7/12/07 Goings On
Wal-Mart Stores Inc.'s June sales at stores open at least one year rose 2.4%, excluding fuel. Including fuel, same-store sales rose 2.5%. Total company sales for the five weeks ended July 6 rose 9.4% to $35.81 billion. The company expects same-store sales for the July four-week reporting period to be between 1% and 2%. The world's largest retailer forecast second-quarter profit to be within its previously stated target range of 75 cents to 79 cents a share. "We remain in a challenging environment, but still believe the earnings guidance for the quarter is attainable," Chief Financial Officer Tom Schoewe said in a statement.
Nordstrom's June same-store sales rose 2%, while its total sales rose 2.9% for the month. The firm said it expects to report second quarter same store sales rose 2% to 3%, and that July same-store sales will also be up 2% to 3%.
Macy's Inc.'s June sales at stores open at least one year fell 2.7%. Department-store operator Macy's expects same-store sales in July to be flat to down 3%. Based on sales levels that are lower than originally expected, the company now expects second quarter profit, excluding merger integration costs, to be in the range of 20 cents to 30 cents a share, compared to its previous guidance of 35 cents to 45 cents a share.
Rio Tinto agreed to offer $38.1 billion, or $101 a share in cash, for Canadian aluminum producer Alcan. Alcan will owe a break fee of $1.05 billion to Rio Tinto in certain circumstances. Sempra Metals estimates that the combined group would control 17.1 per cent of the world’s bauxite production, 11.6 per cent of alumina output and 11.6 of aluminium production.
South Korea's central bank boosted its benchmark lending rate by a quarter percentage point to 4.75% Thursday, marking its first rate hike in 11 months.
A Chinese government spokesman said tax authorities do not have a timetable for implementing a capital gains levy, according to reports. Li Linjun, a spokesman with the State Administration of Taxation, made the comments in program broadcast on state television late Wednesday, according to a report by Dow Jones Newswires.
The 10 members of the Organization of Petroleum Exporting Countries bound by the group's crude oil output agreements boosted production by 40,000 barrels per day to 26.6 million b/d in June, up from a revised May level of 26.56 million b/d, according to results from a Platts survey released late Wednesday. Total OPEC output, including volumes from Iraq and new member Angola, averaged 30.22 million b/d in June, up from a revised figure of 30.21 million b/d for May, Platts said. "Given what groups such as the International Energy Agency are saying is required for supply and demand to stay balanced in the second half of the year, consumers can't view this latest report as anything but discouraging," said John Kingston, Platts global director of oil, in a statement.
Micron Technology Inc., struggling with sharp price declines for its memory chips used in PCs and other electronics, has cut 5% of its global workforce, or 1,100 jobs.
Halliburton announced an increase to its buyback of $2B. Current repurchase allowance stands at $3B which at current prices would equate to about 9% of the outstanding shares.
Motorola said its cell phone division would not be profitable until 2008. Motorola said sales in the quarter ended June 30 will be between $8.6 billion and $8.7 billion, compared with its previous forecast that sales would be about $9.4 billion.
Genentech Inc. made $747 million, or 70 cents a share, in the second quarter, compared with $531 million, or 49 cents a share, in the same quarter last year. Excluding certain onetime items, the profit came in at 78 cents a share. Revenue rose to $3 billion from $2.2 billion. Genentech also said it now expects full-year 2007 earnings to range from $2.85 to $2.95 a share vs. a prior expectation of $2.79 to $2.90 a share.
Costco Wholesale Corp reported a 6 percent rise in June sales at stores open at least a year, helped by increased sales of televisions, small appliances and other items.
Joe Duarte: " According to Debka, Iran is so certain that a U.S. attack is coming that it has begun to ration gasoline, while Syria is telling its citizens to leave Lebanon. Meanwhile "Israel, Syria and Hizballah have prepared their armies for a war contingency entailing a possible clash on Golan and the Lebanese-Israeli frontier regions."
Nouriel Roubini: "If consumption spending were to remain weak in H2 – say close to the 1.5% growth of Q2 – the recovery of capex and inventories would not continue as weakness in the private final demand for consumption goods would lead to a further accumulation of unsold goods and a need to cut back on inventories, production and capital spending. Note also that the significant weakening of consumption in Q2 is confirmed by latest weekly reports on same chain store sales. The International Council of Shopping Centers and UBS are projecting that June's sales at stores open longer than a year will rise a mediocre 1.5% to 2%, year over year; this means that they have fallen in real terms over the last year."
Chicago Tribune: " The Ricketts family is the latest in a growing list of bidders for the Cubs. Tribune Co., which owns the Chicago Tribune, Los Angeles Times, WGN-Ch. 9 and other media assets, put the team up for sale in April to help fund an $8.2 billion effort to take itself private in partnership with Chicago billionaire Sam Zell. The hype has been building ever since. An investment banker representing another potential buyer said his sources at Major League Baseball are hearing prices for the Cubs, Wrigley Field and Tribune's quarter share of cable channel Comcast SportsNet of well more than $1 billion.
"The price is going to be eye-popping," he said. I believe the takeover of Tribune will be completed at $34 in cash, and the present discount of $4 represents an outstanding opportunity.
US petrol consumption rose last week to 9.7m barrels a day, the third highest reading ever and the highest for 2007, according to Lehman Brothers data.
Copper prices are approaching $8,000 a ton. Soybeans are $9+ and wheat $6+. How would Bernanke describe that inflation perception? Perceive this! The S&P Goldman Sachs Commodity Index is trading at 509+.
The May trade gap for the U.S. totaled $60 billion. It widened 2.3 percent from a revised deficit of $58.7 billion for April, the U.S. Commerce Department said. The trade deficit, which hit a record $758.5 billion in 2006, totaled $295.5 billion for the first five months of 2007, narrowing from $317.8 billion in the same period last year. With crude prices nearing record levels, the trade deficit will widen in my view.
Apparel retailer Gap Inc. said on Thursday its sales at stores open at least a year fell 5 percent in June, hurt by weakness at its Old Navy and namesake Gap chains.
Washington Post's Bob Woodward writing of a Nov. 13, 2006 briefing at the White House: " CIA Director Michael V. Hayden said "the inability of the government to govern seems irreversible," adding that he could not "point to any milestone or checkpoint where we can turn this thing around," according to written records of his briefing and the recollections of six participants. "The government is unable to govern," Hayden concluded. "We have spent a lot of energy and treasure creating a government that is balanced, and it cannot function." Later in the interview, he qualified the statement somewhat: "A government that can govern, sustain and defend itself is not achievable," he said, "in the short term."
For the Apple bulls I suggest you read this: http://www.footnoted.org/blog-notes/giving-up-on-the-iphone/
Chevron cut its Erskine field oil production in the North Sea.
So-called margin debt, a broad measure of leverage, jumped 11% to $353 billion at NYSE in May, up from nearly $318 billion in April.
The number of U.S. properties in foreclosure climbed 87 percent last month from a year earlier as home prices fell and lending standards tightened, making it harder for borrowers to sell homes and refinance mortgages. There were 164,644 loan default notices, scheduled auctions and bank repossessions in June, led by filings in California, Florida, Ohio and Michigan that together accounted for half the total, according to RealtyTrac, a seller of foreclosure data. The June foreclosure figure was 7 percent lower than that in May.
Bloomberg reported U.K. natural gas rose as forecasts indicated supplies of the fuel will probably decline today. Gas for delivery intraday gained as much as 3.6 percent to 31.7 pence a therm, according to prices on Bloomberg from broker ICAP Plc. It traded at 31 pence at 12:15 p.m. in London. That's equivalent to $6.4 million British thermal units. A therm is 100,000 Btus. Gas prices have increased this week after a ship damaged a pipeline owned by BP Plc, preventing some North Sea gas from reaching the market. Imports from Norway via the Langeled pipeline have also dropped. Traders owning capacity in the pipe may have been buying supplies in the U.K.
Huntsman Corp. agreed to be bought for $28 a share in cash, or $10.6 billion, by Hexion Specialty Chemicals Inc., a unit of private equity firm Apollo Group.
Eldorado Gold Corp. said on Thursday that it was ordered to shut its Kisladag gold mine in western Turkey in a court decision registered on Wednesday. Shares in the junior miner plummeted to a nine-month low after the announcement. The stock bottomed at C$4.55 on the Toronto Stock Exchange, down C$2.67, or 37 percent. It then regained some ground to C$5.10 in Toronto and $4.88 on Amex, a 29 percent drop. The order will stand until the court rules on an appeal of a lower court decision, which confirmed the legality of Eldorado's environmental impact assessment. The Vancouver, British Columbia-based company did not say who filed the appeal. Eldorado said the open pit mine in Turkey's Usak province will be closed in about 30 days. The company is uncertain how long it will take the court to review the appeal, but expects the appeal will be denied and the mine closure temporary.
In 2006 I had suggested one consider the purchase of EGO shares at the $4.60 level. One would have been rewarded with a 50% profit and little risk. I think this Turkey situation will sort itself out and owners of EGO shares at these levels will be rewarded once again.
Kisladag began commercial production in July, 2006 and produced 70,895 ounces of gold that year. Eldorado had previously forecast 2007 production between 190,000 ounces and 200,000 ounces of gold.
Natural-gas inventories rose by 106 billion cubic feet for the week ended July 6, the Energy Department said Thursday.Total stocks now stand at 2.627 trillion cubic feet, down 64 billion cubic feet from the year-ago level, but 374 billion cubic feet above the five-year average, the government data said. August natural gas was down 19 cents, or 2.9%, at $6.41 per million British thermal units.
The Labor Department said the number of U.S. workers applying for jobless benefits fell 12,000 to a seasonally adjusted 308,000 last week from an upwardly revised 320,000 the prior week. The four-week moving average slipped to 317,750 from 319,250.
Jose Lopez of Nestle Lopez said the group would work to cut some product lines that appear less profitable in the light of higher commodity prices, but none of the 27 blockbuster brands that generate over 1 billion Swiss francs in sales. He declined to elaborate. Nestle's efficiency drive under Chief Executive Peter Brabeck has seen the group grow organically by 5.8% a year and increase its gross margin by 300 basis points to 13.5% over the 10 years to 2006, helping it deliver industry beating improvements, according to a recent study by investment bank Dresdner Kleinwort.
Mexico's peso rose as the price of crude oil, the country's biggest export, surged. Mexico's peso rose 0.2 percent to 10.7850 per dollar at 10:42 a.m. New York time, after gaining 0.4 percent yesterday.
The market cap for ExxonMobil is $500B+ and for GE it's $400B+
August crude closed at $72.50 a barrel Thursday, down 6 cents for the session. August natural gas fell 10.3 cents to close at $6.497 per million British thermal units.
August gold climbed $6.20 to close at $668.30 an ounce Thursday in New York. September silver gained 20.5 cents, or 1.6%, to close at $13.18 an ounce, but September copper fell 1.1%, or 4.05 cents, to end at $3.581 a pound.
The Dow Jones Industrial Average surged more than 280 points, or 2.1%, closing at a new all-time record high. The blue chip index posted the biggest one-day point-gain for the blue chip index since October 2002. The S&P 500 and the Nasdaq Composite both closed with gains of 1.9%.
Alcoa Inc. withdrew its $28 billion offer to buy Canadian aluminum rival Alcan Inc. on Thursday after being outbid by mining giant Rio Tinto.
Thursday, July 12, 2007
Wednesday, July 11, 2007
M&A Activity
7/12/07 M&A Activity
New Brunswick Scientific Co. and German laboratory-equipment provider Eppendorf Group said Wednesday they have agreed to a merger agreement in which Eppendorf will acquire New Brunswick Scientific for $11.50 a share.
Shares of Unilever advanced 2% in London trading as published reports citing unnamed traders linked the Anglo-Dutch consumer products giant to a possible takeover bid from Colgate Palmolive.
Liz Claiborne Inc.is putting 16 of its brands under strategic review, set a strategic realignment, and plans to cut 7% to 9% of its non-retail growth force, as part of a major corporate overhaul announced ahead of an analyst meeting on Wednesday. The company, whose brands include Juicy Couture, Lucky Brand, Mexx, and Sigrid Olsen, tightened its 2007 adjusted earnings per share target to a range of $1.90 to $2.00, with adjusted net sales expected to be flat to down low single digits compared to last year.
The U.S. dollar index is trading at $80.50. The Federal Reserve's broad dollar index on Tuesday showed the greenback's nominal, weighted value at its lowest level in a decade. Against a selection of major currencies, the dollar hit its lowest level ever in the free-floating currency period since the Fed's records began in 1973. "We continue to see two themes play out: the dollar taking the brunt of concerns about credit markets, and whether this should lead to more substantial risk aversion and unwind of carry positions," said Laura Ambroseno, currency strategist at Morgan Stanley in London.
India's Megasoft has agreed to buy Boston Communications for $65 million, or $3.60 a share.
Alcan has begun negotiating a merger agreement with Rio Tinto as it seeks to fend off a hostile bid from Alcoa, The Globe and Mail newspaper reported Wednesday, citing unnamed sources.
Gerdau Ameristeel Corp. agreed to buy Chaparral Steel Co. for $4.22 billion, or $86 a share.
Ministry of Commerce spokesman Wang Xinpei said Wednesday growth in China's trade surplus could slow in the second half, according to Dow Jones Newswires. China's foreign exchange reserves, the world's largest, swelled to $1.33 trillion by the end of the first half on the back of massive trade flows that contributed to an acceleration in money supply growth in June. The central bank said on Wednesday that reserves had grown by $266.3 billion to $1.3326 trillion between January and June, in excess of the $247.3 billion reserves accumulation for the whole of 2006.
Ryland Group Inc. expects to report a second-quarter loss of $1.25 to $1.35 a share. The Calabasas, Calif.-based homebuilder said that due to "continued deterioration in the housing market," it expects to incur $145 million to $155 million in pre-tax charges related to inventory impairments and write-offs in the quarter. The impairments are associated with assets in Arizona, California, Florida and Nevada. Excluding inventory impairments and write-offs, Ryland said it expects to a post second-quarter profit of 75 cents to 80 cents a share. In addition, the company said preliminary sales for the second quarter were 2,521 units, down 16.6% from last year, and cancellations were roughly 34% of gross orders, versus 35.9% a year ago. Preliminary closings in the period totaled 2,461 units, down 35.3% from 2006.
Ventana Medical Systems Inc. said its board has rejected an unsolicited $75 a share cash tender offer from Swiss drug maker Roche Holding AG as "inadequate in multiple respects.
The cancer diagnostics company said that with the assistance of its financial and legal advisers, it determined the offer by the Swiss health-care company is against the best interest of stockholders. Ventana urged holders not to tender their shares to Roche and said it intends to "vigorously resist" Roche's attempt to acquire it at the current offer price.
Australia is undergoing one of its worst-ever droughts amid predictions that global warming could make things worse.
Brad Setser: "We now know that the BRIe economies -- Brazil, Russia and India -- added $200b to their reserves in the first half of the year. Close to $199b to be exact. Russia accounted for $102b of the increase, Brazil chipped in $61.5 and India added another $36b. A tiny bit of that was valuation gains; most of it was real. $200b -- $400b annualized -- is a phenomenal sum...UPDATE: China justed released its q2 reserves data. The PBoC banked $130.6b in q2, putting Chinese reserve growth for the first half of the year at $266b. That puts total BRIC reserve growth for the first half above $450b ($900b, annualized)."
Edward E. Leamer, director of the Anderson Forecast at UCLA, said housing markets are probably weaker than statistics suggest because more homeowners would like to sell but have decided to wait out the slump.
"Builders have made price concessions, but even at that they still haven't cleared out their inventories," Leamer said. "We keep looking for some blue sky, some sign that the market is improving, but we just don't see anything out there."
The Popular Revolutionary Army (EPR) said it had attacked oil installations of the state-owned oil company, Pemex. A gas pipeline in central Mexico suffered an explosion and fire in the early morning hours Tuesday, prompting evacuations of nearby communities but causing no injuries.
Nigerian oil company Moni Pulo is expected to shut-in its production following an attack by militants on an oil production barge in the Calabar River in the Niger Delta, a trader of West African crude said Tuesday.
China’s central bank may raise interest rates twice more this year, with the first coming as soon as this month, according to a Bank of China research report.
Investor confidence in the ability of companies to repay debt used to finance leveraged buyouts fell to the lowest in at least nine months in Europe as lenders shun risky assets.The iTraxx LevX Index of credit-default swaps on loans to 35 European companies owned by buyout firms from Blackstone Group LP in New York to London-based Apax Partners Worldwide LLC fell to 97.75, the lowest since the index started last October, according to data compiled by Bloomberg. The LevX reached a high of 101.53 in February and traded at 98.76 yesterday.
The Oil Drum: "The Kuwaiti government will discuss the size of the country's oil reserves in a closed-door session with members of parliament today. The size of the reserves in the world's seventh-largest oil exporter became a sensitive issue last year when industry newsletter Petroleum Intelligence Weekly (PIW) said it had seen internal records showing reserves were about 48 billion barrels - half the officially stated 99 billon.The difference is equal to more than four percent of global proved oil reserves, according to data in BP's annual statistical review, the oil industry's most trusted."
Paul Kasriel: "Each month the Bureau of Labor Statistics attempts to estimate how many jobs were created (or eliminated) by smaller businesses not yet included in its survey of employers. This estimate is referred to as the "birth/death" adjustment. In the 12 months ended June, total-not-seasonally-adjusted nonfarm payrolls increased by 1.982 million. During the same interval, the birth/death adjustment contributed 1.111 million jobs to the total. That is, in the 12 months ended June, the birth/death adjustment accounted for 56.0% of the 12-month increase in total nonfarm payrolls...In the 12 months ended March 2006, the birth/death adjustment was contributing only 30.9% of the jobs to the change in nonfarm payrolls. The birth/death relative contribution has been trending higher since then. Notice that as the birth/death contribution to nonfarm payrolls has been trending higher, the percentage of small businesses saying that now is a good time to expand their operations has been trending lower. If existing small business managers do not think now is a good time to expand their operations, does it make sense that there are a lot of new small businesses starting up and hiring?"
The American Petroleum Institute reported a decline of 6.8 million barrels in crude supplies for the week ending July 6. The Energy Department had reported a fall of 1.4 million barrels for the latest week. Motor gasoline supplies rose by 2.9 million barrels, the API said. The government reported that supplies were up 1.2 million barrels. Distillate supplies climbed 1.5 million barrels, the API said. The government posted a rise of 0.8-million barrels. Refinery activity improved to 90.2% from 90.0% in the previous week.
The National Association of Realtors also said it expects existing-home sales to rise to nearly 6.4 million in 2008, up from the 2007 estimate of more than 6.1 million. Nearly 6.5 million existing homes were sold in 2006, the trade group said. As for new homes, sales are projected at 865,000 in 2007 and 878,000 next year, but the 2008 projection would still be down more than 20% compared with the nearly 1.1 million new homes sold in 2006.
Sallie Mae, formally known as SLM Corp, said Wednesday the group that has agreed to acquire the company said it believes that legislative proposals pending before Congress "could result in a failure of the conditions to the closing of the merger to be satisfied." Sallie Mae said it strongly disagrees with the assertion, and plans to proceed towards the closing of the merger transaction as rapidly as possible. In April, the student-loan firm agreed to be taken private by a group comprised of private-equity firms J.C. Flowers & Co. and Friedman Fleischer & Lowe LLC, as well as J.P. Morgan and Bank of America, for $60 a share, or about $25 billion.
August gold fell $2.30 to close at $662.10 an ounce Wednesday. September silver closed unchanged at $12.975 an ounce. September copper gained 1.15 cents to close at $3.6215 a pound.
The former White House political director, testifying for the first time about the firings of eight U.S. attorneys, declined today to answer most questions about her role in the controversy, which threatens the job of Atty. Gen. Alberto Gonzales. Sara Taylor, 32, who left the White House staff seven weeks ago, had shown the Senate Judiciary Committee a letter from White House Counsel Fred F. Fielding advising her to avoid answering questions about internal White House deliberations on grounds of executive privilege.
Reformulated gasoline's August contract lost 6.31 cents, or 2.7%, to close at $2.3063 a gallon. August crude fell by 25 cents to close at $72.56 a barrel. August natural gas lost 9.9 cents to finish at $6.60 per million British thermal units.
New Brunswick Scientific Co. and German laboratory-equipment provider Eppendorf Group said Wednesday they have agreed to a merger agreement in which Eppendorf will acquire New Brunswick Scientific for $11.50 a share.
Shares of Unilever advanced 2% in London trading as published reports citing unnamed traders linked the Anglo-Dutch consumer products giant to a possible takeover bid from Colgate Palmolive.
Liz Claiborne Inc.is putting 16 of its brands under strategic review, set a strategic realignment, and plans to cut 7% to 9% of its non-retail growth force, as part of a major corporate overhaul announced ahead of an analyst meeting on Wednesday. The company, whose brands include Juicy Couture, Lucky Brand, Mexx, and Sigrid Olsen, tightened its 2007 adjusted earnings per share target to a range of $1.90 to $2.00, with adjusted net sales expected to be flat to down low single digits compared to last year.
The U.S. dollar index is trading at $80.50. The Federal Reserve's broad dollar index on Tuesday showed the greenback's nominal, weighted value at its lowest level in a decade. Against a selection of major currencies, the dollar hit its lowest level ever in the free-floating currency period since the Fed's records began in 1973. "We continue to see two themes play out: the dollar taking the brunt of concerns about credit markets, and whether this should lead to more substantial risk aversion and unwind of carry positions," said Laura Ambroseno, currency strategist at Morgan Stanley in London.
India's Megasoft has agreed to buy Boston Communications for $65 million, or $3.60 a share.
Alcan has begun negotiating a merger agreement with Rio Tinto as it seeks to fend off a hostile bid from Alcoa, The Globe and Mail newspaper reported Wednesday, citing unnamed sources.
