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

To: TobagoJack who wrote (40361)	9/25/2008 5:15:52 AM
From: dvdw©	Read Replies (1) \| Respond to of 218068

Savers mob Bank of East Asia over stability rumours by Staff Writers Hong Kong (AFP) Sept 24, 2008 Thousands of Hong Kong savers mobbed branches of Bank of East Asia on Wednesday to withdraw deposits, as the bank scrambled to reassure them it was not overexposed to Lehman Brothers and AIG. Police were called in to control the crowds after text messages flashed across the city warning the bank was unstable as it held a large number of assets linked to the failed Wall Street bank and the troubled insurance giant. But BEA and the city's financial authorities moved quickly to rebuff the claims, insisting the bank was in a solid financial position. "It has come to the notice of The Bank of East Asia (BEA)... that malicious rumours have been circulated questioning the stability of the bank," the bank said in a statement. "The management of BEA hereby states in the strongest possible terms that such rumours have no basis in fact. The management further confirms that the bank's financial position is sound and stable." Hundreds gathered outside branches across the city and the bank extended opening hours for several hours to try and deal with the rush of customers. "I hope it is just panic, but you never know. I am going to take my money out and put it in another bank," said public relations worker Ada Ho, outside a city centre branch. Ho said she read the rumours on the Internet. At one branch they issued IOUs and told people to come back in the morning to claim their deposits, an AFP photographer said. Up to 400 disgruntled savers, many of them elderly, had to be held back by police as they battled to get inside one branch of BEA in southern Hong Kong island before it closed, according to an AFP photographer at the scene. The bank's deputy chief executive, Joseph Pang, told Dow Jones Newswires that while there have been slightly more bank withdrawals than usual, the situation was "manageable." Pang said the bank first learned of the rumour on Monday, but didn't disclose it immediately because it wanted to avoid spreading panic. The statement said BEA's outstanding exposure was 422.8 million Hong Kong dollars (54.2 million US) to Lehman's and 49.9 million dollars to AIG. Its total consolidated assets stood at 396.6 billion Hong Kong dollars on June 30, with a capital adequacy ratio of 14.6 percent, well above the international required level, the statement added. The Hong Kong Monetary Authority (HKMA), the city's de facto central bank, insisted the banking system was "safe and sound." "Local banks are well capitalised and highly liquid... The rumours of the financial instability of BEA are unfounded," it said in a statement. Joseph Yam, HKMA's chief executive, said it would provide liquidity if BEA required it, but no request had been made. He said the police would investigate who started the rumour. Shares in the bank dropped as much as 11.3 percent in afternoon trade on the Hong Kong Stock Exchange after falling 6.9 percent over the past two trading days. However, after the bank's statement its shares rallied in late trade to close down 6.9 percent on the day. The drama came just days after the company was forced to restate its earnings downwards by almost 12 percent, after it found that one of its workers had buried losses from an unauthorised trade. The bank wrote-down its profits after it found the 93 million Hong Kong dollar trading loss, which it attributed to "an unauthorised manipulation of the valuation of certain equity derivatives held by the bank," the Financial Times reported. The bank's chairman is Hong Kong tycoon David Li, a member of one of Hong Kong's most powerful families, which has been prominent for five generations in business and politics. His grandfather founded the Bank of East Asia in 1918 and the lender boasts one of the biggest branch networks in mainland China among Hong Kong lenders. Hong Kong investors reluctance to heed government assurances may be linked to the collapse of Bank of Credit and Commerce International in the early 1990s. The government issued a statement at the time saying that the Hong Kong arm of the bank was "sound and viable" and encouraged investors to stop withdrawing cash. But just days later they were forced to liquidate the bank, leaving many savers in the lurch. Community Email This Article Comment On This Article

To: TobagoJack who wrote (40361)	9/25/2008 6:09:29 AM
From: elmatador	Respond to of 218068

Why crisis landed right into Congress? FED and Paulson know that they have also profited from the moolah flowing freely. US gorged in taxes from the profits of the financial sector. They basically say to Congress: "Look, once this hits the real economy, taxes will vanish, not much money for pork barrel and sweet deals on your constituencies... You have better contribute for an outcome here. But the politicos still don't know that they are going to face a long decade without much money to thrown at the constituencies once this debt increases...

