Хронология из DJN Market Talk

 

By John Hughes

 

Dec. 10 (Bloomberg) -- The House approved a $14 billion loan package intended to prevent a collapse of domestic automakers that would threaten millions of U.S. jobs. The 237-170 vote sends the measure to the Senate, where opposition is growing.

Tonight’s action could be a lifeline to General Motors Corp. and Chrysler LLC, which said they would run out of cash within weeks. The Bush administration and Democratic leaders in Congress backed the measure, which they said would force the automakers to restructure to achieve financial viability or repay the loans.

“It’s tough love for an industry whose success is essential to our economic success,” said House Speaker Nancy Pelosi. The measure was supported by 205 Democrats and 32 Republicans.

The legislation calls for the appointment of a so-called car czar to loan money to the automakers while requiring them to submit long-term plans on how they will return to financial viability. The czar could provide additional financial help to implement a company plan, or order repayment of a loan if the plan is inadequate.

The czar, who would be appointed by the president, could force the companies into bankruptcy unless they come up with a restructuring plan by March 31.

“What happens to the U.S. auto industry affects us all,” said Representative Louise Slaughter, a New York Democrat. “We have an obligation to take action.”

Vetoing Spending

The measure would give the car czar power to veto automaker expenditures over $100 million. Car companies that take loans would have to limit pay and ban bonuses for their 25 most highly paid executives. They also would be barred from owning or leasing passenger aircraft or paying dividends to shareholders.

Taxpayers would receive stock warrants equal to 20 percent of the aid.

Some Republicans said the measure would waste taxpayer money without saving the companies.

The bailout plan “won’t save a single job,” said Representative David Dreier, a California Republican.

The House approved an amendment that would require financial institutions that receive money from the $700 billion Troubled Asset Relief Program to report any change in lending.

In the Senate, Republicans said the bill lacked the 60 votes needed to overcome delaying tactics threatened by some members. Democrats have a 50-49 edge in the Senate.

‘Respond to Concerns’

“I don’t think the votes are there on our side of the aisle, and I think that some effort needs to be made to respond to some of the concerns of my colleagues,” said Senator George Voinovich of Ohio after meeting with fellow Republicans.

Some lawmakers pushed for changes in the role of the czar. Senator Robert Bennett, a Utah Republican, said the czar wouldn’t have enough authority and should have the power to create a “de facto” bankruptcy.

“The creation of the car czar is absolutely essential,” Bennett said. “If you just put money in and you don’t have a de facto structured bankruptcy, you’re in real trouble.”

Lawmakers can continue working on the package into next week if necessary to make the changes, said Republican Senators Christopher Bond of Missouri and Tom Coburn of Oklahoma.

“There are some changes that would be beneficial that might help us bring enough votes to get the 60 votes needed to pass it,” Bond told reporters.

Senate Democrat Max Baucus of Montana, chairman of the Finance Committee, said he will vote against the legislation because it includes a tax provision benefiting transit agencies.

 

To contact the reporters on this story:

John Hughes in Washington at Jhughes5@bloomberg.net

 

 

 

 

 

 

By Stanley White

 

Dec. 11 (Bloomberg) -- The yen rose against the euro on speculation a lack of Republican support for a bailout of U.S. automakers will prompt investors to pare holdings of assets funded with Japan’s currency.

The yen also gained versus the dollar after Republican Senator George Voinovich said yesterday legislation to provide $15 billion in federal loans to General Motors Corp. and Chrysler LLC may not have enough votes from his party to pass the Senate. South Korea’s won climbed for a fifth day against the greenback after the central bank cut interest rates to a record low to prevent the economy from slipping into a recession.

“No one is sure how the automaker rescue package will turn out, and that’s making some people nervous,” said Saburo Matsumoto, senior manager of foreign-exchange sales at Sumitomo Trust & Banking Co. “The global economy clearly has problems. This will pressure the dollar to go lower against the yen.”

The yen gained to 120.46 per euro as of 10:28 a.m. in Tokyo from 120.78 late yesterday in New York. Against the dollar, the yen traded at 92.50 from 92.76. The euro was little changed at $1.3021. The yen may rise to 91 against the dollar today, Tokyo- based Matsumoto said.

