Monday, May 12, 2008

Trichet to Banks: Disclose by mid year. Pretty please?

from Dow Jones Newswire

ECB's Trichet: Banks Must Disclose Risks In 1st Half Results
April 12th 2008
MILAN -(Dow Jones)- Stability risks to the global financial system from de- leveraging and risk re-pricing shouldn't be underestimated, European Central Bank President Jean Claude Trichet said Monday, as he called on banks for full disclosure in their upcoming reporting.
"Financial institutions...should fully and promptly disclose their risk exposures, write downs, and fair value estimates for complex and illiquid instruments for their upcoming mid-year reporting," he said in a conference speech.
He was referring to recommendations made by the Financial Stability Forum ( FSF) at a recent G7 meeting.
"Moreover, the International Accounting Standards Board (IASB) and other relevant standard-setters should take urgent action to improve the accounting and disclosure standards for off-balance sheet entities, and to enhance guidance on fair value accounting, particularly valuing financial instruments in periods of stress," he said.
-By Jennifer Clark, Dow Jones Newswires, +39 335 833 5761, jenniferMclark@

Oh Jean Claude, you manly man you. Noble

McCain on Climate Change


May 13, 2008
McCain Differs With Bush on Climate Change

PORTLAND, Ore. — Senator John McCain sought to distance himself from President Bush on Monday as he called for a mandatory limit on greenhouse gas emissions in the United States.
Mr. McCain, the presumptive Republican presidential nominee, also pledged to work with the European Union to diplomatically engage China and India, two of the world’s biggest polluters, if those nations refused to participate in an international agreement to slow global warming.
In what his campaign promoted as a major speech on climate change, the Arizona senator renewed his support for a “cap-and-trade” system in which power plants and other polluters could meet limits on greenhouse gases by either reducing emissions on their own or buying credits from more efficient producers.
“Instead of idly debating the precise extent of global warming or the precise timeline of global warming, we need to deal with the central facts of rising temperatures, rising waters and all the endless troubles that global warming will bring,” Mr. McCain said at a wind power plant in Oregon, a state that is expected to be a political battleground in the general election and where the environment is a central issue for voters. “We stand warned by serious and credible scientists across the world that time is short and the dangers are great.”
Mr. McCain added pointedly: “I will not shirk the mantle of leadership that the United States bears. I will not permit eight long years to pass without serious action on serious challenges.”
The senator’s remarks were a direct criticism of Mr. Bush, who in his first term questioned the scientific basis for global warming and has remained adamantly opposed to mandatory caps on emissions as bad for the American economy.
The speech, a compilation and sharpening of many of Mr. McCain’s existing proposals, was most notable as a political address that sought to appeal to the independents the senator is wooing for the November election. It put Mr. McCain slightly to the right of center in the environmental debate.
Mr. McCain is the only Republican presidential candidate this year to call for mandatory limits on greenhouse gas emissions, but his target for reducing those emissions over time is lower than that of his Democratic competitors, Senators Hillary Rodham Clinton and Barack Obama, and even lower than that in a bill proposed by Senator Joseph I. Lieberman, independent of Connecticut, and Senator John W. Warner, Republican of Virginia.
In his speech, Mr. McCain advocated cutting emissions 60 percent below 1990 levels by 2050; Mrs. Clinton and Mr. Obama propose cutting them by 80 percent over the same period, while the Lieberman-Warner bill calls for a 70 percent reduction.
In another contrast with Mr. Bush, Mr. McCain also sought to persuade voters that he has a personal concern and first-hand experience with the climate change that has emerged as a major issue in the 2008 presidential race.
“A few years ago I traveled to the area of Svalbard, Norway, a group of islands in the Arctic Ocean,” Mr. McCain said. “I was shown the southernmost point where a glacier had reached 20 years earlier. From there, we had to venture northward up the fjord to see where that same glacier ends today because all the rest has melted.”
He added: “On a trip to Alaska, I heard about a national park visitor’s center that was built to offer a picture-perfect view of a large glacier. Problem is, the glacier is gone. A work of nature that took ages to form had melted away in a matter of decades.”

Mr. McCain welcome to the real world. This issue is too important for partisanship or nationalism. Your positions are not yet aggressive enough but they are a start. Energy Efficiency is a not just good for the environment but is directly proportional to growth. Noble

Jamie Dimon on the Consumer Recession

Long slump may follow crunch: JPMorgan CEO
Mon May 12, 2008 2:37pm EDT

By Joseph A. Giannone
NEW YORK (Reuters) - JPMorgan Chase & Co (JPM.N: Quote, Profile, Research) Chairman and Chief Executive Jamie Dimon on Monday told bank investors that while the current credit market crunch may soon be over, the U.S. economy could still face a deep and extended recession.
The slump in mortgage and corporate loan markets could bottom out this year, said Dimon, whose bank largely side-stepped the losses and mark-downs that have hobbled rivals during the past year.
Yet the economy may face a longer-term challenge even as financial markets begin to function again, the "slower burn" of a recession that may rival the severity of the 1982 contraction, he said.
These challenging conditions, marked by tighter bank credit, new rounds of mark-downs, further capital infusions and asset sales by banks, could last through next year and into 2010, he said.
If that happens, Dimon warned that New York-based JPMorgan and its national consumer lending businesses would suffer some significant losses, such as home equity losses doubling to $900 million by year-end.
Dimon further warned that the bank would have to continue boosting loan-loss reserves if economic conditions deteriorate, further eating into profit.
In the current quarter, Dimon said subprime mortgage losses could rise to between $200 million and $250 million, with prime mortgages generating about $100 million in losses.
Loss rates in JPMorgan Chase's massive credit card business are expected to reach 5 percent in the second quarter and rise to as high as 6 percent next year, while at the same time interest and fee revenue decline.
The third-largest U.S. bank also expects to write down "several-hundred-million" dollars of auction rate securities, he said.
(Editing by Braden Reddall)