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Intel announced the ‘Jasper Forest’ line of processors earlier this year. The new processors, named for a petrified forest in Arizona, have gone from concept to prototype and Intel is giving customers a peak now at what the 45-nanometer Jasper Forest CPUs have to offer.
Jasper Forest is based on Intel’s robust Nehalem chip architecture. However, the Jasper Forest processors deliver unique functionality to benefit dense server environments such as storage and communications environments and it does so while reducing power consumption by 27 watts.
Seems like another week, another headline-making processor announcement. First AMD revealed the new 40-watt Istanbul chips, then Intel rolled out the Lynnfield processors and the P55 chipset. Now, Intel is making news again by announcing it is ready to start shipping the Jasper Forest processors.
Intel derived increased functionality and reduced power consumption by integrating some I/O functionality into the processor itself. The result is that those functions are managed more efficiently and they do not require a separate controller which lowers the overall power consumption of the system.
The processors are capable of configuring RAID 5 or RAID 6 data protection natively without an additional RAID controller. Jasper Forest processors also integrate PCIe hub functions which allows for even thriftier use of power and space.
Jasper Forest processors also help prevent data loss in the event of a power failure using a Asynchronous Dynamic Random Access Memory Self-Refresh Memory. If ever a technology was in need of a catchy acronym- I think this might be it. We’ll go with ADRAMSRM. The ‘ADRAMSRM’ feature detects power failure as it is happening and allows the memory controller to complete its functions before shutting down so no data is lost.
The Jasper Forest processors will be available in single and quad-core versions operating between 23 and 85 watts using the same CPU socket. Intel is backing the processors up with 7-year lifecycle support so customers can purchase with confidence that next week’s CPU headlines won’t render the Jasper Forest purchase obsolete prematurely.
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Asian Markets Fall on Commodity Stockpiles
y Patrick Rial and Jonathan Burgos
Sept. 18 (Bloomberg) — Asian stocks fell, dragging the MSCI Asia Pacific Index from a one-year high, as Aiful Corp. sought to reschedule debt payments and Hong Kong’s central bank said competition on mortgages may hurt the city’s lenders.
Aiful Corp., Japan’s third-largest consumer lender by revenue, plunged 27 percent. Takefuji Corp., the country’s No. 4 consumer lender by revenue, lost 9.5 percent. Hang Lung Properties Ltd. sank 3.9 percent in Hong Kong on speculation lending for housing purchases will be curtailed. BHP Billiton Ltd., the world’s No. 1 mining company, slipped 2.3 percent after metal prices declined yesterday.
The MSCI Asia Pacific slipped 0.4 percent to 118.39 as of 7:30 p.m. in Tokyo, falling from its highest close since Sept. 8, 2008. The index climbed 68 percent from a five-year low on March 9 through yesterday as stimulus measures around the world pulled economies out of recession. Stocks in the gauge are priced at an average 1.6 times book value, the highest since September 2008.
“We are not completely out of the woods yet,” said Marco Wong, Singapore-based chief investment officer for Asia excluding Japan at SG Asset Management, which has $351.6 billion in assets globally. “Much of the recovery has been due to stimulus measures. We have to see how things pan out once the measures are withdrawn.”
The Nikkei 225 Stock Average dropped 0.7 percent in Japan, where markets will be shut for holidays until Sept. 24. Sumitomo Osaka Cement Co. tumbled 9.6 percent after cutting its profit forecast. Share-sale plans dragged Shandong Huatai Paper Co. down by 6.2 percent in China, where the Shanghai Composite Index fell 3.2 percent. BOC Hong Kong (Holdings) Ltd. sank 7.1 percent after its chief executive officer sold shares in the company.
Credit Crisis
Futures on the U.S. Standard & Poor’s 500 Index were little changed. The benchmark fell 0.3 percent yesterday as companies including FedEx Corp. and Oracle Corp. reported sales that missed analysts’ estimates….
