{"id":11110,"date":"2010-06-07T20:12:08","date_gmt":"2010-06-08T00:12:08","guid":{"rendered":"http:\/\/www.prefblog.com\/?p=11110"},"modified":"2010-06-07T20:12:08","modified_gmt":"2010-06-08T00:12:08","slug":"june-7-2010","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=11110","title":{"rendered":"June 7, 2010"},"content":{"rendered":"

There’s some hasty back-pedalling in Hungary<\/a>:<\/p>\n

\u201cAny comparison with countries that have much higher credit default swap ratings than Hungary is unfortunate,\u201d State Secretary Mihaly Varga told reporters today in Budapest. \u201cThe comments that have been made about this issue are exaggerated and if they come from colleagues that\u2019s unfortunate.\u201d
…<\/b>
Prime Minister Viktor Orban, who took power a week ago, sought permission for a wider budget deficit from the European Union and the International Monetary Fund, which led the 20 billion-euro ($24 billion) bailout for Hungary. European Commission President Jose Manuel Barroso this week rebuffed Orban, urging him to continue fiscal consolidation.<\/p>\n

The government will aim to meet the deficit target of 3.8 percent of gross domestic product, which is \u201cattainable\u201d through changes to spending and revenue plans, Varga said today. Orban called a three-day emergency cabinet meeting to hammer out the action plan.<\/p><\/blockquote>\n

Kenneth A. Posner writes an interesting piece on Contingent Capital<\/a>:<\/p>\n

This idea has in fact been around for some time: in 1991, Tom Stanton suggested contingent capital for Fannie Mae and Freddie Mac (FRE, Fortune 500) — if people had listened then, the idea would have saved taxpayers untold billions today — the government’s bailout of the two mortgage agencies is unlimited, with the Congressional Budget Office estimating it could cost $373 billion by 2020.<\/p><\/blockquote>\n

The proposed global bank tax has been rejected<\/a>:<\/p>\n

Group of 20 nations failed to agree on a proposal to impose a global tax on banks that was aimed at making the financial industry shoulder the cost of bailouts, settling instead for a common set of guidelines.<\/p>\n

G-20 finance ministers and central bank governors said in a statement in Busan, South Korea, that governments will take account of each nation\u2019s \u201ccircumstances and options.\u201d The result allows nations such as Canada, China and Brazil, whose banks suffered less during the global financial crisis, to skip introducing a tax. European countries and the U.S. have advocated the levy.<\/p>\n

\u201cIf we\u2019re living in an ideal world, a global financial tax would be a good idea but in reality, it is almost impossible to implement,\u201d said Tomo Kinoshita, an economist at Nomura Holdings Inc. in Hong Kong. \u201cThere are too many obstacles.\u201d<\/p>\n

Yesterday\u2019s statement leaves in place an initiative to seek tighter global standards for capital levels at banks, which is a \u201cmore practical\u201d way to help reduce the risk of financial crises, Kinoshita said. Banks have opposed the effort, warning that the costs may curb credit expansion and economic growth.<\/p><\/blockquote>\n

It is my understanding that the Europeans are opposed to increased capitalization, since a greater proportion of their credit markets consists of bank loans.<\/p>\n

PrefBlog was mentioned in Larry McDonald’s Canadian Business Online Blog<\/i> post Round-up of financial blogs<\/a>. Thanks, Larry!<\/p>\n

The Goldman pogrom continued<\/a>:<\/p>\n

The commission established by Congress to investigate the causes of the financial crisis issued a subpoena to Goldman Sachs on Monday for \u201cfailing to comply with a request for documents and interviews in a timely manner.\u201d
…<\/b>
A person briefed on the investigation said that Goldman had already provided more than 20 million pages of documents, and that the commission had begun interviewing witnesses, on a range of issued, including derivatives, the complex financial instruments that were at the heart of the crisis.<\/p><\/blockquote>\n

Not just 20-million<\/a>!<\/p>\n

Goldman Sachs sent more than a billion pages of documents, FCIC Vice Chairman Bill Thomas said on a conference call with reporters today. Not all of the information is what the panel requested, and Goldman Sachs didn\u2019t cooperate with requests to interview Chief Executive Officer Lloyd Blankfein, Chief Operating Officer Gary Cohn and Chief Financial Officer David Viniar, FCIC Chairman Phil Angelides said.<\/p>\n

\u201cWe did not ask them to pull up a dump truck to our offices and dump a bunch of rubbish,\u201d said Angelides, 56, who previously served as California\u2019s treasurer. \u201cThis has been a very deliberate effort over time to run out the clock.\u201d<\/p><\/blockquote>\n

