GM Bondholder Offer Disappoints (WSJ)
"General Motors Corp. said it won't repurchase any of the $27.2 billion of notes sought by the ailing auto maker, saying bondholder interest was far below the 90% threshold the company was seeking.
GM was seeking support for an effort to swap the debt load for a 10% stake in a restructured company that is on the brink of filing for bankruptcy."
Roubini Comments On Recession Ending (NYT)
"We are not yet at the bottom of the U.S. and the global recession," said Roubini. "The contraction is still occurring and the recession is going to be over more towards the end of the year rather than in the middle of the year."
"There is still too much optimism that a recovery is just around the corner," said Roubini, a professor at New York University's Stern School of Business and chairman of RGE Monitor, an independent economic research firm."
US Debt Downgrade Possible? (FT)
With the downgrade of British debt, the FT is looking into whether or not the United States could be next. While a downgrade is highly unlikely, recent events have proven just about anything is possible.
"Standard and Poor's decision to downgrade its outlook for British sovereign debt from "stable" to "negative" should be a wake-up call for the US Congress and administration. Let us hope they wake up.
Under President Barack Obama's budget plan, the federal debt is exploding. To be precise, it is rising - and will continue to rise - much faster than gross domestic product, a measure of America's ability to service it. The federal debt was equivalent to 41 per cent of GDP at the end of 2008; the Congressional Budget Office projects it will increase to 82 per cent of GDP in 10 years. With no change in policy, it could hit 100 per cent of GDP in just another five years."
Clearnet To Expand Its Service On Swaps (WSJ)
"LCH.Clearnet Ltd. is preparing to offer centralized clearing of interest-rate swaps to governments, corporations and investment funds that are clients of large banks, expanding an existing service to a wider group of market participants.
The latest offering, expected to launch in the fourth quarter, comes amid efforts by the Obama administration to overhaul regulatory oversight and trading practices in the over-the-counter derivatives markets. Regulators want to reduce the risk of losses arising from the failure of firms that are counterparties to numerous transactions, and to improve reporting of derivative trades."
Bain Said To Lead KKR In Bid For 20% Of China's Gome (Bloomberg)
"Bain Capital LLC may buy as much as 20 percent of Gome Electrical Appliances Holdings Ltd., China's second-largest electronics retailer, four people familiar with the discussions said.
Bain may pay about $500 million for the stake, two of the people said, asking not to be identified because the talks are confidential. Bain is competing for Beijing-based Gome with KKR & Co. and Warburg Pincus, the people said."