The price of oil sets a fresh record at $109.20, its fifth day in a row of historic highs as the US dollar has weakened.
Source:
BBC News | Business | World Edition | 11 Mar 2008 | 11:58 am
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Source:
Business and financial news - CNNMoney.com | 11 Mar 2008 | 11:56 am
Stocks looked to rebound at the start of Tuesday's session as bargain-hungry investors hunted for buying opportunities after three straight sessions of declines, even as the price of oil continued to climbed to new highs above $109 a barrel.
Source:
Business and financial news - CNNMoney.com | 11 Mar 2008 | 11:52 am
Read full story for latest details.
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Business and financial news - CNNMoney.com | 11 Mar 2008 | 11:50 am
The price of gasoline matched its record high Tuesday, according to the widely followed survey conducted for the motorist group AAA.
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Business and financial news - CNNMoney.com | 11 Mar 2008 | 11:50 am
LONDON (Reuters) - World number two miner Rio Tinto intends to double uranium production over the next five years as demand for alternatives to fossil fuels grows, a senior company executive said on Tuesday.
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Reuters: Business News | 11 Mar 2008 | 11:45 am
PARIS (Reuters) - French bank Societe Generale said its 5.5 billion euro ($8.45 billion) rights issue was oversubscribed, providing a base for its battle to recover from a trading scandal that has made it a takeover target.
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Reuters: Business News | 11 Mar 2008 | 11:36 am
BRUSSELS (Reuters) - Intel Corp chief executive Paul Otellini arrived at a closed hearing on Tuesday to fight charges the world's largest chipmaker abused its dominance and used illegal rebates to hurt a smaller competitor.
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Reuters: Business News | 11 Mar 2008 | 11:33 am
TOKYO (Reuters) - Citigroup said on Tuesday it would merge its brokerage and investment banking units in Japan, as the faltering U.S. bank looks to bulk up in the world's second-largest economy, despite cutbacks elsewhere.
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Reuters: Business News | 11 Mar 2008 | 11:21 am
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Business and financial news - CNNMoney.com | 11 Mar 2008 | 11:19 am
Societe Generale says it has successfully raised 5.5bn euros by selling cut-price shares to existing investors.
Source:
BBC News | Business | World Edition | 11 Mar 2008 | 11:17 am
Reuters - Citigroup said on Tuesday it would merge
its brokerage and investment banking units in Japan, as the
faltering U.S. bank looks to bulk up in the world's
second-largest economy, despite cutbacks elsewhere.
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Yahoo! News: Business | 11 Mar 2008 | 11:15 am
Sir Richard Greenbury, the former chairman and chief executive of Marks &
Spencer (M&S), has rushed to the defence of the high street retailer’s
decision to promote Sir Stuart Rose to executive chairman in a radical
management shake-up.
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Latest Business News from Times Online | 11 Mar 2008 | 11:13 am
A worsening succession row at the Bank of Japan lurched closer to full-blown
crisis today when the main opposition party confirmed plans to vote down the
government’s choice of Toshiro Muto as the next Governor.
Source:
Latest Business News from Times Online | 11 Mar 2008 | 11:12 am
Read full story for latest details.
Source:
Business and financial news - CNNMoney.com | 11 Mar 2008 | 11:11 am
Crude oil prices surged to a fresh all-time high near $110 a barrel as the International Energy Agency said oil demand would be robust this year boosted by consumption in China and the Middle East.
Source:
FT.com - US homepage | 11 Mar 2008 | 11:10 am
HELSINKI (Reuters) - Shares in the world's top cell phone maker Nokia and several other European technology firms fell on Tuesday after Texas Instruments cut its first-quarter forecasts, citing a weaker 3G market.
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Reuters: Business News | 11 Mar 2008 | 11:05 am
Despite five interest rate cuts in the past six months, Wall Street has remained impervious to the Federal Reserve's wooing, with investors taking a "thanks, but..." attitude to Ben Bernanke & Co.'s attempt to recharge the economy and stock market.
Source:
Business and financial news - CNNMoney.com | 11 Mar 2008 | 11:05 am
Cadbury Schweppes today announced it has secured $3.8 billion in financing to
finally demerge its confectionary and US drinks arms, nearly a year to the
day after the company first revealed plans to split the two groups.$
Source:
Latest Business News from Times Online | 11 Mar 2008 | 10:54 am
Reuters - Japan's main opposition party rejected
the government's pick to run the central bank of the world's
second-largest economy on Tuesday, despite the nominee's pledge
at parliamentary hearings to act independently in the job.
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Yahoo! News: Business | 11 Mar 2008 | 10:51 am
Japan's Democratic Party decides to reject the nomination of Toshiro Muto as Bank of Japan governor.
Source:
BBC News | Business | World Edition | 11 Mar 2008 | 10:43 am
LONDON (Reuters) - The U.S. economy is going through a rough patch but, thanks to a government fiscal package worth some $150 billion, should start recovering as soon as the second quarter, a senior Treasury official said on Tuesday.
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Reuters: Business News | 11 Mar 2008 | 10:41 am
LONDON (MarketWatch) -- Societe Generale said Tuesday that shareholder demand to participate in its rights issue was close to twice the 5.5 billion euros ($8.5 billion) that had been sought to fix a shortfall from January's rogue trading scandal and recent write-downs.
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MarketWatch.com - Top Stories | 11 Mar 2008 | 10:40 am
TOKYO (Reuters) - Japan's main opposition Democratic Party decided on Tuesday to reject government nominee Toshiro Muto as the next Bank of Japan governor.
Source:
Infocious RSS raw feed - channel BNewsBusiness | 11 Mar 2008 | 10:39 am
Thanks to another dismal quarter and a cratering private equity market, Blackstone traded near its all-time low near $14 a share Monday before closing at $15, still 52% off the IPO price of $31. It would seem like a perfect opportunity to buy the revered private equity firm that has $102 billion in assets under management, diverse business lines, and a great track record even in down markets. Moreover, the stock is currently paying a huge 8% dividend yield to investors hoping to ride out the storm.
Source:
Business and financial news - CNNMoney.com | 11 Mar 2008 | 10:36 am
The French bank that was hit by hit by trading scandal that led to a €4.9bn writedown raised €5.5bn from a deeply discounted right issue that was oversubscribed
Source:
FT.com - US homepage | 11 Mar 2008 | 10:36 am
Shares in Grupo Ferrovial, the owner of airport operator BAA, jump as much as 8.8% after the U.K. aviation regulator allows it to raise the fees it charges passengers for using its Heathrow and Gatwick airports in London.
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MarketWatch.com - Top Stories | 11 Mar 2008 | 10:34 am
The euro resumed its upward march Tuesday, bolstered by a stronger-than-expected reading of German economic sentiment and upbeat remarks on the country's economic outlook by Axel Weber, a top European Central Bank official.
