Archive: 02/28/2008
Main News
ISDA offers suggestions on CDS settlements
Holders of credit default swaps have new guidance on settling trades if one of the troubled U.S. bond insurers were to fail. The International Swaps and Derivatives Association published a list of deliverables bonds. "The purpose of the list is to provide information as to the range of obligations that market participants believe may be delivered in the occurrence of a credit event," the association said. FinancialWeek (26 Feb.)
Holders of credit default swaps have new guidance on settling trades if one of the troubled U.S. bond insurers were to fail. The International Swaps and Derivatives Association published a list of deliverables bonds. "The purpose of the list is to provide information as to the range of obligations that market participants believe may be delivered in the occurrence of a credit event," the association said. FinancialWeek (26 Feb.)
Banks may have an advantage over their brokerage-house rivals in weathering losses on leveraged loans. Thanks to a quirk in accounting rules, banks such as J.P. Morgan don't always have to book losses immediately on those loans even as brokers like Goldman Sachs are forced to take hits right away.
http://online.wsj.com/article/SB120407667879295385.html?mod=djemheard
http://online.wsj.com/article/SB120407667879295385.html?mod=djemheard
How The Slowdown May Affect The Largest U.S. Cities
Slightly more than 80% of the U.S. population lives in urban areas, according to recent Census Bureau estimates. Of those urbanites, nearly 10%--some 24 million--reside in the 10 largest rated U.S. cities. These cities are all confronting the developing economic slowdown and everything that it implies about jobs and tax revenues. All are feeling the effects of the housing slump, which is starting to impinge upon certain revenue streams. And all have to consider and deal with taxpayer resistance to increased levies.
To learn more, click or copy and paste the URL below:
(subscription required)
http://standardandpoors.rsys1.net/servlet/cc5?kHiQABSSQTVsLgHxhilpuHQJhuV2VR
Slightly more than 80% of the U.S. population lives in urban areas, according to recent Census Bureau estimates. Of those urbanites, nearly 10%--some 24 million--reside in the 10 largest rated U.S. cities. These cities are all confronting the developing economic slowdown and everything that it implies about jobs and tax revenues. All are feeling the effects of the housing slump, which is starting to impinge upon certain revenue streams. And all have to consider and deal with taxpayer resistance to increased levies.
To learn more, click or copy and paste the URL below:
(subscription required)
http://standardandpoors.rsys1.net/servlet/cc5?kHiQABSSQTVsLgHxhilpuHQJhuV2VR
418 U.S. ABS Ratings Affected By FGIC, XL Capital, MBIA Rating Actions
We initiated various rating and CreditWatch actions on 418 U.S. asset-backed securities (ABS) from 226 transactions as a result of recent rating and CreditWatch actions on bond insurers Financial Guaranty Insurance Co. (FGIC), XL Capital Assurance Inc. (XLCA), and MBIA Insurance Corp. (MBIA). We lowered our long-term ratings on 64 U.S. ABS classes to 'A' from 'AA', and 29 classes to 'A-' from 'AAA.' In addition, seven U.S. ABS ratings were delinked from the rating on FGIC and 15 from the rating on XLCA. Furthermore, we affirmed our 'AAA' long-term ratings on 303 U.S. ABS transactions with exposure to MBIA.
To learn more, click or copy and paste the URL below:
http://standardandpoors.rsys1.net/servlet/cc5?kHiQABSSQTVsLgHxhilpuHQJhuV2VW
We initiated various rating and CreditWatch actions on 418 U.S. asset-backed securities (ABS) from 226 transactions as a result of recent rating and CreditWatch actions on bond insurers Financial Guaranty Insurance Co. (FGIC), XL Capital Assurance Inc. (XLCA), and MBIA Insurance Corp. (MBIA). We lowered our long-term ratings on 64 U.S. ABS classes to 'A' from 'AA', and 29 classes to 'A-' from 'AAA.' In addition, seven U.S. ABS ratings were delinked from the rating on FGIC and 15 from the rating on XLCA. Furthermore, we affirmed our 'AAA' long-term ratings on 303 U.S. ABS transactions with exposure to MBIA.
