Saturday, 28 June 2008


Barclays warns of a financial storm as Federal Reserve's credibility crumbles

Last Updated: 12:01am BST 28/06/2008

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US central bank accused of unleashing an inflation shock that will rock financial markets, reports Ambrose Evans-Pritchard

Barclays Capital has advised clients to batten down the hatches for a worldwide financial storm, warning that the US Federal Reserve has allowed the inflation genie out of the bottle and let its credibility fall "below zero".

"We're in a nasty environment," said Tim Bond, the bank's chief equity strategist. "There is an inflation shock underway. This is going to be very negative for financial assets. We are going into tortoise mood and are retreating into our shell. Investors will do well if they can preserve their wealth."

Barclays Capital said in its closely-watched Global Outlook that US headline inflation would hit 5.5pc by August and the Fed will have to raise interest rates six times by the end of next year to prevent a wage-spiral. If it hesitates, the bond markets will take matters into their own hands. "This is the first test for central banks in 30 years and they have fluffed it. They have zero credibility, and the Fed is negative if that's possible. It has lost all credibility," said Mr Bond.

Federal Reserve chairman Ben Bernanke has made a huge policy mistake, according to Barclays
Strategists at Barclays accuse Ben Bernanke of a policy blunder
  • RBS issues global crash alert
  • Read more by Ambrose Evans Pritchard
  • The grim verdict on Ben Bernanke's Fed was underscored by the markets yesterday as the dollar fell against the euro following the bank's dovish policy statement on Wednesday.

    Traders said the Fed seemed to be rowing back from rate rises. The effect was to propel oil to $138 a barrel, confirming its role as a sort of "anti-dollar" and as a market reproach to Washington's easy-money policies.

    The Fed's stimulus is being transmitted to the 45-odd countries linked to the dollar around world. The result is surging commodity prices. Global inflation has jumped from 3.2pc to 5pc over the last year.

    Mr Bond said the emerging world is now on the cusp of a serious crisis. "Inflation is out of control in Asia. Vietnam has already blown up. The policy response is to shoot the messenger, like the developed central banks in the late 1960s and 1970s," he said.

    "They will have to slam on the brakes. There is going to be a deep global recession over the next three years as policy-makers try to get inflation back in the box."

    Barclays Capital recommends outright "short" positions on Asian bonds, warning that yields could jump 200 to 300 basis points. The currencies of trade-deficit states like India should be sold. The US yield curve is likely to "steepen" with a vengeance, causing a bloodbath for bond holders.

    David Woo, the bank's currency chief, said the Fed's policy of benign neglect towards the dollar had been stymied by oil, which is now eating deep into the country's standard of living. "The world has changed all of a sudden. The market is going to push the Fed into a tightening stance," he said.

  • Gazprom chief expects 'radical' change in oil price
  • More comment and analysis from The Telegraph
  • The bank said the full damage from the global banking crisis would take another year to unfold.

    Rob McAdie, Barclays' credit strategist, said: "The core issues have not been addressed. We're still in a very large deleveraging cycle and we're seeing losses continue to mount. We think smaller banks will struggle to raise capital. We're very bearish - in the long-term - on high-yield debt. The default rate will reach 8pc to 9pc next year."

    He said investors had taken their eye off the slow-motion disaster engulfing the US bond insurers or "monolines". Together these firms guarantee $170bn of structured credit and $1,000bn of US municipal bonds.

    The two leaders - MBIA and Ambac - have already been downgraded as the rating agencies belatedly turn stringent. The risk is further downgrades could set off a fresh wave of bank troubles. "The creditworthiness of many US financial institutions will decline in coming months," he said.

    The bank warned that engineering and auto firms we're likely to face a crunch as steel and oil costs surge. "Their business models will have to be substantially altered if they are going to survive," said Mr McAdie.

    A small chorus of City bankers dissent from the view that inflation is the chief danger in the US and other rich OECD countries. The teams at Société Générale, Dresdner Kleinwort, and Banque AIG all warn that deflation may loom as housing markets crumble under record levels of household debt.


    Friday, 27 June 2008


    Nestlé hit by Societe Generale's 'Buy' to 'Sell' downgrade and 150 bottles of US water.

    June 27 (Bloomberg)... Nestle SA declined 1.8 percent to 458 francs. Societe Generale SA cut its recommendation on shares of the world's largest foodmaker to ``sell'' from ``buy,'' saying the market has not priced in ``weak'' earnings-per-share growth.




