| Global News Coverage for Investment Professionals |  |
- Obama urges swift approval of Senate's health care bill
Only 14 hours after the House narrowly approved its health care bill, U.S. President Barack Obama called on the Senate to act quickly and enact its version. He called the House's action a "courageous vote." Obama's health care plan could face an even tougher fight in the Senate, in which Majority Leader Harry Reid, D-Nev., wants a vote before Thanksgiving. Senate Democrats are struggling to hang onto votes from 58 Democrats and two independents, needed to shut down a threatened Republican filibuster. One independent, Sen. Joe Lieberman of Connecticut, said he will vote against any plan that would provide government-run insurance. Los Angeles Times
(09 Nov.), The Wall Street Journal (tiered subscription model)
(09 Nov.), NYTimes.com
(08 Nov.), Google/The Associated Press
(08 Nov.), The Washington Post
(08 Nov.), Politico (Washington, D.C.)
(08 Nov.), USA TODAY/The Oval blog
(08 Nov.), Bloomberg
(08 Nov.)
- Analysis: Much learned 20 years after fall of Berlin Wall
Destruction of the Iron Curtain on Nov. 9, 1989, is a reminder of the importance of economic liberalism, right when the financial crisis has made people doubt it, according to this article. The move to take 500 million people out of poverty and into the middle class will be much more remembered in the future than the recent troubles of Lehman Brothers. Political freedom also could follow economic freedom.  CNBC
(09 Nov.), The Economist
(05 Nov.)
- Geithner fails to spur bank lending in U.S.
Commercial and industrial lending in the U.S. has dropped 17% since October 2008, according to the Federal Reserve. Efforts by Treasury Secretary Timothy Geithner to incite banks to lend more seem to have had little effect. Analysts see this as a significant threat to economic growth. The lack of bank lending is "a serious problem," said Jan Hatzius, chief U.S. economist at Goldman Sachs. "This could keep growth significantly weaker than the consensus view in 2010 and is likely to keep the Federal Reserve at a near-zero-percent funds rate all next year." Bloomberg
(08 Nov.)
- Economists say U.S. GDP is miscalculated
The calculation of U.S. GDP is not correct, a group of economists said. Imports priced at their point of origin at a certain amount are being accounted for at U.S. prices when GDP is calculated. The problem appears to have swelled GDP reporting, the economists said. While last quarter's GDP was reported at an annual growth rate of 3.5%, the number was actually 3.3%, they said. NYTimes.com
(08 Nov.)
- India's Singh seeks investment in state companies
Indian Prime Minister Manmohan Singh said the government will sell off stakes in state-owned companies on the stock market. He also called for foreign direct investment in the country. Investors had been concerned that capital controls are being put on international investment. Singh said he wants "to see faster progress in sale of a portion of government shareholding in the domestic market and issue of fresh equities in respect of the selected companies." Business Standard (India)
(09 Nov.)
- U.S. corporate-bond issuance to slide in 2010, BarCap says
Corporate-bond issuance in the U.S. is expected to drop 29% next year, according to Barclays Capital. Issuance this year is already at $950 billion, but it is expected to drop to $750 billion total in 2010. The surge this year was driven by recapitalization needs after the financial crisis, but companies will not need as much cash next year, Barclays said. Reuters
(06 Nov.)
- Sources: Comcast, GE set NBC Universal's value at about $30B
Comcast moved closer to buying a 51% equity stake in an entity that would own General Electric's NBC Universal with an agreement between the companies to value the unit at about $30 billion, sources said. The purchase would give Comcast opportunities to buy cable programming, an objective that CEO Brian Roberts said is a priority for acquisitions. France's Vivendi holds an annual option to sell its 20% stake in NBC Universal between Nov. 15 and Dec. 10 but said it is in "no hurry" to exercise the option. Bloomberg
(08 Nov.), The Washington Post/Reuters
(09 Nov.)