To learn more, click or copy and paste the URL below:
http://standardandpoors.rsys1.net/servlet/cc5?kHiQABSSQTVsLgHxhilpuHQJhuV2VW
Methodology & Assumptions: Applying The Derivative Counterparty Framework To Covered Bonds
Standard & Poor's covered bond rating methodology blends its traditional structured finance approach with that of financial institution analysis. Following the publication of our general framework for counterparty and supporting parties in structured finance transactions, we are now applying this framework to all derivatives used in covered bonds that are issued under specific covered bond legislation (so-called "legislation-enabled" covered bonds).
To learn more, click or copy and paste the URL below:
http://standardandpoors.rsys1.net/servlet/cc5?kHiQABSSQTVsLgHxhilpuHQJhuV2VSR
Standard & Poor's covered bond rating methodology blends its traditional structured finance approach with that of financial institution analysis. Following the publication of our general framework for counterparty and supporting parties in structured finance transactions, we are now applying this framework to all derivatives used in covered bonds that are issued under specific covered bond legislation (so-called "legislation-enabled" covered bonds).
To learn more, click or copy and paste the URL below:
http://standardandpoors.rsys1.net/servlet/cc5?kHiQABSSQTVsLgHxhilpuHQJhuV2VSR
Tue, 26 Feb 2008, 19:07
Financial News
BlackRock's chief strategists for equities and fixed-income instruments have reinforced their earlier skeptical view on the financial sector, saying that dislocations in the credit markets and excess leverage from the past several years are still being unwound. In a presentation to a roomful of journalists, BlackRock's chief investment officer of fixed income Scott Amero said that although US banks have written down much of their expected losses in risky derivative products such as collateralized debt obligations and structured investment vehicles, non-US banks in Asia and Europe probably have more to go.
BlackRock's chief strategists for equities and fixed-income instruments have reinforced their earlier skeptical view on the financial sector, saying that dislocations in the credit markets and excess leverage from the past several years are still being unwound. In a presentation to a roomful of journalists, BlackRock's chief investment officer of fixed income Scott Amero said that although US banks have written down much of their expected losses in risky derivative products such as collateralized debt obligations and structured investment vehicles, non-US banks in Asia and Europe probably have more to go.
, by Felix Salmon
Slow Economy, High Prices Raise Specter of Stagflation
(By Neil Irwin and Dina ElBoghdady, The Washington Post)
(By Neil Irwin and Dina ElBoghdady, The Washington Post)
Abandonment. A bond marketer said the current crisis in auction-rate securities "is not the finest hour of the investment-banking community," criticizing bankers for refusing to make a market. Now bankers have turned to recommending debt restructurings, "where they will earn yet another investment-banking fee."
Bond market guru speaks. Pimco's Bill Gross says value is returning to many parts of the bond market. "And if Washington gets off its high “moral hazard†horse and moves to support housing prices, investors will return in a rush."
FDIC prepares for bank failures. The FDIC, established during the Great Depression to protect depositors from bank failures, is preparing for the possibility of a major bankruptcy. "The notion that a bank is too big to fail shouldn't be out there," says FDIC's Jim Marino. In a report released yesterday, it notes that non-current loans exceeded the organization's reserves for the first time in 15 years.
