Tuesday, September 30, 2008

Interesting thread

Fed Pumps Further $630 Billion Into Financial System

"Basically the huge currency swaps are portrayed as "world wide demand for dollars" when actually the US needs the foreign currency." Ablebonus @ 2008-09-30 02:38:39

US, Europe, Japan planned dollar rescue: Nikkei

TOKYO - The United States, Europe and Japan planned joint intervention to rescue the dollar when it was plunging in March at the time US investment bank Bear Stearns collapsed, the Nikkei business newspaper reported.

Officials from the US Treasury Department, Japan's Finance Ministry and the European Central Bank reportedly drew up a currency contingency plan over the weekend of March 15-16, the Nikkei said, citing sources familiar with the situation.


The officials did not specify levels for initiating the dollar rescue plan, but in the event of a free-fall they agreed to coordinate aggressive buying of the greenback and sell yen JPY and euros EUR, the newspaper said.

‘If downside risks to the dollar emerge from here on, the market will keep in mind the possibility of similar action by authorities,’ said Takahide Nagasaki, chief foreign exchange strategist for Daiwa Securities SMBC.


Even as the dollar slid after the flare-up of the credit market turmoil last August, there had been a perception among market players that US authorities were willing to tolerate falls in the dollar in a policy of ‘benign neglect’, to help support US exports as the economy faltered.

But market players detected a shift in US officials' stance towards the dollar in June when Federal Reserve Chairman Ben Bernanke issued a rare warning on the inflation risk posed by a weak dollar, and Treasury Secretary Henry Paulson declined to rule out intervening in currency markets.

Under the intervention framework, Japan was to supply yen through currency swaps. The plan also called for using a previously established swap mechanism between the United States and Europe.



"That's quite a statement leraconteur.

However, that would explain why LEH and AIG blewup is the fed was unable to lend to keep them afloat. It would explain why the investment banks were trying to latch onto depositors funds. It would explain the type of scenario that could be explained to congress and leave them silenced and mouth agape. It would explain why this bill has the support it does in the face of 300 to 1 constituents support. It would explain why many (Bush, McCaine, Obama, democrats) keep saying "it will pass". It would explain the need for congressional martial law in the house. It would explain the large swaps that are increasing in size and frequency." 127001 @ 2008-09-30 06:51:54

Banking crash hits Europe as ECB loses traction

"The ECB is no longer able to inject liquidity because the money is just coming back to them again. This is extremely serious. If monetary policy is no longer working, there is a risk that the whole system will blow up in days," he said.

Currency Swap

Friday, September 26, 2008

Monday, September 15, 2008

FACTBOX-Lehman's 30 largest unsecured creditors' claims

FACTBOX-Lehman's 30 largest unsecured creditors' claims

Sept 15 (Reuters) - The following is a list of the 30 largest unsecured claims by creditors of Lehman Brothers, as listed in its Chapter 11 bankruptcy filing.