Europe Follows Asia into a Slump
By Sarah Jones
Sept. 18 (Bloomberg) — European and Asian shares declined, ending a three-day rally for the MSCI World Index, on concern a six-month rally in global equity markets has outpaced the prospects for earnings and economic growth.
Lonmin Plc and Antofagasta Plc led mining shares lower as metal prices fell. Lloyds Banking Group Plc slipped 1.1 percent after the lender said it’s considering alternatives to a government asset protection program. Super de Boer surged 19 percent after receiving a takeover offer from rival Dutch retailer Jumbo Groep Holding BV that values the company at about 482 million euros ($708 million).
The MSCI World slid 0.3 percent at 11:33 a.m. in London, trimming this week’s advance to 1.8 percent. The gauge of stocks in 23 developed nations has surged 65 percent since March 9, driving its valuation to more than 27 times reported earnings, the highest level since June 2003.
“I still think the market is showing all the characteristics of a bear-market rally,” said Philippe Gijsels, a senior structured-equity strategist at Fortis Global Markets in Brussels. “People have become too optimistic about the economic outlook and sentiment has been fairly bullish. I still think we are in for a rough ride from here.”
Europe’s Dow Jones Stoxx 600 Index fell 0.3 percent. The MSCI Asia Pacific Index lost 0.4 percent as China’s Shanghai Composite Index slumped 3.2 percent. Aiful Corp., Japan’s third- largest consumer lender by revenue, was untraded, with shares offered lower by 27 percent, after the company sought to reschedule debt payments…..
Oil Trades Down Just Under $72pb
KUALA LUMPUR, Malaysia (AP) – Oil prices weakened Friday in Asia, dampened by concerns that a recovery in the U.S. economy may be slower than expected.
Benchmark crude for October delivery fell 29 cents to $72.18 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell 3 cents to settle at $72.47 on Thursday.
Victor Shum, an energy analyst with consultancy Purvin & Gertz in Singapore, said oil prices pulled back in tandem with a slide in regional stock markets and a stronger U.S. dollar.
The moves followed new U.S. government data indicating a slow economic recovery, which may mean less demand for energy by the world’s largest crude user in the near term.
“There is a supply overhang in both crude oil and products. Oil pricing at a $70 plus level is quite vulnerable given the weak fundamentals,” Shum said.
The recession has sapped American fuel consumption, and U.S. oil stockpiles are 14 percent larger than last year. The Energy Information Administration said Wednesday that the country also is sitting on a sea of distillate fuels including heating oil, with stockpiles approaching a 27-year high.
The government reported Thursday that natural gas stockpiles continue to grow as well and are now at 16.4 percent above the five-year average for this time of year.
There are some bright spots.
The Labor Department said new claims for unemployment benefits fell to the lowest level since July. And the Commerce Department said housing construction in August surged to the highest level in nine months with a flurry of new apartment building projects.
While on the surface that would suggest energy consumption may rebound, the jobless numbers however, are far below levels that would indicate a healthy economy.
Shum said oil has traded within the $65-$75 a barrel since July and likely to stay within this range in the coming months.
In other Nymex trading, gasoline for October delivery slipped 0.47 cent to $1.8465 a gallon, and heating oil dipped 0.61 cent to $1.8348 a gallon. Natural gas rose 6.2 cents to $3.52 per 1,000 cubic feet.
In London, Brent crude fell 16 cents to $71.39.
U.S. Dollar & Yen Strengthen as Markets Slip
During early deals on Friday, the US dollar and the Japanese yen edged higher against their major counterparts as a fall in most Asian and European stock prices boosted demand for currencies perceived as safe havens.
The dollar and the yen are viewed as safe-haven currencies and both currencies gain, when investors turn risk averse and fall when risk appetite improves.
The dollar climbed to a 2-week high against the British pound and a 2-day high versus the European currency.
Blackrock To Buy 50% of London’s Broadgate Complex
y Chris Bourke
Sept. 18 (Bloomberg) — Blackstone Group LP agreed to buy 50 percent of Broadgate, the largest office complex in London’s main financial district, from British Land Co. in a transaction that values the properties at 2.1 billion pounds ($3.4 billion).
