32 THE WALL STREET JOURNAL. Thursday, October 14, 2010 DJIA 11096.08 À 0.69% Nasdaq 2441.23 À 0.96% Stoxx Eur 600 266.25 À 1.44% FTSE 100 5747.35 À 1.51% DAX 6434.52 À 2.06% CAC 40 3828.34 À 2.12% Euro 1.3960 À 0.91% Pound 1.5838 À 0.33% Building a booming business Chinese party elders make after that eureka moment call for more freedoms HEARD ON THE STREET THE JOURNAL REPORT WORLD NEWS 9

Email: [email protected] FINANCIAL ANALYSIS & COMMENTARY WSJ.com/Heard Consumers in Central bankers play moving targets VOL. XXVIII NO. 180 Thursday, October 14, 2010 Russia come in EUROPE europe.WSJ.com What exactly are central banks normal recovery would have seen it the side of doing too much rather targeting these days? The old ortho- up 10% by this point, Deutsche Bank Deflated growth than too little. from the cold doxy held that the primary focus of points out. Annual change in the U.S. GDP The policy carries huge risks. But monetary policy should be fighting In the U.K., where policy remains Nominal price rises for gold and inflation- Commodities or consumers? Chile breathes sigh of relief as miners are rescued inflation. But some leading central extremely loose despite inflation 6% linked bonds suggest that a return to Russia may be rich in resources, but banks appear actively to be trying to persistently above 3%, there also is inflation is starting to be baked in. increasingly it is the spending create inflation as a way of boosting more talk about another bout of 4 Tipping the balance toward inflation power of 140 million Russians as nominal GDP growth, and easing the quantitative easing, prompting Gold- should boost the allure of equities as their living standards rise to catch U.S.facilitates deleveraging process in countries man Sachs to speculate on whether 2 real assets over bonds as nominal up with the rest of Europe that is weighed down both by high public- the Bank of England now is pursuing assets. And yet, so far flows into exciting investors. Imminent initial and private-sector debt burdens. If a covert policy of nominal GDP tar- 0 bonds have shown little sign of slow- public offerings from food retailer so, this will have profound conse- geting. Nominal GDP grew 5.7% for ing: U.S. equity mutual funds saw O’Key Group and Internet firm quences for investors weighing the the year to June. Indeed, deputy –2 $19 billion of outflows in September, Mail.ru Group should underscore balance between bonds and equities. governor Charles Bean gave an ad- Inflation adjusted while bond funds saw $32 billion of the trend. The U.S. Federal Reserve is lean- miring lecture three years ago on the –4 inflows, data from the Investment Meanwhile, planned listings of Kabul contact ing toward more quantitative easing merits of nominal GDP targeting. The 1990 ’95 ’00 ’05 Company Institute show. resources companies gather dust. even though it sees only small odds European Central Bank looks almost Source: Bureau of Economic Analysis Long-dated U.S. Treasury inves- Buoyant commodity prices alone of deflation; the minutes of the last isolated in its “inflexible” attach- tors can salivate at the prospect of aren’t enough to sell an IPO amid so Fed meeting note that one strategy ment to inflation-fighting and its the price-insensitive Fed increasing much global economic uncertainty. for affecting inflation expectations distaste for quantitative easing. driving activity in the real economy. its purchases, even with yields al- In the one listing underway, gold might be to target nominal GDP Of course, quantitative easing Over time, policy makers seem to ready at rock-bottom levels. But if miner Petropavlovsk has halved the growth. With real growth sluggish, mightn’t succeed in triggering core hope that asset-price inflation will the central bank does succeed in amount it wants to raise from float-

£1.50 with Taliban the Fed would hope to boost the price inflation, at least in the short boost confidence and encourage risk- juicing inflation, anybody left hold- ing its iron-ore unit to $240 million. nominal number with higher infla- term. The impact may be simply to taking. They ultimately have the ing the bonds is in for a rude awak- O’Key and Mail.ru, seeking to tion. U.S. nominal GDP is now only inflate the price of financial-sector power to generate inflation if they ening. —Richard Barley raise up to $500 million and $750 BRUSSELS—U.S.-led inter- ernment,” the senior NATO of- Attempts were unsuccess- 3.7% above its trough, whereas a assets and commodities, rather than choose and seem willing to err on and Simon Nixon million, respectively, have easier national forces in Afghanistan ficial told reporters traveling ful late Wednesday to reach stories. Russia’s population is have been helping to facilitate with Defense Secretary Robert representatives of the Afghan- shrinking but disposable incomes preliminary contacts in Kabul Gates. They were both in based Taliban. are forecast to rise 60% by 2015. between President Hamid Kar- Brussels to attend a meeting It is unclear how many Russia is Europe’s fifth-largest food- zai’s government and Taliban of the trans-Atlantic alliance. channels of communication At Standard Chartered, a puzzling rights issue retailing market. Penetration by representatives, a move that “These are contacts that have been opened between modern stores is 40%, half that of signals a shift by the U.S. to have taken place in Kabul. It Mr. Karzai’s government and Standard Chartered’s decision to its cost of equity, suggesting the bank that is valued like a retail Western Europe. Mail.ru is invested more active support of Afghan would be extremely difficult the Taliban, and the senior tap shareholders for an extra £3.3 Bouncing back capital is likely to be deployed prof- bank. Wholesale banking, expected in Russia’s top three Internet sites. Oman ORBahrain 2 BD 1.50 -Jordan Egypt $1.75 JD2-KuwaitKD1- (C/V) Qatar QR14 - Saudi Arabia SR 14 reconciliation efforts. for a senior Taliban member NATO official provided few billion ($5.2 billion) is a puzzle. The itably. The bank also reckons that a to provide the bulk of future The country, with 45 million Inter- to get to Kabul without being details except to say that the U.K.-listed emerging-markets bank Standard Chartered share price postrights issue 11% core Tier 1 ratio growth, already accounts for about net users, ranked eighth globally in By Adam Entous in killed or captured if ISAF were talks facilitated by Western has a core Tier 1 ratio of 9% under in London, in pence will prove a competitive advantage. 80% of operating profits. True, this 2008 but penetration is well below Brussels and Julian E. not witting, and ISAF is wit- forces took place in Kabul. current Basel rules and is likely to 2100 But investors should question division includes many low-risk Western European levels. Internet Barnes in Washington ting,” the senior NATO official Earlier this month, Afghan generate more than $4 billion of 1800 whether Standard can maintain this commercial-banking activities. But use could rise 15% a year on average said, referring to the U.S.-led officials, retired Pakistani se- capital in 2010 and pay out $1.4 bil- expansion without compromising its earnings are more volatile and between 2009 and 2013, based on The previously undisclosed International Security Assis- curity chiefs and former Tali- 1500 lion in dividends. Even allowing for underwriting standards. Risk- volumes and margins are sure to consultants J’son & Partners. Western assistance, described tance Force. ban leaders held talks in Kabul impending changes to regulatory 1200 weighted assets increased 19% in the come under increasing pressure as Russian retail stocks have out- by a senior North Atlantic The official declined to say to try to find ways to open risk weightings, likely to lop one 900 first half alone, far outstripping eco- global investment banks increas- performed the wider Moscow stock Treaty Organization official in who on the Taliban side was peace talks with the insur- percentage point off its core Tier 1 600 nomic growth in the markets where ingly focus on emerging markets. market by 27% this year. O’Key ri- Brussels and a second official, participating in the talks, and gents. But those meetings, ratio, it hardly looks short of capital. it operates at a time when global Not only does that point to lower vals Magnit JSC and X5 Retail includes safe passage for cer- whether they represented top sponsored by the United Arab Standard says it needs capital to 300 policy makers are increasingly wor- sustainable returns and higher costs Group trade at 24 times 2011 earn- tain Taliban leaders to Kabul leaders such as Mullah Mo- Emirates in Kabul’s luxurious meet future regulatory demands 0 rying about emerging-market asset of equity than is reflected in its cur- ings. Mail.ru would be the biggest for the talks. Previously, the hammed Omar, who is be- Serena Hotel, didn’t involve without sacrificing its breakneck 2000 ’02 ’04 ’06 ’08 ’10 bubbles. rent valuation of 2.5 times tangible listed emerging-market Internet U.S. military had said Mr. Kar- lieved to be hiding in Pakistan. insurgents. The Taliban’s offi- pace of organic growth. It fears Source: Thomson Reuters Standard missed first-half earn- book value. It also reduces Stan- firm after China’s Alibaba.com and zai’s reconciliation efforts “These are in the very prelimi- cial position has long been to other national regulators may copy ings estimates due to higher-than- dard’s appeal as a takeover target Baidu Inc., trading at 35 times and were premature. nary stages of discussions, so refuse all peace contacts as Switzerland in demanding faster im- expected costs; it is recruiting heav- both for emerging market retail 45 times, respectively. O’Key could “We have indeed facili- you would not yet character- long as U.S.-led international plementation of Basel III and also form of contingent convertible ily in a competitive market for banks and Western investment be valued at up to $3.3 billion and Getty Images tated, to various degrees, the ize this by any means as a ne- forces remain in the country. require systemically important bonds rather than straight equity. emerging-market bankers, expand- banks looking to get a leg up in Mail.ru, up to $5 billion if priced at Chilean miner Carlos Barrios salutes as he emerges from the rescue capsule Wednesday. He was the contacts between these senior gotiation,” the official said. Officials said the UAE banks to hold extra capital buffers. Still, shareholders won’t grumble ing in less familiar activities such as emerging markets: After all invest- small discounts to those valuations. 