Sunday, August 23, 2009

Financial Crunch! Economic Collapse! (Part 6)

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Société Générale tells clients how to prepare for potential 'global collapse'
Société Générale has advised clients to be ready for a possible "global economic collapse" over the next two years, mapping a strategy of defensive investments to avoid wealth destruction.
By Ambrose Evans-Pritchard
Published: 6:12PM GMT 18 Nov 2009
In a report entitled "Worst-case debt scenario", the bank's asset team said state rescue packages over the last year have merely transferred private liabilities onto sagging sovereign shoulders, creating a fresh set of problems.
Overall debt is still far too high in almost all rich economies as a share of GDP (350pc in the US), whether public or private. It must be reduced by the hard slog of "deleveraging", for years.
"As yet, nobody can say with any certainty whether we have in fact escaped the prospect of a global economic collapse," said the 68-page report, headed by asset chief Daniel Fermon. It is an exploration of the dangers, not a forecast.
Under the French bank's "Bear Case" scenario (the gloomiest of three possible outcomes), the dollar would slide further and global equities would retest the March lows. Property prices would tumble again. Oil would fall back to $50 in 2010.
Governments have already shot their fiscal bolts. Even without fresh spending, public debt would explode within two years to 105pc of GDP in the UK, 125pc in the US and the eurozone, and 270pc in Japan. Worldwide state debt would reach $45 trillion, up two-and-a-half times in a decade.
(UK figures look low because debt started from a low base. Mr Ferman said the UK would converge with Europe at 130pc of GDP by 2015 under the bear case).
The underlying debt burden is greater than it was after the Second World War, when nominal levels looked similar. Ageing populations will make it harder to erode debt through growth. "High public debt looks entirely unsustainable in the long run. We have almost reached a point of no return for government debt," it said.
Inflating debt away might be seen by some governments as a lesser of evils.
If so, gold would go "up, and up, and up" as the only safe haven from fiat paper money. Private debt is also crippling. Even if the US savings rate stabilises at 7pc, and all of it is used to pay down debt, it will still take nine years for households to reduce debt/income ratios to the safe levels of the 1980s.
The bank said the current crisis displays "compelling similarities" with Japan during its Lost Decade (or two), with a big difference: Japan was able to stay afloat by exporting into a robust global economy and by letting the yen fall. It is not possible for half the world to pursue this strategy at the same time.
SocGen advises bears to sell the dollar and to "short" cyclical equities such as technology, auto, and travel to avoid being caught in the "inherent deflationary spiral". Emerging markets would not be spared. Paradoxically, they are more leveraged to the US growth than Wall Street itself. Farm commodities would hold up well, led by sugar.
Mr Fermon said junk bonds would lose 31pc of their value in 2010 alone. However, sovereign bonds would "generate turbo-charged returns" mimicking the secular slide in yields seen in Japan as the slump ground on. At one point Japan's 10-year yield dropped to 0.40pc. The Fed would hold down yields by purchasing more bonds. The European Central Bank would do less, for political reasons.
SocGen's case for buying sovereign bonds is controversial. A number of funds doubt whether the Japan scenario will be repeated, not least because Tokyo itself may be on the cusp of a debt compound crisis.
Mr Fermon said his report had electrified clients on both sides of the Atlantic. "Everybody wants to know what the impact will be. A lot of hedge funds and bankers are worried," he said.
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Goldman Sachs Apologizes, Gives Back

Under Fire for Big Pay, Goldman Announces $500M Small Business Program, CEO Apologizes While Accepting 'CEO of the Year' Award
By Zunaira Zaki and Alice Gomstyn
ABC NEWS Business Unit
Nov. 18, 2009
US: Goldman Sachs, which is preparing another multi-billion dollar bonus for execs and key employees, attempts to divert criticism by allocating a so-called 'altruistic' $500 million program for small businesses. This is less than 3% of its employee compensation pool. Few people are impressed.
The Wall Street firm that has arguably taken the most heat for its multibillion-dollar employee compensation will donate $500 million for a new program to help small businesses.
A trader of Goldman Sachs works on the floor of the New York Stock Exchange in this file photo. Goldman Sachs Group Inc. is teaming with billionaire investor Warren Buffett to invest $500 million to provide thousands of small business owners across America with college scholarships and boost their access to capital. (Chip East/Reuters)
Goldman Sachs, widely viewed as the biggest bank to suffer the least damage from the world's financial crisis, said Tuesday it will join forces with billionaire investor and Goldman stakeholder Warren Buffett on "10,000 Small Businesses."
