Northern Trust (NASDAQ: NTRS) had a great time with taxpayer money. It spent $6.3 million for an LA bash featuring a golf tournament, spa treatments in posh hotels, and musical performances from Sheryl Crow, Earth Wind & Fire, and Chicago. Who paid? We did -- that's because Northern Trust took $1.6 billion in TARP money.

But from now on Northern Trust is going to have to use its own money if it wants to pamper its executives. Thanks to all the wonderful publicity it's received about its lavish spending, it has decided to pay back the $1.6 billion that it never wanted to take to begin with. And thanks to its excellent financial performance -- in the last year it generated $4.3 billion in revenues and $795 million in profit -- it never needed the money to begin with but Hank Paulson forced Northern to take it.

I thought I had heard it all after banks that took TARP billions paid themselves $18 billion in bonuses after sinking the global financial system. But every time I think banks can't do more to shock me, they go and top themselves. That's what happened with Northern Trust (NASDAQ: NTRS), which took $1.6 billion in bailout money. To its credit, Northern Trust did not blow it all on bonuses -- instead it spent $6.3 million on a big LA party last week.

Why didn't I get my invitation? After all, I paid part of the tab. And so did you. What did our money go to? Here's a partial list:

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Advanced Micro Devices Inc. (NYSE: AMD) reported dismal Q4 results due to lower demand.
• AMR Corp. (NYSE: AMR) reported a bigger-than-expected Q4 loss, sending shares lower.
• Check Point Software Technologies Ltd. (NASDAQ: CHKP) earnings prospects led to an upgrade.
• eBay Inc. (NASDAQ: EBAY) posted Q4 and full-year results with increased revenue due to a stronger dollar.
• Google Inc. (NASDAQ: GOOG) reported strong Q4 numbers that beat analysts' expectations.
• International Business Machines Corp. (NYSE: IBM) reported better-than-expected Q4 and 2008 earnings.
• Lockheed Martin Corp. (NYSE: LMT) posted strong Q4 results but lowered its 2009 guidance.
• Northern Trust Corp. (NASDAQ: NTRS) shares surged after posting better-than-expected earnings.
• Regions Financial Corp. (NYSE: RF) reported a huge loss due to write-downs and offered a bleak outlook.
• Societe Generale said that it expects to have broken even in the final quarter of 2008.
• Southwest Airlines Co. (NYSE: LUV) posted its second straight quarterly loss due to fuel hedging costs.
• UAL Corp. (NASDAQ: UAUA) reported a huge loss on the erosion in value of oil hedges as prices dropped.
• Usana Health Sciences Inc. (NASDAQ: USNA) posted record Q4 results despite one-time charges.

For more highlights from this week, see Apple, Microsoft, GE, Johnson & Johnson, Harley Davidson and others

State Street (NYSE: STT) is recently trading at $24.30 in pre-open trading, below its close of $36.35. STT reported Q4 EPS of 15 cents on net income of $65 million, compared to net income of $223 million, or 57 cents per share in Q4 2007. STT February option implied volatility is at 88, February is at 84; above its 26-week average of 73, according to Track Data, suggesting larger price movement.

Bank of New York (NYSE: BK) is recently trading at $21.39 in pre-open trading, below its close of $23.36. BK is expected to report Q4 EPS on January 22. BK February option implied volatility of 87 is above its 26-week average of 69, according to Track Data, suggesting larger price movement.

Northern Trust (NASDAQ: NTRS) is recently down $4.58 to $46.50 in pre-open trading. NTRS is expected to report Q4 EPS on January 21. NTRS option implied volatility of 99 is above its 26-week average of 71, according to Track Data, suggesting larger price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

I think it's fair to say that there's much trepidation about the earnings season that picks up steam this week. And for better or worse, numbers from the big financials have begun to roll in. Last week we saw profit sink for JPMorgan Chase (NYSE: JPM) and significant losses from Bank of American Corp. (NYSE: BAC), Citigroup Inc. (NYSE: C), and Deutsche Bank (NYSE: DB).