To: TobagoJack who wrote (40361)	9/25/2008 6:14:32 AM
From: elmatador	Respond to of 218068

Freddie/Fannie Mae were nationalized to appease China: Probably about a quarter of China’s nearly $2,000bn (€1,300bn, £1,100bn) in foreign exchange reserves is invested in the bonds of government-linked US institutions such as Freddie Mac and Fannie Mae, which were in effect nationalised by the US government earlier this month. At least another quarter is in Treasury bonds and other US dollar assets Paulson and Benanke go to Congress and say: you'd better approve this elase China pulls the plug and we will do a 1980's Brazil... ft.com

To: TobagoJack who wrote (40361)	9/25/2008 10:06:47 AM
From: elmatador	Read Replies (1) \| Respond to of 218068

HK government, regulators and richest man came to the aid of Bank Of East Asia Ltd. after ``malicious rumors'' about its financial stability spurred the city's first bank run in more than a decade Hong Kong Calms Depositors After Bank East Asia Run (Update2) By Kelvin Wong and Theresa Tang Sept. 25 (Bloomberg) -- Hong Kong's government, regulators and richest man came to the aid of Bank Of East Asia Ltd. after ``malicious rumors'' about its financial stability spurred the city's first bank run in more than a decade. Financial Secretary John Tsang said the rumors were ``unfounded'' and the bank has enough capital to serve its clients. Joseph Yam, head of Hong Kong's central bank, urged depositors to stay calm and pumped $500 million into the banking system. Li Ka-shing, chairman of Cheung Kong (Holdings) Ltd., bought the stock. BEA shares rebounded and lines that had formed yesterday outside bank branches dried up, suggesting the effort to soothe depositors was succeeding. The bank said yesterday its ``exposure'' to bankrupt Lehman Brothers Holdings Inc. and American International Group Inc., taken over by the U.S. government, is about $61 million, less than 0.2% of assets. ``Their exposure should be limited,'' said Mona Chung, a fund manager who helps oversee more than $2 billion at Daiwa Asset Management Ltd., referring to AIG and Lehman. ``The reaction to those rumors seems a bit exaggerated. This is probably a bigger problem in the U.S. than for local banks.'' BEA's woes underline how a year of turmoil in financial markets has undermined confidence in the global banking system. Britain's government bailed out mortgage lender Northern Rock Plc last year after a run. The U.S. took over AIG, the world's biggest insurer, this month to prevent the worst financial collapse in American history. Li Rushes Back Chairman David Li rushed back to Hong Kong from the U.S. late yesterday to reassure clients and investors and said he's buying shares in the 90-year-old lender, the city's third-largest. ``The rumors were groundless,'' Li, 69, told reporters at Hong Kong's airport late yesterday. ``The bank has no problem.'' BEA rose 3.4 percent at 3:20 p.m. in Hong Kong trading after slumping yesterday. Lines outside the bank's branch on Des Voeux Road in the city's business district had dried up as of 11:30 a.m. Hundreds of depositors lined up yesterday outside its outlets in central Hong Kong, some of them to withdraw money. BEA issued a statement saying the rumors, spread by cell phone, were malicious and without basis and that its financial position is ``sound and stable.'' ``While we believe the risk profile of BEA has increased as a result of today's events, the lack of fundamental basis for the deposit outflows makes us believe this crisis will pass relatively quickly with limited financial impact,'' Credit Suisse Group analysts Christopher Esson and Frances Feng said in a note dated today. They kept their ``outperform'' rating on the stock. History of Crises Hong Kong hasn't had a bank failure since the Hong Kong Monetary Authority was founded in 1993, though it has a long history of financial crises associated with its lenders. There was a brief run on Standard Chartered Plc and Citigroup Inc.'s local unit after the failure of BCCI Group in 1991, while the failure of a small Hong Kong bank in the 1980s triggered runs on rivals and led to efforts to strengthen regulation. A banking crisis in 1965 prompted a government-backed takeover of Hang Seng Bank Ltd. by the Hongkong and Shanghai Banking Corp. for HK$51 million ($6.6 million). HSBC Holdings Plc now owns 62 percent of Hang Seng, which has a market value of $36.5 billion. Hong Kong's last bank run occurred in 1997, when International Bank of Asia suffered depositor withdrawals. On Nov. 11, 1997, the bank's then-Chief Executive Officer Mike Murad declared the run over. Under Hong Kong's deposit insurance program, bank depositors are protected up to HK$100,000 in the case of a bank failure. The government is reviewing whether to raise the protection cap to HK$200,000. The Hong Kong Monetary Authority injected HK$3.88 billion into the banking system today, after the interbank lending rate surged yesterday. `It Trust David Li' Cheung Kong spokeswoman Winnie Cheong said Li bought BEA shares yesterday with his own funds, though she didn't know the size of his purchase. BEA had HK$396.6 billion of assets as of June 30 and a capital adequacy ratio of 14.6 percent. ``I'm here not because I'm worried but just because my check needs to be cashed today,'' a 52-year old woman who gave her surname as Chiu said outside the Des Voeux Road branch today. ``I trust David Li, I may follow him to buy shares in BEA.'' She said she's been a BEA customer for 15 years and has about HK$1 million of total assets with the bank. BEA's image was tarnished on Sept. 18 as it reduced first- half profit by HK$109 million because of ``manipulation'' of the valuation on equity derivatives it holds. The restatement prompted Moody's Investors Service and Standard & Poor's to say they may cut BEA's credit ratings. Dow Jones Case Other banks moved to reassure the public about their finances. DBS Group Holdings Ltd., Southeast Asia's biggest lender by assets, said today its Hong Kong unit is ``in a strong financial and capital position.'' BOC Hong Kong (Holdings) Ltd., which bought a 4.94 percent stake in BEA in November last year, said today it will pay ``close attention'' to the lender and vowed to help ``sustain the stability of the bank.'' BEA's Li, a scion of one of Hong Kong's most prominent families, quit the city's cabinet in February after agreeing to pay $8.1 million in fines to the U.S. securities regulator for allegedly tipping off a friend about News Corp.'s takeover of Dow Jones & Co. Li agreed to pay the fine without admitting or denying wrongdoing. To contact the reporter on this story: Kelvin Wong in Hong Kong at kwong40@bloomberg.net

