In previous blog I speak about low ranks…

In previous blog I speak about low ranks…

A Two Night Stay in Portugal

From: EnjoyTheLife (EnjoyTheLife@pyrolineinoscopy.com)

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Sent: 21 September 2008 15:23:15

1). Cantábria: Um morto em atentado da ETA
22.09.2008 - 08h36  Agências de Espanha

 A explosão de um carro armadilhado junto a uma escola militar de Santoña, na Cantábria, norte de Espanha, matou esta madrugada o oficial do Exército Luis Conde. O atentado foi precedido de uma chamada anónima em nome da organização basca ETA.

“Uma pessoa morreu e uma outra foi hospitalizada, mas a sua vida não corre perigo”, precisou à AFP uma fonte governamental autónoma da Cantábria. Ambas as vítimas pertenciam à escola militar Virgen del Puerto de Santoña, diante da qual ocorreu a explosão.
 Dizendo falar “em nome da ETA” - a organização separatista basca -, uma voz anónima ligou para os serviços de assistência rodoviária basca (DYA), a fim de alertar que uma bomba iria explodir à 01h00 local (00h00 em Lisboa) em Santoña, de acordo com um porta-voz da DYA.
 Os dois atentados foram levados a cabo com carros armadilhados, carregados de uma centena de quilos de explosivos, causando importantes danos materiais.
 A primeira bomba explodiu cerca da meia-noite diante de uma instituição de crédito, em Vitória. Esta explosão não provocou vítimas porque foi precedida de uma chamada de alerta em nome da ETA.
 A segunda bomba, que não teve aviso prévio, explodiu cerca das 04h30 (03h30) diante de um posto de polícia em Ondarroa - um porto pesqueiro do Golfo da Biscaia, não longe de Bilbau - fazendo dez feridos.

2). Goldman, Morgan to Become Bank Holding Companies

September 21, 2008, 9:35 pm

Goldman Sachs and Morgan Stanley, the last two independent investment banks, will become bank holding companies, the Federal Reserve said Sunday night, a move that will fundamentally alter the landscape of Wall Street.

The move alters one of the models of modern Wall Street, the independent investment bank, soon after the federal government unveiled the biggest market intervention since the New Deal. It heralds new regulations and supervision of previously lightly regulated investment banks, as well as an end to the outsize paychecks that helped shape the image of the chest-thumping Wall Street banker.

It is also the latest signal by the Federal Reserve that it will not let Goldman or Morgan fail. The move comes after the bankruptcy of Lehman Brothers and the near collapses of Bear Stearns and Merrill Lynch.

Now, Goldman and Morgan Stanley, which have been the subjects of merger speculation in recent weeks, can become direct competitors to larger firms like Citigroup, JPMorgan Chase and Bank of America. Those firms combine investment-banking operations with the larger capital cushions that come with retail deposits, giving them a stability that pure investment banks lack.

JPMorgan acquired Bear Stearns this spring in a fire sale brokered by the federal government, while Bank of America has agreed to buy Merrill Lynch for $50 billion. Barclays of Britain agreed to buy the core capital-markets business of Lehman Brothers out of bankruptcy late last week.

Announced without fanfare on Sunday night, the move signals the demise of the Glass-Steagall Act, the epochal legislation of 1933 that split investment banks and retail banks. A law enacted in 1999 repealed the earlier regulation, though Goldman and Morgan remained independent investment banks.

Morgan Stanley had sought other ways to bolster its capital, and had been in advanced talks with China’s sovereign wealth fund and others about raising as much as $30 billion, people briefed on the matter said Sunday night.

“While accelerated by market sentiment, our decision to be regulated by the Federal Reserve is based on the recognition that such regulation provides its members with full prudential supervision and access to permanent liquidity and funding,” Lloyd C. Blankfein, Goldman Sachs’s chairman and chief executive, said in a statement Sunday night. “We believe that Goldman Sachs, under Federal Reserve supervision, will be regarded as an even more secure institution with an exceptionally clean balance sheet and a greater diversity of funding sources.”

John J. Mack, Morgan Stanley’s chairman and chief executive, issued a statement that said: “This new bank holding structure will ensure that Morgan Stanley is in the strongest possible position – with the stability and flexibility to seize opportunities in the rapidly changing financial marketplace. It also offers the marketplace certainty about the strength of our financial position and our access to funding.”

