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Saturday, 22 November 2008
Singapore’s Temasek cuts pay to combat slowdown
Singapore’s state investor Temasek Holdings said on Friday it would cut pay across the board in a bid to slash costs as the firm projects tough economic conditions in 2009 and beyond.
SINGAPORE, Nov 21 - Singapore’s state investor Temasek Holdings said on Friday it would cut pay across the board in a bid to slash costs as the firm projects tough economic conditions in 2009 and beyond.
Temasek, headed by Ho Ching, the wife of Singapore’s Prime Minister Lee Hsien Loong, said senior managers had volunteered to take a pay cut of between 15 and 25 percent.
“We anticipate a global recession in 2009 and possibly beyond. Therefore, Temasek will institute a firm-wide wage cut,” said Robert Chong, managing director of human resources at Temasek.
Chong also said the current crisis “will throw up tremendous opportunities” and that the majority of wage savings will be borne by their key managers. Temasek said it aimed to increase headcount by 15 percent over the next two years.
Temasek owns stakes in global banks such as Standard Chartered, Barclays, Merrill Lynch, Bank of China and India’s ICICI Bank, the stocks of which have all fallen as the credit crisis unfolded, some of them very sharply.
Final government data released on Friday confirmed that Singapore was in recession. The city-state’s economy shrank at a worse-than-expected rate of 6.8 percent on an annualised and seasonally adjusted basis in the third quarter, and the government said the economy may shrink next year.
但是也说不定,在政府的主导下,市场又起来一波经济快速增长。To lead the world,China must become market oriented and have a convertible exchange rate（要想领导世界,中国必须成为市场主导以及汇率自由浮动）。从这次的亚欧峰会上看,没有讨论stabilizing the global economy（稳定全球经济）,只是讨论了金融改革。金融改革这是多么遥远的事情啊。嗯,有点遗憾。
Junk Bond Yields Reach Record 20% as Economy Declines
By Gabrielle Coppola and Caroline Salas
Nov. 19 (Bloomberg) -- Yields on speculative-grade corporate bonds surpassed 20 percent for the second straight day as a declining economy increased the risk of default.
The average yield on high-yield, high-risk debt rose to 20.81 percent today, from 20.14 percent on Nov. 18, the previous record, according to Merrill Lynch & Co.'s U.S. High Yield Master II index. The level is the highest since Merrill began collecting overall yield data in January 1986.
Junk bonds have lost more than $187 billion in market value since August on speculation the U.S. recession will leave a glut of companies unable to meet their debt payments, Merrill data show. General Motors Corp.'s announcement Nov. 7 that it may run out of operating cash as soon as this year stoked default concerns, said Martin Fridson, chief executive officer of money management firm Fridson Investment Advisors in New York.
``Prices are in a virtual freefall,'' Fridson said. ``Either the market is right and expecting a default rate considerably higher than it was in the Great Depression, or we have such profound dislocations and selling pressures going on that it really is creating extraordinary fundamental value.''
About 72 percent of high-yield issuers have bonds trading at so-called distressed levels, or with yields of at least 10 percentage points more than similar-maturity Treasuries, Merrill data show. That ratio implies a default rate of 18 percent in the next 12 months, according to Fridson.
`Economic Backdrop'
Before this year, the record high for speculative-grade bond yields was 18.3 percent in October 1990, when the yield on 10- year Treasuries was about five percentage points higher than it is now, Fridson said. High-yield, or junk, bonds are those rated below Baa3 by Moody's Investors Service and lower than BBB- by Standard & Poor's.
``People are just worried about the economic backdrop, they're worried about rising defaults,'' said Stephen Antczak, a credit strategist at UBS AG in Stamford, Connecticut.
Moody's increased its forecast for high-yield corporate defaults on Nov. 12 to more than 10 percent in the next 12 months, citing a ``deep and protracted'' recession in the U.S. The credit rating company had predicted a 7.9 percent high-yield default rate a month earlier.
The number of companies at risk of running out of cash reached the highest level since 2002 in October, Moody's said in a Nov. 17 report. As of October, 14 percent of rated companies had an SGL-4 ranking, Moody's lowest level of liquidity rating, up from 12.6 percent in September, the report said. That's the highest percentage since 2002, when Moody's began tracking the data.
Automakers Before Congress
General Motors, Ford Motor Co. and Chrysler LLC, the three largest U.S. automakers, are lobbying Congress today for government aid to stave off bankruptcy.
Detroit-based General Motors, its financing arm GMAC LLC, and GMAC's mortgage unit Residential Capital LLC are three of the four worst performers this month of the 50 biggest issuers in the high-yield market, according to Merrill. GM has lost 29.5 percent, GMAC is down 23 percent and ResCap securities have tumbled 45 percent on average, Merrill data show.
GM's $3 billion of 8.375 percent bonds due in 2033 fell 0.25 cent to 18.75 cents on the dollar at 11:51 a.m. in New York, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The debt yields 44.5 percent, or 40 percentage points more than similar-maturity Treasuries, Trace data show.
Freescale
Freescale Semiconductor Inc. bonds have also lost 27 percent in November, tumbling after Intel Corp. heightened concern the financial crisis is stifling global technology spending by slashing its fourth-quarter sales forecast by about $1 billion. Austin, Texas-based Freescale was taken private in 2006 for $17.6 billion by a group led by Blackstone Group LP.
``The near-term pressures are very challenging,'' said Antczak. ``There's no reason'' relative yields won't continue to rise.
The extra yield, or spread, investors demand to own junk bonds instead of Treasuries rose for the fifth day in a row, increasing 53 basis points yesterday to a record 17.96 percentage points, according to Merrill Lynch. The average price has fallen to 59.5 cents from 85.6 cents on Aug. 31, wiping out more than $187 billion in market value, Merrill data show.
``The risk premiums are just at a staggering level,'' said Fridson. ``The number is not something any of us expected to see,'' he said, referring to the 20 percent yields.
Berkshire Asked by SEC in June for Derivative Data
By Erik Holm
Nov. 21 (Bloomberg) -- Warren Buffett's Berkshire Hathaway Inc. provided more details on $37 billion of derivative bets after the U.S. Securities and Exchange Commission asked in June for ``more robust disclosure'' on how it values the contracts.
Berkshire doesn't have to buy the securities that underlie the derivatives, the Omaha, Nebraska-based firm said in an October 3 letter to the SEC released today. A subsequent SEC letter to Berkshire, dated Oct. 7, said its review of the company was completed, with no further comments.