The sale of Broadgate, built next to Liverpool Street station in the City of London in the mid-1980s, is the biggest in the U.K. capital since the commercial-property slump began two years ago. British Land said the deal will reduce its debt and make acquisitions easier, according to a statement today.
Blackstone, the world’s biggest private equity firm, will pay 77 million pounds for the stake and assume 987 million pounds of debt, British Land said. The London-based real estate investment trust sought a Broadgate partner after raising more than 1 billion pounds this year to bolster its balance sheet. Broadgate is the company’s largest asset and about 2 billion pounds of the complex’s value is in securitized debt…..
UBS Has Created A Flood of Truth Telling With Their Tax Settlement To the U.S.
By Carlyn Kolker and David Voreacos
Sept. 18 (Bloomberg) — UBS AG’s $780 million settlement with U.S. authorities to avoid prosecution for helping Americans cheat on their taxes has opened a Pandora’s box for banks worldwide.
A U.S. tax program encouraging UBS clients to avoid criminal inquiries by declaring offshore accounts before Sept. 23 is prompting a flood of disclosures by customers of Zurich-based Credit Suisse Group AG and Julius Baer Holding AG, LGT Group in Liechtenstein, London-based HSBC Holding Plc, and Bank Leumi Le-Israel Ltd., tax attorneys said.
That may give the Internal Revenue Service ammunition to target other overseas wealth managers as it seeks to crack down on tax evasion. UBS, the largest Swiss bank, avoided prosecution on Feb. 18 when it admitted helping Americans dodge taxes, paid a $780 million penalty, and disclosed secret data on 250 clients. In August, UBS agreed to reveal another 4,450 clients to settle a U.S. lawsuit seeking more data….
Foreign Currencies Get Bot in a Flurry In Anticipation of G-20 Raising Rates
By Laura Cochrane and Anil Varma
Sept. 18 (Bloomberg) — Investors are buying Indian rupees, South Korean won and Brazilian reais, betting developing nations will raise interest rates even after the Group of 20 said it’s too early to end central bank support for the global economy.
Swap contracts, in which traders exchange a fixed rate for a floating one, indicate the market is pricing in the fastest increases in borrowing costs in the G-20 in India and South Korea. The cost of a one-year agreement in India has risen to 1.55 percentage points over the central bank’s benchmark, up from 0.95 point on June 30. Spreads in Indonesia and Brazil have also grown and are wider than the U.S., Germany and Japan.
Threadneedle Asset Management Ltd., Schroders Plc and Ashmore Investment Management Ltd. say they are buying emerging- market currencies as policy makers in New Delhi, Seoul and Brasilia become more focused on avoiding inflation and stock- market bubbles than on supporting the global recovery. The won and the rupee will be the world’s best-performing currencies in the year ahead, each gaining about 7 percent, median estimates in Bloomberg strategist surveys show.
“It’s going to be the emerging-market world that sees rate hikes first, and that should support currencies,” said Richard House, who manages $2 billion in developing-nation fixed income at Threadneedle in London and started buying the rupee and the real in the past month. “India will be among countries that will be first.”
The International Monetary Fund forecasts developing nations will expand 4.7 percent next year, almost eight times faster than the 0.6 percent growth in advanced economies. Consumer prices will rise 4.6 percent, dwarfing developed countries’ 0.9 percent inflation rate, the IMF predicts.
‘Imbalances’…..
Lending is Stingy & For Good Credit Score Only
NEW YORK (AP) – It’s a good time to borrow money for a home, car or small business.
A year after a global freeze in the credit markets prompted massive government intervention to prevent the financial system from collapsing, interest rates remain at historic lows. But banks are demanding more collateral, bigger down payments and detailed financial histories from borrowers.
And that’s for people with good credit. Everyone else need not apply.
The stingy lending is likely to last.
“Banks are going to be in a defensive posture for several years. Most borrowers can’t meet their criteria,” says Christopher Whalen, managing director at research firm Institutional Risk Analytics.