    (The following is a reformatted version of a press release issued by Nestlé Pure Life and obtained via

    Recall of Nestlé Pure Life Purified Water

    FOR IMMEDIATE RELEASE -- (GREENWICH, Connecticut, June 24, 2008) - This announces a product recall for the one-gallon Nestlé Pure Life Purified Drinking Water sold ONLY in Shop-Rite stores in the five Northeast states of Connecticut, Delaware, New Jersey, New York and Pennsylvania. This affects ONLY the one-gallon size.

    Fewer than 150 one-gallon bottles of Nestlé Pure Life Purified Water are implicated, produced in a short timeframe on May 5, 2008 between 8:00 AM and 9:00 AM. The product date code is printed on the shoulder of one-gallon bottles. The code is:

    First line????050508126WF024 Second line??... Starts with the numbers "08" For example: 0801BB05/2010

    The product in question may contain a diluted form of a common food grade cleaning compound that results in a bitter or sour taste. This could pose a potential health concern if ingested in large quantities over an extended period of time and should not be consumed or used in preparing infant formulas or other foods or beverages. No illnesses have been reported.

    To further assure consumers, Shop-Rite, as of Monday, June 23rd, has removed any remaining affected product from their stores and warehouses.

    Consumers who possess this product or have questions should contact the company at a toll free number 866-599-8980 available 24 hours a day. This same toll-free number is also printed on the front of all product labels for the one-gallon size.

    Contact: Nestlé Pure Life 866-599-8980

    (bjh) NY


    Last Updated: June 25, 2008 09:18 EDT



    Empresa investe R$ 50 milhÕes para triplicar a capacidade produtiva da unidade de Feira de Santana

    Salvador, 20 de junho de 2008 - A Nestlé Brasil vai investir R$ 50 milhÕes para triplicar a capacidade produtiva de sua unidade fabril de Feira de Santana, município localizado a 110 quilômetros de Salvador. Inaugurada em 2007, a capacidade de produção passará das atuais 40 mil toneladas/ano para 120 mil toneladas/ano. Cinco novas linhas de fabricação vão integrar o projeto, incluindo os produtos cereais matinais, lácteos (duas linhas), bebidas achocolatadas e iogurtes. A fábrica já processa massas instantâneas, cereais e café solúvel.

    Cerca de 1.000 novos postos de trabalho diretos e indiretos serão gerados nesta nova etapa e o empreendimento ocupará 80 mil m2 de área construída no total, das quais 14 mil m2 devem-se à expansão.

    "A ampliação dos negócios em nossa unidade de Feira de Santana ocorre apenas um ano e quatro meses depois da inauguração da fábrica. O compromisso que assumimos na ocasião foi antecipado em função da velocidade da expansão do nosso projeto de regionalização", afirma Ivan F. Zurita, presidente da Nestlé Brasil.

    A cidade de Feira de Santana situa-se em um importante pólo industrial da região e está estrategicamente localizada, o que contribui para reduzir custos - sobretudo logísticos - e fazer com que os produtos Nestlé tenham preços mais competitivos e acessíveis à população da região.

    A fábrica de Feira de Santana atende ao aumento da demanda do mercado nordestino por produtos da Nestlé. Esse crescimento é reflexo do investimento que a empresa vem realizando com o objetivo de ampliar sua presença no Nordeste desde 2004.


    O Projeto de Regionalização da Nestlé no Norte/Nordeste começou em 2003, após a realização de detalhadas pesquisas de mercado na região para entender melhor os hábitos de consumo e a cultura dos 50 milhÕes de consumidores localizados nesta região.

    Em 2004, a Nestlé criou a diretoria regional Norte/Nordeste com o desafio de criar um modelo de negócios e de comunicação que atendesse às necessidades desses consumidores. Nos últimos três anos, a empresa investiu R$ 30 milhÕes em marketing somente nas regiÕes Norte e Nordeste. A nova estrutura permitiu à Nestlé desenvolver produtos e açÕes de marketing voltadas para o público local. A Nestlé tem por objetivo atender às demandas específicas de cada grupo de consumidores espalhados pelo Brasil. "A empresa não acredita em 'consumidores globais'; cada região tem características muito peculiares e para isso disponibilizamos produtos próprios para os diferentes grupos", afirma Zurita.