Analysts surveyed by Thomson Reuters expect Bank of New York Mellon Corp. (NYSE: BK) to be among those financials reporting fourth-quarter earnings growth this week. They anticipate that Bank of New York will post a profit of $0.70 per share, compared to $0.67 per share a year ago and $0.72 in the previous quarter. Revenue is expected come to $3.8 billion, about the same as it was a year ago. Bank of New York has fallen short of earnings estimates in two of the past five quarters, by as much as 11.1%. For the full year, analysts are looking for $2.78 per share (+5.8%) on $14.8 billion (+4.2%). The consensus recommendation of analysts is to buy BK, and the long-term EPS growth rate forecast is 10.7%. Shares are 48.7% lower than a year ago. Other financials expected to report quarterly earnings growth this week include SunTrust Banks Inc. (NYSE: STI) and M&T Bank Corp. (NYSE: MTB).

Wall Street's optimism in last week's preview about the earnings of tech stocks wasn't misplaced, as there were many more positive surprises than negative ones among the stocks we looked at. This week will bring plenty more data for investors in and watchers of the sector to mull over. Apple Inc. (NASDAQ: AAPL), AT&T Inc. (NYSE: T), and Microsoft Corp. (NASDAQ: MSFT), for example, are expected by analysts surveyed by Thomson Financial to post modest earnings gains from a year ago, to $1.11 per share (on $8.1 billion in sales), $0.72 per share (on $31.3 billion in sales), and $0.47 per share (on $14.8 billion in sales) respectively. All three of these companies ended the week closer to their 52-week lows than highs, and analysts on average consider them each a buy.

Here's a look at some of the week's biggest expected earnings gainers and decliners in the sector:

• Baidu.com Inc. (NASDAQ: BIDU): $1.25 per share (+44.0%) on revenues of $134.7 million (+103.2%)
• Broadcom Corp. (NASDAQ: BRCM): $0.44 per share (+38.6%) on revenues of $1.3 billion (+33.8%)
• QLogic Corp. (NASDAQ: QLGC): $0.31 per share (+29.0%) on revenues of $170.0 million (+21.2%)
• FLIR Systems Inc. (NASDAQ: FLIR): $0.32 per share (+28.1%) on revenues of $275.2 million (+44.0%)
• Juniper Networks Inc. (NASDAQ: JNPR): $0.30 per share (+26.7%) on revenues of $927.4 million (+26.2%)
• Waters Corp. (NYSE: WAT): $0.75 per share (+17.3%) on revenues of $391.6 million (+11.1%)
• Flextronics International Ltd. (NASDAQ: FLEX): $0.29 per share (+17.2%) on revenues of $8.7 billion (+57.3%)
• EMC Corp. (NYSE: EMC): $0.19 per share (+10.5%) on revenues of $3.7 billion (+12.9%)

After the implosion of IndyMac Bancorp (NYSE: IMB) and news of the deterioration of Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) last week, there's bound to be a certain level of trepidation as the earnings crunch begins this coming week and many big financial companies report. Here's a look at what Wall Street was expecting (see The week in preview: Expectations as the earnings crunch begins for expectations of other reporting companies.)

Analysts surveyed by Thomson Financial are expecting the following of companies to report lower earnings when compared to the same period of the previous year.

• JPMorgan Chase & Co. (NYSE: JPM): 44 cents EPS (-63.3%) on sales of $16.4 billion (-13.2%)
• Comerica Inc. (NYSE: CMA): 51 cents EPS (-59.2%) on sales of $680.2 million (-7.3%)
• Zions Bancorp. (NYSE: ZION): 75 cents EPS (-47.6%) on sales of $627.3. million (+2.7%)
• Huntington Bancshares Inc. (NYSE: HBAN): 23 cents EPS (-32.4%) on sales of $617.1 million (+50.7%)
• Capital One Financial Corp. (NYSE: COF): $1.31 EPS (-30.7%) on sales of $4.4 billion (+7.8%)
• Wells Fargo & Co. (NYSE: WFC): 50 cents EPS (-25.4%) on sales of $10.7 billion (+7.7%)
• M&T Bank Corp. (NYSE: MTB): $1.50 EPS (-23.1%) on sales of $756.6 million (+1.6%)
• BB&T Corp. (NYSE: BBT): 69 cents EPS (-16.9%) on sales of $1.8 billion (+5.9%)
• U.S. Bancorp (NYSE: USB): 60 cents EPS (-7.7%) on sales of $3.8 billion (+8.3%)
• PNC Financial Services Group Inc. (NYSE: PNC): $1.16 EPS (-7.2%) on sales of $1.9 billion (+8.5%)

