Post by sweetredfl on Oct 16, 2007 20:15:32 GMT -5
Corporate Treasurers in Flight to Quality - Cash at Record Levels
biz.yahoo.com/bw/071016/20071016005994.html?.v=1
Housing now biggest risk to U.S. economy: Paulson
www.marketwatch.com/news/story/housing-now-biggest-risk-us/story.aspx?guid=%7B1E167B2F%2D4E8E%2D432A%2D840C%2D2DD1F8C4612B%7D&siteid=yhoof
Global financial system out of intensive care, IMF says
www.marketwatch.com/News/Story/Story.aspx?guid=%7bCB98159D-0CD6-46DB-968F-CC105B62E344%7d&siteid=yhoo&dist=yhoo
____________
MARKETS
biz.yahoo.com/hmoney/071016/101507_daredevil_moneymag.html?.v=2
Cold feet in a hot market
Paulson: Housing Crisis Needs Action
biz.yahoo.com/ap/071016/paulson_housing.html?.v=2
_______
MINING
Hedge Mining Stocks on China Congress, Goldman Says
quote.bloomberg.com/apps/news?pid=20601087&sid=aY4WaLIZOKuY
Diamonds to Rise on Deficit, Russia's Alrosa Says
quote.bloomberg.com/apps/news?pid=20601012&sid=aKZaAiR8V3SY&refer=commodities
www.stockwatch.com/swnet/newsit/newsit_newsit.aspx?bid=B-738273-C:GAI&symbol=GAI&news_region=C
Golden Arch Resources Ltd. optionholders have exercised 2.3 million options at a price of 12 cents per share, netting the company $276,000.
biz.yahoo.com/ccn/071016/200710160419301001.html?.v=1
Star Uranium Corp. Announces Changes in Directors
biz.yahoo.com/ccn/071016/200710160419303001.html?.v=1
Shane Resources Ltd. Announces Changes in Directors
announced today that Mr. Mike Magrum and Mr. Rick Kusmirski have resigned from the Board of Directors effective immediately. The Company would like to thank both gentlemen for their past contributions
biz.yahoo.com/ccn/071016/200710160419304001.html?.v=1
United Uranium Corp. Announces Changes in Directors
________
SEC
The New Insider Trading Cases and Warnings to the Market: Effective Enforcement?
www.secactions.com/?p=257
__________
BANKS
news.bbc.co.uk/1/hi/business/7046871.stm Lloyds sued for money-laundering - Lloyds TSB says it will vigorously defend a money-laundering lawsuit brought by US prosecutors.
Lloyds and Bank of Cyprus face civil charges alleging they helped launder hundreds of millions of dollars from a securities fraud.
Tuesday, Oct. 16 2007 Buy Order: Dismantling of Citigroup and CEO Could Aid Stock Price
www.foxbusiness.com/article/buy-order-dismantle-citigroup-ceo_308094_1.html
Credit crisis 'made in Canada'
Lax Rules Blamed
Duncan Mavin and john Greenwood, National Post, With Files From Sean Silcoff; National Post
Published: Thursday, September 27, 2007
Canadian banks are struggling to contain a credit crisis that could spiral out of control here more than it has elsewhere because of a lax regulatory regime, sources have told the National Post.
The crisis relates to the market for a complex type of short-term funding known as asset backed commercial paper (ABCP), which had grown out of proportion in this country partly thanks to Canadian rules that were not as tough as in other nations.
"It's a made-in-Canada problem," said Claude Lamoureux, head of Ontario Teachers' Pension Plan. Many people in the market "didn't know or didn't ask questions" because they were making more profits than elsewhere, he added.
The Canadian ABCP market attracted a flood of foreign financial institutions such as Barclays Bank and Deutsche Bank, who exploited the gaps in the Canadian ABCP rules to make big profits at lower risk to themselves, sources said.
"They were effectively able to earn fees from supplying liquidity without ever having to supply the liquidity or set aside capital," said a source.
In the worst-case scenario, if global financial players lose confidence in the Canadian ABCP system altogether, the crisis could spread to Canada's big banks, leaving them on the hook for tens of billions of dollars.
ABCP is a package of debt obligations -- anything from car loans to credit-card debt. The product grew in popularity in recent years among everyone from pension funds to corporate treasury departments to banks because ABCP offered higher returns than, for example, a corporate bond or treasury bill.
Typically, ABCP products also involve liquidity support from a supplier, usually a major bank. In simple terms it is an agreement to buy the ABCP in the event of a disruption to the market.
In Canada, the market grew more quickly than in other countries, doubling between 2000 and 2007 to $120-billion, because the Canadian definition of disruption to the market was much narrower than elsewhere.
In Canada, liquidity suppliers did not have to provide funding except in catastrophic circumstances.
Also the Canadian banking regulator, unlike regulators in other countries, did not ask the liquidity supplier -- the bank -- to set aside any capital, so they could use it to grow other lines of business.
