The US Federal Reserve cut its target for overnight interest rates to a range of 0-0.25%. This now closes option for any further rate cut. The Fed also said it would expand its policy of buying mortgage-backed securities to support the housing market and that it was now considering the benefits of purchasing long-term treasury bills – a move first used by President Franklin Roosevelt in the Great Depression to push down long-term interest rates.
A treasury bill is taditionally a short term zero coupon bond i.e. they do not pay interest. They are instead issued at a discount to their face value. Like any Government bonds there is very little risk attached to investing in treasury bills. Default risk on a government's borrowings in its own currency is low enough to be regarded as zero.
Gloom at Wall Street
Morgan Stanley posted a $US2.2 billion fourth-quarter loss, wider than the most pessimistic analyst's estimate, as it unexpectedly wrote down the value of fixed-income businesses and lost money in all three of its main divisions.
Goldman Sachs, the 139-year-old investment bank reported its first quarterly loss since becoming a public company 10 years ago. For the period ended
OPEC cuts oil production
Organisation of the Petroleum Exporting Countries (OPEC) yesterday decided to pull an extra 2.2 million barrels per day (bpd) out of production from 1 January. This aimed to put a floor on crude price at $43 a barrel. It seems the news is not taken positively as crude is now trading at $39.8 a barrel.
TATA on Ferrari
Tata will be riding on Ferrari in coming season of Formula -1. Soon we"ll see Tata logo on F-1 cars of Felipe Massa and Kimi Raikkonen. This comes as a 'historic' news as claimed by Ferrari management. Tata on the other hand believes it as one of the cheapest way to get promotion globally.
Satyam (contd. from yesterday)
Satyam share in India fell by 30% yesterday at close. ADRs soar up 50% after Satyam called off the deal. Maytas Infrastructure fell by 20% yesterday and its further down 20% today. One costly mistake has caused Satyam promoters 600 crores.
No comments:
Post a Comment