The SEC contacted Berkshire Chief Financial Officer Marc Hamburg with the request for more information before investor concern about the derivatives, a bet on the world stock markets, contributed to a 20 percent decline in the firm's shares in the past two weeks. The exchange of letters was released by the SEC today.
Hamburg told the SEC in July that the company values derivative contracts using a model that includes equity prices, interest rates, market volatility and the dollar's performance against other currencies -- language the firm repeated in subsequent quarterly filings. The response was part of a four- month long exchange of letters that also concerned Berkshire's fixed-income investments and its insurance operations in Europe.
Jackie Wilson, a spokesman for Berkshire, didn't return an e-mail seeking comment. John Nester, a spokesman for the SEC, declined to comment.
Derivative Bets
Buffett sold the derivative contracts to undisclosed buyers for $4.85 billion to protect them against declines in four stock markets, including the Standard & Poor's 500 Index.
Under the agreements, Berkshire will pay as much as $37 billion if, on specific dates beginning in 2019, the indexes are below the point where they were when he made the agreements. By Sept. 30, Berkshire had written down the contracts by $6.73 billion as the S&P declined for a fourth straight quarter.
``I believe these contracts, in aggregate, will be profitable,'' Buffett said in a statement in May, reiterating comments from his letter to shareholders in February. ``We are always ready to trade increased volatility in reported earnings in the short run for greater gains in net worth in the long run. That is our philosophy in derivatives as well.''
Stake in Moody's
The SEC also asked for information about Berkshire's stake in Moody's Corp., the ratings firm. Connecticut's attorney general said in May he was investigating possible conflicts concerning Berkshire's bond-insurance unit and its ownership of Moody's stock.
Berkshire said in its response to the SEC that it ``could not control or significantly influence the management or operating practices at Moody's.'' Berkshire paid about $2 million to Moody's last year for ratings services, Hamburg said in the letter.
Buffett, ranked the richest American by Forbes magazine, transformed Berkshire from a failing textile maker into an enterprise with businesses ranging from ice cream and underwear to corporate jet leasing.
Berkshire today rose 16 percent, the most since at least 1987, to close at $90,000 in New York Stock Exchange composite trading. Until this week, the stock hadn't ended a day below $100,000 since 2006.
Citigroup stock dive rebuffs claim by Treasury's Paulson
The financial giant's shares lead a meltdown in financial issues just one week after Paulson says he believes 'the banking system has been stabilized.'
By Tom Petruno November 21, 2008
Many things that Treasury Secretary Henry M. Paulson has said about the credit crunch and financial markets have come back to haunt him.
Now many investors appear to expect a U.S. rescue of Citigroup Inc. -- just one week after Paulson sought to assure the American people that the banking system has "been stabilized."
Citigroup shares dived $1.69, or 26.4%, to $4.71, leading another meltdown in financial shares, as investors bailed out on fears that the sinking economy could torpedo the financial giant. The plunge in financial issues Thursday helped drive the Standard & Poor's 500 index to an 11-year low.
Citigroup stock failed to get any lift from a promise by Saudi Prince Alwaleed bin Talal, who owns 4% of the firm, that he would boost his stake because he believes the shares are undervalued.
Once the government started pumping capital into banks last month, many investors assumed that the biggest institutions were at least assured of survival.
But the market clearly has major doubts about Citigroup, even with $25 billion in government capital now on its books.
That was evident Thursday in the market for insurance contracts known as credit default swaps, where the annual cost of insuring Citigroup bonds rocketed to $390,000 per $10 million of debt, from $240,000 on Tuesday, according to Reuters.
The cost surged even though the Federal Deposit Insurance Corp. has agreed to guarantee U.S. banks' debts.
Citigroup swaps "shouldn't be trading at these wide levels if in fact there's a backstop from the Treasury, an implicit guarantee," Ricardo Kleinbaum, a credit analyst at BNP Paribas in New York, told Reuters.
One week ago, Paulson was confident that investors were over the worst of their concerns about the banking system. In an NPR interview, he said: "I believe the banking system has been stabilized. No one is asking themselves anymore, is there some major institution that might fail, and that we would not be able to do anything about it. So I think that is a positive."
When the interviewer pressed Paulson on the idea of another major failure, the Treasury chief didn't flinch.
"I got to tell you, I think our major institutions have been stabilized," he said. "I believe that very strongly."
WASHINGTON (AP) - Federal regulators will guarantee as much as $1.4 trillion in U.S. banks' debt in a bid to get the distressed financial system pumping again.
They also took steps to make it easier for private investors to buy failed banks seized by the government.
Against a bleak economic backdrop, news that New York Federal Reserve President Timothy Geithner is President-elect Barack Obama's choice for Treasury secretary gave battered Wall Street a shot in the arm Friday.
The Dow Jones industrials zoomed nearly 500 points as stocks erased roughly half the losses racked up the prior two days.
Investors have been seeking a clear message from Obama on who will lead his economic brain trust during the financial crisis.
Directors of the Federal Deposit Insurance Corp. voted to approve the bank-debt guarantee program, which is part of the government's financial rescue package.
The FDIC program is meant to break the crippling logjam in bank-to-bank lending by guaranteeing the new debt in the event of payment default by the borrowing bank.
Some analysts have said that freeing up bank-to-bank lending with the guarantees won't necessarily translate into a thaw in broader lending as banks are still wary of making loans to businesses and consumers.
The FDIC also will guarantee deposits in non-interest-bearing "transaction'' accounts by removing the current $250,000 insurance limit on them through the end of next year.
That could add as much as $500 billion to FDIC-backed deposits.
Short-term debt issued by banks - for 30 days or less - is not covered as to avoid creating more volatility for the Federal Reserve's primary interest rate.
The Fed on Oct. 29 slashed the rate to 1 percent, a level seen only once before in the last half-century.
Many economists predict the Fed will lower rates again next month at its last meeting of the year.
Treasury Department spokeswoman Brookly McLaughlin on Friday called the FDIC action "an important step to strengthen the financial system by increasing confidence in the markets.''
Elsewhere, the Office of the Comptroller of the Currency, which oversees national banks, issued its first approval of a new kind of bank charter intended to increase the "pool of potential buyers'' of failed banks.
The Treasury Department agency said the new charter is intended for private investors interested in bidding on troubled banks that have been taken over by the FDIC.
The first preliminary approval went to Ford Group Bank, whose owners include Hilltop Holdings, Inc., an investment vehicle for Texas billionaire Gerald J. Ford.
Twenty-two federally-insured banks and thrifts have failed this year, compared with three for all of 2007.
Failures continued apace on Friday, as regulators shut down two big thrifts based in Southern California - Downey Savings and Loan Association and PFF Bank & Trust - saying they fell victim to the acute distress in the housing market in that state.
