''Democrats have gotten all the blood they could out of the old Enron turnip, they're now trying to find something else to squeeze a little political blood out of.''


The committee also approved an amendment offered by Sen. Charles Grassley, R- Iowa, to set up a pilot program giving a dollar-for-dollar match for lower income families who save up to $500 a year, or $2,500 over five years, to purchase a home or business. The program would cost $450 million over nine years.


The bills are H.R. 7, S. 2498 and S. 2119





The Mystery of Tyco's Mark Belnick's Indignation



By Michael Lewis, Bloomberg



I'd never heard of Mark Belnick, the former general counsel of Tyco International Ltd., until he brought himself to the world's attention last week with a series of extraordinary press releases.


On June 10, Tyco released a terse statement saying Belnick had been replaced, without explaining why. Two hours and eight minutes later, Belnick issued his first angry public response.


"Mark Belnick is an outstanding lawyer of sound judgment and unquestionable probity," the statement began. "Tyco is a company in distress and chaos as a consequence of the inappropriate conduct of its former Chairman who was indicted for sales tax fraud in New York State."


Having sold out his former boss, Dennis Kozlowski, in the court of public opinion, Belnick went on to accuse the people who fired him of engaging in "a legal turf war."


Tyco responded with a second press release, which claimed that "the Company had lost confidence in Mr. Belnick's willingness and ability to conduct a fair and complete investigation" of allegations of improper conduct by Tyco officers. The conglomerate called Belnick's press release a bid by his lawyer "to distract attention from his client's serious problems."


Two hours and 29 minutes later, Belnick released his final statement, which said "any suggestion that Mr. Belnick was impeding an investigation of himself is preposterous" and that Belnick was "working closely" with government investigators.


My first thought when I read this odd exchange was: when the public relations spin is this rich, who needs investigative journalism? My second thought was that Belnick must be innocent of wrongdoing. No one who was guilty of anything would be so foolish as to challenge the first Tyco press release. He could lay low and allow the storm to pass. By making a stink, Belnick drew attention to himself that he might otherwise have avoided. No one who is blameless does that.


But then all these tidbits began to spill out about Belnick. The first, which I discovered in reports on insider sales from the Washington Service, was that he had dumped essentially all of his remaining Tyco holdings in 2001, before the stock's 75 percent plunge this year.


He filed for his last sale -- 116,666 shares at $58 and change -- on Dec. 4, the day after Enron Corp. filed the largest bankruptcy in U.S. history and two months before Tyco disclosed a $20 million payment to former director Frank E. Walsh Jr. that triggered the biggest slide in Tyco shares in at least two decades.


The second tidbit was Tyco's allegation in a lawsuit filed against Belnick that in less than four years of service he received $35 million in compensation that was not approved by the board or disclosed to shareholders. His attorney, Stanley S. Arkin, responded that Belnick's pay was "disclosed to and approved by the appropriate corporate authorities at Tyco." I don't know which is worse: that the compensation was undisclosed to the rest of the world or that a general counsel was paid $35 million for his services.


The third tidbit was the Wall Street Journal's report that Belnick had written into his employment contract that he would be paid as much as $7.1 million if he was fired before October 2003 for committing a felony. Arkin popped up to say that this sort of clause was "not unusual" in employment contracts. Inside organized crime, perhaps, but surely unusual outside of it.


Arkin last night called the lawsuit a "legal mugging" and said in a statement that Tyco's claims against his client were "baseless" and a "shabby and transparent tactic by individuals at Tyco with a personal animus against Mr. Belnick to divert focus from their own gross breaches of trust."


Yet clearly Belnick isn't innocent in any meaningful non- legal sense of that word. He may not be guilty of anything that sends him to jail or of the allegations made against him by Tyco, but he's at the very least guilty of fantastic greed. So his press releases are a mystery.


Until June 10, Belnick was exactly the sort of character about whom we would all tut-tut for a day and then instantly forget, as we returned our gaze to the more lurid behavior of The Great Kozlowski. By Belnick's own deliberate actions, he made himself into something bigger, and less ignorable. Why?


I can think of two possible answers. The first is that perhaps the problems inside Tyco are worse than we all know, and Belnick knows it. He has figured out that when the full extent of what happened inside Tyco becomes widely known, the public will demand scalps.


If you believe Tyco's claims, Belnick was at the time of his firing impeding the internal investigation spawned by Kozlowski's indictment and the subsequent allegations that corporate funds were misused. Reading between the lines of his own releases extolling his cooperation with investigators, he may have been trying to cut a deal for himself with the Securities and Exchange Commission at the same time.


Belnick has been in the business long enough (he once defended Michael Milken) to know deal-cutting is a political game, and that the government probably won't cut a deal with anyone who is likely to emerge as one of the chief villains of the piece. Perhaps his press releases were a desperate attempt to make himself seem like the sort of guy with which a government investigator can cut a deal without later being made to look like a dupe.