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MarketWatch.com - Top Stories | 11 Mar 2008 | 10:30 am
EADS reported Tuesday that it swung to a fourth-quarter profit, but the European aerospace and defense giant warned of significant challenges ahead and issued a cautious outlook.
Source:
MarketWatch.com - Top Stories | 11 Mar 2008 | 10:29 am
Reuters - Wall Street stock index futures rose
on Tuesday, indicating that U.S. equity markets might be headed
for a turnaround similar to those seen in Asia and Europe.
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Yahoo! News: Business | 11 Mar 2008 | 10:27 am
FRANKFURT (Reuters) - Wall Street stock index futures rose on Tuesday, indicating that U.S. equity markets might be headed for a turnaround similar to those seen in Asia and Europe.
Source:
Reuters: Business News | 11 Mar 2008 | 10:27 am
Among the companies whose shares are expected to see active trade in Tuesday’s session are Aetna, Aristotle, Elbit Systems, Foot Locker, Global Sources, Massbank, MFA Mortgage, TI, and WellPoint.
Source:
MarketWatch.com - Top Stories | 11 Mar 2008 | 10:26 am
Stocks in Europe on Tuesday struggled to snap a three-session losing run, with Nokia slumping on a disappointing outlook from a supplier and EADS down on an uninspiring profit report, though Vodafone Group rallied as brokers said the mobile-phone giant was oversold.
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MarketWatch.com - Top Stories | 11 Mar 2008 | 10:25 am
Slowing economies in leading countries will moderate thirst for oil but high prices are not the result of speculation alone and are here to stay, the International Energy Agency warned on...
Source:
Infocious RSS raw feed - channel BNewsBusiness | 11 Mar 2008 | 10:23 am
Six former bosses of defunct firm ISL, former partners of football body Fifa, face fraud charges in Switzerland.
Source:
BBC News | Business | World Edition | 11 Mar 2008 | 10:22 am
Fellow Americans, choose your revolution. One way or another, we're getting a new health-care system. The old one is obviously broken. The U.S. now has 47 million uninsured, and costs are out of control. The Department of Health and Human Services predicts that if things continue as they are, health spending will almost double by 2017 to $4.3 trillion, or one-fifth of GDP, vs. 16% today.
Source:
Business and financial news - CNNMoney.com | 11 Mar 2008 | 10:15 am
Read full story for latest details.
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Business and financial news - CNNMoney.com | 11 Mar 2008 | 10:14 am
PARIS (Reuters) - European aerospace group EADS defended a controversial contract to provide aerial refueling tankers to the U.S. Air Force on Tuesday after defeated rival Boeing announced an appeal.
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Reuters: Business News | 11 Mar 2008 | 10:01 am
A roundup of the latest corporate earnings reports and what companies are saying about future quarters.
Source:
MarketWatch.com - Top Stories | 11 Mar 2008 | 10:01 am
LONDON (MarketWatch) -- Shares in bond fund Carlyle Capital slumped as much as 28% after a two-session suspension Tuesday as it said the amount of collateral liquidated by lenders may have reached $5.7 billion.
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MarketWatch.com - Top Stories | 11 Mar 2008 | 9:55 am
Adaro Indonesia, the country's second largest coal miner, plans to raise about $500m through an initial public offering later this year, one of the owners said on Tuesday.The listing is one of several...
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Infocious RSS raw feed - channel BNPaperBusiness | 11 Mar 2008 | 9:46 am
Asian stocks gain late.
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MarketWatch.com - Top Stories | 11 Mar 2008 | 9:38 am
Cadbury Schweppes on Tuesday layed out a timetable for its demerger into two separate companies after signing a credit agreement with a consortium of five banks which have agreed to provide 1.9bn of debt...
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Infocious RSS raw feed - channel BNPaperBusiness | 11 Mar 2008 | 9:34 am
EADS, the owner of the Airbus aircraft company, suffered a heavy financial
loss last year, burdened by a weak US dollar and restructuring charges.
Source:
Latest Business News from Times Online | 11 Mar 2008 | 9:32 am
China's consumer prices rose at the fastest pace in nearly 12 years in February as prices for food surged, raising the likelihood of higher interest rates. Consumer prices climbed 8.7% from February 2007, accelerating from a 7.1% growth rate seen in January, the Statistics Bureau said. The figures were the highest for the inflation index since May 1996. Consensus estimates were for a 7.9% increase.
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MarketWatch.com - Top Stories | 11 Mar 2008 | 9:26 am
Socit Gnrale helped Europe's ailing banking sector higher on Tuesday after revealing its 5.5bn rights issue was oversubscibed by 1.8 times as shareholders speculated on the possibility of a takeover.The...
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Infocious RSS raw feed - channel BNPaperBusiness | 11 Mar 2008 | 9:26 am
PARIS (Reuters) - European aerospace group EADS defended its contract to provide aerial refueling tankers to the U.S. Air Force after rival Boeing decided to appeal.
Source:
Infocious RSS raw feed - channel BNewsBusiness | 11 Mar 2008 | 9:25 am
Two suspected car bombs in Lahore killed at least 22 people and wounded dozens, in blasts that came as opposition parties continue to work to form a coalition government
Source:
FT.com - US homepage | 11 Mar 2008 | 9:20 am
Chinese inflation shot to its fastest rate in 11 years in February as food
prices continued to climb due to bad weather.
Source:
Latest Business News from Times Online | 11 Mar 2008 | 9:16 am
The European Central Bank said Tuesday that it would hold a quick tender worth 3.5 billion euros (5.4 billion dollars) to offset a liquidity shortage. It made the...
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Infocious RSS raw feed - channel BNewsBusiness | 11 Mar 2008 | 9:16 am
Asian shares rose for the first session in three, recouping morning losses, aided by hopes of another US rate cut soon. The Tokyo and Hong Kong markets rose over 1 per cent
Source:
FT.com - US homepage | 11 Mar 2008 | 9:16 am
Asian shares rose for the first time in three sessions on Tuesday, aided by hopes that the Federal Reserve might cut US interest rates again soon. Markets rebounded after falling in the morning on persisting...
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Infocious RSS raw feed - channel BNPaperBusiness | 11 Mar 2008 | 9:16 am
Asian shares rose for the first time in three sessions on Tuesday, aided by hopes that the Federal Reserve might cut US interest rates again soon. Markets rebounded after falling in the morning on persisting...
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Infocious RSS raw feed - channel BNPaperBusiness | 11 Mar 2008 | 9:16 am
London equities made progress on Tuesday after three-sessions of losses that took the FTSE 100 just 51-points away from its 20-month low. A measure of dealmaking activity helped the blue chip index rise...