Thrifts differ from banks in that, by law, they must have at least 65 percent of their lending in mortgages and other consumer loans - making them particularly vulnerable to the persistent housing downturn.
Also shuttered Friday was The Community Bank, a small bank in Loganville, Georgia. It's expected that many more banks won't survive the next year of economic tumult.
While the FDIC threw a blanket of guarantees over U.S. banks, President George W. Bush ensured that millions of laid-off workers will keep getting their unemployment checks as the year-end holidays approach.
Bush signed an extension of jobless benefits into law just before he left for Lima, Peru, to attend the 21-nation Asia-Pacific Economic Cooperation forum.
Still, a Federal Reserve official warned Friday that the economy's weakness will stretch well into next year.
"We likely are in for a protracted period of poor economic performance,'' said Charles Evans, president of the Federal Reserve Bank of Chicago.
Many analysts believe the economy will continue to shrink through the rest of this year and into the next, more than meeting a classic definition of recession.
Investors were discouraged earlier this week by the inability of the White House and Congress to agree on a plan to provide relief to the battered U.S. auto industry.
Hearings are expected the week after next and lawmakers could consider legislation in December.
Other federal actions to resuscitate an economy crippled by home foreclosures, a credit freeze and confusion in financial markets will probably have to wait until January.
Obama has pledged to make economic recovery the immediate focus of his new administration, and both the House and Senate will have increased Democratic majorities eager to support him.
Banking baddies get help but Europe's car industry is left to languish
David Gow in Brussels November 19 2008
Bankers are now the most hated professionals, more so even than politicians and journalists. Through reckless greed and the selfish pursuit of their annual bonus, they brought the west's financial system to its knees. They ripped off their loyal individual customers with excessive charges and called on their retail investors, whom they viewed with contempt, to bail them out when in trouble.
And now, when European governments alone have committed to them €2.2trillion (£1.8tn) in fresh capital and loans guarantees, they are helping to deepen the recession by refusing to lend to vital small businesses – and to the car industry, a core element of the manufacturing sector.
The European commission, the chief guardian of the EU's competition rules, is happily turning a blind eye to "moral hazard" and allowing a host of governments to rescue banks that were the architects of damage to themselves and the wider economy. At the same time, it is getting sniffy or even downright hostile with governments shaping up to save hundreds of thousands of jobs for car workers.
Why this ambivalence – mirrored in the US where the lame duck Bush administration is refusing to raid the $700bn (£465bn) toxic asset relief programme (Tarp) to aid the "big three" carmakers? First and foremost, says Neelie Kroes, the EU competition commissioner, the financial sector cannot be compared to the car sector. "If your financial system is not working any more, then it's over. That was our incentive to give medicine to its blood circulation," she said in Paris this week.
Her aides put it like this. "Systemic risk, old chap." That is, if one bank goes down, the spillover effect could bring others to their knees in its wake and put an entire economy at risk. So bankers lacking even elementary social responsibility, let alone social consciences, are rescued by society as a whole.
Carmakers, on the other hand, are held to account for the undoubted errors of judgment and management they have made and offered, at most, limited aid. The €1bn loan guarantees for Opel, part of General Motors, being considered by the German chancellor, Angela Merkel, will, one is told, be ruled out of order on competition grounds – under the same state aid rules, of course, that have been bent to bail out banks. "Banks can ask for anything they want and get it," says one exasperated industry source.
The commission is worried that soft loans on the scale Merkel is examining could simply flow across the Atlantic to the mothership in Detroit and bail out GM. Both she and Carl-Peter Forster, the head of GM Europe, insists they won't.
But, leaving that aside, is there no "systemic risk" if Opel, already owed €1bn by GM, goes down and takes 100,000 jobs with it? Probably lots more if other German carmakers, also afflicted by declining sales in the credit crunch, and suppliers are put at risk. The sector directly and indirectly employs 1.2 million people in Germany alone.
So important is it that one of the German government's "five wise men", its group of official economic advisers, is proposing that Opel be temporarily nationalised, on the same lines as some European banks. It could then be sold to private investors or merged with another less stricken firm. Opel's problems are, largely, not homemade: they stem 80% from the misguided executive team in Detroit, according to one respected analyst.
This cuts little mustard in Brussels where, despite the critical chants of the non-governmental organisations and green campaigners about its lobbying muscle over carbon emissions, the European auto industry carries less political weight than it does in the US. It has the support of Guenter Verheugen, the much-diminished industry commissioner and lobbyist, but the commission as a whole rejects his "blank cheque" approach.
The industry bitterly contrasts the support promised for a "strategic" sector by the US president-elect, Barack Obama, with the piecemeal, reluctant attitude of the EU. Obama is viewed as seeing the car sector as the backbone of US manufacturing and as being prepared to offer it incentives not just to retool for "green" technologies but to recover and sustain employment.
Next week, when the commission lays out its proposals for steering the European economy out of crisis, there may be measures for the motor manufacturing sector such as incentives for consumers to scrap their gas-guzzling old bangers and gear up to more fuel-efficient vehicles. The European Investment Bank will also scale up its loan facilities – €7bn in recent years - for the industry under its climate change package. But the amount will be nothing like the €40bn sought by the industry.
This hardly squares with the enormity of the bailout for the banks. Kroes argues that she, too, isn't offering any blank cheques to the financial sector, pointing to the tough conditions – no dividends until preference shares are repaid, reduced or scrapped bonuses, lower fixed salaries etc – she has imposed in approving rescue packages. Restructuring plans have to be submitted after six months.
"You shouldn't run away with the idea that the commission is handing out money willy nilly to banks," her aides say. The German government aid for Commerzbank, for instance, has been held up because the interest coupon (8%) is considered too low (a minimum 10% is required).
But there is little evidence so far that the banks will change their ways if and when the crisis is over. Sure, Rod Kent, the former Bradford & Bingley chairman, has said the bank is "massively sorry". Josef Ackermann, the Deutsche Bank chief, who has waived his bonus this year (he earned a mere €14m last year), has admitted to failings and to the inevitability of greater regulation.
He's talking of a Damascene conversion – similar to the "cultural shift" signalled this week by the UBS chairman, Peter Kurer, when he set out the Swiss bank's tough new remuneration policy and said the era of mega-bonuses was over. But, if the general recovery begins in 2010, so will in all likelihood the revival of bonus and stock options handouts. A shrunken auto industry may tell a different story. Bloated bankers count; careworn carworkers don't.
U.S. stocks soared in late afternoon trading on news that Timothy Geithner, president of the Federal Reserve Bank of New York, was President-elect Barack Obama’s choice for Treasury secretary.