Oil hits new peak as commodities boom
February 27, 2008 05:38 AM ET
LONDON (Reuters) - Oil powered to a new record above $102 a barrel
on Wednesday, closing in on its inflation-adjusted peak, as
a slumping dollar on lacklustre U.S. economic data triggered
a surge across commodities markets.
http://links.reuters.com/r/6IP8X/LLK95/RK9U5/NN4KE/PZ4P9/YT/t
February 27, 2008 05:38 AM ET
LONDON (Reuters) - Oil powered to a new record above $102 a barrel
on Wednesday, closing in on its inflation-adjusted peak, as
a slumping dollar on lacklustre U.S. economic data triggered
a surge across commodities markets.
http://links.reuters.com/r/6IP8X/LLK95/RK9U5/NN4KE/PZ4P9/YT/t
Hedge fund Elliott Accuses Rival of Espionage
Reuters - Wednesday February 27, 11:28 GMT
Reuters - Wednesday February 27, 11:28 GMT
Are Hedges short-circuting Blank Check IPOs?
Reuters - Wednesday February 27, 09:59 GMT
Reuters - Wednesday February 27, 09:59 GMT
NEW YORK (HedgeWorld.com)—A newly available study indicates that a collection of currency return indexes based on easily replicated currency strategies like carry, trend, value and volatility outperforms most currency fund managers. ......
Merrill Says Diversify With Bonds, Not Hedge Funds
Hedgeworld (subscription) - New York,NY,USA
By Emma Trincal, Senior Financial Correspondent | Tuesday, February 26, 2008 NEW YORK (HedgeWorld.com)—Today bonds, not hedge funds, represent the asset ...
Hedgeworld (subscription) - New York,NY,USA
By Emma Trincal, Senior Financial Correspondent | Tuesday, February 26, 2008 NEW YORK (HedgeWorld.com)—Today bonds, not hedge funds, represent the asset ...
Should Hedge Funds Support Barack Obama?
Wall Street Journal - USA
Barack Obama won the endorsement today of Chris Dodd, the head of the Senate’s powerful banking committee and beloved advocate of many of the hedge funds ...
Wall Street Journal - USA
Barack Obama won the endorsement today of Chris Dodd, the head of the Senate’s powerful banking committee and beloved advocate of many of the hedge funds ...
, by Barry Ritholtz
, by Felix Salmon
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Yield Curve Corner
The Fed's Tonic
More rate cuts may be coming, a Federal Reserve leader says, as the central bank worries more about recession than inflation. Read More
More rate cuts may be coming, a Federal Reserve leader says, as the central bank worries more about recession than inflation. Read More
Federal Reserve Chairman Ben Bernanke delivered an economic forecast fraught with risks from housing, labor and credit markets, suggesting policy makers remain on track to lower interest rates further next month. "It is important to recognize that downside risks to growth remain," Bernanke told members of the House Financial Services Committee in prepared semiannual testimony on the state of the economy and monetary policy. Fed officials "will need to judge whether the policy actions taken thus far are having their intended effects," Bernanke said, adding the central bank "will act in a timely manner as needed" to keep the economy on track.
http://online.wsj.com/article/SB120412412525296845.html?mod=djemalertNEWS
http://online.wsj.com/article/SB120412412525296845.html?mod=djemalertNEWS
Japanese government bonds end morning flat before Bernanke testimony
Forbes - NY,USA
Bernanke will speak about monetary policy before the House of Representatives on Wednesday and on the Senate Thursday. although he would avoid [making] a ...
Forbes - NY,USA
Bernanke will speak about monetary policy before the House of Representatives on Wednesday and on the Senate Thursday. although he would avoid [making] a ...
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Natural Disaster Corner
Climate Prediction http://www.nws.noaa.gov/predictions.php
World Meterological Organization http://severe.worldweather.org/
Tornadoes: http://www.disastercenter.com/tornado.htm
Great Sat Pictures of events: http://www.osei.noaa.gov/Events/Current/SVRaust058_GJ.jpg
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Iranian Situation and Other Man Made Disasters
Russia tells Iran to halt enrichment or face sanctions
International Herald Tribune Wed, 27 Feb 2008 10:52 AM PST
Russia warned Iran on Wednesday that unless it ceased uranium enrichment within days Moscow would support new UN sanctions being prepared by the West against the Islamic Republic.