13th to be freed in the dramatic operation to bring up 33 men trapped 622 meters below ground. By Taliban members to the high- But he described the Taliban round was one of several But while these risks are real, there too much at this pre-emptive strike: mergers and acquisitions. Integrat- ment banks have recently changed True, some metals IPOs are likely late afternoon local time, 22 miners had been brought to the surface. Articles on pages 14-15. est levels of the Afghan gov- participants as high level. Please turn to page 10 is no certainty if, when or how they Standard has boosted income at an ing these hires will be a manage- hands only at distressed levels. to get to market. But for now, it is will materialize. Besides, Switzer- average 19% for the past seven years ment and cultural challenge. The bigger it gets, the riskier it the capacity of Russia’s consumers land is allowing its large banks to and last year delivered a return on Meanwhile, Standard risks look- becomes: No wonder regulators to come in from the cold that is ex- hold the extra capital buffer in the tangible equity of 19.5%, well above ing increasingly like an investment want more capital. —Simon Nixon citing investors. —Matthew Curtin The Quirk J.P.Morgan’s mortgage review Hardware&Software overshadows earnings jump Engineered to J.P. Morgan Chase &Co. Meanwhile, J.P. Morgan set to its investment-banking unit Work Together widened its review of foreclo- aside $1.3 billion of additional by 31% during the third quar- sures to 41 states and 115,000 pretax litigation reserves in ter. The bank set aside just When Is a bagel not really loan files, making it the latest the quarter, “including those over $2 billion to pay staff in a bagel? When it’s an U.S. bank to take a more com- for mortgage-related mat- the business, which earned Exalogic prehensive look at its docu- ters.” J.P. Morgan Chief Exec- $1.3 billion in the quarter— obwarzanek krakowski. Elastic Cloud Page 29 mentation to ensure all infor- utive Jamie Dimon said the the unit’s lowest profit since mation is accurate. reserve wasn’t related to the 2008’s crisis-laden fourth “We are going file by file, foreclosure documentation is- quarter. More case by case,” said Chief Fi- sue. Trading revenues were 12x Throughput World Watch nancial Officer Doug Braun- The new foreclosure also expected to decline at A comprehensive rundown of stein. “If we made mistakes, moves overshadowed the Goldman Sachs Group Inc. and Less news from around the world. we fill fix them,” he said. bank’s announcement of $4.4 Morgan Stanley, putting pres- 50% Hardware Pages 30-31 Several other U.S. billion in third-quarter earn- sure on compensation around banks—including Bank of ings. The results were up 23% the industry. Goldman reports America Corp., Wells Fargo & from the year-ago quarter, Oct. 19 and Morgan Stanley Co. and Ally Financial Inc.’s surpassing analysts’ esti- reports Oct. 20. Editorial GMAC Mortgage—are scram- mates, but largely because it bling to review documents set aside less money for bad J.P. Morgan profit surges on & Opinion due to concerns about their loans. lower loss provisions ...... 17 oracle.com/exalogic use of what are known as Income in the investment Probe targets foreclosure Source: Performance testing using equivalent Support for Iran’s opposition workloads on Exalogic vs. third-party hardware can avoid a showdown with “robo signers” who approve bank was down 33% on company’s paperwork ...... 22 with comparable processors, memory, and storage. hundreds of foreclosure docu- weaker trading, and the bank Foreclosure delays could slow Tehran. Page 13 Copyright © 2010, Oracle and/or its affiliates. All rights reserved. ments a day. disclosed it cut compensation U.S. recovery...... 22 2 THE WALL STREET JOURNAL. Thursday, October 14, 2010 Thursday, October 14, 2010 THE WALL STREET JOURNAL. 31 PAGE TWO BUSINESS WATCH

iii set aside for loans that might go ter oil drilling in European waters, of next year. He was CEO of J.P. an event to announce Coal India’s Autos bad tumbled. J.P. Morgan, the first instead recommending new legis- Morgan Cazenove, an investment initial public offering. The govern- Feeling important in its own right What’s big bank to report results, said it lation to enforce tough new EU- bank that began as a joint venture ment is seeking to raise as much n The Obama administration had a third-quarter profit of $4.42 wide safety standards for the off- of J.P. Morgan Chase and Britain’s as 154.75 billion Indian rupees plans to allow higher levels of eth- billion, or $1.01 a share, up from shore oil and gas industry. Cazenove Absolute Equity. ($3.47 billion) through India’s While the government is keen News anol for gasoline used by newer $3.59 billion a year earlier. largest initial share sale ever. [ Agenda ] n n iii to harvest what cash it can from Some creditors of Anglo cars. The Environmental Protec- Mongolia Mining is looking for iii these sales, or at least, unburden Irish Bank are fiercely resist- tion Agency plans to announce it n A New York State Supreme acquisition targets in the Mongo- Manufacturing BY PATIENCE WHEATCROFT itself of some losses, there is also ing government efforts to will allow ethanol levels in gaso- Court judge dismissed a lawsuit lian resources sector following an Retail a hope that the sales might have them help pay for the line blends to be as high as 15% filed by investors who challenged initial public offering in Hong n China’s central governmentor- Being benefit productivity. bank’s bailout, complicating for vehicles made since 2007, up an $8.4 billion settlement in 2008 Kong that raised $650 million, ac- dered BYD to surrender 121 acres n Wal-Mart Stores announced important may not The unions that are protesting Ireland’s already fractious from 10%, according to two people between Bank of America and cording to its top executive. Mon- of land in the central Chinese city long-awaited plans to penetrate always be a good vigorously about the proposed banking-system rescue. 4 familiar with the matter. state attorneys general related to golia Mining, the country’s biggest of Xian land in a zoning dispute, a America’s largest cities with thing. Next month sale of Royal Mail are the same predatory-lending accusations. producer of coking coal, is the decision that is likely to slow the small- and mid-sized stores, as the the Financial unions that have so fiercely n Standard Chartered plans n BMW said it will boost annual first Mongolian company to list its Chinese battery and auto maker’s world’s largest retailer acknowl- Stability Board will resisted the modernization that to raise $5.15 billion in a production at its South Carolina n UBS is set to give shareholders shares in Hong Kong. push to expand in the nation’s edged that it was losing some put forward its proposals for the organization has badly rights issue to boost its capi- plant by 50% to 240,000 vehicles more insight into how it nearly growing auto market. China’s Min- lower-income consumers to com- dealing with those banks it judges needed. In the planned sale, at tal position as new global starting in 2011 in response to collapsed under the weight of bil- n Woodside Petroleum Chief Ex- istry of Land and Resources also petitors. to be “systemically important,” or, least a tenth of the shares will be banking rules take effect, in a world-wide demand for its sport- lions in toxic securities in 2008. ecutive Don Voelte will depart the hit BYD with a 2.95 million yuan iii in popular parlance, “too big to offered to Royal Mail staff and the move that global peers could utility vehicles. The German auto Australian oil and gas company ($442,000) fine, the ministry said. fail.” These will almost certainly hope is that employees who follow. 19, 32 maker builds the X5 and X6 SUVs n Standard Chartered plans to when it finishes building its 13 bil- Sports

include heavier capital Bloomberg News become shareholders might have a and now the X3 compact SUV at raise around $5.2 billion in a lion Australian dollar (US$13 bil- n Cidron Intressenter,afund requirements beyond those laid Peter Sands, chief executive of Standard Chartered. more positive attitude toward the n Porsche said its net loss the plant. rights issue to boost its capital lion) Pluto liquefied natural gas controlled by Jersey-based pri- n Liverpool Football Club could down in Basel III. business. narrowed sharply in fiscal position as new global capital project next year, a key develop- vate-equity firm Nordic Capital be sold to the owners of the Bos- Standard Chartered is not FSB. At the recent meeting of the full entitlement in the rights issue The network of Post Offices 2010 and it expects a return n Porsche reported its fiscal-year rules take effect. ment the 57-year-old has champi- VII, raised its bid for Swedish in- ton Red Sox within days after a boasting but it suspects that it Institute of International Finance and others will surely follow. The which is part of Royal Mail will to profitability in 2011. 17 net loss narrowed sharply to €454 oned from its conception in 2005. door humidity-control systems U.K. High Court judge ruled n will be one of those institutions in Washington, other bankers, company’s growth record over not be included in the sale but million ($631.8 million) compared Lloyds Banking Group said it iii maker Munters to 5.78 billion against the team’s current U.S. that the FSB judges to be including Deutsche Bank’s Chief recent years is one that may be turned into a mutual n A U.K. judge ruled against with €3.56 billion in the same pe- will cut 1,600 permanent jobs in Swedish kronor ($868.7 million) owners, Tom Hicks and George systemically important. With Executive Josef Ackermann, were shareholders will want to continue organization. This is a form of Liverpool FC’s owners, bring- riod a year earlier. its group information-technology Fashion trumping a bid from a rival. Gillett, in their battle to retain shareholder equity of about £30 cautioning national regulators to back. And although Mr. Sands ownership that the coalition ing the debt-ridden Premier iii and operations department by iii control of the English Premier billion ($47.6 billion), a presence against trying to race ahead of is adamant that he is not seeking government is enthusiastic about League club closer to being 2012. Some 1,150 temporary em- n Burberry Group reported an League club. in more than 70 countries and Basel. Such pleading is unlikely to a war chest to fund acquisitions, and is exploring in other areas of sold to the owners of the Aviation ployees and contractors in the 11% rise in second-quarter sales to Media iii profits of £3.12 billion in its last deflect regulators who, having well, at least he will be in a the public sector. The John Lewis Boston Red Sox. 20 U.K. and 1,750 offshore will also £382 million ($603.6 million), half year, it is a business whose failed to act in time to stop the position to add the odd bolt-on Partnership, a retailer with n The U.K. Court of Appeal ruled be cut, the U.K.-based bank said. from £343 million a year earlier. n Shares in Dogan, Turkey’s larg- Tech n collapse would have huge crash, are now keen to purchases if and when they 67,000 staff, each of whom is a Ukraine’s government will BAA must sell London Stansted iii est media company, rose sharply ramifications and which demonstrate their skill at become available. “partner,” is offering advice to issue corruption allegations Airport and either Edinburgh or n Société Générale said it will on local media reports that the n Intel said its third-quarter regulators might rightly judge slamming stable doors and bolting the government on a dozen against ex-Prime Minister Ty- Glasgow airport, as required by appeal a fine imposed in Septem- Financial services firm asked Goldman Sachs to ad- profit rose 59% to $2.96 billion, or would best be avoided. them tight. Is the check in the post? “pathfinder” experiments in moshenko on Thursday, a the country’s antitrust regulator. ber by the French competition au- vise it on plans to sell its media 52 cents a share, compared with a Hence Chief Executive Peter The U.K. government has taken mutualization, where public- move certain to step up ten- The ruling is the latest in a long- thority for fixing the price of n U.S. regulators proposed a rule units, even after Dogan said the profit of $1.86 billion a year ear- Sands thinks it likely that very the first step toward privatizing sector employees have been set up sions with opponents. 