December 8, 2011
JLN Interest Rates - http://www.jlninterestrates.com
Conversation Starter
Federal Reserve Announces Chairs, Deputy Chairs Of Fed Banks For 2012
Press Release
The Federal Reserve Board on Monday announced the designation of the chairs and deputy chairs of the 12 Federal Reserve Banks for 2012.
Each Reserve Bank has a nine-member board of directors. The Board of Governors in Washington appoints three of these directors and each year designates one of its appointees as chair and a second as deputy chair.
Following are the names of the chairs and deputy chairs designated by the Board for 2012:
Boston
Kirk A. Sykes, President, Urban Strategy America Fund, L.P., Boston, Mass., named Chair.
William D. Nordhaus, Sterling Professor of Economics, Yale University, New Haven, Conn., named Deputy Chair.
New York
Lee C. Bollinger, President, Columbia University, New York, N.Y, renamed Chair.
Kathryn S. Wylde, President and Chief Executive Officer, Partnership for New York City, New York, N.Y., renamed Deputy Chair.
Philadelphia
Jeremy Nowak, President, William Penn Foundation, Philadelphia, Penn., named Chair.
James E. Nevels, Chairman, The Swarthmore Group, Philadelphia, Penn., named Deputy Chair.
Cleveland
Alfred M. Rankin, Jr., Chairman, President and Chief Executive Officer, NACCO Industries, Inc., Cleveland, Ohio, renamed Chair.
Richard K. Smucker, Chief Executive Officer, The J.M. Smucker Company, Orrville, Ohio, renamed Deputy Chair.
Richmond
Margaret E. McDermid, Senior Vice President and Chief Information Officer, Dominion Resources, Inc., Richmond, Va., renamed Chair.
Linda D. Rabbitt, Chairman and Chief Executive Officer, Rand Construction Corporation, Washington, D.C., renamed Deputy Chair.
Atlanta
Carol B. Tomé, Chief Financial Officer and Executive Vice President, The Home Depot, Atlanta, Ga., renamed Chair.
Thomas I. Barkin, Director, McKinsey & Company, Atlanta, Ga., renamed Deputy Chair.
Chicago
William C. Foote, Retired Chairman of the Board, USG Corporation, Chicago, Ill., renamed Chair.
Jeffrey A. Joerres, Chairman and Chief Executive Officer, ManpowerGroup, Milwaukee, Wis., named Deputy Chair.
St. Louis
Ward M. Klein, Chief Executive Officer, Energizer Holdings, Inc., St. Louis, Mo., named Chair.
Sharon D. Fiehler, Executive Vice President & Chief Administrative Officer, Peabody Energy, St. Louis, Mo., named Deputy Chair.
Minneapolis
Mary K. Brainerd, President and Chief Executive Officer, HealthPartners, Minneapolis, Minn., named Chair.
Randall J. Hogan, Chairman and Chief Executive Officer, Pentair, Incorporated, Minneapolis, Minn., named Deputy Chair.
Kansas City
Paul DeBruce, Chief Executive Officer and Founder, DeBruce Grain, Inc., Kansas City, Mo., renamed Chair.
Barbara Mowry, Chief Executive Officer, GoreCreek Advisors, Greenwood Village, Colo., named Deputy Chair.
Dallas
Herbert D. Kelleher, Founder and Chairman Emeritus, Southwest Airlines, Dallas, Tex., renamed Chair.
Myron E. Ullman III, Chief Executive Officer and Chairman of the Board, J.C. Penney Company, Inc., Plano, Tex., renamed Deputy Chair.
San Francisco
Douglas W. Shorenstein, Chairman and Chief Executive Officer, Shorenstein Properties LLC, San Francisco, Calif., renamed Chair.
Patricia E. Yarrington, Vice President and Chief Financial Officer, Chevron Corporation, San Ramon, Calif., renamed Deputy Chair.