Investors who are looking to gain exposure to one of the top performing global markets, may be interested in a new ETF that starts trading today. The Tel-Aviv 25 index is the main Israeli large-cap stock index and has produced triple digit returns over the last four years. While Israel is known to have more publicly traded companies in the U.S. than any other country in the world, the make-up of the local TA 25, is mostly a domestic play on banks, phone companies, supermarket chains and other domestic consumption plays. The Israeli companies that trade in the U.S. are mostly hi-tech firms.

A few months ago Ishares launched an ETF on locally traded Israeli stocks. The Ishares MSCI Israel Index (NYSE: EIS) has done quite well, but there is an inherent flaw in the make-up of the ETF. The index gives Israeli generic drug giant, Teva Pharmaceutical (NASDAQ: TEVA) a colossal 25% weighting, basically leaving investors with a, "Where Teva goes, so goes the ETF" type of investment.

Starting today, the EIS will be joined by another ETF. Northern Trust (NASDAQ: NTRS) is launching the TAV, an ETF based on the TA 25. The ETF will try to follow the TA 25, and rarely will have an individual stock weighted above 10%.

For investors looking for some international exposure, take a look at Israel and research the new ETFs on the market. It's a good way to gain entrance and exposure to a flourishing market.

Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has no position in any stock mentioned, as of 5/27/08

Analysts surveyed by Thomson Financial expect Northern Trust Corp. (NASDAQ: NTRS) and State Street Corp. (NYSE: STT) to report profit gains in the first quarter. Both companies are scheduled to post results on Tuesday.

Northern Trust is expected to earn 95 cents per share, which is up 13% from the same period in 2007 when it earned 84 cents. The company has tended to beat quarterly estimates recently. In the third quarter of 2007, it beat the consensus estimate by 6.7%, and in the fourth quarter it beat it by 4.8%.

Chicago-based Northern Trust provides banking and trust services to the affluent and to financial institutions and corporations. In the past year, its revenues were $5.4 billion and its net income totaled $726 million. Its EPS growth forecast for the year is 9.6%, which is better than the banking industry average and the S&P 500. But the consensus recommendation of analysts is still to hold Northern Trust.

The stock has gained 11.2% in the past year and trades at a P/E of 18.37. Shares closed Friday at $67.22.

The quarter has hardly begun and, with analysts and investors watching nervously, the earnings crunch is about to begin anew. The following 11 big banks are among companies reporting results the week of April 14 to April 18.

These three are expected by analysts surveyed by Thomson Financial to be the the top performers in the first quarter, based on earnings growth from the same period of last year:

• State Street Corp. (NYSE: STT): 39%
• Bank of New York Mellon Corp. (NYSE: BK): 22%
• Northern Trust Corp. (NASDAQ: NTRS): 13%

These also happen to be three of the four forecast top performers from just before fourth quarter of 2007 results were reported back in January.

The record loss from Citigroup Inc. (NYSE: C) has overshadowed the results from other lenders, US Bancorp (NYSE: USB) and State Street Corp. (NYSE: STT), that also reported today. The news there wasn't as bad.