The program will provide capital to small businesses in underserved areas and education aid to small business owners.
"Small businesses play a vital role in creating jobs and growth in America's economy," Goldman CEO Lloyd C. Blankfein said in a statement released Tuesday. "We are pleased to work with our partners in this initiative to support small business owners, particularly those in underserved communities."
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Stock Market Rally: Shenanigans Abounding
Courtesy of Jesse’s Café Américain
September 16, 2009 Posted by ilene9
This is just an opinion, and it could be wrong, as all opinions may be.
To be long US equities at this point seems risky, bordering on reckless, for anything but a daytrade. And there is plenty of that going on.
The US markets in general have every mark of a maturing Ponzi scheme in the steady run ups on weakness, and the ramps into the close with the selling after hours on weak volumes.
But why?
Thursday is option expiration, a quadruple witch as we recall. September is one of the big ones, often setting up declines in the month of October. Further, we have Rosh Hoshanah beginning at sundown on Friday September 18. As the saying goes, Sell Rosh HaShana and Buy Yom Kippur.
The government is anxious to encourage ‘confidence’ to the extent of skewing the statistics to create hope in the public, the consumers. The banks are flush with liquidity, but really have no place to put it but for a minimal return at Treasury, or in some hot money trades.
Where is Goldman Sachs business revenue and profit coming from now? How much real investment banking is being done? How much M&A activity and IPOs are there to sustain it at this size, unscathed by the recent market downturns?
Obama and his team have NO credibility for reform on Wall Street after their handling of Goldman Sachs and the AIG payouts. We hear that Goldman had shopped the idea of those derivatives to them, became their biggest customer, and then managed the 100 cents on the dollar payouts from the government even as AIG became hopelessly insolvent.
Bonds, stocks, metals, sugar, cocoa, and oil are all moving higher, while the dollar sinks. Is the dollar funding a new carry trade?
The markets are increasingly the flavor of choice, and if the markets do not show a way, they will make one. Volatility is a screaming buy. Put vertical spreads are remarkably cheap.
Be careful. October looks to be the stormiest of months, if we hold out until then. The market is overdue for a correction, which can be up to 20%. Given the distance we have come on thin volume, what may make this correction shocking is the speed with which it will come.
Watch the VIX.
We remain guardedly ‘optimistic’ on the markets for next year ONLY because of the Fed’s and Treasury’s willingness to continue to debase the dollar to cover the massive unrealized losses in the banks’ portfolios, even as they return to manipulating markets in business as usual.
Inflation is good for financial assets, and we think another bubble is in the cards, at least for now given Obama’s unwillingness to reform, unless some exogenous event or actor intervenes.
Until the banks are restrained, and the financial system is reformed, and balance is restored to the economy, there will be no sustained recovery.
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Insiders sell like there's no tomorrow
Corporate officers and directors were buying stock when the market hit bottom. What does it say that they're selling now?
By Colin Barr, senior writer
September 12, 2009
NEW YORK (Fortune) -- Can hundreds of stock-selling insiders be wrong?
The stock market has mounted an historic rally since it hit a low in March. The S&P 500 is up 55%, as U.S. job losses have slowed and credit markets have stabilized.
But against that improving backdrop, one indicator has turned distinctly bearish: Corporate officers and directors have been selling shares at a pace last seen just before the onset of the subprime malaise two years ago.
While a wave of insider selling doesn't necessarily foretell a stock market downturn, it suggests that those with the first read on business trends don't believe current stock prices are justified by economic fundamentals.
"It's not a very complicated story," said Charles Biderman, who runs market research firm Trim Tabs. "Insiders know better than you and me. If prices are too high, they sell."
Biderman, who says there were $31 worth of insider stock sales in August for every $1 of insider buys, isn't the only one who has taken note. Ben Silverman, director of research at the InsiderScore.com web site that tracks trading action, said insiders are selling at their most aggressive clip since the summer of 2007.
Silverman said the "orgy of selling" is noteworthy because corporate insiders were aggressive buyers of the market's spring dip. The S&P 500 dropped as low as 666 in early March before the recent rally took it back above 1,000.
