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Spain’s biggest bank offers shares in its Brazilian businessTHE filing by Spain’s Banco Santander on September 3rd to carry out an initial public offering (IPO) of shares in its Brazilian unit may seem plucky given rising default rates on bank loans. But an offering looks certain to succeed. The Brazilian economy is in decent shape: GDP growth should reach a healthy 4% in 2010, according to the latest survey of economists by the central bank. Appetite for Brazilian assets has been strong this year, VisaNet’s 8.4 billion reais ($4.3 billion) offering in June being the most eye
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-catching example. And Santander’s successful navigation of the financial crisis should also ensure hefty demand. The IPO, which is expected to take place this year, could raise as much as ten billion reais for a 15% stake, based on estimates of the unit’s current market value.Santander will spend the bulk of the money on an aggressive expansion of branches and ATMs in the richer south and south-east of the country, which accounts for some 75% of national output. That should help the bank consolidate its position in Brazil, where a judicious blend of acquisition and organic growth has given it a more Brazilian face than other foreign-owned banks. Santander bought Banespa, a Sao Paulo state bank, in 2000 and last year completed its acquisition of ABN AMRO’s Brazilian business, making it the fourth-largest bank in the country. It has sensibly kept the services of Fabio Barbosa, who used to head ABN’s Brazilian operations and is widely admired. ...
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Greetings once again, Everyone!
The IntraDay Market Corrections we have spoken of have surely come to Fruition, as The Dollar and The Yen strengthen on overall Market Sentiments.
The Dow and The S&P are largely “flat” coming into additional Bernanke Testimony, as we are, once again, dealing with Ranging and somewhat “Directionless’ Market activity moving forward.
We can [...]
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Greetings again, Everyone at The NYSE Close!
Sectors, The Indices, and overall Market “Sentiment” are all in positive Territory primarily on the back of continued Positive Earnings across many Sectors.
While we arrive at a 7-Day Positive Rally… I will bring up a Term all of you have heard me mention several times in the past few [...]
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If Lehman had not failed, would the crisis have happened anyway?IN AUGUST 2008 Kenneth Rogoff, a Harvard University economist, briefly rocked world stockmarkets when he warned a conference in Singapore: “We’re not just going to see midsized banks go under in the next few months, we’re going to see a whopper, we’re going to see a big one—one of the big investment banks or big banks.” A month later, in the early hours of September 15th, Lehman Brothers filed for bankruptcy. Harold James, an economic historian at Princeton University, says Lehman’s failur
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e was analogous to the collapse of Creditanstalt, a big Austrian bank, in 1931. Austria and Germany had borrowed heavily from foreign creditors and the bank’s failure rippled around the world, vastly intensifying the Depression. Lehman’s failure is widely seen as a similar turning-point in the current financial crisis: an unexpected blunder that came close to turning a garden-variety recession into another Depression. ...
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Greetings Everyone, and Welcome to Wednesday!
We prepare for the Bank of England Minutes to be released, as we look for any additional signs of increased Stimulus since they failed to do their “Allocated Increase” of 25B Sterling in additional Asset Purchases.
The Markets will be especially watchful for any Rhetoric or Indications of a “Timeline” of [...]
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Wall Street and the City of London survived thanks to state support. Now they need to be weaned off it“WE HAVE a long track record of pulling together when times are tough…We’re on the right track.” Thus spoke the boss of Lehman Brothers on September 10th 2008. Within five days Lehman had gone bust and it quickly became clear that the world’s financial system had problems far beyond a single badly run investment bank and temporarily frozen credit markets. After two decades of expansion and deregulation, and the greatest bull market finance has ever known, many of
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the world’s banks were dangerously undercapitalised. Governments were forced to step in, providing capital, loans and guarantees to banks. In America, the euro zone and Britain the sums involved so far amount to about one sixth of GDP. A year on from Lehman that still looks like the right call. After the crash in 1929 America’s economy shrank by a quarter and the unemployment rate hit 25%. This time round, with the banks wrapped in cotton wool, extremely low interest rates and big public-spending packages, the economic distress has been massively smaller. Yet the recession has still been extremely painful, prompting a sense of outrage at the financial industry and in particular the big wholesale banks that execute transactions for clients and trade on their own account. This reflects not just their past sins, but also the perception that nothing has really changed. ...
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Greetings again, Everyone!
We arrive about 75 Minutes into The NYSE Open where the Dow and S&P Indices are varying from largely “Flat” to a bit of early Gains. Bernanke’s continued Testimony today will continue to play a large part in Equity sentiment today, as will the continued Roll-Outs during Earnings Season.
Our Thought on the MPC Minutes [...]
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Greetings again, Everyone!
We have had some time to “digest” a significant portion of Bernanke’s Testimony on The Hill, as well as today’ EIA Crude Inventory Builds and we see our Crude/Equities/Euro Correlations functioning well from an IntraDay View.
While in the “Trasditional” sense, The Fiber’s Correlation with Gold is always significant… we often see Oil playing [...]
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Andreas Treichl of Erste Bank thinks banks should be kept small and simpleHE MAY be descended from five generations of bankers and head a large bank himself, but Andreas Treichl has a pretty low opinion of his profession. He had hoped to become a conductor, but changed his mind on the advice of Leonard Bernstein. The maestro saw him perform, Mr Treichl says, and “told me to go into banking because one would do better as a mediocre banker than one would as a mediocre conductor.”Happily, most observers consider his tenure at Erste Bank, Austria’s second biggest, which he has ru
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n for more than a decade, better than mediocre. He has transformed the staid, insular, 200-year-old savings bank into one of the largest retail banks in central and eastern Europe. Although he led it into a region that subsequently found itself on the front-line of the financial crisis, he has managed to keep it profitable and independent. To be sure, Erste Bank has not escaped the crisis unscathed. Earlier this year it had to raise €1.8 billion ($2.3 billion), including €1.2 billion from the Austrian government, to bolster its capital, and provisions for bad loans have more than doubled in the first half of this year compared with a year earlier. Yet these setbacks look inconsequential when set against the monstrous losses reported by bigger banks farther afield. ...
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Greetings again, Everyone at The NYSE Close!
Well… I think for the first time in the history of The Blog… I really do not have a lot to say!
OK OK… All of you can stop cheering now!… hee hee hee…   
 
Seriously… the continual Summer “Directionless” Sentiment out on the Larger Time-Cycles are certainly a sign [...]