    Essa visão é a base do modelo de regionalização que inclui o lançamento de produtos específicos para essas regiÕes. Para atender ao paladar dos mercados do Nordeste, por exemplo, a Nestlé oferece um café solúvel mais suave (NESCAFÉ Dolca) e biscoitos Bono e Negresco em embalagens menores, além do Ideal, produto lácteo enriquecido com Ferro, Cálcio e Vitaminas A, C e D.


    Como forma de contribuir para a melhoria da qualidade de vida das pessoas, a Nestlé busca disseminar seus conceitos de Nutrição, Saúde e Bem-Estar para a população. Pensando nisso, há um ano a Fundação Nestlé Brasil, em parceria com o Instituto Camargo Corrêa, deu início ao Programa Construir para Nutrir, em Feira de Santana (BA). A intenção do trabalho é estimular a alimentação saudável de crianças e adolescentes, por meio de açÕes sócio-educativas, com envolvimento da escola e da família.

    Ao longo deste período, cerca de 30 organizaçÕes sociais da cidade de Feira de Santana foram capacitadas para o desenvolvimento de projetos voltados para a educação alimentar de crianças e adolescentes, promovendo o desenvolvimento comunitário. Dentre as sugestÕes apresentadas, a "Escola na Horta" foi aprovada e está desenvolvendo açÕes sócio-educativas com a implantação de horta escolar e doméstica. O projeto também promove a melhoria dos índices nutricionais, as mudanças de hábitos alimentares e ainda incentiva a inclusão social. A "Escola na Horta" visa ainda proporcionar aos alunos uma oportunidade de aplicar, de forma prática, as liçÕes estudadas em sala de aula, oferecer condiçÕes de uma alimentação saudável e fruto do seu trabalho, e despertar o desejo para mudanças de hábitos alimentares possíveis de serem implementados na família.

    Somente em 2008, cinqüenta escolas públicas participaram do Curso de Formação em Educação Alimentar, realizado pelo Programa Nutrir em parceria com a Secretaria Municipal de Educação e com a Universidade Estadual de Feira de Santana. Ainda neste ano, a meta do programa Construir para Nutrir é capacitar 80% das famílias atendidas; reduzir em 10% o custo da alimentação familiar, com a inclusão dos alimentos produzidos na horta, e a construção de duas sementeiras e dois viveiros.


    A Nestlé é a maior Empresa mundial de nutrição, saúde e bem-estar e opera em 86 países com marcas mundialmente consagradas. No Brasil, instalou a primeira fábrica em 1921, na cidade paulista de Araras, para a produção do leite condensado Milkmaid, que mais tarde seria conhecido como Leite Moça por milhÕes de consumidores.

    A atuação da Nestlé Brasil abrange inúmeros segmentos de mercado, entre os quais alimentos infantis, achocolatados, biscoitos, cafés, cereais, cereais matinais, águas, chocolates, culinários, lácteos, refrigerados, sorvetes, produtos de nutrição clínica e de performance, produtos e serviços para empresas e profissionais da área de alimentação fora do lar (FoodServices) e alimentos para animais de estimação.

    Atualmente, a rede de distribuição dos produtos cobre mais de 1.600 municípios dos mais diversos tamanhos. A Nestlé Brasil e suas empresas coligadas estão presentes em 98% dos lares brasileiros. São 28 unidades industriais localizadas nos Estados de São Paulo (SP), Minas Gerais (MG), Bahia (BA), Goiás (GO), Rio de Janeiro (RJ), Rio Grande do Sul (RS) e Espírito Santo (ES). Emprega 16,7 mil colaboradores diretos e gera outros 220 mil empregos indiretos, que colaboram na fabricação, comercialização e distribuição dos 1.300 itens de 200 marcas­ que vende no País.

    Em todo o Grupo Nestlé, as vendas da Nestlé Brasil ocupam o segundo lugar em volume e o quarto em valor, tendo triplicado nos últimos cinco anos, superando os índices de inflação e do PIB durante esse período.

    RelaçÕes com a Imprensa Nestlé Brasil

    Anahi Guedes / Claudia Galli / Fábio Chaves

    (11) 5508-9395 / (11) 5508-9396 / (11) 5508-9737 / /

    CDN Comunicação Corporativa

    Adriana Perobelli / Lucianne Gellerman

    (11) 3643-2745 / (11) 3643-2841 /




    Last Updated: June 20, 2008 13:38 EDT


    Unilever, Nestle, Ask EU to Reconsider Biofuel Policy (Update1)
    June 20, 2008 13:13 EDT -- Food and drink companies including Unilever and Nestle SA asked the European Commission to review a policy that encourages biofuel production, saying it will help drive agricultural commodity prices to further records.


