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Får vi en 2. bølge shorting?


2666 akademikeren 15/2 2009 15:46
Oversigt



Forklarer lidt om hvorfor markedet er shaky lige nu. Det er 2 skoler der står overfor hinanden. Rent markedet eller keynesiansk. Ret interessant at høre ham, men tilsidst kommer det også frem at Jim Rogers er short GE, JP Morgan



15/2 2009 16:04 akademikeren 02667



Geithner Reassures G-7 on Bank Plan, Is Urged to Move Ahead
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By Rebecca Christie and Simon Kennedy

Feb. 15 (Bloomberg) -- U.S. Treasury Secretary Timothy Geithner reassured Group of Seven counterparts about his plan to rescue the U.S. financial system and was urged to press ahead with the effort to clean up toxic assets and revive lending.

“It is a comprehensive plan, the intent is there, the will is there,” Bank of Canada Governor Mark Carney said yesterday. “The question is implementation and execution.”

Geithner came under fire from U.S. lawmakers and investors last week for failing to provide details on how he plans to shore up banks clobbered by $756 billion in credit losses. The S&P 500 Index dropped 4.9 percent, the most since Jan. 20, to 827.16 on the day of his announcement. Stocks fell over the week by the most since November.

Finance ministers and central bankers from the Group of Seven meeting in Rome were looking to Geithner to provide specifics on his $2 trillion plan to tackle the financial crisis that started in the U.S. 18 months ago and has since spread across the globe. The G-7 predicted a “severe” economic slump that will persist for most of 2009.

Reports last week showed Germany’s economy, Europe’s largest, contracted the most in 22 years in the fourth quarter and U.S. consumer confidence neared its lowest since 1981. Policy makers are seeking a coordinated approach to stanching the economic damage that’s prompting companies including Caterpillar Inc., Nissan Motor Co. and Alcatel-Lucent to cut jobs.

Restoring Confidence

The G-7 vowed to tackle the crisis without spelling out new steps to do so. Finance ministers and central bankers said in a statement yesterday that they were working to restore confidence in markets and revive the world economy. They predicted the full effect of individual countries’ rescue packages will “build over time.”

“We reaffirm our commitment to act together using the full range of policy tools to support growth and employment and strengthen the financial sector,” the statement said. “The stabilization of the global economy and financial markets remains our highest priority.”

The meeting took place as the U.S. Congress gave final approval to a $787 billion economic stimulus package that President Barack Obama said was needed to pull the world’s largest economy out of a recession. The package contains stricter limits on executive compensation at companies receiving U.S. funds than those proposed by the administration.

Clear Answers

Geithner answered questions from G-7 officials “very clearly,” Finance Minister Christine Lagarde told reporters in Rome yesterday. “On paper it looks great,” said Lagarde. “The essential thing is now to implement it.”

Bank of Italy Governor Mario Draghi was the most critical, saying the U.S. is “lagging in the implementation of the package.”

More details on a public-private partnership to buy banks’ illiquid assets will be delivered in coming weeks, a U.S. official said in Rome on condition he not be named.

Geithner’s plan to tackle the U.S. credit crisis also includes additional injections of capital into financial institutions and as much as $1 trillion to promote new lending to consumers and businesses.

Obama will this week provide a “high level of detail” on how he will help the housing market using $50 billion to $100 billion of the toxic-asset fund, the official said. Lawrence Summers, Obama’s top economic adviser, said last week that the administration intends to focus its efforts on reducing monthly payments for homeowners struggling with their mortgages.

Falling House Prices

Geithner’s rescue plan was met with disappointment by investors in the U.S. who said it failed to specify whether banks saddled with illiquid debt will be forced to fail, how tainted assets will be removed from their balance sheets and what will be done to stop falling house prices.

Geithner, 47, arrived in Italy urging his colleagues to take “extensive” steps to kick-start their economies. After the meeting he said there is now “a much greater scale of urgency and commitment” about taking on the crisis.

“Given the severity of the current economic and financial environment, these actions must be forceful and sustained for a period that matches the likely duration of the crisis,” he said.

The U.S. Treasury chief also tempered his criticism of China after last month accusing Chinese officials of “manipulating” their exchange rate. Yesterday he said he welcomes “their commitment” to making the yuan more flexible.

Working Closely

“The United States is very much committed to working closely and cooperatively with China as we move together to address this global economic crisis,” he said.

He also sought to ease concerns that the U.S. is resorting to protectionism by promising that a “Buy American” clause in Obama’s $787 billion economic stimulus program will comply with U.S. commitments to the World Trade Organization.

Geithner is familiar with the G-7 talks, which he attended as Treasury undersecretary for international affairs in the Clinton administration. As President of the Federal Reserve Bank of New York until moving to the Treasury, he also worked closely with many of the central bankers present in Rome.

“Tim is very knowledgable,” said European Central Bank President Jean-Claude Trichet. “He knows what he’s speaking about, he has a very easy way of expressing his views.”

Geithner was “a heavyweight at the table,” German Finance Minister Peer Steinbrueck said.



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