Empiric Student Property Share Discussion Threads

[briarberry] 01/4/2008 18:02

ZURICH, Switzerland (AP) -- UBS AG's chairman abruptly resigned Tuesday as the Swiss bank reported a first-quarter loss of $12.1 billion and said it would seek $15.1 billion in new capital.
UBS revealed more serious damage from exposure to the U.S. subprime crisis and said it expects write-downs of approximately $19 billion.

[briarberry] 01/4/2008 06:37

LEH trying to raise $3bn

[briarberry] 31/3/2008 21:26

US food inflaton 8.9% y-o-y for a typical basket of groceries...


Every quarter since 1989, the American Farm Bureau Federation has conducted an informal survey to determine the price of a basket of 16 basic food items an average American would purchase at a local grocery store. A 20-ounce loaf of white bread, a 32-ounce bottle of vegetable oil, a gallon of whole milk and one pound of pork chops are among the items surveyed.

Thursday's report for the first quarter of 2008 saw an increase of $3.42, or 8.2%, to $45.03, from the previous quarter. The same standard bag of groceries was 8.9% more expensive than it was in the year-earlier quarter.

[briarberry] 31/3/2008 17:01

March 31 (Bloomberg) -- Japan's manufacturers cut production in February for a second month as the U.S., the country's biggest export market, verged on a recession.

Output fell 1.2 percent from January, when it slid a revised 2.2 percent, the Trade Ministry said today in Tokyo.

[briarberry] 30/3/2008 21:26

The Economy and Crude Oil - BY FRANK BARBERA, CMT

[briarberry] 30/3/2008 21:22

Copper - this is probably why copper stocks on the LME are so low...


Red Kite moves markets via the huge trades it executes. According to a prospectus sent to potential investors in 2006, Red Kite Metals at that time was borrowing an average of six times its investment pool, which an investor estimated at about $1 billion.

Stockpiling Copper

At the March 20 price, that would buy about 750,000 metric tons of copper, or almost four times the combined total metal stockpiles currently held at warehouses registered with the Comex division of the New York Mercantile Exchange, the Shanghai Futures Exchange and the LME.

``If you buy a million tons of copper, that's guaranteed to get the market up,''



Commodity Speculation

When one points to commodity inventories being at record lows, those inventories do not take into account all the speculative inventories. Red Kite admits being leveraged 6 times. And Red Kite is just one such company. How many more hedge funds are stockpiling metals and/or leveraging futures? In what amounts?

Regardless of what China and India are doing, in light of a slowing economy combined with pressure on the CME to do something about speculation, it's quite a leap of arrogance to believe "investment in the red metal can't lose". With enough leverage, anything can lose, even in mostly favorable conditions.

Mike "Mish" Shedlock

[briarberry] 29/3/2008 23:09

J. C. Penney the third-largest U.S. department-store chain

On Friday, J. C. Penney sharply cut its earnings forecast for the first three months of the year, by 33 percent, blaming the tough economy.

The chain said its first-quarter earnings would probably be 50 cents a share, compared with an earlier forecast of 75 cents to 80 cents a share. It estimates sales at stores open at least a year, a crucial yardstick in retailing, will fall by at least 10 percent in March.

Most retailers will report March sales next week.


(down 7% on Friday)

[briarberry] 29/3/2008 21:06

Bear Stearns, Jim Cramer, The Federal Reserve, JP Morgan

[briarberry] 29/3/2008 19:47

Food price inflation around the world, Vietnam...

Together with rising prices for other foods, like wheat, soybeans, pork and cooking oil, higher rice prices are also contributing to inflation in many developing countries. Retail rice prices have already jumped by as much as 60 percent in recent months in Vietnam, trailing increases in wholesale prices but leading a broader acceleration in inflation. Prime Minister Nguyen Tan Dung of Vietnam announced Wednesday that the government's top priority now was fighting inflation. Overall consumer prices are more than 19 percent higher this month than last March. . The inflation rate has nearly tripled in the last year.

[briarberry] 29/3/2008 17:55

UBS Lowers Price of Security Seen as 'Cash' Some Face Paper Losses Of More Than 20% On Auction-Rate Bonds
By EVELYN JUAN, JED HOROWITZ and ANDREW DOWELL - March 29, 2008

One of the world's biggest brokers is about to force its clients to take a haircut on a type of securities that investors had believed to be as safe as cash.

UBS AG began on Friday to lower the values of so-called auction-rate securities held by its clients, a move that will be a jolt to customers who had been told they were investing in a "cash alternative." The move is yet another way that the credit crunch that began with subprime mortgages has spread to unexpected places and upended conventional wisdom about the financial system.

The Swiss bank appears to be the first major firm to take this action and is expected to inform clients via their online statements shortly. The markdowns, which will be made using an internal computer model, will range from a few percentage points to more than 20%, a UBS broker said.

Other brokers are expected to follow and several are waiting for the end of the quarter in the coming week to make the decision.

Regulators are beginning to act. Also on Friday, Massachusetts's top securities regulator said he subpoenaed UBS along with Merrill Lynch & Co. and Bank of America Corp. for documents related to sales of auction-rate market securities to individual investors. In a statement, Secretary of State William Galvin said his office has received calls from many people who "thought they were investing in safe, liquid investments only to find that they had in fact purchased auction market securities that are now frozen and they cannot get their money."

Auction-rate securities are long-term bonds that were treated as short-term securities because investors could sell them at auctions that took place every few weeks, which also served to reset the interest rate the bonds paid. Auction-rate securities generally paid higher yields than savings accounts or money-market funds, so they became popular among investors looking for safe places to park cash. That has meant investors' can't get their cash, which in many cases was being stashed for immediate needs such as tuition, home down payment or medical needs.