The Dow Jones industrial average closed up 494.13, or 6.54%, at 8,046.42; the S&P 500 rose 47.59, or 6.32%, closing at 800.03; and the Nasdaq composite was up 68.23, or 5.18%, to close at 1,384.35. All numbers are preliminary.
The Dow was down about 30 points when news of Mr. Geithner’s appointment this afternoon sent the blue-chip index surging.
“The markets are reacting well and seem to have a good view of him (Mr. Geithner). He has been in this crisis to his eyeballs. He has experience on both sides, Treasury and the Fed, and certainly that’s good,” said Robert Brusca, chief economist at consultancy FAO Economics, who expected the two government agencies to closely cooperate in dealing with the financial crisis in the months ahead.
“But we’ll have to wait and see what Mr. Geithner does,” Mr. Brusca added.
Spokesmen at the Fed and the Treasury did not immediately return calls. But NBC News reported that Mr. Obama would unveil his economic team, including Mr. Geithner, on Monday in a bid to calm markets.
Mr. Geithner, 47, has played a leading role in the Fed’s efforts to deal with the credit crisis since subprime mortgage woes started roiling markets in August 2007. In particular, he oversaw the rollout of several new lending facilities aimed at helping Wall Street firms following the fall of Bear Stearns Cos. Inc. in March.
Before being named as New York Fed president in October 2003, Mr. Geithner had served for two years as director of the policy development and review department at the International Monetary Fund. He earlier served in various posts at the Department of Treasury, which he joined in 1988.
He was undersecretary for international affairs from 1999 to 2001 under Robert Rubin and Lawrence Summers, who had been rumored as a possible candidate for the top Treasury post under Obama.
Mr. Geithner also serves as chairman of the G-10’s Committee on Payment and Settlement Systems of the Bank for International Settlements.
Before the Geithner news, financial issues remained under pressure amid concern about Citigroup Inc.’s outlook.
Time You found time enough to love And I found love enough to hold you So tonight, I'll stir the fire you feel inside Until the flames of love enfold you
Layin beside you, lost in the feeling So glad you open my door Come with me Somewhere in the night we will know Everything lovers can know You're my song Music too magic to end I'll play you over and over again Lovin so warm, movin so right Closing our eyes, and feeling the light We'll just go on burning bright Somewhere in the night
You'll sleep when the morning comes And I'll lie and watch you sleeping And you'll smile, when you dream about the night Like its a secret you've been keeping
Layin beside you lost in the feeling So glad you open my door You're my song Music too magic to end I'll play you over and over again Lovin so warm, moving so right Closing our eyes and feeling the light We'll just go on burning bright Somewhere in the night We'll just go on burning bright Somewhere in the night
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Singapore’s Temasek cuts pay to combat slowdown
SINGAPORE, Nov 21 - Singapore’s state investor Temasek Holdings said on Friday it would cut pay across the board in a bid to slash costs as the firm projects tough economic conditions in 2009 and beyond.
Temasek, headed by Ho Ching, the wife of Singapore’s Prime Minister Lee Hsien Loong, said senior managers had volunteered to take a pay cut of between 15 and 25 percent.
“We anticipate a global recession in 2009 and possibly beyond. Therefore, Temasek will institute a firm-wide wage cut,” said Robert Chong, managing director of human resources at Temasek.
Chong also said the current crisis “will throw up tremendous opportunities” and that the majority of wage savings will be borne by their key managers. Temasek said it aimed to increase headcount by 15 percent over the next two years.
Temasek owns stakes in global banks such as Standard Chartered, Barclays, Merrill Lynch, Bank of China and India’s ICICI Bank, the stocks of which have all fallen as the credit crisis unfolded, some of them very sharply.
Final government data released on Friday confirmed that Singapore was in recession. The city-state’s economy shrank at a worse-than-expected rate of 6.8 percent on an annualised and seasonally adjusted basis in the third quarter, and the government said the economy may shrink next year.