6 running dispute over the possible clearing checks electronically. that would require creditors of news was “speculative.” lier. Revenue rose 18% to $11.1 bil- soon his bank could be facing Mr. Sands does not wish to its postal service, launching as self-governing organizations to breakup of U.K. airport operator iii large financial firms to suffer iii lion from $9.4 billion. demands to increase its capital legislation for the move, which provide services. BAA, which is owned by Spanish losses in the event of a firm’s col- ratios. Mr. Sands does not wish to see his expansion plans will take place next year. But in The thinking is that by construction and infrastructure Defense lapse but left wiggle room for the Metals and mining n ASML Holding, a Dutch semi- see his expansion plans order to make Royal Mail at all allowing them the freedom to run company Ferrovial. U.S. to make payments to certain conductor-equipment maker, said constrained by enforced Inside n n constrained by enforced extra palatable to purchasers, the their own operations, they will iii Lockheed Martin said it has types of creditors. The proposal is Coal India is in talks with U.S. its third-quarter net profit rose to conservatism, so he is acting now, extra conservatism. business has first to be relieved of become more efficient and agreed to sell a risk and resource the first step in the government’s companies for investing in high- €268.5 million ($373.6 million) with a pre-emptive rights issue. its pension-fund deficit. creative in the services they Banks management business to Veritas effort to clarify how it will seize grade thermal coal assets, as part from €19.8 million in the same pe- By raising an extra £3.2 billion This is a whopping £10.3 billion provide and the way in which they Capital for $815 million. and dismantle large financial of its $1.2 billion acquisition plan, riod a year earlier as customers n now he will increase Standard Their demands, when they ($16.3 billion), symptomatic of the do so. The business model has J.P. Morgan Chase’s third-quar- iii firms that run into trouble. the state-run company’s chairman boosted their investments in chip- Chartered’s core Tier 1 capital to come, will force other institutions public-sector pension problem certainly worked for John Lewis, ter profit rose 23%, topping ana- said. The talks are in addition to making materials. The results 11%. Basel III called for a either to close to large amounts of that successive administrations one of the U.K.’s most successful lysts’ estimates, as the giant bank Energy n Lazard said it has appointed two proposals—one each from were ASML’s best-ever quarterly minimum of 7% plus a counter- business or tap the markets for have ducked. The taxpayer is retailers. Given the poor continued to see improvement at Naguib Kheraj to the new position Australia and Indonesia—short- figures. cyclical buffer of up to 2.5%. more capital. For a business such already saddled with the debt so performance of many public- its Main Street-related operations n The EU backed away from im- of chief executive of Lazard Inter- listed by Coal India for overseas Whether 11% will be enough to as Standard Chartered, with a is no worse off for holding it sector bodies, experimenting with and the amount of money being posing a moratorium on deepwa- national, effective the beginning investments, he told reporters at n Broadcom said it will pay $316 keep the regulators happy remains focus on the emerging markets directly rather than indirectly. the mutual model must be worth million to acquire Beceem Com- to be seen. The Swiss authorities and plentiful opportunities Royal Mail is just one of the trying. munications, a closely held pro- are imposing much stricter beckoning in China, India, state-owned organizations now Children face aftermath of Hungary red sludge spill vider of semiconductors used to demands on their banks, but then Indonesia and the like, being likely to come under the hammer Lazard lands Kheraj Studying star athletes help power products for fourth- between them UBS and Credit forced to walk away from as the government embarks on a Ever since he signaled the end can bring us out of a generation wireless networks. Suisse are five times the size of opportunities would be too new wave of privatizations. Other of his stay at J.P. Morgan, there the Swiss economy. That really painful to contemplate. Mr. Sands likely candidates are the Royal has been speculation about where slump at the office. 27 n NEC said it will spend 100 bil- does make them too big to be has therefore wisely decided to Mint, which is the world’s largest Naguib Kheraj might land next. As lion yen ($1.2 billion) between allowed to fail. jump ahead of any fund-raising exporter of coins and medals, as chief executive of Lazard now and March 2013, mainly in its Mr. Sands does not believe that queue. well as being the provider of the International, and a deputy cloud computing and overseas in- the Swiss will be the only ones to His major investor, Temasek, U.K.’s currency, and gambling chairman of the firm, he appears formation technology service op- move harder and faster than the has already agreed to take up its organization, the Tote. to have found his ideal role. erations, as the Japanese IT giant seeks new sources of revenue amid sluggish growth in its do- ONLINE TODAY mestic market. iii Most read in Europe Iain Martin on Politics Continuing coverage Question of the day Telecommunications blogs.wsj.com/iainmartin Vote and discuss: Do you n Egypt’s telecommunications ‘Ed Miliband needed agree with the Obama Double talent: Tennis regulator has set new rules for star is also a top companies sending text messages to put in a good administration’s decision to multiple mobile phones, in a to resume off-shore deep- sports agent. 28 move activists say will stifle ef- forts to mobilize voters ahead of performance at his water drilling? upcoming parliamentary elections. Vote online today at wsj.com/polls THE WALL STREET JOURNAL EUROPE iii first Prime Minister’s (ISSN 0921-99) Commodity Quay, East Smithfield, Transportation Questions and he Previous results London, E1W 1AZ 1. Ibiza Bachelor Pad SUBSCRIPTIONS, inquiries and address changes to: n Vietnam appointed Nguyen Q: Should Wall Street Telephone: +44 (0) 20 3426 1234. Calling time from 2. Two-Speed Europe Coming delivered.’ 8 a.m. to 5 p.m. GMT. E-mail: [email protected]. Ngoc Su, a senior executive at the Down the Line firms be required to cut Website: www.services.wsje.com nation’s state-run petroleum gi- ADVERTISING SALES worldwide through Dow Jones 3. ‘Scrapers’ Dig for Data on Web back on compensation to International. Frankfurt: 49 69 29725 390; ant, as chairman of Vietnam Ship- 4. Opinion: Ayaan Hirsi Ali: In London: 44 203 426 1111; Paris: 331 40 17 17 01. building Industry Group, which Printed in Belgium by Concentra Media N.V. Printed in Holland, Free Speech on Trial preserve returns on equity Germany by Dogan Media Group / Hürriyet A.S. Branch has fallen under scrutiny after the 5. Wall Street Pay Hits New High for shareholders? Germany. Printed in Switzerland by Zehnder Print AG Wil. arrests of top managers showed Printed in the United Kingdom by Newsfax International the potential vulnerability of Viet- Ltd., London. Printed in Italy by Telestampa Centro Italia Most emailed in Europe s.r.l. Printed in Spain by Bermont S.A. Printed in Ireland nam’s state-controlled corporate 1. Land Bet Besets D.E. Shaw Yes by Midland Web Printing Ltd. Printed in Israel by The champions. Get rapid-fire analysis of Jerusalem Post Group. Printed in Turkey by GLOBUS 2. Wall Street Pay Hits New High 62% Dünya BasInevi. 3. Opinion: Ayaan Hirsi Ali: In the day’s big business and Registered as a newspaper at the Post Office. WSJ.com Holland, Free Speech on Trial No Trademarks appearing herein are used under license from finance stories at Dow Jones & Co. ©2010 Dow Jones & Company. All Reuters 4. Ibiza Bachelor Pad 38% rights reserved. Editeur responsable: Patience Wheatcroft To read more about these items, 5. Using iPad for Speech Therapy blogs.wsj.com/source M-17936-2003. Schoolchildren in the village of Devecser wear protective goggles and masks to protect against dust from dried toxic mud. A judge released the head of the Registered address: Boulevard Brand Whitlock, 87, 1200 and for all the latest breaking Brussels, Belgium company whose alumina plant’s storage pool partially collapsed and flooded three towns in western Hungary with 700,000 cubic meters (184 million gallons) of news,gotoWSJ.com/Business caustic sludge last week. It killed nine people and made hundreds of homes uninhabitable, but the judge rejected prosecution claims to file a negligence charge. 30 THE WALL STREET JOURNAL. Thursday, October 14, 2010 Thursday, October 14, 2010 THE WALL STREET JOURNAL. 3 WORLD WATCH NEWS Romanian public employees protest wage cuts, part of austerity measures EU decides against deep-water drilling ban

BY GUY CHAZAN try has one of the most robust one in the Gulf of Mexico will never 200 nautical miles from the coast. safety review of all oil and gas oper- safety and regulatory regimes in the happen in European waters. This is Such measures could have reper- ations in European waters. The European Union backed away world. The European Parliament also why we propose that best practices cussions for the European oil indus- While eschewing an outright call from imposing a moratorium on rejected the proposal in a vote last already existing in Europe will be- try. Most oil exploration is carried for a ban, the commission called on deep-water oil drilling in European week. The U.S. lifted its own morato- come the standard throughout the out in relatively shallow waters, but member states to consider suspend- waters Wednesday, instead recom- rium on deep-water drilling in the European Union.” oil companies are increasingly mov- ing the licensing of new oil and gas mending new legislation to enforce Gulf of Mexico on Tuesday. Under the measures being put ing into the deep offshore areas, operations until Europe’s offshore tough new EU-wide safety standards Instead of a ban, the European forward, member states issuing such as the remote basins west of safety regimes had been fully as- for the offshore oil and gas industry. Commission, the EU’s executive arm, drilling licenses would ensure that Shetland and in the Black Sea off the sessed. The EU’s power to intervene Günther Oettinger, the EU’s com- recommended on Wednesday a “sin- oil companies met key EU require- coast of Romania. There are nearly in such matters is limited, since oil missioner for energy, had called for gle new piece of specific legislation ments, had contingency plans in 900 offshore installations operating licenses are awarded by national a temporary ban on offshore drilling for offshore oil and gas activities,” place and the financial means avail- in the EU. governments. Even that softer for- in sensitive areas until the causes of including criteria for granting drill- able to pay for any environmental After the Deepwater Horizon rig mula provoked an angry response the Gulf of Mexico oil disaster had ing permits and control of rigs. damage caused by accidents. In the exploded and sank in the Gulf of from Oil & Gas UK, the British oil in- been fully investigated. But the idea “Safety is non-negotiable,” Mr. event of a spill, companies would Mexico in April, killing 11 and trig- dustry’s main trade body. Its head was dismissed by the U.K., which ar- Oettinger said. “We have to make also be responsible for cleaning up gering the worst offshore oil spill in Malcolm Webb called the idea of a gued its domestic oil and gas indus- sure that a disaster similar to the damage to the natural habitat up to U.S. history, the EU launched a suspension “wholly unjustified.”

