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"Treasuries Fall on Concern Record Sales Will Overwhelm Demand
May 27 (Bloomberg) -- Treasuries fell for a fourth day, pushing the difference in yields between two- and 10-year debt to a record amid concern record supply will overwhelm investor demand as the economy begins to show signs of stability.
The slump in Treasuries is helping to send yields on mortgage bonds higher, prompting holders of the securities to sell government debt used as a hedge to protect portfolios against rising interest rates.
‘We are in a bit of a freefall,” said Kevin Giddis, head of fixed-income sales, trading and research at the brokerage Morgan Keegan Inc. in Memphis, Tennessee. “This is the beginning of a lot of sales.”" (More)
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"Treasury Yield Curve Steepens to Record as Debt Sales Surge
May 27 (Bloomberg) -- The difference in yields between Treasury two- and 10-year notes widened to a record on concern surging sales of U.S. debt will overwhelm the Federal Reserve’s efforts to keep borrowing costs low." (More)
"Today our virtual marine portal offers hospitality to more than 100.000 web sites worldwide and our web traffic statistics shows more than 2000 visitors per day. You may open this window so as to be part of our on-line community, easily and with the lowest cost possible.Posted by newsbysector.
Infomarine On-Line offers the most efficient way to present your company over the internet and to become known to more and more potential business clients." (Source)
ABOUT: "NAREIT®, the National Association of Real Estate Investment Trusts®, is the worldwide representative voice for REITs and publicly traded real estate companies with an interest in U.S. real estate and capital markets. NAREIT's members are REITs and other businesses throughout the world that own, operate and finance income-producing real estate, as well as those firms and individuals who advise, study and service those businesses." (About Section)
"HousingWire.com and HousingWire Magazine represent the premier independent source for news, commentary and analysis covering the entire mortgage banking and financial markets."Posted by newsbysector.
"CleanTech Brief reports on who's who and what's what in the world of clean technology investing. The seasoned reporters at CleanTech Brief bring you the latest news on cleantech-focused hedge funds, private equity funds, venture capital vehicles, sovereign wealth funds and mutual funds, as well as updates on dealflow."Posted by newsbysector.
"America's freight railroads operate the safest, cleanest, healthiest, most efficient and most environmentally sound rail system in the world — and at the Association of American Railroads we're committed to keeping it that way. AAR members include the major freight railroads in the United States, Canada and Mexico, as well as Amtrak. Our membership organization oversees a 140,000-mile rail network and sets new standards for innovation, safety and technology." (aar.org)
"Release Date: May 19, 2009
The Federal Reserve Board on Tuesday announced that, starting in July, certain high-quality commercial mortgage-backed securities issued before January 1, 2009 (legacy CMBS) will become eligible collateral under the Term Asset-Backed Securities Loan Facility (TALF).
The TALF is designed to increase credit availability and support economic activity in part by facilitating renewed issuance of consumer and business asset-backed securities (ABS) and CMBS. The Board authorized the TALF on November 24, 2008, under section 13(3) of the Federal Reserve Act. Under the TALF, the Federal Reserve Bank of New York (FRBNY) has extended loans secured by triple-A-rated newly issued ABS backed by certain consumer and business loans and leases. On May 1, 2009, the Board announced it would expand the range of acceptable TALF collateral to include newly issued CMBS starting with the June subscription.
On March 23, 2009, the Federal Reserve announced that it would evaluate extending the list of eligible collateral for TALF loans to include certain legacy securities. The objective of the expansion is to restart the market for legacy securities and, by doing so, stimulate the extension of new credit by helping to ease balance sheet pressures on banks and other financial institutions. Tuesday’s announcement marks the first addition of a legacy asset class to the list of eligible TALF collateral.
The CMBS market, which has financed approximately 20 percent of outstanding commercial mortgages, including mortgages on offices and multi-family residential, retail and industrial properties, came to a standstill in mid-2008. The extension of eligible TALF collateral to include legacy CMBS is intended to promote price discovery and liquidity for legacy CMBS. The resulting improvement in legacy CMBS markets should facilitate the issuance of newly issued CMBS, thereby helping borrowers finance new purchases of commercial properties or refinance existing commercial mortgages on better terms.
To be eligible as collateral for TALF loans, legacy CMBS must be senior in payment priority to all other interests in the underlying pool of commercial mortgages and, as detailed in the attached term sheet, meet certain other criteria designed to protect the Federal Reserve and the Treasury from credit risk. The FRBNY will review and reject as collateral any CMBS that does not meet the published terms or otherwise poses unacceptable risk.