"That was a great call," Silverman said. "They were buying when prices were low, so it makes sense to look at what they're doing now that prices are higher."
Straightforward trading In the case of firms such as discount broker TD Ameritrade (AMTD), they are selling with abandon. Chairman Joe Moglia has netted more than $10 million in profits from stock sales since April, by selling shares on each of the last 106 business days, according to Securities and Exchange Commission filings.
0:00 /4:07 The stock market's lost decade A TD Ameritrade spokeswoman said Moglia's sales are being made under a pre-arranged selling plan he filed with the SEC last August. Under that plan, his brokers exercise some options he got eight years ago and sell the underlying shares every day the company's stock price is above a certain level.
Moglia's not the only insider selling at TD Ameritrade. The company's founder and former chairman, Joe Ricketts, and his wife Marlene last month sold 5.7 million shares to help fund the family's purchase of the Chicago Cubs baseball team. They owned 16% of the company's stock at last count.
Silverman said the TD Ameritrade insider sales don't particularly raise concerns about the company's health, because "special circumstances" -- the Cubs deal and the pending expiration of Moglia's options -- are evident.
He said it's potentially more worrisome when insiders suddenly make big sales without obvious motivating factors.
Fossil (FOSL) CEO Tom Kartsotis has sold $25 million of the watchmaker's stock over the past month. Shares of Fossil have more than doubled since early March. Fossil didn't immediately return a call seeking comment.
At video game maker Activision Blizzard (ATVI), CEO Robert Kotick and director Brian Kelly each made more than $10 million last month by selling shares after exercising stock options.
While some of Kotick's options were due to expire next year, others weren't due to expire until 2014 in his case and 2012 in Kelly's. The stock sales took place at prices that were about 50% above their 52-week low. Activision didn't respond to a request for comment.
Adding to the flurry of stock sales, companies are selling stock to the public at a brisk clip while buybacks have tailed off. All told, U.S. corporations have been net sellers of $105 billion of stock over the past four months, Biderman said.
Insiders have managed to cash in on some of those offerings. Healthcare payment administrator Emdeon (EM), for instance, last month raised $155 million in an initial public offering. At the same time, selling shareholders led by private equity investor General Atlantic Partners raised $188 million.
Though the wave of selling by insiders doesn't necessarily predict a pullback in their stocks or the market as a whole, it's hard to put a happy spin on the recent trends.
"The disparity between buyers and sellers right now is vast," said Silverman. "That's the beauty of following insider trading -- these guys are talking with their checkbooks."
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China’s Stock Markets Plunge Over Six Percent
Epoch Times Staff Aug 31, 2009
STOCK DROP: Stock markets in Shanghai and Shenzhen in mainland China experienced huge drops again on the last business day of August, with Shanghai stock market falling over six percent and Shenzhen over seven percent. These drops are the highest recorded since June 10, 2008. (Getty Images) On the last trading day of August, stock markets in Shanghai and Shenzhen experienced another huge drop, with the Shanghai market falling over six percent and Shenzhen over seven percent. These percentage drops are the highest recorded since June 10, 2008. The stock markets around the globe immediately started to experience the pain, with major stock indexes in Europe and America all falling.
The Shanghai index closed at 2667.74, the lowest point during the day. Compared with the day before, the index fell 192.92 points, which translates to 6.74 percent. It is the biggest one-day drop in the past 15 months. Shenzhen index closed at 10585.08 points. That was a drop of 864.99 points, 7.55 percent.
Market analysts believe the reason for the plunge is that investors were worried about the issuance of new stock shares by Metallurgical Corporation of China Ltd, scheduled to take place soon, according to Voice of America. In addition, many other corporations plan to issue new shares in the following months. Investors fear these new shares may adversely affect China’s stock market.
Another possible reason comes from the hearsay that banks plan to tighten lending standards. Many analysts feel the previous bull market in China is the result of enhanced market liquidity, which in turn, was a result of economic stimulus policies. Thus, the bull market is not a true representation of China’s economic status quo. These analysts believe that as stimulus spending comes to an end, banks will tighten lending, and the stock market bubble will burst.
The plunge of China’s stock market sent waves to global markets. On Monday, all European markets started to fall. Frankfurt DAX stock index fell 1.1 percent to 5,458.04 points, France CAC-40 fell 1.07 percent to 3653.34 points. London’s stock market was not open due to a public holiday.