    Nestle Maintains Sales-Growth Goal for Coming Decade

    By Thomas Mulier

    June 16 (Bloomberg) -- Nestle SA, the world's largest food company, maintained its goal of raising sales by between 5 percent and 6 percent a year over the coming decade as consumers buy more Nescafe instant coffee and other products.

    The forecast excludes currency movements, acquisitions and asset sales. Vevey, Switzerland-based Nestle also expects to improve operating profit as a percentage of sales, or the profit margin, each year, according to slides of a presentation posted today on its Web site.

    Sales will gain 7 percent to 7.5 percent in 2008 on the basis of the 10-year forecast, beating long-range goals for a fourth year, Chairman Peter Brabeck-Letmathe said in April. Nestle's nutrition unit also reiterated its goals today of raising sales by 10 percent a year excluding acquisitions and reporting an operating-profit margin of at least 20 percent.

    Raw-materials prices should show ``stability'' in 2009 compared with this year, Nestle said in a separate presentation. Dairy and cereal prices probably will be lower then than in 2008, though they won't return to last year's levels, the company said.

    Coffee prices are ``unlikely'' to increase further, and the ``large'' 2008 crop may reduce prices, though not ``immediately,'' Nestle also said. Cocoa prices ``remain firm'' as there is little sign supply is growing, while demand remains ``strong'' for oils and fats and sugar prices will stay ``firm,'' Nestle said.

    Packaging Expenses

    ``Sustained high oil prices'' may affect energy, transportation and packaging costs in 2009, the company added.

    Nestle, the maker of Haagen-Dazs ice cream, has built up the nutrition division with the $600 million purchase of weight- loss company Jenny Craig in 2006 and last year's acquisitions of drugmaker Novartis AG's Gerber baby-food unit and its medical- nutrition division, which together cost $12 billion.

    Jenny Craig now boasts a ``mid-double-digit'' operating- profit margin, wider than the prior ``high-single-digit'' level, Nestle said, adding that 2008 had a ``very strong start.''

    The company forecast sales this year of 2 billion Swiss francs ($1.9 billion) from health-care nutrition such as products for cancer patients. Revenue from infant nutrition will come to 8 billion francs, up from 4.8 billion francs in 2006.

    Nestle posted the slides as investors are briefed on strategy at a two-day conference at company headquarters.

    To contact the reporter on this story: Thomas Mulier in Geneva at

    Last Updated: June 16, 2008 11:25 EDT


    Nestle shares undervalued, says Barron's

    Sun May 4, 2008 11:35pm BST

    NEW YORK (Reuters) - Nestle SA (NESN.VX: Quote, Profile, Research) shares look undervalued and could rise 20 percent over the next 12 months, weekly financial Barron's said on Sunday.

    "Arguably, they're the strongest food company in the world," Eric Scher, a Sanford C. Bernstein analyst told Barron's. "Nobody else is growing at everything straight across the board like Nestle."

    Scher argues Nestle shares should be trading about 20 percent higher in a year.

    The report said that, at its recent price of about 490 Swiss francs, the stock was trading about 10 percent below its 52-week high and at a discount to most of its peers on several valuation measures.

    With names such as Butterfinger candy bars, Gerber baby foods, Stouffer's and LeanCuisine frozen meals, JuicyJuice beverages, Nestle has a global stable of blockbuster brands -- 29 of which have annual sales exceeding one billion Swiss francs each, the report said.



    Nestle Expects Sales to Beat Goal on Price Increases (Update8)

    By Thomas Mulier

    March 13 (Bloomberg) -- Nestle SA, the world's largest food company, raised its sales forecast for this year because of price increases and higher shipments of Easter chocolate.

    The shares jumped the most since August. Revenue growth excluding acquisitions, divestments and currency fluctuations should be ``close'' to last year's rate of 7.4 percent, the Vevey, Switzerland-based maker of Nescafe soluble coffee said in an unscheduled announcement today. That would make 2008 the fourth straight year that Nestle beats its long-term growth forecast of 5 percent to 6 percent.

    Nestle's outgoing Chief Executive Officer Peter Brabeck- Letmathe said today Nestle's operating margin will widen this year, and raw material costs will ``abate somewhat'' in the second half. Price rises averaging 3 percent on 10,000 products from chocolate to Purina pet food last year helped blunt the impact of soaring commodity prices and flagging consumer spending. Cocoa has risen 34 percent in 12 months and robusta coffee is up 77 percent.