No segment of borrowers has been spared:
– Nearly seven of 10 mortgage applications were approved and financed during the housing boom five years ago. At the end of 2008, the number was down to five.
– Revolving credit, which is primarily made up of credit card debt, declined by $6.1 billion, or 8 percent on an annualized basis, in July. That’s a sign consumers are having difficulty obtaining credit and are cutting back on spending.
To be sure, it is cheaper for businesses and consumers to take out a loan today than it was at the height of the crisis last fall.
The average 30-year mortgage rate stands at 5.04 percent, after falling to a record low of 4.78 percent in April. The overnight rate that banks charge each other to borrow money – a key indicator of the credit markets’ overall health – has plummeted. The London Interbank Offered Rate, or LIBOR, stands at 0.29 percent today. It soared above 6 percent last September when fear threatened to choke off lending throughout the financial system.
But those improvements are somewhat misleading. Lending – especially for homes – is being greased by trillions of dollars the federal government has made available to banks.
The Federal Reserve has provided nearly $340 billion in low-cost loans for banks. It has purchased $625 billion worth of mortgage-backed securities to drive down interest rates on home loans. The Federal Deposit Insurance Corp. is guaranteeing about $300 billion in bank debt, which enables banks to borrow at lower rates.
No one wants to see a return to the easy credit that led to the financial crisis. The question is when will credit return to normal – not too loose, not too tight and not propped up by the government?
Not soon, financial analysts and government officials say.
“We will not make the mistake of prematurely declaring victory or prematurely withdrawing public support for the flow of credit,” says Lawrence Summers, the White House’s top economic adviser.
Some analysts think it could take four or five years for the Fed to withdraw the money entirely and shrink a balance sheet that is now about $2 trillion, more than double what it was when the financial crisis struck……
SEC Decides on More Regulatory Rules
WASHINGTON (AP) – Regulators on Thursday proposed rules designed to stem conflicts of interest and provide more transparency for credit rating companies. They also proposed banning “flash orders,” which give some traders a split-second edge in buying or selling stocks.
The changes, which were opened to public comment for 60 days, could eventually be adopted by the agency, possibly with revisions.
The credit rating industry was widely faulted for its role in the subprime mortgage debacle and the financial crisis. The five members of the Securities and Exchange Commission voted at a public meeting to propose rules that could reshape an industry dominated by three firms: Standard & Poor’s, Moody’s Investors Service and Fitch Ratings. Their practices would be opened wider to public view and subject to some restraints.
Regulators say they also hope to spur more competition in the rating industry, with possibly new entrants – as well as the other seven existing agencies – challenging the dominant firms. One of the SEC’s proposals is intended to bar companies from “shopping” for favorable ratings of their securities, by requiring companies to disclose whether they had received preliminary ratings from other agencies.
Meanwhile, flash orders have become a hot-button issue in recent weeks amid questions about transparency and fairness on Wall Street. A flash order refers to certain members of exchanges – often large institutions – buying and selling information about ongoing stock trades milliseconds before that information is made public.
Nasdaq OMX Group Inc., which operates the Nasdaq Stock Market, and the BATS exchange have voluntarily stopped using flash orders, which made up an estimated 3 percent of stock trading. The New York Stock Exchange has never used them…..
C & IBM Remain Top Brands of All Time
Consumers lost trust in brands this year as the recession deepened, according to an industry report released Thursday, although longtime staples Coca-Cola and IBM retained their spots as the world’s two most valuable brands.
This is the first time the combined value of the world’s top 100 brands as ranked by Interbrand, a branding agency, has fallen in the 10 years Interbrand has assessed them.
The list’s total value, including brands like Google Inc., Nintendo and Sony, fell 4.6 percent to $1.15 trillion, Interbrand estimates.
“That says something about the environment that we’re in, especially when you consider that brands are by nature less volatile than business valuations,” said Interbrand CEO Jez Frampton, who called a company’s brand its most valuable asset.
