Archive for the 'Interesting Stuff' Category

* MBIA, Ambac May Each Have $11.6 Billion in Losses, Ackman Says

Wednesday, January 30th, 2008

By Christine Richard and Mark Pittman
Jan. 30 (Bloomberg) — MBIA Inc. and Ambac Financial Group
Inc., the two largest bond insurers, may each lose $11.6 billion
on guarantees of residential mortgage securities and some
collateralized debt obligations, according to hedge fund manager
William Ackman.
Ackman calculated the losses using a model supplied by an
unnamed investment bank and sent the findings in a letter to the
Securities and Exchange Commission and New York Insurance
Superintendent Eric Dinallo. Ackman is a managing partner of
Pershing Square Capital Management LP, which is trying to profit
from declines in the stocks and bonds of MBIA and Ambac.
Ackman, 41, stepped up his attack by posting on the Internet
a list of asset-backed CDOs and other securities guaranteed by
Armonk, New York-based MBIA and New York-based Ambac that allows
others to craft their own loss predictions. Ackman didn’t say how
he got details on the securities, many of which haven’t been
disclosed by the companies.
“Up until this point in time, the market and the regulators
have had to rely on the bond insurers and the rating agencies to
calculate their own losses in what we deem a self-graded exam,”
Ackman said in a statement preceding release of the letter. “Now
the market will have the opportunity to do its own analysis.”
MBIA fell $2.56, or 16 percent, to $13.42 at 3:21 p.m. in
New York Stock Exchange composite trading. Ambac dropped $1.77,
or 14 percent, to $11.16. Both companies have lost more than
80 percent of their market value in the past year.

Silly? What do you mean….

Tuesday, January 22nd, 2008

It’s been an interesting day. European equities markets started the day in ultra-bearish territory, kicking off with a 4.5% drop in the Stoxx 600 Index, a benchmark of the six hundred biggest companies in Europe. After a good hour of trading a sticky rumour hit the markets that we would see a coordinated rate cut by the Fed, ECB and Bank of England. This immediately reversed sentiment, making the Stoxx 600 move back to Monday’s closing levelĀ  in a matter of an hour.

After lunch it was the Fed who actually delivered with a 75bp rate cut, which set the stage for another leg up, leaving the Stoxx with a 2.2% gain for the day.

So let’s get this straight. The market capitalization of the average multi-billion European company changed with about 7%in the course of 8 hours. And then there are still people who honestly believe that market participants rationally reflect all information in prices and sentiment only plays a modest role in markets. What a day!

* World’s Oil Production, Consumption & Flow

Saturday, December 29th, 2007

Oil Players The Financial Times has put up a couple nice pictures which give you a very clear view of how the world’s oil production, consumption and flow is currently working. Check it out by following this link.

* French companies close $7.8b in contracts in Algeria

Wednesday, December 5th, 2007

Dec. 4 (Bloomberg) — Alstom SA, Gaz de France SA, Total SA
and Bull SA signed contracts worth more than 5 billion euros
($7.8 billion) in Algeria as part of French President Nicolas
Sarkozy’s three-day visit to the North African country.
The contracts are to build power and petrochemical plants,
buy natural gas and renovate the former French colony’s post
offices. They reflect Sarkozy’s efforts to strengthen ties with
Algeria as part of his broader plan to forge greater pan-
Mediterranean economic cooperation.

Weekend Read-Up

Sunday, December 2nd, 2007
  • Newsletter writer sentiment points toward excessive pessimism. (NYTimes.com)
  • Who are the biggest beneficiaries of the proposed subprime mortgage borrower bailout? (Accrued Interest)
  • Contrarian alert! The weak U.S. dollar is now magazine cover fodder. (Alea)
  • Distressed investors are beginning to see attractive opportunities. (WSJ.com)
  • Are the emerging markets now a safe haven? (WSJ.com)

As of Next Week: Twitter Updates

Sunday, November 25th, 2007

TwitterOur frequent visitors know that we tend to post “market moving” news facts as quickly as possible on this blog. We now have found a way to make those breaking news updates even more convenient for our readers: we’re going to make them available via twitter.com.

The functionality that Twitter offers is simply fantastic. Dealingfloor will post its breaking news items to Twitter (max 140 characters in length). People who “follow” us on Twitter will then be able to receive those updates in a format that suits them (by RSS, Instant Message or SMS).

A practical example. One of our readers, let him be called SuperTrader, joins twitter.com and decides to follow www.twitter.com/dealingfloor. SuperTrader enrolls his mobile phone on the twitter website and also provides the details of his Instant Messaging client (GTALK, AIM, .Mac, LiveJournal, Jabber). Finally he puts on “notifications” for dealingfloor.

Now this is what happens. Dealingfloor sends the following update to twitter: * FED LOWERS RATE BY SURPRISE 25BP. Instantaneously this update will be shown on the website twitter.com/dealingfloor. These updates can therefore be seen on the website or via RSS (don’t forget to subscribe). Sofar nothing new you might say.

Now the beautiful part of it. If SuperTrader has put notifications on for dealingfloor and he’s currently has his Instant Message client open (on his desktop or mobile phone), he’ll receive this message in his instant messenger. If he logs off from his instant messenger, then he will automatically received the message * FED LOWERS RATE BY SURPRISE 25BP by SMS on his mobile phone.

So there we go. An exiting new way to stay up to date with breaking market news, whether you’re behind or away from your screen!

Oh and no worries. We promise to only update market moving events. And Twitter provides an option to turn off phone notifications during certain periods (such as the night).

Dealingfloor is confident that these “tweeds” will be of added value to our readers. For a short period of time we will continue to post the breaking news on our blog, but we’re looking to eventually move all the time sensitive information to Twitter. We hope you like this new service and look forward to see you following us at twitter.com/dealingfloor.

How Financial Markets Really Work

Sunday, November 25th, 2007

With all the talk going on about the mortgage crisis in financial markets, it makes sense to look at the developments with some humor. Below you’ll find a hilarious video discussing the financial community in general and the sub prime crisis in specific (idea from The New Inspirer). Enjoy!

** WEEKEND READ-UP **

Sunday, March 5th, 2006
- The World’s Cumulative Gold and Silver Production
- Ominous Warnings & Dire Predictions
 
- Energy - Author Ken Deffeyes thinks the depletion of fossil fuels could lead to a worldwide cataclysm
 
- Venezuela Prepared to Stop U.S. Exports
 
- Norwegian Bourse Director wants oil bourse - priced in euros
 
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** WEEKEND READ-UP **

Sunday, February 26th, 2006
- Retail Investors Late to the Party?
 
- The End of Dollar Hegemony - Honourable Ron Paul of Texas
 
- Cancelled home orders: Latest bubble prick?
 
- Shadowing Reality - Economist Keeps Tabs On Government’s “Creative” Statistical Reports
 
- Rolling the Dice on Bird Flu - Some stocks
 
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** WEEKEND READ-UP **

Sunday, February 19th, 2006

- Commodities are the new hedge funds according to Credit Suisse

- So no more risks to oil running out of supply? Have another look at this list

- Stockmarket acts oddly before crash according to World Science.

- Cost of Ethanol fuel is higher than gasoline

- The greatest US stocks of the past decade

- Implats expects global platinum shortages

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