Associated Press A Romanian government official seeks to calm employees of the Finance Ministry after a rowdy spontaneous demonstration in Bucharest. Many civil servants have had their salaries slashed by over 25%.

iii due to the strikes. the military, rather than to see the cial and a second official. other died in the south in a sepa- Europe ban repealed by court order. rate roadside bombing. n In Italy, police detained 17 peo- n China’s foreign-exchange re- n The number of Britons claim- ple including the alleged ring- n An Armenian-American orga- serves swelled by $194 billion in n Iranian President Mahmoud ing unemployment benefits rose leader of rioting at a football nized crime ring based in New the third quarter, a record gain Ahmadinejad offered Lebanon his in September for a second match between Italy and Serbia. York and Los Angeles allegedly that highlights the extent of the country’s support in fighting what straight month, and the jobless The game in Genoa was aban- bilked a federal health-care pro- nation’s intervention in currency he views as detrimental U.S. and rate appears set to rise further as doned after Serbian fans threw gram for tens of millions of dol- markets. Israeli influence in the Middle cuts in public sector spending hit flares and fireworks onto the lars using stolen doctor and pa- East, kicking off his first state private sector companies. The pitch, burned a flag and broke tient identities, law-enforcement n A group of Chinese Communist visit there with a provocative claimant count measure of unem- barriers. The Union of European authorities said. Party elders has written an open message that cuts to the heart of ployment rose by 5,300, resulting Football Associations warned letter calling for an end to restric- the political disputes threatening in a jobless rate of 4.5% sanctions could be as serious as n In Washington, D.C., schools tions on freedom of expression, in the fragile coalition government. disqualification from the Euro- chancellor Michelle Rhee an- the latest sign of an internal de- n The U.K. government took the pean Championship or exclusion nounced her resignation, ending a bate about political reform in n Iran said 18 members of the first step towards privatization of from future competitions. stormy tenure that brought her China. The letter signed by 23 el- powerful Revolutionary Guard the national postal service as it national attention as a tough- ders—mostly known reform- were killed in an explosion that announced a bill which, if made n Industrial production across minded superintendent willing to ists—was quickly removed after struck the force’s base in the law, would allow the government the 16 countries that share the take on the teacher’s union. appearing on a Chinese microb- country’s west. to sell shares in Royal Mail for the euro rose more than expected in iii logging site Tuesday, but is now iii first time. The bill would safe- August, a sign that the sector con- circulating widely outside China’s guard public ownership of the tinued to support the economic Americas Internet firewall. Middle East country’s post offices. recovery in the third quarter, offi- cial figures showed. Euro-zone in- n In Chile, more than half of the n Bank of Japan Governor n France’s Foreign Ministry is n Britain’s foreign secretary dustrial output grew 1% from July 33 miners who had been trapped Masaaki Shirakawa hinted the asking family members of French made his first visit to Russia since and was 7.9% higher than in Au- deep underground for 69 days had central bank may expand its re- people working in Yemen to leave taking up his post, where he gust a year earlier, the Eurostat been rescued as of Wednesday af- cently announced 5 trillion yen the country as a result of the “de- stressed that both countries were statistics office said. ternoon. Chilean President Se- ($61.1 billion) program to pur- terioration of the security situa- trying to overcome a dip in rela- iii bastián Piñera said the rescue chase a range of financial assets. tion there.” tions since an ex-Russian security could wrap up faster than antici- iii officer was poisoned in London in U.S. pated. At the current pace of a n South Korea launched its par- 2006. William Hague said London miner surfacing every 40 minutes, ticipation in a U.S.-led coalition to Africa and Moscow need to cooperate in n Many of the largest U.S. munic- the operation could end Wednes- intercept ships suspected of dealing with global security chal- ipalities are understating the true day evening, he said, rather than spreading weapons of mass de- n Sudan’s foreign minister said lenges despite tensions between size of their pension obligations on Thursday as first expected. struction, risking the anger of ri- though the state is opposed to the two following Alexander Lit- by using inappropriate accounting iii val North Korea, one of the coun- splitting up the country, it “won’t vinenko’s death. methods, leading to $574 billion tries targeted by the program. object” if southerners vote for in- of unfunded pension liabilities, ac- Asia North Korea has long warned it dependence in a referendum. n In France, worker protests cording to a study. Those un- would consider Seoul’s participa- against President Nicolas funded pension benefits are in ad- n In Afghanistan, U.S.-led inter- tion in the Proliferation Security n In South Africa, civil-service Sarkozy’s plans to increase the re- dition to $3 trillion of unfunded national forces have been helping Initiative as a declaration of war unions accepted the government’s tirement age reached a turning liabilities that the study’s authors to facilitate preliminary contacts against the North. wage offer. Every journey began in Africa. point as labor unions tried to or- have said exist among state pen- in Kabul between President Hamid Ali and Bono wear Edun; Ali carries the Louis Vuitton/Edun collaborative bag. chestrate crippling, open-ended sion plans. Karzai’s government and Taliban n Also in Afghanistan, insurgents strikes—with mixed results. Mobi- representatives in move that sig- killed six NATO service members, WSJ.com lization showed signs of fizzling n Defense Secretary Robert nals a shift by the U.S. to more ac- including four who died in a sin- Profits from the bag, as well as Ali and Bono's fee benefit Conservation Cotton Initiative Uganda. out among public-transport em- Gates said he would strongly pre- tive support of Afghan reconcilia- gle bomb blast in the volatile To read more about these items, Follow Ali and Bono on louisvuittonjourneys.com ployees. Still, all French refineries fer legislative action by Congress tion efforts. The previously south of the country. One service and for all the latest breaking but one either halted output or to repeal the policy that bans ho- undisclosed Western assistance is member was killed in the east in news,gotoWSJ.com/World were working at minimum levels mosexuals from serving openly in described by a senior NATO offi- an attack early in the day, and an- 4 THE WALL STREET JOURNAL. Thursday, October 14, 2010 Thursday, October 14, 2010 THE WALL STREET JOURNAL. 29 EUROPE NEWS THE QUIRK Ireland’s Cowen When a bagel’s really an obwarzanek

BY LAURA STEVENS smaller bakery in the U.S.,” she Krakow, Poland says. seeks consensus What worries Mr. Lewandowski T’S round, has a big hole in the and his fellow Krakow bakers is BY QUENTIN FOTTRELL victory in the next election. center and is made of thick, that without the EU designation, A general election is due in 2012, I chewy dough. But don’t call it “counterfeiters” across Poland DUBLIN—Irish Prime Minister but many observers expect it early a bagel. Bagels are just “rolls with have started selling the obwar- Brian Cowen has written to the next year. The Fianna Fail-led coali- a hole in them,” says Polish baker zanek. An official seal would pre- leaders of the main opposition par- tion government is in third place Robert Lewandowski. “This,” he sumably prevent imitators from ties seeking a meeting, with the ob- behind Fine Gael and the Labour says, holding up one of the cre- trying to pass off their product as jective of creating a cross-party Party in recent public opinion polls. ations in his bakery, “is an obwar- the real Krakow specialty, and consensus on the government’s pro- Observers say the inspiration for zanek krakowski.” they could be prosecuted under posed four-year budgetary plan, his this goes back to Ireland’s last eco- Mr. Lewandowski is one of a the law. Mr. Lewandowski owns a department said Wednesday. nomic crisis in the 1980s. In 1987, band of Krakow bakers pushing small factory that produces about A government spokeswoman, re- when the government’s debt stood the European Union to designate 20,000 obwarzanek every night. ferring to Mr. Cowen’s letter, said, at 112% of GDP, Alan Dukes, the their round bread a regional spe- Employees shuffle around the “He believes that the pursuit of the then-leader of Fine Gael, decided to cialty, placing it alongside Chianti flour-covered floor in shorts and national interest and common good back Fianna Fail’s budget cuts. Mr. Classico olive oil, Camembert de flip flops, mixing the yeasty must have priority at this time.” Dukes’s initiative became known as Normandie and Prosciutto di dough, letting it rise, rolling it out The government aims to cut the the Tallaght Strategy after the south Parma in the pantheon of Old and cutting it with a machine. country’s budget deficit to 3% of Dublin suburb in which it was an- World delicacies. Next, about 10 workers around gross domestic product by 2014, as nounced. But there’s a problem: Most a table in the warm room take previously agreed with the Euro- The government went on to people think the obwarzanek (pro- two pieces and twist them into pean Union, from an expected 32% make deep cuts to public-sector nounced obe-var-jon-eck) is just a rings at lightning speed. Two men of GDP this year due to the cost of spending, paving the way for the bagel. “They look pretty much the stand at a tank of boiling water, Bloomberg News the country’s bank rescue, estimated economy’s revival in the 1990s and same, and both are based on a dropping in the dough for about a Finance Minister Brian Lenihan has said subordinated bondholders should suffer losses to help pay for the bailout. at €50 billion ($70 billion) in a its subsequent transformation into pretty simple premise,” says minute, taking it out and dipping worst-case scenario. the “Celtic Tiger.” However, Fianna Patrick Vaughan, a 45-year-old it in toppings, then placing the “We’ve received a letter, but we Fail was narrowly returned to power American who has been living in creations on baking racks that are haven’t had time to consider it yet,” in 1989 as part of a coalition. It then Krakow for about 10 years. “It’s rolled into two huge ovens. said a spokesman for the opposition went on to govern for 17 of the fol- pretty hard to change the taste of The bread was originally baked Fine Gael party. lowing 21 years. basic baked bread. That recipe has only during Lent. Now it is sold in AngloIrishcreditors A spokesman for the Labour These days, some observers say been around for a while.” shops, bakeries and about 180 Party also said Mr. Cowen has in- opposition parties have much to The Krakow bakers, who have street carts, with daily production vited party leaders to a meeting to lose and little to gain by entering been lobbying Brussels to recog- of about 150,000. The obwarzanek discuss the budget, but said it is too talks and say they are wary of being nize the obwarzanek ever since is used in ads meant to attract early to form a response yet. tainted by agreeing to four years of Poland joined the European Union tourists to the city and adorns the fightgovernmentplan John Gormley, leader of the brutal tax increases, along with pen- in 2004, point to numerous mo- doors of city-endorsed restau- Green Party, junior coalition partner sion and social-welfare cuts that ments in history, beginning in rants. A fabric version of the deli- of Mr. Cowen’s party, Fianna Fail, could yet see the Irish public take to 1394, that they say prove the Kra- cacy won second place in a 2004 BY NEIL SHAH ers to take a loss while the banks tracted stand-off with creditors last week called for leaders of the the