The major stock indexes in the U.S. dropped at opening, and went up a little at closing. At closing, Standand & Poor’s index dropped 0.81 percent to 1,020.62; Dow Jones Industrial Average dropped 0.50 percent to 9,496.28; NASDAQ composite index dropped 0.97 percent to 2,009.06
Affected by Shanghai stock market, Hong Kong Hang Seng index dropped 1.8 percent. It has been hovering at a low point for a month now.
Australia stock market fared better with a drop of merely two percent. The stock of Australia & New Zealand Banking, the fourth bank in Australia, jumped 4.1 percent.
Market analysts think the worries investors have for China’s economic recovery will continue to grow, and that consumers will still feel uncertain about the global economic recovery. This is a manifestation of how China’s economy has come to play an increasingly important role in the global economy, as the world’s third largest.
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Prediction: More than 300 bank failures in America
Financial analyst Meredith Whitney
by Lynn Thomasson and Margaret Brennan
Global Research, August 27, 2009
Meredith Whitney, the analyst who predicted that Citigroup Inc. would cut its dividend last year, said the number of U.S. bank failures will quadruple as lenders struggle with bad loans.
“There will be over 300 bank closures,” Ms. Whitney said in an interview with Bloomberg Television from Jackson Hole, Wyo. “The small-business owner on Main Street continues to see liquidity come away.”
Unemployment has risen to the highest since the early 1980s and Americans are falling behind on mortgage payments at a record pace, forcing regulators to seize 77 lenders in 2009, the most in 17 years. Colonial BancGroup Inc. was closed by the Federal Deposit Insurance Corp. and taken over by BB&T Corp. on Aug. 14 in the biggest failure since Washington Mutual Inc. collapsed in 2008.
The FDIC plans to ease rules to allow private-equity investors to acquire insolvent banks, the New York Times reported Friday, citing unidentified people briefed on the situation. The move would help reduce the number of failed banks the FDIC needs to support as their number increases, the newspaper said.
Ms. Whitney said that even though the panic of the financial crisis has passed, investors have been “overzealous” in estimating bank profits for the next few years. Analysts polled by Bloomberg project earnings for the industry will surge more than ninefold this year and 57% in 2010 as lenders recover from the worst crisis since the Great Depression.
“Many banks may be OK for a while, but the real driver for the economy, which is consumer spending, I don’t expect that to come back anytime soon,” she said.
Financial companies in the Standard & Poor’s 500 Index have collectively rallied 135% in the past five months after falling to the lowest level since 1992.
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World's Stocks Controlled by Select Few
by Lauren Schenkman
Global Research, August 27, 2009
WASHINGTON -- A recent analysis of the 2007 financial markets of 48 countries has revealed that the world's finances are in the hands of just a few mutual funds, banks, and corporations. This is the first clear picture of the global concentration of financial power, and point out the worldwide financial system's vulnerability as it stood on the brink of the current economic crisis.
A pair of physicists at the Swiss Federal Institute of Technology in Zurich did a physics-based analysis of the world economy as it looked in early 2007. Stefano Battiston and James Glattfelder extracted the information from the tangled yarn that links 24,877 stocks and 106,141 shareholding entities in 48 countries, revealing what they called the "backbone" of each country's financial market. These backbones represented the owners of 80 percent of a country's market capital, yet consisted of remarkably few shareholders.
"You start off with these huge national networks that are really big, quite dense," Glattfelder said. “From that you're able to ... unveil the important structure in this original big network. You then realize most of the network isn't at all important."
The most pared-down backbones exist in Anglo-Saxon countries, including the U.S., Australia, and the U.K. Paradoxically; these same countries are considered by economists to have the most widely-held stocks in the world, with ownership of companies tending to be spread out among many investors. But while each American company may link to many owners, Glattfelder and Battiston's analysis found that the owners varied little from stock to stock, meaning that comparatively few hands are holding the reins of the entire market.
“If you would look at this locally, it's always distributed,” Glattfelder said. “If you then look at who is at the end of these links, you find that it's the same guys, [which] is not something you'd expect from the local view.”
Matthew Jackson, an economist from Stanford University in Calif. who studies social and economic networks, said that Glattfelder and Battiston's approach could be used to answer more pointed questions about corporate control and how companies interact.