"ABCP growth outstripped traditional personal and commercial loan growth," and was "meaningfully above the pace of U.S. ABCP market expansion," said Blackmont Capital banking analyst Brad Smith.
In addition, Canadian debt rating agency Dominion Bond Rating Service gave a rating to Canadian ABCP even though other rating agencies such as Moody's and Standard & Poors shied away from doing so.
By June this year, Canada's ABCP market was about 10% of the size of the market in the United States, although the overall U.S. financial system is proportionately far larger than Canada's.
When concerns surfaced in August about the underlying assets in ABCP -- many of which have included troubled mortgage loans in the U.S. -- some owners of ABCP were caught off guard. Owners of ABCP were under the belief that they could convert it to cash or another similar product at the end of 30 or 60 days but instead were left holding the product.
Canadian investment bank Coventree Capital Inc. became one of the first major victims of the global credit crunch when it was unable to trade the ABCP it was holding because of the general seizing up of credit markets around the world.
Following Coventree's collapse, Canadian non-bank owners of $40-billion of troubled asset-backed commercial paper -- pension funds and corporate treasury departments -- were forced into an unprecedented joining-of-forces known as the Mont-real Accord to try to salvage their holdings.
If the Montreal Accord does not result in a long-term agreement on how to resolve the issues in Canada's non-bank ABCP market by an Oct. 15 deadline, there could be a carryover effect on the demand generally for ABCP, said Blackmont's Mr. Smith.
"Failure to fully restore investor confidence levels could reduce demand ...which could restrict the future ability of banks to manage capital," he said.
Mr. Smith calculated that Canada's big six banks are on the hook for total liquidity facilities worth $135-billion.
Canada's bank regulator -- the Office of the Superintendent of Financial Institutions -- did not return calls from the National Post seeking comment for this story. However, in an e-mail the regulator indicated that the rules enforced in Canada were in accordance with international guidelines.
HOW IT WORKS - A bank packages a collection of mortgages, credit card balances, or lines of credit into an ABCP that matures in 30 days. - The bank sells ABCP for a fee to an intermediary that assumes all the risk associated with the underlying assets. - The intermediary sells pieces of the ABCP to investors, including pension funds or corporations or individuals. - Investors are paid interest and assume there will be a buyer for their piece of the ABCP after 30 days. - For a fee, the bank supplies funds to buy the ABCP if there are no other buyers - in Canada, this feature did not work in August when investors could not find a buyer.
© National Post 2007
www.canada.com/nationalpost/news/story.html?id=3f92dc01-2dce-41a1-8035-358121a6725a&k=638
biz.yahoo.com/bw/071016/20071016005994.html?.v=1
Housing now biggest risk to U.S. economy: Paulson
www.marketwatch.com/news/story/housing-now-biggest-risk-us/story.aspx?guid=%7B1E167B2F%2D4E8E%2D432A%2D840C%2D2DD1F8C4612B%7D&siteid=yhoof
Global financial system out of intensive care, IMF says
www.marketwatch.com/News/Story/Story.aspx?guid=%7bCB98159D-0CD6-46DB-968F-CC105B62E344%7d&siteid=yhoo&dist=yhoo
____________
MARKETS
biz.yahoo.com/hmoney/071016/101507_daredevil_moneymag.html?.v=2
Cold feet in a hot market
Paulson: Housing Crisis Needs Action
biz.yahoo.com/ap/071016/paulson_housing.html?.v=2
_______
MINING
Hedge Mining Stocks on China Congress, Goldman Says
quote.bloomberg.com/apps/news?pid=20601087&sid=aY4WaLIZOKuY
Diamonds to Rise on Deficit, Russia's Alrosa Says
quote.bloomberg.com/apps/news?pid=20601012&sid=aKZaAiR8V3SY&refer=commodities
www.stockwatch.com/swnet/newsit/newsit_newsit.aspx?bid=B-738273-C:GAI&symbol=GAI&news_region=C
Golden Arch Resources Ltd. optionholders have exercised 2.3 million options at a price of 12 cents per share, netting the company $276,000.
biz.yahoo.com/ccn/071016/200710160419301001.html?.v=1
Star Uranium Corp. Announces Changes in Directors
biz.yahoo.com/ccn/071016/200710160419303001.html?.v=1
Shane Resources Ltd. Announces Changes in Directors
announced today that Mr. Mike Magrum and Mr. Rick Kusmirski have resigned from the Board of Directors effective immediately. The Company would like to thank both gentlemen for their past contributions
biz.yahoo.com/ccn/071016/200710160419304001.html?.v=1
United Uranium Corp. Announces Changes in Directors
________
SEC
The New Insider Trading Cases and Warnings to the Market: Effective Enforcement?
www.secactions.com/?p=257
__________
BANKS
news.bbc.co.uk/1/hi/business/7046871.stm Lloyds sued for money-laundering - Lloyds TSB says it will vigorously defend a money-laundering lawsuit brought by US prosecutors.
