Govt urged to follow in Pridi's footsteps

A peaceful approach in problem-solving and the democratic principles
observed by the late statesman Pridi Banomyong should be adopted by the
country in carrying out the charter changes, academics said yesterday.

Speaking at a commemoration service to mark the 110th anniversary of the
statesman's death, Anusorn Thamjai, member of the organising committee,
encouraged the public to follow the path of the former premier.

"It is time for Thailand to praise a civilian like Prof Dr Pridi, who
sacrificed for the public and should be seen as a role model by Thais.

"We should shun away from political divide, and follow the path of this
honest and brave leader," he said.

Mr Pridi was the founder of Thammasat University, leader of the Free
Thai Movement which fought for the country's freedom during World War II.

In 1947, the government under the late prime minister Luang Adm
Thamrongnawasawat was toppled by a coup led by Lt-Gen Phin Choonhavan.
Mr Pridi escaped arrest by fleeing the country during the military takeover.

He spent the rest of his life in exile in Singapore, China and France,
where he died on May 12 in a Paris suburb in 1983 at the age of 95.

The commemoration began yesterday and will run for a period of one year.

Mr Anusorn said the year-long commemoration will serve as a channel to
bridge the social divide by using Mr Pridi's principle.

The late statesman's peaceful approach to political problems and
democratic thinking would give the Thai people and politicians an idea
on how to solve the ongoing political problems.

The messages conveyed in the commemoration range from democratic ideals
to social ethics, with the targets being politicians as well as the
general public, he said.

"Vietnam has Uncle Ho to spark patriotism among the people. It is time
Thailand also praised Mr Pridi in a similar way," Mr Anusorn said.Source
- Bangkok Post

Stocks mixed after Bear Stearns deal

          NEW YORK (AP) - Wall Street ended a temperamental session widely mixed Monday after investors grappled with JPMorgan Chase & Co.'s government-backed buyout of the stricken investment bank Bear Stearns Cos.
          The Dow Jones industrials recovered from an initial drop of nearly 200 points to finish up about 21 points. The broader Standard & Poor's 500 and Nasdaq composite indexes ended lower as investors bailed out of investment banks and small-cap stocks and fled instead to large companies apt to be reliable during a weak economy.
          "You move to the defensive names in times of market uncertainty -- safer, consumer names," said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research.
          The buyout of Bear Stearns was certainly more appealing than the alternative: letting the investment bank collapse and causing huge losses for anyone linked to it. And some unprecedented moves by the Federal Reserve gave investors a bit of solace on what many predicted would be a day of precipitous losses in the stock market.
          Besides supporting the buyout, the Fed lowered the rate it charges to loan directly to banks by a quarter-point on Sunday night -- two days before its scheduled meeting Tuesday. The central bank also set up a lending option for firms, including many non-bank financial services firms, to secure short-term loans for a broad range of collateral.
          The Fed appears to be pledging to do everything in its power to keep the credit crisis from decimating the financial industry and the economy. Policy makers at the central bank are expected to reduce the target fed funds rate -- the rate banks charge each other for overnight loans -- by at least a half-point on Tuesday, and perhaps even a full point.
          But the market remained extremely volatile. The sale of Bear Stearns -- at a minuscule $2.21 a share as of Monday's close, or a total of $260.5 million -- stirred fear among investors worldwide about other banks' exposure to the troubled credit markets.
          "You're going to have some very weak players pushed out of business," said Joseph V. Battipaglia, chief investment officer at Ryan Beck & Co. He said JPMorgan's buy of Bear Stearns and Bank of America Corp.'s acquisition of mortgage lender Countrywide Financial Corp. are probably not the only rescues the industry will witness during this credit crisis.
          The Dow rose 21.16, or 0.18 percent, at 11,972.25, after falling nearly 200 and rising more than 100. The blue chip index was supported partially by JPMorgan, by far the biggest gainer among the 30 component stocks. JPMorgan rose $3.77, or 10.3 percent, to $40.31.
          The Standard & Poor's 500 index fell 11.54, or 0.90 percent, to 1,276.60. The Nasdaq composite index, heavily populated by small and high-tech companies, fell 35.48, or 1.60 percent, to 2,177.01. The Russell 2000 index of smaller companies fell 12.42, or 1.87 percent, to 650.48.
          Declining issues outnumbered advancers by about 5 to 1 on the New York Stock Exchange. Consolidated volume came to 5.69 billion shares, up from 5.18 billion Friday.
          Bond prices rose. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.30 percent from 3.44 percent late Friday.
          "The market has absolutely no idea what's going on," said Dan Alpert, managing director of Westwood Capital. "Some people have accused them of whistling past the graveyard -- I don't think they even know where the graveyard is."
          He added that short-covering -- the unwinding of bets that stocks will fall -- ahead of Tuesday's Fed meeting contributed to the market's atypical movements.
          The Dow got a lift as investors aimed for large-cap stocks such as AT&T Inc., up 76 cents at $35.79, Verizon, up 79 cents at $34.61, and pharmaceutical maker Johnson & Johnson, up $1.39 at $64.04.
          But the pain for stockholders in Bear Stearns, which succumbed to losing bets on souring mortgages for borrowers with poor credit, will be sizable. JPMorgan is buying Bear, including its midtown Manhattan headquarters, for about 1 percent of the investment bank's worth little more than two weeks ago. Bear Stearns' buyout arrives after a short-term bailout Friday organized by the Fed and involving JPMorgan.
          Bear Stearns shares fell 86 percent to $4.10 -- still above the buyout price, implying that some shareholders believe the deal terms might change.
          Some investors worry Lehman Brothers Holdings Inc. might be next to fall. Lehman -- the investment bank considered most similar to Bear Stearns -- and other major investment banks are slated this week to report quarterly results.
          DBS Group Holdings Ltd., Southeast Asia's largest bank, reportedly instructed traders in an e-mail early Monday not to do business with the bank. According to Dow Jones Newswires, DBS Group later told traders to disregard the earlier e-mail. Lehman denied there were any problems with DBS.
          Lehman fell $7.51, or 19 percent, to $31.75.
          While investors focused on the financial sector, fresh economic news offered little solace. The Fed said output at the country's factories, mines and utilities fell by 0.5 percent in February, the biggest decline last October. Many analysts had been expecting a slight increase of one-tenth of one percent.
          The Commerce Department also said Monday the current account deficit, the broadest measure of foreign trade, fell slightly in 2007 as stronger growth in U.S. exports offset a spiking foreign oil bill.
          The dollar sank to a record low against the euro and hit a 12 1/2 year low against the Japanese yen, while gold prices rose to another record high. Crude oil plunged from record levels by $4.53 to settle at $105.68 per barrel on the New York Mercantile Exchange.

