Archive for April 2009

IMF Reccomends Stronger Measures to Fight the Global Financial Crisis (2)

We come back to the IMF handbook published on April 2009, called “Global Financial Stability Report”. This time, we make refference to its reccomendations.

But before this, a new estimation of the IMF on the global write downs of assets. In January 2009 IMF estiamted the bad assets writing off to around $2.7 billion in the US only. In this latest report, the estimations included also other mature market-originated assets, which could increase the total write offs to around $4 billion. In other words, $4 billion of the US economy has been wiped off by the financial crisis (or will be, total until the end of 2010). Scary, isn’t it? Read more

IMF Reccomends Stronger Measures to Fight the Global Financial Crisis

imf-building-2The International Monetary Fund (IMF) has recently published a comprehensive report called “Global Financial Stability Report – Responding to the Financial Crisis and Measuring the Systemic Risk.”. The IMF paper covers the history of the recent global financial crisis, as well as the measures taken by the governments and the companies to fight against it.

The report analyzes why the financial institutions have all been hit so hard by the current financial crisis, from the pension funds to the life insurance companies. These institutions were impacted despite the fact that most of them took preventive measures to manage potential surges in the risks of their assets. The report also underlines that there is a strong retrenchment from foreign markets, which outpaces strongly the overall de-leveraging process. The sharp decline of the cross border funding actuall created the crisis in the emerging markets, whilst the re-financing needs of those markets are still very large (estimated by the IMF at $1.8 trillion in 2009). Read more

Weekly Update On Our Doitinvest Investment Portfolio no.1 – U.S. Blue Chip Stocks (3)

As we have adopted fundamentally long positions in our US blue chip shares portfolio, there are no changes in the no of shares owned as of today. However, the market seemed to come back a little bit this week and we extended our gains modestly (but certainly, as $8,000 is no little gain I’d say -0.8% per week measn 40% in one year, an investment yield hard to obtain otherwise than by doing a lot of short selling these days).

So the summary of our US portfolio looks as follows: Read more

US Mortgages to Be Further Subsidized by the Government

mortgagesThe US Treasury Department is considering giving banks and investors billions of dollars in fresh incentives to modify troubled mortgages and save homeowners from foreclosure, sources familiar with official deliberations said.

Under one scenario, investors in second liens would receive a cash payment if they agree to ease the terms of troubled loans and accept a smaller return on their mortgage investment, the sources said. Read more

Freddie Mac acting CFO in apparent suicide

WASHINGTON (Reuters) – David Kellermann, the chief financial officer of mortgage giant Freddie Mac, was found dead in his Virginia home on Wednesday, an apparent suicide, police said and CNN said..

Kellermann, 41, was discovered before dawn in his suburban Washington home in Fairfax County, Virginia, police said. They did not confirm the exact cause of death but CNN said it had confirmed he had committed suicide.

Should this be linked to the neverending financial troubles of the famous mortgages company?!

Update On Our Doitinvest Investment Portfolio no.1 – U.S. Blue Chip Stocks

djia-april-2009-14th-overall-us-market-evolutionWell, two weeks have passed since we started our blue chip shares portfolio. If you remember, we created a portfolio of very liquid shares two weeks ago, with the intention of tracking its performance and of comparing it with the investments performance of the DJIA index.

Well, in two weeks the things are quite good. The initial value of our investments portfolio was $1,06 million. In these 13 days we had no bad luck – in fact we had capital gains (since we did not made any transactions with the shares) of $60,000. This corresponds to an investment yield of 6% before any trading commissions and taxes, or roughly to 4% after those. Read more

How Long Will the Financial Crisis Still Last? (3)

recession-street-how-do-the-shops-close-downHere we go again with one more doitinvest.com survey on how long might still last the current financial crisis / recession. Compared to the last two surveys we had a couple of months ago, this one seems to be pretty more optimistic. This optimism is fueled by the recent slow recovery of the stock markets (see the Dow Jones recovering sharply in the last two weeks), as well as by the pace of the bad news pouring in at a slower pace.
The financial investing experts surveyed by doitinvest.com point out at four main causes of their optimism: Read more