streets in protest, as voters have kow bread’s singularity. competition to pick the best sou- continue to operate as state-owned could end up further tarnishing Ire- main parties to meet before the done in Greece and Iceland. The evidence includes a 1496 venir from Krakow. A group of Anglo Irish Bank entities. land’s reputation as a global capital government’s four-year budgetary The government spokeswoman decree from Polish King John Al- Little blue-and-yellow obwar- Corp. creditors is fiercely resisting An acrimonious legal battle magnet. plan is due in early November. said of Mr. Cowen’s letter Wednes- bert that gave certain baking zanek stands dot nearly every government efforts to have them would be debt-ridden Ireland’s latest “This issue needs to be dealt Mr. Cowen has already ruled out day: “He believes it would send a rights of white bread, including street corner in downtown Kra- help pay for the bank’s bailout, com- black eye. Last month, its central with sooner rather than later,” said establishing an all-party national strong signal to our European Union obwarzanek, to Krakow bakers. In kow. Lucyna Biedo, a 59-year-old plicating Ireland’s already fractious bank said it could cost the govern- Michael Cummins, a director at Dub- government to deal with Ireland’s colleagues and international mar- addition, there was a decree is- woman with a round face and banking-system rescue. ment as much as €50 billion to bail lin-based fixed-income firm Glas Se- economic crisis, but has said he had kets that the main political parties sued in 1611 from the Krakow bak- smiling eyes, runs one of them. Investors holding roughly €500 out Irish banks, a bill that is driving curities. “There needs to be less “no problem” with consultation be- here are at one in their determina- ers’ guild authorizing the regula- She says she has been in the same million ($695.8 million) of Anglo Ireland’s budget deficit to 32% of its speculation and headlines regarding tween political parties. tion to achieve that objective and to tion of obwarzanek sales inside spot for 15 years and sells about Irish’s riskiest bonds—about one- gross domestic output this year, the subordinated and senior bank debt However, opposition leaders do so in line with the commitments the city, as well as granting the 150 obwarzanek from her cart ev-

fifth of such debt—are challenging highest for any member of the euro and more focus on the real economic have reacted with skepticism, in that this government has made in guild the right to decide who was ery day for 1.40 Polish zloty, or Laura Stevens/The Wall Street Journal the government’s position this week zone since the currency was challenge ahead.” public at least, to the government’s the context of our membership of allowed to sell it. about 50 U.S. cents. Lucyna Biedo sells about 150 obwarzanek from her cart in Krakow every day. She has been in the same spot for 15 years. in meetings being run by investment launched in 1999. But Anglo Irish’s creditors likely overtures. They are confident of a the euro zone.” Obwarzanek, which comes Like other obwarzanek lovers, bank Houlihan Lokey, according to a To placate investors and ratings face an uphill battle. Finance Minis- from the Polish word “to boil,” are Ms. Biedo is steeped in the bread’s person involved in the efforts. firms, Ireland will unveil a four-year ter Brian Lenihan has repeatedly bigger than bagels, and are woven lore. She recounts the tale of a Another group of investors hold- budget plan next month showing said the bank’s subordinated bond- from two strands of dough, in- group of Polish soldiers who are ing debt of nationalized Irish Na- how it will cut spending and raise holders should suffer losses to help stead of one. The obwarzanek has said to have beaten back a Ger- tionwide Building Society is also taxes to reduce its deficit to the Eu- pay for the bailout. Anglo Irish’s “se- Hungary sets new taxes a diameter of 4.7 to 6.7 inches man onslaught in 1410 after scarf- trying to mobilize in order to secure ropean Union limit of 3% by 2014. nior” bond investors, who rank (12-17 centimeters), weighs about ing obwarzanek. a stronger bargaining position ahead Ireland’s treatment of bond in- higher in a liquidation, will be hon- 4 ounces and has a “sweetish Krakow’s campaign for the ob- of any negotiations with the govern- vestors could set a precedent for fu- ored in full, he has said. to address deficit target taste,” according to Poland’s appli- warzanek started several years ment over losses. Irish Nationwide ture debt restructurings of bonds is- Anglo Irish’s subordinated bonds cation filed with the EU. ago, after Kazimierz Czekaj, a has €184 million in risky “subordi- sued by nationalized banks. Dublin are trading at a fifth of their original BY VERONIKA GULYAS panies’ 2009 results. The bread, which, like a bagel, baker here, noticed that foreign- Powered by EXECUTIVE LEARNING PARTNERSHIP nated” debt. officials hope to reduce their bank- value, suggesting investors’ own The IMF and the European Union is boiled before it is baked, can be ers and even the local press were Bondholders are growing anxious bailout costs by getting holders of hopes are low. A spokesman for Ire- BUDAPEST—Hungarian Prime walked away from loan talks with sprinkled with salt, sesame seeds, increasingly referring to the bread that they will be forced to take Anglo Irish’s subordinated bonds to land’s National Treasury Manage- Minister Viktor Orbán said the Hungary in July in part because poppy seeds, mixed herbs or as a bagel. “I said, ‘Enough of losses on their holdings as part of voluntarily sell their €2.4 billion of ment Agency couldn’t be reached. country will rely on temporary new they worried Mr. Orbán’s govern- spices, cheese or onion. Unlike ba- this,’” says Mr. Czekaj. It was Mr. the broad government bailout effort. debt back to Ireland at a hefty loss, Many observers expect Ireland to taxes on telecommunications and ment was relying too much on tem- gels, the dense and chewy obwar- Czekaj who pushed Poland to reg- They argue that the government has resulting in a multibillion-euro gain avoid having to force losses on in- energy companies and supermarkets porary measures, including a large zanek aren’t toasted or cut in half ister the obwarzanek krakowski as no legal standing to force bondhold- for the government. However, a pro- vestors by offering to buy back the as the government struggles to temporary tax on banks, to meet its to make sandwiches. “The reputa- a regional specialty with the Euro- The WSJE Future Leadership Summit subordinated bonds for a price meet budget-deficit targets required budget targets instead of making tion of obwarzanek krakowski has pean Union several years ago, af- slightly higher than their current by the European Union. longer-lasting changes to state been cultivated by bakers from ter persuading his fellow bakers BREE/SCHILdE SUmmIT Brief relief? market value, a move Anglo Irish In a speech Wednesday, Mr. Or- spending programs. Krakow and the surrounding ar- to join the cause. Then he con- Ireland’s bond yields have fallen recently, but more troubles could be looming. also made in 2009. bán, who has pledged not to imple- As it moves to hold this year’s eas, who have been making this ducted the research and wrote up “People might make a public pro- ment further austerity measures in budget deficit to 3.8% of gross do- exquisite and unique product for the application, which he submit- Belgium 2010 test, but deep down surely they’re his recession-hit country, outlined mestic product and next year’s gap the people of Krakow for the last ted to the Polish government in Irish 10-year government Annual cost to insure $10 million rd bond yield of Irish government bonds against not expecting to get 100% back ei- his administration’s plans to shrink to 3% of GDP, the government will 600 years,” the application notes. 2007. The application made it to 3 Nov: Bree ther,” said Cambiz Alikhani, partner the budget gap enough to win the also suspend government payments Maria Balinska, author of “The the European Commission in default for five years th at London-based asset manager confidence of skeptical financial into private pension funds from No- Bagel: The Surprising History of a 2008. 4 Nov: Bree 7% $500,000 Iveagh Ltd., who doesn’t own any markets. vember until the end of next year, Modest Bread,” disputes the idea The EU’s final decision is ex- th Irish bank bonds. Investor willingness to fund Hun- Mr. Orbán said. that the obwarzanek has a distinct pected shortly. Poland has reason 5 Nov: Schilde Ireland is also working on legis- gary’s debts is critical because Mr. The details of the pension mea- origin. She says the two breads for optimism, because no one has Townhall Bree, Belgium Castle Axel Vervoordt, Schilde, Belgium 400,000 lation that could force losses on in- Orbán has said he won’t seek a new sure weren’t immediately clear. It started off as pretty much the filed an objection. To Ms. Balin- 6 vestors if the buyback doesn’t work loan package from the International wasn’t expected to affect pension same thing, but with different ska, the historian, the question of The Wall Street Journal Europe Future Leadership Institute invites student leaders from out. Monetary Fund, which would have payments, but is aimed at tempo- names in Yiddish and Polish. She whether the bagel or obwarzanek 300,000 Analysts said how Ireland re- provided a safety net for the coun- rarily reducing the deficit-widening interviewed older Krakow resi- came first misses the point. Both Europe’s top business schools and universities to come together in Belgium to meet solves the subordinated debt issue try’s finances. impact of a revamp of the country’s dents as part of her research, who breads, she says, most likely de- 5 internationally renowned business and thought leaders. could have ripple effects for similar Details of the government budget pension system. said the two breads were indistin- rived from a white, braided Ger- 200,000 debt instruments issued by banks are expected to be released Monday. Hungary and other countries guishable as recently as the 1930s. man specialty—the pretzel. across the globe. “Whatever action But Mr. Orbán said levies on tele- that are shifting to privatized pen- “There’s a shared history, and is taken…will be seen by the markets coms, energy and supermarket busi- sion funds have asked the EU to at one point I’d argue they were 4 WSJ.com 100,000 and the ratings agencies as setting a nesses would raise 161 billion forint, change the rules for how the costs synonymous, but today… [the ob- www.wsje-flp.com 2010 2010 precedent,” Simon Adamson, a bank- or about $818 million, annually of the revamp are accounted for in warzanek is] a very different ONLINE TODAY: Read a recipe for [email protected] Sources: Thomson Reuters (Irish bond yield), Markit ing analyst at research firm Credit- through 2012. He said the taxes their budgets. The EU hasn’t re- product than what you’d get at obwarzanek at WSJ.com/World Sights, said in a recent report. would be calculated based on com- sponded yet. Dunkin’ Donuts or even at a 28 THE WALL STREET JOURNAL. Thursday, October 14, 2010 Thursday, October 14, 2010 THE WALL STREET JOURNAL. 5 SPORT EUROPE NEWS A ski-binding pioneer blade production, the company’s ’80s the future lay in producing [ Remembrances: first important innovation. complete equipment packages, led Georges Salomon In the early 1950s, he acquired Salomon to develop its own line of a disused patent for a new kind of skis, introduced in 1990. 1925-2010 ] ski binding and worked on Mr. Salomon and his family improvements. He introduced his sold Salomon to Adidas in 1997 in BY STEPHEN MILLER first toe-release system in 1955, a deal valued at $1.5 billion. Many and a series of technical analysts attributed the high price Georges Salomon perfected the innovations followed, including to Salomon’s earlier acquisition of modern ski binding, saving “Le Lift,” the first Salomon Taylor Made, a golf-equipment countless leg and knee injuries binding that replaced the maker that Adidas held on to and made Alpine skiing safe for traditional leather binding straps. when it sold Salomon to Finland- beginners and racers alike. In 1962, he introduced the based Amer Sports in 2005.

