| CME bid spurs fears of merger monster
THE commodities boom is intensifying the merger mania among the world's financial exchanges. But the $US11 billion ($12.4 billion) bid by CME Group to acquire Nymex Holdings may fuel worries that consolidation is leaving the survivors with too much power. A purchase of the 135-year-old New York Mercantile Exchange's owner by CME, parent of the Chicago Mercantile Exchange, would create the largest exchange in the world, with a stock market value of about $US45 billion. And acquiring Nymex's crude oil futures, one of the largest commodity contracts in the world, would fill the last major hole in the 110-year-old Chicago exchange's product line-up, while squeezing remaining rivals in the energy market. The deal also highlights some unsettling consequences of the global scramble for alliances and market share in trading financial securities.
Pressure mounts for new controls on oil futures speculators
Sean Cota runs a family-owned fuel oil business in Bellows Falls, Vt., and has been active in the futures markets for 20 years, locking in prices to protect both himself and his customers. But over the past five years, he has watched in amazement -- and growing anger -- as speculators flooded into the market. It has created tremendous volatility and, he believes, driven up prices for crude oil, heating oil and a host of other commodities. As prices hover near record levels this year, his customers are bearing the brunt -- turning down their thermostats, taking longer to pay their bills and even using credit cards to pay for home heating. "All of these things are having a huge impact on people for something that is just not justified by supply and demand," Cota said.
NYMEX to Launch 11 New Balance of Month Petroleum Products Swap ...
NEW YORK, Nov. 20 /PRNewswire-FirstCall/ -- The New York Mercantile Exchange, Inc. today announced that it will introduce 11 new balance of month (BALMO) petroleum products swap futures contacts on NYMEX ClearPort clearing and trading, beginning on December 2 for trade date December 3. The new BALMO contracts will be cash-settled based on the balance of month average Platts price starting from the day of execution through the last trading day of the contract month. These contracts allow users to customize the balance of month period by selecting the start date of the BALMO averaging period. The first listed month will be the December 2007 contract, and the next contract month will be listed 10 business days before the start of the contract month. The new swap futures contracts and their commodity codes are: Singapore 180cst fuel oil BALMO (BS); Singapore 380cst fuel oil BALMO (BT); Singapore jet kerosene BALMO (BX); Singapore gasoil BALMO (VU); Singapore naphtha BALMO (KU); Dubai crude oil BALMO (BI); European 3.5% fuel oil (Northwest Europe) BALMO (KR); European 1% fuel oil (Northwest Europe) BALMO (KX); European naphtha BALMO (KZ); New York Harbor 1.0% fuel oil BALMO (VK); and Gulf Coast 3% fuel oil BALMO (VZ).
Michael Gerson: A compassione conservative -- really
It was the most matter-of-fact of his congressional addresses: a clear theme -- trusting the people -- developed at a brisk pace, with modest proposals and an edge of impatience at congressional loitering. He seemed to be saying: "With a year to go, sentiment be damned." But there is nothing to prevent me from waxing nostalgic. Watching the speech, I recalled meeting Gov. Bush of Texas in the spring of 1999, before he was a declared candidate. He talked with rushed intensity about being a "different kind of Republican," dedicated to racial healing and helping the poor and determined to provide moral leadership as a contrast and corrective to the Clinton years. Because I believed him, I left journalism and joined his campaign. It is conventional wisdom that Bush's idealism is either a fraud or has been pushed aside completely by the priorities of war.
'Black Swan' author Nassim Taleb warns traders to look out for the ...
Market meltdowns that scorch investors, 100-year floods that occur every 10 years and terrorist attacks such as 9/11.
Nassim Taleb, an author, lecturer and big thinker, calls such unforeseen events "black swans," borrowing from a tale about 17th Century European seafarers who landed on Australia and, much to their surprise, learned that not all swans were white.
Such shocks occur, Taleb says, because even experts fail to consider the likelihood of extreme scenarios. That's why his theory, outlined in his book, "The Black Swan: The Impact of the Highly Improbable," is so intriguing to Chicago's trading community, which seeks to lessen risk by exchanging futures and options. His ideas have earned him cachet with investment bankers as well as rock 'n' rollers.
Stocks End Higher On Fed Minutes - U.S. Commentary
The markets shrugged off inflation fears, taking comfort from the minutes of the Federal Reserve's latest meeting.
Stocks saw early weakness after the Labor Department released its report on consumer price inflation for the month of January, which is one of the best indicators of inflation within the U.S.
The Labor Department's consumer price index rose 0.4 percent in January, matching the increase seen in the previous month. Economists had been expecting a slightly more modest increase of about 0.3 percent. The core consumer price index, which excludes food and energy prices, increased by 0.3 percent, exceeding economist estimates of a 0.2 percent increase.
Later in the day, the major averages moved into positive territory, as the Federal Open Market Committee released the minutes from its last meeting in January.
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