The second possibility is that Belnick actually believes in his own innocence. We live in strange times, when a giant corporation can go from highly respected to widely scandalized in a matter of hours, and can be tried and convicted in the court of public opinion without so much as a by-your-leave. It's hard to ask people to undergo a similar transformation in how they think of themselves. When you have been applauded for years, you are not likely to think of your behavior as bad, even if it was.







#### ########################## #####################


GE Capital Launches Healthcare Financial Services Business Unit


GE Capital announced the formal launch of a new business unit, GE Capital Healthcare


Financial Services, focused on providing capital, financial solutions and related services to the healthcare industry. This action brings together in a single business the healthcare-related expertise, assets and capabilities from several GE Capital businesses as well as Heller Financial, which the company acquired in October 2001.


With $9 billion in assets, GE Capital Healthcare Financial Services is one of the largest financial service providers dedicated to this diverse industry. GE Capital offers a comprehensive range of financing products, from equipment leasing and real estate financing to working capital lending and equity investing. Customers represent all sectors of healthcare including providers, such as hospitals, outpatient centers, skilled nursing and assisted living facilities, as well as companies who service the provider community.


The Center for Medicare and Medicaid Services, a government regulatory agency, estimates the size of the US healthcare market at $1.4 trillion for 2001 and projects growth of 7% annually through 2010. In addition, GE Capital research estimates the size of the international market at $3.5 trillion in 2002 with a 3% annual growth rate.


"The healthcare market is a large and growing one, both domestically and internationally, providing strong opportunities for quality financial service providers," said Denis J. Nayden, chairman and CEO of GE Capital. "We believe the combination of our deep industry expertise, wide range of products and services and core focus on helping customers to achieve their business objectives, will clearly differentiate us in all sectors of this growing marketplace."


"Our goal is to be the industry's most dependable partner and trusted advisor when it comes to financing decisions within healthcare," added Rick Wolfert, president and CEO of GE Capital Healthcare Financial Services. "Our intent is to use our financial expertise and industry knowledge to help customers improve their profitability, productivity and competitive position."


GE Capital Healthcare Financial Services' website is


(It is said GECC earns 40% of the revenue for GE, and in the last ten

years they have made over 900 acquisitions.  All this information is

combined into a data base that allows every application to learn

of their total exposure in granting credit.  If it reaches a certain

exposure, the new transaction may be declined.  To continue its

growth, this exposure point may be raised, but then again, the

SEC and general stock market may have input in this decision.

Certainly GECC needs new markets, it evidently is not in South

America and perhaps Europe or Russia or the middle East or Africa.

China? Editor)


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Citigroup Fills International Post




Citigroup announced today that it had named Stanley Fischer as president

of Citigroup International, a newly formed unit that will include the company's troubled emerging markets business.


Mr. Fischer, formerly second in command at the International Monetary Fund, joined Citigroup as vice chairman in February. He will continue to hold that post, reporting to Robert E. Rubin, chairman of Citigroup's executive committee and secretary of the Treasury in the Clinton administration.


In his new position, Mr. Fischer will work with Sir Deryck C. Maughan, who

was named last week as chief executive of Citigroup International.


The new unit, which will include all of Citigroup's operations outside North America, was formed in the wake of the large losses that Citigroup's emerging markets business suffered in the recent Argentine financial crisis.


Sir Deryck was named head of the unit in a reshuffling of top management and a centralizing of the company's global operations.


Mr. Fischer, former first deputy managing director at the monetary fund and a leading world economist, is perhaps best known for guiding the I.M.F. in the Asian and Russian financial collapses in 1997 and 1998. He was an important figure in organizing international aid packages to help rescue those economies.


When his appointment as vice chairman of Citigroup was announced in December, it was regarded as a step in enhancing the company's international standing. He worked to increase Citigroup's business with governments and corporations in both industrial nations and emerging markets.


With assets exceeding $1 trillion, Citigroup operates in more than 100 countries.


The banking company's chairman and chief executive, Sanford I. Weill, said, "In the few months that Stan has been with Citigroup, he has already made an invaluable contribution, thanks to his extraordinary knowledge and expertise of the global economy."




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Fleet Capital Leasing Selects mySAP CRM


SAP AG announced that Fleet Capital Leasing, a leading global provider of equipment

leasing and financing to Fortune 1000 companies and a subsidiary of FleetBoston Financial, has selected Leasing and Asset Management with mySAP Customer Relationship Management (mySAP CRM) to manage its equipment leasing operations worldwide. The selection marks the third major global leasing corporation to choose the solution from SAP. The announcement was made at the Equipment Leasing Association's Business Technology Solutions Conference and Exhibition in Philadelphia.


Leasing and Asset Management with mySAP CRM will provide Fleet Capital Leasing with a single platform to support the entire lease lifecycle, from initial customer contact through end of lease and disposal of the residual asset. Migrating to this single platform will allow Fleet to manage its customer relationships in a much more efficient manner.


"This single, global, scalable platform will allow us to better serve our diverse customer base with a multitude of leasing solutions," said Ron Chamides, president of Fleet Capital Leasing. "We are always striving to create an industry-leading customer experience, and we're pleased that SAP is able to help us achieve that goal."