Lloyds and Bank of Cyprus face civil charges alleging they helped launder hundreds of millions of dollars from a securities fraud.
Tuesday, Oct. 16 2007 Buy Order: Dismantling of Citigroup and CEO Could Aid Stock Price
www.foxbusiness.com/article/buy-order-dismantle-citigroup-ceo_308094_1.html
Credit crisis 'made in Canada'
Lax Rules Blamed
Duncan Mavin and john Greenwood, National Post, With Files From Sean Silcoff; National Post
Published: Thursday, September 27, 2007
Canadian banks are struggling to contain a credit crisis that could spiral out of control here more than it has elsewhere because of a lax regulatory regime, sources have told the National Post.
The crisis relates to the market for a complex type of short-term funding known as asset backed commercial paper (ABCP), which had grown out of proportion in this country partly thanks to Canadian rules that were not as tough as in other nations.
"It's a made-in-Canada problem," said Claude Lamoureux, head of Ontario Teachers' Pension Plan. Many people in the market "didn't know or didn't ask questions" because they were making more profits than elsewhere, he added.
The Canadian ABCP market attracted a flood of foreign financial institutions such as Barclays Bank and Deutsche Bank, who exploited the gaps in the Canadian ABCP rules to make big profits at lower risk to themselves, sources said.
"They were effectively able to earn fees from supplying liquidity without ever having to supply the liquidity or set aside capital," said a source.
In the worst-case scenario, if global financial players lose confidence in the Canadian ABCP system altogether, the crisis could spread to Canada's big banks, leaving them on the hook for tens of billions of dollars.
ABCP is a package of debt obligations -- anything from car loans to credit-card debt. The product grew in popularity in recent years among everyone from pension funds to corporate treasury departments to banks because ABCP offered higher returns than, for example, a corporate bond or treasury bill.
Typically, ABCP products also involve liquidity support from a supplier, usually a major bank. In simple terms it is an agreement to buy the ABCP in the event of a disruption to the market.
In Canada, the market grew more quickly than in other countries, doubling between 2000 and 2007 to $120-billion, because the Canadian definition of disruption to the market was much narrower than elsewhere.
In Canada, liquidity suppliers did not have to provide funding except in catastrophic circumstances.
Also the Canadian banking regulator, unlike regulators in other countries, did not ask the liquidity supplier -- the bank -- to set aside any capital, so they could use it to grow other lines of business.
"ABCP growth outstripped traditional personal and commercial loan growth," and was "meaningfully above the pace of U.S. ABCP market expansion," said Blackmont Capital banking analyst Brad Smith.
In addition, Canadian debt rating agency Dominion Bond Rating Service gave a rating to Canadian ABCP even though other rating agencies such as Moody's and Standard & Poors shied away from doing so.
By June this year, Canada's ABCP market was about 10% of the size of the market in the United States, although the overall U.S. financial system is proportionately far larger than Canada's.
When concerns surfaced in August about the underlying assets in ABCP -- many of which have included troubled mortgage loans in the U.S. -- some owners of ABCP were caught off guard. Owners of ABCP were under the belief that they could convert it to cash or another similar product at the end of 30 or 60 days but instead were left holding the product.
Canadian investment bank Coventree Capital Inc. became one of the first major victims of the global credit crunch when it was unable to trade the ABCP it was holding because of the general seizing up of credit markets around the world.
Following Coventree's collapse, Canadian non-bank owners of $40-billion of troubled asset-backed commercial paper -- pension funds and corporate treasury departments -- were forced into an unprecedented joining-of-forces known as the Mont-real Accord to try to salvage their holdings.
If the Montreal Accord does not result in a long-term agreement on how to resolve the issues in Canada's non-bank ABCP market by an Oct. 15 deadline, there could be a carryover effect on the demand generally for ABCP, said Blackmont's Mr. Smith.
"Failure to fully restore investor confidence levels could reduce demand ...which could restrict the future ability of banks to manage capital," he said.
Mr. Smith calculated that Canada's big six banks are on the hook for total liquidity facilities worth $135-billion.
Canada's bank regulator -- the Office of the Superintendent of Financial Institutions -- did not return calls from the National Post seeking comment for this story. However, in an e-mail the regulator indicated that the rules enforced in Canada were in accordance with international guidelines.
HOW IT WORKS - A bank packages a collection of mortgages, credit card balances, or lines of credit into an ABCP that matures in 30 days. - The bank sells ABCP for a fee to an intermediary that assumes all the risk associated with the underlying assets. - The intermediary sells pieces of the ABCP to investors, including pension funds or corporations or individuals. - Investors are paid interest and assume there will be a buyer for their piece of the ABCP after 30 days. - For a fee, the bank supplies funds to buy the ABCP if there are no other buyers - in Canada, this feature did not work in August when investors could not find a buyer.
© National Post 2007
www.canada.com/nationalpost/news/story.html?id=3f92dc01-2dce-41a1-8035-358121a6725a&k=638