Commodities crater on inflation outlook, economy Fed's warning on inflation, renewed economic fears take steam out of rally Prices in oil, gold, wheat and other commodities took a dive Wednesday, one day after the Federal Reserve highlighted its inflation concerns as it cut rates and indirectly took away some of the fizz from the recent commodity rally. The Fed's rate cut of 75 basis points, less than the market expected, and its statement acknowledging the threat of inflation served as "fair warning to commodity speculators," according to William Knapp, managing director at In past weeks, inflation worries, fueled in part by the Fed's focus in recent months on cutting rates to spur growth, sent investors flocking to oil, gold and grains as safe-haven investments. The weak dollar, which had fallen alongside the rate cuts, had also helped push these dollar-denominated commodities to record highs.
Gov't Eases Fannie, Freddie Restraints FThe government on Wednesday relaxed capital requirements at Fannie Mae and Freddie Mac as part of a plan to quickly inject an additional $200 billion of financing for home loans. The initiative, which will require Fannie and Freddie to raise substantial funds, is part of a broader government strategy to ease a credit crisis that has made it difficult for consumers and businesses to borrow, and spread fear throughout global financial markets.
CEO: Ford Layoffs Possible if Buyouts Fail Ford Motor Co has other options to cut costs if a just-completed round of buyouts for its U.S. blue-collar work force comes up short of its targets, the automaker's chief executive said Wednesday. "We have a lot of other options to keep right-sizing the place," Ford Chief Executive Alan Mulally said in a presentation to analysts in New York that was monitored by Webcast.
Carlyle Capital: Fund is Insolvent Investment company Carlyle Capital Corp said on Wednesday that its liquidators have determined the fund to be insolvent and that investors were not likely to get any proceeds after its operations wind up. Amsterdam-listed Carlyle, which late on Tuesday asked for trade in its shares to be suspended, said in a statement that it had "extremely limited cash assets".
Securities Drag Credit Suisse 2007 Credit Suisse Slashes 2007 Figures, Cuts Forecast After Internal Probe Into Securities Credit Suisse Group on Thursday slashed previously released 2007 profit figures because of an internal investigation into securities valuations and said it doesn't expect to post a profit for the first quarter. Credit Suisse said it has determined that the pricing errors "were, in part, the result of intentional misconduct by a small number of traders.
Citigroup Plans to Cut More Than 5% of Securities Employees Citigroup Inc., the biggest U.S. bank by assets, plans to cut more than 5 percent of staff in the securities unit to rein back expenses after U.S. subprime- mortgage related losses. Dollar Rises Against Euro, Yen as Oil, Commodity Prices Decline The dollar rose to its strongest in a week against the euro as speculation a global economic slowdown will reduce demand for raw materials pushed gold and oil lower. The European common currency declined after Credit Suisse Group said it may have a loss this quarter because of writedowns on debt securities. The dollar climbed to the highest level in more than a week versus the currencies of its major trade partners as crude dropped after a U.S. government report showed weaker demand for fuel.
As Bear Stearns Implodes, Spector Keeps $382 Million Warren Spector, forced out as president of Bear Stearns Cos. last August, may have outdone his former mentor James ``Jimmy'' Cayne as the 85-year-old brokerage firm imploded. After a spat over politics in 2004, Cayne, then Bear Stearns's chief executive officer, changed the company's deferred compensation plan, prompting Spector to sell $382 million of stock. As of last March, his stake in the New York-based firm had dwindled to 0.06 percent, worth about $8 million when he left.
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