    ``It's the first time we've seen Nestle make an announcement like that,'' said Claudia Lenz, an analyst at Bank Vontobel with a ``buy'' rating on the stock. ``They want to make a sign that they're becoming more open to financial markets. Brabeck likes to be the star there, and he'll leave the company in the best shape ever.''

    Brabeck will cede the post of CEO to Paul Bulcke, former head of Nestle's business in the Americas, next month.

    Stock Buyback

    Nestle rose 29.5 francs, or 6.2 percent, to 507 in Zurich trading. That was the third-biggest increase in the Dow Jones Stoxx 600 Index of the largest European companies, which slid the most in two weeks today. It's the largest increase in Nestle shares since the company announced a 25 billion-franc share buyback on Aug. 15.

    The Swiss foodmaker's buyback program and last year's decision to scrap its AAA credit rating are signs that Nestle is becoming more receptive to shareholders' concerns, Lenz said. Nestle last month proposed easing limitations on voting rights at its annual general meeting April 10.

    ``The group's organic growth is off to a very strong start in 2008,'' Peter Brabeck-Letmathe, who will step down as chief executive officer next month, said in the statement.

    The new target for 2008 eases investors' concerns that consumers may pare spending due to Nestle's price increases, Marco Gulpers, an analyst at ING Wholesale Banking said. The consensus among analysts was for sales excluding acquisitions, divestments and currencies to increase 5.5 percent this year, Lenz said.

    Biofuel Demand

    Agricultural commodity prices have gained on ``strong'' global demand for food, increased use of crops for biofuels, and the ``decisive presence'' of investors speculating on the markets, Nestle said.

    The maker of KitKat chocolate bars reiterated it expects operating profit as a percentage of sales to gain this year, excluding currency fluctuations. Nestle said Feb. 21 that the margin may widen about 0.3 percentage point this year.

    Nestle is a ``good example'' of a stock that may perform well even if the U.S. economy enters a recession, said Philippe Gijsels, senior equity strategist at Fortis Global Markets, which oversees about $62 billion in Brussels.

    Nestle said it had an ``outstanding organic growth rate'' in January and February, helped by new price increases and a ``successful'' Easter season.

    Revenue excluding price increases accelerated in the first two months, and an additional sales day in February during this leap year also helped, the company said. Price increases will ``trend lower'' in the second half, Nestle also said.

    Swiss Franc

    ``Nestle remains an attractively valued, defensive stock,'' wrote Patrick Hasenboehler, an analyst at Bank Sarasin who has a ``buy'' recommendation on the shares. He said today's announcement was the only unscheduled statement about results he could ever recall the company making.

    The strength of the Swiss franc against other currencies, mainly the dollar, will ``weigh'' on revenue, while the acquisitions of the Gerber baby food brand and Novartis AG's medical nutrition business will boost sales, Nestle said. Those two factors are ``evolving as expected,'' the company added.

    ``If you have strong brands that supermarkets need to bring in the punters, then you have pricing power,'' said Jon Cox, an analyst at Landsbanki Kepler. He rates Nestle ``buy.''

    Separately, Nestle said its nutrition unit, which sells baby food, PowerBars for sport enthusiasts and food for cancer patients, will have sales of about 11 billion francs this year.

    Share Options

    Brabeck was paid 17.4 million francs in salary, bonuses, and stock options last year, according to the company's annual report, released today on Nestle's Web site.

    Before today, shares of Nestle had gained 1.5 percent in the past 12 months, while Kraft Foods Inc. stock is little changed over that period. Groupe Danone SA, the French yogurt maker and bottler of Evian water, has dropped 8.2 percent.

    Nestle's target for this year beats those of Kraft and Unilever NV, though not Danone, which aims for annual sales growth excluding acquisitions and currencies of 8 percent to 10 percent. Kraft has said it aims for ``organic'' sales growth of at least 4 percent this year. Unilever has said it expects underlying sales growth at the upper end of a range of 3 percent to 5 percent.