International Herald Tribune Wed, 27 Feb 2008 10:52 AM PST
Russia warned Iran on Wednesday that unless it ceased uranium enrichment within days Moscow would support new UN sanctions being prepared by the West against the Islamic Republic.
UN vote on new Iran sanctions put off to next week: diplomat
AFP via Yahoo! News Wed, 27 Feb 2008 9:45 AM PST
A Security Council vote on new sanctions against Iran over its nuclear defiance won't happen until next week as sponsors of the draft mull new amendments to try to secure unanimous support, a Western diplomat said Wednesday.
AFP via Yahoo! News Wed, 27 Feb 2008 9:45 AM PST
A Security Council vote on new sanctions against Iran over its nuclear defiance won't happen until next week as sponsors of the draft mull new amendments to try to secure unanimous support, a Western diplomat said Wednesday.
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Opalesque’s Corner
Listed fund results: Och-Ziff reports 2007 and Q4 results, GAAP loss of $915m for 2007due to IPO cost, AUM up 48% to $33.4bln, shares rose to $1.27, Following Och-Ziff`s earnings, shares in Blackstone and Fortress pulled higher - Citadel might go for flotation, Och-Ziff``s largest hedge fund, the $20bln OZ Master Fund, has allocated around 10% to credit strategies, mortgages, Ashmore survives market turmoil in last 6months, AUM rise 16% to $36.5bln, performance $2.3bln
- M&A: U.S. gives Blackstone green light to acquire GSO Capital, Fortress looks to take Mapeley private, Henderson rules out acquisition of F&C, signals fresh cost cuts
- Comment: Not just `blow up` risk - Lessons for investors from DB Zwirn
- Opalesque Exclusive: Gerken Capital prepares Greater India, Greater Russia, MENA hedge funds, and PE FoF
- EuroHedge: Tough climate sparks slowdown in new European hedge fund launches and in raised assets, but growth in EM and commodities funds
- Indices: CMBX credit-market index: Critics seek more disclosure, Barclays Capital launches new commodity index, Two funds excluded from Hedge Nordic Index, NYU study shows currency indexes beat most currency fund managers
- Other Voices: Lack of sufficient talent to manage the capital, not lack of capital key issue for many hedge funds, competition for top talents to intensify, funds urged to develop long-term `talent plan`
- Views: Merrill says diversify with bonds, not hedge funds, JPMorgan: Liquidity appears to be returning, BlackRock: Special opportunities exist, US might avoid recession
- Legal: Elliott Management sues Cedar Hill for corporate espionage
- Regulators: SEC struggles to pin insider trading on fund sales
- Credit Crunch Update: Goldman, Lehman may not have dodged credit crisis, variable interest entities (VIEs) may be sources of losses, Comment: Another off-balance sheet time bomb: VIEs, Did UBS dump toxic assets on HSH Nordbank?, Swiss president says no need for UBS bailout, Eurozone government bonds feeling the strain of credit crisis, MBIA unit`s `Aaa` rating affirmed by Moody`s, MBIA CEO on bond insurance (video)
- Debate Update: Replies to Kat`s scepticism on alternative beta
- People: Dr. Ranjan Bhaduri joins AlphaMetrix as managing director of research, New York headhunter Glocap adds Asia hedge-fund recruiter, Citi hires new Hong Kong prime broking salesman, to concentrate on hedge fund managers in the North Asia region
- Opalesque Exclusive: Yoel Goldfeder joins N.I.R. pipe hedge fund
- Exchanges: Nymex stakes in other exchanges a factor in talks with CME
- Environmental Trading News: Point Carbon predicts global carbon market up 56% in 2008, Carbon credits drive The Green Exchange, Lehman starts emissions trading in Japan, will sell UN credits
- Commodities: Asia and Middle-East state-run funds pour cash into commodities, Commerzbank bets big on commodities for 2008
- Institutions: London Borough of Barnet searches independent investment advisor, CalPERS, CalSTRS may be barred from investing in PE and companies owned by SWFs
- Europe: FSA says cheap credit era is over, Gottex enters into advisory agreement with Credito Emiliano`s alternative asset management arm
- Opalesque Exclusive: London searches hedge fund socceros for Marylebone `five-a-side` football league
- Middle-East: Man Middle-East: Alternative instruments key to hedge fund growth, Renaissance Group launches Gulf operations
- Asia: China`s brokers likely to offer margin trading soon, What to expect from the Asian bond market in 2008
- Activist News: New York Times to meet with Harbinger candidates, Media General recommends against Harbinger director slate, TCI agrees to CSX hearing, Hedge funds take a more conciliatory approach with Japan`s boards, Comment: Shareholder activism raises questions of responsibility, should there be limits to shareholder power?, Activist shareholders want more control over climbing executive pay
- Politics: Hedge funds embrace Obama, donate less to Clinton, Should hedge funds support Barack Obama?