To: TobagoJack who wrote (40361)	9/25/2008 3:39:21 PM
From: dvdw©	Read Replies (2) \| Respond to of 218068

What is Up with this? China space mission article hits Web before launch Thu Sep 25, 9:20 AM ET BEIJING - A news story describing a successful launch of China's long-awaited space mission and including detailed dialogue between astronauts launched on the Internet Thursday, hours before the rocket had even left the ground. ADVERTISEMENT Email: ZIP / Postal Code: The country's official news agency Xinhua posted the article on its Web site Thursday, and remained there for much of the day before it was taken down. A staffer from the Xinhuanet.com Web site who answered the phone Thursday said the posting of the article was a "technical error" by a technician. The staffer refused to give his name as is common among Chinese officials. The Shenzhou 7 mission, which will feature China's first-ever spacewalk, is set to launch Thursday from Jiuquan in northwestern China between 9:07 a.m. EDT and 10:27 p.m. EDT. The arcticle, dated two days from now on Sept. 27, vividly described the rocket in flight, complete with a sharply detailed dialogue between the three astronauts. Excerpts are below: "After this order, signal lights all were switched on, various data show up on rows of screens, hundreds of technicians staring at the screens, without missing any slightest changes ... 'One minute to go!' 'Changjiang No.1 found the target!'... "The firm voice of the controller broke the silence of the whole ship. Now, the target is captured 12 seconds ahead of the predicted time ... 'The air pressure in the cabin is normal!' "Ten minutes later, the ship disappears below the horizon. Warm clapping and excited cheering breaks the night sky, echoing across the silent Pacific Ocean." Email Story IM Story Printable View Yahoo! Buzz RECOMMEND THIS STORY Recommend It: Average (170 votes) » Recommended Stories