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The environment – a recession the likes of which the world hasn’t seen for decades – has eaten away at people’s trust in specific brands, starting with financial companies, he said. Consumers even started to question retail brands as stores slashed prices to get sales, leading consumers to wonder about pricing, and why they had to pay so much before.
“All of these things lead you to re-evaluate the nature of the relationships that we have with brands and indeed how confident we feel in brands to live up to the promises they make,” he said. “Brands are promises which we value and are prepared to pay for and if we feel those promises have been broken we’re less likely to trust.”….
GOOG Unveils A New Add Display
By JESSICA E. VASCELLARO
Google Inc. Friday announced a highly anticipated service that will make it a middleman for selling graphical ads over the Internet.
The technology, called the DoubleClick Ad Exchange, resembles a stock exchange for display ads, ads with images and text that appear alongside content on a Web page. It allows companies that buy ads to bid for ad space across lots of different Web sites, from blogs to major entertainment properties, in real-time based on what publishers want to sell that second. Today display ads are often purchased ahead of time through negotiations with individual Web sites or networks of sites, a process which leaves publishers with lots of unsold space.
Google believes that the new technology will help publishers earn more revenue from display ads by creating a competitive auction for their space — an approach Google used to crack the search-advertising market. It argues that the service will compel advertisers to buy more display ads by aggregating more Web pages for them to buy across.
“With a multitude of display-ad formats and thousands of Web sites, it often takes thousands of hours for advertisers to plan and manage their display-ad campaigns. With this complexity, lots of advertisers today just don’t bother, or don’t invest as much as they would like,” wrote Neal Mohan, a Google vice president, in a blog post. “We believe that a better system built on better technology can help grow the display-advertising pie and benefit everyone.”….
Citadel Offers An Exchange of Stock For Debt
(Reuters) – Citadel Broadcasting Corp (CTDB.OB) offered a deal to exchange a major part of its debt for equity to senior lenders owed $2 billion, including JPMorgan Chase & Co (JPM.N), GE Capital and ING Groep NV (ING.AS), the Wall Street Journal said, citing people familiar with the negotiations.
On Wednesday, Citadel faced a deadline to make a $2 million interest payment, but the status remained unclear, the paper added.
Discussions have slowed in recent days in part as some lenders have been caught off-guard by Federal Communications Commission rules intended to limit concentrated holdings of media firms, the people told the paper.
Citadel could not be immediately reached for a comment by Reuters.
In June, Citadel, which operates the ABC Radio Network, hired Lazard Freres as an advisor to evaluate options, including a possible refinancing and restructuring of its capital structure.
C May Spin off Oil Trading Unit
Citibank is looking to spin off a controversial oil trading unit where the star trader could collect $100m in pay this year, according to Vikram Pandit, the chief executive.
Mr Pandit indicated that Citi wanted to reduce its ownership in the unit, called Phibro, and get it to manage money from outside investors.
At present Phibro, which is run by Andrew Hall, trades with Citi’s capital.
“We have been looking at the possibility of transforming [Phibro] from what it was, a proprietary trading [unit] to an asset manager,” Mr Pandit told a New York audience.
He did not provide additional details. But when asked whether a $100m compensation package was excessive for anyone on Wall Street, he replied “Yes”.
Citi has been looking for options for Phibro for months following revelations that Mr Hall had a contract that could guarantee him a bonus worth that amount this year…..
By JOHN F. COGAN, JOHN B. TAYLOR AND VOLKER WIELAND
Is the American Recovery and Reinvestment Act of 2009 working? At the time of the act’s passage last February, this question was hotly debated. Administration economists cited Keynesian models that predicted that the $787 billion stimulus package would increase GDP by enough to create 3.6 million jobs. Our own research showed that more modern macroeconomic models predicted only one-sixth of that GDP impact. Estimates by economist Robert Barro of Harvard predicted the impact would not be significantly different from zero.
Now, six months after the act’s passage, we no longer have to rely solely on the predictions of models. We can look and see what actually happened.