The South Korean won rose 2.2 percent to 1,363.50 per dollar, after touching 1.345.50, the strongest level in three weeks. The Bank of Korea lowered its benchmark rate a larger- than-expected 1 percentage point to 3 percent.

Currency Swaps

Japan will expand its currency-swap agreement with South Korea to help its neighbor obtain foreign currency, Japanese Vice Finance Minister for international affairs Naoyuki Shinohara told reporters in Tokyo today. Policy makers are still discussing the amount of the swap increase, Japan’s top currency official said. The won is down 31 percent against the dollar this year, making it Asia’s worst performer.

The yen gained this year against all 178 currencies tracked by Bloomberg as the global recession encouraged Japanese investors to repatriate funds. The yen appreciated 21 percent versus the dollar, 35 percent against the euro and 66 percent against Brazil’s real as so-called carry trades unwound.

The dollar gained 12 percent against the euro this year as the credit-market seizure and $980 billion of losses on mortgage-related securities worldwide led investors to repatriate overseas investment to the U.S. and seek shelter in government debt.

Automaker Bailout

The Bush administration is lobbying Republican lawmakers to support a plan to rescue General Motors and Chrysler, officials said. Legislation in the House of Representatives calls for the appointment of a car czar who may force the automakers into Chapter 11 bankruptcy if the companies don’t come up with a restructuring plan by March 31.

The dollar may extend its decline as the U.S. government increases its budget deficit by spending “trillions of dollars” to revive the economy, according to Bill Gross, manager of the world’s biggest bond fund at Pacific Investment Management Co. in Newport Beach, California.

“There’s some risk” for the dollar to weaken, said Gross in an interview on Bloomberg Television yesterday. “It is fair to say other economies are doing much the same thing. The dollar doesn’t have to go south if all the economies reflate at the same time.”

The ICE’s Dollar Index, which tracks the greenback against the euro, the yen, the pound, the Canadian dollar, the Swiss franc and Sweden’s krona, was little changed at 85.405. It touched 88.463 on Nov. 21, the highest since April 2006.

State Street Global Markets recommended investors erase bets that the dollar will gain versus the euro as major central banks’ interest rates are “nearing the bottom.” Policy makers in Canada, Europe, the U.K., Sweden, Australia and New Zealand lowered interest rates this month.

“Narrowing interest-rate differentials will soon fade as a force in the foreign-exchange market,” Dwyfor Evans, a Hong Kong-based currency analyst at the company, wrote in a research note to clients yesterday.

 

To contact the reporters on this story:

Stanley White in Tokyo at swhite28@bloomberg.net.

 

 

By Jamie McGee

 

Dec. 10 (Bloomberg) -- Most of the Group of 10 currencies haven’t benefited from interest-rate cuts, and further monetary easing will result in greater depreciation in the near term, according to Bank of Tokyo-Mitsubishi Ltd.

The Australian dollar, British pound, Canadian dollar, Norwegian krone, Swedish krona and New Zealand dollar will weaken over the next three months as a result of lowered interest rates, according to the bank. The other G-10 currencies are the U.S. dollar, euro, yen and Swiss franc.

“The data clearly implies that as yet growth-supportive monetary policies have not been rewarded by currency outperformance in the G-10 space, reaffirming our belief that major currencies will continue to be undermined in coming months by further monetary easing,” Lee Hardman, a currency strategist at Bank of Tokyo-Mitsubishi in London, wrote in a note today.

The Group of 10’s central banks lowered interest rates by a cumulative total of 18.2 percentage points since the beginning of October. Their currencies depreciated an average of 0.32 percent on the day of the rate cuts and 2.85 percent during the week of the rate cuts, according to Hardman.

The daily exceptions were the Swiss franc and the Australian dollar, which both gained on average, Hardman wrote. The U.S. dollar and the euro were the weekly exceptions. The dollar climbed an average of 1.08 percent in the weeks after the Federal Reserve cut borrowings costs, while the euro gained 0.67 percent, according to Bank of Tokyo.

Currencies may eventually strengthen for countries that revive their strained economies, Hardman wrote.

Dollar Index

The ICE’s Dollar Index, which tracks the dollar against the euro, the yen, the pound, the Canadian dollar, the Swiss franc and Sweden’s krona, has climbed 5.6 percent since the Fed lowered its rate by a half-percentage point on Oct. 8, when global central banks made coordinated reductions. The dollar has gained more from demand for a haven than from monetary easing, according to Bank of Tokyo.