    To contact the reporter on this story: Thomas Mulier in Geneva at

    Last Updated: March 13, 2008 12:33 EDT

    The eternal present tense

    Tarif Khalidi's new English edition of Islam's sacred book offers valuable perspectives, says Ziauddin Sardar

    Saturday June 21, 2008
    The Guardian

    The Qur'an: A New Translation by Tarif Khalidi
    Buy The Qur'an: A New Translation at the Guardian bookshop
    The Qur'an: A New Translation
    by Tarif Khalidi
    530pp, Penguin Classics, £25

    We look for two things in any new translation of the Qur'an. How close does it get to communicating the meaning of the original, that inimitable oral text, the very sounds of which move men and women to tears and ecstasy? And does it offer something more: a new perspective, perhaps; or an innovative rendering?

    Tarif Khalidi, a professor of Islamic studies at the American University of Beirut, scores high on both these criteria. He manages to capture the allusiveness of the text, as well as something of its tone and texture. While being faithful to the original, he succeeds in conveying linguistic shifts, from narrative to mnemonic, sermons to parables. And there is an innovative component: it is the first translation that tries to capture both the rhythms and the structure of the Qur'an.

    The best way to demonstrate its newness, and how close it is to the original text, is to compare it with an old translation. The translation I have in mind is Khalidi's predecessor in the Penguin Classics: The Koran, translated with notes by NJ Dawood. First published in 1956, Dawood's translation has been republished in numerous editions. It has been a great source of discomfort for Muslims, who see in it deliberate distortions that give the Qur'an violent and sexist overtones. It is the one most non-Muslims cite when they tell me with great conviction what the Qur'an says.

    The change can be detected with the name of the sacred text itself: we move from "Koran", the older anglicised form, to the new "Qur'an", which is now accepted as the correct Arabic transliteration and pronunciation of the word. This is not just a trivial matter of linguistics; it signals a shift from the old Orientalist way of presenting the Qur'an in English to a new inclusive way that takes Muslims' appreciation of their sacred text into account.

    Subtle differences in chapter headings signal significant change. The opening chapter of the Qur'an in Dawood is "The Exordium". In Khalidi, and indeed universally among other translations, it is "The Opening". Dawood translates Az-Zumar (chapter 39) as "The Hordes", suggesting bands of barbarian mobs; Khalidi renders it as "The Groups".

    While Dawood's translation presents the Qur'an as a patriarchal, sexist text, Khalidi brings out the gender-neutral language of the original. A good example is provided by 2:21. In Dawood we read: "Men, serve your Lord." In Khalidi, it becomes: "O People! Worship your Lord." Dawood's translation of the famous verse 2:25, frequently quoted, is largely responsible for the current misconception that Muslim paradise is full of "virgins" - despite the fact that the Qur'an explicitly denies any carnal pleasures in paradise. This is because we find "men" in Dawood's translation in the garden of paradise who are "wedded to chaste virgins". Khalidi renders it correctly: "In these gardens they have immaculate spouses."

    The old Penguin translation uses rather obscurantist images throughout to give the impression that the Qur'an is full of demons and witches. For example, in 31:1, Dawood has God swearing "by those who cast out demons". Khalidi translates the same verse as: "Behold the revelations of the Wise Book."

    So this translation is a quantum leap ahead of the old Penguin version. But it also has a rather special character. Khalidi is not interested in providing the context of the verses of the Qur'an. We therefore do not always know who the Qur'an is addressing at various junctures or who is speaking to whom in its internal dialogues. Here M Abdel-Haleem's translation (OUP, £7.99), published in 2004, is more useful. Neither is Khalidi all that concerned with providing the reader with help. Footnotes, for example, would have been useful for occasional explanation of what is happening in a particular passage. Instead, he takes a rather unusual attitude to the Qur'an. It is "a bearer of diverse interpretation", he says; and its ambiguities are deliberately designed to stimulate thinking. Let the reader be "patient of interpretation" and read at will. All that is needed is to approach the text with sympathy.


    Trading symbol for new, wind-energy ETF will be... PWND
    Seriously. :spray:

    Great sector, possibly a good ETF, but a most unfortunate ticker symbol!

    Invesco PowerShares to List Global Wind Energy ETF

    CHICAGO, IL -- (MARKET WIRE) -- 06/26/08 -- Invesco PowerShares Capital Management LLC, a leading provider of exchange-traded funds (ETFs), announced today the anticipated listing of a global wind energy portfolio. The new ETF is expected to list on The Nasdaq Stock Market.

    The anticipated ticker symbol and ETF portfolio name follows: PWND - PowerShares Global Wind Energy Portfolio

    "Wind power is among the largest emerging clean energy sources on the planet, and our goal with PWND is to give investors a more innovative and precise way to access this important sector, along with the inherent structural benefits of an ETF," said Bruce Bond, president and CEO of Invesco PowerShares.