Gerdau Ameristeel Corp. agreed to buy Chaparral Steel Co. for $4.22 billion, or $86 a share.
Ministry of Commerce spokesman Wang Xinpei said Wednesday growth in China's trade surplus could slow in the second half, according to Dow Jones Newswires. China's foreign exchange reserves, the world's largest, swelled to $1.33 trillion by the end of the first half on the back of massive trade flows that contributed to an acceleration in money supply growth in June. The central bank said on Wednesday that reserves had grown by $266.3 billion to $1.3326 trillion between January and June, in excess of the $247.3 billion reserves accumulation for the whole of 2006.
Ryland Group Inc. expects to report a second-quarter loss of $1.25 to $1.35 a share. The Calabasas, Calif.-based homebuilder said that due to "continued deterioration in the housing market," it expects to incur $145 million to $155 million in pre-tax charges related to inventory impairments and write-offs in the quarter. The impairments are associated with assets in Arizona, California, Florida and Nevada. Excluding inventory impairments and write-offs, Ryland said it expects to a post second-quarter profit of 75 cents to 80 cents a share. In addition, the company said preliminary sales for the second quarter were 2,521 units, down 16.6% from last year, and cancellations were roughly 34% of gross orders, versus 35.9% a year ago. Preliminary closings in the period totaled 2,461 units, down 35.3% from 2006.
Ventana Medical Systems Inc. said its board has rejected an unsolicited $75 a share cash tender offer from Swiss drug maker Roche Holding AG as "inadequate in multiple respects.
The cancer diagnostics company said that with the assistance of its financial and legal advisers, it determined the offer by the Swiss health-care company is against the best interest of stockholders. Ventana urged holders not to tender their shares to Roche and said it intends to "vigorously resist" Roche's attempt to acquire it at the current offer price.
Australia is undergoing one of its worst-ever droughts amid predictions that global warming could make things worse.
Brad Setser: "We now know that the BRIe economies -- Brazil, Russia and India -- added $200b to their reserves in the first half of the year. Close to $199b to be exact. Russia accounted for $102b of the increase, Brazil chipped in $61.5 and India added another $36b. A tiny bit of that was valuation gains; most of it was real. $200b -- $400b annualized -- is a phenomenal sum...UPDATE: China justed released its q2 reserves data. The PBoC banked $130.6b in q2, putting Chinese reserve growth for the first half of the year at $266b. That puts total BRIC reserve growth for the first half above $450b ($900b, annualized)."
Edward E. Leamer, director of the Anderson Forecast at UCLA, said housing markets are probably weaker than statistics suggest because more homeowners would like to sell but have decided to wait out the slump.
"Builders have made price concessions, but even at that they still haven't cleared out their inventories," Leamer said. "We keep looking for some blue sky, some sign that the market is improving, but we just don't see anything out there."
The Popular Revolutionary Army (EPR) said it had attacked oil installations of the state-owned oil company, Pemex. A gas pipeline in central Mexico suffered an explosion and fire in the early morning hours Tuesday, prompting evacuations of nearby communities but causing no injuries.
Nigerian oil company Moni Pulo is expected to shut-in its production following an attack by militants on an oil production barge in the Calabar River in the Niger Delta, a trader of West African crude said Tuesday.
China’s central bank may raise interest rates twice more this year, with the first coming as soon as this month, according to a Bank of China research report.
Investor confidence in the ability of companies to repay debt used to finance leveraged buyouts fell to the lowest in at least nine months in Europe as lenders shun risky assets.The iTraxx LevX Index of credit-default swaps on loans to 35 European companies owned by buyout firms from Blackstone Group LP in New York to London-based Apax Partners Worldwide LLC fell to 97.75, the lowest since the index started last October, according to data compiled by Bloomberg. The LevX reached a high of 101.53 in February and traded at 98.76 yesterday.
The Oil Drum: "The Kuwaiti government will discuss the size of the country's oil reserves in a closed-door session with members of parliament today. The size of the reserves in the world's seventh-largest oil exporter became a sensitive issue last year when industry newsletter Petroleum Intelligence Weekly (PIW) said it had seen internal records showing reserves were about 48 billion barrels - half the officially stated 99 billon.The difference is equal to more than four percent of global proved oil reserves, according to data in BP's annual statistical review, the oil industry's most trusted."
Paul Kasriel: "Each month the Bureau of Labor Statistics attempts to estimate how many jobs were created (or eliminated) by smaller businesses not yet included in its survey of employers. This estimate is referred to as the "birth/death" adjustment. In the 12 months ended June, total-not-seasonally-adjusted nonfarm payrolls increased by 1.982 million. During the same interval, the birth/death adjustment contributed 1.111 million jobs to the total. That is, in the 12 months ended June, the birth/death adjustment accounted for 56.0% of the 12-month increase in total nonfarm payrolls...In the 12 months ended March 2006, the birth/death adjustment was contributing only 30.9% of the jobs to the change in nonfarm payrolls. The birth/death relative contribution has been trending higher since then. Notice that as the birth/death contribution to nonfarm payrolls has been trending higher, the percentage of small businesses saying that now is a good time to expand their operations has been trending lower. If existing small business managers do not think now is a good time to expand their operations, does it make sense that there are a lot of new small businesses starting up and hiring?"
The American Petroleum Institute reported a decline of 6.8 million barrels in crude supplies for the week ending July 6. The Energy Department had reported a fall of 1.4 million barrels for the latest week. Motor gasoline supplies rose by 2.9 million barrels, the API said. The government reported that supplies were up 1.2 million barrels. Distillate supplies climbed 1.5 million barrels, the API said. The government posted a rise of 0.8-million barrels. Refinery activity improved to 90.2% from 90.0% in the previous week.
The National Association of Realtors also said it expects existing-home sales to rise to nearly 6.4 million in 2008, up from the 2007 estimate of more than 6.1 million. Nearly 6.5 million existing homes were sold in 2006, the trade group said. As for new homes, sales are projected at 865,000 in 2007 and 878,000 next year, but the 2008 projection would still be down more than 20% compared with the nearly 1.1 million new homes sold in 2006.
Sallie Mae, formally known as SLM Corp, said Wednesday the group that has agreed to acquire the company said it believes that legislative proposals pending before Congress "could result in a failure of the conditions to the closing of the merger to be satisfied." Sallie Mae said it strongly disagrees with the assertion, and plans to proceed towards the closing of the merger transaction as rapidly as possible. In April, the student-loan firm agreed to be taken private by a group comprised of private-equity firms J.C. Flowers & Co. and Friedman Fleischer & Lowe LLC, as well as J.P. Morgan and Bank of America, for $60 a share, or about $25 billion.
August gold fell $2.30 to close at $662.10 an ounce Wednesday. September silver closed unchanged at $12.975 an ounce. September copper gained 1.15 cents to close at $3.6215 a pound.
The former White House political director, testifying for the first time about the firings of eight U.S. attorneys, declined today to answer most questions about her role in the controversy, which threatens the job of Atty. Gen. Alberto Gonzales. Sara Taylor, 32, who left the White House staff seven weeks ago, had shown the Senate Judiciary Committee a letter from White House Counsel Fred F. Fielding advising her to avoid answering questions about internal White House deliberations on grounds of executive privilege.
Reformulated gasoline's August contract lost 6.31 cents, or 2.7%, to close at $2.3063 a gallon. August crude fell by 25 cents to close at $72.56 a barrel. August natural gas lost 9.9 cents to finish at $6.60 per million British thermal units.
Tuesday, July 10, 2007
Statistics
7/11/07 Statistics
Violence against US troops has escalated since the surge began in February. The daily military death toll has increased to an average of 3.5. The number of military deaths in Iraq and Afghanistan yesterday topped 4,000, said the Pentagon.
"Sales for the fiscal month of June were relatively sluggish, but finished a tad better than how they began," said Michael Niemira, chief economist for the ICSC. For the fiscal month, ICSC is targeting same-store sales growth in a range of about 1.5% to 2%.
Sears said that if the sales trends experienced during the first nine weeks of the second quarter continue through the rest of the second quarter period, which ends Aug. 4, net income will be between $1.06 and $1.32 a share. The current year second quarter estimate includes a gain of about 8 cents a share from bankruptcy-related settlements and total return swap investing activities. Analysts, on average, expected it to earn $2.12 for the fiscal second quarter, according to Thomson Financial.
D.R. Horton's orders for the third quarter ending June 30 dropped 40% to 8,559 homes, or down 47% to $2 billion by value. The cancellation rate at the Fort Worth, Tex.-based builder was 38%. "Market conditions for new home sales declined in our June quarter as inventory levels of both new and existing homes remained high, and we expect the housing environment to remain challenging," said Chairman Donald R. Horton in a statement. It expects a profit before impairments, but a loss after including those impairments, during the June quarter.
Home Depot lowered its earnings goal for the fiscal year, citing weaker conditions in the housing market. It had predicted fiscal year earnings to fall 15% excluding the sale of the HD Supply business; it now sees adjusted earnings per share dropping between 15% and 18%. Total retail sales will fall between 1% and 2% and comparable store sales will fall in the mid single digits. Its operating margin will fall by between 1.2 and 1.5 percentage points. Separately it said it's launching its tender offer for 250 million shares at a price between $39 and $44 a share.
BHP Billiton is talking to private equity firms over a potential $40 billion takeover bid for Alcoa Inc. according to a report in the Times (of London) newspaper. The report said BHP's favored partner is Blackstone group. The miner has hired Merrill Lynch to investigate bids for both Alcoa and Alcan, with Alcoa seen as the preferable target, the newspaper said.
China's trade surplus rose to $26.91 billion in June, setting a new monthly record. The June data brings China's trade surplus for the first six months of the year to $112.5 billion. Goldman Sachs estimated that the Chinese export surplus in the first half of the year equaled about 8 percent of its gross domestic product in the same period. Its surplus in the first half of 2006 equaled 6.3 percent of gross domestic product.
Alcoa, Inc. expects Chinese aluminum demand to increase 33.6% this year to 11.7 million metric tons, up from an April projection of 23.1%.
The Microsoft Press Conference due this Tuesday at E3 Media & Business Summit will be the platform for a price cut announcement according to Wedbush Morgan Securities analyst Michael Pachter.
In a note to investors today he stated that the Xbox 360 price cut will be across the entire range of consoles. In US dollars, the $299 Core pack will drop to $249; the $399 Premium pack will drop to $349; and the recently released $479 Elite model will drop to $399.
A report citing a lack of progress by the Baghdad government is only ''a look at the starting line'' of the U.S. troop surge and shouldn't be used by critics to demand withdrawal, President Bush's spokesman said Tuesday.
Bloomberg reported that Cedar Fair LP, the third-largest US theme-park operator, hired Bear Stearns to seek a buyer that will agree to keep the management team.
“There’s massive inflation in copper and nickel and stainless steel and concrete,” said John Krenecki, president and chief executive of GE Energy. The uncertainty is not just in nuclear plants, he said; coal plant prices are now similarly unstable. As talk of building new power plants rises sharply, so does the cost. A new fleet of coal-fired power plants and a revival of nuclear construction after three decades are both looking tougher lately.
Robert McHugh: "Short term, the Dow Industrials are approaching an Intermediate term top. However, there is evidence that suggests more upside is likely over the next few weeks, leading to that top. The below pattern in the Dow Industrials is an Ascending Expanding Wedge, with diverging upper and lower boundaries, which suggests a top here of significance. Once complete, prices can be expected to drop to about the start of the pattern, at a minimum, meaning into the 9,000s over the intermediate-term, although if the PPT responds by hyperinflating the money supply, it could be 9,000 in real dollars (gold adjusted), not nominal. A confirmed Hindenburg Omen remains on the clock until October, 2007."
Peter Schiff: "The Japanese are pursuing this reckless monetary policy with the deliberate goal of creating inflation, and they are in danger of succeeding beyond their wildest dreams. Despite the tendency of central bankers to argue that consumers are better served by rising prices rather than falling prices, "deflation" was never a real threat to Japan. On the contrary, falling consumer prices are one of the natural rewards that people enjoy in market economies. The fact that this benefit has been denied to most people in modern times as a result of government created inflation is one of the great tragedies of our time. To spare its citizens from suffering the "scourge" of being able to buy products at lower prices, the Japanese are close to destroying one of the greatest savings hordes in history. The question is why are they doing it? The only logical answer I can offer is that the Japanese realize that if they stop the flow of global liquidity they will destroy the dollar and the U.S. economy. To survive, the U.S. must be able to both limitlessly exchange the dollars it prints for the goods the rest of the world makes and then pay low rates of interest on its IOU's that foreigners accumulate as a result. Were the Japanese to turn off the monetary spigot and raise interest rates to normal levels, Americans would not be able to do either."
Gemstar-TV Guide to explore options to maximize shareholder value including sale of the company.
Daily shipments of North Sea Brent crude, part of the price benchmark for almost two-thirds of the world's oil, will increase 16 percent next month. Tankers are set to load 209,613 barrels a day of Brent crude in August, from 180,645 in July, according to the loading program of field operator Royal Dutch Shell Plc, Europe's largest oil company.
The Bank of Canada announced it would raise interest rates by a quarter point to 4.5%.
Buenos Aires saw snow on Monday for the first time in 89 years.
Pepsi Bottling Group Inc. posted profit that rose more than analysts estimated and raised its earnings forecast on European gains and increased demand for Lipton tea.
The euro hit a new high Tuesday against the dollar, topping $1.3708 in mid-morning trading.
August natural gas rose 28.9 cents to close at $6.699 per million British thermal units Tuesday as a heat wave in the Northeast and Western U.S. raised demand expectations. August crude rose 62 cents to close at $72.81 a barrel.
August gold climbed $1.90 to close at $664.40 an ounce.
Stillwater Mining Co. said Tuesday union employees at its Stillwater Mine and Columbus processing facilities, represented by the USW International Union Local 11-0001, failed to ratify a new labor agreement reached on July 2. The union has called for a strike to begin tomorrow, Billings, Mont.-based Stillwater said.
Alcoa signed for a $30 billion credit facility with its lenders that it would use to pay for Alcan shares. The banks includes Citigroup Inc. and Goldman Sachs Group Inc. as joint lead arrangers and joint book-running managers. The maturity date for the credit facility is January 10, 2009.
The dollar fell to a 26-year low against sterling, and slumped nearly 1% against the yen. Gregory Salvaggio, a vice president for trading at Tempus Consulting in Washington, said "the ECB is going to hike rates at least two times more this year and U.S. bond yields are falling, giving no incentive for large global investors to hold dollars." There's more than just interest rate differentials at play here. How about risk? How will the U.S. repay its debts owed to other countries? By printing more dollar-denominated debt with the dollar continuing to lose purchasing power. There's a big hole in this ponzi scheme, and it won't get fixed any time soon.
The brilliant quote of the day: "Forecasts of core inflation must take into account the extent to which food and energy costs are passed through to other prices," Bernanke said. A NYC cab driver could tell you that, and in multiple languages.
Bill Bonner: "When you need to make a monthly mortgage payment, there is not much fantasy or romance to it. It is real. When you don't have the money, it is even more real…which is to say, the experience is more intense and more memorable."
Violence against US troops has escalated since the surge began in February. The daily military death toll has increased to an average of 3.5. The number of military deaths in Iraq and Afghanistan yesterday topped 4,000, said the Pentagon.
"Sales for the fiscal month of June were relatively sluggish, but finished a tad better than how they began," said Michael Niemira, chief economist for the ICSC. For the fiscal month, ICSC is targeting same-store sales growth in a range of about 1.5% to 2%.
Sears said that if the sales trends experienced during the first nine weeks of the second quarter continue through the rest of the second quarter period, which ends Aug. 4, net income will be between $1.06 and $1.32 a share. The current year second quarter estimate includes a gain of about 8 cents a share from bankruptcy-related settlements and total return swap investing activities. Analysts, on average, expected it to earn $2.12 for the fiscal second quarter, according to Thomson Financial.
D.R. Horton's orders for the third quarter ending June 30 dropped 40% to 8,559 homes, or down 47% to $2 billion by value. The cancellation rate at the Fort Worth, Tex.-based builder was 38%. "Market conditions for new home sales declined in our June quarter as inventory levels of both new and existing homes remained high, and we expect the housing environment to remain challenging," said Chairman Donald R. Horton in a statement. It expects a profit before impairments, but a loss after including those impairments, during the June quarter.
Home Depot lowered its earnings goal for the fiscal year, citing weaker conditions in the housing market. It had predicted fiscal year earnings to fall 15% excluding the sale of the HD Supply business; it now sees adjusted earnings per share dropping between 15% and 18%. Total retail sales will fall between 1% and 2% and comparable store sales will fall in the mid single digits. Its operating margin will fall by between 1.2 and 1.5 percentage points. Separately it said it's launching its tender offer for 250 million shares at a price between $39 and $44 a share.
BHP Billiton is talking to private equity firms over a potential $40 billion takeover bid for Alcoa Inc. according to a report in the Times (of London) newspaper. The report said BHP's favored partner is Blackstone group. The miner has hired Merrill Lynch to investigate bids for both Alcoa and Alcan, with Alcoa seen as the preferable target, the newspaper said.
China's trade surplus rose to $26.91 billion in June, setting a new monthly record. The June data brings China's trade surplus for the first six months of the year to $112.5 billion. Goldman Sachs estimated that the Chinese export surplus in the first half of the year equaled about 8 percent of its gross domestic product in the same period. Its surplus in the first half of 2006 equaled 6.3 percent of gross domestic product.
Alcoa, Inc. expects Chinese aluminum demand to increase 33.6% this year to 11.7 million metric tons, up from an April projection of 23.1%.
The Microsoft Press Conference due this Tuesday at E3 Media & Business Summit will be the platform for a price cut announcement according to Wedbush Morgan Securities analyst Michael Pachter.
In a note to investors today he stated that the Xbox 360 price cut will be across the entire range of consoles. In US dollars, the $299 Core pack will drop to $249; the $399 Premium pack will drop to $349; and the recently released $479 Elite model will drop to $399.
A report citing a lack of progress by the Baghdad government is only ''a look at the starting line'' of the U.S. troop surge and shouldn't be used by critics to demand withdrawal, President Bush's spokesman said Tuesday.
Bloomberg reported that Cedar Fair LP, the third-largest US theme-park operator, hired Bear Stearns to seek a buyer that will agree to keep the management team.
“There’s massive inflation in copper and nickel and stainless steel and concrete,” said John Krenecki, president and chief executive of GE Energy. The uncertainty is not just in nuclear plants, he said; coal plant prices are now similarly unstable. As talk of building new power plants rises sharply, so does the cost. A new fleet of coal-fired power plants and a revival of nuclear construction after three decades are both looking tougher lately.
Robert McHugh: "Short term, the Dow Industrials are approaching an Intermediate term top. However, there is evidence that suggests more upside is likely over the next few weeks, leading to that top. The below pattern in the Dow Industrials is an Ascending Expanding Wedge, with diverging upper and lower boundaries, which suggests a top here of significance. Once complete, prices can be expected to drop to about the start of the pattern, at a minimum, meaning into the 9,000s over the intermediate-term, although if the PPT responds by hyperinflating the money supply, it could be 9,000 in real dollars (gold adjusted), not nominal. A confirmed Hindenburg Omen remains on the clock until October, 2007."
Peter Schiff: "The Japanese are pursuing this reckless monetary policy with the deliberate goal of creating inflation, and they are in danger of succeeding beyond their wildest dreams. Despite the tendency of central bankers to argue that consumers are better served by rising prices rather than falling prices, "deflation" was never a real threat to Japan. On the contrary, falling consumer prices are one of the natural rewards that people enjoy in market economies. The fact that this benefit has been denied to most people in modern times as a result of government created inflation is one of the great tragedies of our time. To spare its citizens from suffering the "scourge" of being able to buy products at lower prices, the Japanese are close to destroying one of the greatest savings hordes in history. The question is why are they doing it? The only logical answer I can offer is that the Japanese realize that if they stop the flow of global liquidity they will destroy the dollar and the U.S. economy. To survive, the U.S. must be able to both limitlessly exchange the dollars it prints for the goods the rest of the world makes and then pay low rates of interest on its IOU's that foreigners accumulate as a result. Were the Japanese to turn off the monetary spigot and raise interest rates to normal levels, Americans would not be able to do either."
Gemstar-TV Guide to explore options to maximize shareholder value including sale of the company.
Daily shipments of North Sea Brent crude, part of the price benchmark for almost two-thirds of the world's oil, will increase 16 percent next month. Tankers are set to load 209,613 barrels a day of Brent crude in August, from 180,645 in July, according to the loading program of field operator Royal Dutch Shell Plc, Europe's largest oil company.
The Bank of Canada announced it would raise interest rates by a quarter point to 4.5%.
Buenos Aires saw snow on Monday for the first time in 89 years.
Pepsi Bottling Group Inc. posted profit that rose more than analysts estimated and raised its earnings forecast on European gains and increased demand for Lipton tea.
The euro hit a new high Tuesday against the dollar, topping $1.3708 in mid-morning trading.
August natural gas rose 28.9 cents to close at $6.699 per million British thermal units Tuesday as a heat wave in the Northeast and Western U.S. raised demand expectations. August crude rose 62 cents to close at $72.81 a barrel.
August gold climbed $1.90 to close at $664.40 an ounce.
Stillwater Mining Co. said Tuesday union employees at its Stillwater Mine and Columbus processing facilities, represented by the USW International Union Local 11-0001, failed to ratify a new labor agreement reached on July 2. The union has called for a strike to begin tomorrow, Billings, Mont.-based Stillwater said.
Alcoa signed for a $30 billion credit facility with its lenders that it would use to pay for Alcan shares. The banks includes Citigroup Inc. and Goldman Sachs Group Inc. as joint lead arrangers and joint book-running managers. The maturity date for the credit facility is January 10, 2009.