"It's clear, looking at financial contagion and recent crises, that understanding interrelations between companies and holdings is very important in the future,” he said. "Certainly people have some understanding of how large some of these financial institutions in the world are, there's some feeling of how intertwined they are, but there's a big difference between having an impression and actually having ... more explicit numbers to put behind it."
Based on their analysis, Glattfelder and Battiston identified the ten investment entities who are “big fish” in the most countries. The biggest fish was the Capital Group Companies, with major stakes in 36 of the 48 countries studied. In identifying these major players, the physicists accounted for secondary ownership -- owning stock in companies who then owned stock in another company -- in an attempt to quantify the potential control a given agent might have in a market.
The results raise questions of where and when a company could choose to exert this influence, but Glattfelder and Battiston are reluctant to speculate.
"In this kind of science, complex systems, you're not aiming at making predictions [like] ... where the tennis ball will be at given place in given time," Battiston said. “What you're trying to estimate is ... the potential influence that [an investor] has."
Glattfelder added that the internationalism of these powerful companies makes it difficult to gauge their economic influence. "[With] new company structures which are so big and spanning the globe, it's hard to see what they're up to and what they're doing,” he said. Large, sparse networks dominated by a few major companies could also be more vulnerable, he said. "In network speak, if those nodes fail, that has a big effect on the network."
The results will be published in an upcoming issue of the journal Physical Review E.
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MORE Banking Fraud (Foreclosure Stats)Posted by Karl Denninger
Thursday, August 20. 2009
http://market-ticker.denninger.net/archives/1355-MORE-Banking-Fraud-Foreclosure-Stats.html
When does the willful blindness in terms of bank fraud taking place daily in the so-called "marks" on housing-related loans stop?
The Mortgage Bankers Association released its latest update:
The non-seasonally adjusted delinquency rate increased 64 basis points from 8.22 percent in the first quarter of 2009 to 8.86 percent this quarter.
and
The delinquency rate includes loans that are at least one payment past due but does not include loans somewhere in the process of foreclosure. The percentage of loans in the foreclosure process at the end of the second quarter was 4.30 percent, an increase of 45 basis points from the first quarter of 2009 and 155 basis points from one year ago. The combined percentage of loans in foreclosure and at least one payment past due was 13.16 percent on a non-seasonally adjusted basis, the highest ever recorded in the MBA delinquency survey.
That's right folks. That means that of all mortgage loans 13.16% are not in "accrual" status - that is, they're not performing in that interest and principal are not being paid. This is no longer about "subprime" - it is now all about prime loans; the claim that this was going to be "contained' is now proved false.
That our banks are not being forced to take the marks associated with these delinquencies is an outrage. It is the cause of the FDIC's losses, it is the cause of our credit system remaining locked up, and it is the cause of our continued moribund economy, as without a functioning credit system there can be no actual economic recovery.
These institutions are being protected by our Congress and the willful, intentional blindness of The Federal Reserve, FDIC, OTS and OCC.
These agencies and persons have the same data that is being released to the market. The stock market continues to rally not based on improving economics but based on the federal government and The Federal Reserve continuing to allow institutions to LIE about their financial condition and the expectation that the LIES will be permitted to continue!This is exactly akin to me going to buy a new car, telling the dealer that I have no money, no job, no assets and no hope of gaining any of the above, but the dealer writes me a loan anyway and lets me drive off so he can claim he made a sale, with full knowledge that there is no chance in Hell I can afford to pay for what just "purchased." He does so because he believes he can (and has been allowed to!) lie about my financial condition for more than two years by the government thus far, and he thus expects he will be able to so do going forward indefinitely.
But any so-called "economic recovery" based on such a thing is in fact false, as I can't pay and thus won't. The cash flow that my payments should generate will not materialize and both the car dealer and government know it.
The system is bankrupt and we MUST clear it of these non-performing loans. We have spent two years playing "extend and pretend", believing that somehow the economy will imminently turn and thus all these "bad assets" will suddenly become good, even though statistically once you miss two payments the odds of you "curing" that delinquency - due to the fact that you would have to come up with BOTH overdue payments plus the current one - are near zero.
This is an intentional act of fraud up and down the line and it MUST STOP or we will face an economic catastrophe far worse than anything that was believed to be at our doorstep last fall as the production that has occurred but cannot be paid for WILL cause a massive economic dislocation in the near future.