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Infocious RSS raw feed - channel BNPaperBusiness | 11 Mar 2008 | 9:08 am
NEW YORK (Reuters) - A shareholder activist group is weighing a campaign aimed at persuading Morgan Stanley investors to withhold their vote for Chief Executive John Mack as chairman of...
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Infocious RSS raw feed - channel BNewsBusiness | 11 Mar 2008 | 9:06 am
French bank Societe Generale, forced into a capital increase by a massive rogue trader scandal, said on Tuesday that demand for the new shares totalled almost twice the amount of stock on...
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Infocious RSS raw feed - channel BNewsBusiness | 11 Mar 2008 | 9:03 am
On a recent warm, rainy day, tree sap trickled through hundreds of taps and down through miles of plastic tubing to Larry Benson's sugar shack. It was official: Maple season has...
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Infocious RSS raw feed - channel BNewsBusiness | 11 Mar 2008 | 9:03 am
AMSTERDAM (Reuters) - Shares in Carlyle Capital Corp Ltd fell almost 15 percent on Tuesday after trading resumed following their suspension last week.
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Infocious RSS raw feed - channel BNewsBusiness | 11 Mar 2008 | 8:59 am
Inflation in China hit a near 12-year high of 8.7 percent in February, the government said Tuesday as it called for a "cool-headed" response to one of the nation's most pressing economic...
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Infocious RSS raw feed - channel BNewsBusiness | 11 Mar 2008 | 8:58 am
Friends Provident chairman Sir Adrian Montague today called on potential
suitor JC Flowers to end uncertainty about its takeover intentions as the
group plunged into loss and announced its finance director would leave his
summer.
Source:
Latest Business News from Times Online | 11 Mar 2008 | 8:47 am
EADS fell into net loss last year under the impact of rising losses at Airbus, but forecast a sharp recovery this year.The leading European aerospace and defence group on Tuesday said it expected operating...
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Infocious RSS raw feed - channel BNPaperBusiness | 11 Mar 2008 | 8:47 am
Incitec Pivot, the Australian fertiliser group, has made a recommended cash and shares offer for Dyno Nobel that values the Australian-listed explosives group at A$3.3bn , including debt.Incitec, which...
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Infocious RSS raw feed - channel BNPaperBusiness | 11 Mar 2008 | 8:36 am
Friends Provident on Tuesday called on JC Flowers to clarify its intentions as its profits fell by more than expected.Sir Adrian Montague, the life assurer's chairman, said the US private equity group...
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Infocious RSS raw feed - channel BNPaperBusiness | 11 Mar 2008 | 8:27 am
An investment vehicle controlled by Vincent Tchenguiz has made an unsolicited offer worth A$1.22bn for Australia's Challenger Infrastructure Fund (CIF) in a move that could spark a battle between the UK-based...
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Infocious RSS raw feed - channel BNPaperBusiness | 11 Mar 2008 | 8:24 am
SAN FRANCISCO (Reuters) - The U.S. economy will shrink in the second quarter, but avoid a recession this year as housing's drag will ease in the second half, helping normal growth return next year, according to a UCLA Anderson Forecast report released on Tuesday.
Source:
Reuters: Business News | 11 Mar 2008 | 8:19 am
Reuters - The U.S. economy is going through a
rough patch but, thanks to a government fiscal package worth
some $150 billion, should start recovering as soon as the
second quarter, a senior Treasury official said on Tuesday.
Source:
Yahoo! News: Business | 11 Mar 2008 | 8:18 am
The UK’s biggest airline has reacted with fury to a new price regime that will
drive up fares at Britain’s two busiest airports.
Source:
Latest Business News from Times Online | 11 Mar 2008 | 8:17 am
Reuters - The U.S. economy will shrink in
the second quarter, but avoid a recession this year as
housing's drag will ease in the second half, helping normal
growth return next year, according to a UCLA Anderson Forecast
report released on Tuesday.
Source:
Yahoo! News: Business | 11 Mar 2008 | 8:16 am
SAN FRANCISCO (Reuters) - The U.S. economy will shrink in the second quarter, but avoid a recession this year as housing's drag will ease in the second half, helping normal growth...
Source:
Infocious RSS raw feed - channel BNewsBusiness | 11 Mar 2008 | 8:16 am
Aerospace and defence group EADS reports bigger than expected losses, but predicts a recovery this year.
Source:
BBC News | Business | World Edition | 11 Mar 2008 | 8:05 am
Cadbury Schweppes said today that the long-awaited demerger of its US drinks business should happen in May, more than a year after it first announced plans to separate the two businesses.
Source:
Telegraph Business | 11 Mar 2008 | 8:05 am
Bakery chain, Greggs says it will "work hard" to maintain profits due to higher energy and ingredients costs.
Source:
BBC News | Business | World Edition | 11 Mar 2008 | 7:48 am
Boeing says it will formally protest against the awarding of a major tanker aircraft contract to its rival EADS.
Source:
BBC News | Business | World Edition | 11 Mar 2008 | 7:29 am
Insurance company Friends Provident unveils a £46m annual loss, hit by a one-off £440m accounting charge.
Source:
BBC News | Business | World Edition | 11 Mar 2008 | 7:27 am
Its stock falls as rival firms quit, but it says its product is superior.
MannKind Corp. pledged Monday to continue developing its insulin inhaler system even though its stock fell after Eli Lilly & Co. said last week that it had given up on a similar diabetes treatment.
Source:
L.A. Times - Business | 11 Mar 2008 | 7:00 am
Wall Street pulls back as oil soars and investors sift through shaky corporate news. The Dow Jones industrial average slides 1.3%.
Wall Street slumped again Monday as worries intensified that the credit crunch soon could lead to the failure of a major financial company.
Source:
L.A. Times - Business | 11 Mar 2008 | 7:00 am
Gasoline prices at the pump also rise to records as crude for April delivery hits $107.90 a barrel.
Crude oil jumped to a new high above $108 a barrel Monday, dragging retail gasoline and diesel prices along for record rides of their own despite ample fuel supplies.
Source:
L.A. Times - Business | 11 Mar 2008 | 7:00 am
The online video service will debut to the public Wednesday with 250 TV series available for free.
Hulu, the closely watched joint venture of News Corp. and NBC Universal, makes its public debut Wednesday, making available legally and for free one of the most expansive collections of television shows on the Internet.
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L.A. Times - Business | 11 Mar 2008 | 7:00 am
Investors were stuck with the shares after the market froze up.
Eaton Vance Corp., the second-largest U.S. manager of closed-end funds, borrowed $1.6 billion to buy back auction-rate preferred stock from investors who were stuck with the securities after the market for them froze up in January.
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L.A. Times - Business | 11 Mar 2008 | 7:00 am
Energy production deal widens the firm's Mideast involvement.