The dollar fell to a 26-year low against sterling, and slumped nearly 1% against the yen. Gregory Salvaggio, a vice president for trading at Tempus Consulting in Washington, said "the ECB is going to hike rates at least two times more this year and U.S. bond yields are falling, giving no incentive for large global investors to hold dollars." There's more than just interest rate differentials at play here. How about risk? How will the U.S. repay its debts owed to other countries? By printing more dollar-denominated debt with the dollar continuing to lose purchasing power. There's a big hole in this ponzi scheme, and it won't get fixed any time soon.
The brilliant quote of the day: "Forecasts of core inflation must take into account the extent to which food and energy costs are passed through to other prices," Bernanke said. A NYC cab driver could tell you that, and in multiple languages.
Bill Bonner: "When you need to make a monthly mortgage payment, there is not much fantasy or romance to it. It is real. When you don't have the money, it is even more real…which is to say, the experience is more intense and more memorable."
Monday, July 09, 2007
Possibilities
7/10/07 Possibilities
Melbourne newspaper "The Age" reported that Rio Tinto has done "a tremendous amount of work" on a potential Alcan bid. North American investment bank CIBC has been recruited by Rio Tinto, the mining giant, to help strike a potential agreed £14 billion takeover of Canada’s Alcan.
Iran is ready to sign a $7 billion tri-nation gas pipeline project with India and Pakistan when the two neighbours resolve differences over the transit fee for movement of the gas, a senior official was quoted on Sunday as saying. "After India and Pakistan reach an agreement on transit fee ... we will move toward signing a contract," Hojjatollah Ghanimifard, an international affairs director with the National Iranian Oil Company (NIOC), told the Sharq newspaper. The pipeline would initially carry 60 million cubic metres of gas daily to Pakistan and India, half for each country. Under the plan, the pipeline's capacity would be increased to 150 million cubic metres at a later date. Iran says it has completed 18 percent of the work for the pipeline, which will supply gas from its prolific South Pars field up to Iran-Pakistan border. Pakistan has yet to begin on a 1,000 km stretch of the pipeline to link Iran with India.
Dubai Mercantile Exchange Limited (DME) yesterday announced statistics for its first month of trading since its launch on June 1.
The exchange reported a total of 58,365 contracts traded during June, of which 39,571 were Oman Crude Oil Futures Contracts (OQ), 7,332 WTI-Oman Financial Spread Contracts (QW) and 11,462 Brent-Oman Financial Spread Contracts (QN). This exceptionally high number of contracts going for physical delivery has only been exceeded once, by Nymex's WTI benchmark in January 1995.
Sequa Corp. said Monday they have agreed to be bought by The Carlyle Group for $2.7 billion. Under the terms of the merger agreement, Carlyle will acquire all of the outstanding Class A and Class B shares of Sequa for $175.00 per share in cash, a premium of 54% to the closing prices of Sequa's Class A and Class B shares on July 6, the companies said.
Apollo Management raised its offer for U.S. chemical company Huntsman Corp. by 75 cents a share Sunday night to $28 a share, The Wall Street Journal Online reported on Monday.
In a dire forecast, the Paris-based International Energy Agency is warning of an impending crunch in the supply of oil and natural gas needed to power world economic growth in coming years. The IEA raised their yearly demand for crude to 2.2% through 2012 versus prior forecasts of just a 2% rise.
John Hussman: "In general, high stock valuations coupled with low interest rates (as we have now) have historically been symptomatic of a fully priced, overly optimistic market, with little margin for error."
Sony will knock $100 off the price of the PlayStation 3 in an effort to jump-start sluggish sales. The price drop, to $499 from $599, comes eight months after Sony started selling the console.
A group of investors led by private equity firm CVC Capital Partners said Monday it bid 1.5 billion euros ($2 billion) for chemicals distributor Univar with approval from Univar's boards.The bid of 53.50 euros ($72.76) per share represents a 37% premium over Univar's closing share price on Friday.
Japanese stocks rose to a seven-year high Monday, lifted by stronger-than-expected machinery orders. The Nikkei 225 index climbed 121.04 points, or 0.67 percent, on the Tokyo Stock Exchange, to 18,261.98 points, the index's highest close since May 2, 2000.
Google Inc. will pay $625 million in cash to buy Postini, a specialist in communications security. "With this transaction, we're reinforcing our commitment to delivering compelling hosted applications to businesses of all sizes. With the addition of Postini, our apps are not just simple and appealing to users -- they can also streamline the complex information security mandates within these organizations," Google CEO and Chairman Eric Schmidt said.
Coventry Health Care Inc. said Monday it'll pay $685 million in cash to buy Florida Health Plan Administrators, LLC, owner of Vista Healthplans.
Gov. Ed Rendell late Sunday ordered a range of state government services shut down and placed about a third of the state work force on indefinite unpaid furlough after frantic last-minute negotiations failed to break a budget stalemate.
A surge in credit-card debt in May pushed outstanding U.S. consumer debt up at a 6.4% annual rate, or $12.9 billion, to $2.44 trillion, the Federal Reserve reported Monday. Credit-card debts rose at a 9.8% annual rate in May, the most in six months after a revised 0.2% gain in April. The average interest rate on credit-card accounts rose to 13.46%, the highest in five years.
The weather is forecast to be very hot across the nation this week, and temperatures will be much above normal levels. With the heat, natural gas prices should begin to strengthen.
Lear Corp. said its board has approved an amendment to a merger agreement with American Real Estate Partners LP under which AREP would increase its offer price for Lear shares to $37.25 from $36.
U.K. natural gas increased after BP Plc said flows of the fuel through a pipeline it operates may be halted for weeks. Shippers indicated they may pump less gas into storage in response to the higher prices.
Gas for intraday delivery rose as much as 10 percent to 33 pence a therm, the highest since Jan. 2, according to prices on Bloomberg from the energy broker ICAP Plc. It traded at 31.5 pence a therm at 12:12 p.m. in London, equivalent to $6.35 per million British thermal units. A therm is 100,000 Btus. Gas for delivery tomorrow also traded at 31.5 pence a therm.
Katanga Mining Ltd. added 34 cents to C$23.60. Central African Mining & Exploration Co., a miner of copper in the Democratic Republic of the Congo, said it will make an all-stock bid for rival copper miner Katanga Mining that values the company at 773.1 million pounds ($1.56 billion). Central African, based in London, will offer 15 of its shares for each share of Toronto-based Katanga. It already owns 22 percent of Katanga, Central African said in a statement distributed by the Regulatory News Service.
BHP Billiton Ltd's incoming chief executive, Marius Kloppers, believes the stockmarket underestimates the potential of the group's assets, even though the world's largest diversified resources group's shares are continuing to trade at record highs, UBS said in a research note.
Copper rose to a two-month high in New York after union workers went on strike at a mine in Chile, the world's largest producer of the metal. The protest will cut output at Dona Ines de Collahuasi, Chile's third-largest copper mine, union treasurer Pedro Diaz said today in a telephone interview.
Crude for August delivery closed down 62 cents at $72.19 a barrel on the New York Mercantile Exchange. August reformulated gasoline rose 3.50 cents at $2.3446 a gallon. August heating oil edged down 0.23 cent to $2.0928 a gallon. August natural gas fell 3.40 cents to $6.410 per million British thermal units.
ConocoPhillips has approved a $15 billion share buyback program. The Houston-based oil company said the repurchase authorization includes $2 billion remaining under the $4 billion stock buyback plan announced in February.\
Gold for August delivery closed up $7.70 at $662.50 an ounce on the New York Mercantile Exchange. September silver closed up 6.30 cents at $12.820 an ounce, October platinum gained $6.90 at $1,318.0 an ounce and September palladium gained $2.15 at $371.10 an ounce. September copper closed up 3.50 cents at $3.6295 a pound.
Johnson & Johnson has approved a share repurchase program of up to $10 billion.
Groupe Danone plans to buy Dutch baby-food maker Numico for 55 euros a share, or 12.3 billion euros ($16.7 billion) in cash.
President Bush invoked executive privilege Monday to deny requests by Congress for testimony from two former aides about the firings of federal prosecutors. The White House, however, did offer again to make former counsel Harriet Miers and one-time political director Sara Taylor available for private, off-the-record interviews.
BP apparently shut a crude unit at its 410,000 barrel per day Whiting, Ind. refinery.
Alcoa reported second-quarter earnings of 81 cents a share including one-time charges, though its sales of $8.1 billion fell short of expectations. The company also said it has extended its buyout offer for rival Alcan to Aug. 10. Alcoa has received about 418,500 Alcan common shares so far.
Gold warehouse inventories fell by 64,095 troy ounces to stand at 7.16 million troy ounces as of late Friday, according to Nymex data. Silver supplies rose to 135.1 million troy ounces, up 331,975 troy ounces, while copper supplies were unchanged at 22,123 short tons.
Melbourne newspaper "The Age" reported that Rio Tinto has done "a tremendous amount of work" on a potential Alcan bid. North American investment bank CIBC has been recruited by Rio Tinto, the mining giant, to help strike a potential agreed £14 billion takeover of Canada’s Alcan.
Iran is ready to sign a $7 billion tri-nation gas pipeline project with India and Pakistan when the two neighbours resolve differences over the transit fee for movement of the gas, a senior official was quoted on Sunday as saying. "After India and Pakistan reach an agreement on transit fee ... we will move toward signing a contract," Hojjatollah Ghanimifard, an international affairs director with the National Iranian Oil Company (NIOC), told the Sharq newspaper. The pipeline would initially carry 60 million cubic metres of gas daily to Pakistan and India, half for each country. Under the plan, the pipeline's capacity would be increased to 150 million cubic metres at a later date. Iran says it has completed 18 percent of the work for the pipeline, which will supply gas from its prolific South Pars field up to Iran-Pakistan border. Pakistan has yet to begin on a 1,000 km stretch of the pipeline to link Iran with India.
Dubai Mercantile Exchange Limited (DME) yesterday announced statistics for its first month of trading since its launch on June 1.
The exchange reported a total of 58,365 contracts traded during June, of which 39,571 were Oman Crude Oil Futures Contracts (OQ), 7,332 WTI-Oman Financial Spread Contracts (QW) and 11,462 Brent-Oman Financial Spread Contracts (QN). This exceptionally high number of contracts going for physical delivery has only been exceeded once, by Nymex's WTI benchmark in January 1995.
Sequa Corp. said Monday they have agreed to be bought by The Carlyle Group for $2.7 billion. Under the terms of the merger agreement, Carlyle will acquire all of the outstanding Class A and Class B shares of Sequa for $175.00 per share in cash, a premium of 54% to the closing prices of Sequa's Class A and Class B shares on July 6, the companies said.
Apollo Management raised its offer for U.S. chemical company Huntsman Corp. by 75 cents a share Sunday night to $28 a share, The Wall Street Journal Online reported on Monday.
In a dire forecast, the Paris-based International Energy Agency is warning of an impending crunch in the supply of oil and natural gas needed to power world economic growth in coming years. The IEA raised their yearly demand for crude to 2.2% through 2012 versus prior forecasts of just a 2% rise.
John Hussman: "In general, high stock valuations coupled with low interest rates (as we have now) have historically been symptomatic of a fully priced, overly optimistic market, with little margin for error."
Sony will knock $100 off the price of the PlayStation 3 in an effort to jump-start sluggish sales. The price drop, to $499 from $599, comes eight months after Sony started selling the console.
A group of investors led by private equity firm CVC Capital Partners said Monday it bid 1.5 billion euros ($2 billion) for chemicals distributor Univar with approval from Univar's boards.The bid of 53.50 euros ($72.76) per share represents a 37% premium over Univar's closing share price on Friday.
Japanese stocks rose to a seven-year high Monday, lifted by stronger-than-expected machinery orders. The Nikkei 225 index climbed 121.04 points, or 0.67 percent, on the Tokyo Stock Exchange, to 18,261.98 points, the index's highest close since May 2, 2000.
Google Inc. will pay $625 million in cash to buy Postini, a specialist in communications security. "With this transaction, we're reinforcing our commitment to delivering compelling hosted applications to businesses of all sizes. With the addition of Postini, our apps are not just simple and appealing to users -- they can also streamline the complex information security mandates within these organizations," Google CEO and Chairman Eric Schmidt said.
Coventry Health Care Inc. said Monday it'll pay $685 million in cash to buy Florida Health Plan Administrators, LLC, owner of Vista Healthplans.
Gov. Ed Rendell late Sunday ordered a range of state government services shut down and placed about a third of the state work force on indefinite unpaid furlough after frantic last-minute negotiations failed to break a budget stalemate.
A surge in credit-card debt in May pushed outstanding U.S. consumer debt up at a 6.4% annual rate, or $12.9 billion, to $2.44 trillion, the Federal Reserve reported Monday. Credit-card debts rose at a 9.8% annual rate in May, the most in six months after a revised 0.2% gain in April. The average interest rate on credit-card accounts rose to 13.46%, the highest in five years.
The weather is forecast to be very hot across the nation this week, and temperatures will be much above normal levels. With the heat, natural gas prices should begin to strengthen.
Lear Corp. said its board has approved an amendment to a merger agreement with American Real Estate Partners LP under which AREP would increase its offer price for Lear shares to $37.25 from $36.
U.K. natural gas increased after BP Plc said flows of the fuel through a pipeline it operates may be halted for weeks. Shippers indicated they may pump less gas into storage in response to the higher prices.
Gas for intraday delivery rose as much as 10 percent to 33 pence a therm, the highest since Jan. 2, according to prices on Bloomberg from the energy broker ICAP Plc. It traded at 31.5 pence a therm at 12:12 p.m. in London, equivalent to $6.35 per million British thermal units. A therm is 100,000 Btus. Gas for delivery tomorrow also traded at 31.5 pence a therm.
Katanga Mining Ltd. added 34 cents to C$23.60. Central African Mining & Exploration Co., a miner of copper in the Democratic Republic of the Congo, said it will make an all-stock bid for rival copper miner Katanga Mining that values the company at 773.1 million pounds ($1.56 billion). Central African, based in London, will offer 15 of its shares for each share of Toronto-based Katanga. It already owns 22 percent of Katanga, Central African said in a statement distributed by the Regulatory News Service.
BHP Billiton Ltd's incoming chief executive, Marius Kloppers, believes the stockmarket underestimates the potential of the group's assets, even though the world's largest diversified resources group's shares are continuing to trade at record highs, UBS said in a research note.
Copper rose to a two-month high in New York after union workers went on strike at a mine in Chile, the world's largest producer of the metal. The protest will cut output at Dona Ines de Collahuasi, Chile's third-largest copper mine, union treasurer Pedro Diaz said today in a telephone interview.
Crude for August delivery closed down 62 cents at $72.19 a barrel on the New York Mercantile Exchange. August reformulated gasoline rose 3.50 cents at $2.3446 a gallon. August heating oil edged down 0.23 cent to $2.0928 a gallon. August natural gas fell 3.40 cents to $6.410 per million British thermal units.
ConocoPhillips has approved a $15 billion share buyback program. The Houston-based oil company said the repurchase authorization includes $2 billion remaining under the $4 billion stock buyback plan announced in February.\
Gold for August delivery closed up $7.70 at $662.50 an ounce on the New York Mercantile Exchange. September silver closed up 6.30 cents at $12.820 an ounce, October platinum gained $6.90 at $1,318.0 an ounce and September palladium gained $2.15 at $371.10 an ounce. September copper closed up 3.50 cents at $3.6295 a pound.
Johnson & Johnson has approved a share repurchase program of up to $10 billion.
Groupe Danone plans to buy Dutch baby-food maker Numico for 55 euros a share, or 12.3 billion euros ($16.7 billion) in cash.
President Bush invoked executive privilege Monday to deny requests by Congress for testimony from two former aides about the firings of federal prosecutors. The White House, however, did offer again to make former counsel Harriet Miers and one-time political director Sara Taylor available for private, off-the-record interviews.
BP apparently shut a crude unit at its 410,000 barrel per day Whiting, Ind. refinery.
Alcoa reported second-quarter earnings of 81 cents a share including one-time charges, though its sales of $8.1 billion fell short of expectations. The company also said it has extended its buyout offer for rival Alcan to Aug. 10. Alcoa has received about 418,500 Alcan common shares so far.
Gold warehouse inventories fell by 64,095 troy ounces to stand at 7.16 million troy ounces as of late Friday, according to Nymex data. Silver supplies rose to 135.1 million troy ounces, up 331,975 troy ounces, while copper supplies were unchanged at 22,123 short tons.
Sunday, July 08, 2007
The Heat Wave
7/9/07 The Heat Wave
In the latest indication that this will be a long, smoky summer, two lightning-sparked wildfires burned unchecked Saturday through 34,000 acres of the Inyo National Forest, forcing officials to shut down long stretches of U.S. Highway 395, the gateway to the Eastern Sierra Nevada.
At various times, portions of Highway 395 were closed between Bishop on the north and Pearsonville on the south — a 115-mile-long stretch of highway. Highway 395 is an essential thoroughfare to a list of destinations that reads like a California travel guide: Mammoth Lakes, Lake Tahoe, the John Muir Wilderness and Sequoia and Kings Canyon national parks.
An 8,000-acre wildfire forced hundreds of people in the town of Winnemucca to leave their homes, one of more than a dozen blazes that charred a combined 55 square miles in northern Nevada. The fire near Winnemucca, about 170 miles east of Reno, threatened up to eight blocks of homes and an electrical substation, said U.S. Bureau of Land Management spokesman Jamie Thompson.
A 100-mile stretch of Interstate 15 in central Utah was closed when a 160,000-acre wildfire jumped the highway, and other fires burned in California, Colorado, Arizona, Idaho, Oregon and Washington.
Courtesy of the Washington Post: "The security progress we're making is real," said a senior military intelligence official in Baghdad. "But it's only in part of the country, and there's not enough political progress to get us over the line in September." And more from the Washington Post: Senate and House committees have directed President Bush to provide by tomorrow a detailed justification of his executive privilege claims and a full accounting of the documents he is withholding. But White House counsel Fred F. Fielding plans to tell lawmakers that he has already provided the legal basis for the claims and will not provide a log of the documents, the sources said.
Russian Deputy Prime Minister Sergei Ivanov on Sunday spoke of the possibility of a new 'Berlin Wall' between Russia and Europe triggered by the stationing of US military technology in the Czech Republic and Poland.
BJ Tubular Services, a division of BJ Services, has won a well-services contract from Total E&P Borneo, for work in Brunei Darussalam. The contract covers a range of make-up services for three wells on Total's offshore development in Block B, roughly 50 kms north of the capital city of Bandar Seri Begawan.
With the recent Brunei contract award, BJ decided to open an operations base in Brunei that will be dedicated to supporting Total operations on Block B.
"It's extremely heartening to witness our relationship with Total expanding, not only in terms of their reliance on our full range of services, but geographically throughout the Asia-Pacific region," said Kenny Watt, division manager of BJ Tubular Services. "With the new dedicated BJ base in Brunei, I am confident we will be able to support this extensive operation for Total with even greater efficiency and responsiveness," he added.
Ten-year yields exceed two-year yields by 20 basis points, the most since June 26.
Mike Burk: "Next week includes the 5 trading days ahead of the 2nd Friday of July during the 3rd year of the Presidential Cycle...During the 3rd year of the Presidential Cycle the OTC has been up 64% of the time with an average gain of 1.15%, half of that gain has been made on Monday which has never been down. Over all years the OTC has also been up 64% of the time with about half the average gain of year 3. The SPX has been modestly positive over all periods...The market is overbought and the bull is getting a little tired, but, seasonally the week ahead has been pretty good. I expect the major indices to be higher on Friday July 13 than they were on Friday July 6."
Food prices will rise between 20-50% over the next decade, says a new report jointly published by the U.N. and the OECD.
Mitsubishi UFJ predicts an August rate hike to 0.75% for the Bank of Japan.
Houston Chronicle: "Much of Africa's estimated 5.5 percent economic growth last year was attributed to China's near-insatiable demand for the continent's oil, gas, timber, copper and other natural resources."
Lake Okeechobee, the heart of the Everglades and a backup drinking water source for millions of South Florida residents, has been hitting a record low almost weekly. Its main artery, the Kissimmee River starting near Orlando, hasn't flowed south in more than 240 days, depriving the lake of 50 percent of its water.
In the latest indication that this will be a long, smoky summer, two lightning-sparked wildfires burned unchecked Saturday through 34,000 acres of the Inyo National Forest, forcing officials to shut down long stretches of U.S. Highway 395, the gateway to the Eastern Sierra Nevada.
At various times, portions of Highway 395 were closed between Bishop on the north and Pearsonville on the south — a 115-mile-long stretch of highway. Highway 395 is an essential thoroughfare to a list of destinations that reads like a California travel guide: Mammoth Lakes, Lake Tahoe, the John Muir Wilderness and Sequoia and Kings Canyon national parks.
An 8,000-acre wildfire forced hundreds of people in the town of Winnemucca to leave their homes, one of more than a dozen blazes that charred a combined 55 square miles in northern Nevada. The fire near Winnemucca, about 170 miles east of Reno, threatened up to eight blocks of homes and an electrical substation, said U.S. Bureau of Land Management spokesman Jamie Thompson.
A 100-mile stretch of Interstate 15 in central Utah was closed when a 160,000-acre wildfire jumped the highway, and other fires burned in California, Colorado, Arizona, Idaho, Oregon and Washington.
Courtesy of the Washington Post: "The security progress we're making is real," said a senior military intelligence official in Baghdad. "But it's only in part of the country, and there's not enough political progress to get us over the line in September." And more from the Washington Post: Senate and House committees have directed President Bush to provide by tomorrow a detailed justification of his executive privilege claims and a full accounting of the documents he is withholding. But White House counsel Fred F. Fielding plans to tell lawmakers that he has already provided the legal basis for the claims and will not provide a log of the documents, the sources said.