Aozora Bank, Bank loan $463 million

Mizuho, Bank loan $289 million

Citibank (Hong Kong branch), Bank loan $275 million

BNP Paribas, Bank loan $250 million

Shinsei Bank, Bank loan $231 million

UFJ Bank Ltd, Bank loan $185 million

Sumitomo Mitsubishi Banking Corp, Bank loan $177 million

Svenska Handelsbanken, Letter of credit $140.6 million

KBC Bank, Letter of credit $100 million

Mizuho Corporate Bank Ltd, Bank loan $93 million

Shinkin Central Bank, Bank loan $93 million

The Bank of Nova Scotia, Bank loan $93 million

Chuo Mitsui Trust, Bank loan $93 million

LLoyds Bank, Letter of credit $75.4 million

Hua Nan Commercial Bank, Bank loan $59 million

Bank of China (New York branch), Bank loan $50 million

Nippon Life Insurance Co., Bank loan $46 million

ANZ Banking Group, Bank loan $44 million

Standard Chartered Bank, Bank loan $41 million

Standard Chartered Bank, Letter of credit $36.1 million

First Commercial Bank Co., Bank loan $25 million

Bank of Taiwan, Bank loan $25 million

DnB NOR Bank ASA, Bank loan $25 million

Australia and New Zealand Banking Group, Bank loan $25 million

Australia National Bank, Letter of credit $12.6 million

National Australia Bank, Letter of credit $10.3 million

Taipei Fubon Bank New York Agency, Bank loan $10 million

In addition, the following three entries show positions by banks acting as indenture trustees, who administer the bonds but have no exposure to them.

Citigroup Bond debt ca. $138 bln

and the Bank of New York Mellon Corporation (with respect for the Euro Medium Term Notes only) as indenture trustee, under the Lehman Brothers Holdings Inc. Senior Notes.

Bank of New York Bond debt ca. $12 bln

Mellon Corporation as indenture trustee under the Lehman Brothers Holdings Inc. subordinated debt

Bank of New York Bond debt ca. $5 bln
Mellon Corporation as indenture trustee under the Lehman Brothers Holdings Inc. junior subordinated debt

(Compiled by EMEA Financial Services team in London, editing by Will Waterman)

other editing by AC1 :)

Saturday, September 06, 2008

I'm wishing Mark well, hope you can too!

Repossession is a tragedy but also a zero sum game

Published: August 12 2008 03:00 | Last updated: August 12 2008 03:00

From Dr Peter Harvey.

Sir, Chris Giles's amusing suggestion of "government sponsored arson" to increase demand beautifully illustrates the perverse logic of all these hair-brained proposals to support the housing market ("One way to heat up house prices", August 8). Nevertheless, desperate scenes of families losing their homes will mean that the chancellor will have little option politically other than to spend more of our money on being seen to try to address the problem.

Nonsensical economics aside, however, forcing those who choose not to overstretch themselves to subsidise (through tax or inflation) those who do is an unedifying prospect. Making non-homeowners, in particular, poorer in order to keep prices too high for them to afford is simply cruel. They should not be made to pay off mortgages on other people's houses, to prop up the unearned equity of Middle England, to underwrite the profiteering of speculators or to lock in the "earnings" of buy-to-let landlords - or be encouraged with this or that scheme to enter a market yet to fall to sustainable levels.

Repossession, while a tragedy for those involved, is also a zero sum game: for every family forced to relinquish a property they cannot afford, another has the chance of buying at a price they can. No amount of market manipulation can increase the proportion of people who are comfortably housed; this can be done only by changing the number of houses or changing the number of people.

Peter Harvey
Mathon, Worcestershire WR13 5NZ, UK

Via HawkEye, my eagle-eyed helper!

Thursday, September 04, 2008

Leanne Donaldson, 28, an administrator, and her partner Paul Langford, 25, an IT worker, are in danger of losing their home in Cheshire.

They are struggling to keep up with the cost of living and fear negative equity if they sell their two-bedroom house.

The first-time buyers, who earn a combined total of £30,000, purchased their home in September 2007 for £116,500, opting for a five-year mortgage deal with Northern Rock, at a fixed rate of 5%. They borrowed £122,500. Repayments cost them £800 per month.

"We can't afford to live," says Leanne. "Food prices have gone up and so has the cost of gas. We don't have any spare money. We have to shop around for bargains, we can't afford new clothes and we can't afford to go on holiday.

"We're worried about the house being repossessed. We've already missed a couple of payments - one last Christmas for presents and one because the car broke down and we had to use the mortgage money to fix it. If we miss any more they'll start to threaten us.

Good to see they have their priorities right. They've borrowed well over 100% of the purchase price of a house at 4 times their COMBINED earnings in SEPTEMBER 2007. Jeezus. It might be a struggle to pay the debts and they might fear repossession, but can't miss Xmas presents!!!