    Alert Printer Friendly | Permalink | Reply | Top
    Ghost Dog (1000+ posts) Journal Click to send private message to this author Click to view this author's profile Click to add this author to your buddy list Click to add this author to your Ignore list Thu Jun-26-08 07:54 PM
    Response to Reply #101
    113. Hmm. Interesting info (& weightings), thanks.
    ...The PowerShares Global Wind Energy Portfolio (PWND) is based on the NASDAQ OMX Clean Edge® Global Wind Energy Index. This index includes companies that are primarily manufacturers, developers, distributors, installers and users of energy derived from wind sources. The Index selects companies listed on global stock exchanges and uses a modified market capitalization-weighted methodology, with consideration to trading volume and float-adjusted market capitalization minimums. The index is reconstituted semi-annually and rebalanced quarterly.

    Index Country Weightings as of 6/23/2008

    Country Weight
    Belgium 5.67%
    Canada 3.14%
    Denmark 14.00%
    France 8.00%
    Germany 16.52%
    Greece 1.24%
    Hong Kong 5.03%
    Japan 2.29%
    Spain 22.69%
    Switzerland 3.75%
    United Kingdom 6.13%
    United States 11.55%

    Source: The NASDAQ OMX Group, Inc., based on hypothetical Index information as of June 23, 2008. The Index was not yet operational as of June 23, 2008. Allocations represent the percentages that would have been utilized if the Index had been operational. Data is subject to change. Index values do not represent Fund values. Past performance is no guarantee of future results.

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    Ghost Dog (1000+ posts) Journal Click to send private message to this author Click to view this author's profile Click to add this author to your buddy list Click to add this author to your Ignore list Thu Jun-26-08 11:14 PM
    Response to Reply #113
    137. The NASDAQ Index Components (QWND):
    Alert | Add to my Journal Printer Friendly | Permalink | Edit | Reply | Top

    The much anticipated First Trust ISE Global Wind Energy ETF (FAN) launched this week with healthy trading volume and a tight spread. Renewable energy has been a hot topic as of late, especially wind energy because of its low cost, and high efficiency. With the launch of this new fund, investors now have a chance to profit from companies in the wind energy business, as well as companies that will be entering the space.

    The First Trust ISE Global Wind Energy ETF (FAN) will aim to track the ISE Global Wind Energy Index. The index is comprised of companies that provide goods and services to the wind energy industry, and companies “determined to be significant participants in the wind energy industry despite not being exclusive to such industry”. In order to be considered for the index, the company must be engaged in some aspect of the wind energy industry such as manufacturing or design of machinery, distribution of materials, management of a wind farm, or distribution of wind generated electricity. The current top ten of the 52 holdings in the fund are as follows:

    • REpowersystems AG - 10.51%
    • Vestas Wind Systems - 10.28%
    • Gamesa - 8.81%
    • Hansen Transmissions - 6.80%
    • Japan Wind Dev. Co. - 5.13%
    • Babcock & Brown Wind Partners - 4.40%
    • Nordex AG - 4.34%
    • Theolia SA - 4.28%
    • Clipper Windpower - 2.94%
    • Gurit Holding AG - 2.81%

    On a fundamental basis, the trailing P/E ratio for the fund is 25, and price to sales is around 2.2. The total net assets for the fund are around $9.1 million, but this is likely to balloon as more investors move into the fund. The expense ratio for the fund is 0.60%, and trades on the NYSE Arca exchange.


    Thursday, 26 June 2008

    Credit Crisis: The 4th Wave?
    The TED spread is starting to rise again and is back above 1.0 for the first time since the beginning of May. Here is the TED Spread from Bloomberg. The spread is still far below the previous three waves, but well above the normal level (below 0.5).

    And from the WSJ: European Bank-Lending Anxiety Returns

    Tensions in Europe's short-term lending markets are on the rise again, repeating a pattern that central bankers had hoped to end by pumping in hundreds of billions of dollars in recent months.

    The pressure partly reflects an end-of-quarter effect, as banks hoard cash to make sure their finances look healthy when they report second-quarter results.

    But it also demonstrates that fears of further write-downs and possible failures aren't going away.