Russian Deputy Prime Minister Sergei Ivanov on Sunday spoke of the possibility of a new 'Berlin Wall' between Russia and Europe triggered by the stationing of US military technology in the Czech Republic and Poland.
BJ Tubular Services, a division of BJ Services, has won a well-services contract from Total E&P Borneo, for work in Brunei Darussalam. The contract covers a range of make-up services for three wells on Total's offshore development in Block B, roughly 50 kms north of the capital city of Bandar Seri Begawan.
With the recent Brunei contract award, BJ decided to open an operations base in Brunei that will be dedicated to supporting Total operations on Block B.
"It's extremely heartening to witness our relationship with Total expanding, not only in terms of their reliance on our full range of services, but geographically throughout the Asia-Pacific region," said Kenny Watt, division manager of BJ Tubular Services. "With the new dedicated BJ base in Brunei, I am confident we will be able to support this extensive operation for Total with even greater efficiency and responsiveness," he added.
Ten-year yields exceed two-year yields by 20 basis points, the most since June 26.
Mike Burk: "Next week includes the 5 trading days ahead of the 2nd Friday of July during the 3rd year of the Presidential Cycle...During the 3rd year of the Presidential Cycle the OTC has been up 64% of the time with an average gain of 1.15%, half of that gain has been made on Monday which has never been down. Over all years the OTC has also been up 64% of the time with about half the average gain of year 3. The SPX has been modestly positive over all periods...The market is overbought and the bull is getting a little tired, but, seasonally the week ahead has been pretty good. I expect the major indices to be higher on Friday July 13 than they were on Friday July 6."
Food prices will rise between 20-50% over the next decade, says a new report jointly published by the U.N. and the OECD.
Mitsubishi UFJ predicts an August rate hike to 0.75% for the Bank of Japan.
Houston Chronicle: "Much of Africa's estimated 5.5 percent economic growth last year was attributed to China's near-insatiable demand for the continent's oil, gas, timber, copper and other natural resources."
Lake Okeechobee, the heart of the Everglades and a backup drinking water source for millions of South Florida residents, has been hitting a record low almost weekly. Its main artery, the Kissimmee River starting near Orlando, hasn't flowed south in more than 240 days, depriving the lake of 50 percent of its water.
Saturday, July 07, 2007
Trying To Define Risk
7/8/07 Trying To Define Risk
A high-pressure system brought temperatures of over 110 to parts of the Southwest, leading to hundreds of wildfires.
Jonathan Laing writes in Barron's that "losses on securities tied to subprime loans could top $100 billion."
On Tuesday, the Bank of Canada is expected to raise its key lending rate to 4.50%. The Canadian dollar climbed to a 30-year high against the U.S. currency Friday, bolstered by higher oil prices, a strong economy and a looming interest-rate increase.
Canada's currency advanced as high as 95.53 U.S. cents, pushing past the 95 cents mark for the first time since May 1977. It has risen 10.8 percent so far this year.
Meanwhile, the 10-year dollar swap spread increased 0.4 to a multi-year high 64.2. The dollar index declined 0.5% to 81.26.
Ian Shepherdson is the chief economist at High Frequency Economics in Valhalla, N.Y. He explains in Barron's "why a housing recovery is far off...The supply of unsold new homes is now almost double what it was in the 1998-2005 boom."
Brad Setser: "But the fact that both China and Russia save more than they invest and are net lenders -- not net borrowers -- from the rest of the world seems rather relevant. Both are, I suspect, growing tired of taking funds that foreign investors bring in looking for big -- 10, 15, or more -- returns and sending them back to the US where they get 5% in the Treasury and Agency market. That kind of swap may generate dark matter for the US, but it isn't obviously in the interest of the world's emerging economies. Of course, the fact that they cannot swap equity for equity, and use the funds brought in by private investors to the US to add to their state investment company's holdings of US equities may play a role as well."
“Russia’s money supply expanded 19% in the first quarter and will probably expand as much as 39% by the end of the year, central bank Chairman Sergei Ignatiev said.
In the first four months of the year, 23 estates selling for at least $10 million closed escrow in the Platinum Triangle of Beverly Hills, Bel-Air and Holmby Hills., according to records kept by local real estate agents, up from 10 last year.
By contrast, home sales in Los Angeles County fell 19.1% through May, according to research firm DataQuick Information Systems.
A Federal appeals court removes hurdle to White House's domestic spying program, ruling plaintiffs lacked standing to challenge its constitutionality.
The average national price of a gallon of gas inched up 0.3 cent to $2.952, according to AAA and the Oil Price Information Service. Retail prices, which typically lag futures, had fallen steadily since their late May peak of $3.227 a gallon.
Doug Noland: "There is today an unusually fine line between an unwieldy global liquidity Bubble and the mounting risk of a liquidity dislocation in the market for financing risky securities. Such uncertainty has become a distinguishing feature of the today’s Credit and speculation-induced Monetary Disorder.
The risks of a flight away from the CDO market are very real and won’t likely dissipate anytime soon. “Ponzi Finance” dynamics have created acute fragility. A run on these illiquid instruments would be immediately problematic, requiring re-pricing throughout. Since a large amount of these securities are financed through the Wall Street “repo” machine, lower prices would instigate margin calls and forced liquidation. The risk of a problematic deleveraging and marketplace dislocation is today quite high... I may believe we are on the precipice for one heck of a problem associated with the reversal of speculative flows to risky and illiquid debt instruments. But what this means in the near-term for the U.S. and global equities Game is anything but clear...Moreover, I see no reason why we should not expect today’s unfathomable derivatives markets to run amuck...today’s global Credit apparatus has extraordinary command over the liquidity-creation process. It’s just losing more and more control over inflationary effects in an asset manic world. Wall Street is immersed in a dangerous Game."
Henry To: "There are now signs of stress creeping up in the CMBS sector, in addition to the troubles that we have been witnessing in both the CDO and the CLO market. Moreover, within the subprime mortgage market, we are also now witnessing significant losses in the 2005 vintage as well, as opposed to only the riskier 2006 vintage. The years of excesses are now starting to come home to roost... Combined with the liquidity headwinds that we have previously discussed, stocks are definitely not too attractive at this point, especially as the Yen carry trade is now very stretched by any measure and as the world's major central banks are still in a tightening phase...Given that the market had been relentlessly rising since the mid June 2006 bottom, and given that it also quickly shrugged off the subprime troubles during late February to mid March, there is good reason to believe that many investors are ignoring clear road signs that liquidity is declining drastically - and that, at some point, it is going to have a significant impact on stock prices...the Swiss Franc carry trade is now estimated to be over $650 billion large - with most of the "carry traders" located in Eastern Europe. As a matter of fact, many of these "carry traders" are households and small businesses who have taken out mortgages or loans denominated in Swiss Francs...In the case of the liquidity-induced correction that I have been looking for over the next three to six months, the culprit is the tremendous increase in both the NYSE and the NASDAQ short interest over the last four months...the increase in NYSE short interest has been nothing short of dramatic over the last few months - an increase which could only be matched by the increase in short interest during the 2000 to 2002 bear market. As a matter of fact, the latest 12-month increase in short interest just hit a record high of 37.2%! This increase in short interest on the NYSE is also being confirmed by the increase and outstanding short interest on the NASDAQ Composite...the Achilles' Heel for the bearish scenario over the next few months is the abnormally high amount of short interest on both the NYSE and the NASDAQ Composite. Should the market fail to start correcting soon, then many short-sellers could start losing patience with their short positions and start covering - thus causing a tremendous short-covering rally."
John Mauldin: "Let's assume for a moment that the highest estimates of subprime mortgage defaults are correct. That would suggest losses of $250 billion. But these homes will not go to zero. Even if they drop by 40% for a total market loss of $100 billion, that is going to get absorbed by thousands of funds and investors. No one will be happy (except the lawyers), and a few banking institutions will end up being taken over as their balance sheets decline and make them vulnerable, but the mortgage losses will not directly put the system at risk. It will mean that home valuations are likely to drop more than most market forecasters are projecting, and thus cash-out financing is going to drop, but in the grand scheme of things that is not a severe blow to the overall economy. The one true risk that is simply not knowable at this point is in the Credit Default Swap (CDS) market. Basically, the CDS market allows an investor to pass on the risk as well as the returns of a loan or a basket of loans. It is a form of insurance. If you are a bank and need to clean up your balance sheet, you simply go to a CDS dealer and find someone who will take your risk for a price. A fund, trading desk, or bank can make a nice premium selling CDSs and show very steady returns, somewhat like selling naked options. The CDS market is huge, in the hundreds of trillions of dollars and growing dramatically. There is said to be about $1 trillion in CDSs for an underlying $20 billion in GM debt. There are institutions which both buy and sell CDSs, trading them for an arbitrage profit. As long as there is adequate collateral, there is no problem. The game can go on. And it is an important game. There is a reason this market has become so large so quickly. A CDS can be a very useful risk management tool. It is one of the reasons that the markets are so liquid. If there is a hiccup in this market, it could cause serious problems in a very short time. And the hiccup could be caused by a few institutions or funds not being able to honor their Credit Default Swaps. There is no agency overseeing counter-party risk. This is the one true systemic risk that I see. How probable a risk is it? Not very, but the problem if one developed would be so huge that it is worth paying attention to."
Exxon Mobil pumped just 3 percent of the world's oil last year. National oil companies, which control almost 90 percent of global oil reserves, produced the bulk of the world's supply.
There is more trade going on today between China and Africa than ever before. In the late 1980s, trade between the country and the continent was $12 million. Last year, according to official Chin-ese figures, it reached a record $55 billion. In 1991, Chinese direct investment in Africa was less than $5 million a year. In 2006 - China's official "Year of Africa" - it reached $1.25 billion, according to the Chinese Academy of Social Sciences. Last year, Angola overtook Saudi Arabia as the largest oil supplier to China, and Sudan - China's second-largest supplier on the continent - sold close to 65 per cent of its oil to Beijing. China is also either drilling or exploring for oil in more than half a dozen other African countries. China is extracting copper from Zambia and cobalt (a key ingredient in making cellphones and laptop computers) from Congo, buying timber in such countries as Cameroon and Liberia, and getting manganese for manufacturing steel from Ghana. South Africa is one of China's biggest suppliers of iron ore. With $55 billion in trade with Africa last year, China has quickly inched past France ($47 billion) to become the continent's second-largest bilateral trading partner, after the US ($91 billion), according to the International Monetary Fund. Martyn Davies, head of the Centre for China Studies at South Africa's Stellenbosch University, estimates that within five years, China will be the continent's top trading partner.
The American Research Group announced that in a recent poll, 54 percent of Americans favor impeaching Dick Cheney and 45 percent favor impeaching George W. Bush. The poll surveyed 1,100 people July 3-5.
A high-pressure system brought temperatures of over 110 to parts of the Southwest, leading to hundreds of wildfires.
Jonathan Laing writes in Barron's that "losses on securities tied to subprime loans could top $100 billion."
On Tuesday, the Bank of Canada is expected to raise its key lending rate to 4.50%. The Canadian dollar climbed to a 30-year high against the U.S. currency Friday, bolstered by higher oil prices, a strong economy and a looming interest-rate increase.
Canada's currency advanced as high as 95.53 U.S. cents, pushing past the 95 cents mark for the first time since May 1977. It has risen 10.8 percent so far this year.
Meanwhile, the 10-year dollar swap spread increased 0.4 to a multi-year high 64.2. The dollar index declined 0.5% to 81.26.
Ian Shepherdson is the chief economist at High Frequency Economics in Valhalla, N.Y. He explains in Barron's "why a housing recovery is far off...The supply of unsold new homes is now almost double what it was in the 1998-2005 boom."
Brad Setser: "But the fact that both China and Russia save more than they invest and are net lenders -- not net borrowers -- from the rest of the world seems rather relevant. Both are, I suspect, growing tired of taking funds that foreign investors bring in looking for big -- 10, 15, or more -- returns and sending them back to the US where they get 5% in the Treasury and Agency market. That kind of swap may generate dark matter for the US, but it isn't obviously in the interest of the world's emerging economies. Of course, the fact that they cannot swap equity for equity, and use the funds brought in by private investors to the US to add to their state investment company's holdings of US equities may play a role as well."
“Russia’s money supply expanded 19% in the first quarter and will probably expand as much as 39% by the end of the year, central bank Chairman Sergei Ignatiev said.
In the first four months of the year, 23 estates selling for at least $10 million closed escrow in the Platinum Triangle of Beverly Hills, Bel-Air and Holmby Hills., according to records kept by local real estate agents, up from 10 last year.
By contrast, home sales in Los Angeles County fell 19.1% through May, according to research firm DataQuick Information Systems.
A Federal appeals court removes hurdle to White House's domestic spying program, ruling plaintiffs lacked standing to challenge its constitutionality.
The average national price of a gallon of gas inched up 0.3 cent to $2.952, according to AAA and the Oil Price Information Service. Retail prices, which typically lag futures, had fallen steadily since their late May peak of $3.227 a gallon.
Doug Noland: "There is today an unusually fine line between an unwieldy global liquidity Bubble and the mounting risk of a liquidity dislocation in the market for financing risky securities. Such uncertainty has become a distinguishing feature of the today’s Credit and speculation-induced Monetary Disorder.
The risks of a flight away from the CDO market are very real and won’t likely dissipate anytime soon. “Ponzi Finance” dynamics have created acute fragility. A run on these illiquid instruments would be immediately problematic, requiring re-pricing throughout. Since a large amount of these securities are financed through the Wall Street “repo” machine, lower prices would instigate margin calls and forced liquidation. The risk of a problematic deleveraging and marketplace dislocation is today quite high... I may believe we are on the precipice for one heck of a problem associated with the reversal of speculative flows to risky and illiquid debt instruments. But what this means in the near-term for the U.S. and global equities Game is anything but clear...Moreover, I see no reason why we should not expect today’s unfathomable derivatives markets to run amuck...today’s global Credit apparatus has extraordinary command over the liquidity-creation process. It’s just losing more and more control over inflationary effects in an asset manic world. Wall Street is immersed in a dangerous Game."
Henry To: "There are now signs of stress creeping up in the CMBS sector, in addition to the troubles that we have been witnessing in both the CDO and the CLO market. Moreover, within the subprime mortgage market, we are also now witnessing significant losses in the 2005 vintage as well, as opposed to only the riskier 2006 vintage. The years of excesses are now starting to come home to roost... Combined with the liquidity headwinds that we have previously discussed, stocks are definitely not too attractive at this point, especially as the Yen carry trade is now very stretched by any measure and as the world's major central banks are still in a tightening phase...Given that the market had been relentlessly rising since the mid June 2006 bottom, and given that it also quickly shrugged off the subprime troubles during late February to mid March, there is good reason to believe that many investors are ignoring clear road signs that liquidity is declining drastically - and that, at some point, it is going to have a significant impact on stock prices...the Swiss Franc carry trade is now estimated to be over $650 billion large - with most of the "carry traders" located in Eastern Europe. As a matter of fact, many of these "carry traders" are households and small businesses who have taken out mortgages or loans denominated in Swiss Francs...In the case of the liquidity-induced correction that I have been looking for over the next three to six months, the culprit is the tremendous increase in both the NYSE and the NASDAQ short interest over the last four months...the increase in NYSE short interest has been nothing short of dramatic over the last few months - an increase which could only be matched by the increase in short interest during the 2000 to 2002 bear market. As a matter of fact, the latest 12-month increase in short interest just hit a record high of 37.2%! This increase in short interest on the NYSE is also being confirmed by the increase and outstanding short interest on the NASDAQ Composite...the Achilles' Heel for the bearish scenario over the next few months is the abnormally high amount of short interest on both the NYSE and the NASDAQ Composite. Should the market fail to start correcting soon, then many short-sellers could start losing patience with their short positions and start covering - thus causing a tremendous short-covering rally."
John Mauldin: "Let's assume for a moment that the highest estimates of subprime mortgage defaults are correct. That would suggest losses of $250 billion. But these homes will not go to zero. Even if they drop by 40% for a total market loss of $100 billion, that is going to get absorbed by thousands of funds and investors. No one will be happy (except the lawyers), and a few banking institutions will end up being taken over as their balance sheets decline and make them vulnerable, but the mortgage losses will not directly put the system at risk. It will mean that home valuations are likely to drop more than most market forecasters are projecting, and thus cash-out financing is going to drop, but in the grand scheme of things that is not a severe blow to the overall economy. The one true risk that is simply not knowable at this point is in the Credit Default Swap (CDS) market. Basically, the CDS market allows an investor to pass on the risk as well as the returns of a loan or a basket of loans. It is a form of insurance. If you are a bank and need to clean up your balance sheet, you simply go to a CDS dealer and find someone who will take your risk for a price. A fund, trading desk, or bank can make a nice premium selling CDSs and show very steady returns, somewhat like selling naked options. The CDS market is huge, in the hundreds of trillions of dollars and growing dramatically. There is said to be about $1 trillion in CDSs for an underlying $20 billion in GM debt. There are institutions which both buy and sell CDSs, trading them for an arbitrage profit. As long as there is adequate collateral, there is no problem. The game can go on. And it is an important game. There is a reason this market has become so large so quickly. A CDS can be a very useful risk management tool. It is one of the reasons that the markets are so liquid. If there is a hiccup in this market, it could cause serious problems in a very short time. And the hiccup could be caused by a few institutions or funds not being able to honor their Credit Default Swaps. There is no agency overseeing counter-party risk. This is the one true systemic risk that I see. How probable a risk is it? Not very, but the problem if one developed would be so huge that it is worth paying attention to."
Exxon Mobil pumped just 3 percent of the world's oil last year. National oil companies, which control almost 90 percent of global oil reserves, produced the bulk of the world's supply.
There is more trade going on today between China and Africa than ever before. In the late 1980s, trade between the country and the continent was $12 million. Last year, according to official Chin-ese figures, it reached a record $55 billion. In 1991, Chinese direct investment in Africa was less than $5 million a year. In 2006 - China's official "Year of Africa" - it reached $1.25 billion, according to the Chinese Academy of Social Sciences. Last year, Angola overtook Saudi Arabia as the largest oil supplier to China, and Sudan - China's second-largest supplier on the continent - sold close to 65 per cent of its oil to Beijing. China is also either drilling or exploring for oil in more than half a dozen other African countries. China is extracting copper from Zambia and cobalt (a key ingredient in making cellphones and laptop computers) from Congo, buying timber in such countries as Cameroon and Liberia, and getting manganese for manufacturing steel from Ghana. South Africa is one of China's biggest suppliers of iron ore. With $55 billion in trade with Africa last year, China has quickly inched past France ($47 billion) to become the continent's second-largest bilateral trading partner, after the US ($91 billion), according to the International Monetary Fund. Martyn Davies, head of the Centre for China Studies at South Africa's Stellenbosch University, estimates that within five years, China will be the continent's top trading partner.
The American Research Group announced that in a recent poll, 54 percent of Americans favor impeaching Dick Cheney and 45 percent favor impeaching George W. Bush. The poll surveyed 1,100 people July 3-5.
Friday, July 06, 2007
Changing Patterns
7/7/07 Changing Patterns
India's central bank estimates inflation in fiscal year ending March 31 will be around 5%.
On Friday, forecasters predicted a high of 107 in Boise — six degrees higher than the 101 record for that date set in 1985. Even Stanley, Idaho, which at more than 6,000 feet elevation is routinely the coldest place in the lower 48 states, was seeing record highs, the National Weather Service said. The remote town in the Sawtooth Mountains reached 92 degrees Thursday, and was expected to hit 93 degrees Friday. St. George, Utah, hit 115 degrees by 5 p.m. Thursday, a day after a nearby weather sensor recorded an unofficial reading of 118, which would top the state's all-time record of 117 set in St. George in 1985. Summer temperatures across Utah are running 10 to 15 degrees above normal, meteorologist Brandon Smith said. Around Las Vegas — where temperatures reached 116 degrees Thursday afternoon — transformers overheated and caused electrical pole fires because of all the people switching on their air conditioners, said Scott Allison with the Clark County Fire Department. In Spokane, Wash., the temperature reached 101 degrees, surpassing the record 100 degrees. Northeastern Oregon residents experienced what was expected to be the hottest day of the year Thursday, with temperatures reaching 108 in Pendleton and 107 in Hermiston.
Rio Tinto has hired Credit Suisse and Deutsche Bank to advise on a range of options, including a bid for Alcan, the U.K. newspaper Daily Telegraph reported Friday. The paper said another less likely possibility is that Rio will mount a bid for Alcoa. Alcan hired Rio's long-standing adviser, Morgan Stanley, to fend off the hostile Alcoa offer, the report said. Rio Tinto is thought to have already held tentative talks with Alcan's management on a white knight offer. With Rio Tinto shares hitting new highs recently, the market cap is now $118 billion or almost 4 times that of Alcan's $31 billion, and there is plenty of flexibility for a stock exchange.
Microsoft Corp. said on Thursday said it would take a more than $1 billion charge to fix "an unacceptable number of repairs" to its Xbox 360 video game consoles and had missed shipment targets for the end of June. What Microsoft needs most is to fix its management.
Newmont Mining Corp. is eliminating its entire 1.85 million-ounce gold hedge position and plans to discontinue its merchant banking segment.
“We cannot continue asking our troops to sacrifice indefinitely while the Iraqi government is not making measurable progress,” said Mr. Domenici, a six-term senator who has been a steadfast supporter of the president. Thus Mr. Domenici joined a growing number of Republican voices in opposition to the war just as Senate Democratic leaders are readying plans to put the political and policy focus back on Iraq next week.
Shell, Nigeria’s largest foreign oil producer, said recently that it would not re-start its production in a key sector of the delta region for the rest of 2007 as security concerns persist. ICE August Brent, the world’s benchmark, hit $75.10 a barrel in early morning trading on Friday.