Occidental Petroleum Corp. has agreed to jointly fund energy production and refining projects with Abu Dhabi's International Petroleum Investment Co., the Westwood-based company said Monday.
Source:
L.A. Times - Business | 11 Mar 2008 | 7:00 am
'Serious flaws' in the competition are cited by the company.
Escalating the fight over the biggest defense contract in years, Boeing Co. said Monday that it intended to challenge the Pentagon's decision to place an aircraft order potentially worth $40 billion with the consortium of Northrop Grumman Corp. and European aircraft maker Airbus.
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L.A. Times - Business | 11 Mar 2008 | 7:00 am
Testimony by Liberty Media's John Malone shows how his business relationship with Barry Diller has soured.
Chief Executive Barry Diller ran IAC/InterActiveCorp as if he owned it and proposed a spinoff of key businesses to gain leverage in a potential asset swap, Liberty Media Corp. Chairman John Malone told a Delaware court Monday.
Source:
L.A. Times - Business | 11 Mar 2008 | 7:00 am
Shoppers feel the effects of a weak dollar and higher bean costs.
Lisa Spruill is fighting inflation with a secret stash of coffee. The Los Angeles office building manager has six cans of Don Francisco coffee squirreled away, all purchased with double coupons at local supermarkets in recent months.
Source:
L.A. Times - Business | 11 Mar 2008 | 7:00 am
In a contrarian view, the Anderson Forecast focuses on strength in industry and spending.
Brushing aside conventional wisdom, UCLA economists say California and the nation will survive the housing slump and job losses without plunging into recession -- although it will still be miserable for many Americans.
Source:
L.A. Times - Business | 11 Mar 2008 | 7:00 am
UK retailers saw consumers cut their spending "in earnest" in February, the British Retail Consortium says.
Source:
BBC News | Business | World Edition | 11 Mar 2008 | 6:26 am
The New Zealand dollar took another sharp tumble today amid signs of deterioration in credit markets, weakening global shares and the unwinding of carry trades.
US stocks fell for a third day, depressed by fears of more credit...
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New Zealand Herald - Business | 11 Mar 2008 | 5:52 am
High food prices drove Chinese consumer inflation to an 11-year high of 8.7% in February, figures show.
Source:
BBC News | Business | World Edition | 11 Mar 2008 | 4:40 am
Reuters - U.S. employers are less optimistic
about hiring in the next three months than they were in the
first quarter or a year ago, but the slowdown is gradual and
international labor markets are now less synchronized with the
United States, Manpower Inc . said on Tuesday.
Source:
Yahoo! News: Business | 11 Mar 2008 | 4:30 am
NEW YORK (Reuters) - U.S. employers are less optimistic about hiring in the next three months than they were in the first quarter or a year ago, but the slowdown is gradual and international labor markets are now less synchronized with the United States, Manpower Inc . said on Tuesday.
Source:
Reuters: Business News | 11 Mar 2008 | 4:30 am
Boeing will formally contest the US air force's decision to award a $35bn refuelling tanker contract to a partnership between EADS and Northrop Grumman
Source:
FT.com - US homepage | 11 Mar 2008 | 2:47 am
The BNZ has today lifted fixed-term mortgage interest rates.
The bank increased its two year standard fixed mortgage rate to 9.69 per cent.
The increased rates had come as a response to an increased cost in funding, a bank spokesperson...
Source:
New Zealand Herald - Business | 11 Mar 2008 | 2:45 am
Treasury has become more pessimistic about the economic outlook for householders, predicting that a slowing housing market will have many people feeling the pinch.
Last week, the Reserve Bank foreshadowed a gloomy time for households,...
Source:
New Zealand Herald - Business | 11 Mar 2008 | 2:30 am
Eliot Spitzer, the crusading New York governor and scourge of Wall Street, is under intense pressure to resign after reports linked him to prostitution and he admitted wrongdoing that violated the trust of his family and the public
Source:
FT.com - US homepage | 11 Mar 2008 | 1:57 am
Jean-Claude Trichet has sounded the alarm over the relentless rise of the euro – signalling policymakers' heightened concern about the economic damage threatened by the currency's recent surge
Source:
FT.com - US homepage | 11 Mar 2008 | 1:56 am
Global losses from the sub-prime mortgage credit crunch could rise to US$1 trillion and the turmoil on credit markets could last as long as June next year, says a leading banker.
However, we in Australasia will escape most of the...
Source:
New Zealand Herald - Business | 11 Mar 2008 | 1:15 am
TEXAS INSTRUMENTS (TXN), a leading maker of chips used in cell phones, cut its Q1 EPS outlook to 41-45 cents vs. views of 46 cents. It expects...
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Investor's Business Daily: BUSINESS | 11 Mar 2008 | 12:46 am
Drugs found in drinking water
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Investor's Business Daily: BUSINESS | 11 Mar 2008 | 12:46 am
The old incandescent light bulbs are slowly being outlawed. But not everyone is crazy about going fluorescent. Fortunately, it's not the only...
Source:
Investor's Business Daily: BUSINESS | 11 Mar 2008 | 12:46 am
Chevron (CVX), the second-largest U.S. oil company, said it will soon begin construction of a $3.1 bil natural gas project in the Gulf of...
Source:
Investor's Business Daily: BUSINESS | 11 Mar 2008 | 12:46 am
Murdoch won't battle for Yahoo
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Investor's Business Daily: BUSINESS | 11 Mar 2008 | 12:46 am
China's Bank of Communications may follow other large Chinese financial institutions by buying a stake in a western lender.
Source:
Telegraph Business | 11 Mar 2008 | 12:01 am
The Dublin government appears to be almost powerless to prevent a severe downturn. Ambrose Evans-Pritchard reports.
Source:
Telegraph Business | 11 Mar 2008 | 12:01 am
Sam Laidlaw, chief executive of British Gas owner Centrica, has hit back at government plans to impose controls on pre-payment tariffs for gas and electricity.
Source:
Telegraph Business | 11 Mar 2008 | 12:01 am
Mothers could be offered a financial incentive to start up their own business after having children, in a Government attempt to boost the number of women entrepreneurs.
Source:
Telegraph Business | 11 Mar 2008 | 12:01 am
Northern Rock is withdrawing from the sub-prime mortgage business, bringing to an end a partnership with US investment bank Lehman Brothers.
Source:
Telegraph Business | 11 Mar 2008 | 12:01 am
Japanese restaurant chain Yo! Sushi has been sold to private equity firm Quilvest.
Source:
Telegraph Business | 11 Mar 2008 | 12:01 am
Alistair Darling is to curb energy companies' profiteering from the poor and elderly through pre-payment meters.
Source:
Telegraph Business | 11 Mar 2008 | 12:01 am
Alistair Darling is poised to postpone a 2p rise in fuel duty in tomorrow's Budget following a backlash from motorists.
