Tumult In Global Market Continues (NYT)
Jean-Claude Trichet urged Spain and Italy to quickly shore up their credibility with the markets, and called on European leaders to move quickly to implement measures agreed on July 21 to bolster the euro-zone’s bailout fund. “Taken together, and particularly since Lehman Brothers, this is the most grave crisis we have faced since World War II,” he said in an interview with Europe 1 radio in Paris, citing the “financial turbulence” that started in August 2007. “And I believe that it would be the worst since World War I if the authorities had not taken the important decisions they have.”
Disaster Movie Gets A Sequel, With Subtitles (NYT)
“While the players in Washington certainly haven’t performed at AAA level, I would certainly take U.S. Treasuries over other AAA sovereigns any day,” Hank Paulson said.
Why This Crisis Differs From The 2008 Version (WSJ)
The reality is that, unlike 2008, governments' money is no good in today's stressed environment.
Europe's Leaders Play Tennis While Markets Implode (CNBC)
British Prime Minister David Cameron had to return from his vacation on Monday night as parts of London erupted in rioting (a report on Sunday saying that Cameron had flown out a tennis instructor from the UK for the second week of his family holiday in a plush Tuscan estate, was not well-received). His Finance Minister George Osborne has been snapped on a rollercoaster in California. German Chancellor Angela Merkel is off on her usual summer break of a two-week hiking holiday in the Tirol Alps ...French President Nicolas Sarkozy headed off to the French Riviera with his pregnant wife Carla Bruni. José Manuel Barroso is taking some sun in his native Portugal, although his spokeswoman insists that he is working from his vacation. In contrast, Spanish Prime Minister José Luis Rodríguez Zapatero canceled a planned trip to a nature reserve in southern Spain as yields on the country's debt shot up. His Italian equivalent Silvio Berlusconi has abandoned his usual trip to his Sardinian holiday villa, allegedly the scene of "bunga bunga" parties.
$2,500 Bullion? (NYP)
JPMorgan analyst Colin Fenton came out with a strong buy on the relic yesterday, saying bullion could hit $2,500 an ounce by Dec. 31 -- a whopping 45 percent above yesterday's close.
Manager: Market A Spoiled Baby Crying To "Daddy Bernanke" (CNBC)
Following huge losses for the Dow on Monday and further selling in Asia overnight, the markets are watching what the Fed and Ben Bernanke will do at their July Meeting today. Speculation is mounting that the Fed will attempt to restore calm but one fund manager thinks that policy action is unnecessary. “The markets have become like a spoiled baby who expects daddy Bernanke to rush for help whenever they feel a little bit of pain” Pedro Noronha, a fund manager at Noster Capital in London, told CNBC...“This correction was long overdue and it is healthy, as it allows assets to pass from weak into stronger hands and to be more fairly priced” said Noronha.
For Some Asian Hedge Funds, Market Rout Is Sweet (Reuters)
Asian hedge funds Vulpes, started by industry veteran Stephen Diggle, and Tantallon Capital are emerging as winners in a volatile August that has wiped out more than $3.8 trillion from global stock markets. Diggle, who made a fortune during the financial crisis, said his long Asian volatility and arbitrage hedge fund LAVA gained about 4 percent in the first six trading days of the month. Tantallon gained 4.15 percent in its flagship fund last week, according to a letter to investors.
Marc Faber: Markets Oversold, Set for Short-Term Rebound (CNBC)
"I think that near-term stock markets around the world are very, very oversold and most oversold since February, March 2009 and 1987," Faber said. "(It) doesn't mean that they can't go lower, but I think they will rebound." Faber, however, changed his bearish view. He still expects the S&P 500 to drop to 1100 by October, but he says the selloff came even earlier than he had expected. "The strategists in the US, mostly brainless people, who are predicting S&P between 1400 and 1500 by year end, I think they will have to re-adjust their views and I think the markets may actually go lower.
London Police Running Out Of Space As City Licks Wounds (CNBC)
The number of people people in custody numbered 450 Tuesday, after riots spread from Tottenham in North London to engulf Croydon, Brixton and Lavender Hill in the south and Hackney in the east. In London 44 police officers were injured, several seriously, as rioters and looters lashed out with bottles, bricks, firebombs and vehicles. Fourteen members of the public were also hurt, the Metropolitan Police Service (MPS) said, as violence hit "disturbing" levels. One man was shot in Croydon.
Blackberry Messages Probed Amid London Riot (Bloomberg)
Research In Motion said it is assisting London police investigating claims the company’s messaging service was being used by rioters to plan disturbances. After a third night of violence and looting, police will also review the role of messages sent using other popular networking systems, including Twitter. “It is clear that technology is being used, including in demonstrations, to direct people and undermine the police,” deputy assistant commissioner Stephen Kavanagh said yesterday. “It is not for us to moan about this, but to adapt policing style and deal with it.”
G-20 Members Turn Up Intervention Volume (WSJ)
In Brazil, Luiz Pereira, director of international affairs at the Brazilian Central Bank, said after conference calls with other G-20 officials "there's a willingness to think about coordinated measures."
Freddie Mac Seeks $1.5 Billion From Tax Payers (Reuters)
The company reported a comprehensive loss in the second quarter of $1.1 billion. Despite income of $1 billion, the company registered a net worth deficit of $1.5 billion. That is in part because it was required to pay dividends worth $1.6 billion to the Treasury. As a result, the cost to taxpayers of its rescue declined by $100 million this quarter.
Einhorn In Scoring Position For 17% Stake In Mets (NYP)
The new deal will buy Einhorn a 17 percent stake in the team, sources said. He will also become a limited partner, one source said. If he is repaid in full, he will retain that 17 percent stake -- in exchange for the cost of using the money for five years. While the newly structured deal gives Wilpon and Katz more breathing room to repay Einhorn and a greater chance of attracting more cash by selling another minority stake in the team down the road, it also includes a sweetener for Einhorn, sources said. The hedge-fund executive still retains the right to buy, for a token amount, a majority stake in the team if Wilpon and Katz fail to repay the investment.