“Opec appears unwilling to contemplate raising output before its September meeting, a policy stance which will push prices higher as refiners around the world begin to compete more vigorously for crude to support higher runs over the coming months,” the Center for Global Energy Studies, a London-based consultancy, warned in a recent report.
August crude closed at $72.81 a barrel Friday, up $1 for the day and up $2.13, or 3%, for the week. August natural gas fell by 2.6% to close at $6.444 per million British thermal units. It finished at its lowest level since May 2005, down 4.9% for the week.
Nonfarm payrolls rise 132,000 in June. Construction jobs up 12,000; service payrolls up 135,000; the average workweek up to 33.9 hours while average hourly wages up 3.9%. American manufacturing lost another 18,000 jobs. I won't comment further on this report. It will be revised at a later date.
Boeing delivered 114 commercial airplanes in the second quarter, its highest total since 2001. The deliveries ran the aerospace company's total through the first half of the year to 220, leaving it on target to reach its full-year estimate of 440 to 445. Boeing's deliveries for the quarter included 86 737s, 21 777s, four 747s and three 767s.
Followers of Iraqi Shiite cleric Moqtada Al Sadr Thursday joined a growing chorus of Sunni, Kurdish, and Shiite opposition to a draft oil law backed by Washington. Amended draft legislation on the crucial distribution of oil wealth in Iraq was approved by Maliki's cabinet Tuesday and could go to parliament for review as early as next week.
Food prices are set for a period of “significant and long-lasting” inflation because of demand from China and India and the use of crops for biofuels, according to the head of Nestlé. Peter Brabeck, chairman of the world’s largest food company, said rises in food prices reflected not only temporary factors but also long-term and structural changes in supply and demand. “They will have a long-lasting impact on food prices,” he told the Financial Times during a visit to China.
"It is about recruiting the best and brightest, and right now, the majority are coming from overseas," Marc Seaman, a spokesman for the world's biggest software company, told The Globe and Mail newspaper. "The United States has immigration quotas and some limitations for bringing in people from outside the country," he said. "That challenge is an opportunity for Canada, in the sense that this will bring the top software developers to Canada." The development office, to be opened in Vancouver, a three-hour drive north from Microsoft's Redmond, Washington headquarters, will initially be staffed by some 300 recruits from around the world, the company said. US software behemoth Microsoft Corp. said Thursday it would soon open an office in Canada, lamenting tough immigration rules in the United States that make it difficult to hire foreign staff.
Meritage Homes Corp. said its preliminary second-quarter home orders fell 28% from a year earlier to $502 million. Its cancellations rose to 37% of gross orders, up from 32% in the year-ago quarter and from 27% in the first quarter of 2007. "Weak demand and high inventory levels have increased competition among home builders, pressuring margins despite reductions in new home starts, lot supplies and operating costs," said Chief Executive Steven Hilton in a statement. The company said it expects to book additional pre-tax charges between $75 million and $80 million for the quarter as a result of inventory impairments and land-option write-offs.
Alcan Inc. said on Friday that a $28.6 billion hostile offer from Alcoa Inc. remains inadequate and the big Canadian aluminum maker is pursuing alternatives such as talks with other groups. In the meantime, Alcoa Inc. says US antitrust authorities want more information on the aluminum company's $27-billion hostile takeover offer for Montreal-based rival Alcan Inc.
Natural-gas inventories rose by 78 billion cubic feet for the week ended June 29, the Energy Department said Friday. Total stocks now stand at 2.521 trillion cubic feet, down 84 billion cubic feet from the year-ago level, but 364 billion cubic feet above the five-year average, the government data said.
Chaparral Steel, Silver Wheaton, and Eldorado Gold all traded at 52-week highs on Friday.
August gold closed at $654.80 an ounce Friday, up $4.20 for the day and up $3.90 for the week. September silver rose 17.7 cents to close at $12.757 an ounce, up 2.3% for the week. September copper added 0.1 cent to finish at $3.5945 a pound, up 4.2% for the week.
The number of rigs drilling for oil and natural gas in North America rose by 32, or 1.6%, to 2,038, according to a weekly update by Baker Hughes Inc. The U.S. rig count fell by 23 from last week to 1,752, while the offshore rig count rose by one to 79. The Canadian rig count increased by 55 to 286. In addition, the number of gas rigs fell by 16 to 1,473, while the oil rig count dropped by 7 to 274, Baker Hughes reported.
India's central bank estimates inflation in fiscal year ending March 31 will be around 5%.
On Friday, forecasters predicted a high of 107 in Boise — six degrees higher than the 101 record for that date set in 1985. Even Stanley, Idaho, which at more than 6,000 feet elevation is routinely the coldest place in the lower 48 states, was seeing record highs, the National Weather Service said. The remote town in the Sawtooth Mountains reached 92 degrees Thursday, and was expected to hit 93 degrees Friday. St. George, Utah, hit 115 degrees by 5 p.m. Thursday, a day after a nearby weather sensor recorded an unofficial reading of 118, which would top the state's all-time record of 117 set in St. George in 1985. Summer temperatures across Utah are running 10 to 15 degrees above normal, meteorologist Brandon Smith said. Around Las Vegas — where temperatures reached 116 degrees Thursday afternoon — transformers overheated and caused electrical pole fires because of all the people switching on their air conditioners, said Scott Allison with the Clark County Fire Department. In Spokane, Wash., the temperature reached 101 degrees, surpassing the record 100 degrees. Northeastern Oregon residents experienced what was expected to be the hottest day of the year Thursday, with temperatures reaching 108 in Pendleton and 107 in Hermiston.
Rio Tinto has hired Credit Suisse and Deutsche Bank to advise on a range of options, including a bid for Alcan, the U.K. newspaper Daily Telegraph reported Friday. The paper said another less likely possibility is that Rio will mount a bid for Alcoa. Alcan hired Rio's long-standing adviser, Morgan Stanley, to fend off the hostile Alcoa offer, the report said. Rio Tinto is thought to have already held tentative talks with Alcan's management on a white knight offer. With Rio Tinto shares hitting new highs recently, the market cap is now $118 billion or almost 4 times that of Alcan's $31 billion, and there is plenty of flexibility for a stock exchange.
Microsoft Corp. said on Thursday said it would take a more than $1 billion charge to fix "an unacceptable number of repairs" to its Xbox 360 video game consoles and had missed shipment targets for the end of June. What Microsoft needs most is to fix its management.
Newmont Mining Corp. is eliminating its entire 1.85 million-ounce gold hedge position and plans to discontinue its merchant banking segment.
“We cannot continue asking our troops to sacrifice indefinitely while the Iraqi government is not making measurable progress,” said Mr. Domenici, a six-term senator who has been a steadfast supporter of the president. Thus Mr. Domenici joined a growing number of Republican voices in opposition to the war just as Senate Democratic leaders are readying plans to put the political and policy focus back on Iraq next week.
Shell, Nigeria’s largest foreign oil producer, said recently that it would not re-start its production in a key sector of the delta region for the rest of 2007 as security concerns persist. ICE August Brent, the world’s benchmark, hit $75.10 a barrel in early morning trading on Friday.
“Opec appears unwilling to contemplate raising output before its September meeting, a policy stance which will push prices higher as refiners around the world begin to compete more vigorously for crude to support higher runs over the coming months,” the Center for Global Energy Studies, a London-based consultancy, warned in a recent report.
August crude closed at $72.81 a barrel Friday, up $1 for the day and up $2.13, or 3%, for the week. August natural gas fell by 2.6% to close at $6.444 per million British thermal units. It finished at its lowest level since May 2005, down 4.9% for the week.
Nonfarm payrolls rise 132,000 in June. Construction jobs up 12,000; service payrolls up 135,000; the average workweek up to 33.9 hours while average hourly wages up 3.9%. American manufacturing lost another 18,000 jobs. I won't comment further on this report. It will be revised at a later date.
Boeing delivered 114 commercial airplanes in the second quarter, its highest total since 2001. The deliveries ran the aerospace company's total through the first half of the year to 220, leaving it on target to reach its full-year estimate of 440 to 445. Boeing's deliveries for the quarter included 86 737s, 21 777s, four 747s and three 767s.
Followers of Iraqi Shiite cleric Moqtada Al Sadr Thursday joined a growing chorus of Sunni, Kurdish, and Shiite opposition to a draft oil law backed by Washington. Amended draft legislation on the crucial distribution of oil wealth in Iraq was approved by Maliki's cabinet Tuesday and could go to parliament for review as early as next week.
Food prices are set for a period of “significant and long-lasting” inflation because of demand from China and India and the use of crops for biofuels, according to the head of Nestlé. Peter Brabeck, chairman of the world’s largest food company, said rises in food prices reflected not only temporary factors but also long-term and structural changes in supply and demand. “They will have a long-lasting impact on food prices,” he told the Financial Times during a visit to China.
"It is about recruiting the best and brightest, and right now, the majority are coming from overseas," Marc Seaman, a spokesman for the world's biggest software company, told The Globe and Mail newspaper. "The United States has immigration quotas and some limitations for bringing in people from outside the country," he said. "That challenge is an opportunity for Canada, in the sense that this will bring the top software developers to Canada." The development office, to be opened in Vancouver, a three-hour drive north from Microsoft's Redmond, Washington headquarters, will initially be staffed by some 300 recruits from around the world, the company said. US software behemoth Microsoft Corp. said Thursday it would soon open an office in Canada, lamenting tough immigration rules in the United States that make it difficult to hire foreign staff.
Meritage Homes Corp. said its preliminary second-quarter home orders fell 28% from a year earlier to $502 million. Its cancellations rose to 37% of gross orders, up from 32% in the year-ago quarter and from 27% in the first quarter of 2007. "Weak demand and high inventory levels have increased competition among home builders, pressuring margins despite reductions in new home starts, lot supplies and operating costs," said Chief Executive Steven Hilton in a statement. The company said it expects to book additional pre-tax charges between $75 million and $80 million for the quarter as a result of inventory impairments and land-option write-offs.
Alcan Inc. said on Friday that a $28.6 billion hostile offer from Alcoa Inc. remains inadequate and the big Canadian aluminum maker is pursuing alternatives such as talks with other groups. In the meantime, Alcoa Inc. says US antitrust authorities want more information on the aluminum company's $27-billion hostile takeover offer for Montreal-based rival Alcan Inc.
Natural-gas inventories rose by 78 billion cubic feet for the week ended June 29, the Energy Department said Friday. Total stocks now stand at 2.521 trillion cubic feet, down 84 billion cubic feet from the year-ago level, but 364 billion cubic feet above the five-year average, the government data said.
Chaparral Steel, Silver Wheaton, and Eldorado Gold all traded at 52-week highs on Friday.
August gold closed at $654.80 an ounce Friday, up $4.20 for the day and up $3.90 for the week. September silver rose 17.7 cents to close at $12.757 an ounce, up 2.3% for the week. September copper added 0.1 cent to finish at $3.5945 a pound, up 4.2% for the week.
The number of rigs drilling for oil and natural gas in North America rose by 32, or 1.6%, to 2,038, according to a weekly update by Baker Hughes Inc. The U.S. rig count fell by 23 from last week to 1,752, while the offshore rig count rose by one to 79. The Canadian rig count increased by 55 to 286. In addition, the number of gas rigs fell by 16 to 1,473, while the oil rig count dropped by 7 to 274, Baker Hughes reported.
Thursday, July 05, 2007
Interest Rates
7/6/07 Interest Rates
The European Central Bank held its benchmark interest rate steady at 4 percent Thursday, as unemployment is dropping and inflation appears to be under control in the 13-nation region that shares the euro.The decision followed a move by the Bank of England to raise rates by a quarter of a percentage point to 5.75 percent.
Jean-Claude Trichet, president of the European Central Bank, hinted in his introductory statement that the central bank may raise rates from 4%. He said there was upside inflation risks and used the phrase "accommodative" to describe current rates. He also warned of capacity contraints as the labor market tightens.
Hilton Hotels Corp. said on Thursday that it must pay Blackstone Group $560 million if it receives a better offer and terminates a takeover agreement with the private equity firm.
If President Bush or Vice President Dick Cheney were ever to be impeached, their foes could cite this Independence Day as a milestone — the day that the nation's first "impeachment headquarters" opened its doors in a storefront near the Beverly Center.
"This is an impeachment 4th of July," Byron De Lear, a Green Party activist, said Wednesday. He called removing Bush and Cheney "a patriotic duty to restore the integrity of the United States."
According to the WSJ, office rents are skyrocketing across the nation, driving up costs for businesses large and small, thanks to a dearth of space in some major markets and a new breed of deep-pocketed landlords who can afford to hold out for premium tenants. Nationwide, effective rents on office properties -- the amount tenants pay after concessions -- jumped an average of 3.1% during this year's second quarter, up from gains of 2.8% in the first quarter and 2.1% in the year-earlier period, according to a report scheduled for release today by real-estate research firm Reis Inc.
Capital raised by new listings in China is set to exceed $52bn this year, twice the figure forecast in January, putting the mainland on track to become the world’s leading centre for share offerings this year.
About 4,500 lumber workers on Canada's Pacific Coast will strike this weekend unless a contract deal is reached with their employers, the union said Wednesday. The United Steelworkers filed a 72-hour strike notice with industry-bargaining agent Forest Industrial Relations late Tuesday after talks stalled over a variety of issues, including shift scheduling for loggers and sawmill workers. The union's previous contract expired last month. The filing of the strike notice would allow the workers to walk off the job at the end of Friday.
Employment in the U.S. private sector grew by 150,000 in June, the fastest rate in seven months, according to the ADP employment report released Thursday. The report hints that the nation's nonfarm payrolls rose about 175,000 in June after adding in government jobs.
T-Mobile has just launched free WiFi calling for its customers along with standard cell service.
U.S. corporations announced 55,726 layoffs last month, down 22% from May's figure and 17% below the figure from June 2006, according to outplacement firm Challenger Grey & Christmas.
The figures released Thursday are not seasonally adjusted.
For the first half of the year, layoff announcements have totaled 393,499, down 10% compared with a year ago.
Adrian Ash: "In this fiscal year, reckons the War Resisters League, total US military spending - including pensions paid to ex-service staff, interest owing on previous martial debts, plus military spending undertaken by non-defense departments of the government - will account for 51% of total federal expenditure...By Sept. last year, there were more than 1.4 million US personnel on active duty - just above 1% of the entire United States population, both men and women, aged 18-49...Almost $2 billion must be lent to the US every day, in fact, to cover the gap between its income and outgoings."
Richard Benson: "Americans now owe a staggering $16 trillion dollars ($2.4 Trillion in personal loans, and $13.6 trillion borrowed from their house). Yet, as a society, we just can't seem to get away from accumulating debt, and have become nothing short of debt slaves. The American consumer continues to abuse credit that has been offered to them, and pay incredibly high interest charges every month, without blinking an eye. To maintain a certain lifestyle that would ordinarily be unattainable with their current income levels, our nation of consumers is slowly but surely being eaten alive by our own conspicuous consumption."
Samsonite Corp. agreed to be acquired by funds affiliated with private-equity company CVC Capital Partners for $1.49 per share, or about $1.11 billion.
Australia’s defense minister: "For these reasons in particular ... , one of which is energy security, it is extremely important that Australia take the view that it's in ... our security interests to make sure that we leave the Middle East, and leave Iraq in particular, in a position of sustainable security. "The Middle East itself - not only Iraq - is an
important supplier of energy, oil in particular, to the rest of the world, and Australians need to think what would happen if there were a premature withdrawal from Iraq," he added.
The ISM non-manufacturing index rose to 60.7% from 59.7% in May. Readings over 50% indicate more firms are expanding than contracting. The new-orders index fell in June to 56.9% from 57.4% in May. The employment index rose to 55% from 54.9% in May. The prices-paid index fell to 65.5% in June from 66.4% in May.
Refinery utilization rose to 90.0% of capacity from 89.4% a week ago. The American Petroleum Institute reported a climb of 1.2 million barrels in crude supplies for the week ended June 22. The Energy Department had reported a rise of 3.1 million barrels for the latest week. Motor gasoline supplies were up 48,000 barrels, the API said. The government reported that supplies were up 1.8 million barrels. Distillate supplies climbed 1.7 million barrels, the API said. The government posted a 1.2 million-barrel rise.
Initial jobless claims increased by 2,000 to 318,000 in the week that ended June 30, the Labor Department said today in Washington. The four-week moving average, a less volatile measure, rose to 318,500 from 316,750.
TIAA-CREF, which oversees $414 billion in retirement funds for teachers and college professors, is boycotting some debt offerings used to finance LBOs. Fidelity International, a unit of the world's largest mutual fund company, and Lehman Brothers Asset Management LLC, the money-management arm of the third- biggest bond underwriter, say they're avoiding debt from buyouts.
More financial advisers are predicting a so-called correction in the U.S. stock market than at any other time in almost a decade, according to Investors Intelligence.
The Dhahran, a Saudi Arabia-based company, raised prices for shipments to Europe in August by between 40 cents and 70 cents a barrel, Aramco said in an e-mailed statement. The oil producer also increased prices of Arab Medium and Arab Heavy prices for shipment to Asia, and cut prices of all grades it sells to the U.S. by 35 cents to 50 cents a barrel.
BHP Billiton traded at a new 52-week high of $63+ and Rio Tinto also traded at a new high of $324+. Google joined in the new high club at $541+. Apple was not left behind at $132+. Chaparral Steel is within a smidge of a new 52-week high at $75+. The air is getting thin at these heights.
Advanced Medical Optics Inc. has made a $75 cash-and-stock offer for rival eyecare company Bausch & Lomb Inc., according to a published report Thursday afternoon, trumping a $65-a-share deal with private equity firm Warburg Pincus. The deal is valued at $45 in cash and $30 in stock, the Wall Street Jounral reported on its Web site.
The benchmark 10-year Treasury note closed down 23/32 at 95-3/32 with a yield of 5.141%.
August crude climbed 40 cents to close at $71.81 a barrel Thursday. August natural gas fell 13.6 cents to close at $6.618 per million British thermal units.
August gold fell by $4.80 to close at $650.60 an ounce Thursday. September silver fell by 10.5 cents to close at $12.58 an ounce. September copper closed at $3.5935 a pound, up 1.4%, or 4.85 cents.
The European Central Bank held its benchmark interest rate steady at 4 percent Thursday, as unemployment is dropping and inflation appears to be under control in the 13-nation region that shares the euro.The decision followed a move by the Bank of England to raise rates by a quarter of a percentage point to 5.75 percent.
Jean-Claude Trichet, president of the European Central Bank, hinted in his introductory statement that the central bank may raise rates from 4%. He said there was upside inflation risks and used the phrase "accommodative" to describe current rates. He also warned of capacity contraints as the labor market tightens.
Hilton Hotels Corp. said on Thursday that it must pay Blackstone Group $560 million if it receives a better offer and terminates a takeover agreement with the private equity firm.
If President Bush or Vice President Dick Cheney were ever to be impeached, their foes could cite this Independence Day as a milestone — the day that the nation's first "impeachment headquarters" opened its doors in a storefront near the Beverly Center.
"This is an impeachment 4th of July," Byron De Lear, a Green Party activist, said Wednesday. He called removing Bush and Cheney "a patriotic duty to restore the integrity of the United States."
According to the WSJ, office rents are skyrocketing across the nation, driving up costs for businesses large and small, thanks to a dearth of space in some major markets and a new breed of deep-pocketed landlords who can afford to hold out for premium tenants. Nationwide, effective rents on office properties -- the amount tenants pay after concessions -- jumped an average of 3.1% during this year's second quarter, up from gains of 2.8% in the first quarter and 2.1% in the year-earlier period, according to a report scheduled for release today by real-estate research firm Reis Inc.
Capital raised by new listings in China is set to exceed $52bn this year, twice the figure forecast in January, putting the mainland on track to become the world’s leading centre for share offerings this year.
About 4,500 lumber workers on Canada's Pacific Coast will strike this weekend unless a contract deal is reached with their employers, the union said Wednesday. The United Steelworkers filed a 72-hour strike notice with industry-bargaining agent Forest Industrial Relations late Tuesday after talks stalled over a variety of issues, including shift scheduling for loggers and sawmill workers. The union's previous contract expired last month. The filing of the strike notice would allow the workers to walk off the job at the end of Friday.
Employment in the U.S. private sector grew by 150,000 in June, the fastest rate in seven months, according to the ADP employment report released Thursday. The report hints that the nation's nonfarm payrolls rose about 175,000 in June after adding in government jobs.
T-Mobile has just launched free WiFi calling for its customers along with standard cell service.
U.S. corporations announced 55,726 layoffs last month, down 22% from May's figure and 17% below the figure from June 2006, according to outplacement firm Challenger Grey & Christmas.
The figures released Thursday are not seasonally adjusted.
For the first half of the year, layoff announcements have totaled 393,499, down 10% compared with a year ago.
Adrian Ash: "In this fiscal year, reckons the War Resisters League, total US military spending - including pensions paid to ex-service staff, interest owing on previous martial debts, plus military spending undertaken by non-defense departments of the government - will account for 51% of total federal expenditure...By Sept. last year, there were more than 1.4 million US personnel on active duty - just above 1% of the entire United States population, both men and women, aged 18-49...Almost $2 billion must be lent to the US every day, in fact, to cover the gap between its income and outgoings."
Richard Benson: "Americans now owe a staggering $16 trillion dollars ($2.4 Trillion in personal loans, and $13.6 trillion borrowed from their house). Yet, as a society, we just can't seem to get away from accumulating debt, and have become nothing short of debt slaves. The American consumer continues to abuse credit that has been offered to them, and pay incredibly high interest charges every month, without blinking an eye. To maintain a certain lifestyle that would ordinarily be unattainable with their current income levels, our nation of consumers is slowly but surely being eaten alive by our own conspicuous consumption."
Samsonite Corp. agreed to be acquired by funds affiliated with private-equity company CVC Capital Partners for $1.49 per share, or about $1.11 billion.
