Today's Headlines

Bloomberg:
- The US dollar strengthened to a three-week high against the euro on speculation the Fed will signal that it’s done lowering interest rates.
- Crude oil fell more than $3 a barrel, the biggest decline in four weeks, after BP Plc restarted a North Sea oil pipeline and the US dollar strengthened, reducing the appeal of commodities to investors. “For the first time in weeks we have some bearish factors in the forefront,” said Peter Beutel, president of energy consultant Cameron Hanover Inc. “We are finally seeing a stop to the buying-with-abandon.”
- President Bush blamed Congress for blocking his initiatives to mitigate rising energy costs by expanding domestic production and said lawmakers also are delaying action on other measures to address higher food costs and the mortgage crisis.
- Bonds, Stocks Show Bernanke Fixing Financial System.
- MasterCard Inc.(MA), the world’s second-biggest credit-card network, said profit more than doubled, earning more than rival Visa Inc.(V). The shares surged as much as14%.
- Apollo Management LP founder Leon Black said investment banks have pared their backlog of debt committed to leveraged buyouts and will resume funding deals this year. “We’re well on our way” to a credit-market recovery, Black said.
- Current credit prices reflect “unprecedented default levels” that can only happen in a deep recession, Man Group Plc, the world’s largest publicly listed hedge fund manager, said. The price levels represent an attractive opportunity for credit managers who are able to buy credit products at deep discounts, it said. “It is advantageous for distressed hedge funds to invest early, as spreads usually tighten quicker than they widen, especially for fundamentally sound companies,” said Man analysts led by Thomas Della Casa in the report. Banks have slashed their backlog of unsold leveraged loans, or lending to finance leveraged buyouts, to $95 billion, from $245 billion in July 2007, S&P said. Distressed assets hedge funds that invested at the November 2002 bottom of the 2001 to 2002 recession could have generated an annualized return of 21.9% over two years, Man said.
- Brazilian output of sugar-cane used to make sweeteners and ethanol will rise as much as 22% from last year’s record because of increased planting and as rains and new technologies boost crop yields, the government said.
- Wheat fell to the lowest price in five months after a US government report showed winter-crop conditions unexpectedly improved, easing concern that global inventories will dwindle.
- Soybeans fell for the fifth consecutive session on speculation a rebound in the US dollar will reduce the appeal of commodities as an inflation hedge.
- President Bush called the farm bill being put together by congressional negotiators a “massive, bloated” piece of legislation that would pay subsidies to “multimillionaire farmers.”
- India’s central bank unexpectedly ordered lenders to set aside more reserves for the second time in less than two weeks to tame runaway inflation.
- Wachovia Corp.(WB) was raised to “buy” for the first time in seven years by Deutsche Bank AG, which said the company may be finished raising capital to offset mortgage losses.
- Rice fell the most in six weeks after a government report showed US planting accelerated last week and grain sales slowed, easing concern of a global food crisis.

Wall Street Journal:
- When Citigroup(C) was launching a pair of hedge funds last year, it didn’t have to look far for investors. Brokers at the firm’s Smith Barney unit drummed up hundreds of millions of dollars from retail clients, including some who were told the fixed-income funds were a safe place to stash money. Since then, the hedge funds, devastated by the credit crunch, have plunged by 75% or more in value.

NY Times:
- It is known simply as the X-room. Set up last November at the Courtyard by Marriott in partnership with the University of Delaware in Newark, it is a test guest room. It is equipped with everything from waterproof mattresses to the experimental technology of wireless electricity to a specially designed Nintendo Wii game console for travelers. There is also a digital door display that lets guests see who is in the corridor.

CNBC.com:
- Millionaires view the US economy as “very weak,” but sense a resumption of growth early next year and expect to buy stocks and real-estate in the latest indication that a recovery may be imminent, according to a study released Tuesday.

Commodity Online:
- Expect biofuel from grass soon! Forget the controversy over fuel from corn, sugarcane and wheat, here comes biofuel from grass to save the world from food crisis. Scientists in many companies and research institutions are tackling the challenges of unlocking energy from cellulose – leaves, stems, stalks or other non-edible parts of plants.

Treasury & Risk:
- The Hedge Fund Sleight of Hand. Not only do funds sometimes control more than a company can see, they often have hedged away risk.

USA Today:
- The call girl linked to the downfall of former NY Governor Eliot Spitzer sued the founder of the “Girls Gone Wild” series on Monday for $10 million.

AppleInsider:
- Reports aiming to predict what Apple’s(AAPL) 3G iPhone will look and feel like continue to pour in this week, with the latest claim coming by way of the Taiwan Economic News, which says the next-generation device will be both lighter and more compact than the first generation model.

Houston Chronicle:
- By pioneering the science of seasonal hurricane forecasting and teaching 70 graduate students who now populate the National Hurricane Center and other research outposts, William Gray turned a city far from the stormy seas into a hurricane research mecca. As he enters his 25^th year of predicting hurricane season activity, Colorado State Univ. officials say handling media inquiries related to Gray’s forecasting requires too much time and detracts from efforts to promote other professors’ work. But Gray, a highly visible and sometimes acerbic skeptic of climate change, says that’s a “flimsy excuse” for the real motivation – a desire to push him aside because of his global warming criticism.

PIMCO:
- Pimco’s Bill Gross plans to invest in low-quality bonds, banks.

TimesOnline:
- UK House Prices Could Fall 25% Over Next Two Years.

Cinco Dias:
- Apple Inc.(AAPL), which plans to start selling its iPhone in Latin America, is reconsidering a strategy of offering the device only through exclusive franchises. The company may offer the handheld device through various phone companies in the same country.

Der Standard:
- European Central Bank President Jean-Claude Trichet said current interest rates will help to curb inflation, citing an interview. “We believe that our current monetary stance will guarantee price stability over the medium term,” Trichet said. Trichet also said that “strong foreign exchange volatility is of course cause for concern.”

Gulf Times:
- Soaring inflation and high real estate prices are having a negative impact on businesses in Saudi Arabia, where inflation hit a 30-year peak of almost 10% in March.