Consider first the part of the package that consists of government transfers and rebates. These include one-time payments of $250 to eligible individuals receiving Social Security, Supplemental Security Income, veterans benefits or railroad retirement benefits–and temporary reductions in income-tax withholding for a refundable tax credit of up to $400 for individuals and $800 for families with incomes below certain thresholds. These payments, which began in March of this year, were intended to increase consumption that would help jump-start the economy. Now that a good fraction of these actions have taken place, we can assess their impact.
The nearby chart reviews income and consumption through July, the latest month this data is available for the U.S. economy as a whole.
Consider first the part of the chart pertaining to the spring of this year and observe that disposable personal income (DPI)–the total amount of income people have left to spend after they pay taxes and receive transfers from the government–jumped. The increase is due to the transfer and rebate payments in the 2009 stimulus package. However, as the chart also shows, there was no noticeable impact on personal consumption expenditures. Because the boost to income is temporary, at best only a very small fraction was consumed.
This is exactly what one would expect from “permanent income” or “life-cycle” theories of consumption, which argue that temporary changes in income have little effect on consumption. These theories were developed by Milton Friedman and Franco Modigliani 50 years ago, and have been empirically tested many times. They are much more accurate than simple Keynesian theories of consumption, so the lack of an impact should not be surprising……
From Rebel Traders We Find “What’s on the Wires”
The very first thing that hit the wires early this morning was a statement made by Ivan Seidenberg, CEO of Verizon Communications (VZ). What did he say?
Ivan Seidenberg…
“US economy is still contracting, sees no new job creation; manufacturers of 4G (LTE) are on target- Small business volumes are not being seen at levels that were hoped for.
– Addressable market volumes are seen down y/y
You understand that the only place his statements showed up (that I could locate) was on the wire service (the same one that I know for a fact that CNBC also pays money to have, it is one of my feeds as well. But of course CNBC failed to ever mention this news as this kind of news is no longer part of CNBC’s business model.
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The Iowa Attorney General; Tom Miller, had a meeting with President Obama today where he told the President that “Payment option ARMs are about to explode“. Tom Miller went on to say “It’s the other shoe,” he said. “I can’t say it’s waiting to drop. It’s dropping now.”
Option ARMs are unique in that they offer an option to pay only the interest each month or a low minimum payment that leads to a rising balance in the loan’s principal.
When the balance of the loan reaches a certain level or the mortgage hits a specific date, the borrower must begin making full payments to cover the new amount. The loan’s interest rate also may have been fixed at a low level for the first few years with a so-called teaser rate, but then reset to a higher level.
Because the new monthly payments can be five or 10 times what borrowers are accustomed to paying, they “threaten a much greater hit to the consumer than the subprimes,” Goddard (Attorney General of Arizona) said, referring to the mortgages often extended to less credit-worthy borrowers that fed the first wave of the financial crisis.
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Then we have Standard & Poors about to make major downgrade of CDO’s.
S&P to adjust ratings methodologies on CDO tranches within the next few months
– notes changes could result in multilevel downgrades
– Value of CDOs affected at approx $580B; 4,790 tranches
– may also cut 1625 European CDO
Week 36, 2009 saw a 22.7% decline in railroad carloads.
This is worse than last week’s decline of 5.2% and the prior 4-week average decline of 14.0%.
Recall that Labor Day fell one week later in 2009 versus 2008, thus the y/y comparisons for Week 36 are very difficult.
If we consolidate absolute carloads for Weeks 35 and 36, the y/y decline versus the same 2-week period in 2008 was 14.4%.
National Bureau of Economic Research’s (NBER) Hall: May wait until economy moves past prior high before deeming recession over; could take 18 months before that occurs.– Comments that the upturn could in fact be part of a larger decline RT note: Uh, that is why it is a secular bear market Mr. Hall)
New Orders: 3.3 v 4.2 prior
Employment: -14.3 v -12.9 prior
Inventories: -18.1 v 0.3 prior
6-month business conditions outlook: 47.8 v 56.8 prior