Source:
Telegraph Business | 11 Mar 2008 | 12:01 am
The housing market is in a worse position than at any time since 1990 - the start of the last housing crash, according to a survey of estate agents and surveyors.
Source:
Telegraph Business | 11 Mar 2008 | 12:01 am
Sir Stuart Rose held a gun to the head of the Marks & Spencer board, and
won. The awkward choice facing his fellow directors was, either accept a
super-powerful Rose or no Rose at all. M&S chairman Lord Burns judged
that a rose by any other name would not smell as sweet, and capitulated.
Source:
Latest Business News from Times Online | 11 Mar 2008 | 12:00 am
With the US economy now clearly in recession, the latest - and potentially
most dangerous - phase of the global financial crisis is under way.
Source:
Latest Business News from Times Online | 11 Mar 2008 | 12:00 am
The housing market experienced its most severe downturn since the housing
slump of the 1990s last month, the Royal Institution of Chartered Surveyors
(RICS) will say today.
Source:
Latest Business News from Times Online | 11 Mar 2008 | 12:00 am
Hillary Clinton's campaign said that Barack Obama's alleged failure to "pass the commander-in-chief test" could rule him out as Mrs Clinton's possible vice-presidential running mate for the general election
Source:
FT.com - US homepage | 10 Mar 2008 | 11:51 pm
The sharemarket eased in early trading after another rough session on Wall Street on simmering fears the US economy is sliding into a recession.
US stocks sank today as crude oil prices struck fresh highs above US$108 ($138) a...
Source:
New Zealand Herald - Business | 10 Mar 2008 | 11:00 pm
The Commerce Commission is recommending prices for mobile roaming not be regulated.
Roaming allows subscribers of one mobile network to use their mobile telephone handset on a different mobile network to make and receive calls.
As...
Source:
New Zealand Herald - Business | 10 Mar 2008 | 11:00 pm
An employers' group is irate about what it claims are anomalies and complexities in the law governing KiwiSaver, causing red tape headaches for bosses.
"A fourth round of changes to the KiwiSaver law is needed as more errors keep...
Source:
New Zealand Herald - Business | 10 Mar 2008 | 10:45 pm
Fonterra is telling its farmers it is taking another look at some discarded capital structure options.
Fonterra chairman Henry van der Heyden confirmed that the preferred listing plan option had been put to one side and the discarded...
Source:
New Zealand Herald - Business | 10 Mar 2008 | 10:30 pm
Reaching a hundred dollars a barrel was wild enough. Now, it's just getting ridiculous.
Oil shot to a record over US$108 a barrel overnight (NZ time), extending a rally led by investors seeking a hedge against the tumbling dollar...
Source:
New Zealand Herald - Business | 10 Mar 2008 | 10:10 pm
Every organisation has a few people who always seem to challenge the way things are done. Those at the top want the company to zig while these people say it should zag.
Those contrarians can be annoying. They may complain about...
Source:
New Zealand Herald - Business | 10 Mar 2008 | 10:00 pm
Money sent home by Latin American migrant workers in the US grew last year at their slowest rate in a decade, a result of the US economic slowdown and the crackdown against illegal migration, combined with the strength of the Brazilian economy
Source:
FT.com - US homepage | 10 Mar 2008 | 9:14 pm
Ambition might be Dubai's most obvious attribute, but there is a deep environmental cost of its building frenzy. There aren't enough natural resources to back it up. Sam Eaton reports.
Source:
Marketplace | 10 Mar 2008 | 8:38 pm
Six Flags, Busch Gardens and Sea World are planning to build amusement parks in Dubai. If all that reminds you of a certain American city also built in the desert, well, join the club, says commentator and Arab media producer Jamal Dajani.
Source:
Marketplace | 10 Mar 2008 | 8:37 pm
There's a women's only, ex-pat book club that gets together in Dubai the first Wednesday of every month. Its members are from Turkey, Yemen, Spain, Venezuela and Afghanistan. They say they'd like to get to know more locals. But that, and other things in Dubai, are hard.
Source:
Marketplace | 10 Mar 2008 | 8:31 pm
Commodity exchange-traded funds jump on record crude price.
Source:
SmartMoney.com | 10 Mar 2008 | 8:28 pm
Third-party service fees are popping up on cellphone bills. Here's how to dodge them.
Source:
SmartMoney.com | 10 Mar 2008 | 8:12 pm
Somewhere, Dick Grasso is smiling. Somewhere, Henry Blodget is kicking up his heels. And somewhere, Ken Langone's meatball hero is a little tastier.
But if anyone on Wall Street is gloating following the bombshell news that Governor Eliot Spitzer of New York, the onetime Sheriff of Wall Street, has been implicated in a prostitution scandal, they're doing so in private.
A handful of Spitzer's former adversaries declined to comment on the stunning turn of events,
first reported on the
New York Times website, or they did not return requests for comment.
"It would be totally inappropriate for me to comment," former New York Stock Exchange C.E.O. Grasso told Portfolio.com. Spitzer sued in 2004 to have Grasso return the bulk of his nearly $140 million pay package.
Former American International Group chairman and C.E.O. Hank Greenberg, who was forced to resign under pressure from Spitzer, was similarly tight-lipped.
"Mr. Greenberg will not be saying anything about this," his spokesperson said.
Former Wall Street analyst Blodget, whom Spitzer targeted for sending private emails that conflicted with his public stock analysis, did not return requests for comment.
Meanwhile, the news dominated Wall Street chatter on Monday, prompting near-glee from financial-industry sources, who have long resented Spitzer's sometimes heavy-handed pursuit of Wall Street figures.
"Wall Street is beside itself in an orgy of schadenfreude," said Barry Ritholtz, C.E.O. of Wall Street research company FuisonIQ. "There are a lot of high fives on the Street today."
CNBC's Jim Cramer, an old friend of Spitzer's, said he hoped the allegations against the governor were not true.
"Someone earlier said there were rumblings. There's no rumblings about this," Cramer said on CNBC. "Eliot's my friend. So he's my friend, he'll be my friend after. You know, I just hope it's not true. If it's true, it's obviously very sad. It's bad."
In a televised press conference, Spitzer did not refer to a report in the Times article linking him to a call-girl scandal. Citing "a person briefed on the federal investigation," the Times said that federal agents investigating a high-priced prostitution ring had intercepted phone calls in which the governor arranged a liaison at a Washington hotel in February.
Instead, Spitzer told reporters gathered at a press conference in New York City that he wanted to "briefly address a private matter" without being more specific.
"I have acted in a way that violated the obligations to my family and that violates my—or any—sense of right and wrong," said Spitzer, who is married and has three children. "I apologize first, and most importantly, to my family. I apologize to the public, whom I promised better," he said.