The Fed will lower its overnight lending rate by a half- percentage point to 0.5 percent when policy makers meet Dec. 16, according to the median forecast of 72 economists in a Bloomberg News survey. Forecasts range from no rate change to a 1 percentage point cut to zero.

The Bank of England cut its overnight rate by 3 percentage points since October, the most aggressive monetary easing among the Group of 10 currencies. Sterling depreciated on average 2.59 percent in the weeks during the announcements, according to Bank of Tokyo. The pound fell 14 percent against the dollar since the central bank lowered its rate on Oct. 8.

 

To contact the reporter on this story:

Jamie McGee in New York at jmcgee8@bloomberg.net

 

 

 

 

 

2008.12.10 22:38:26   Fed-Funds Futures See 94% Odds Of 75 BP Cut Tues

2008.12.10 22:31:19   GLOBAL YIELD: Give Us More! Foreign Buyers Clamor For US Debt

2008.12.10 22:31:16   Dow Jones 3:30 PM Averages: DJIA 8771.30 UP 79.97      

2008.12.10 22:31:11   Outcome Of US Automaker Rescue Talks May Steer NZX   

2008.12.10 22:24:17   Euro Hits Two-Week High Vs Dollar

2008.12.10 22:12:17   Pimco's Gross: Signs Of 'Bubble' In Parts Of Tsy Mkt-Bloomberg

2008.12.10 22:01:30   Funding Costs To Remain High In 2009-Barclays

2008.12.10 21:35:03   US Stocks Pare Gains; Consumer, Financial Sectors Fall       

2008.12.10 21:34:22   OIL FUTURES: Front End Of Nymex Crude Curve Strengthens

2008.12.10 21:32:11   OIL FUTURES: Nymex Crude Ends At $43.10/Bbl, Up $1.03

2008.12.10 21:10:06   MARKET TALK: US Stocks Fade Gains As Blue Chips Weaken

2008.12.10 21:03:23   MARKET TALK: Buying Back To Tsys As US Stocks Lose Gains

2008.12.10 21:00:47   Dow Jones 2 PM Averages: DJIA 8683.84 DN 7.49 

2008.12.10 21:00:37   US Govt Posted $164.40 Bln Total Budget Deficit In November

2008.12.10 21:00:20   US Govt October Deficit Unrevised At $237.18 Bln  

 

 

Дефицит федерального бюджета США в ноябре 2008г. - втором месяце 2008-2009 финансового года - вырос на 67,4% по сравнению с ноябрем прошлого года и составил рекордное значение для месяца - 164,4 млрд долл. против 98,2 млрд долл. годом ранее.

Расходы федерального правительства США в ноябре 2008г. составили 309,2 млрд долл., включая затраты в размере 76,5 млрд долл., направленных на выкуп ценных бумаг крупнейших финансовых институтов страны, передает Associated Press со ссылкой на Министерство финансов США.

Напомним, в октябре - первом месяце нового бюджетного года - дефицит федерального бюджета США составил 237,2 млрд долл.

Между тем октябрьский показатель также поставил рекорд, намного превысив ожидания аналитиков, и оказался в несколько раз больше бюджетного дефицита за октябрь 2007г., который составлял 56,8 млрд долл.

Расходы правительства США в октябре 2008г. составили 402 млрд долл. Столь огромную сумму обусловили затраты правительства на покупку акций крупнейших банков страны: администрация США направила в октябре с.г. на эти цели 115 млрд долл. - первую часть из 700 млрд долл., которые были выделены в рамках программы помощи финансовому сектору.

В 2007-2008 бюджетном году, завершившемся 30 сентября с.г., дефицит федерального бюджета США составил 454,8 млрд долл.