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    ozymandius Donating Member (1000+ posts) Click to send private message to this author Click to view this author's profile Click to add this author to your buddy list Click to add this author to your Ignore list Thu Jun-26-08 11:53 AM
    Response to Reply #14
    15. more on the credit burn
    Edited on Thu Jun-26-08 11:53 AM by ozymandius
    Credit Market Worries Rising?


    the Short View column in the Financial Times, keying off adverse trends in the credit default swaps market, sounded positively anxious:

    Fears are mounting that conditions are set to deteriorate markedly in credit markets.

    Lehman Brothers warned this week that spreads on credit default swaps, which track the cost of insuring corporate debt against default, could soon spike beyond the levels seen at the time of the Bear Stearns rescue in March.

    Spreads tightened a touch on Wednesday as the market hoped the £4.5bn ($8.9bn) secured by Barclays augured well for raising capital in the banking sector. However, the trend since mid-May has been disturbing.

    The Markit iTraxx Europe index of investment-grade debt has crept back up from the recent low of 66 basis points to 96bp today. Across the Atlantic, the CDX has moved over the same period from 91bp to 130bp.

    Sentiment has soured as investors have become more worried that the fallout from the subprime debacle is increasingly infecting the real economy.

    A data-rich week has offered little solace. Private sector output in the eurozone has contracted for the first time in five years, while consumer confidence and housing metrics in the US continue to be dire.

    Sharply rising input prices that can’t easily be passed on will further crimp business profit margins, increasing the risk of corporate failure.

    Adding to the woe are more ratings downgrades for the monoline bond insurers, crucial cogs in the financial system.

    So while none of this is definitive, the signs of instability are worsening. All it might take is a couple of mind-focusing bad developments in short succession for investors to start running for cover.

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    Ghost Dog (1000+ posts) Journal Click to send private message to this author Click to view this author's profile Click to add this author to your buddy list Click to add this author to your Ignore list Thu Jun-26-08 02:18 PM
    Response to Reply #15
    51. Sharply rising input prices:
    German Import Prices Have Biggest Gain in 18 Years

    June 26 (Bloomberg) -- German import prices rose the most in almost 18 years in May, adding to signs of increasing inflation pressure in Europe's largest economy.

    Prices gained 2.4 percent from April, when they climbed 0.9 percent, the Federal Statistics Office in Wiesbaden said today. That's the biggest gain since September 1990. Economists expected an increase of 1.5 percent, according to the median of 16 forecasts in a Bloomberg News survey.

    A surge in oil prices to a record $139.89 a barrel on June 16 has pushed up inflation and increased pressure on companies to pass on higher costs, even as a stronger euro makes imports more affordable. The European Central Bank has said it is ready to raise borrowing costs from a six-year high next month.

    ``Inflation pressures are much stronger than expected,'' said Thorsten Polleit, chief German economist at Barclays Capital in Frankfurt. ``It's mainly due to developments on commodity markets. Prices will continue to rise.''

    From a year earlier, import prices increased 7.9 percent after rising 5.7 percent in April, the statistics office said today. That's the strongest annual increase since November 2000. Energy costs increased 10.1 percent in the month and imported crude oil was 13.3 percent more expensive, today's report showed.

    The price of oil has increased 43 percent this year, draining the purchasing power of companies and consumers. The euro has gained 6.6 percent against the dollar over the same period.

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    DemReadingDU Donating Member (1000+ posts) Journal Click to send private message to this author Click to view this author's profile Click to add this author to your buddy list Click to add this author to your Ignore list Thu Jun-26-08 12:14 PM
    Response to Reply #14
    21. The TED Spread
    Edited on Thu Jun-26-08 12:17 PM by DemReadingDU
    The willingness of banks to LEND TO EACH OTHER is truly measured by the TED spread.

    The TED spread is the difference between 3-month LIBOR and 3-month Treasuries.

    The significance of this spread is that it represents the spread between the rate charged for lending to a bank and the rate charged for lending to the government.

    It effectively measures the perceived credit risk of banks relative to the government (the credit risk premium).

    That spread generally indicates how much FEAR is in the banking system (about the banking system ITSELF).

    Even though the media doesn't focus much attention on this indicator (AS IT SHOULD), it should not be dismissed or taken lightly. It is very serious.

    You can find the rate for 3-month LIBOR and 3-month Treasuries at this link:

    Written by Bernard on 2007-12-01 08:33:06

    edit to add link for the TED Spread chart

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    Roland99 (1000+ posts) Journal Click to send private message to this author Click to view this author's profile Click to add this author to your buddy list Click to add this author to your Ignore list Thu Jun-26-08 08:45 PM
    Response to Reply #21
    120. not pretty.

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