28.09.2008

• Black Mondays are passe. Battering weekends are in...
• US's sixth largest bank Wachovia is reported to be scouting for buyers. Its CEO Robert Steel is reported to have classified a $122 billion portfolio of option adjustable rate mortgages as “distressed.”
• The bank suffered a record $9.11 billion loss in the second quarter and some analysts have said it may need more capital after raising $8.05 billion in April.
• Here is a very good article from Mythili Bhusnurmath on what the collapse of the i-Banks means.
• A must read. Do so here.
• What will be contours of the Wall Street after the present turmoil?
• Look at this piece written by David Henry & Matthew Goldstein. It is very educative. It may look complicated for some of you. But when history is being made; you can't afford to miss living it. Some excerpts for our record:
  
• How bad things will get from here depends on how cleanly the losing firms and toxic investments can be extricated from the rest. With each passing day the task seems to grow more difficult. By the end of the credit bust, the total losses, now $500 billion, could reach $2 trillion, according to hedge fund Bridgewater Associates. What’s likely to be left when the Great Unwind is finally complete? A smaller, humbler, highly regulated Wall Street barely recognizable from its heady past, where caution reigns and wild risk-taking is taboo.
• Whereas big commercial banks like Citigroup and JPMorgan Chase rely on a steady base of deposits to finance their operations, large investment banks have come to resemble high-flying hedge funds, borrowing short term cash from other firms to invest in riskier securities. Goldman’s gross leverage ratio — one measure of borrowed money —jumped from 18.7 times assets in 2003 to 26.2 by 2007. Morgan Stanley’s topped 32 last year. See the growth in leverage levels in this graphic.
  
• This graphic shows you how badly the market valuations of these banks have shrunk.
  
• Already there are new signs of distress. At the height of the mortgage boom, scores of small to midsize banks binged on risky debt investments called trust preferreds that allowed them to collect cash from investors and gave banks the right to defer their interest payments. With mortgage loans and related investments going bad, at least 38 banks in the past 12 months have stopped making their payments. Several have been seized by regulators, including IndyMac and Silver State Bancorp. For others, like FirstBank Financial Services, CapitalSouth Bancorp, and Omni Financial Services, the decision not to pay raises a red flag. First Bank, CapitalSouth, and Omni could not be reached for comment. This means that the end of bad news is not yet sighted.
• Mobile phones to work as credit or debit cards in India?
  
• In a development that could completely liberalise mobile commerce, the department of telecommunication (DoT) is reported to be contemplating writing to the Reserve Bank of India (RBI) seeking guidance on linking telephone networks with banking services.
  
• Mobile commerce in India has been limited primarily to basic banking transactions, purchase of travel tickets and payment of some utility bills, checking your account balance and last few transactions.
• We all know that BCCI is one of the richest sports bodies in the world. But do you know its yearly income?
• It is a cool Rs. 1000 crore in 2007-08.
• In 2006-07 it was Rs. 651.81 crore.
  
• The major chunk contributing to the massive increase of Rs 348 crore in its revenue, amounting to Rs 559 crore, has come from the sale of media rights, an upward movement of Rs 245 crore. It was Rs 313 crore in the previous year. Surplus from tours brought in Rs 226 crore, an increase of Rs 12 crore, interest income Rs 76 crore (increased by Rs 25 crore) and others Rs 138 crore (increased by Rs 65 crore).
• BTW, Sharad Pawar, who is now ICC president-elect, handed over the BCCI reins to new president Shashank Manohar.
• While reading today's paper, I was struck by the phrase 'hornet's nest.'
  
• While I know what a hornet's nest is, (Kandireegala thutte in Telugu), the dictionary meaning of the phrase led me to the word 'wasp.'
  
• That in turn made me curious about knowing the difference between a hornet's nest and a honeycomb and a wasp and a bee.
• Look at this beautiful explanation. Worth a digression.
• Here is one more article that updates our knowledge of farm activities in the country and how it is safe to bet on companies and products that help farmers replace manual labour.
• Read it here.
• Farmers are spending up to 40 paise on hiring labour out of every rupee they invest in a crop. Even then, there is no guarantee of help at the right time to cope with the back-breaking task of growing food, fibre and feed. In theory, one out of every two Indians is employed on a farm. In reality, skilled labour is now so scarce and expensive, farm-owners have to either scale down operations or suffer yield and quality losses. The reasons for this shortage range from urban migration and the lack of interest in farming among youth to the Centre’s rural employment guarantee programme. As a result, farmers can no longer rely on muscle power; the available labour has lower productivity; and there are fewer hands available within the family to help on the farm.
• Today is World Heart Day
• One more day to remember. Why is this so important?
• Heart disease is the number one killer worldwide and it’s estimated that 80% of cardiovascular-related deaths occur in low and middle income nations. India is also set to see a dramatic number of working age people (35-65 years’ old) die of cardiovascular disease in the next 30 years. Therefore, we should know that Lipid profile is the test that measures cholesterol levels. Some cholesterol levels worth remembering:
• LDL should be below 130 mg/dl, triglycerides below 125 mg/dl and the HDL should not go below 35 mg/dl for a good heart health.