-- Christine Nielsen
Lead Stories
EU Leaders Commit To New Fiscal Compact: Draft
Reuters
The European Central Bank spooked financial markets Thursday by dousing hopes of dramatic crisis-fighting action in the euro area shortly before European leaders began what the French president billed a last chance summit
http://jlne.ws/swTTBZ
ECB Launches New Crisis Measures, Won't Commit to Bigger Bond Buys
By MARGIT FEHER And GEOFFREY T. SMITH, WSJ.com
The European Central Bank responded Thursday to pressure for radical action to stop the rot in the euro zone's financial markets, but stopped well short of giving any commitment to increased purchases of government bonds.
http://jlne.ws/sD5bjV
China's Dagong Rating Agency Downgrades France
Reuters
Chinese rating agency Dagong downgraded France on Thursday, saying that the government would likely miss its deficit-reduction targets due to weaker-than-expected growth and the fallout from the euro zone's debt crisis."
http://jlne.ws/sPIFZi
Bottom Line - S&P: Entire 27-nation EU is at risk of downgrade "S&P: Entire 27-nation EU is at risk of downgrade
By msnbc.com news services
Ratings agency Standard & Poor's injected urgency into talks aimed at saving the euro currency from collapsing under the weight of huge state debt by warning Thursday that it may downgrade the bonds of all 27 EU nations."
http://jlne.ws/sODCKy
Draghi Courts Bundesbank in Bid to Avoid Trichet’s Bond Fate
Businessweek
http://jlne.ws/uUm3BI
Reading the Draghi Tea Leaves
CNBC
Draghi's ECB moves markets up, then down. S&P futures initially moved up, then down, as ECB head Mario Draghi said he was "surprised" by the reaction to his now-famous comment that "other elements might follow" if there was a new fiscal treaty. He said this was not necessarily a signal that he would be initiating more bond purchases.
http://jlne.ws/uw8SMl
ECB cuts key rate to 1%; BOE on hold
Market Watch
The European Central Bank on Thursday cut its key lending rate, while the Bank of England leaves its bank rate at a record low and makes no changes to its quantitative easing program.
http://jlne.ws/t3O5IN
ECB douses rescue hopes as EU seeks crisis deal
Reuters
http://jlne.ws/rtXO3V
Standard & Poor's Ratings Services: Long-Term 'AAA' Rating On The European Union Placed On CreditWatch Negative
Press Release
Standard & Poor's Ratings Services today placed its 'AAA' long-term issuer credit rating on the European Union (EU) on CreditWatch with negative implications. At the same time, we affirmed the 'A-1+' short-term issuer credit rating on the EU.
http://jlne.ws/sQj3bM
Fed's Discount Rate Among Tools to Counter Europe's Debt Crisis
BusinessWeek
The Federal Reserve could if necessary dig deeper into its toolkit to ease the sovereign-debt crisis in Europe, by cutting the U.S. discount lending rate or restarting a program that auctions loans to banks.
http://jlne.ws/spUQTK
Fed disputes report of secret help to big banks
Washington Post
The Federal Reserve has launched an unusual public rebuttal of media claims that the central bank massively subsidized big Wall Street banks during the financial crisis. Bloomberg News reported last week that emergency lending programs by the Fed gave major banks about $13 billion in extra profit by handing them money at below-market rates. The Washington Post, which has a content partnership ...
http://jlne.ws/v5klBq
Banks seek to avoid Volcker rule "fire sale"
Reuters via Yahoo! News
U.S. banks want regulators to give them more time to liquidate investments in certain private equity funds under the Volcker rule, arguing that without more leeway they will have to hold "fire sales."
http://jlne.ws/uhPBym
Accelerating U.S. Economy May Ease Pressure on Bernanke to Buy More Bonds
Bloomberg
"Recent economic data takes away some of the urgency for the need to engage in a new round of quantitative easing," said Michael Feroli , a former Fed economist who is now chief U.S. economist at JPMorgan Chase & Co. in New York. The Federal Open Market Committee "can say, 'Let's wait and see if this is going to build on itself.
http://jlne.ws/ufIGui
Events
Markets Demystified: OTC vs. Exchange-Traded Derivatives
December 8, 2011
The IFM Explains The OTC Market Vs Derivatives
http://jlne.ws/vGLTAx
Lifecycle of a Listed and OTC Derivatives Trade
December 8, 2011
The IFM Explains OTC Vs Listed Trades
http://jlne.ws/tb32fH
Fixed Income Markets 2012
January 24, 2012
Tabb Forum Looks At Changes Ahead And Staying Ahead In Fixed Incomes
http://jlne.ws/snQ3VO
Treasury Futures: Using International Fixed-Income and Money Market Spreads
January 31, 2012
The IFM Instructs On Using Fixed Income And Money Market Spreads
http://jlne.ws/u7MgUK
Exchanges, Clearing Houses & MTFs
DTCC warns of OTC threat from Asia
By Philip Stafford
The Depository Trust and Clearing Corporation (DTCC), the post-trade group, has warned that Europe and the US could lose derivatives business to Asia while they delay finalisation of new rules governing the vast off-exchange trading market.