US Bancorp reported that fourth-quarter profit fell 21%, partly due to one-time charges. The company had warned about the effects of the real estate slowdown, but it appeared to sidestep the worst of the problems plaguing other lenders. The company's CEO made it a point to explain that the nation's seventh-largest bank is "well capitalized." U.S. Bancorp's net income fell to $942 million, or 53 cents per share, from $1.19 billion, or 66 cents per share, year over year. Analysts surveyed by Thomson Financial had expected profit of 59 cents per share.

State Street reported Tuesday that fourth-quarter earnings fell 28% after the company took a charge to cover fallout from its subprime investments. Excluding the charge, earnings rose to $540 million, or $1.38 per share, from 86 cents per share last year. Analysts polled by Thomson Financial, whose estimates excluded one-time items, had expected earnings of $1.35 per share. Revenue rose 53% to $2.48 billion from $1.62 billion in the same period last year. Analysts had expected revenue of $2.39 billion.

Among lenders scheduled to report on Wednesday are JP Morgan Chase & Co. (NYSE: JPM), Northern Trust Corp. (NASDAQ: NTRS), and Wells Fargo & Co. (NYSE: WFC).

For more earnings forecasts, see Peter Cohan's Earnings expectations for 10 banks tell a mixed story.

Thomson Financial expects Northern Trust (NASDAQ: NTRS) to earn $0.92 when it announces its fourth quarter earnings on January 16th. That's 19% above the same period in 2006 when it earned $0.77.

Northern Trust is a Chicago-based bank whose business units include: Corporate and Institutional Services (C&IS) and Personal Financial Services (PFS). In the last year, its revenues were $2.6 billion and its net income totaled $773 million. Its stock has risen 22% in the last year, and it trades at a P/E of 21.6.

Northern Trust regularly beats estimates. In the second quarter of 2007, Northern Trust beat forecasts by 4.6%, and in the third quarter it beat by 6.9%. My hunch is that Northern Trust will again beat expectations.

Peter Cohan is president of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in Northern Trust securities.

Ted Allrich is the founder of The Online Investor and author of Comfort Zone Investing: Build Wealth And Sleep Well At Night. In this weekly column, he offers advice to investors who are just getting started.

If you own a bank stock, you know how brutal the stock market can be. Many are down more than 50% as the subprime mortgage mess continues to shock all investors. But some banks are being punished for being a bank, not for mortgages they don't even own.

Not all banks are the same. Most banks make mortgage loans to several different kinds of buyers for different types of properties: existing homes, new construction, and/or commercial buildings. Or they only make loans to well-qualified buyers, ones with good income and high FICO scores (your credit score). Still others make no mortgages at all, have a diversified revenue stream and are only guilty of being called banks. Finally, there are banks that have a large percentage of their revenues from international lending. Smart investors will look for all of these types and start investing a small amount in several of them, then wait for the rally that will inevitably come.

This morning, The Bank of New York Company (NYSE: BK) announced the $16.8 billion stock acquisition of Mellon Financial Corporation (NYSE: MEL). Combined, the companies will have about $12.5 billion of annual revenue, rank first worldwide with more than $16 trillion of assets under custody, and rank in the top 10 with more than $1.1 trillion of assets under management.

The BK/MEL deal makes sense because securities processing -- managing the paperwork and information flows between buyers and sellers of stocks and bonds and all the parties in between -- is a scale sensitive business. In other words, the bigger you are, the lower are your costs to process a transaction. And the lower your unit cost, the more leeway you have in price cutting to win lucrative contracts.

The stock market appears to like the deal -- BK is up 8.4% and MEL has risen 5% in pre-market trading. Usually the acquirer's stock drops on such announcements so this is an unusual vote of confidence.

This deal is likely to spur more such deals and State Street Corporation (NYSE: STT) and Northern Trust Corporation (NYSE: NTRS) are two of the most likely merger candidates. STT has $11.3 trillion in assets under custody -- $8 trillion more than NTRS's $3.3 trillion. STT could acquire NTRS since its $20 billion market capitalization is $8 billion more than NTRS's.

Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm, and a Professor of Management at Babson College. He has no financial interest in Bank of New York, Mellon Financial, Northern Trust or State Street.