 

 

 

2008.12.10 20:56:06   US Stocks Pare Gains; DJIA Up 4, SnP 500 Up 2   

2008.12.10 20:47:03   FOREX VIEW: Russia Ruble Will Decline, But Crisis Far Off

2008.12.10 20:33:17   UPDATE: US Labor Dept Says Nov Jobs Data Released Early

2008.12.10 20:30:14   Noyer Says Can't Exclude Some Months Of "Negative Inflation"        

2008.12.10 20:30:17   Noyer Says Not Worried About A Full-Blown Deflation-Report

2008.12.10 20:30:20   Noyer: Significantly Negative 4Q French, Eurozone GDP Indicated

2008.12.10 20:20:06   EUR Extends Gains Vs USD As Stocks, Oil Up

2008.12.10 20:12:12   US Sen Baucus Says Will Oppose Auto Bill in Current Form

2008.12.10 20:08:42   MARKET TALK: 3-Yr Treasurys Fall After $28 Bln Auction

2008.12.10 20:05:03   MARKET TALK: Indirect Bid For 3-Yr Note Is 35.3%       

2008.12.10 20:03:15   MARKET TALK: Newly Auctioned 3-Year Tsy Yields 1.245%

2008.12.10 20:01:22   Dow Jones 1 PM Averages: DJIA 8767.15 UP 75.82           

2008.12.10 20:01:16   Key Interest Rates At 1 PM EST; 10-Yr Note Yld 2.698%   

2008.12.10 19:48:18   US Stocks Higher On Jump For Energy, Materials Cos          

2008.12.10 19:39:10   UPDATE:IMF Lipsky: Likely To Revise GDP Forecasts Down In Jan

2008.12.10 19:36:02   Obama Calls For Ill. Gov Blagojevich To Resign - Report      

2008.12.10 19:31:57   Some GOP Sens Pledge To Fight Auto Bailout Bill     

2008.12.10 19:30:07   MARKET TALK: Car Czar Will Bring Them Together...       

2008.12.10 19:08:50   US Labor: 3Q Productivity Also Released Early By One Wire Svc

2008.12.10 19:08:23   US Labor Dept: Nov Jobs Report Was Released 25 Seconds Early By One Wire Svc          

2008.12.10 18:25:41   UK Darling: We're Not Looking At Quantitative Easing Right Now

2008.12.10 18:25:10   UK Darling: Quantitative Easing Wld Require Tsy Approval

2008.12.10 18:16:13   ECB Nowotny: Some Mkt Normalization Likely In 1Q – Reuters

2008.12.10 18:15:07   UPDATE: US Wholesale Inventories Drop In October          

2008.12.10 18:11:40   Woolworths To Begin Closing Down Sale Thursday - Sky News

2008.12.10 18:08:56   MARKET TALK: Canada Bonds Down As Safe-Haven Flows Unwound

2008.12.10 18:08:10   UPDATE: South Ossetian Rebels Fire On OSCE Monitors – Georgia

 

 

By Tomoko Yamazaki

 

Dec. 11 (Bloomberg) -- The global hedge-fund industry lost $64 billion of assets in November, with an index tracking its performance declining for a sixth month as economies in Asia and Europe joined the U.S. in recession, Eurekahedge Pte said.

Market declines contributed to $18 billion in net losses, while investor redemptions made up $46 billion, Singapore-based Eurekahedge said, based on preliminary figures taken from 41 percent of the funds it surveys. It said hedge-fund assets shrank by $110 billion to $1.65 trillion in October.

The slump takes declines to 13 percent this year as hedge funds accelerate job cuts and brace for the biggest annual losses and investor withdrawals since at least 2000, according to Eurekahedge data. Funds including Chicago-based Citadel Investment Group LLC, run by Kenneth Griffin, have been forced to liquidate funds, limit withdrawals and eliminate jobs.

“It’s very clear that there is going to be significant consolidation in the hedge-fund industry,” said Duncan Smith, a partner in Hong Kong at Ogier, a firm that provides corporate and legal services to financial companies. “Conditions are quite difficult and that really goes without saying. Underlying liquidity is very hard for funds.”

Hedge funds fell 0.4 percent on average in November, as measured by the Eurekahedge Hedge Fund Index, which tracks the performance of more than 2,000 funds that invest globally. The final figure for the month may be a 2 percent decline, said Eurekahedge, which typically receives data from poorer performing funds later.

Distressed Selling

Hedge-fund industry assets peaked at $1.9 trillion in June, data compiled by Chicago-based Hedge Fund Research Inc. show. Investment losses and withdrawals may shrink that amount by 45 percent by the end of this month, according to estimates by analysts at Morgan Stanley.