 

Source - Xinhua

 

OUTLOOK Credit Agricole Q1 net to plunge; concerns over corporate banking ops

          PARIS (Thomson Financial) - Credit Agricole will report a year-on-year plunge in its first-quarter net profit on Thursday, amid major writeoffs and ongoing concerns about activity in its corporate and investment banking (CIB) business, analysts said.
          According to a Thomson Financial poll, analysts are predicting, on average, a net profit of 1.280 billion euros, which is less than half of the 2.655 billion euros made the same time last year.
          Analysts at Keefe, Bruyette and Woods projected 1.487 billion euros in writeoffs in the first quarter. They said there is residual net exposure to collateralized debt obligations (CDOs), for which writeoffs will be around 411 million euros.
          They also called visibility for the CIB operation "limited" because there is still potential for further markdowns and higher regulatory capital requirements for investment banking operations.
          The Keefe, Bruyette analysts see Credit Agricole, which reports its results before the market opens, posting a net profit of 1.026 billion euros, with operating profit at 907 million.
          Analysts at Deutsche Bank, also focusing on the CIB business, said Credit Agricole will not benefit from one-off items such as debt revaluation, and does not have the interest rate derivatives business that BNP Paribas has to compensate for declines elsewhere in capital markets.
          However, they said the CIB's financing activities should make a positive contribution.
          The Deutsche Bank analysts expect a net profit of 1.441 billion euros, with an operating profit of 2.077 billion. They predict markdowns of about 750 million euros from its monoline insurance exposure.