谢国忠：解决问题需要政府大把掏钱启动内需
解决问题需要政府大把掏钱启动内需
——访玫瑰石顾问公司董事谢国忠先生
2008/11/03
来源：证券市场红周刊
《红周刊》:您此前一直看空,最近却突然“翻多”,这其中是何原因？
谢国忠:我没有“翻多”啊,只是说现在A股已经没有泡沫了,长线投资者可以买入了。现在中国的经济基本面在波动,如果你买入了好股票,且可以像巴菲特那样持有几年的话,未来很有可能赚钱。这些话,我在央视节目中有录影,白纸黑字可以查的。但是我不能保证你买入后,市场就一定会上涨。巴菲特买入后是不看股价的,如果你看了股价受不了中间的波动,please don't buy（请别买）。
《红周刊》:那您认为现在我们可以“抄底”了吗？
谢国忠:“捞底”是很不容易事情,搞不好进去就出不来了。“捞底”其实就是贪小便宜,但是也很可能吃大亏。你看中信泰富为了在汇率上赚取那么一丁点好处,没有料到却在杠杆外汇合约上巨亏了155亿港元。“捞底”你可能捞得到,也可能捞不到。如果你能看懂中国未来几年发展的话,现在就可以买入股票,像巴菲特那样通过长期持有获利。
不过,我看A股 have relatively few good（几乎没有相对较好的）公司,贵州茅台(600519,股吧)相对来说盈利能力还可以,但是现在它的市场价格相对于盈利来说还不低。
中国经济可能“硬着陆”
《红周刊》:言下之意,您是看好中国未来的经济发展了？2004年时一位奥地利学派的经济学者克拉斯穆尔•佩佐夫曾预言中国将在2008～2009年陷入大萧条。
谢国忠:我不认为中国经济会崩溃。美国次贷危机是因为杠杆比例太高,而中国没有这么高的杠杆交易。中国的杠杆交易主要集中在企业,但比例也不是很高,而老百姓和政府的杠杠比例普遍较低,现在银行的存贷比还保持在70%左右,市场不会被大炒。美国的杠杆多高啊!Investment banks have（投行甚至达到了）30多倍!这么高的杠杆在市场上吹起了很多资本泡沫。中国没有这么高的融资比例,经济即便下滑也不会到美国那样严重的地步。我们现在的任务不是来讨论杠杆问题,而是怎样去“保增长”的问题。
现在,中国经济可能“硬着陆”,作为国民经济支柱产业的房地产市场有价无市,未来将继续降价,房价必须降到老百姓都能买得起的价位。而国际经济对中国出口产品的拉动作用又在减小。现在你随便去广东、江浙一带看看,就知道问题有多严重了。玩具厂、鞋厂,大量做出口的工厂关门倒闭了,而去年出口经济占到中国GDP的40%。所以,我预计未来几个季度中国经济增长速度必然放缓。
《红周刊》:这从三季报中可以看出,上市公司主营环比下降了3.22%,净利润环比下降了19.9%。
谢国忠:有些中国企业缺乏竞争力,去年他们拿了钱就知道去炒房子、炒股票,结果现在亏得一塌糊涂。不过,去年上市公司靠炒股在二级市场上赚了很多钱,他们通过交叉持股或者通过财务手段私自转移企业的钱到股市中。这掩盖了上市公司真正的盈利水平。我认为去年的盈利中至少有30%的水分要挤掉,但是中国企业非常不透明,没有办法查到具体的数据。譬如白色家电行业,现在出口面临问题,库存压力又大,但是你去看看利润表依然虚高。据我了解,有些公司就是把产品卖给了自己的贸易公司,账面上全是应收账款。
目前需要解决四大问题
《红周刊》:如此说来,未来最重要的动力还是内需？
谢国忠:内需？农民手中没有钱,花什么？现在中国农民全年总收入才3000多元/人。国内农产品价格长期低于国际农产品价格,造成农民收入偏低。即使现在国际农产品价格出现回调,但是中国农产品价格与之相比还有一定差距。所以国家必须要补贴农业,提高农民收入,才能启动农村巨大的消费需求。前段时间,发改委等将明年的白麦、红麦收购价格提高了15%,但与国际价格仍有距离。
《红周刊》:现在农业类上市公司很热,您看好哪家公司？
谢国忠:至于说到农产品上市公司,我认为没有一个好的,全部都是炒作概念,还没有出现真正有技术的农业公司。现在市场上热炒的北大荒(600598),是因为它有很多土地出租。生产化肥的公司之前因为能源价格上涨影响利润,现在能源价格下跌了,企业的生产成本降低了很多。像这样的农业类公司我才最看好,第一种是孟山都这样的,在生物制种技术方面拥有优势的跨国公司;第二种就是从事农业的trading companies（交易型公司）,只有这些公司才有机会。
《红周刊》:对中国经济未来1～2年的发展,您怎么看？中国可以避免佩佐夫所说的萧条吗？
谢国忠:原油价格还在跌,跌到了60美元/桶,欧佩克宣布要减产,美国经济已不可避免地进入衰退。
从短期看,因为需求放缓,中国经济的确面临着通缩的压力,但是资金供应量、劳动力成本以及资产价格的上涨还预示着未来经济可能继续通胀。通缩主要是出口需求减少导致的,通缩比通胀好解决。美联储主席伯南克是我的校友,就说如果有必要,就用直升飞机撒钱,看它还通缩不通缩!
出口放缓后,政府提出了产业升级、产业结构转型,我看这是在喊口号。在中国目前我还没有看到具体的、真正有效的措施来实施产业结构转型的。中国要想避免萧条,实现经济增长,需要动大手术,目前要解决四个方面的问题:地方财政困难、出口行业问题、房地产市场、工业品积压。当然了,解决这些问题需要政府大把掏钱启动内需。这次政府大量推进铁路建设投资就没错。
《红周刊》:可钱从哪来？市场上流传说中国的钱都去美国抄底了。
谢国忠:这是不一样的概念,你去翻翻经济学教科书就知道了。中国去买美国资产动用的是外汇储备,跟国内的钱是两码事,国内货币供应量同外汇储备是分开的。政府在国内可以大量地发行国债啊!大家往往不搞清楚就喜欢乱担心。
《红周刊》:糟糕的美国把您的校友伯南克搞得挺郁闷,这不,美国又降息了,您怎么评价？
谢国忠:今天的问题都是昨天造成的。现在美国资产价格下降预期很高,降息后银行还是不敢往外借贷,而资产所有者照样是借不到钱。降息只是暂时减轻了债务人的负担,房地产行业过快发展吹起的泡沫很难一下消除。
现在美元暂时走强了,但是明年我预计压力很大。美元最近走强与美国贸易逆差有关,从长期来看,美国存款利息这么低,经济情况又这么差,明年美元可能面临很大压力。我认为如果手中有美元的话,最好把它换成美股,最近美股的市净率约在1.6倍左右,够便宜。熊市中最低可能低于1.5倍,但你买入后不一定立马就会上涨。
《红周刊》:佩佐夫认为高速扩张的信贷收缩后中国经济会崩溃,但最后得出的结论却是这场危机后,中国凤凰般地涅磐成为世界领袖,您认同他这一观点吗？
谢国忠:因为汇率不能动,在贸易顺差的情况下,央行扩张信贷是为了对冲风险。但是这个风险也不能完全对冲掉,日本、英国目前已经有2个季度进入了衰退。你说中国可以领导世界吗？我觉得有吹嘘的成分。中国的体制存在着很大的缺陷,经济发展不是靠市场调节,它是靠政府去推动,这些必须都要改革。
但是也说不定,在政府的主导下,市场又起来一波经济快速增长。To lead the world,China must become market oriented and have a convertible exchange rate（要想领导世界,中国必须成为市场主导以及汇率自由浮动）。从这次的亚欧峰会上看,没有讨论stabilizing the global economy（稳定全球经济）,只是讨论了金融改革。金融改革这是多么遥远的事情啊。嗯,有点遗憾。
Junk Bond Yields Reach Record 20% as Economy Declines
By Gabrielle Coppola and Caroline Salas
Nov. 19 (Bloomberg) -- Yields on speculative-grade corporate bonds surpassed 20 percent for the second straight day as a declining economy increased the risk of default.
The average yield on high-yield, high-risk debt rose to 20.81 percent today, from 20.14 percent on Nov. 18, the previous record, according to Merrill Lynch & Co.'s U.S. High Yield Master II index. The level is the highest since Merrill began collecting overall yield data in January 1986.
Junk bonds have lost more than $187 billion in market value since August on speculation the U.S. recession will leave a glut of companies unable to meet their debt payments, Merrill data show. General Motors Corp.'s announcement Nov. 7 that it may run out of operating cash as soon as this year stoked default concerns, said Martin Fridson, chief executive officer of money management firm Fridson Investment Advisors in New York.
``Prices are in a virtual freefall,'' Fridson said. ``Either the market is right and expecting a default rate considerably higher than it was in the Great Depression, or we have such profound dislocations and selling pressures going on that it really is creating extraordinary fundamental value.''
