Word began to spread among fixed-income traders nine days ago that European banks had stopped trading with Bear. Some U.S. fixed-income and stock traders began doing the same on Monday, pulling their cash from Bear for fear it could get locked up if there was a bankruptcy... http://online.wsj.com/article/SB120567392987839629.html?mod=googlenews_wsj
The developer of the Cosmopolitan Resort Casino, a $3.9 billion condo-hotel complex on the Las Vegas Strip, has been notified by its primary lender that it will begin foreclosure proceedings.
The move by Deutsche Bank AG, the lender on a $760 million senior loan, comes after the developer, Ian Bruce Eichner, wasn't able to finalize a deal for new financing amid the credit crunch. Mr. Eichner in late February cut a tentative deal with two of his other lenders, Global Hyatt Corp. and New York hedge fund Marathon Asset Management, for a possible rescue of the twin-tower project. A default ... http://online.wsj.com/article/SB120554452781938671.html?mod=googlenews_wsj
One UK economist warned that the world is now close to a 1930s-like Great Depression, while New York traders said they had never experienced such fear. The Fed's emergency funding procedure was first used in the Depression and has rarely been used since.
A Goldman Sachs trader in New York said: "Everyone is in a total state of shock, aghast at what is happening. No one wants to talk, let alone deal; we're just standing by waiting. Everyone is nervous about what is going to emerge when trading starts tomorrow."... http://www.independent.co.uk/news/business/news/wall-street-fears-for-next-great-depression-796428.html
Can there be USD Intervention?
# Bloomberg: Goldman Sachs and Morgan Stanley say coordinated action by policy makers to stem US dollar slide increasingly likely
# March 2008: Europe and Japan express concern over sliding dollar - may intervene
# CIBC: Intervention unlikely until USD/JPY moves below 100 and EUR/USD moves to $1.60
# MS: Intervention more likely if EUR/USD surpasses 1.50, USD/JPY nears 100; MoF may have conducted stealth interventions or bought EUR/USD in Q407
# SG: Official intervention in support of the dollar likely to materialize in the event of a sharp (and disorderly) move in USD or sharp and broad-based deterioration in growth outside US
# Econocator (not online): 30% chance of intervention by BoJ, RBA, RBNZ on a rapid unwind of carry trade
# Feldstein: Europe must focus on dollar peggers (asia, oil exporters) to halt EUR/USD appreciation
# Whereas Australia, New Zealand intervened to slow appreciation in 2007, subprime turmoil later had Australia intervene to slow depreciation in August
# In 2007, New Zealand switched to unhedged FX reserves to improve tool for 'moderating extremes in NZD