Bank CDS levels in Europe show a certain amount of nervousness<\/a>:<\/p>\n

The cost of insuring against a default on financial-company bonds surged, with the Markit iTraxx Financial Index of credit- default swaps linked to the senior debt of 25 European banks and insurers climbing 6 basis points to 189, according to CMA DataVision in London, near the highest level since March 2009. The Markit iTraxx SovX Western Europe Index of contracts on 15 governments fell 1.5 basis points to 167, compared with the record-high 174.4 reached on June 4.<\/p><\/blockquote>\n

It is my understanding that the recently issued and poorly received EMA.PR.A<\/a> will be repriced and offered at 24.50.<\/p>\n

It was another very strong day on the Canadian preferred share market, with PerpetualDiscounts up 67bp and FixedResets gaining 15bp. Volume was elevated.<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n
HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices<\/strong>
Values are provisional and are finalized monthly<\/td>\n<\/tr>\n
Index<\/td>\nMean
Current
Yield
(at bid)<\/td>\n		Median
YTW<\/td>\n		Median
Average
Trading
Value<\/td>\n		Median
Mod Dur
(YTW)<\/td>\n		Issues<\/td>\nDay’s Perf.<\/td>\nIndex Value<\/td>\n<\/tr>\n
Ratchet<\/td>\n2.67 %<\/td>\n2.72 %<\/td>\n42,323<\/td>\n20.68<\/td>\n1<\/td>\n0.0000 %<\/td>\n2,093.6<\/td>\n<\/tr>\n
FixedFloater<\/td>\n5.18 %<\/td>\n3.27 %<\/td>\n28,327<\/td>\n19.96<\/td>\n1<\/td>\n0.1908 %<\/td>\n3,090.8<\/td>\n<\/tr>\n
Floater<\/td>\n2.41 %<\/td>\n2.79 %<\/td>\n91,149<\/td>\n20.19<\/td>\n3<\/td>\n0.0734 %<\/td>\n2,240.9<\/td>\n<\/tr>\n
OpRet<\/td>\n4.88 %<\/td>\n3.79 %<\/td>\n95,117<\/td>\n0.95<\/td>\n11<\/td>\n0.2128 %<\/td>\n2,313.4<\/td>\n<\/tr>\n
SplitShare<\/td>\n6.41 %<\/td>\n-0.05 %<\/td>\n102,857<\/td>\n0.08<\/td>\n2<\/td>\n0.5331 %<\/td>\n2,164.4<\/td>\n<\/tr>\n
Interest-Bearing<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.2128 %<\/td>\n2,115.4<\/td>\n<\/tr>\n
Perpetual-Premium<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.6698 %<\/td>\n1,861.0<\/td>\n<\/tr>\n
Perpetual-Discount<\/td>\n6.09 %<\/td>\n6.16 %<\/td>\n205,412<\/td>\n13.70<\/td>\n77<\/td>\n0.6698 %<\/td>\n1,761.6<\/td>\n<\/tr>\n
FixedReset<\/td>\n5.45 %<\/td>\n4.19 %<\/td>\n415,259<\/td>\n3.51<\/td>\n45<\/td>\n0.1536 %<\/td>\n2,166.1<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
Performance Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nChange<\/td>\nNotes<\/td>\n<\/tr>\n
CIU.PR.B<\/td>\nFixedReset<\/td>\n-1.09 %<\/td>\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-07-01
\nMaturity Price : 25.00
\nEvaluated at bid price : 27.30
\nBid-YTW : 4.31 %<\/td>\n<\/tr>\n
TCA.PR.X<\/td>\nPerpetual-Discount<\/td>\n1.05 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 45.45
\nEvaluated at bid price : 47.20
\nBid-YTW : 5.97 %<\/td>\n<\/tr>\n
TD.PR.O<\/td>\nPerpetual-Discount<\/td>\n1.07 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 20.85
\nEvaluated at bid price : 20.85
\nBid-YTW : 5.90 %<\/td>\n<\/tr>\n
POW.PR.B<\/td>\nPerpetual-Discount<\/td>\n1.07 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 21.46
\nEvaluated at bid price : 21.73
\nBid-YTW : 6.25 %<\/td>\n<\/tr>\n
IAG.PR.A<\/td>\nPerpetual-Discount<\/td>\n1.10 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 18.41
\nEvaluated at bid price : 18.41
\nBid-YTW : 6.27 %<\/td>\n<\/tr>\n
NA.PR.K<\/td>\nPerpetual-Discount<\/td>\n1.14 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 23.72
\nEvaluated at bid price : 24.02
\nBid-YTW : 6.15 %<\/td>\n<\/tr>\n
BNS.PR.O<\/td>\nPerpetual-Discount<\/td>\n1.15 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 23.58
\nEvaluated at bid price : 23.78
\nBid-YTW : 5.97 %<\/td>\n<\/tr>\n
TD.PR.R<\/td>\nPerpetual-Discount<\/td>\n1.15 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 23.53
\nEvaluated at bid price : 23.72
\nBid-YTW : 5.98 %<\/td>\n<\/tr>\n
HSB.PR.D<\/td>\nPerpetual-Discount<\/td>\n1.18 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 20.50
\nEvaluated at bid price : 20.50
\nBid-YTW : 6.23 %<\/td>\n<\/tr>\n