By becoming bank holding companies, Goldman Sachs and Morgan Stanley gained some breathing room in the immediate term. But the change also may lay the groundwork for additional deal making. Given the number of bank failures expected this year, it is possible that Goldman and Morgan Stanley could seek to buy those banks cheaply in a “roll-up” strategy.

Before the move to make the two investment banks into holding banks, federal regulations prohibited them from pursuing such deals. Indeed, Morgan Stanley’s recent talks with Wachovia revolved around Wachovia buying Morgan Stanley.

Being a bank holding company would also give the two banks access to the discount window of the Federal Reserve. While they have had access to Fed lending facilities in recent months, regulators had planned to take away discount window access in January.

The regulation by the Federal Reserve also brings a host of accounting rule changes that should benefit the two banks in the current environment.

In return, they will submit themselves to greater regulation, including limits on the amount of debt they can take on. When it collapsed, Lehman had about a 30:1 debt-to-equity ratio, meaning it had borrowed $30 for every dollar in capital it held. Morgan Stanley currently has a debt-to-equity ratio of 30:1, while Goldman Sachs has one of about 22:1.

Bank of America, on the other hand, currently has about an 11:1 leverage ratio, while JPMorgan has about 13:1 and Citigroup about 15:1. Because they can borrow less, bank holding companies typically have lower earnings multiples.

In its statement, Goldman said that it would become the nation’s fourth-largest bank holding company, with its small existing deposit-taking units to be rolled into GS Bank USA. Morgan Stanley will convert its Utah industrial bank into a deposit-taking national bank, to be called Morgan Stanley Bank.

3). Emerging markets face battle to roll over $111bn of maturing debt

By London

Published: September 22 2008 03:00 | Last updated: September 22 2008 03:00

A vast backlog of bonds that need to be refinanced over the next year has built up in the emerging market economies, raising the threat of defaults and company closures.

With the ability to raise money in the debt markets severely restricted because of the credit crisis, emerging market banks and companies could struggle to roll over $111bn of maturing debt, according to ING Wholesale Banking.

David Spegel, global head of emerging markets strategy at ING, said: "Many corporates and banks in the emerging markets are highly levered without cash to fall back on.

"These will struggle should they need to raise money in the markets.

"The bond and loan markets are much harder to access now, and it could get worse, which means there will be defaults."

Of the $111bn in bonds that will mature before the end of 2009, $24bn worth are held by junk-rated groups that have almost no hope of tapping a market averse to risk.

Emerging market bond issuance has fallen steadily this year. Only $330m worth of bonds have been issued this month compared with $10bn as recently as July. In August last year, issuance averaged about $20bn a month, according to ING.

Although sentiment improved last Friday, emerging markets have been hit, with the MSCI share index down 14 per cent since the start of the month and yields on the Embi+ sovereign bond index up 20 per cent against US Treasuries.

Over the past two weeks, emerging market equity and bond funds have had $6.5bn in outflows, close to records, according to EPFR Global, the data provider. This has extended a trend since June 1, when inflation fears put pressure on emerging markets. Outflows since then have risen to $35bn, a record for a 16-week period.

The bulk of the emerging debt due - $59bn - is from banks and financial groups, many of which are exposed amid fragile confidence in the sector.

Banks in Russia and Kazakhstan, (В Калуге опрокинулись и загорелись пять цистерн с бензином regions.ru | 13:15:22          Пять цистерн с бензином сошли с рельсов и опрокинулись у Черновского хутора на окраине Калуги, четыре цистерны загорелись, пострадавших нет.          Инцидент произошел в промышленной зоне на подъездных путях к ОАО "Калуганефтепродукт".          Пожар распространился на площади 600 кв. метров. Прибывшие на место пожарные ликвидировали пожар.  В настоящее время по факту случившегося возбуждено уголовное дело по ч. 1 ст. 263 УК РФ по которой полагается до пяти лет лишения свободы. ) which accumulated much debt before the credit crisis, are likely to be among the casualties in a climate where even an investment-grade bank such as Lehman Brothers can quickly be forced into default.

The outlook is better for countries such as Brazil and Chile, which are rich in cash as still-high commodity prices and relatively resilient economies continue to boost balance sheets.