"I do not believe that politics in the long run is about individuals," he added. "It is about ideas, the public good, and doing what is best for the state of New York. But I have disappointed and failed to live up to the standard that I expect of myself. I must now dedicate some time to regain the trust of my family."
He concluded by saying, "I will not be taking questions. Thank you very much. I will report back to you in short order. Thank you very much."
Spitzer didn't offer his resignation or even talk about leaving office. Instead, he said, "We vowed to bring real change to New York, and that will continue."
The Times article linked Spitzer to the arrest last week of the operators of a business called Emperors Club V.I.P. That firm charged $1,000 an hour for what it described as a "three-diamond" prostitute and $3,100 an hour for a "seven-diamond" call girl.
The website offered clients membership in the Emperors Club's Icon Club, a status that allowed the clients to access restricted areas of the website and permitted them to schedule appointments for illegal prostitution services with the highest-ranked prostitutes, whose fees started at $5,500 an hour.
During his eight years as New York State's attorney general, a job that allowed him to pursue civil and criminal prosecutions against corporate officers, Spitzer took on some of the most powerful people on Wall Street.
His targets included Grasso, who was then chairman of the N.Y.S.E., and Langone, who was Grasso's biggest supporter on the N.Y.S.E. board. Spitzer also pressured A.I.G. to force out Greenberg, its longtime chairman, and exposed Blodget for hyping stocks to help investment bankers sell their services to clients.
Spitzer was easily elected governor in 2006, running largely on his record as a Wall Street reformer.
If Spitzer steps down, Lieutenant Governor David Paterson would succeed him. Paterson, who is legally blind, would be New York's first black governor.
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John Malone's claws came out first in the courtroom catfight of the moguls that got underway Monday at the Delaware Chancery Court.
Malone, chairman of Liberty Media, got a few digs in about Barry Diller's prowess as a chief executive at IAC/InterActive Corp., observing that IAC's stock price has been "extremely volatile" since the company "went into Internet space."
He added, archly, that IAC stock has been "a very poor performer" compared to stock indexes, a phenomenon he called the "Barry discount" in a Wall Street Journal story last October.
Diller, meanwhile, has been "extremely well compensated," and "developed some pretty aggressive approaches to personal use of corporate aircraft. Mr. Diller made it a fine art."
Corporate jets figure prominently in this slugfest: The two ran into each other at the Teterboro, New Jersey, airport on Jan. 16, just after a tense IAC board meeting that Malone—called Dr. Malone at this trial—spelled the end of their 13-year partnership.
At the airport, Malone told Diller, "I know you want to run your own show," and suggested negotiating an amicable divorce. To which Diller responded, "Amen," according to Malone's testimony today.
The parting, alas, has been anything but amicable.
Diller and Malone are fighting over control of IAC, a $5 billion company that Diller built with Malone's backing. The company includes Ask.com, Ticketmaster, and the HSN home-shopping network.
Diller wants to divide the company into five pieces, all of which would no longer carry a dual-class stock structure. Malone's Liberty Media, which owns 30 percent of IAC's equity but nearly 62 percent of its voting stock, opposes the deal.
But Malone gave Diller a proxy to vote Liberty's shares as he saw fit. Or did he?
That's the question before Vice Chancellor Stephen Lamb of the Chancery Court in Wilmington, Delaware.
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On the stand, Malone explained that he and Diller had gotten to know one another "over the years," when Diller was with the Fox network and later when Diller took a job at the QVC network, "and found himself with some spare time." (That would have been when he was fired.) The two bonded over an interest in boating, and their first business relationship began with Silver King Broadcasting.
"We would arrange for him to have our votes," Malone said of granting the voting proxy for Liberty's shares. "I didn't get too much into the legalistic details." He added: "Of course the unstated unwritten positive" in the covenants between them, was that Diller would "be a good steward of our votes."
The fight over Diller's plan to create five spinoffs came to a head at a meeting of the IAC board on January 16, 2008, when Diller and lawyers from Wachtell Lipton Rosen & Katz made a presentation. Malone pressed the Wachtell Lipton lawyers about whose interests they were representing—Diller personally or the interests of the company.
Martin Lipton, Wachtell's lead lawyer, assured the directors they would have "no personal liability" under Delaware corporate law if they voted in favor of the spinoffs. And as to a shareholder vote, Diller said there would be a vote on the spinoffs and he would vote for it. "It was like a cutoff, if you want to call it that, of the discussion."
Malone, not exactly a fount of charisma or emotion on the witness stand, did wax eloquently at the end of his direct testimony: "My opinion is that it's a breach of the stewardship we granted him at the beginning of this relationship," he pronounced. "I'm not a lawyer. To me, it's a breach of faith."
In a court of law, however, those little legal details do matter, as Wachtell's Marc Wolinsky made clear on cross examination. After all, Malone employed "fine" legal counsel to dot all the i's and cross all the t's.
"They would have put down in clear English a checklist of things that Mr. Diller could and couldn't do?" Wolinksy asked.
He then reminded Malone of a colorful description of lawyers he made at his deposition in the case. "You never met a one-handed lawyer; it's always on the other hand, right?"
Wolinsky took Malone through a series of deals made during the 13-year relationship between Diller and Malone, making it clear that Malone was not aware of the legalities of how the proxy would work over time.
In fact, once Gregory Maffei of Microsoft took over as Liberty's chief financial officer in 2005, Maffei—who was no fan of Barry Diller—asked Liberty's legal counsel to draft a memo on the question of Diller's voting rights.
Before leaving the witness stand, Malone seemed a bit contrite. "I still hold him no ill will," he said. "And I still seek a win-win solution. In a sense, that we were unable to resolve this without going to court, I think we both hurt ourselves."
William Berkman, who became a Liberty representative on IAC's board in 2006, said the spin-offs combined with the single tier stock structure—reducing Liberty's voting interest from about 60 percent to 9 percent—described the impact as fundamentally unfair. "Our relationship is based on trust. I fundamentally don't think it's fair," he said.
He described the showdown between Diller and Malone at the January 16 board meeting as a "a classic sort of challenge situation."
While he could not remember Diller's exact words, Berkman said "there was no doubt in my mind," that Diller planned to use the irrevocable proxy to vote in favor of the spin-offs.
"It was final," Berkman testified. He was not shaken from this view on cross examination: "I've thought about it a lot because it's so important."
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It was only a few months ago when $100 a barrel for oil seemed to be a height just beyond the market's grasp. Now, get ready for $110, $120, or, just possibly, according to analysts at Goldman Sachs, $200 a barrel oil.
