Wednesday, October 15, 2008

Today's Headlines

Bloomberg:
- Federal Reserve Chairman Ben S. Bernanke said government efforts to calm financial markets and stem the credit crisis probably won't result in an immediate economic rebound.

- The U.S. Securities and Exchange Commission agreed to back an effort by banks that may delay writedowns on some securities tied to losses that have cost companies more than $640 billion. Banks in certain cases may account for perpetual preferred securities as debt, allowing them to postpone writing down their value, SEC Chief Accountant Conrad Hewitt wrote in a letter yesterday to Financial Accounting Standards Board Chairman Robert Herz.

- Tumbling prices for energy, metals and grains led commodities lower as the prospect of a global recession dimmed the outlook for raw-material demand. Crude oil, down as much as 5.2 percent, dipped below $75 a barrel for the first time in more than a year. Copper fell more than 8 percent, soybeans reached a 13-month low and cotton neared the lowest price since May 2007.

- Brazilian stocks dropped, halting their biggest rally this decade, on concern slowing global growth will hurt demand for raw materials and reduce the earnings of the nation's biggest commodity producers.

- Cement producers in Russia are cutting back plans for new plants as the financial crisis derails construction projects and imports may more than double, an industry group said.


Wall Street Journal:

- By his own account, Mr. Obama wrote a letter to the Treasury Secretary, allegedly putting himself on record that subprime loans were dangerous and had to be dealt with. This is revealing; if true, it indicates Sen. Obama knew there was a problem with subprime lending -- but was unwilling to confront his own party by pressing for legislation to control it. As a demonstration of character and leadership capacity, it bears a strong resemblance to something else in Sen. Obama's past: voting present.

- Chesapeake Energy Corp.(CHK), this year’s worst-performing independent petroleum producer in the S&P 500, is in talks to sell some natural-gas assets to BP Plc(BP).

CNBC.com:
- Emerging markets suffer as foreigners withdraw. The Institute of International Finance, a consortium of global financial services firms based in Washington D.C., estimates that private sector capital flows to 30 emerging market nations across the world will fall by nearly a third from last year to $619 billion this year. Next year, they predict the sum will fall by another $60 billion. Chakraborty said he doubts the boom years will be back anytime soon.We are, he said, entering an era of slower growth, which will be reflected in lower stock market valuations."The fundamentals have changed," he said.

Philly.com:

- In a small office in West Conshohocken, a legendary stock market bottom feeder has been having a feast. John B. Neff, who racked up record gains as manager of Vanguard's Windsor Fund over three decades, is buying stocks again. And while the actions of one person may mean little in a multitrillion-dollar market, Neff's renewed romance with stocks signals that, to him, the worst is over.


Chicago Tribune:

- A federal appeals court ordered Ohio's top elections official to set up a system by Friday to verify the eligibility of newly registered voters and make the information available to the state's 88 county election boards. The full 6th U.S. Circuit Court of Appeals in Cincinnati on Tuesday upheld a lower court ruling that Secretary of State Jennifer Brunner must use other government records to check thousands of new voters for registration fraud.

- For the first time since oil prices began their meteoric rise this year, airlines are slashing fuel surcharges on a major international route: most flights between the U.S. and Europe.

- American troops acting on a tip killed the No. 2 leader of al-Qaida in Iraq — a Moroccan known for his ability to recruit and motivate foreign fighters — in a raid in the northern city of Mosul, the U.S. military said Wednesday.

Reuters:
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Commodity funds are struggling to regain a footing after a record fall in futures prices last week suggested to many that more liquidation could be in store for a sector that lost up to $60 billion (34 billion pounds) in the last quarter. Goldman Sachs (GS), the Wall Street powerhouse that made its name by predicting almost every commodities rally over the last six years, said Monday it had "underestimated" the impact of the current credit crisis on commodities' demand.Goldman earlier this year put a high of $200 on a barrel of crude oil by 2010 when the market was trending near $150. On Tuesday, U.S. crude fell more than 3 percent to close at $78.63 a barrel -- sharply off July's record high above $147."Should the financial and evolving economic crisis cut deeper into demand, the market could fall as low as $50, which we believe to be the industry's cash cost and shut in level," Goldman said in Monday's note.

Financial Times:
- Tom Albanese, Rio Tinto’s(RTP) chief executive, on Wednesday warned about the health of China and said the slowdown in one of the world’s fastest growing economies had led the mining company to revise its capital spending plans. Mr Albanese said there had been a marked reduction in Chinese commodity demand from the overheated levels of 2007 and added that the “vast majority of Chinese aluminium producers are now making operating losses.”

Kommersant:

- Russian banks are starting to limit customer withdrawals in a bid to avoid a run on deposits.


Valor Economico:

- Poultry farmers in Santa Catarina state, Brazil’s second-largest producer, should cut output by 5% because the global financial turmoil is reducing demand, an industry leader said. “We don’t know what’s going to happen, but we know that all the companies were ready to fulfill strong demand that may not exist,” said Ricardo Gouvea, the director of the state’s poultry producers’ association and of the meat packers association. Brazil is the world’s largest poultry exporter.



Press TV:

- Iran expects OPEC to cut production at its extraordinary meeting in Vienna on Nov. 18, saying such a step would be the “best decision.”


Etemaad:

- Iranian President Mahmoud Ahmadinejad said the next US president needs to improve ties with the Persian Gulf country.

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