http://jlne.ws/sjyr1f
LCH.Clearnet lowers margin on Italian bonds
MarketWatch
Clearing firm LCH.Clearnet has lowered the margin it requires traders to deposit to trade Italian government bonds, partly reversing a November rise. In a notice on its website dated Wednesday, the firm said the margin on Italian bonds was lowered, with the deposit required for bonds maturing in 7 to 10 years reduced to 8.15% from 11.65%. Italian bond yields have ...
http://jlne.ws/tQRLeb
CME forms panel to head off future MF Globals
Reuters
CME Group Inc., under fire for its handling of the collapse of futures brokerage MF Global Holdings Ltd., recently tasked a board committee to look at ways to defend against future failures. CME's strategic steering committee is spearheading the charge to see "how do you strengthen the system, if it's necessary," said a person close to the matter, who declined to be identified because the examination is just beginning. "It's not something you are going to get a decision on tomorrow, or anything like that."
http://jlne.ws/rPi8bo
Firms & Banks
Tradition swaps platform suffers glitch
By Philip Stafford, Financial Times
Tradition, the Swiss interdealer broker, was forced to halt dealing on its new interest rate swap platform for more than two hours earlier this week amid technical problems following an IT upgrade.
http://jlne.ws/v7xrdR
UBS, Citigroup $674 Million CMBS Price Talk Tighter Than Recent Deal
By Al Yoon, Of DOW JONES NEWSWIRES
UBS and Citigroup Global Markets expect to sell their $673.9 million in commercial mortgage-backed securities in coming days at yield spreads tighter than a similar issue that sold on Tuesday, according to an investor who has seen terms of the deal.
http://jlne.ws/suXK2R
Mortgage servicers at Chase, BofA slapped for poor performance
By Mary Ellen Podmolik, Chicago Tribune
The Treasury Department said Wednesday it would withhold loan modification incentive payments from Bank of America and JPMorgan Chase for the third consecutive quarter, and took Chase in particular to task for its poor compliance with federal loan modification programs.
http://jlne.ws/tCvlr9
Deutsche Bank, BNP May Be Cut by S&P in European Credit Review
BusinessWeek
Deutsche Bank AG and BNP Paribas SA are among European lenders that were placed on CreditWatch negative by Standard & Poor's amid a similar review of 15 countries in the region.
http://jlne.ws/u2yDEw
Santander to Sell Colombian Unit for $1.23 Billion
By DEALBOOK - NY Times
Grupo Santander, seeking to bolster its capital reserves, announced on Wednesday that it would sell its Colombian unit to CorpBanca of Chile for $1.225 billion.
http://jlne.ws/u8fznB
HSBC to widen mis-selling bond review
By Josephine Cumbo, Financial Times
HSBC is to extend its review of sales practices at NHFA, the discredited care home fees advisory group, following public outrage over the mis-selling of investment bonds to thousands of elderly and vulnerable customers.
http://jlne.ws/swctT7
JPMorgan increases lending to eurozone
By Shahien Nasiripour in New York, Financial Times
JPMorgan Chase has increased its lending to troubled eurozone economies, its chief executive said on Wednesday, as US rivals retreat from the region.
http://jlne.ws/vmonlG
Two Banks Repay $145 Million In TARP Funds, Provide Additional Positive Return On Tarp Bank Programs For Taxpayers
Press Release
The U.S. Department of the Treasury announced that the following two financial institutions have repurchased Troubled Asset Relief Program (TARP) Capital Purchase Program (CPP) investments, delivering a total of $145 million in proceeds today for taxpayers.