Today, oil jumped 2 percent, to $107.44 a barrel, in morning trading on the New York Mercantile Exchange. he national average price of a gallon of gas rose 0.7 cent overnight to $3.222 a gallon, 69 cents higher than one year ago, according to AAA and the Oil Price Information Service. Last May, prices peaked at $3.227 as surging demand and a string of refinery outages raised concerns about supplies.
Last week, when oil touched $104 for the first time, Rex Tillerson, the chief executive of Exxon Mobil, said the recent surge was "pretty crazy," according to Dow Jones. He attributed a third of the run-up to the weak dollar, a third to geopolitical uncertainty, and the rest to market speculation
Many investors, seeking alternatives to slumping stock markets and frozen credit markets, have been shifting money into commodities, especially oil.
"The disconnect between slowing U.S. growth and a soaring commodity/energy complex has truly been quite remarkable," Edward Meir of MF Global
told Reuters.
Daniel Yergin of Cambridge Energy Research Associates and others have noted how the U.S. economy is less dependent on energy than it was at the time of the oil shocks of the 1970's For high oil to play a similar role in a sharp economic slowdown, he
says, prices would have to average $100 to $120 a barrel for six months to a year.
But we are gradually getting closer to that range.
In a report on Friday, the energy research team at Goldman Sachs, who had surprised investors three years ago by forecasting the possibility of oil as high as $105 a barrel, raised their targets.
They now see oil averaging $95 a barrel this year and $105 next year. They add that a strong recovery in the U.S. economy or a significant disruption to supply "could lead to $150 to $200 a barrel oil prices."
The White House announced today that Vice President Cheney will leave next week for a trip to Saudi Arabia, as well as to Oman, Israel, and Turkey. Oil prices will be high on his agenda.
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Portfolio.com: Top 5 | 10 Mar 2008 | 4:00 pm
Profit down 89 percent. Revenue down 73 percent. Share price down 55 percent from last year's initial public offering.
Welcome to
Steve Schwarzman's reality.
The Blackstone Group, the buyout giant run by Schwarzman, reported fourth-quarter profit of $88 million, or 8 cents per share, on revenue of $345 million. A year earlier, the firm booked earnings of $808 million, or 72 cents per share, on $1.3 billion in revenue.
And that's the good news. If you include the compensation costs related to last year's I.P.O., Blackstone lost $107 million during the period. Wall Street analysts predicted it would earn 19 cents per share.
The market has not been kind to Blackstone, which went public at $31 per share last June and now trades for about $14. The ill-timed offering occurred at the cusp of the credit crisis, which is showing no signs of relenting.
Schwarzman
acknowledged the "significant challenges" the firm faced in the second half of the year: declining equity and bond markets, leading to lower carried interest and fee revenues; lack of available financing for leveraged buyouts; little visibility and difficult market conditions in the U.S. and Europe.
But still, as any C.E.O. must do in troubled times, Schwarzman tried to add a dose of optimism to the otherwise dreary report. He noted that Blackstone has made eight new private equity commitments worth $2.7 billion since the credit crisis began, and it continues to see opportunities, especially in Asia.
Blackstone closed its $930 million acquisition of the hedge fund GSO Capital Partners last week. Adding the $10 billion fund, which focuses on distressed debt and leveraged loans, is Blackstone's attempt to diversify more from the private equity market, which has slowed down considerably as financing has become increasingly difficult.
Shares of Blackstone are down nearly three percent today, reaching new lows. On
Private Equity Hub, Dan Primack advises against buying shares even at these temptingly low levels.
Blackstone is still too risky because the market doesn't understand how to value it, he says. Blackstone's agreements to buy companies—as Schwarzman said it has done eight times in recent months—should not hold much weight in deciding to buy the stock at any given time.
Moreover, Primack adds, its position as a public company makes it vulnerable to shareholder pressure on when the firm should sell its portfolio companies.
On Portfolio.com's
Market Movers blog, Felix Salmon reminds us that the real loser so far is the Chinese government, which took a $3 billion equity stake in Blackstone prior to its I.P.O. At the time, the sovereign wealth fund said it made the investment specifically to boost its overseas returns. But that deal, so far anyway, has turned out to be a dud.
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Bank of America's deal for
Countrywide Financial is looking more expensive every day.
Shares of Countrywide are down nearly 6 percent today, after the
Wall Street Journal reported on Saturday that the Federal Bureau of Investigation is looking into whether Countrywide officials made fraudulent misrepresentations about the company's health and the quality of its mortgage loans.
On January 11, Bank of America announced an agreement to acquire Countrywide for $7.16 per share in stock, offering no premium. (Countrywide shares closed the day before, amid reports of an imminent deal, at $7.75.) Now, as Countrywide's stock slumps, that deal is offering Countrywide shareholders a 42 percent premium.
Some Countrywide investors, including Bill Miller of Legg Mason, have said that Bank of America is underpaying for Countrywide, noting that the offer was roughly a third of Countrywide's book value. Others have criticized the deal, saying that Bank of America is taking on too much risk as the housing slump deepens.
Will the potential added liability of regulatory, and now criminal, investigations tip the scale and prompt Bank of America to walk away? Or as Tom Bems of MarketWatch
puts it: "Getting the F.B.I. to do your due diligence doesn't seem like a particularly great business strategy."
The mechanics of any potential breakup would center on the provision in the
contract known as the MAC clause—the material adverse effect or event clause. Buyout firms have invoked this clause in trying to walk away from or renegotiate the price.
Steven Davidoff, in the Deal Professor column on the
New York Times' DealBook blog,
says that a mere investigation is typically not enough to be a MAC event. He says it could become one, but "the investigation would have to be something that was not disclosed on the disclosure schedules to the merger agreement that qualify this representation. It would also have to have had or would reasonably be expected to have a MAC on Countrywide."
A Bank of America spokesman
told Bloomberg News today that the acquisition of Countrywide remains on track.
The investigation of Countrywide is not a complete surprise. In January, the F.B.I. announced that it had opened investigations into 14 companies as part of a wider inquiry into the subprime mortgage market.
The agency did not identify the companies, but said that the inquiries were centering on valuation issues. As the largest mortgage lender in the nation, Countrywide was certain to be included in that inquiry.
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China's trade surplus narrowed 63 percent in February, to $8.7 billion, as exports rose 6.5 percent—the slowest pace in six years.
The unexpected decline was attributed largely to the effects of the new year holiday and winter storms that closed some factories and delayed shipping.
"We think the sharp slowdown in China's export growth in February is temporary," Mingchun Sun, an economist with Lehman Brothers, said in a report to clients,
according to the Associated Press.
More troubling is another report that shows that Beijing is struggling to keep inflation under control.
The National Bureau of Statistics
says producer prices for manufactured goods rose 6.6 percent in February from a year ago, while prices for raw materials, fuel, and power rose 9.7 percent from a year ago.
