Today's Headlines

Bloomberg:
- Bernanke Pledges ‘Adequate Insurance’ Against Risks.
- MBIA Inc.(MBI), the world’s biggest bond insurer, said it is equipped to survive the slump in prices of mortgage securities and dismissed suggestions that the industry needs a rescue or stronger federal oversight.
- Treasury two-year notes are yielding the least compared with 10-year debt since 2004.
- Total rail freight volume on US railroads was up during the first week of February in comparison with the same week last year, the Association of American Railroads reported. Total volume was estimated at 32.7 billion ton-miles, up 2.5% from last year.
- The risk of companies defaulting fell the most in two weeks after US retail sales unexpectedly gained and Japan’s economy grew at twice the pace economists forecast, according to traders of credit-default swaps. Contracts on the Market CDX North American Investment Grade Index, tied to the debt of 125 companies in the US and Canada, declined 2.75 basis points to 135.25, according to Deutsche Bank AG. The European benchmark Markit iTraxx Crossover index dropped 19 basis points to 529, according to JPMorgan Chase. The Markit iTraxx Japan index fell 4 basis points to 85, Morgan Stanley said.
- Brett Jefferson, formerly managing director at Marathon Asset Management LLC, is starting a hedge fund to buy distressed collaterialized debt obligations and asset-backed securities. The firm, called Hildene Capital Management LLC, aims to raise $1 billion and plans to start by April. Hildene has also hired John Scannell, a former vp in the CDO structuring group at Citigroup Inc.(C), as COO.
- Morningstar, Inc.(MORN), a leading provider of independent investment research, today launched the Morningstar Rating for hedge funds as well as the Morningstar 1000 Hedge Fund Index and 17 indexes based on the Morningstar Hedge Fund Categories.
- Freddie Mac(FRE), the second-largest provider of money for US home loans, will purchase loans covered by mortgage insurers that don’t meet the company’s standards for the amount of capital backing their policies.
- Treasury Secretary Henry Paulson reiterated his call for Congress to follow up on the economic stimulus package approved last week by passing legislation aimed at slowing a surge in foreclosures.
- President Bush urged the House to extend a law allowing electronic eavesdropping of suspected terrorists and said he may delay his scheduled trip to Africa tomorrow if needed to complete the measure.
- Crude oil is rising $1.78/bbl.to a one-month high as economic indicators from Asia and the US allayed concern that a global recession is imminent. Japan expanded 3.7% last quarter, twice the pace economists forecast, triggering the biggest increase for the country’s stock market in six years. A government report showed that US jobless claims fell last week. The US and Japan are responsible for about 30% of global oil consumption.
- Republican Mitt Romney will endorse John McCain in the Republican presidential race, citing people familiar with the plan.

Wall Street Journal:
- Ambac’s(ABK) Callen in Talks to Raise Cash, Keep Rating.
- ETF Industry Produces New Power Brokers.
- Bill Clinton to End Ties to Yucaipa as Scrutiny Grows.
- Comcast(CMCSA) to Deploy New High-Speed Internet Technology.

NY Times:
- NY Times to Eliminate 100 Newsroom Jobs.

PC World:
- Google(GOOG) to Enter China Online Music Market.

Morningstar:
- Brazil’s Petrobras(PBR) To Build Large New Biodiesel Plant.

Financial Times:
- European companies are increasingly being forced to turn to the US dollar markets to raise funding as the credit crunch makes it almost impossible for them to launch deals in the euro-denominated market. A gap between the two markets has opened up with US investment grade issuance at a record high for a January, while Europe slumped to a record low, according to Dealogic.

Caijing Magazine:
- Citic Securities and Bear Stearns(BSC) may lift their stakes in each other now that both their shares have fallen. The new plan may be announced in April if US and Chinese regulators approve it.