PWF.PR.K<\/td>\nPerpetual-Discount<\/td>\n1.21 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 20.04
\nEvaluated at bid price : 20.04
\nBid-YTW : 6.27 %<\/td>\n<\/tr>\n
SLF.PR.B<\/td>\nPerpetual-Discount<\/td>\n1.24 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 19.54
\nEvaluated at bid price : 19.54
\nBid-YTW : 6.16 %<\/td>\n<\/tr>\n
RY.PR.B<\/td>\nPerpetual-Discount<\/td>\n1.25 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 20.27
\nEvaluated at bid price : 20.27
\nBid-YTW : 5.85 %<\/td>\n<\/tr>\n
POW.PR.A<\/td>\nPerpetual-Discount<\/td>\n1.42 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 22.66
\nEvaluated at bid price : 22.90
\nBid-YTW : 6.21 %<\/td>\n<\/tr>\n
PWF.PR.I<\/td>\nPerpetual-Discount<\/td>\n1.54 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 24.09
\nEvaluated at bid price : 24.47
\nBid-YTW : 6.21 %<\/td>\n<\/tr>\n
TD.PR.Q<\/td>\nPerpetual-Discount<\/td>\n1.54 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 23.54
\nEvaluated at bid price : 23.74
\nBid-YTW : 5.98 %<\/td>\n<\/tr>\n
NA.PR.M<\/td>\nPerpetual-Discount<\/td>\n1.64 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 24.63
\nEvaluated at bid price : 24.86
\nBid-YTW : 6.10 %<\/td>\n<\/tr>\n
GWO.PR.M<\/td>\nPerpetual-Discount<\/td>\n1.72 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 23.48
\nEvaluated at bid price : 23.65
\nBid-YTW : 6.14 %<\/td>\n<\/tr>\n
BMO.PR.H<\/td>\nPerpetual-Discount<\/td>\n1.75 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 22.24
\nEvaluated at bid price : 22.66
\nBid-YTW : 5.88 %<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n
Volume Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nShares
Traded<\/td>\n		Notes<\/td>\n<\/tr>\n
SLF.PR.G<\/td>\nFixedReset<\/td>\n62,015<\/td>\nRBC crossed 16,000 at 24.35.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 24.45
\nEvaluated at bid price : 24.50
\nBid-YTW : 4.16 %<\/td>\n<\/tr>\n
IAG.PR.E<\/td>\nPerpetual-Discount<\/td>\n56,100<\/td>\nDesjardins crossed 19,800 at 24.14; TD crossed 17,700 at the ame price; TD sold 17,700 to Desjardins at the same price again.
\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 23.88
\nEvaluated at bid price : 24.07
\nBid-YTW : 6.24 %<\/td>\n<\/tr>\n
BNA.PR.C<\/td>\nSplitShare<\/td>\n55,000<\/td>\nRBC crossed 50,000 at 19.10.
\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2019-01-10
\nMaturity Price : 25.00
\nEvaluated at bid price : 19.11
\nBid-YTW : 8.28 %<\/td>\n<\/tr>\n
TD.PR.G<\/td>\nFixedReset<\/td>\n41,030<\/td>\nTD crossed 25,000 at 27.15.
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2014-05-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 27.10
\nBid-YTW : 4.19 %<\/td>\n<\/tr>\n
TD.PR.S<\/td>\nFixedReset<\/td>\n39,673<\/td>\nTD crossed 24,000 at 25.70.
\nYTW SCENARIO
\nMaturity Type : Call
\nMaturity Date\t: 2018-08-30
\nMaturity Price : 25.00
\nEvaluated at bid price : 25.69
\nBid-YTW : 4.21 %<\/td>\n<\/tr>\n
CM.PR.I<\/td>\nPerpetual-Discount<\/td>\n31,000<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2040-06-07
\nMaturity Price : 19.35
\nEvaluated at bid price : 19.35
\nBid-YTW : 6.17 %<\/td>\n<\/tr>\n
There were 41 other index-included issues trading in excess of 10,000 shares.<\/td>\n<\/tr>\n<\/table>\n","protected":false},"excerpt":{"rendered":"

There’s some hasty back-pedalling in Hungary: \u201cAny comparison with countries that have much higher credit default swap ratings than Hungary is unfortunate,\u201d State Secretary Mihaly Varga told reporters today in Budapest. \u201cThe comments that have …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[],"class_list":["post-11110","post","type-post","status-publish","format-standard","hentry","category-market-action"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/11110","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=11110"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/11110\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=11110"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=11110"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=11110"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}