Australia’s defense minister: "For these reasons in particular ... , one of which is energy security, it is extremely important that Australia take the view that it's in ... our security interests to make sure that we leave the Middle East, and leave Iraq in particular, in a position of sustainable security. "The Middle East itself - not only Iraq - is an
important supplier of energy, oil in particular, to the rest of the world, and Australians need to think what would happen if there were a premature withdrawal from Iraq," he added.
The ISM non-manufacturing index rose to 60.7% from 59.7% in May. Readings over 50% indicate more firms are expanding than contracting. The new-orders index fell in June to 56.9% from 57.4% in May. The employment index rose to 55% from 54.9% in May. The prices-paid index fell to 65.5% in June from 66.4% in May.
Refinery utilization rose to 90.0% of capacity from 89.4% a week ago. The American Petroleum Institute reported a climb of 1.2 million barrels in crude supplies for the week ended June 22. The Energy Department had reported a rise of 3.1 million barrels for the latest week. Motor gasoline supplies were up 48,000 barrels, the API said. The government reported that supplies were up 1.8 million barrels. Distillate supplies climbed 1.7 million barrels, the API said. The government posted a 1.2 million-barrel rise.
Initial jobless claims increased by 2,000 to 318,000 in the week that ended June 30, the Labor Department said today in Washington. The four-week moving average, a less volatile measure, rose to 318,500 from 316,750.
TIAA-CREF, which oversees $414 billion in retirement funds for teachers and college professors, is boycotting some debt offerings used to finance LBOs. Fidelity International, a unit of the world's largest mutual fund company, and Lehman Brothers Asset Management LLC, the money-management arm of the third- biggest bond underwriter, say they're avoiding debt from buyouts.
More financial advisers are predicting a so-called correction in the U.S. stock market than at any other time in almost a decade, according to Investors Intelligence.
The Dhahran, a Saudi Arabia-based company, raised prices for shipments to Europe in August by between 40 cents and 70 cents a barrel, Aramco said in an e-mailed statement. The oil producer also increased prices of Arab Medium and Arab Heavy prices for shipment to Asia, and cut prices of all grades it sells to the U.S. by 35 cents to 50 cents a barrel.
BHP Billiton traded at a new 52-week high of $63+ and Rio Tinto also traded at a new high of $324+. Google joined in the new high club at $541+. Apple was not left behind at $132+. Chaparral Steel is within a smidge of a new 52-week high at $75+. The air is getting thin at these heights.
Advanced Medical Optics Inc. has made a $75 cash-and-stock offer for rival eyecare company Bausch & Lomb Inc., according to a published report Thursday afternoon, trumping a $65-a-share deal with private equity firm Warburg Pincus. The deal is valued at $45 in cash and $30 in stock, the Wall Street Jounral reported on its Web site.
The benchmark 10-year Treasury note closed down 23/32 at 95-3/32 with a yield of 5.141%.
August crude climbed 40 cents to close at $71.81 a barrel Thursday. August natural gas fell 13.6 cents to close at $6.618 per million British thermal units.
August gold fell by $4.80 to close at $650.60 an ounce Thursday. September silver fell by 10.5 cents to close at $12.58 an ounce. September copper closed at $3.5935 a pound, up 1.4%, or 4.85 cents.
Wednesday, July 04, 2007
Workers' Confidence
7/5/07 Workers'Confidence
U.S. workers' confidence weakened in June to the lowest level in nine months, according to a monthly survey by Hudson Highland Group released Tuesday. The Hudson employment index fell to 101.2 from a May reading of 106.9.
"It appears worker sentiment caved under the pressure of the weak housing market, high energy prices, and inconsistent job growth," said Robert Morgan, president of Hudson Talent Solutions, in a statement.
The percentage of workers surveyed who said their company is hiring fell to 30% from 32%, while 19% of workers said they were worried about their own job security.
Workers were more pessimistic about their own finances, with 43% rating their financial condition favorably, compared with 45% the previous month.
Meanwhile, 41% of workers said their finances are getting worse. It's the first time since last August that more workers were pessimistic than optimistic.
Will this translate into a lessening of consumer spending? We'll have to wait to find out; however, I believe the chances are better than 50-50.
TheOilDrum: "Electricity is a particular concern in the UK where a generation crisis is brewing with the decommission of the aging nuclear fleet, the closure of around a third of the coal fleet under the EU Large Combustion Plant Directive and the rapid depletion of North Sea gas."
Blackstone, which owns more than 100,000 hotel rooms in the U.S. and Europe,
will pay $18.5 billion in cash and assume $7.5 billion of debt for Hilton Hotels.
Hilton investors will receive $47.50 a share, or 32 percent more than Hilton's closing price before the announcement Tuesday afternoon.
More than 180,000 civilians — including Americans, foreigners and Iraqis — are working in Iraq under U.S. contracts, according to State and Defense department figures obtained by the Los Angeles Times.
Including the recent troop buildup, 160,000 soldiers and a few thousand civilian government employees are stationed in Iraq.
Apollo Management unveiled a $6 billion bid proposal for Huntsman Corp on Wednesday, 8 percent higher than a deal accepted by the U.S. chemical company last week. Huntsman, whose products are used in paints, footwear and cleaning products, said the new proposal was from Apollo's Hexion Specialty Chemicals Inc and was worth $27.25 per share.
The British pound reached another 26-year high against the dollar Wednesday, topping $2.02 and hitting its highest level since 1981 amid expectations that the Bank of England will hike interest rates to 5.75% later in the week.
Hong Kong-listed shares of Chinese Estates Holdings surged Wednesday after the property developer said it has received an approach from outside investors about a possible takeover.
Australia's trade deficit narrowed to A$807 million ($691.1 million) in May from A$916 million in April, the statistics bureau said Wednesday. Australia recorded a deficit of A$2.144 billion in May 2006. Australia's Reserve Bank held its base lending rate unchanged at 6.25% Wednesday.
Meridian Gold Inc. said that Yamana Gold Inc.'s unsolicited acquisition proposal does not provide a basis to enter into merger talks.
According to an SEC filing from 8-K, Alcoa Chief Executive Alain Belda sent a letter June 20 to Alcan CEO Dick Evans asking about press reports of a "data room" Alcan was setting up so that parties interested in bidding on Alcan could examine company data and documents. In the discussion between the CEOs, Mr. Belda also alluded to possibilities of an improved bid from the current cash and stock bid of $27.8 billion."I am ready to consider value for your shareholders beyond that reflected in our outstanding offer," Mr. Belda wrote in series of exchanges, this one dated June 28.
Financial Times editorial comment: "Throughout his presidency, George W. Bush has repeatedly undermined America’s image as a country where justice is above politics, where truth is an ally of good government and where all men stand equal before the law. He did so again on Monday, when he commuted the sentence of Lewis “Scooter” Libby, the former White House loyalist found guilty of trying to pervert the cause of justice by lying." When the Appeals Court turned down Libby's appeal, Bush was forced to act. With that denial from the Appeals Court, Libby could no longer take the 5th in the upcoming civil trial. It would have opened the Administration to intense scrutiny with regards to the Plame matter.
Dendreon shares got its boost Tuesday from a study published in the latest issue of Clinical Cancer Research, which said that although there's no proof yet that therapeutic cancer vaccines can reduce malignant tumors, there's mounting evidence that they can extend survival and provide benefits when combined with other therapies. The peer-reviewed journal is published by the prestigious American Association for Cancer Research.
Chrysler Group signed a deal Wednesday with China's biggest automaker, Chery, to produce cars for export to the United States and elsewhere in the first attempt by a U.S. automaker to use China as a manufacturing base for world markets. The first cars will be exported within a year to Latin America or Eastern Europe, and models should reach the United States and Western Europe within 2 1/2 years, said Chrysler Chairman and CEO Tom LaSorda.
BP and Royal Dutch Shell are said to be in merger talks that would create a £250 billion oil giant, according to the Times of London.
Two New Zealanders have been kidnapped by gunmen who attacked a Shell oil rig in the Niger Delta in southern Nigeria. "Early this morning there was an attack on a Shell facility at Soku. Armed men came in several boats, opened fire on security and abducted five expatriates," said an oil industry source in the regional capital Port Harcourt.
The U.S. dollar was trading at 122.38 yen at 2:50 p.m. Wednesday, down from 122.43 yen late Tuesday in New York. The euro rose to $1.3620 from $1.3603.
The ABA said its combined measure of payment delinquencies on eight types of loans -- including those tied to home equity and used to purchase automobiles, mobile homes and boats -- showed that consumers were behind on 2.42 percent of all such loans in the first quarter, up from 2.23 percent in the previous quarter.
Gary Dorsch: "Since the Bernanke Fed discontinued the decades-old reporting of the broad M3 money supply in March of 2006, the growth rate of M3 has accelerated from an 8% rate to a sizzling 13.7% clip, its fastest in more than three decades. The Bernanke Fed is preventing borrowing rates from rising at a time of explosive loan demand for US corporate mergers and takeovers, by rapidly increasing the US money supply...While the Fed is inflating its M3 money supply at a 13.7% clip, the Bank of England is inflating its M4 at a 13.9% annualized clip. But the US economy is roughly six times the size of England's, so in absolute terms, the increase in supply of US dollars is much larger. And with the BoE expected to lift its lending rates to 75 basis points above the US$ rate, the pound is winning this "reverse beauty" contest...One central bank that cannot contemplate higher interest rates however, is the Bernanke Fed, which is hamstrung by a sliding market for the weakest sector of the sub-prime mortgage loan market. The benchmark ABX 07-1 BBB index, which is tied to sub-prime mortgage loans, fell to 53.16 cents on the dollar, and has tumbled 43% since January. ABX's are sub-prime loan mortgages which are bundled in securities."
U.S. workers' confidence weakened in June to the lowest level in nine months, according to a monthly survey by Hudson Highland Group released Tuesday. The Hudson employment index fell to 101.2 from a May reading of 106.9.
"It appears worker sentiment caved under the pressure of the weak housing market, high energy prices, and inconsistent job growth," said Robert Morgan, president of Hudson Talent Solutions, in a statement.
The percentage of workers surveyed who said their company is hiring fell to 30% from 32%, while 19% of workers said they were worried about their own job security.
Workers were more pessimistic about their own finances, with 43% rating their financial condition favorably, compared with 45% the previous month.
Meanwhile, 41% of workers said their finances are getting worse. It's the first time since last August that more workers were pessimistic than optimistic.
Will this translate into a lessening of consumer spending? We'll have to wait to find out; however, I believe the chances are better than 50-50.
TheOilDrum: "Electricity is a particular concern in the UK where a generation crisis is brewing with the decommission of the aging nuclear fleet, the closure of around a third of the coal fleet under the EU Large Combustion Plant Directive and the rapid depletion of North Sea gas."
Blackstone, which owns more than 100,000 hotel rooms in the U.S. and Europe,
will pay $18.5 billion in cash and assume $7.5 billion of debt for Hilton Hotels.
Hilton investors will receive $47.50 a share, or 32 percent more than Hilton's closing price before the announcement Tuesday afternoon.
More than 180,000 civilians — including Americans, foreigners and Iraqis — are working in Iraq under U.S. contracts, according to State and Defense department figures obtained by the Los Angeles Times.
Including the recent troop buildup, 160,000 soldiers and a few thousand civilian government employees are stationed in Iraq.
Apollo Management unveiled a $6 billion bid proposal for Huntsman Corp on Wednesday, 8 percent higher than a deal accepted by the U.S. chemical company last week. Huntsman, whose products are used in paints, footwear and cleaning products, said the new proposal was from Apollo's Hexion Specialty Chemicals Inc and was worth $27.25 per share.
The British pound reached another 26-year high against the dollar Wednesday, topping $2.02 and hitting its highest level since 1981 amid expectations that the Bank of England will hike interest rates to 5.75% later in the week.
Hong Kong-listed shares of Chinese Estates Holdings surged Wednesday after the property developer said it has received an approach from outside investors about a possible takeover.
Australia's trade deficit narrowed to A$807 million ($691.1 million) in May from A$916 million in April, the statistics bureau said Wednesday. Australia recorded a deficit of A$2.144 billion in May 2006. Australia's Reserve Bank held its base lending rate unchanged at 6.25% Wednesday.
Meridian Gold Inc. said that Yamana Gold Inc.'s unsolicited acquisition proposal does not provide a basis to enter into merger talks.
According to an SEC filing from 8-K, Alcoa Chief Executive Alain Belda sent a letter June 20 to Alcan CEO Dick Evans asking about press reports of a "data room" Alcan was setting up so that parties interested in bidding on Alcan could examine company data and documents. In the discussion between the CEOs, Mr. Belda also alluded to possibilities of an improved bid from the current cash and stock bid of $27.8 billion."I am ready to consider value for your shareholders beyond that reflected in our outstanding offer," Mr. Belda wrote in series of exchanges, this one dated June 28.
Financial Times editorial comment: "Throughout his presidency, George W. Bush has repeatedly undermined America’s image as a country where justice is above politics, where truth is an ally of good government and where all men stand equal before the law. He did so again on Monday, when he commuted the sentence of Lewis “Scooter” Libby, the former White House loyalist found guilty of trying to pervert the cause of justice by lying." When the Appeals Court turned down Libby's appeal, Bush was forced to act. With that denial from the Appeals Court, Libby could no longer take the 5th in the upcoming civil trial. It would have opened the Administration to intense scrutiny with regards to the Plame matter.
Dendreon shares got its boost Tuesday from a study published in the latest issue of Clinical Cancer Research, which said that although there's no proof yet that therapeutic cancer vaccines can reduce malignant tumors, there's mounting evidence that they can extend survival and provide benefits when combined with other therapies. The peer-reviewed journal is published by the prestigious American Association for Cancer Research.
Chrysler Group signed a deal Wednesday with China's biggest automaker, Chery, to produce cars for export to the United States and elsewhere in the first attempt by a U.S. automaker to use China as a manufacturing base for world markets. The first cars will be exported within a year to Latin America or Eastern Europe, and models should reach the United States and Western Europe within 2 1/2 years, said Chrysler Chairman and CEO Tom LaSorda.
BP and Royal Dutch Shell are said to be in merger talks that would create a £250 billion oil giant, according to the Times of London.
Two New Zealanders have been kidnapped by gunmen who attacked a Shell oil rig in the Niger Delta in southern Nigeria. "Early this morning there was an attack on a Shell facility at Soku. Armed men came in several boats, opened fire on security and abducted five expatriates," said an oil industry source in the regional capital Port Harcourt.
The U.S. dollar was trading at 122.38 yen at 2:50 p.m. Wednesday, down from 122.43 yen late Tuesday in New York. The euro rose to $1.3620 from $1.3603.
The ABA said its combined measure of payment delinquencies on eight types of loans -- including those tied to home equity and used to purchase automobiles, mobile homes and boats -- showed that consumers were behind on 2.42 percent of all such loans in the first quarter, up from 2.23 percent in the previous quarter.
Gary Dorsch: "Since the Bernanke Fed discontinued the decades-old reporting of the broad M3 money supply in March of 2006, the growth rate of M3 has accelerated from an 8% rate to a sizzling 13.7% clip, its fastest in more than three decades. The Bernanke Fed is preventing borrowing rates from rising at a time of explosive loan demand for US corporate mergers and takeovers, by rapidly increasing the US money supply...While the Fed is inflating its M3 money supply at a 13.7% clip, the Bank of England is inflating its M4 at a 13.9% annualized clip. But the US economy is roughly six times the size of England's, so in absolute terms, the increase in supply of US dollars is much larger. And with the BoE expected to lift its lending rates to 75 basis points above the US$ rate, the pound is winning this "reverse beauty" contest...One central bank that cannot contemplate higher interest rates however, is the Bernanke Fed, which is hamstrung by a sliding market for the weakest sector of the sub-prime mortgage loan market. The benchmark ABX 07-1 BBB index, which is tied to sub-prime mortgage loans, fell to 53.16 cents on the dollar, and has tumbled 43% since January. ABX's are sub-prime loan mortgages which are bundled in securities."
Tuesday, July 03, 2007
Independence And Freedom
7/4/07 Independence And Freedom
George Carlin: “I do this real moron thing, it's called thinking, and I'm not a very good Amercian because I like to form my own opionions.”
Albert Einstein: “For those who would joyously march in rank and file, they have already earned my contempt, for they were given a large brain by accident when a spinal chord would have sufficed.”
John Hussman: " Investors need not take market risk at all times (or even a majority of the time) to capture the long-term return of the stock market. What is needed most is the avoidance of deep losses. It also helps to be willing to accept market exposure when valuations are depressed and other investors are bearish - particularly when yield pressures are falling."
Brett Steenbarger: "We've had four consecutive days of strong NYSE TICK, with my cumulative Adjusted TICK measure averaging over 500 per day over that period. Interestingly, going back to 2004 (N = 870 trading days), when we've had four consecutive up days in the TICK, the next five days in the S&P 500 Index (SPY) have averaged a loss of -.07% (39 up, 41 down). When the Adjusted TICK over those four days has averaged over 500, however, the next five days in SPY have averaged a healthy gain of .50% (9 up, 6 down). When the Adjusted TICK has averaged below 500, the next five days have averaged a loss of -.20% (30 up, 35 down). As we saw on Monday, it's difficult to fade a market in which large traders are persistently lifting offers across a broad range of stocks."
"The 'feel' of the consumer spending trend might best be characterized as slow, choppy and uncertain," said Michael Niemira, chief economist for ICSC. "Though more retailers seemingly share this view, we continue to believe that slower spending trends have been largely in place since February."
Teck Cominco agreed to buy Aur Resources for C$4.1 billion ($3.89 billion) in cash and shares. Aur shareholders will receive C$41.00 or 0.8749 of a Teck Class B subordinate voting share per Aur common share. The offer represents a premium of 29% based on the 20-day volume weighted average closing prices of the companies on June 29, according to Teck Cominco.
Danone agreed to sell its biscuit business to U.S. rival Kraft for 5.3 billion euros ($7.2 billion) in cash.
The American Bankers Association, in its quarterly survey of consumer loans, reported today that late payments on home equity loans rose to 2.15 percent in the January-to-March quarter. That was up sharply from 1.92 percent in the final quarter of last year and was the highest since the late summer of 2005.
Yahoo's advertising service, SmartAds, uses behavioral, demographic and geographic information to try to connect people with marketing that caters to their interests. Yahoo said it is its largest effort to cull information about its users.
Oil companies in Brazil will invest up to $133 billion between 2007 and 2016 in the exploration and production of crude and natural gas, according to official estimates released by the Energy and Mines Ministry.
The investment plans of oil companies operating in Brazil, led by state-run Petrobras, are contained in the 2007-2016 Ten-Year Plan for Energy Expansion.
Rio Tinto Iron Ore Group CEO Sam Walsh said the iron ore market is "extremely tight." He told analysts the company "quite frankly, can't meet demand."
India's rupee rose, in the biggest quarterly gain in 3 1/2 decades, as the world's second-fastest pace of economic growth and a $1 trillion stock market attracted overseas investors. The currency gained 6.8 percent this quarter as the government allowed the rupee to advance to make imports cheaper. India's current account showed a surplus, for the first time in a year, in the three months through March, as software exports increased and oil imports slowed, a report showed yesterday.
Higher gas prices, dry weather in parts of the United States, strong consumer demand and higher feed prices are behind a five percent increase in Wisconsin retail food prices in the second quarter of the year. That's according to the Wisconsin Farm Bureau Federation's Market Basket survey, which showed that the average cost of 20 selected food items in 26 communities was $50.33--up $2.48 compared to the first quarter of 2007.
Coffeyville Resources, a 108,000 barrel-per-day refinery, sustained a sizable spill as its facilities were swamped with waters that rose more than 30 feet. The oil spill contaminated the floodwaters, sweeping dark, foul-smelling water into homes and businesses and turning roads into rushing streams. The spill also contaminated the Verdigris River, sparking fears about contamination of lakes downstream in Oklahoma, officials said. In addition, Flint Hills Resources LP, a unit of Koch Industries Inc., shut a gasoline-producing unit at its refinery in Corpus Christi, Texas, according to a report on a state Web site.
China's central bank said it will ``moderately'' tighten monetary policy to control investment and lending growth and prevent the economy overheating this year.
Steve Saville: "The central bank's purpose is NOT to set the price of credit at the CORRECT level (the correct level is where the price would be in the ABSENCE of the central bank). Instead, the main purpose of the central bank is to facilitate inflation by ensuring that the real price of credit remains at an artificially LOW level most of the time. That's why, after several decades of central banking, we have arrived at the point where there is an enormous and unprecedented global glut of credit (sometimes mistakenly referred to as a savings glut)."
The total value of construction put in place in May 2007 increased by 0.9% on a seasonally adjusted basis from April, and was down 2.8% year-over-year. However, excluding the impact of residential construction, which was down 0.8% from April and 17.3% year-over-year, the value of non-residential construction increased 2.5% from April, and was up 15.4% year over year.
Global mergers and acquisitions volume surged to $2.88 trillion in the first half of 2007 up 55% from the same period a year ago, according to Dealogic.
Orders for U.S.-made factory goods fell 0.5% in May, the Commerce Department estimated Tuesday. It was the first drop in factory orders in four months. Excluding the transportation sector, orders for factory goods rose 0.7% in May. Excluding the defense sector, orders were down 0.6%. Shipments of factory goods rose 1.0% in May. Inventories increased 0.3%, while unfilled orders rose 0.9%. Orders for durable goods fell a revised 2.4% in May, up from the initial estimate of a 2.8% drop. Orders for nondurable goods increased 1.6%.
The housing market weakened further in May, with contract signings on sales of existing homes falling 3.5%, the National Association of Realtors reported Tuesday. Pending sales are down 13.3% compared with a year earlier, and are down 21% from the peak year in 2005. Pending sales fell 8.9% in the Midwest, and 7.6% in the South. Pending sales rose 5.6% in the West and 3.8% in the Northeast.