European Pressphoto Agency After creating his toe-release Allais safety binding, named for Miguel Ángel Jiménez. and cable-heel binding systems, the French Alpine skiing champion Mr. Salomon went on to expand of the 1930s. At the 1966 Alpine Mr. Salomon and his family Tip of the day Salomon into a global ski brand World Ski Championship in that produced boots, skis and Portillo, Chile, French skiers with sold Salomon to sport giant skiwear, as well as golf clubs. Salomon bindings dominated. By Adidas in 1997 in a deal Europe’s victorious Ryder He died Oct. 5 at age 84 at his 1972, Salomon claimed the world Cup team will be well home on Lake Annecy in Haute- market for ski bindings with more valued at $1.5 billion. represented at the Portugal Savoie in France, not far from than a million sold annually. Masters on Thursday, with at slopes in the French Alps. The company ventured into least four members of the Originally a schoolteacher, Mr. skiwear and then boots, creating A recreational skier, Mr. winning squad scheduled to Salomon set up a workshop in the rear-entry ski boot—which Salomon tested and honed his appear at the Oceanico Victoria Annecy with his father, a saw- was in vogue in the mid-1980s products. His shock of white hair Golf Club in the Algarve. blade manufacturer, and in 1947 among novice skiers who sought and easy manner invited Ross Fisher is the 14/1 they began producing sharp metal more comfortable gear. comparisons to philosophers and favorite ahead of the Molinari edges for a nascent postwar Professionals, however, rejected ski bums, but his aggressive

brothers, Francesco and Delessard/Neco/Sipa Alpine ski industry. Mr. Salomon the boots’ looser fit. innovation belied such talk. Edoardo, who are available at Georges Salomon perfected the ski binding and built a global brand. developed machinery to automate Mr. Salomon, predicting in the —Email [email protected] 22/1 and 25/1 respectively. Miguel Ángel Jiménez, who cemented his reputation as arguably the most popular © 2010 SunGard, all rights reserved. Trademark information: SunGard, the SunGard logo and the products and services of SunGard golfer on the European Tour at named herein are trademarks or registered trademarks of SunGard Data Systems Inc. or its subsidiaries in the U.S. and other countries.

Agence France-Presse/Getty Images Celtic Manor, is 22/1 with Mahesh Bhupathi, right, with his men’s doubles partner, Leander Paes. Off court Mr. Bupathi is developing his talent management company Globosport. Sportingbet. Whether any of this quartet can repeat their Ryder Cup heroics here is doubtful, however. Álvaro Quirós won Champion turns talent agent here as an 80-1 shot in 2008 and certainly has a chance this time around. The 4/5 with India’s greatest tennis player wants to manage the nation’s biggest stars Extrabet for the Spaniard to beat his countryman Mr. BY AMOL SHARMA for clients with big Indian and mul- Paes in the late 1990s and early Group. “It’s not a business that’s Jiménez is too good to tinational brands. 2000s, en route to a No. 1 doubles easy to scale up,” Mr. Bhupathi said. miss—Mr. Jiménez has finished NEW DELHI—Indian tennis star “If I push my tennis career to the ranking. Both have separately had The competition is fierce. Ms. no higher than 38th in his last Mahesh Bhupathi was cheering fel- Olympics, so be it, but after that I’m success with other partners and in Nehwal, who will compete in the three visits to this course. low countryman Somdev Devvarman here [in India] full-time and I can mixed doubles. Commonwealth Games ladies final Still, as an outright bet at as he won the gold medal in men’s build as many relationships as I Mr. Bhupathi is critical of the Thursday, left Globosport for Dec- 16/1, Mr. Quirós should probably tennis at the Commonwealth Games want,” the Chennai native said re- government’s lack of support for can Chargers Sporting Ventures be ignored: There is better on Sunday. Now Mr. Bhupathi wants cently over breakfast at a New Delhi tennis, saying there’s no real system Ltd., because they made a better of- value available further down the to do business with the young hotel. In a sign of how he’s multi- in place to develop young talent. fer, and one of the owners is a for- list, such as Alexander Noren, champion. tasking between tennis and business, “With the number of people we have mer badminton player, according to who stands out as a good Regarded as one of the best dou- he was flipping through a movie in this country and the amount of a person familiar with the matter. each-way choice at a general bles tennis players ever, Mr. Bhu- script just before the interview. talent we potentially have, a little A graduate of the University of 30/1. The Swede has finished pathi is known for his accomplish- The New Delhi Commonwealth support will go a long way,” he said. Mississippi, Mr. Bhupathi doesn’t 12th, 16th and 6th in his last ments on the court, including 11 Games have been a mixed bag for In his spare time, Mr. Bhupathi have a business background, but is a three appearances in this event Grand Slam titles. He’s a sports hero Indian tennis. Mr. Devvarman’s vic- has launched a nonprofit organiza- voracious reader of autobiographies and finished third in the in India and an outspoken critic of tory was a cause for celebration, but tion that has raised money to install by business moguls like Virgin Group Austrian Open last month. The the Indian government’s lack of fi- Ms. Mirza’s loss in the ladies singles 250 tennis courts in India. But his Chairman Richard Branson. He culti- 28-year-old is an underachiever nancial and organizational support final and Mr. Bhupathi’s own semifi- focus off the court is increasingly vated a relationship with former In- on the European Tour, so rather for its athletes. nal loss with longtime doubles part- Globosport, which he started in 2001 fosys Technologies Chief Executive than backing Mr. Noren But the 36-year-old also hopes to ner Leander Paes were both big dis- when he saw a dearth of sports- Nandan Nilekani after a chance en- outright, selling his finishing make a mark in the corporate world appointments. management expertise in India. counter on a plane and considers In- position at 40 with Sporting through Globosport, a management Mr. Bhupathi said he and other “He’s a great guy and has done dian telecom tycoon Sunil Bharti Index looks most appealing. company for athletes and movie players were looking forward to the extremely well,” said Suvrangsu Mittal one of his corporate heroes. stars he’s built up in recent years. Delhi Games for years and have Mukherjee, head of India operations Mr. Bhupathi stumbled into Bol- He represents India’s top women’s been “pleasantly surprised” with for sports marketing firm Total lywood because some of the market- tennis player, Sania Mirza, and Bol- how the 71-nation event has gone, Sports Asia, which is licensing the ers he was working with were inter- lywood film star Saif Ali Khan, and especially after a lead-up fraught Commonwealth Games brand to ested in partnering with actors. Mr. he’s targeting emerging celebrities with construction delays, health is- companies in India. “What he’s Khan was a client before he became lsuch as Mr. Devvarman. sues and other problems. But he missing is organizational support a star with films like “Dil Chahta Mr. Bhupathi has already had doesn’t pull punches criticizing the from a multinational point of view. Hai.” Mr. Bhupathi said he found 3 some setbacks in the cutthroat Indian government, saying their But he’s one of the pioneers of there isn’t yet a lot of money in In- world of Indian talent management, procrastination on getting ready for sports marketing in India.” dian sports outside cricket, which which he said is valued at only the event scared away top athletes. Mr. Bhupathi signed up Ms. marketing professionals say is the about $200 million. A few of his col- Top tennis players didn’t come Mirza when she was 15, two years case across Asia. The hugely popular leagues have left to start competing to New Delhi, including world No. 4 before she won her first big tourna- film industry was a natural target. firms and have taken with them cli- Andy Murray of Scotland and Lley- ment. “That was her big break and Mr. Bhupathi hopes to sign 25- ents like Bollywood power couple ton Hewitt of Australia. In track- it was our big break,” Mr. Bhupathi year-old Mr. Devvarman, the world’s Kajol and Ajay Devgan. He has had and-field, several of the fastest men said. “We were able to open a lot of No. 95 ranked singles player, when trouble maintaining relationships in the Commonwealth didn’t come. doors [with brands] because a lot of his current contract runs out with with celebrities while he’s been on “We’re all here enjoying the people wanted to sign her up.” Lagardère Unlimited, the firm that tour. Badminton star Saina Nehwal Games because they’ve managed to Though he didn’t disclose his manages U.S. star Andy Roddick. was once in his stable but left for pull off a last-minute great effort, firm’s financials, Mr. Bhupathi said Mr. Bhupathi said he knows he LOO OR S wherever learning takes place. We provide WHEREVER THE MISSION IS CRITICAL other representation last year. but the scar of having all those pull- the entire endorsement business in won’t be playing many more Wim- software and technology services that help 10 million But Mr. Bhupathi said that’s all outs will be talked about for a long India is much smaller than in the bledon or U.S. Open Grand Slams. going to change as his tennis-play- time,” Mr. Bhupathi said. “I think West. Agencies typically work on “It’s not going to last for ever,” he students at 1,600 universities, colleges and institutions ing days wind down. He expects to it’s going to be a learning experi- 10% commission, and there is a said. But, “my success in tennis of higher education find better ways to teach, learn, hang up his racket shortly after the ence for a lot of people as to what packed field of competitors like opens a lot of doors for me in the AA S S H E S 2012 Summer Olympics and focus needs to change in this country.” Cornerstone Sport & Entertain- business world.” Source: Opta Sports manage and connect. sungard.com/missioncritical full-time on his Mumbai-based com- Mr. Bhupathi did most of his ment Pvt. Ltd. and Percept Talent —Geeta Anand contributed pany, arranging sponsorship deals damage on the court alongside Mr. Management, a unit of Percept to this article. 6 THE WALL STREET JOURNAL. Thursday, October 14, 2010 Thursday, October 14, 2010 THE WALL STREET JOURNAL. 27 EUROPE NEWS C-SUITE: LIFE/WORK Ethnic violence Slumping at work? Try these tips flares in Kosovo Sports legends offer clues on how to spark an office comeback and get your head in the game