 

Source - Xinhua

Wall Street looks to US consumers for direction

          NEW YORK (AP) - With millions of stimulus checks going out to taxpayers, Wall Street wants to know where that money will be spent -- and this week's data could help investors gauge the mind-set of the average consumer.
          Tax rebates have historically been helpful in boosting the economy, but they only really work if they're used to buy goods and services. With many consumers weighed down by debt and saving up to keep up with the cost of basic necessities, some market experts are concerned that what's best for most individuals -- saving their rebates -- might not end up helping the broader economy.
          Whether the average consumer feels financially healthy could determine whether the economy gets that late-2008 lift that so many investors have been betting on.
          On Tuesday, the Commerce Department reports on retail sales in April. Economists surveyed by Thomson Financial/IFR estimated, on average, that sales dipped by 0.1 percent last month after growing by 0.2 percent in March.
          Also this week, several big retailers -- Wal-Mart Stores Inc., Macy's Inc., JCPenney Co. and Kohl's Corp. -- release their first-quarter results, along with outlooks for later in the year.
          After seeing last week's batch of mixed April sales figures from individual retailers, Wall Street knows that spending remains weak, but investors want more information. Retailers have made clear that consumers are changing their spending habits to accommodate the rising cost of energy and food, but no one knows how long these conditions will last.
          Investors will learn more about the inflation consumers face when the Labor Department releases its consumer price index Wednesday. The index is expected to have risen by 0.3 percent in April after increasing by a similar amount in March. Core consumer prices, which strip out food and energy, are expected to have climbed by 0.2 percent after rising at the same pace the previous month.
          Last week was a downbeat one in the stock market, with the major indexes retrenching following three straight weeks of gains as a few poor earnings results and surging oil prices weighed on investors. The Dow Jones industrial average sank 2.39 percent, the Standard & Poor's dropped 1.81 percent, and the Nasdaq composite index slid 1.27 percent.
          Crude oil soared by about $10 last week to settle near $126 a barrel, yet another all-time high. Meanwhile, the average roadside price for a gallon of gasoline jumped above $3.67.
          Market experts are split over whether oil prices will remain at these levels, surge higher, or collapse, so stock traders will continue to monitor the energy markets closely.
          In other economic data this week, on Thursday, the National Association of Home Builders releases its May index and the Philadelphia and New York Federal Reserves report on their regions' manufacturing activity. On Friday, the Commerce Department reports on housing starts in April and the University of Michigan releases its consumer sentiment index.

 

Source - Xinhua Finance

Investing a nation's wealth for the future

          Sovereign wealth funds are pools of government money invested for different purposes.

 

          The investment objectives include savings for future generations, smoothing income streams or simply achieving higher returns on the country's reserve holdings.

 

          Sovereign wealth funds (SWFs) are funded by the government's foreign-currency reserves or fiscal surpluses and are managed separately from official international reserves.

 

          At present, there are about 50 SWFs in global markets. Their total size has been estimated at about US$2 trillion (Bt63.8 trillion) to $3 trillion, about double the size of hedge funds around the world.

 

          Broadly, the sources of an SWF are a country's external reserves from its current-account surpluses from commodity and non-commodity exports, or its capital-account surplus following large net capital inflows. In terms of sustainability, the surplus from commodity exports is relatively predictable, long-lasting and regarded as genuine financial wealth. It can therefore be invested in assets with higher returns and greater risks.

 

          In contrast, the current-account surplus from non-commodity exports tends to be more volatile.

 

          Meanwhile, the wealth accumulated from large capital inflows is the least dependable as this could easily reverse, especially short-term inflows. Hence these two types of wealth may be thought of more as "borrowed wealth" and should not be invested in risky assets.

 

          Thus, the investment returns from borrowed wealth would tend to be lower than initially expected.

 

          While carving out part of a country's international reserves and investing it in more diversified asset classes other than foreign government bonds and debt papers is one plausible way to enhance returns, higher risks are also involved.

 

          Importantly, if the objective of establishing an SWF involves the country's strategic investment, it is necessary that such an SWF allows that country to meet future economic and social needs through investment in strategic assets.

 

          What kinds of foreign assets deserve to be another country's strategic assets?

 

          Should it be energy, telecommunications, transport or something else?

 

          Indeed, reflecting on the proliferation and some high-profile investments in the midst of financial turbulence in global markets, the growing role of SWFs has attracted a wide range of criticism on governance, transparency and possibly hidden political agendas underlying investment decisions, which in turn might trigger negative reactions from investment recipient countries.

 

          For any country, establishing an SWF will naturally require a thorough study of the readiness of that country in terms of sources of wealth, financing adequacy, as well as the identification of justified invest-

 

          ment objectives and capacity to make efficient overseas investments.

 

          While these are some of the initial considerations, key detailed practical considerations are the legal infrastructure and the observance of international best practices regarding SWFs.

 

          Indeed, current issues of intense debate on SWFs include the institutional arrangement, organisational structure and the legal process governing reserves and public-debt management that the country needs to revisit extremely carefully to ensure the safeguarding of its financial stability over the long term.