Benjamin Franklin: “Those who desire to give up freedom in order to gain security will not have, nor do they deserve, either one.”
Soren Kierkegaard: “People demand freedom of speech as a compensation for the freedom of thought which they seldom use.”
Jim Kingsland: "The big takeaway for me is the insideous nature of the dollar's declining buying power, which can only get worse as dollars flood every corner of the globe thanks to that modern marvel of technology - the good old printing press that Ben Bernanke loves so much. Why risk political suicide by raising taxes when the far easier Washingtonian solution is to print dollars to kingdom come? The inside the beltway types know full well that most people are too busy trying to make ends meet. There's no inclination for the masses to correlate that rising shadow-M3 equates with declining dollar buying power which results in a tax that isn't called a tax, but just another term from the dismal science to ignore: inflation. That's what I think of when I say the dollar is declining. You get less bang for the buck."
Venezuela has agreed to sell gasoline to Iran, the South American county's energy minister said in comments published Tuesday
Edmunds estimated the three Detroit-based automakers spent a combined $2.6 billion on sales incentives in the past month, while Japanese automakers spent $823 million.
“In both the L.B.O. market and collateralized loan markets there are practices that are the equivalent of the reckless lending in subprime mortgages,” Nouriel Roubini said. “Subprime people will say it was a niche problem. That’s nonsense.”
August crude climbed 32 cents to close at $71.41 a barrel Tuesday, the contract's strongest close since early September. Natural gas declined by a penny to $6.75.
August gold fell $3.80 to close at $355.40 an ounce Tuesday. September silver fell by 5.5 cents to close at $12.685 an ounce, but September copper gained 1.8 cents to close at $3.545 a pound. That was its highest level since mid-May.
United Capital Markets, a leading broker in the asset-backed securities market, said on Tuesday that it suspended investor redemptions on four of its Horizon hedge funds after suffering losses. United Capital said the redemption halts for the Horizon Fund L.P., Horizon ABS Fund L.P., Horizon ABS Fund Ltd. and Horizon ABS Master Fund Ltd. funds are temporary and it does not plan to liquidate them. Credit spreads have widened dramatically across asset-backed securities, mortgage-backed securities and collateralized debt obligations as news broke about significant losses in a large hedge fund focused on the space, United Capital explained. The Horizon funds have cut their leverage and sold "a large amount" of cash securities in the market. Not to worry friends. The experts say the problem is "contained."
General Motors Corp.'s U.S. sales plunged 21.3 percent in June and Ford dropped 8.1 percent while Toyota reported a 10.2 percent sales surge compared with a year ago.
George Carlin: “I do this real moron thing, it's called thinking, and I'm not a very good Amercian because I like to form my own opionions.”
Albert Einstein: “For those who would joyously march in rank and file, they have already earned my contempt, for they were given a large brain by accident when a spinal chord would have sufficed.”
John Hussman: " Investors need not take market risk at all times (or even a majority of the time) to capture the long-term return of the stock market. What is needed most is the avoidance of deep losses. It also helps to be willing to accept market exposure when valuations are depressed and other investors are bearish - particularly when yield pressures are falling."
Brett Steenbarger: "We've had four consecutive days of strong NYSE TICK, with my cumulative Adjusted TICK measure averaging over 500 per day over that period. Interestingly, going back to 2004 (N = 870 trading days), when we've had four consecutive up days in the TICK, the next five days in the S&P 500 Index (SPY) have averaged a loss of -.07% (39 up, 41 down). When the Adjusted TICK over those four days has averaged over 500, however, the next five days in SPY have averaged a healthy gain of .50% (9 up, 6 down). When the Adjusted TICK has averaged below 500, the next five days have averaged a loss of -.20% (30 up, 35 down). As we saw on Monday, it's difficult to fade a market in which large traders are persistently lifting offers across a broad range of stocks."
"The 'feel' of the consumer spending trend might best be characterized as slow, choppy and uncertain," said Michael Niemira, chief economist for ICSC. "Though more retailers seemingly share this view, we continue to believe that slower spending trends have been largely in place since February."
Teck Cominco agreed to buy Aur Resources for C$4.1 billion ($3.89 billion) in cash and shares. Aur shareholders will receive C$41.00 or 0.8749 of a Teck Class B subordinate voting share per Aur common share. The offer represents a premium of 29% based on the 20-day volume weighted average closing prices of the companies on June 29, according to Teck Cominco.
Danone agreed to sell its biscuit business to U.S. rival Kraft for 5.3 billion euros ($7.2 billion) in cash.
The American Bankers Association, in its quarterly survey of consumer loans, reported today that late payments on home equity loans rose to 2.15 percent in the January-to-March quarter. That was up sharply from 1.92 percent in the final quarter of last year and was the highest since the late summer of 2005.
Yahoo's advertising service, SmartAds, uses behavioral, demographic and geographic information to try to connect people with marketing that caters to their interests. Yahoo said it is its largest effort to cull information about its users.
Oil companies in Brazil will invest up to $133 billion between 2007 and 2016 in the exploration and production of crude and natural gas, according to official estimates released by the Energy and Mines Ministry.
The investment plans of oil companies operating in Brazil, led by state-run Petrobras, are contained in the 2007-2016 Ten-Year Plan for Energy Expansion.
Rio Tinto Iron Ore Group CEO Sam Walsh said the iron ore market is "extremely tight." He told analysts the company "quite frankly, can't meet demand."
India's rupee rose, in the biggest quarterly gain in 3 1/2 decades, as the world's second-fastest pace of economic growth and a $1 trillion stock market attracted overseas investors. The currency gained 6.8 percent this quarter as the government allowed the rupee to advance to make imports cheaper. India's current account showed a surplus, for the first time in a year, in the three months through March, as software exports increased and oil imports slowed, a report showed yesterday.
Higher gas prices, dry weather in parts of the United States, strong consumer demand and higher feed prices are behind a five percent increase in Wisconsin retail food prices in the second quarter of the year. That's according to the Wisconsin Farm Bureau Federation's Market Basket survey, which showed that the average cost of 20 selected food items in 26 communities was $50.33--up $2.48 compared to the first quarter of 2007.
Coffeyville Resources, a 108,000 barrel-per-day refinery, sustained a sizable spill as its facilities were swamped with waters that rose more than 30 feet. The oil spill contaminated the floodwaters, sweeping dark, foul-smelling water into homes and businesses and turning roads into rushing streams. The spill also contaminated the Verdigris River, sparking fears about contamination of lakes downstream in Oklahoma, officials said. In addition, Flint Hills Resources LP, a unit of Koch Industries Inc., shut a gasoline-producing unit at its refinery in Corpus Christi, Texas, according to a report on a state Web site.
China's central bank said it will ``moderately'' tighten monetary policy to control investment and lending growth and prevent the economy overheating this year.
Steve Saville: "The central bank's purpose is NOT to set the price of credit at the CORRECT level (the correct level is where the price would be in the ABSENCE of the central bank). Instead, the main purpose of the central bank is to facilitate inflation by ensuring that the real price of credit remains at an artificially LOW level most of the time. That's why, after several decades of central banking, we have arrived at the point where there is an enormous and unprecedented global glut of credit (sometimes mistakenly referred to as a savings glut)."
The total value of construction put in place in May 2007 increased by 0.9% on a seasonally adjusted basis from April, and was down 2.8% year-over-year. However, excluding the impact of residential construction, which was down 0.8% from April and 17.3% year-over-year, the value of non-residential construction increased 2.5% from April, and was up 15.4% year over year.
Global mergers and acquisitions volume surged to $2.88 trillion in the first half of 2007 up 55% from the same period a year ago, according to Dealogic.
Orders for U.S.-made factory goods fell 0.5% in May, the Commerce Department estimated Tuesday. It was the first drop in factory orders in four months. Excluding the transportation sector, orders for factory goods rose 0.7% in May. Excluding the defense sector, orders were down 0.6%. Shipments of factory goods rose 1.0% in May. Inventories increased 0.3%, while unfilled orders rose 0.9%. Orders for durable goods fell a revised 2.4% in May, up from the initial estimate of a 2.8% drop. Orders for nondurable goods increased 1.6%.
The housing market weakened further in May, with contract signings on sales of existing homes falling 3.5%, the National Association of Realtors reported Tuesday. Pending sales are down 13.3% compared with a year earlier, and are down 21% from the peak year in 2005. Pending sales fell 8.9% in the Midwest, and 7.6% in the South. Pending sales rose 5.6% in the West and 3.8% in the Northeast.
Benjamin Franklin: “Those who desire to give up freedom in order to gain security will not have, nor do they deserve, either one.”
Soren Kierkegaard: “People demand freedom of speech as a compensation for the freedom of thought which they seldom use.”
Jim Kingsland: "The big takeaway for me is the insideous nature of the dollar's declining buying power, which can only get worse as dollars flood every corner of the globe thanks to that modern marvel of technology - the good old printing press that Ben Bernanke loves so much. Why risk political suicide by raising taxes when the far easier Washingtonian solution is to print dollars to kingdom come? The inside the beltway types know full well that most people are too busy trying to make ends meet. There's no inclination for the masses to correlate that rising shadow-M3 equates with declining dollar buying power which results in a tax that isn't called a tax, but just another term from the dismal science to ignore: inflation. That's what I think of when I say the dollar is declining. You get less bang for the buck."
Venezuela has agreed to sell gasoline to Iran, the South American county's energy minister said in comments published Tuesday
Edmunds estimated the three Detroit-based automakers spent a combined $2.6 billion on sales incentives in the past month, while Japanese automakers spent $823 million.
“In both the L.B.O. market and collateralized loan markets there are practices that are the equivalent of the reckless lending in subprime mortgages,” Nouriel Roubini said. “Subprime people will say it was a niche problem. That’s nonsense.”
August crude climbed 32 cents to close at $71.41 a barrel Tuesday, the contract's strongest close since early September. Natural gas declined by a penny to $6.75.
August gold fell $3.80 to close at $355.40 an ounce Tuesday. September silver fell by 5.5 cents to close at $12.685 an ounce, but September copper gained 1.8 cents to close at $3.545 a pound. That was its highest level since mid-May.
United Capital Markets, a leading broker in the asset-backed securities market, said on Tuesday that it suspended investor redemptions on four of its Horizon hedge funds after suffering losses. United Capital said the redemption halts for the Horizon Fund L.P., Horizon ABS Fund L.P., Horizon ABS Fund Ltd. and Horizon ABS Master Fund Ltd. funds are temporary and it does not plan to liquidate them. Credit spreads have widened dramatically across asset-backed securities, mortgage-backed securities and collateralized debt obligations as news broke about significant losses in a large hedge fund focused on the space, United Capital explained. The Horizon funds have cut their leverage and sold "a large amount" of cash securities in the market. Not to worry friends. The experts say the problem is "contained."
General Motors Corp.'s U.S. sales plunged 21.3 percent in June and Ford dropped 8.1 percent while Toyota reported a 10.2 percent sales surge compared with a year ago.
Monday, July 02, 2007
metals, currency, and oil
7/3/07 Metals, Currency, And Oil
Gold warehouse inventories fell by 100,862 troy ounces to stand at 7.35 million troy ounces as of 6/28, according to Nymex data. Silver supplies fell by 529,491 troy ounces to stand at 134.6 million troy ounces, while copper supplies fell to 22,123 short tons, down 224 short tons.
The price of platinum will probably rise 8% this year on investor and industrial demand, while a surplus of the metal is forecast to surge 40%, precious metals research company CPM Group said.
The average price of the metal used in vehicle pollution-control devices jumped 27% to $1,146.90 (Rs47,022) in 2006. The average this year has climbed to $1,248.95. Platinum futures reached a record $1,353.80 an ounce on 7 May. The surplus will increase to 897,000 ounces from 635,000 ounces in 2006, according to New York-based CPO Group.
Consumption probably will climb 6.5% this year, while supplies are expected to rise 5.3%, CPM Group said.
Last year, demand for the metal rose 11%, while production increased an estimated 3.1%, the research group said.
“Automotive use of palladium is projected to continue to increase this year, but growth in this sector may not be as robust as in previous years,” CPM said. “Palladium use in the electronics and dental sectors also are expected to increase this year, continuing the trend from last year.
Demand for rhodium will outpace supplies this year, CPM said. The average price rose 50% in the five months ended May to $5,852 an ounce. The metal more than doubled last year from 2005. The deficit of the metal will widen to 24,323 ounces this year from 112,300 in 2006, CPM said. Rhodium is used in auto catalysts, as an alloy of platinum in glass-making equipment, and in some chemical-process catalysts, plating and electronic components.
The New Zealand dollar hit another record high Saturday against the US dollar, despite the Reserve Bank's attempts to bring down the currency.
"A prolonged divergence between headline and core US inflation may not only prove negative for the US dollar but will resurrect tendencies of stagflation fears, thus highlighting the Fed's policy dilemma,'' said Ashraf Laidi, chief FX strategist at CMC Markets. "This is especially the case as housing and rising energy prices weigh on consumer spending,'' Laidi added.
PetroChina will import some 40 percent of the crude oil it processes in 2007, up from last year’s 30 percent, a company official said on Saturday. The company is expected to process 100-120 million tonnes of crude this year, 10-20 million tonnes higher than in 2006, said Zhang Hong, a senior official with PetroChina’s refining and marketing unit. This would indicate 40 million to 48 million tonnes of imports this year for China’s top oil and gas producer alone.
Pakistan's State Bank’s data shows that the country’s reserves stood at $15.182 billion on June 23, 2007, but the bankers said the banks received a payment of around $250 million through the sale of PICIC and $100-$150 million of telecom sector in last few days, which were not included in the total reserves of the central bank.
“The total reserves had touched $15.5 billion in the outgoing fiscal,” a banker said. “The reserve would continue its upward trend during 2007-08 following the undergoing privatisation programme of the federal government.”
The central bank will have to receive $650 million against the Global Depository Receipt (GDR) of the United Bank Ltd (UBL).
Global Tower Partners, a U.S. wireless tower operator, is to be bought by a consortium of infrastructure funds managed by members of Australia's Macquarie Group. New York-based fund Macquarie Infrastructure Partners and Sydney-based Macquarie Communications Infrastructure Group bought the Boca Raton, Florida, based provider of outsourced antennae site facilities from buyout group Blackstone . The consortium said in a press statement that the deal gave Global Tower an enterprise value of $1.4 billion.
Wesfarmers Ltd. , which owns Australia's largest hardware chain, has agreed to buy retailer Coles Group Ltd. for A$20.7 billion ($17.7 billion) in cash and stock, in the country's biggest takeover.
Kraft, the maker of Oreo cookies and Ritz crackers, is understood to be in talks to buy the biscuit and cereal products division of France’s Danone, owner of the LU, Prince and Tuc biscuit brands.
Confidence among Japan's largest manufacturers held near a two-year high and companies said they're spending more this year, paving the way for the central bank to raise interest rates for the third time in seven years.
GSO Capital Partners has agreed to acquire Reddy Ice Holdings Inc. in a cash transaction with a total value of about $1.1 billion, the parties said. Terms call for stockholders of Dallas-based Reddy Ice to receive $31.25 for each common share, a premium of nearly 10% over the shares' June 29 closing share.
More than 2.8 million Wii consoles have sold in the U.S. since the November debut, according to the NPD Group, a market research company. That's more than double the number of PlayStation 3 consoles sold. And Nintendo plans to sell 14 million worldwide in the current fiscal year, which ends in March.
PetroChina is ready to start operating a crude oil pipeline in northwestern China, part of a pipeline network to deliver crude from the oil-rich west to the energy-hungry east, said its parent company China National Petroleum Corp. Monday.
The 1,842-kilometer pipeline has a capacity to transport 20 million metric tons of crude oil a year, or 401,640 barrels a day, said CNPC in a posting on its Web site.
It originates from Urumqi, the capital of the northwest Xinjiang Autonomous Region, and extends to Lanzhou, the capital of neighboring Gansu province, where a 200,000 barrel-a-day CNPC refinery is located.
The pipeline will link with the transnational Kazakh-China crude pipeline in Xinjiang and will be extended eastward via a separate pipeline currently being built to Zhengzhou, the capital of Henan province and Changsha, the capital of Hunan province, it said.
Investors will pay $1,589 per square foot, or $510 million, for Manhattan's 450 Park Ave. The deal is believed to be the most expensive on a per-square-foot basis for a U.S. office building.
Advertising forecasters have downgraded prospects for the US, challenging expectations of a boost to the marketing industry from the presidential election race and the 2008 Beijing summer Olympics.
Zenith Optimedia, the international media buyer, on Monday shaved its 2007 expectations of US advertising expenditure growth to 3.3 per cent at constant currencies.
Five members of the U.S. military were killed in Baghdad and the western province of al-Anbar yesterday. Some 108 U.S. service members died in Iraq in June. More than 3,570 U.S. personnel have died in Iraq. More than 26,000 have been wounded, at least 11,830 of them so seriously that they couldn't return to duty, according to the Department of Defense.
Jim Rogers, who predicted the start of the global commodities rally in 1999, said he's sold out of all emerging markets with the exception of China because they're ``over-exploited.'' ``I'm hoping when the next big correction comes I'm smart enough to buy some of them back,'' Rogers, chairman of New York- based Beeland Interests Inc., said in an interview in Singapore today. ``They're all over-exploited, so I've sold out.''
Chicago-based Sheldon Good & Co. says it expects to run 44 residential auctions this year, twice as many as in 2004. Among the recent sales: 21 condominiums in the New York City area and fractional shares in a Jackson Hole, Wyo., resort. Dallas-based Hudson & Marshall of Texas Inc., which specializes in selling foreclosed single-family homes, auctioned 300 properties in Texas and 300 others in California during June. In July, the company plans to auction 400 bank-owned properties in northern California and 400 others in Ohio and Pennsylvania.
Manor Care announced it agreed to be acquired by private-equity firm Carlyle Group for about $6.3 billion. Under the terms of the deal, Manor Care shareholders will receive $67 a share in cash. The companies said this represents a 20% premium to Manor Care's closing stock price of $55.75 on April 10, prior to the company's April 11 announcement it was evaluating strategic alternatives. Manor Care provides care for patients and residents through a network of more than 500 skilled nursing and rehabilitation centers.
An assistant attorney general at the Justice Department announced her resignation on Friday, becoming the seventh official to quit the department since the Democratic-led Congress launched an investigation in March into the firing of nine federal prosecutors. Rachel Brand, assistant attorney general for legal policy, said she would step down on July 9. No reason was given.
Apple Inc. sold about 525,000 iPhones at Apple and AT&T Inc. stores in the first weekend since its June 29 launch, the Los Angeles Times reported on Monday, citing an analyst.
China will use up to 350 million tons of oil this year, ten million tons more than last year, said an expert with the country's top economic planner. Jiang said domestic oil production was increasing at around 1.5 percent a year, whereas oil consumption had jumped by about 8 percent a year since 2002, compelling China to import more. As recently as ten years ago, he said, the country had been a net oil exporter but in 2006, nearly 50 percent of China's oil consumption was imported from abroad.
India will receive gas from Iran via a multi-billion-dollar pipeline through Pakistan in four years, an Iranian oil official said in New Delhi.
"The gas supply will start in 2011," said Ghanimi Fard, the Iranian oil ministry`s special representative, according to a report Saturday in India`s Business Standard newspaper.
Bank of America Corp. strategist Thomas McManus said he expects the S&P 500 to reach 1590 in the next 12 months as earnings growth reaccelerates.
U.S. June ISM manufacturing index 56.0% vs 55.0% in May. The new-orders index rose to 60.3% from 59.6% in May. It's the highest since April 2006.
The production index rose to 62.9% from 58.3% in May. It's the highest since February 2004. The prices-paid index fell to 68% from 71% in May.
Rio Tinto made another 52-week high at $319+.
A senior government economist says China's trade surplus for the first half of this year is expected to top $100 billion, a state news agency said Monday. Total trade with the United States for the first half is expected to top $1 trillion, up 24 percent from the year-earlier period, the Xinhua News Agency said, citing Yao Jingyuan, chief economist for the National Bureau of Statistics. "The trade surplus reached $85.7 billion in January-May, and for the first half of the year will exceed $100 billion," Xinhua said, citing Yao.
The chairman of the Senate Judiciary Committee, Patrick Leahy, said Sunday that he will attempt to cite the White House for criminal contempt of Congress if it does not turn over documents related to the firing of nine federal prosecutors.
The British pound touched a 26-year high of $2.0146.
Walgreen agreed to acquire Option Care Inc. for $19.50 a share in a deal valued at $850 million including debt. The offer represents at 27% premium over Option Care's closing share price on Friday of $15.40. Option Care, based in Buffalo Grove, Ill., provides specialty pharmacy and home infusion services from a network of more than 100 pharmacies in 34 states.
UBS AG, Europe's largest bank by assets, raised its 2007 forecast for West Texas Intermediate by 6.5 percent to $65 a barrel from $61 because of low inventories and strong demand.
August gold climbed $8.30 to close at $659.20 an ounce Monday. September silver rose 2.1%, or 26.7 cents, to close at $12.74 an ounce. September copper rose 2.2%, or 7.65 cents, to finish at $3.527 a pound, its highest level since mid-May.
August crude climbed 41 cents to close at $71.09 a barrel Monday, marking the contract's highest close since Sept. 8, 2006. August natural gas closed at $6.764 per million British thermal units, down 0.9 cent.
Gold warehouse inventories fell by 100,862 troy ounces to stand at 7.35 million troy ounces as of 6/28, according to Nymex data. Silver supplies fell by 529,491 troy ounces to stand at 134.6 million troy ounces, while copper supplies fell to 22,123 short tons, down 224 short tons.