Fleet Capital Leasing will also use the solution to serve the unique demands of its international customers. The global solution includes multi-language, multi-currency, and specific leasing capabilities, including parallel valuation according to multiple international accounting standards such as IAS, US-GAAP, and other local accounting rules. These capabilities will empower Fleet Capital Leasing to meet the needs of its growing international customer base, utilizing completely integrated operational tasks such as opportunity management, financing, contract and asset management, maintenance, and customer service on a global basis.


"The entry of enterprise solution providers (such as SAP) into the leasing solution marketplace, gives lessors the opportunity to integrate front and back office business processes (an otherwise very costly process) so they can readily integrate channels and deliver better customer service," said John Van Decker, Senior Program Director, META Group. "Lease management life-cycle solutions can enable lessors a route to greater profitability as internal and external participants collaboratively share information real- time, reduce the time to negotiate/create a lease, improve decision making, and ultimately, reduce the cost of each transaction."


Leasing and Asset Management with mySAP CRM provides a comprehensive end-to- end solution for all companies that lease equipment. The solution was designed to drive revenue and streamline administrative efforts across key business processes for all financing companies. It provides the leasing industry with unrivalled capabilities in integrated customer relationship management, quote-to-contract management, and the management of the complex financial transactions associated with leasing operations in diverse international and domestic lines of business.


"SAP offers the only proven enterprise solution available today with capabilities that support all steps in the financing contract lifecycle. It enables a seamless transition to mid-lease changes and resulting end-of-lease options and re-marketing for the leasing industry," said Brian Madocks, senior vice president and general manager of the Services Sector at SAP America, Inc. "The selection of SAP by Fleet Capital Leasing continues our momentum as leading leasing companies embrace SAP's vision for this market, our solution's powerful combination of comprehensive industry-specific functionality, state-of-the-art customer relationship management capabilities, our ability to execute against our promises, and our ability to service our customers."


More information is available at Fleet Capital Leasing's website at Additional information about SAP is at http://


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**** Official US Housing Start Statement, sent by

  Carl Villella, CLP

Onyx Capital Corp.

8150 Perry Hwy. Suite 211

Pittsburgh, Pa. 15237


412-366-9144 fax


412-980-6139 cell


Starts were stronger than expected in May increasing 11.6%  to a 1.733 million rate (SAAR).  Single-family activity was also very strong, up 9.6% to a SAAR rate of 1.389 million.   Even the multi family sector was strong, up 20.3%.     Permits, an indicator of future activity, were up a more modest 2.6% (1.674 million SAAR) with most of the strength in the multi family/apartment category. Regionally, starts were up in all regions as follows: NE up 22%; MW up 24%; south up 6%; and West up 10%.




Analysis and outlook:  Housing fundamentals remain solid.   Sales of new and existing homes set records in 2001, and have been equally strong this year.  Mortgage rates, a key determinant, averaged 6.81% in May and are even lower in June, averaging 6.71% to date (Fannie Mae, 30 year fixed rate commitments); consumer confidence is improving; inflation (CPI and PPI) is benign thanks to very strong productivity increments; after tax income gains continue; and builders are maintaining good supply/demand balance with May inventories still below 5 months supply.  Furthermore, with the demise of equity markets over the past two years, more and more people are diverting capital to real estate opportunities, particularly residential construction.  The value of owner occupied real estate, adjusted for inflation, increased 10% in 2000, about 8% in 2001, and is up approximately 6% in 2002 through the 1st Qtr.  This is actually causing some problems as robust home equity appreciation is beginning to impact affordability as a growing number of Americans find that it takes a higher percentage of their after tax income to make the mortgage payments. Is the housing market overheated?  Most analysts say no (there are a few exceptions in some large Metro regions), but affordability is starting to become a problem for more prospective buyers.


The key to solid housing demand is interest rates, consumer confidence, and the employment picture.   Employment will be slow to improve as corporations cautiously add new employees only when they are convinced capacity utilization is more favorable, and plants are still running below 80% capacity.   On the interest rate front, many analysts believe the Fed will refrain from raising rates this year, as productivity is helping to keep inflation at acceptable levels, and the economic recovery remains fragile.  There are two key factors to watch as either can significantly impact confidence, inflation/interest rates, and employment.  One is the U.S. dollar.  By some measure, it is as much as 20% overvalued, fueled by the U.S. economy's position as the world's premier economy through much of the past 6-7 years.  However, it is starting to lose some of its luster, particularly during the past three months as foreign investors begin to question the U.S. recovery, and look elsewhere for investment opportunities.  An orderly depreciation would be beneficial to the U.S. economy (e.g. boost exports), but a rapid fall would fuel inflation, and this would force interest rates upward rather quickly.  The other factor, of course, is the degree to which the world is able to contain terrorism.  This affects both individual confidence and that of businesses - when we lose confidence, we simply don't invest as much.


NAHB's latest housing outlook (June 2002) calls for 1.628 million starts in 2002 (1.306 million Single family). This outlook assumes the Fed leaves interest rates alone for most of the year,  (this assumes the dollars' slide is orderly) and there are no major additional terrorist attacks similar to September 11th. 



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