The government has been wrestling with an acceleration in consumer inflation, driven largely by higher food prices as a result of shortages of pork and other foodstuffs.
But the producer price report indicates that the price pressures are being felt throughout the economy, potentially raising the costs of goods sent to the United States.
"Virtually everything is on the rise—not just fuel, but coal and iron ore—all these things are growing much stronger than fuel, plus labor costs are going up too," Jun Ma, chief China economist at Deutsche Bank in Hong Kong,
told Reuters.
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Portfolio.com: Top 5 | 10 Mar 2008 | 12:30 pm
As the financial devastation caused by the mortgage banking crisis rolls through the economy, it's clear that the debacle in fundamental ways is reenacting earlier disasters:
The drive for profits caused the industry to ignore or hide profound dangers, and led regulators to look the other way, while the full consequences weren't anticipated as the crisis began.
In one respect, though, this disaster differs from every other big financial crisis, at least as far back as the 1929 market crash: No one is calling for an independent, blue-ribbon commission to investigate the causes, and to recommend ways to prevent such meltdowns from happening again.
Neither the White House nor Congress has made any move to establish such a commission. Instead, the consensus so far is to leave investigations and solutions to the regulatory agencies, lawmakers, and other political figures—among those who'd stood by even when the potential for disaster had become clear.
But in some circles in the academic and securities world, talk is growing that such a commission may be essential. They say only an independent panel would be able to conduct an aggressive, impartial investigation, provide a comprehensive narrative of what happened, and bring forth evidence of hidden fraud and false disclosure.
Such a panel, of course, could also produce conclusions and recommendations that might threaten the reputations and entrenched interests of federal regulators and the banking industry.
Robert Litan, a senior fellow at the Brookings Institution in Washington, an expert on banking and financial regulation, says he is writing a paper specifically calling for an investigative commission. Such a panel is needed, he argues, because some causes remain unclear, and "the solutions are not obvious and not easy."
Among unresolved questions are why banks themselves didn't recognize the danger they faced, why regulators didn't raise red flags and crack down before it was too late, and whether fundamental changes are needed in accounting rules.
Just two days after the October 1987 market crash, President Ronald Reagan established the Presidential Task Force on Market Mechanisms to figure out what had happened.
Led by Nicholas F. Brady, who was later Treasury secretary under President George H.W. Bush, that body revealed previously unsuspected causes of the crash and suggested specific reforms. It produced fundamental changes in market trading.
Other blue-ribbon panels produced similar or even greater results:
- After the 1929 crash, the Pecora Commission made withering conclusions about bankers and the regulatory system. Its recommendations fundamentally shaped the U.S. banking system and markets for decades.
- After waves of scandals wracked trading in over-the-counter stocks and the American Stock Exchange, the Securities and Exchange Commission in 1961 appointed a commission led by Milton Cohen, a lawyer and securities authority who had been one of the S.E.C.'s first officials when the agency was created. Its report voluminous report caused radical reforms, including for the first time imposing registration and disclosure requirements for O.T.C. companies.
- After the 1980s savings-and-loan crisis, Congress established the National Commission on Financial Institutions Reform, Recovery, and Enforcement. Its report heavily faulted S&L regulatory agencies for having helped cause the crisis, and recommended significant accounting changes.
Other panels, of course, have been formed after nonfinancial crises, including the commission that reviewed the terror attacks of September 11, 2001. They also have been lauded for fact-finding and recommendations that likely wouldn't have been possible otherwise.
Why no move by Congress to establish a panel? A spokesman for Barney Frank, the Massachusetts Democrat and chairman of the House Financial Services Committee, says this time around there's no need for an independent commission.
"We're way beyond it," he said. "We know what's happened."
Frank's spokesman contends the crisis was mainly caused by seven years of a Republican Congress and a Republican president, which opposed heightened regulation of the financial industry.
Frank and fellow Democrats already have responded with the legislation needed to address what they contend are inadequacies in government oversight and laxness by lenders.
President Bush has concentrated on stimulating the economy and bringing relief to homeowners facing foreclosure. Publicly, there hasn't been any talk of establishing a commission. The White House has been notably averse to steps that might lead to more regulation of business—or cast blame on administration appointees.
Elliot Levitas, a former Democratic congressman who also had served on the S&L commission in the 1990s, says "there's going to have to be a respected, independent blue-ribbon commission to sort out what happened" in the mortgage market. Independence is key, he said, because the regulators now trying to clean up the mess had been "asleep a the switch."
"There are people in the private sector who were so blinded and driven by greed that they were doing irresponsible things," Levitas added, "and there was nobody in an official position blowing the whistle and reining them in."
In interviews, figures such as Lynn Turner, former S.E.C. chief economist, and Harvey Goldschmid, former Democratic member of the commission, have endorsed the creation of an independent panel.
But Andrew Brimmer, a former member of the Federal Reserve Board of Governors who was a co-chairman of the S&L commission, suggests one reason the time isn't ripe for a blue-ribbon panel: The mortgage crisis is still having escalating repercussions.
Brimmer says the need is for urgent, immediate steps to halt a potential economic meltdown. A panel to do a postmortem can wait, he argues, until the final tally of damage is known.
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Portfolio.com: Top 5 | 10 Mar 2008 | 11:30 am
Time—and money—appear to be running out for Carlyle Capital Corp., the mortgage-bond fund taken public last summer by private equity titan Carlyle Group.
The fund said today that it had asked its lenders to hold off on liquidating any more of its collateral. The fund, with assistance from Carlyle Group, has stepped up talks with its lenders and is "evaluating all available options to maximize value for all interested parties."
Lenders, declaring that the fund has defaulted, have already sold off $5 billion of Carlyle Capital's securities—about a quarter of the fund's $21 billion portfolio of residential mortgage-backed securities. The fund also says that it has received more than $400 million in margin calls.
Carlyle Capital said: "The company is in ongoing negotiations with the remaining lenders, who hold approximately $16 billion in securities, and, if a mutually beneficial agreement is not reached, some of these lenders may also liquidate their securities."
Shares of the fund, which trade on the exchange in Amsterdam, were suspended on Friday.
Carlyle Capital also said that it had not received any deficiency notices from those lenders who sold collateral to cover the borrowings.
The Financial Times' Alphaville blog finds that curious, because it indicates that the assets being sold had not become toxic, that they had held their par value. "Why then, were margin calls being made in the first case?"
Alphaville answers its own question by referring to an earlier article by James Mackintosh of the Financial Times, who explains that the repo desk of a bank is an unusual creature, offering "credit to buy a multiple of the cash put up by an investor, potentially 30 times or more for high-quality assets."
"But the cash safety margin must be maintained at a fixed percentage, set to protect banks from losses in case they are forced into a fire sale by a default—so the more the price falls, the more cash the investor has to give the bank." the Financial Times says.
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