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Tuesday, November 10, 2009


Asian stocks advance in wake of Wall Street gains
Asian-Pacific stocks gained Tuesday after a good performance Monday from U.S. indexes. Japan's Nikkei 225 added 0.6%, Australia's S&P/ASX 200 increased 1.3% and South Korea's Kospi Composite advanced 0.4%. Hong Kong's Hang Seng Index improved 0.3%, Taiwan's Taiex rose 0.8%, and China's Shanghai Composite and New Zealand's NZX 50 inched up 0.1%. The Wall Street Journal (10 Nov.)

$400 million TALF-backed deal could revive CMBS market
A $400 million securitized-debt deal for Developers Diversified Realty could breathe life into the frozen commercial mortgage-backed securities market, experts said. It will be the first CMBS deal offered through the Federal Reserve's Term Asset-Backed Securities Loan Facility. "While it's only a toe in the water, banks are actually taking the execution risk of a securitized exit," said Christopher Hoeffel, a managing director at Investcorp International. Goldman Sachs is the lead underwriter. Reuters (11/9)

Credit card securities dry up on accounting-rule changes
Revised accounting rules have hit the market for bonds backed by consumers' credit card debt. The rules put bondholders' rights into question when the financial institution that issues the securities goes into receivership. The accounting changes give regulators the right to claim the assets. The Federal Deposit Insurance Corp. is set to discuss the situation this week. EasyBourse/Dow Jones Newswires (11/9)

Moody's: Banks could struggle to finance short-term debt
A report released by Moody's says that banks might struggle in the coming three years to finance $7 trillion in short-term debt. Weaker banks are likely to face serious difficulties in meeting these obligations, the report said, as interest rates rise. A bank that seeks to refinance a short-term government-guaranteed bond should expect to see a marked rise in interest rates on the security. Financial Times (tiered subscription model) (11/9)

*should we really care what economists really say or think?
Survey: Economists see stronger U.S. growth in 2010
Economists polled by Blue Chip Economic Indicators forecast higher GDP growth next year in the U.S. The economists said growth should hit 2.7%, up from an October prediction of 2.5%. "The major uncertainty surrounding the outlook for growth next year involves the degree to which private demand accelerates as the positive contributions to GDP from reduced business inventory liquidation and fiscal stimulus play out," according to the survey. Reuters (10 Nov.)

AIG might be able to repay loans to U.S., Moody's says
Moody's Investors Service said American International Group might be able to repay money it borrowed from the U.S. government. Moody's cited the fact that the government is working closely with AIG in the restructuring process. "The slower approach to restructuring could help AIG to generate more favorable values from its business portfolio than would be the case under rushed asset sales," Moody's said. Bloomberg (10 Nov.)

Oil running out faster than IEA data show, official says
An official of the International Energy Agency said the world is much closer to running out of oil than the agency's statistics had shown. Under pressure from the U.S., the IEA distorted statistics to show that more oil would be available, the official said. "The IEA in 2005 was predicting oil supplies could rise as high as 120 million barrels a day by 2030, although it was forced to reduce this gradually to 116 million and then 105 million last year," the official said. "The 120 million figure always was nonsense, but even today's number is much higher than can be justified, and the IEA knows this." The Guardian (London) (09 Nov.)

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