About 72 percent of high-yield issuers have bonds trading at so-called distressed levels, or with yields of at least 10 percentage points more than similar-maturity Treasuries, Merrill data show. That ratio implies a default rate of 18 percent in the next 12 months, according to Fridson.
`Economic Backdrop'
Before this year, the record high for speculative-grade bond yields was 18.3 percent in October 1990, when the yield on 10- year Treasuries was about five percentage points higher than it is now, Fridson said. High-yield, or junk, bonds are those rated below Baa3 by Moody's Investors Service and lower than BBB- by Standard & Poor's.
``People are just worried about the economic backdrop, they're worried about rising defaults,'' said Stephen Antczak, a credit strategist at UBS AG in Stamford, Connecticut.
Moody's increased its forecast for high-yield corporate defaults on Nov. 12 to more than 10 percent in the next 12 months, citing a ``deep and protracted'' recession in the U.S. The credit rating company had predicted a 7.9 percent high-yield default rate a month earlier.
The number of companies at risk of running out of cash reached the highest level since 2002 in October, Moody's said in a Nov. 17 report. As of October, 14 percent of rated companies had an SGL-4 ranking, Moody's lowest level of liquidity rating, up from 12.6 percent in September, the report said. That's the highest percentage since 2002, when Moody's began tracking the data.
Automakers Before Congress
General Motors, Ford Motor Co. and Chrysler LLC, the three largest U.S. automakers, are lobbying Congress today for government aid to stave off bankruptcy.
Detroit-based General Motors, its financing arm GMAC LLC, and GMAC's mortgage unit Residential Capital LLC are three of the four worst performers this month of the 50 biggest issuers in the high-yield market, according to Merrill. GM has lost 29.5 percent, GMAC is down 23 percent and ResCap securities have tumbled 45 percent on average, Merrill data show.
GM's $3 billion of 8.375 percent bonds due in 2033 fell 0.25 cent to 18.75 cents on the dollar at 11:51 a.m. in New York, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The debt yields 44.5 percent, or 40 percentage points more than similar-maturity Treasuries, Trace data show.
Freescale
Freescale Semiconductor Inc. bonds have also lost 27 percent in November, tumbling after Intel Corp. heightened concern the financial crisis is stifling global technology spending by slashing its fourth-quarter sales forecast by about $1 billion. Austin, Texas-based Freescale was taken private in 2006 for $17.6 billion by a group led by Blackstone Group LP.
``The near-term pressures are very challenging,'' said Antczak. ``There's no reason'' relative yields won't continue to rise.
The extra yield, or spread, investors demand to own junk bonds instead of Treasuries rose for the fifth day in a row, increasing 53 basis points yesterday to a record 17.96 percentage points, according to Merrill Lynch. The average price has fallen to 59.5 cents from 85.6 cents on Aug. 31, wiping out more than $187 billion in market value, Merrill data show.
``The risk premiums are just at a staggering level,'' said Fridson. ``The number is not something any of us expected to see,'' he said, referring to the 20 percent yields.
Berkshire Asked by SEC in June for Derivative Data
By Erik Holm
Nov. 21 (Bloomberg) -- Warren Buffett's Berkshire Hathaway Inc. provided more details on $37 billion of derivative bets after the U.S. Securities and Exchange Commission asked in June for ``more robust disclosure'' on how it values the contracts.
Berkshire doesn't have to buy the securities that underlie the derivatives, the Omaha, Nebraska-based firm said in an October 3 letter to the SEC released today. A subsequent SEC letter to Berkshire, dated Oct. 7, said its review of the company was completed, with no further comments.
The SEC contacted Berkshire Chief Financial Officer Marc Hamburg with the request for more information before investor concern about the derivatives, a bet on the world stock markets, contributed to a 20 percent decline in the firm's shares in the past two weeks. The exchange of letters was released by the SEC today.
Hamburg told the SEC in July that the company values derivative contracts using a model that includes equity prices, interest rates, market volatility and the dollar's performance against other currencies -- language the firm repeated in subsequent quarterly filings. The response was part of a four- month long exchange of letters that also concerned Berkshire's fixed-income investments and its insurance operations in Europe.
Jackie Wilson, a spokesman for Berkshire, didn't return an e-mail seeking comment. John Nester, a spokesman for the SEC, declined to comment.
Derivative Bets
Buffett sold the derivative contracts to undisclosed buyers for $4.85 billion to protect them against declines in four stock markets, including the Standard & Poor's 500 Index.
Under the agreements, Berkshire will pay as much as $37 billion if, on specific dates beginning in 2019, the indexes are below the point where they were when he made the agreements. By Sept. 30, Berkshire had written down the contracts by $6.73 billion as the S&P declined for a fourth straight quarter.
``I believe these contracts, in aggregate, will be profitable,'' Buffett said in a statement in May, reiterating comments from his letter to shareholders in February. ``We are always ready to trade increased volatility in reported earnings in the short run for greater gains in net worth in the long run. That is our philosophy in derivatives as well.''
Stake in Moody's
The SEC also asked for information about Berkshire's stake in Moody's Corp., the ratings firm. Connecticut's attorney general said in May he was investigating possible conflicts concerning Berkshire's bond-insurance unit and its ownership of Moody's stock.
Berkshire said in its response to the SEC that it ``could not control or significantly influence the management or operating practices at Moody's.'' Berkshire paid about $2 million to Moody's last year for ratings services, Hamburg said in the letter.
Buffett, ranked the richest American by Forbes magazine, transformed Berkshire from a failing textile maker into an enterprise with businesses ranging from ice cream and underwear to corporate jet leasing.
Berkshire today rose 16 percent, the most since at least 1987, to close at $90,000 in New York Stock Exchange composite trading. Until this week, the stock hadn't ended a day below $100,000 since 2006.
Citigroup stock dive rebuffs claim by Treasury's Paulson
The financial giant's shares lead a meltdown in financial issues just one week after Paulson says he believes 'the banking system has been stabilized.'
By Tom Petruno
November 21, 2008
Many things that Treasury Secretary Henry M. Paulson has said about the credit crunch and financial markets have come back to haunt him.
Now many investors appear to expect a U.S. rescue of Citigroup Inc. -- just one week after Paulson sought to assure the American people that the banking system has "been stabilized."
Citigroup shares dived $1.69, or 26.4%, to $4.71, leading another meltdown in financial shares, as investors bailed out on fears that the sinking economy could torpedo the financial giant. The plunge in financial issues Thursday helped drive the Standard & Poor's 500 index to an 11-year low.
Citigroup stock failed to get any lift from a promise by Saudi Prince Alwaleed bin Talal, who owns 4% of the firm, that he would boost his stake because he believes the shares are undervalued.