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China’s Tumbling Stock Market Draws Mixed Response
Epoch Times Staff
Aug 19, 2009
http://www.theepochtimes.com/n2/content/view/21224/
China’s stock market hit a nine-month low on August 18, drawing a mixture of expert commentary.
Voice of America (VOA) reported that both the Shanghai Composite Index and the Shenzhen Component Index have tumbled, with the former falling below 2,900 points after hitting 3,000 points not long ago, believed to mark the point when investors will lose confidence in the market and begin selling their stocks.
An analyst from Huatai Securities, as reported by Reuters, believes such volatility in the Chinese stock market will continue, since the market recovery and the regime’s policy on the securities market are still unclear at this point.
China’s FDI was down 35.7 per cent compared to July of last year, according to Ministry of Commerce spokesman Yao Jianon on Monday, August 17. The country has also experienced a significant decline in foreign direct investment (FDI) in July, according to the Chinese Ministry of Commerce.Zhang Xiaoji, Director of the Research Department of the Foreign Economic Relations of the Development Research Center under the State Council, stated that short term analysis of foreign investment is meaningless.
“The launch of one or two major projects will impact the market data,” Zhang was quoted as saying in the state-run Xinhua News Agency. However, he also admitted that, as the global economy is yet to recover, China is bound to be adversely affected.
Zhang Weijing, professor of Guanghua School of Management at Peking University has argued that by 2040 China will account for one quarter of the world’s economy.
Others believe this conjecture is overly optimistic, asserting that both the Chinese and international economies are facing serious challenges.
Gordon Chang, an American scholar and analyst on China’s social development, explained during an interview with VOA that after the cold war, the global economic trend was toward an increase in trade between countries. Currently, the trend is the opposite, and China needs to restructure the economic framework—not an easy task under the current circumstances.
He suggested that both China and the international community face this reality and remove the apparently adulterated portion of Chinese official data during analysis and judgment.
Chang indicated that there are two problems with official statistics. “The first and also the most important is the high volatility of the Chinese economy, and that statistical methods have not been able to keep up. In these circumstances, methodologies of data collection are far from complete.”
The second issue, he said, is that “the Chinese government doesn’t tell the truth.”
Chang commented that China’s official data for the end of last year and beginning of this year is a “complete mess.” While admitting decline in import, export, government fiscal revenues, foreign investment, electric production, and so on, officials still claim an increase in gross domestic product (GDP).
Beijing’s official economist Li Yining said the Chinese economy is facing three hurdles in an interview with Xinhua. First, China’s exports are falling because of the international economic impact. Second, the growth of domestic consumption is not as fast as originally envisioned. Third, economic restructuring is a relatively slow process.
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JP Morgan Bails Out CaliforniaJohn CarneyAug. 19, 2009
http://www.businessinsider.com/jp-morgan-bails-out-california-2009-8
Remember when the US government had to bail out investment banks? Now a bank is bailing out the state of California.
California had been covering its budget shortfalls by issuing IOUs to pay for services, making it the first state to issue its own fiat currency since the Civil War. The program ran into trouble when banks announced they wouldn't keep cashing the IOUs.
Eventually California reached a budget deal and kicked the can down the road, but there's still the issue of the outstanding IOUs.
Yesterday JP Morgan agreed to lend California $1.5 billion to fund the program to redeem the IOUs. State controller John Chiang has announced the redemptions will begin on September 4th.
A plausible case can be made that this is an indirect bailout by the US government of California. JP Morgan is deemed to big to fail, and can borrow from both the Fed and at reduced costs in the market because of its status. This makes it far easier for the bank to lend confidently to California. What's more, JP Morgan can assume that if California were to come close to defaulting on the loan, the US government would bail out California.
From the LA Times:
Just what JPMorgan will earn on the loan hasn't been determined, Dresslar said. The terms are still being worked out, he said. Lockyer will have to be able to make the case that the private placement of the debt with JPMorgan is as good as or better than any deal the state could get with other banks.The risk to JPMorgan is virtually nil: The loan will be repaid by late September, when the state plans to sell $10.5 billion of so-called revenue anticipation notes, or RANs -- securities that will mature next spring. Individual investors are expected to flock to the RAN offering as a place to stash cash, because the notes should offer much more lucrative returns than money market funds and other short-term accounts paying next to nothing.
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