BY GORDON FAIRCLOUGH Kosovo institutions,” says Ylber BY SUE SHELLENBARGER sion network TBS. Frustrated, he the golf course by stepping back Hysa, the Kosovo government’s top was trying to break out of his for a moment to “consciously re- MITROVICA, Kosovo—Assailants official for the north. After years in sales, Dan Di Cio, slump with hard work, but he was gain a positive frame of mind,” struck in the middle of the night, Distrust between Albanians and a Pittsburgh account executive, rushing himself on the mound and says a spokesman for Mr. Nick- setting fire to a car belonging to Serbs runs deep. During the 1990s, was aiming for “a breakout sea- overanalyzing every bad pitch he laus. one ethnic Serb politician who fa- as the former Yugoslavia disinte- son” selling high-tech equipment. made, he says. To help anxious clients, Dr. vors cooperation with Kosovo’s Al- grated in warfare, Kosovo’s Albanian But even working longer hours With Dr. Llewellyn’s help, Mr. Llewellyn, of Marietta, Ga., has banian-dominated national govern- majority suffered persecution at the and weekends, he kept falling Smoltz worked to recover more them list on a card their ment and tossing a grenade at the hands of the Serbian government. short of his goals. Watching other swiftly from a bad pitch. He re- strengths, such as a great fast home of another. A bloody Serb crackdown on Al- salespeople win awards, he asked peatedly watched a two-minute ball, then laminate and carry it. The attack last month in the banian separatists led to a NATO air himself early this year: “Why can’t tape Dr. Llewellyn had made of a Baseball players often keep it in town of Zvecan was part of a recent war against Serbia and international I be that guy?” half-dozen of his perfect pitches. their back pockets and glance at it series of arsons and bombings that administration of Kosovo. Serbs suf- Mr. Di Cio, a big baseball fan, Then if he made a bad pitch dur- between innings, he says. Some have swept across the north of this fered reprisal attacks. And in 2004, recalled how U.S. Major League ing a game, “I literally would not coaches have business executives fledgling Balkan state, which de- rioting across the country destroyed pitcher John Smoltz step back on the mound until I watch videos of good presenta- clared independence from Serbia in Serb property and forced many to WORK & got help on his mental had pulled up that positive file in tions they have made in the past. 2008 after years of ethnic strife. flee their homes. FAMILY game to pull out of a my mind,” evoking what it felt like Other people develop rituals to Many local Serbs—who make up In recent years, however, prog- slump in 1991. Mr. Di to throw well, Mr. Smoltz says. clear their minds, such as golfers Agence France-Presse/Getty Images (2) the majority of the population in ress has been made. Kosovo has Cio contacted sports psychologist His confidence restored, Mr. who shake off a bad shot by pull- Ukrainian President Viktor Yanukovych, left, is investigating the government of former Premier Yulia Tymoshenko, right. Kosovo’s northern-most municipali- pursued a policy of decentralization, Gregg Steinberg after hearing him Smoltz posted a 12-2 record for ing up some grass and scattering ties—don’t recognize the authority allowing Serb communities to elect speak and, with his help, Mr. Di the remainder of the season and it in the wind. of Kosovo’s central government in their own municipal leaders and Cio learned that he was working “never looked back,” he says. Amateur golfer Greg DeRosa, Pristina and say they would prefer giving them broad authority over so hard that he risked driving his The psychological effects of a Brookville, N.Y., says learning to to remain part of Serbia. education, health care and other numbers even lower. Dr. Steinberg slump are similar in sports and stop dwelling on his mistakes on As Kosovo and Serbia prepare government matters. says he prescribed the same rem- work. The brains of athletes the golf course has helped him in Ukraine government for talks aimed at improving rela- Mrs. Clinton met mayors from edy many pro athletes embrace: forced to watch videos of them- business. During a slump as a tions, tensions have climbed here in such Serb enclaves in a Kosovo that Stop overworking and allow your- selves losing resemble those of golfer for Rollins College in Win- the ethnically split town of is 90% Albanian. She said Washing- self to relax. people who are depressed, which ter Park, Fla., his anxiety after bad Mitrovica and other parts of the ton would support them and that Mr. Di Cio says his outlook im- threatens to trigger further de- shots triggered pessimism and north, as both sides maneuver to the successes of Kosovo and its Serb proved so much that his boss clines in performance, according more misses. When he practiced investigates its rivals strengthen their positions before minority are intertwined. asked, “What’s different about to a 2007 study in the journal harder and took lessons, he lost discussions start. But the situation in Kosovo’s you?” His 2010 sales have doubled Brain Imaging and Behavior. Simi- the rhythm of his swing, he says. On Wednesday, U.S. Secretary of northern municipalities—which are over a year earlier. larly, workplace studies show that Working with Tom Ferraro, a BY ALAN CULLISON Strauss Hauer & Feld, and Trout fessional investigation. State Hillary Clinton stopped in adjacent to Serbia and home to Few events rivet people’s at- employees who lose self confi- Williston Park, N.Y., psychothera- To boost his self AND JAMES MARSON Cacheris, and the investigative firm He noted that investigators Pristina and met Kosovo’s prime more than 40% of the country’s tention more than a great athlete dence or think ill of themselves pist who works with athletes and confidence during the Kroll Inc.—worked for five months looked only at the Tymoshenko gov- minister, Hashim Thaci. Mrs. Clin- Serbs—has long been different. In in a slump, from Tiger Woods’s tend to perform more poorly than performers, Mr. DeRosa quit tak- recession, real-estate KIEV—Ukraine’s government will in London, Washington and Kiev on ernment, without looking at Mr. ton, who visited Serbia Tuesday, the Serb north side of Mitrovica, lackluster performances on the people with high self-esteem, in ing lessons and started telling broker Tim Stowell, issue a raft of corruption allegations the report. Yanukovych’s own role as prime called on both sides to “settle prac- Serbian flags fly, signs are written golf course earlier this year to turn fueling added anxiety and de- himself, “I’m pretty good the way below, copied some against the country’s former prime The investigators compiled 2,000 minister from 2006 to 2007. tical problems and overcome obsta- in Cyrillic and the Serbian currency, Yankees’ slugger Alex Rodriguez’s pression. I am. I’m going to trust my in- tactics used by golfer minister Thursday—a move certain pages of exhibits to back up allega- “These American firms are being cles to being good neighbors.” the dinar, is legal tender. drought before hitting his 600th Tim Stowell, a commercial stincts.” Instead of beating him- Jack Nicklaus to to step up tensions with her sup- tions, and two civil suits have al- used by a government widely ac- Mr. Thaci said it is time for “a Oliver Ivanovic, a local Kosovo home run. Even when the world real-estate broker for 25 years, self up if his ball landed in the improve the mental porters who say the country’s new ready been filed in the U.S. and U.K. cused of backsliding on democracy new phase” in which Serbia and Ko- Serb who serves as state secretary isn’t watching, the same psycho- used similar tactics when he be- bunker, he cut his losses and set- side of his game. president is creating an authoritar- against companies that allegedly in a smear campaign to help cement sovo can “cooperate and look to the in Serbia’s Ministry for Kosovo and logical hurdles trip up the rest of gan losing his self-confidence dur- tled for a manageable shot that (Top to bottom) Associated Press; Josh Anderson for The Wall Street Journal ian state. aided corrupt government officials their rule,” he said. future.” Metohija, says the north needs us, executives who aren’t making ing the recession. “When you hear would get the ball back on the In a new twist in Ukraine politics, in skimming public funds. The report accuses officials in Coming up with a solution that “some kind of special status” that their numbers or producing ‘no, no, no,’ enough times” while fairway. And he remained optimis- the government of President Viktor While the report doesn’t link Ms. Ms. Tymoshenko’s government of will bring peace to north Kosovo, will “make us feel that we are freely enough good work on the job. At trying to lure new clients, “you tic, telling himself the game Yanukovych will use Western exper- Tymoshenko to any alleged theft, it enriching themselves by acting as which for the past decade has func- connected with Serbia.” Anything the office, people lose confidence, start to question whether you’ve “would turn out OK,” he says. He tise in leveling charges against his does accuse some high-level officials intermediaries in government pur- tioned largely as an extension of less, he says, won’t work. “Emotions dwell on past mistakes, become still got the right approach,” says has trimmed three strokes off his rivals. Investigators will release a around her. chases of vehicles, medical products, Serbia, will be critical to any lasting are too strong and too widespread,” anxious about every move and Mr. Stowell of Nashville, Tenn. average since college five years report researched and written by The report says Ms. Tymoshenko vaccines and 22,000 tons of sugar reconciliation between Pristina and he says. struggle to perform tasks they Borrowing a tactic that he had ago. U.S. private detectives and attorneys steered hundreds of millions of dol- needed to replenish the country’s Belgrade, diplomats say. In talks with Kosovo, Belgrade once enjoyed. read was used by golfer Jack Nick- He applied those skills when a who have lately been employed by lars of budget money to boost her supplies this year after they were North Atlantic Treaty Organiza- can be expected to push for a great “The principles that lead to laus to ward off anxiety, Mr. Stow- restaurant he invested in started the country’s political elite. popularity before presidential elec- sold off in the summer of 2009. tion peacekeeping troops and police degree of autonomy and authority slumps are the same” in both ell started visualizing himself per- losing money. Says Mr. DeRosa, The report takes aim at officials tions that swept her out of power Mark MacDougall, who headed officers deployed by the European for Serb communities in the north, realms, says Dr. Steinberg, a Nash- forming well in the future, in his chief executive of a golf-course who served under former Prime this year, when she was defeated by the investigation for Akin Gump, Union have stepped up joint patrols as well as provisions that grant a ville, Tenn., author and speaker on