Distressed selling and the rollback of debt-funded investments continued to pull down funds as the credit crisis sent the U.S., Europe and Japan into the first simultaneous recession since World War II. The MSCI World Index slumped 6.7 percent last month.

In regional terms, the Eurekahedge Japan Hedge Fund Index was the best performer, gaining 0.8 percent last month, followed by an index measuring Latin America funds, which rose 0.7 percent.

The Eurekahedge Eastern Europe & Russia Hedge Fund Index was the worst performer, dropping 3.7 percent, while the North American and European indexes declined 2.1 percent and 0.6 percent, respectively.

Managers that trade fixed income were the best performers in November, gaining 2.4 percent. Those trading futures, or CTAs, and so-called macro-fund managers, who wager on trends in stocks, bonds and currencies worldwide, advanced 2 percent and 1.1 percent. The index measuring hedge funds investing in distressed debt was the worst performer, sliding 3.3 percent.

Hedge funds are mostly private pools of capital whose managers participate substantially in the profits from their speculation on whether the price of assets will rise or fall.

 

To contact the reporter on this story:

Tomoko Yamazaki in Tokyo at tyamazaki@bloomberg.net

 

 

By Reg Curren

 

Dec. 10 (Bloomberg) -- Natural gas in New York gained for a second day amid speculation that lower temperatures will prompt more demand for the heating fuel.

Natural gas futures rebounded from a 15-month low as below- normal temperatures forecast in the Midwest, where 72 percent of households rely on gas for heating, are expected to move into the New York area by Dec. 12, according to MDA Federal Inc.’s EarthSat Energy Weather.

The forecast “going into the weekend seems to be that it’s going to get pretty bitter, though it’s very short duration,” said George Hopley, an analyst at Barclays Capital in New York.

Gas for January delivery rose 10.7 cents, or 1.9 percent, to settle at $5.686 per million British thermal units at the 3:06 p.m. on the New York Mercantile Exchange. The price earlier rose as much as 3.8 percent.

Futures appear to have found support around $5.50 per million Btu, said Michael Rose, a director of trading at Angus Jackson Inc. in Fort Lauderdale, Florida.

“It dipped slightly below that yesterday and couldn’t hold it and went up,” he said. “We are in wintertime, so it’s very hard to sell natural gas futures.”

The government is scheduled to release its next weekly storage update tomorrow at 10:35 a.m. in Washington. Inventories probably dropped 85 billion cubic feet, based on the median of 11 analyst estimates compiled by Bloomberg. The five-year average drop for the week is 108 billion.

Rising Commodities

Rising commodities also helped to lift natural gas, said Gordy Elliott, a director at FC Stone LLC in St. Louis Park, Minnesota.

“Other commodities in general have been running up, partly because we’re bailing out GM, Ford and Chrysler,” said Elliott. “Buyers are grabbing any bit of good news and away it goes. There’s so much strength in the other trading pits that natural gas will follow whether it’s right or wrong.”

Oil climbed on speculation that the economy and energy demand will recover as U.S. lawmakers hammer out a $15 billion bailout of automakers.

Crude oil for January delivery rose $1.87, or 4.4 percent, to $43.94 a barrel on the exchange.

 

To contact the reporter on this story:

Reg Curren in Calgary at rcurren@bloomberg.net.

 

 

By Chris Reiter

 

Dec. 10 (Bloomberg) -- Bayerische Motoren Werke AG and Daimler AG, the largest luxury-car makers, stand to benefit more from a government rescue of the U.S. automobile industry than if their competitors go bankrupt.

A proposal to grant General Motors Corp. and Chrysler LLC $15 billion in emergency funding should avert a meltdown that would depress sales and drag down the financially strapped parts makers that supply the European companies’ plants both in North America and elsewhere.

“You can’t underestimate what would happen when a large player collapses,” BMW Chief Executive Officer Norbert Reithofer said yesterday in an e-mailed response to questions. “That would impact the supplier structure and therefore the entire industry.”

The U.S. is the No. 1 market for the Munich-based company and the second-biggest for Daimler’s Mercedes-Benz. Both carmakers have factories there, and while they and other German brands control about 7 percent of the American market, they compete more with each other than with GM and Ford Motor Co.