http://jlne.ws/sM7Q8w
Regulators
US Regulators To Propose Removal Of Credit Ratings In Capital Rules
By Alan Zibel, Dow Jones Newswires
U.S. bank regulators proposed Wednesday to remove references to credit ratings in requirements for how strong of a capital buffer banks must hold for their trading accounts.
http://jlne.ws/scjiVK
Testimony of Daniel J. Roth, President and CEO, National Futures Association
Before the Committee on Agriculture, U.S. House of Representatives
Press Release
http://jlne.ws/vl4Dvj
Regulators diverge over MF Global collapse
By Shahien Nasiripour, Tom Braithwaite and Kara Scannell, Financial Times
Regulators are expected to give diverging accounts about when they first became concerned over the state of MF Global, the broker-dealer that collapsed on October 31 with an estimated $1.2bn of customer money missing.
http://jlne.ws/tC0X2h
Federal Reserve May Thwart Dividend Plans From Bank of America and Citigroup
Marketwire
The Bedford Report Provides Equity Research on Bank of America & Citigroup
http://jlne.ws/uDZcqb
Fed's Yellen Sees Scope for More Easing to Spur Recovery
BusinessWeek
Federal Reserve Vice Chairman Janet Yellen said the central bank has leeway to spur the U.S. recovery and reduce unemployment by buying more assets or clarifying its plan to sustain record-low borrowing costs.
http://jlne.ws/uWCYJw
Bernanke Favored by 71%, Obama by 48% in Poll
Bloomberg
Federal Reserve Board Chairman Ben S. Bernanke's standing is soaring among global investors, who say the U.S. central bank is outperforming its European counterpart in economic crisis management, a Bloomberg poll shows.
http://jlne.ws/uIWhqg
Bloomberg News Responds to Bernanke Criticism
Bloomberg
Federal Reserve Chairman Ben S. Bernanke said in a letter to four senior lawmakers today that recent news articles about the central bank's emergency lending programs contained "egregious errors."
http://jlne.ws/rtl7si
Why We All Should Welcome Bernanke's Complaints: Matthew Winkler
BusinessWeek
Federal Reserve Chairman Ben S. Bernanke's response to Bloomberg News reporting regarding the Fed's emergency lending to banks and other companies, although hardly complimentary, sounded a welcome note of engagement by the U.S. central bank in issues that frame one of the most important financial stories of our time.
http://jlne.ws/voN2ul
Global News
Australia's Worst Jobs Gain in 15 Years Raises Rate-Cut Chances
BusinessWeek
Australia is headed for its worst year of jobs growth in 15 years, boosting prospects central bank Governor Glenn Stevens will extend interest-rate cuts into 2012 as inflation pressure eases.
http://jlne.ws/sXJBqU
Brazil's November Consumer Prices Increase 0.52%, Faster Than Expected
Bloomberg
Brazilian consumer prices rose faster than expected in November, cementing expectations the central bank won't have room to accelerate the pace of interest-rate cuts.
http://jlne.ws/vsX37k
Bank of England keeps policy settings steady, as expected
ShareCast
The Bank of England's Monetary Policy Committee has just announced its decision to maintain its key policy rate unchanged at 0.5%.
http://jlne.ws/uFhJBp
Vietnam Risks Stability If Policy Eased, IMF, World Bank Say
BusinessWeek
Vietnam may undermine progress toward economic stability if it loosens monetary policy now, the International Monetary Fund and World Bank said as the nation struggles with the fastest inflation in Asia.
http://jlne.ws/sff8qI
Chilean Policy Maker Sees Bank Keeping 'Neutral Stance' Amid Euro Criss
Bloomberg
Chilean policy makers may keep interest rates unchanged as Europe's debt crisis has a limited impact on the Andean nation, the central bank's deputy governor said, downplaying evidence of weaker domestic growth.
http://jlne.ws/tYwqDh
Indonesia Central Bank Pauses Interest-Rate Cuts to Assess Inflation Risk
Bloomberg
Indonesia's central bank kept its benchmark interest rate unchanged, pausing after cutting borrowing costs in the previous two meetings to assess the inflation risk as the rupiah falls.
http://jlne.ws/tFdZ83
Iceland's Central Bank Leaves Key Interest Rate Unchanged
Nasdaq
Iceland's Central Bank Leaves Key Interest Rate Unchanged
http://jlne.ws/uHEmtr
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