Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: TobagoJack who wrote (29433)	2/14/2008 10:01:09 AM
From: elmatador	Respond to of 218700

Even the Financial Times surrenders to the evidence! It is credit business much as usual in Brazil's markets By Jonathan Wheatley in São Paulo Published: February 13 2008 02:00 \| Last updated: February 13 2008 02:00 Brazil's credit markets are shrugging off the effects of the US subprime mortgage debacle and maintaining business largely as usual - another sign say analysts of emerging markets "decoupling" from developed ones. ELMAT: Looks like they gave up the hope of a "flight to quality" Mr. TJ! "Very little has changed in Brazil's as a result of the crisis," says Antonio Quintella, head of Credit Suisse's Brazilian operation in São Paulo. "Of course conditions are somewhat more difficult, spreads are up and the pace of business is slower but, overall, credit markets are calm." Brazil's capital markets as a whole have been far from immune from global instability. The São Paulo Stock Exchange (Bovespa), which since 2004 has seen a flood of companies coming to market after years of inactivity, has again ground to a halt. Last year, 64 companies floated on the main market of the Bovespa, raising R$55.5bn ($31.9bn). This year, not one has floated. Carlos Alberto Rebello, head of listings at the CVM, Brazil's securities commission, says 15 companies have suspended requests for share issues with a combined value of about R$7.7bn. Another 14 have failed to launch roadshows for offers worth another R$6bn. A further 14 issues worth about R$10bn are due between February and April. "I doubt very much if they will stick to their timetables," Mr Rebello says. Those companies that floated last year have been particularly badly hit by falls in stock prices this year, falling much further than the main Bovespa index. Some 75 per cent of their shares were sold to foreign investors, who have turned to the Bovespa's liquid market to raise cash to cover losses elsewhere. But Mr Quintella says companies have found it relatively easy to raise capital from other sources. Bank lending is the biggest, and the most visible example is Vale, the Brazilian mining giant, which has reportedly had little difficulty raising a loan of $50bn for its bid for Xstrata, its Anglo-Swiss rival. It is understood that JPMorgan offered Vale $10bn that it did not need. In Brazil, companies have benefited from a steady expansion of available credit. Brazil's total stock of credit, at about 35 per cent of gross domestic product, is still much smaller than in many other markets. Brazilian companies have much less debt than many foreign competitors so their situation, says Mr Quintella, "is still relatively comfortable". Some analysts have warned that, because Brazilian banks raise some of their capital overseas, the credit that has driven recent growth on Brazil's domestic market is bound to dry up. But Mr Quintella disputes this, pointing out that the steady advance in savings in Brazil has been driven by investments in fixed income instruments that are, in effect, closed to foreigners by taxation. "Our sources of credit are essentially domestic," he says. Most economists believe Brazil is bound to be hurt by the expected slowdown in the US and global economies this year. But many companies are betting on the domestic market to make up the difference. For them, investment capital is still available. Copyright The Financial Times Limited 2008 Print articleEmail articleOrder reprints

To: TobagoJack who wrote (29433)	2/14/2008 2:28:23 PM
From: Elroy Jetson	Respond to of 218700

Predatory Lenders' Partner in Crime How the Bush Administration Stopped the States From Stepping In to Help Consumers By Eliot Spitzer - Washington Post - Thursday, February 14, 2008 washingtonpost.com Several years ago, state attorneys general and others involved in consumer protection began to notice a marked increase in a range of predatory lending practices by mortgage lenders. Some were misrepresenting the terms of loans, making loans without regard to consumers' ability to repay, making loans with deceptive "teaser" rates that later ballooned astronomically, packing loans with undisclosed charges and fees, or even paying illegal kickbacks. These and other practices, we noticed, were having a devastating effect on home buyers. In addition, the widespread nature of these practices, if left unchecked, threatened our financial markets. Even though predatory lending was becoming a national problem, the Bush administration looked the other way and did nothing to protect American homeowners. In fact, the government chose instead to align itself with the banks that were victimizing consumers. Predatory lending was widely understood to present a looming national crisis. This threat was so clear that as New York attorney general, I joined with colleagues in the other 49 states in attempting to fill the void left by the federal government. Individually, and together, state attorneys general of both parties brought litigation or entered into settlements with many subprime lenders that were engaged in predatory lending practices. Several state legislatures, including New York's, enacted laws aimed at curbing such practices. What did the Bush administration do in response? Did it reverse course and decide to take action to halt this burgeoning scourge? As Americans are now painfully aware, with hundreds of thousands of homeowners facing foreclosure and our markets reeling, the answer is a resounding no. Not only did the Bush administration do nothing to protect consumers, it embarked on an aggressive and unprecedented campaign to prevent states from protecting their residents from the very problems to which the federal government was turning a blind eye. Let me explain: The administration accomplished this feat through an obscure federal agency called the Office of the Comptroller of the Currency (OCC). The OCC has been in existence since the Civil War. Its mission is to ensure the fiscal soundness of national banks. For 140 years, the OCC examined the books of national banks to make sure they were balanced, an important but uncontroversial function. But a few years ago, for the first time in its history, the OCC was used as a tool against consumers. In 2003, during the height of the predatory lending crisis, the OCC invoked a clause from the 1863 National Bank Act to issue formal opinions preempting all state predatory lending laws, thereby rendering them inoperative. The OCC also promulgated new rules that prevented states from enforcing any of their own consumer protection laws against national banks. The federal government's actions were so egregious and so unprecedented that all 50 state attorneys general, and all 50 state banking superintendents, actively fought the new rules. But the unanimous opposition of the 50 states did not deter, or even slow, the Bush administration in its goal of protecting the banks. In fact, when my office opened an investigation of possible discrimination in mortgage lending by a number of banks, the OCC filed a federal lawsuit to stop the investigation. Throughout our battles with the OCC and the banks, the mantra of the banks and their defenders was that efforts to curb predatory lending would deny access to credit to the very consumers the states were trying to protect. But the curbs we sought on predatory and unfair lending would have in no way jeopardized access to the legitimate credit market for appropriately priced loans. Instead, they would have stopped the scourge of predatory lending practices that have resulted in countless thousands of consumers losing their homes and put our economy in a precarious position. When history tells the story of the subprime lending crisis and recounts its devastating effects on the lives of so many innocent homeowners, the Bush administration will not be judged favorably. The tale is still unfolding, but when the dust settles, it will be judged as a willing accomplice to the lenders who went to any lengths in their quest for profits. So willing, in fact, that it used the power of the federal government in an unprecedented assault on state legislatures, as well as on state attorneys general and anyone else on the side of consumers. The writer is governor of New York. .

To: TobagoJack who wrote (29433)	2/14/2008 2:55:47 PM
From: Elroy Jetson	Read Replies (2) \| Respond to of 218700

Bond insurers have 4 to 5 days to re-capitalize themselves enough to keep their crucial AAA credit ratings, New York Governor Eliot Spitzer said during a Congressional hearing on the $2.4 trillion industry on Thursday. If that doesn't happen, regulators will have to step in and separate bond insurers' municipal businesses from their more troubled structured finance units. "We will need to move in that direction. It is not our first choice but time is short," Spitzer said. "In the next four or five bus days we would like to see a resolution," Spitzer added. "It's time for deals to get done." MarketWatch - By Alistair Barr - Feb. 14, 2008 marketwatch.com