The price of platinum will probably rise 8% this year on investor and industrial demand, while a surplus of the metal is forecast to surge 40%, precious metals research company CPM Group said.
The average price of the metal used in vehicle pollution-control devices jumped 27% to $1,146.90 (Rs47,022) in 2006. The average this year has climbed to $1,248.95. Platinum futures reached a record $1,353.80 an ounce on 7 May. The surplus will increase to 897,000 ounces from 635,000 ounces in 2006, according to New York-based CPO Group.
Consumption probably will climb 6.5% this year, while supplies are expected to rise 5.3%, CPM Group said.
Last year, demand for the metal rose 11%, while production increased an estimated 3.1%, the research group said.
“Automotive use of palladium is projected to continue to increase this year, but growth in this sector may not be as robust as in previous years,” CPM said. “Palladium use in the electronics and dental sectors also are expected to increase this year, continuing the trend from last year.
Demand for rhodium will outpace supplies this year, CPM said. The average price rose 50% in the five months ended May to $5,852 an ounce. The metal more than doubled last year from 2005. The deficit of the metal will widen to 24,323 ounces this year from 112,300 in 2006, CPM said. Rhodium is used in auto catalysts, as an alloy of platinum in glass-making equipment, and in some chemical-process catalysts, plating and electronic components.
The New Zealand dollar hit another record high Saturday against the US dollar, despite the Reserve Bank's attempts to bring down the currency.
"A prolonged divergence between headline and core US inflation may not only prove negative for the US dollar but will resurrect tendencies of stagflation fears, thus highlighting the Fed's policy dilemma,'' said Ashraf Laidi, chief FX strategist at CMC Markets. "This is especially the case as housing and rising energy prices weigh on consumer spending,'' Laidi added.
PetroChina will import some 40 percent of the crude oil it processes in 2007, up from last year’s 30 percent, a company official said on Saturday. The company is expected to process 100-120 million tonnes of crude this year, 10-20 million tonnes higher than in 2006, said Zhang Hong, a senior official with PetroChina’s refining and marketing unit. This would indicate 40 million to 48 million tonnes of imports this year for China’s top oil and gas producer alone.
Pakistan's State Bank’s data shows that the country’s reserves stood at $15.182 billion on June 23, 2007, but the bankers said the banks received a payment of around $250 million through the sale of PICIC and $100-$150 million of telecom sector in last few days, which were not included in the total reserves of the central bank.
“The total reserves had touched $15.5 billion in the outgoing fiscal,” a banker said. “The reserve would continue its upward trend during 2007-08 following the undergoing privatisation programme of the federal government.”
The central bank will have to receive $650 million against the Global Depository Receipt (GDR) of the United Bank Ltd (UBL).
Global Tower Partners, a U.S. wireless tower operator, is to be bought by a consortium of infrastructure funds managed by members of Australia's Macquarie Group. New York-based fund Macquarie Infrastructure Partners and Sydney-based Macquarie Communications Infrastructure Group bought the Boca Raton, Florida, based provider of outsourced antennae site facilities from buyout group Blackstone . The consortium said in a press statement that the deal gave Global Tower an enterprise value of $1.4 billion.
Wesfarmers Ltd. , which owns Australia's largest hardware chain, has agreed to buy retailer Coles Group Ltd. for A$20.7 billion ($17.7 billion) in cash and stock, in the country's biggest takeover.
Kraft, the maker of Oreo cookies and Ritz crackers, is understood to be in talks to buy the biscuit and cereal products division of France’s Danone, owner of the LU, Prince and Tuc biscuit brands.
Confidence among Japan's largest manufacturers held near a two-year high and companies said they're spending more this year, paving the way for the central bank to raise interest rates for the third time in seven years.
GSO Capital Partners has agreed to acquire Reddy Ice Holdings Inc. in a cash transaction with a total value of about $1.1 billion, the parties said. Terms call for stockholders of Dallas-based Reddy Ice to receive $31.25 for each common share, a premium of nearly 10% over the shares' June 29 closing share.
More than 2.8 million Wii consoles have sold in the U.S. since the November debut, according to the NPD Group, a market research company. That's more than double the number of PlayStation 3 consoles sold. And Nintendo plans to sell 14 million worldwide in the current fiscal year, which ends in March.
PetroChina is ready to start operating a crude oil pipeline in northwestern China, part of a pipeline network to deliver crude from the oil-rich west to the energy-hungry east, said its parent company China National Petroleum Corp. Monday.
The 1,842-kilometer pipeline has a capacity to transport 20 million metric tons of crude oil a year, or 401,640 barrels a day, said CNPC in a posting on its Web site.
It originates from Urumqi, the capital of the northwest Xinjiang Autonomous Region, and extends to Lanzhou, the capital of neighboring Gansu province, where a 200,000 barrel-a-day CNPC refinery is located.
The pipeline will link with the transnational Kazakh-China crude pipeline in Xinjiang and will be extended eastward via a separate pipeline currently being built to Zhengzhou, the capital of Henan province and Changsha, the capital of Hunan province, it said.
Investors will pay $1,589 per square foot, or $510 million, for Manhattan's 450 Park Ave. The deal is believed to be the most expensive on a per-square-foot basis for a U.S. office building.
Advertising forecasters have downgraded prospects for the US, challenging expectations of a boost to the marketing industry from the presidential election race and the 2008 Beijing summer Olympics.
Zenith Optimedia, the international media buyer, on Monday shaved its 2007 expectations of US advertising expenditure growth to 3.3 per cent at constant currencies.
Five members of the U.S. military were killed in Baghdad and the western province of al-Anbar yesterday. Some 108 U.S. service members died in Iraq in June. More than 3,570 U.S. personnel have died in Iraq. More than 26,000 have been wounded, at least 11,830 of them so seriously that they couldn't return to duty, according to the Department of Defense.
Jim Rogers, who predicted the start of the global commodities rally in 1999, said he's sold out of all emerging markets with the exception of China because they're ``over-exploited.'' ``I'm hoping when the next big correction comes I'm smart enough to buy some of them back,'' Rogers, chairman of New York- based Beeland Interests Inc., said in an interview in Singapore today. ``They're all over-exploited, so I've sold out.''
Chicago-based Sheldon Good & Co. says it expects to run 44 residential auctions this year, twice as many as in 2004. Among the recent sales: 21 condominiums in the New York City area and fractional shares in a Jackson Hole, Wyo., resort. Dallas-based Hudson & Marshall of Texas Inc., which specializes in selling foreclosed single-family homes, auctioned 300 properties in Texas and 300 others in California during June. In July, the company plans to auction 400 bank-owned properties in northern California and 400 others in Ohio and Pennsylvania.
Manor Care announced it agreed to be acquired by private-equity firm Carlyle Group for about $6.3 billion. Under the terms of the deal, Manor Care shareholders will receive $67 a share in cash. The companies said this represents a 20% premium to Manor Care's closing stock price of $55.75 on April 10, prior to the company's April 11 announcement it was evaluating strategic alternatives. Manor Care provides care for patients and residents through a network of more than 500 skilled nursing and rehabilitation centers.
An assistant attorney general at the Justice Department announced her resignation on Friday, becoming the seventh official to quit the department since the Democratic-led Congress launched an investigation in March into the firing of nine federal prosecutors. Rachel Brand, assistant attorney general for legal policy, said she would step down on July 9. No reason was given.
Apple Inc. sold about 525,000 iPhones at Apple and AT&T Inc. stores in the first weekend since its June 29 launch, the Los Angeles Times reported on Monday, citing an analyst.
China will use up to 350 million tons of oil this year, ten million tons more than last year, said an expert with the country's top economic planner. Jiang said domestic oil production was increasing at around 1.5 percent a year, whereas oil consumption had jumped by about 8 percent a year since 2002, compelling China to import more. As recently as ten years ago, he said, the country had been a net oil exporter but in 2006, nearly 50 percent of China's oil consumption was imported from abroad.
India will receive gas from Iran via a multi-billion-dollar pipeline through Pakistan in four years, an Iranian oil official said in New Delhi.
"The gas supply will start in 2011," said Ghanimi Fard, the Iranian oil ministry`s special representative, according to a report Saturday in India`s Business Standard newspaper.
Bank of America Corp. strategist Thomas McManus said he expects the S&P 500 to reach 1590 in the next 12 months as earnings growth reaccelerates.
U.S. June ISM manufacturing index 56.0% vs 55.0% in May. The new-orders index rose to 60.3% from 59.6% in May. It's the highest since April 2006.
The production index rose to 62.9% from 58.3% in May. It's the highest since February 2004. The prices-paid index fell to 68% from 71% in May.
Rio Tinto made another 52-week high at $319+.
A senior government economist says China's trade surplus for the first half of this year is expected to top $100 billion, a state news agency said Monday. Total trade with the United States for the first half is expected to top $1 trillion, up 24 percent from the year-earlier period, the Xinhua News Agency said, citing Yao Jingyuan, chief economist for the National Bureau of Statistics. "The trade surplus reached $85.7 billion in January-May, and for the first half of the year will exceed $100 billion," Xinhua said, citing Yao.
The chairman of the Senate Judiciary Committee, Patrick Leahy, said Sunday that he will attempt to cite the White House for criminal contempt of Congress if it does not turn over documents related to the firing of nine federal prosecutors.
The British pound touched a 26-year high of $2.0146.
Walgreen agreed to acquire Option Care Inc. for $19.50 a share in a deal valued at $850 million including debt. The offer represents at 27% premium over Option Care's closing share price on Friday of $15.40. Option Care, based in Buffalo Grove, Ill., provides specialty pharmacy and home infusion services from a network of more than 100 pharmacies in 34 states.
UBS AG, Europe's largest bank by assets, raised its 2007 forecast for West Texas Intermediate by 6.5 percent to $65 a barrel from $61 because of low inventories and strong demand.
August gold climbed $8.30 to close at $659.20 an ounce Monday. September silver rose 2.1%, or 26.7 cents, to close at $12.74 an ounce. September copper rose 2.2%, or 7.65 cents, to finish at $3.527 a pound, its highest level since mid-May.
August crude climbed 41 cents to close at $71.09 a barrel Monday, marking the contract's highest close since Sept. 8, 2006. August natural gas closed at $6.764 per million British thermal units, down 0.9 cent.
Sunday, July 01, 2007
A New Quarter Begins
7/2/07 A New Quarter Begins
Private equity group Carlyle is poised to launch an $8 billion bid for Britain's Virgin Media , the cable company whose largest shareholder is Richard Branson, the Sunday Telegraph newspaper said, citing City sources.
Middle Eastern investment funds are targeting Jaguar and Land Rover, the British luxury car brands that U.S. owner Ford Motor Co. is considering selling, the Observer newspaper said on Sunday. Abu Dhabi's Mubadala Development Company and Dubai International Capital have instructed financial advisers to drawn up plans for bidding for one or both companies, the newspaper said, without citing sources. A small group of private equity funds this week received information on Land Rover and Jaguar in preparation for a possible sale of Ford Motor’s two UK luxury brands, the Financial Times has learned. Ford’s bankers – Goldman Sachs, Morgan Stanley and HSBC – sent out limited financial data to a small group of private equity funds in recent days on the two brands, which the lossmaking US carmaker hopes to sell as a unit.
The Citgo subsidiary of Venezuela's national oil company has five refineries in the U.S. experts say could be targeted for seizure if a stalemate prompts one or both U.S. oil majors to seek recompense through international arbitration.
Britain raised its terrorism threat alert to its highest level after two men crashed an S.U.V. into doors at Glasgow Airport and turned the vehicle into a fireball.
As Putin visits Bush in Maine, one area of conversation could center on
Russia beginning mass production of Topol-M strategic missiles, the country’s First Deputy Prime Minister Sergei Ivanov said June 26.
“We are now moving on to a new and very important rearmament stage for both our nuclear strategic forces and our tactical complexes,” he said at the plant at Votkinsk in Udmurtia, some 1,000 kilometers (620 miles) east of Moscow, quoted by the Interfax news agency.
“These are not prototypes but mass production,” he said.
“I am talking of stationary Topol-M missile complexes but also of mobile ones which can be fitted with different types of warhead, as well as Iskander-M missiles.”
The Topol-M is known to NATO as the SS-27 and is a three-stage intercontinental ballistic missile with a range of 10,000 kilometers (6,200 miles) which can be deployed on both stationary and mobile launch platforms.
It is 22.7 meters (74 feet) long with a diameter of 1.95 meters (6.4 feet) and weighs 47 tons.
The Iskander-M is a short range tactical missile known to NATO as the SS-26.
OAO Rosneft, Russia's largest oil company, plans to reduce its debt by 40 percent and expand refining capacity ninefold, Chief Executive Officer Sergei Bogdanchikov said.
Mike Burk: "Seasonally the first 4 trading days of July during the 3rd year of the Presidential Cycle have been one of the strongest weeks of the year. Since 1931 the S&P 500 (SPX) has been up 89% of the time with an average gain of over 1.5%. The NASDAQ hasn't been too shabby either up 73% of the time with an average gain of 1.19%...I expect the major indices to be higher on Friday July 6 than they were on Friday June 29."
Rep. Jim McDermott (D-WA) declared in an address on the House floor Thursday night that he was in favor of impeaching the vice president.
"It is time for a new exit strategy, one that removes the Vice President of the United States from office, voluntarily, if he chooses, but by impeachment if he stonewalls," said the Seattle Democrat and Progressive Caucus member. "I have struggled mightily with this matter for a long time...Since the President permits the flagrant disregard of the Constitution, it is up to the Congress to act and defend the American people. With each new revelation, America has seen only glints of what has been done totally in secret."
The rate of construction of oil tankers for Chinese shipping lines is falling behind the rate of increase in oil imports, which may pose a threat to the country's energy security, a China Ocean Shipping (Group) Co (COSCO) official said. The manager of the COSCO group shipping research department, Kong Fanhua, told a forum here that only 20 pct of China's seaborne oil imports had been carried by Chinese shipping lines last year. Kong said China's tanker fleet did not meet the country's needs, and that more ships were needed.
Chavez welcomed the presence of Russian oil and gas companies on the Venezuelan market and unveiled plans for cooperation in the development of several deposits whose amounts of oil are estimated at about 300 billion tons. According to Chavez, there were huge gas fields in the Caribbean, about 200 trillion cubic meters. "We discussed with President Putin the possibility of organizing a meeting of specialists, so that they could assess projects we have outlined," he said. Chavez said that Russia oil company Lukoil and gas giant Gazprom had promised to help develop the oil and gas industry in Venezuela. "Gazprom is also working with us in the interests of the Caribbean Basin, where explored fields have reserves of around 200trillion cubic meters," he said.
The world’s largest natural gas company is planning to enter the Irish electricity market as part of an overall expansion into Europe.
The state-owned Russian gas monopoly, Gazprom, which doubled its profits to $23.75 billion last year, announced plans last Friday to increase its business in five European countries, including Ireland and France.
Gazprom supplies a quarter of Europe’s gas and plans to build a power plant in Germany to reach customers directly.
Almost 65 percent of the bonds in indexes that track subprime mortgage debt don't meet the ratings criteria in place when they were sold, according to data compiled by Bloomberg. That may just be the beginning. Downgrades by S&P, Moody's and Fitch would force hundreds of investors to sell holdings, roiling the $800 billion market for securities backed by subprime mortgages and $1 trillion of collateralized debt obligations, the fastest growing part of the financial markets. "You'll see massive losses from banks, insurance companies and pension managers,'' said Joshua Rosner, a managing director at investment research firm Graham Fisher & Co. in New York and co-author of a study last month that said S&P, Moody's and Fitch understate the risks of subprime mortgage bonds. ``The longer they wait, the worse it's going to be.'' Rosner estimates that collateralized debt obligations, which have packaged thousands of bonds and derivatives into new securities, will lose $125 billion. Institutional Risk Analytics, a Hawthorne, California-based company that writes computer programs for accounting firms, says 25 percent of the face value of CDOs is in jeopardy, or $250 billion. Losses may rival the savings and loan crisis of the 1980s and 1990s.
In British pubs, theaters, shopping malls and other covered public places, smoking is no longer allowed.
Private equity group Carlyle is poised to launch an $8 billion bid for Britain's Virgin Media , the cable company whose largest shareholder is Richard Branson, the Sunday Telegraph newspaper said, citing City sources.
Middle Eastern investment funds are targeting Jaguar and Land Rover, the British luxury car brands that U.S. owner Ford Motor Co. is considering selling, the Observer newspaper said on Sunday. Abu Dhabi's Mubadala Development Company and Dubai International Capital have instructed financial advisers to drawn up plans for bidding for one or both companies, the newspaper said, without citing sources. A small group of private equity funds this week received information on Land Rover and Jaguar in preparation for a possible sale of Ford Motor’s two UK luxury brands, the Financial Times has learned. Ford’s bankers – Goldman Sachs, Morgan Stanley and HSBC – sent out limited financial data to a small group of private equity funds in recent days on the two brands, which the lossmaking US carmaker hopes to sell as a unit.
The Citgo subsidiary of Venezuela's national oil company has five refineries in the U.S. experts say could be targeted for seizure if a stalemate prompts one or both U.S. oil majors to seek recompense through international arbitration.
Britain raised its terrorism threat alert to its highest level after two men crashed an S.U.V. into doors at Glasgow Airport and turned the vehicle into a fireball.
As Putin visits Bush in Maine, one area of conversation could center on
Russia beginning mass production of Topol-M strategic missiles, the country’s First Deputy Prime Minister Sergei Ivanov said June 26.
“We are now moving on to a new and very important rearmament stage for both our nuclear strategic forces and our tactical complexes,” he said at the plant at Votkinsk in Udmurtia, some 1,000 kilometers (620 miles) east of Moscow, quoted by the Interfax news agency.
“These are not prototypes but mass production,” he said.
“I am talking of stationary Topol-M missile complexes but also of mobile ones which can be fitted with different types of warhead, as well as Iskander-M missiles.”
The Topol-M is known to NATO as the SS-27 and is a three-stage intercontinental ballistic missile with a range of 10,000 kilometers (6,200 miles) which can be deployed on both stationary and mobile launch platforms.
It is 22.7 meters (74 feet) long with a diameter of 1.95 meters (6.4 feet) and weighs 47 tons.
The Iskander-M is a short range tactical missile known to NATO as the SS-26.
OAO Rosneft, Russia's largest oil company, plans to reduce its debt by 40 percent and expand refining capacity ninefold, Chief Executive Officer Sergei Bogdanchikov said.
Mike Burk: "Seasonally the first 4 trading days of July during the 3rd year of the Presidential Cycle have been one of the strongest weeks of the year. Since 1931 the S&P 500 (SPX) has been up 89% of the time with an average gain of over 1.5%. The NASDAQ hasn't been too shabby either up 73% of the time with an average gain of 1.19%...I expect the major indices to be higher on Friday July 6 than they were on Friday June 29."
Rep. Jim McDermott (D-WA) declared in an address on the House floor Thursday night that he was in favor of impeaching the vice president.
"It is time for a new exit strategy, one that removes the Vice President of the United States from office, voluntarily, if he chooses, but by impeachment if he stonewalls," said the Seattle Democrat and Progressive Caucus member. "I have struggled mightily with this matter for a long time...Since the President permits the flagrant disregard of the Constitution, it is up to the Congress to act and defend the American people. With each new revelation, America has seen only glints of what has been done totally in secret."
The rate of construction of oil tankers for Chinese shipping lines is falling behind the rate of increase in oil imports, which may pose a threat to the country's energy security, a China Ocean Shipping (Group) Co (COSCO) official said. The manager of the COSCO group shipping research department, Kong Fanhua, told a forum here that only 20 pct of China's seaborne oil imports had been carried by Chinese shipping lines last year. Kong said China's tanker fleet did not meet the country's needs, and that more ships were needed.
Chavez welcomed the presence of Russian oil and gas companies on the Venezuelan market and unveiled plans for cooperation in the development of several deposits whose amounts of oil are estimated at about 300 billion tons. According to Chavez, there were huge gas fields in the Caribbean, about 200 trillion cubic meters. "We discussed with President Putin the possibility of organizing a meeting of specialists, so that they could assess projects we have outlined," he said. Chavez said that Russia oil company Lukoil and gas giant Gazprom had promised to help develop the oil and gas industry in Venezuela. "Gazprom is also working with us in the interests of the Caribbean Basin, where explored fields have reserves of around 200trillion cubic meters," he said.
The world’s largest natural gas company is planning to enter the Irish electricity market as part of an overall expansion into Europe.
The state-owned Russian gas monopoly, Gazprom, which doubled its profits to $23.75 billion last year, announced plans last Friday to increase its business in five European countries, including Ireland and France.
Gazprom supplies a quarter of Europe’s gas and plans to build a power plant in Germany to reach customers directly.
Almost 65 percent of the bonds in indexes that track subprime mortgage debt don't meet the ratings criteria in place when they were sold, according to data compiled by Bloomberg. That may just be the beginning. Downgrades by S&P, Moody's and Fitch would force hundreds of investors to sell holdings, roiling the $800 billion market for securities backed by subprime mortgages and $1 trillion of collateralized debt obligations, the fastest growing part of the financial markets. "You'll see massive losses from banks, insurance companies and pension managers,'' said Joshua Rosner, a managing director at investment research firm Graham Fisher & Co. in New York and co-author of a study last month that said S&P, Moody's and Fitch understate the risks of subprime mortgage bonds. ``The longer they wait, the worse it's going to be.'' Rosner estimates that collateralized debt obligations, which have packaged thousands of bonds and derivatives into new securities, will lose $125 billion. Institutional Risk Analytics, a Hawthorne, California-based company that writes computer programs for accounting firms, says 25 percent of the face value of CDOs is in jeopardy, or $250 billion. Losses may rival the savings and loan crisis of the 1980s and 1990s.
In British pubs, theaters, shopping malls and other covered public places, smoking is no longer allowed.
Subscribe to:
Posts (Atom)