In recent months, the auctions have failed, meaning not enough buyers showed up. Investment banks that typically stepped in to support the financings refused to do so because of their faltering balance sheets, driving down the price for these securities.

[briarberry] 29/3/2008 15:01

Copper, not much sign of a recession scare in the price yet. Demand is still high, inventories are very low. That 6% commodity price fall last week has largely been retraced. Even if China goes into recession, I expect them to keep modernising, with all their US$ reserves. Still if there is a global recession you'd still expect a correction (big dip) in the commoditiy bull ???

(see this update)
global copper inventories amount to only two weeks' demand. Lead stocks are closer to one week's worth. Stocks of oil are also unusually low. So even small disruptions to supplies prompt dramatic reactions from the markets.





?

Longer term, there's also...
recession/deflation scare vs stagflation/hyperinflation flight into things (bank collapse, dollar collapse = flight to real money: gold & commodities)

[briarberry] 28/3/2008 23:21

one of the now infamous mortgage backed security insurers...

S&P cuts FGIC to BB from A; now junk status

(fell 6% today)

[briarberry] 28/3/2008 19:54

Basra oil pipe ignited as Iraq fighting worsens
By Damien McElroy

An attack on an Iraqi oil pipeline has crippled the country's main crude pumping terminals, as fighting between Shi'ite factions and the security forces engulfed the south and centre of the country.

A fire was reported on the Zubair-1 pipeline, the main revenue earner for the Iraqi state, near Basra. The attack effectively brought all exports through Iraq's southern terminals to a halt.

[briarberry] 28/3/2008 13:02

March 28 (Bloomberg) -- More Chinese exporters are shunning the U.S. dollar and quoting prices in euros, pounds, and Australian dollars, the Financial Times reported, citing David Wei, chief executive of Alibaba.com Ltd., China's largest online commerce company.

The impact of the dollar's weakness has led Chinese exporters to question its role as the currency of choice, the newspaper said. Companies are shortening the period over which dollar prices are valid and setting their own exchange rates against the currency instead of using the official rate, effectively raising prices.

The yuan has appreciated 7 percent against the U.S. dollar in the past six months.

[briarberry] 28/3/2008 10:37

California freefall: Home prices down 26% in February
Signs of distress are piling up in the California housing market, where prices are falling at three times the national rate of decline.

--Statewide, median sales prices fell by a stunning 26% from year-ago levels in February, with home prices dropping at a rate of nearly $3,000 a week, the California Association of Realtors reports. Further, the CAR says the Fed's interest rate-cutting campaign "will have little near-term direct effect on the housing market."

Los Angeles Times

[briarberry] 27/3/2008 22:45

Oil, signs of an oil crisis, I hope this is wrong...

$160 Oil ... Sooner Than You Think
Posted by commoditywatch on March 26th, 2008


(right click + save as)

[briarberry] 27/3/2008 20:21

NEW YORK (Dow Jones)--The first auction of the New York Federal Reserve's
Treasury securities under the central bank's expanded Term Securities Lending
Facility saw good demand Thursday.

The New York Fed said the bid-to-cover ratio, a gauge of demand, stood at
1.15. Total bids submitted were $86.1 billion and $75 billion were accepted.
The stop-out rate was 0.33%

[briarberry] 27/3/2008 18:08

quote from bond trader...



LEH cds now wider by 25-50 bps and there is heavy put buying. Where there is smoke...

[briarberry] 27/3/2008 18:04

MIAMI (AP) -- Lennar Corp., one of the nation's largest homebuilders, said Thursday it swung to a loss in the first quarter as it absorbed charges to adjust land values, while new home sales and prices sank amid the stumbling real estate market.

Lennar reported a loss of $88.2 million, or 56 cents per share, in the three months ended Feb. 29 compared with profit of $68.6 million, or 43 cents per share, in the year ago quarter.

Sales fell 62 percent to $1.06 billion from $2.79 billion in the year-ago period. The average selling price fell 8 percent.

Deliveries of new homes were down 60 percent to 3,596 homes. New home orders were down 57 percent to 3,045, with a cancellation rate of 26 percent.

[briarberry] 27/3/2008 16:35

There is little to suggest that the stress on the American banking system is easing. Yesterday it emerged that the banks that had agreed to finance the $19.5 billion (£9.7 billion) buyout of Clear Channel, led by Citigroup and Deutsche, stand to lose about $3 billion on the transaction because loan prices have tumbled since they promised to fund the deal.

[briarberry] 27/3/2008 16:27

inflation in South Africa...


March 26 (Bloomberg) -- South African inflation accelerated to more than 9 percent in February for the first time in almost five years, adding to pressure on the central bank to raise interest rates.

The CPIX inflation rate, which excludes mortgage costs, rose to 9.4 percent from 8.8 percent in January, Pretoria-based Statistics South Africa said today.

[briarberry] 27/3/2008 15:53

Regional Banks - shares showing weakness, worth watching as an indicator, sounds like those construction loans might be increasingly in trouble, not sure how long it's going to take before it's out in public...

[briarberry] 27/3/2008 15:48

US inflation is only 2.4% yoy according to the US Gov. in their GDP figure...

The fourth quarter GDP price index was revised down to 2.4 percent annualized from the previous estimate of 2.7 percent

[briarberry] 26/3/2008 22:28

US Government finances are falling apart. In another mind bending shock today, the Treasury announced yet another surprise CMB auction. This one will raise $26 billion in new cash tomorrow in an action completely unforeseen by the Treasury Borrowing Advisory Committee. That makes $56 billion in new Treasury borrowing this week that the experts did not foresee less than two months ago. Total new supply will be $78 billion, which will drain cash from the market at issuance on Thursday and Monday. If the Fed does not act aggressively to offset this cash drain, the markets could crack.