Once the government started pumping capital into banks last month, many investors assumed that the biggest institutions were at least assured of survival.
But the market clearly has major doubts about Citigroup, even with $25 billion in government capital now on its books.
That was evident Thursday in the market for insurance contracts known as credit default swaps, where the annual cost of insuring Citigroup bonds rocketed to $390,000 per $10 million of debt, from $240,000 on Tuesday, according to Reuters.
The cost surged even though the Federal Deposit Insurance Corp. has agreed to guarantee U.S. banks' debts.
Citigroup swaps "shouldn't be trading at these wide levels if in fact there's a backstop from the Treasury, an implicit guarantee," Ricardo Kleinbaum, a credit analyst at BNP Paribas in New York, told Reuters.
One week ago, Paulson was confident that investors were over the worst of their concerns about the banking system. In an NPR interview, he said: "I believe the banking system has been stabilized. No one is asking themselves anymore, is there some major institution that might fail, and that we would not be able to do anything about it. So I think that is a positive."
When the interviewer pressed Paulson on the idea of another major failure, the Treasury chief didn't flinch.
"I got to tell you, I think our major institutions have been stabilized," he said. "I believe that very strongly."
US will guarantee up to US$1.4T in bank debt
November 22, 2008
WASHINGTON (AP) - Federal regulators will guarantee as much as $1.4 trillion in U.S. banks' debt in a bid to get the distressed financial system pumping again.
They also took steps to make it easier for private investors to buy failed banks seized by the government.
Against a bleak economic backdrop, news that New York Federal Reserve President Timothy Geithner is President-elect Barack Obama's choice for Treasury secretary gave battered Wall Street a shot in the arm Friday.
The Dow Jones industrials zoomed nearly 500 points as stocks erased roughly half the losses racked up the prior two days.
Investors have been seeking a clear message from Obama on who will lead his economic brain trust during the financial crisis.
Directors of the Federal Deposit Insurance Corp. voted to approve the bank-debt guarantee program, which is part of the government's financial rescue package.
The FDIC program is meant to break the crippling logjam in bank-to-bank lending by guaranteeing the new debt in the event of payment default by the borrowing bank.
Some analysts have said that freeing up bank-to-bank lending with the guarantees won't necessarily translate into a thaw in broader lending as banks are still wary of making loans to businesses and consumers.
The FDIC also will guarantee deposits in non-interest-bearing "transaction'' accounts by removing the current $250,000 insurance limit on them through the end of next year.
That could add as much as $500 billion to FDIC-backed deposits.
Short-term debt issued by banks - for 30 days or less - is not covered as to avoid creating more volatility for the Federal Reserve's primary interest rate.
The Fed on Oct. 29 slashed the rate to 1 percent, a level seen only once before in the last half-century.
Many economists predict the Fed will lower rates again next month at its last meeting of the year.
Treasury Department spokeswoman Brookly McLaughlin on Friday called the FDIC action "an important step to strengthen the financial system by increasing confidence in the markets.''
Elsewhere, the Office of the Comptroller of the Currency, which oversees national banks, issued its first approval of a new kind of bank charter intended to increase the "pool of potential buyers'' of failed banks.
The Treasury Department agency said the new charter is intended for private investors interested in bidding on troubled banks that have been taken over by the FDIC.
The first preliminary approval went to Ford Group Bank, whose owners include Hilltop Holdings, Inc., an investment vehicle for Texas billionaire Gerald J. Ford.
Twenty-two federally-insured banks and thrifts have failed this year, compared with three for all of 2007.
Failures continued apace on Friday, as regulators shut down two big thrifts based in Southern California - Downey Savings and Loan Association and PFF Bank & Trust - saying they fell victim to the acute distress in the housing market in that state.
Thrifts differ from banks in that, by law, they must have at least 65 percent of their lending in mortgages and other consumer loans - making them particularly vulnerable to the persistent housing downturn.
Also shuttered Friday was The Community Bank, a small bank in Loganville, Georgia. It's expected that many more banks won't survive the next year of economic tumult.
While the FDIC threw a blanket of guarantees over U.S. banks, President George W. Bush ensured that millions of laid-off workers will keep getting their unemployment checks as the year-end holidays approach.
Bush signed an extension of jobless benefits into law just before he left for Lima, Peru, to attend the 21-nation Asia-Pacific Economic Cooperation forum.
Still, a Federal Reserve official warned Friday that the economy's weakness will stretch well into next year.
"We likely are in for a protracted period of poor economic performance,'' said Charles Evans, president of the Federal Reserve Bank of Chicago.
Many analysts believe the economy will continue to shrink through the rest of this year and into the next, more than meeting a classic definition of recession.
Investors were discouraged earlier this week by the inability of the White House and Congress to agree on a plan to provide relief to the battered U.S. auto industry.
Hearings are expected the week after next and lawmakers could consider legislation in December.
Other federal actions to resuscitate an economy crippled by home foreclosures, a credit freeze and confusion in financial markets will probably have to wait until January.
Obama has pledged to make economic recovery the immediate focus of his new administration, and both the House and Senate will have increased Democratic majorities eager to support him.
Banking baddies get help but Europe's car industry is left to languish
David Gow in Brussels
November 19 2008
Bankers are now the most hated professionals, more so even than politicians and journalists. Through reckless greed and the selfish pursuit of their annual bonus, they brought the west's financial system to its knees. They ripped off their loyal individual customers with excessive charges and called on their retail investors, whom they viewed with contempt, to bail them out when in trouble.
And now, when European governments alone have committed to them €2.2trillion (£1.8tn) in fresh capital and loans guarantees, they are helping to deepen the recession by refusing to lend to vital small businesses – and to the car industry, a core element of the manufacturing sector.
The European commission, the chief guardian of the EU's competition rules, is happily turning a blind eye to "moral hazard" and allowing a host of governments to rescue banks that were the architects of damage to themselves and the wider economy. At the same time, it is getting sniffy or even downright hostile with governments shaping up to save hundreds of thousands of jobs for car workers.
Why this ambivalence – mirrored in the US where the lame duck Bush administration is refusing to raid the $700bn (£465bn) toxic asset relief programme (Tarp) to aid the "big three" carmakers? First and foremost, says Neelie Kroes, the EU competition commissioner, the financial sector cannot be compared to the car sector. "If your financial system is not working any more, then it's over. That was our incentive to give medicine to its blood circulation," she said in Paris this week.
Her aides put it like this. "Systemic risk, old chap." That is, if one bank goes down, the spillover effect could bring others to their knees in its wake and put an entire economy at risk. So bankers lacking even elementary social responsibility, let alone social consciences, are rescued by society as a whole.