- China to expand bank lending 20% to 22% next year, bank says
Bank of Communications, China's fifth-largest commercial lender, predicted that bank lending will grow 20% to 22% next year to further stimulate the country's economy. In the first three quarters of this year, banks lent a record $1.27 trillion, a 30% increase compared with the same period last year. Bank of Communications expects any reduction in lending to be determined by government policy. Xinhuanet.com (China)
(08 Nov.)
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Project finance could cause risk, Bank of China chief says: Lending to specialized vehicles for project finance could cause systemic risk in Chinese banking, Xiao Gang, head of Bank of China, wrote in the People's Daily newspaper. Special vehicles set up to finance infrastructure projects are borrowing too much, possibly beyond their ability to repay, Xiao said. "Many such loans were huge and were usually funded by several banks together. If default happens, it will affect the nation's banking industry extensively," Xiao wrote. China Daily (Beijing)
(09 Nov.)
- Outlook for European insurers is dim
Impressive third-quarter results at European insurers were an exception, analysts said, and the outlook for the companies is not bright. Insurers' earnings increased on good return on investment, and the firms were not hit by major natural disasters. But these sources of earnings are not necessarily repeatable, analysts warned, and premium generation must provide the most income. However, there is no indication that premium generation will increase, analysts said. The Wall Street Journal (tiered subscription model)/Dow Jones Newswires
(09 Nov.)
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- Oil price climbs as Hurricane Ida moves into Gulf of Mexico
The price of oil broke $78 a barrel as Hurricane Ida picked up strength and headed toward offshore oil and gas fields in the Gulf of Mexico. The gulf provides 27% of U.S. crude-oil production and 15% for natural gas. BP, Chevron and Marathon Oil reduced operations in the gulf in anticipation of the hurricane, and the Louisiana Offshore Oil Port suspended unloading tankers because of rough seas. Bloomberg
(09 Nov.), Reuters
(08 Nov.)
- Investor appetite grows for Asian alternative assets
Investment advisers said investors in Asia and beyond are becoming increasingly prepared to allocate capital directly to hedge funds and private equity. "It's still early stages in Asia, but we are now in the growth phase as far as the hedge fund industry is concerned," said Ananth Shenoy, Citi Private Bank's head of managed investments for Asia. "So from that perspective, there's more reason for us to look at locally sourced and developed solution sets." AsianInvestor.net
(09 Nov.)
- China's Wen hopes U.S. holds deficit down for "basic stability"
Chinese Premier Wen Jiabao said he hopes the U.S. holds its budget deficit at "an appropriate size" for exchange-rate stability and "that is conducive to stability and the recovery of the global economy." China has invested about 70% of its foreign exchange reserves, estimated at more than $2 trillion, in dollars and dollar-denominated assets. "I hope that as the largest economy in the world and an issuing country of a major reserve currency, the United States will effectively discharge its responsibilities," Wen said. China Daily (Beijing)
(09 Nov.)
- U.K. employment is "flat on its back," report says
The outlook for employment growth in the U.K. is grim, according to the Chartered Institute of Personnel and Development and KPMG. Employers seeking to add jobs has increased since the second quarter, but not by much. "The U.K. jobs market remains flat on its back ... the patient remains seriously weak and won't recover for several years, even if a return to robust economic growth provides the necessary tonic," said Gerwyn Davies, public policy adviser at the institute. The Times (London) (subscription required)
(09 Nov.)
| Geopolitical/Regulatory | | |
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- G-20: Banks must carry more of burden in future bailouts
The Group of 20 nations took a strong line against excessive risk-taking in the financial system and said banks must pay more of the cost in future bailouts. But a proposal from British Prime Minister Gordon Brown for taxing financial transactions, the so-called Tobin tax, was solidly opposed by U.S. Treasury Secretary Timothy Geithner as well as officials from Canada, Russia, the International Monetary Fund and the European Central Bank. With such wide-ranging criticism, Brown quickly back-pedaled. "We're not that massively wedded to a transactions tax," U.K. officials said. Bloomberg
(09 Nov.), Financial Times (tiered subscription model)
(08 Nov.)
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