Source - The Nation

 

Five Tips To Raise Your Credit Score

You benefit by having a good credit score. Lenders give you lower interest rates on mortgages, car loans and other financial products. Any time your credit score falls below 620, it becomes difficult for you to get loans with reasonable terms. In such a case, you need to undertake credit repair to improve your credit rating. There are simple ways by which you can raise your credit scores and undertake credit repair. Let us have a look at them:

*Check your credit report - Ensure that you regularly get your credit report. If you notice any irregularity or discrepancy in the credit report, immediately report to the credit bureau to have it corrected. Once corrected, it will raise your credit score. Ensure that your credit report comes from one of the three major credit bureaus: Experian, Trans Union or Equifax.
*Pay bills on time - Ensure that you pay your bills on time. 35% of your credit score is dependent on your payment history. The current or recent payment history has more weight than that of three years ago. Remember, missing one payment affects your credit score by 50 to 100 points. Timely payments are the best way to rebuild and raise your credit score.
*Pay down your debts - Your outstanding balance on your credit card is reported once a month to the credit bureaus. To them, it does not matter if you pay or carry your balance forward every month. Credit bureaus, generally, do not bother whether you are carrying balance on your cards or not. What matters is that there is a lot of gap between the amounts of debt you carry and your credit limit. The more wide the gap, the better your credit score. The less you charge on your card, the more it will raise your credit score.
*Do not close old accounts - Most people close old accounts they are not using. This used to make sense, but with today's system of scoring, this actually hurts your credit score. Closing these older accounts, in effect, lowers the total credit available to you and this causes the balances you have, to appear larger when calculating credit scores. Closing of old accounts also shortens your credit history, making you appear less creditworthy.

When faced with a case of Identity Theft, you would tend to close your old or paid off accounts. This may lower your score minimally, but by not closing your old accounts, you raise your credit score.
*Avoid bankruptcy - This is a sure shot way to destroy your credit score, as much as by 200 points. A bankruptcy gets reported up to 10 years. Avoid bankruptcy at all costs.

Credit repair is necessary for not only getting loans and credits but also to get them at a good rate. You need to keep your outstanding debts at bare minimum and pay your dues on time to enjoy a healthy credit rating.

Credit Scores - Affecting Your Credibility

Today, we buy mostly everything on credit. We need credit, especially, to buy a house or a car. When applying for a loan, our good credit scores help us get it at reasonable interest rates. In fact, from landlords, to insurance companies, to utilities, everyone looks at your credit scores, as they are a reflection of your financial health. A healthy credit score goes to determine what various people will charge you for their services. Today, even employers check your personal credit scores before offering you a job. A good credit score further helps you in getting additional credit. You would need to undertake credit repair if your credit score falls below a particular level.

Before we get an understanding of the factors affecting your credit scores, let us understand who maintains your credit reports and how they do it.

The Credit Bureaus
Three major credit bureaus - Equifax, Experian, and TransUnion - calculate your credit scores. Though they use the same methods and formula to calculate your scores, they sometimes come up with a different rating. This could be because of various reasons. One agency may have more updated information about you. A creditor may have shared information about you with one agency only, but not with the others. Creditors, while checking on your scores, take the average of the three scores from these three agencies.

Your credit scores range between 350 and 850. A score of 680 and above is excellent for obtaining mortgage financing at low interest rates. A credit score of 621 to 679 is an average score and you would have to pay a slightly higher rate of interest. A credit score of below 600 makes you potentially unreliable and very difficult for you to obtain credit of any kind. If your credit score falls below 600, you need to undertake steps to repair your credit on an immediate basis.

Factors that Affect Your Credit Scores

There are several factors that could negatively affect your credit scores. There are ways to prevent these factors from affecting your scores.

*Check on your history of making debt payments and the amount of debt you presently carry.
*The length of your credit history is another factor. The longer your good credit history, the better it is for you.
*Do not close old or paid off accounts. These show the length of your credit history and contribute to higher credit scores.
*Paying off your debts is a good way to improve your credit scores.
*Make your payments on time. Delayed payments appear on your credit reports and adversely affect it.
*Your race, sex, age, level of education, or marital status has no bearing on your credit scores and neither does the fact that your application for credit has been turned down.

Take care to maintain a high credit rating and get credit and loans at good rates. You have the option to undertake credit repair to improve your credit score but maintaining a healthy credit rating is a better option because prevention is always better than cure.