Any sales boost resulting from the collapse of a U.S. carmaker would come “in the very long term,” said Nigel Griffiths, London-based director of research firm IHS Global Insight. “In the short term, volumes would come heavily down because of the impact of a collapse on the real economy and the American psyche.”

Vote Imminent

Congressional Democrats sent President George W. Bush a draft proposal for a bailout package on Dec. 8 that calls for a government-appointed “car czar” to oversee long-term industry restructuring as a condition for aid. A vote on the measure may come as early as today.

BMW rose 50.5 cents, or 2.3 percent, to 22.62 euros in Frankfurt. The stock has declined 47 percent this year. Daimler advanced 0.9 percent to 25.90 euros and has slid 61 percent this year. GM was down 2.8 percent at $4.57 as of 12:43 p.m. in New York amid concern the bailout may be run into Republican stalling tactics in the Senate. It has lost 82 percent in 2008.

Stuttgart, Germany-based Porsche SE, maker of the iconic 911 sports car, also counts the U.S. as its largest market, while Volkswagen AG, the biggest European carmaker, is building its second North American plant in Chattanooga, Tennessee.

Daimler of Stuttgart and Wolfsburg-based VW declined to comment on the U.S. bailout. Porsche didn’t return calls.

Continental, Bosch

Parts purchased by manufacturers account for 75 percent of the value of an average car, according to Germany’s VDA industry group. That makes Continental AG, Robert Bosch GmbH and Magna International Inc., which all make parts for both U.S. and European customers, critical for maintaining production.

Many components are unique to specific models, making it tough for carmakers to mix and match between suppliers. Anti- lock brakes for GM’s Chevrolet Suburban, for instance, wouldn’t be suitable for Volkswagen’s Golf.

“It could get enormously messy,” said IHS’s Griffiths. “Most carmakers have people looking at the security of their supply chain. Those are the people working overtime right now.”

The threat to U.S. revenue comes as car sales in Germany are forecast to drop 6.5 percent next year to the lowest since reunification in 1990, according to the VDA. The auto industry in Europe’s largest economy accounts for one in eight jobs.

“Germany wouldn’t be spared the fallout should one of the top three U.S. automakers collapse,” said Klaus Lippold, chairman of the German parliament’s transportation committee and a member of Chancellor Angela Merkel’s CDU party. “If the U.S. car industry slumps, we’re going to feel the consequences.”

Congress is considering a bailout for U.S. automakers even as their European counterparts lobby for 40 billion euros ($52 billion) in low-interest loans and incentives to scrap vehicles more than eight years old in an initiative led by the Brussels- based European Automobile Manufacturers Association.

Fiat Concern

Italy’s Fiat SpA and PSA Peugeot Citroen and Renault SA of France, which vie with the European units of GM and Ford, are among companies that say the U.S. bailout may make it tougher for them to compete. Christian Wulff, premier of the German state of Lower Saxony, where VW is based, has labeled the rescue plan “illegal” and VDA President Matthias Wissman has called for Europe to create a level playing field.

IHS’s Griffiths said Europe’s auto producers needn’t worry about missing out on aid.

“They’re going to get it,” he said. “The governments see that the carmakers are enormous parts of their economies. The big players are all national champions.”

The U.S. bailout may be justified to “avert a crisis of much greater magnitude” even if it does put Europe at a competitive disadvantage, the CDU’s Lippold said.

Shorter Hours

Daimler and Volkswagen, which have the biggest U.S. sales among European carmakers, have posted a combined profit of 25 billion euros since the end of 2004, while GM and Ford have lost $95 billion. Yet the deepening global recession has led even Europe’s leanest producers to fire workers or cut hours.

Daimler and BMW, which suffered a 25 percent plunge in November sales, have put employees on extended vacations to curb output of unwanted cars. Even VW, with a product lineup regarded as better suited to surviving the slowdown than luxury producers, has extended the Christmas break by five days.

Still, VW will emerge as a winner in the U.S., along with Toyota Motor Corp. of Japan, if it’s able to take an increased share of the regular market as GM struggles to reposition itself even with federal help, said Ferdinand Dudenhoeffer, director of the Center for Automotive Research at the University of Duisburg-Essen.

 

To contact the reporter on this story:

Chris Reiter in Berlin at creiter2@bloomberg.net