- News Briefs: Dollar falls to record low of $1.50 per Euro on rate outlook, Two PerTrac products named finalists in 2008 SIIA CODiE software awards, Update: Shareholder body `likely` to join with Northern Rock hedge funds for lawsuit, London building boom gives way to fears of vacant office space as credit crisis prompts banks to curb expansion plans, Stenham to launch new UK property fund, Jefferies Putnam Lovell promotes London banker Nirav Hathi to managing director, Deutsche Bank establishes research facility in Dubai
- And Finally. Robot patrols Atlanta neighborhood
- Logon: http://www.opalesque.com/main.php?act=archive
- M&A: U.S. gives Blackstone green light to acquire GSO Capital, Fortress looks to take Mapeley private, Henderson rules out acquisition of F&C, signals fresh cost cuts
- Comment: Not just `blow up` risk - Lessons for investors from DB Zwirn
- Opalesque Exclusive: Gerken Capital prepares Greater India, Greater Russia, MENA hedge funds, and PE FoF
- EuroHedge: Tough climate sparks slowdown in new European hedge fund launches and in raised assets, but growth in EM and commodities funds
- Indices: CMBX credit-market index: Critics seek more disclosure, Barclays Capital launches new commodity index, Two funds excluded from Hedge Nordic Index, NYU study shows currency indexes beat most currency fund managers
- Other Voices: Lack of sufficient talent to manage the capital, not lack of capital key issue for many hedge funds, competition for top talents to intensify, funds urged to develop long-term `talent plan`
- Views: Merrill says diversify with bonds, not hedge funds, JPMorgan: Liquidity appears to be returning, BlackRock: Special opportunities exist, US might avoid recession
- Legal: Elliott Management sues Cedar Hill for corporate espionage
- Regulators: SEC struggles to pin insider trading on fund sales
- Credit Crunch Update: Goldman, Lehman may not have dodged credit crisis, variable interest entities (VIEs) may be sources of losses, Comment: Another off-balance sheet time bomb: VIEs, Did UBS dump toxic assets on HSH Nordbank?, Swiss president says no need for UBS bailout, Eurozone government bonds feeling the strain of credit crisis, MBIA unit`s `Aaa` rating affirmed by Moody`s, MBIA CEO on bond insurance (video)
- Debate Update: Replies to Kat`s scepticism on alternative beta
- People: Dr. Ranjan Bhaduri joins AlphaMetrix as managing director of research, New York headhunter Glocap adds Asia hedge-fund recruiter, Citi hires new Hong Kong prime broking salesman, to concentrate on hedge fund managers in the North Asia region
- Opalesque Exclusive: Yoel Goldfeder joins N.I.R. pipe hedge fund
- Exchanges: Nymex stakes in other exchanges a factor in talks with CME
- Environmental Trading News: Point Carbon predicts global carbon market up 56% in 2008, Carbon credits drive The Green Exchange, Lehman starts emissions trading in Japan, will sell UN credits
- Commodities: Asia and Middle-East state-run funds pour cash into commodities, Commerzbank bets big on commodities for 2008
- Institutions: London Borough of Barnet searches independent investment advisor, CalPERS, CalSTRS may be barred from investing in PE and companies owned by SWFs
- Europe: FSA says cheap credit era is over, Gottex enters into advisory agreement with Credito Emiliano`s alternative asset management arm
- Opalesque Exclusive: London searches hedge fund socceros for Marylebone `five-a-side` football league
- Middle-East: Man Middle-East: Alternative instruments key to hedge fund growth, Renaissance Group launches Gulf operations
- Asia: China`s brokers likely to offer margin trading soon, What to expect from the Asian bond market in 2008