Eligible newly issued and legacy CMBS must have at least two triple-A ratings from DBRS, Fitch Ratings, Moody’s Investors Service, Realpoint, or Standard Poor’s and must not have a rating below triple-A from any of these rating agencies. More broadly, the Federal Reserve is formalizing procedures for determining the set of rating agencies whose ratings will be accepted for various types of eligible collateral in the Federal Reserve’s credit programs.
The initial subscription date for TALF loans collateralized by newly issued CMBS will be June 16, 2009. The subsequent subscription dates for TALF loans collateralized by newly issued and legacy CMBS will be announced in advance. The subscription date for loans collateralized by all other ABS will remain toward the beginning of the month.
A new term sheet and a frequently-asked-questions document, specific to legacy CMBS, are attached. Also attached are a revised term sheet and frequently-asked-questions document for newly issued asset-backed securities and CMBS." (FederalReserve.gov)
Commercial mortgage delinquencies in the U.S. climbed to the highest level in at least 11 years in April as scarce credit made it difficult for landlords to refinance loans, according to property research firm Trepp LLC.
The percentage of loans 30 days or more behind in payments rose to 2.45 percent, Trepp LLC said in a report. The delinquency rate was more than five times the year-ago number, Trepp said. The New York-based researcher’s records go back to 1998.
“It’s about as bad as it’s ever been,” said Thomas Fink, a Trepp senior vice president. “I don’t think we’re done yet. Where it’s going to top out, I don’t know, but we’re not done.”
Properties bought in 2006 are now worth on average 11 percent less than their original price, and those bought in 2007 are worth almost 20 percent less, Moody’s said." (Source: Bloomberg)
"It is expected that industry net operating income, a key financial measure for the realty trusts, will be down in the low-to-mid single digits for 2009 and 2010, thanks to declining rents for office buildings, apartments and shopping malls."
"Other major challenges lie ahead. Goldfarb expects what he calls the "re-equitization" of REITs to continue, with potentially tens of billions of dollars of capital left to be raised." (Alexander Goldfarb, a REIT analyst at Sandler O'Neill)
"The Federal Reserve Board on Tuesday announced that, starting in July, certain high-quality commercial mortgage-backed securities issued before January 1, 2009 (legacy CMBS) will become eligible collateral under the Term Asset-Backed Securities Loan Facility (TALF)." (FederalReserve.gov)
"RICK KARR: But traffic on Chicago's rails is even slower than traffic on its roads. A 2002 study found that freight trains pass through the city at an average of just 9 miles an hour.
DINO MCCULLOUGH: I got a 10-mile-an-hour track restriction here. I can only go 10 up here. They just might be out there working on track. It just could be anything, you know? It could be broken rail.
RICK KARR: One reason for the slow speed is that some of the technology on Chicago's rails hasn't emerged from the 19th century. For example, McCullough and Dooley had to bring their 130-car train, which was carrying nearly 9,000 tons of coal, to a dead stop in the city so that Dooley could climb down through the locomotive and make sure that it went on to the right track at a switch by hand, even though most switches these days operate by remote control." (Transcript, PBS.org)
"FRANK BARRE, UPS: The typical lifespan of a package in this facility is less than 15 minutes. This facility can process above 100,000 packages per hour. We've actually demonstrated during our Christmas peak period of processing more than 120,000 packages per hour.
RICK KARR: Barre says, if railroads want to do business in the 21st century, they need a 21st-century rail network.
FRANK BARRE: The railroads need to certainly make sure that consistently they provide good service. There needs to be an increased amount of technology placed into the rail system, as well as more capacity, as we have the growth to move goods.
RICK KARR: But, he says, railroads can't do it alone. They need cooperation from industry and government." (Transcript, PBS.org)
"Reuters cited Mr Simon Crean Australia's Trade Minister as saying that Australian exporters of iron ore and coal are enjoying healthy sales to China thanks to Beijing's economic stimulus plan, but they could create oversupply if the economy slows.
Mr Crean said that "I think what's important is the stimulus packages that the Chinese government has implemented some AUD 800 billion worth, going significantly into infrastructure is clearly going to be a benefit to Australia's resource industry. He said that and it's true that it might create, in the future, a circumstance of oversupply, but that's only if the domestic economic activity slows." (Steel Guru)
"Globally also, some interesting developments are taking place. As reports in the Lloyd’s List suggest, a rather more sedate set of investment funds is moving towards the shipping sector. New investment funds have started raising a couple of billion dollars to take advantage of the distressed prices of shipping assets.
With leverage, it is felt, the funds could muster financial strength of $5-6 billion. The reports also give names of some funds whose managers are believed to be tapping investors, raising hope that a plentiful supply of cheap tonnage is becoming available and that there will be trading profits between entry and exit, the underlying principle being the simple old concept of buying cheap and selling dear." (HinduBusinessLine)