Carmakers, on the other hand, are held to account for the undoubted errors of judgment and management they have made and offered, at most, limited aid. The €1bn loan guarantees for Opel, part of General Motors, being considered by the German chancellor, Angela Merkel, will, one is told, be ruled out of order on competition grounds – under the same state aid rules, of course, that have been bent to bail out banks. "Banks can ask for anything they want and get it," says one exasperated industry source.
The commission is worried that soft loans on the scale Merkel is examining could simply flow across the Atlantic to the mothership in Detroit and bail out GM. Both she and Carl-Peter Forster, the head of GM Europe, insists they won't.
But, leaving that aside, is there no "systemic risk" if Opel, already owed €1bn by GM, goes down and takes 100,000 jobs with it? Probably lots more if other German carmakers, also afflicted by declining sales in the credit crunch, and suppliers are put at risk. The sector directly and indirectly employs 1.2 million people in Germany alone.
So important is it that one of the German government's "five wise men", its group of official economic advisers, is proposing that Opel be temporarily nationalised, on the same lines as some European banks. It could then be sold to private investors or merged with another less stricken firm. Opel's problems are, largely, not homemade: they stem 80% from the misguided executive team in Detroit, according to one respected analyst.
This cuts little mustard in Brussels where, despite the critical chants of the non-governmental organisations and green campaigners about its lobbying muscle over carbon emissions, the European auto industry carries less political weight than it does in the US. It has the support of Guenter Verheugen, the much-diminished industry commissioner and lobbyist, but the commission as a whole rejects his "blank cheque" approach.
The industry bitterly contrasts the support promised for a "strategic" sector by the US president-elect, Barack Obama, with the piecemeal, reluctant attitude of the EU. Obama is viewed as seeing the car sector as the backbone of US manufacturing and as being prepared to offer it incentives not just to retool for "green" technologies but to recover and sustain employment.
Next week, when the commission lays out its proposals for steering the European economy out of crisis, there may be measures for the motor manufacturing sector such as incentives for consumers to scrap their gas-guzzling old bangers and gear up to more fuel-efficient vehicles. The European Investment Bank will also scale up its loan facilities – €7bn in recent years - for the industry under its climate change package. But the amount will be nothing like the €40bn sought by the industry.
This hardly squares with the enormity of the bailout for the banks. Kroes argues that she, too, isn't offering any blank cheques to the financial sector, pointing to the tough conditions – no dividends until preference shares are repaid, reduced or scrapped bonuses, lower fixed salaries etc – she has imposed in approving rescue packages. Restructuring plans have to be submitted after six months.
"You shouldn't run away with the idea that the commission is handing out money willy nilly to banks," her aides say. The German government aid for Commerzbank, for instance, has been held up because the interest coupon (8%) is considered too low (a minimum 10% is required).
But there is little evidence so far that the banks will change their ways if and when the crisis is over. Sure, Rod Kent, the former Bradford & Bingley chairman, has said the bank is "massively sorry". Josef Ackermann, the Deutsche Bank chief, who has waived his bonus this year (he earned a mere €14m last year), has admitted to failings and to the inevitability of greater regulation.
He's talking of a Damascene conversion – similar to the "cultural shift" signalled this week by the UBS chairman, Peter Kurer, when he set out the Swiss bank's tough new remuneration policy and said the era of mega-bonuses was over. But, if the general recovery begins in 2010, so will in all likelihood the revival of bonus and stock options handouts. A shrunken auto industry may tell a different story. Bloated bankers count; careworn carworkers don't.
Geithner report sends stocks skyrocketing
By Isabelle Clary
November 21, 2008
U.S. stocks soared in late afternoon trading on news that Timothy Geithner, president of the Federal Reserve Bank of New York, was President-elect Barack Obama’s choice for Treasury secretary.
The Dow Jones industrial average closed up 494.13, or 6.54%, at 8,046.42; the S&P 500 rose 47.59, or 6.32%, closing at 800.03; and the Nasdaq composite was up 68.23, or 5.18%, to close at 1,384.35. All numbers are preliminary.
The Dow was down about 30 points when news of Mr. Geithner’s appointment this afternoon sent the blue-chip index surging.
“The markets are reacting well and seem to have a good view of him (Mr. Geithner). He has been in this crisis to his eyeballs. He has experience on both sides, Treasury and the Fed, and certainly that’s good,” said Robert Brusca, chief economist at consultancy FAO Economics, who expected the two government agencies to closely cooperate in dealing with the financial crisis in the months ahead.
“But we’ll have to wait and see what Mr. Geithner does,” Mr. Brusca added.
Spokesmen at the Fed and the Treasury did not immediately return calls. But NBC News reported that Mr. Obama would unveil his economic team, including Mr. Geithner, on Monday in a bid to calm markets.
Mr. Geithner, 47, has played a leading role in the Fed’s efforts to deal with the credit crisis since subprime mortgage woes started roiling markets in August 2007. In particular, he oversaw the rollout of several new lending facilities aimed at helping Wall Street firms following the fall of Bear Stearns Cos. Inc. in March.
Before being named as New York Fed president in October 2003, Mr. Geithner had served for two years as director of the policy development and review department at the International Monetary Fund. He earlier served in various posts at the Department of Treasury, which he joined in 1988.
He was undersecretary for international affairs from 1999 to 2001 under Robert Rubin and Lawrence Summers, who had been rumored as a possible candidate for the top Treasury post under Obama.
Mr. Geithner also serves as chairman of the G-10’s Committee on Payment and Settlement Systems of the Bank for International Settlements.
Before the Geithner news, financial issues remained under pressure amid concern about Citigroup Inc.’s outlook.
Somewhere In The Night - By Barry Manilow
Time
You found time enough to love
And I found love enough to hold you
So tonight, I'll stir the fire you feel inside
Until the flames of love enfold you
Layin beside you, lost in the feeling
So glad you open my door
Come with me
Somewhere in the night we will know
Everything lovers can know
You're my song
Music too magic to end
I'll play you over and over again
Lovin so warm, movin so right
Closing our eyes, and feeling the light
We'll just go on burning bright
Somewhere in the night
You'll sleep when the morning comes
And I'll lie and watch you sleeping
And you'll smile, when you dream about the night
Like its a secret you've been keeping
Layin beside you lost in the feeling
So glad you open my door
You're my song
Music too magic to end
I'll play you over and over again
Lovin so warm, moving so right
Closing our eyes and feeling the light
We'll just go on burning bright
Somewhere in the night
We'll just go on burning bright
Somewhere in the night
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