- Activist News: New York Times to meet with Harbinger candidates, Media General recommends against Harbinger director slate, TCI agrees to CSX hearing, Hedge funds take a more conciliatory approach with Japan`s boards, Comment: Shareholder activism raises questions of responsibility, should there be limits to shareholder power?, Activist shareholders want more control over climbing executive pay
- Politics: Hedge funds embrace Obama, donate less to Clinton, Should hedge funds support Barack Obama?
- News Briefs: Dollar falls to record low of $1.50 per Euro on rate outlook, Two PerTrac products named finalists in 2008 SIIA CODiE software awards, Update: Shareholder body `likely` to join with Northern Rock hedge funds for lawsuit, London building boom gives way to fears of vacant office space as credit crisis prompts banks to curb expansion plans, Stenham to launch new UK property fund, Jefferies Putnam Lovell promotes London banker Nirav Hathi to managing director, Deutsche Bank establishes research facility in Dubai
- And Finally. Robot patrols Atlanta neighborhood
- Logon: http://www.opalesque.com/main.php?act=archive
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Misc. Items of Interest
Microfinance flourishes as institutions inject funds
http://www.responsible-investor.com/home/article/microfinance/
http://www.responsible-investor.com/home/article/microfinance/
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Funnies, Facts, Quotes, etc….
temerarious em-uh-RAIR-ee-uhs, adjective:
Recklessly or presumptuously daring; rash.
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Conference, Courses, Books, Papers
Great Research Sites:
Merrill Lynch research Link to full report including important disclosures see example
John Mauldin’s Weekly Analysis
James Altucher’s Website:
Other useful sites:
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Index Corner
The CSFB/Tremont Hedge Fund Index www.hedgeindex.com.
The Cogent Dynamic Averages http://www.cogenthedge.com/home/inv_strategy.asphttp://www.cogenthedge.com/home/inv_strategy.asp
The Dow Jones Indices: http://www.djhedgefundindexes.com/index.cfm?event=viewPremiumContent (free registration)
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Regulatory Info
investor.info@sfc.hkhttp://www.sfc.hk/sfc/html/EN/inutilbar/contact/contact.htmlhttp://www.sfc.hk/sfc/html/EN/inutilbar/contact/contact.htmlhttp://www.sfc.hk/sfc/html/EN/inutilbar/contact/contact.html
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Disclaimer
The information contained in this document does not constitute an offer or solicitation to sell any security or other type of vehicles to or by anyone in any jurisdictions, nor should it be regarded as a contractual document. Under no circumstances should the information provided on this document be considered as financial advice, or as a sufficient basis on which to make investment decisions. The information contained herein has been gathered by Investor DNA, LLC from sources deemed reliable as of the date of publication, but no warranty of accuracy or completeness is given. Investor DNA, LLC is not responsible for and provides no guarantee with respect to any of the information provided herein or through the use of any hypertext link. Past results are no indication of future performance. All information in this newsletter is for educational and informational purposes and does not constitute investment, legal, tax or accounting advice. All materials are the property of the
respective publishers, as referenced by header and appropriate hypertext links.
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