case client calls, and asked him- construction-materials business. “I Minister Yulia Tymoshenko, a char- Mr. Yanukovych, whose allies in Par- said the investigation ranged far with Kosovo police in the area and sort of extra-territorial status to performance issues. Signaling a self, “What is it that I’m afraid of? was able to move on and say, ismatic populist heroine of Ukraine’s liament then fired her. outside Ukraine to the state of Ore- are using nightly checkpoints in an Serb churches and monasteries slump, he says, are a loss of confi- I’m playing well or I wouldn’t be ‘Enough is enough. We’re done 2004 Orange Revolution who was Among the more serious charges, gon, the U.K., Latvia, Israel and the effort to intercept weapons and ex- across Kosovo. The EU put enor- dence, over-thinking every move, where I am.” with this,’ ” and sell the restau- defeated in elections at the begin- the report says Ms. Tymoshenko au- Seychelles, where it found “the use plosives. mous pressure on Belgrade to enter dwelling on past failures or work- Instead of criticizing himself in rant. ning of the year and has since seen thorized the sale last year of about of extensive classic offshore money Much of the recent violence is into negotiations, effectively tying ing too much. his head if he makes a minor error Sometimes, the causes of per- a number of allies arrested or inves- €320 million ($443 million) in car- laundering structures.” aimed at intimidating local Serbs Serbia’s membership in the EU to A star pitcher for the Atlanta during a presentation, he laughs it formance problems go deeper, and tigated for corruption or misman- bon credits under the Kyoto Protocol Investigators said the findings willing to engage with Kosovo’s better ties with Kosovo. Braves, Mr. Smoltz had a dismal off or ignores it. He also recalls therapy is needed to heal past agement. framework, and used most of the give a rare glimpse into some of the leaders, EU and Kosovo officials say. In the past, some in Belgrade record of 2-11 at the All-Star break his goal of helping clients save traumas, says David Grand, a New Ms. Tymoshenko, a longtime proceeds to cover a shortfall in methods of government graft in a Hard-line nationalist Serbs “are have called for Kosovo’s partition so in 1991 when he tapped sports money, he says. Re-focusing on York psychotherapist and per- archrival of Mr. Yanukovych, has Ukraine’s pension fund. country where allegations are plen- sending very threatening messages that the northern municipalities can psychologist Jack Llewellyn for what he likes about his job is formance coach. In the middle of a his ability to throw the ball back boss received a letter from a cus- called the investigations politically Although some has been re- tiful but proof is usually scarce. to all Serbs who cooperate, who rejoin Serbia, something rejected by help. “I had lost my confidence,” helping him land more new clients successful career, Mackey Sasser, to the pitcher, says Mr. Sasser, tomer complaining about her, motivated. turned to segregate accounts ear- They allege that the cases were part show a readiness to participate in Pristina. says Mr. Smoltz, now a Major once again, he says. a catcher for the New York Mets now a college baseball coach in those old fears resurfaced. The Political analysts said the latest marked for environmental projects of a wider pattern of malfeasance in League Baseball analyst for televi- Mr. Nicklaus curbed tension on from 1987 to 1995, suddenly lost Dothan, Ala. The pressure “just customer’s complaints were irra- attack on Ms. Tymoshenko may as directed by the Kyoto agreement, Ms. Tymoshenko’s government, and overwhelmed me,” he says. “I bat- tional and unfounded, but she backfire, since voters in Ukraine about €200 million hasn’t. that its profile was part of an “effort tled it and battled it,” but the says she was “disturbed to the have in the past viewed corruption The report also accused the Ty- to provide a survey or cross-section problem ended his pro career. point where I was overcompensat- allegations as a public-relations tac- moshenko government of buying of suspect government transactions When the problem cropped up ing and being extra hands-off.” tic used to destroy opponents. Ms. 1,000 imported vehicles for the Min- during the stated period of time.” again in his work as a college Working with Dr. Ferraro, Ms. Tymoshenko’s political career got a istry of Health shortly before the “From the start, our job has been baseball coach, Mr. Sasser began McManus says she learned to boost in the 1990s when she was elections, and using them mainly as to establish the facts,” Mr. MacDou- working with Dr. Grand. He real- draw strength from past suc- briefly jailed on corruption charges a mobile advertising gimmick for gall said. “Every material finding in ized he was haunted by past trau- cesses, telling herself, “I do know that were later dropped. her campaign. the report is backed by hard evi- mas—a difficult childhood and a how to do this.” She set new sales “This is not an attempt to fight The report also accuses Ms. Ty- dence.” hard hit at home plate by a fast- goals and planned to reward her- corruption,” said Oleh Rybachuk, a moshenko of diverting money from Kroll and Akin Gump have in re- ball that broke his shoulder. Un- self with a new pair of shoes or former chief of staff in Ukraine’s a state stabilization fund for banks cent years been retained by top derstanding how his suppressed even a vacation. She learned that presidential administration. “It is a and steering it into an unrelated businessmen and politicians in other fears had resurfaced and blocked while old fears may resurface, strategy to destroy their lifelong op- program to provide funding for 6.4 high-profile matters in Ukraine. his performance enabled him to “that doesn’t define you. Instead, ponent [Tymoshenko]. She’s no an- million citizens to register and for- Kroll was in 2001 employed by a throw again while coaching prac- you remember all the other parts gel, but this is a selective approach.” mally own their plots of land. party backed by oligarch Viktor tices with his team, Mr. Sasser of yourself that are strong.” Mr. Yanukovych’s chief of staff, Hryhoriy Nemyria, former deputy Pinchuk, son-in-law of Mr. Yanuk- says. Serhiy Lyovochkin, denied any polit- prime minister and a top adviser to ovych’s political patron, then-Presi- Psychotherapist Dr. Ferraro Email [email protected]. ical motivation in the investigation, Ms. Tymoshenko, declined to com- dent Leonid Kuchma, to look into says similar patterns crop up with which has so far cost more than $2 ment on specific allegations, saying the killing of investigative journalist his business clients. Robin Mc- WSJ.com million, and which officials say aims he hadn’t had a chance to review Georgiy Gongadze in 2000. Manus of Boston thought she put at retrieving stolen funds to state them. But he denied any widespread Akin Gump has in the past repre- her difficult childhood and innate ONLINE TODAY: Hear an interview Agence France-Presse/Getty Images coffers. corruption in her government, and sented Rinat Akhmetov, Ukraine’s (Left to right) Agenceshyness France-Presse/Getty Images; Jeff Swensen for WSJ behind her when she be- on how to get out of a perform- The firms that compiled the re- called the report a smear campaign richest man and a major backer of US Secretary of State Hillary Clinton poses in front of a statue of her husband, Dan Di Cio, right, a Pittsburgh account executive, was falling short of his personal sales goals. He found inspiration in came a top-ranked home-improve- ance slump at WSJ.com/Health port—the law firms Akin Gump conducted under the guise of a pro- Mr. Yanukovych. former President Bill Clinton, in Pristina on Wednesday. former Major League pitcher John Smoltz, left, who visualized perfect pitches to break out of his slump in 1991. ment saleswoman. But when her 26 THE WALL STREET JOURNAL. Thursday, October 14, 2010 Thursday, October 14, 2010 THE WALL STREET JOURNAL. 7 GLOBAL MARKETS LINEUP U.S. NEWS

Commodities Prices of futures contracts with the most open interest Currencies London close on Oct. 13 EXCHANGE LEGEND: CBOT: Chicago Board of Trade; CME: Chicago Mercantile Exchange; ICE-US: ICE Futures U.S.MDEX: Bursa Malaysia Per In Per In Derivatives Berhad; LIFFE: London International Financial Futures Exchange; COMEX: Commodity Exchange; LME: London Metals Exchange; AMERICAS Per euro In euros U.S. dollar U.S. dollars EUROPE Per euro In euros U.S. dollar U.S. dollars NYMEX: New York Mercantile Exchange;ICE-EU: ICE Futures Europe Argentina peso-a 5.5194 0.1812 3.9538 0.2529 Euro zone euro 1 1 0.7163 1.3960 ONE-DAY CHANGE Contract Contract Commodity Exchange Last price Net Percentage high low Brazil real 2.3130 0.4323 1.6569 0.6035 1-mo. forward 1.0002 0.9998 0.7165 1.3957 Higher ethanol levels allowed in gas Canada dollar 1.3994 0.7146 1.0024 0.9976 3-mos. forward 1.0008 0.9992 0.7169 1.3949 Corn (cents/bu.) CBOT 569.25 -9.75 -1.68% 705.00 343.25 1-mo. forward 1.4004 0.7141 1.0032 0.9968 6-mos. forward 1.0018 0.9982 0.7176 1.3935 Soybeans (cents/bu.) CBOT 1187.00 -2.50 -0.21 1,205.00 872.75 BY TENNILLE TRACY the types of vehicles for which the nol in motor fuels. The EPA’s decision comes as the nol trade group led by Wesley Clark, 3-mos. forward 1.4025 0.7130 1.0047 0.9953 Czech Rep. koruna-b 24.452 0.0409 17.516 0.0571 Wheat (cents/bu.) CBOT 702.75 -7.25 -1.02 1,038.25 472.75 blend has been approved. The EPA’s clean-air director said Obama administration is under criti- the retired U.S. Army general and 6-mos. forward 1.4061 0.7112 1.0073 0.9928 Denmark krone 7.4572 0.1341 5.3418 0.1872 Live cattle (cents/lb.) CME 98.475 -0.825 -0.83 102.650 87.475 WASHINGTON—The U.S. Envi- The decision has been criticized the agency relied on solid testing to cism by some Farm Belt lawmakers 2004 Democratic presidential candi- Chile peso 664.71 0.001504 476.15 0.002100 Hungary forint 272.86 0.003665 195.46 0.005116 Cocoa ($/ton) ICE-US 2,867 17 0.60% 3,497 2,280 ronmental Protection Agency on by auto makers, off-road equipment reach its conclusion. for what they say are overly burden- date. Colombia peso 2502.96 0.0003995 1792.95 0.0005577 Norway krone 8.0960 0.1235 5.7995 0.1724 Coffee (cents/lb.) ICE-US 186.15 0.45 0.24 198.65 123.95 Wednesday approved an increase of makers and the petroleum industry, “For EPA’s part, we followed the some regulations from the agency. In Gen. Clark’s group petitioned the Ecuador US dollar-f 1.3960 0.7163 1 1 Poland zloty 3.9266 0.2547 2.8128 0.3555 ethanol levels in gasoline for model- which has urged the EPA to post- law. We looked at the test results,” South Dakota, Republican Kristi EPA last year to allow ethanol levels Sugar (cents/lb.) ICE-US 27.50 0.05 0.18 28.04 11.90 Mexico peso-a 17.2839 0.0579 12.3811 0.0808 Russia ruble-d 42.034 0.02379 30.110 0.03321 year 2007 cars and newer. pone a decision until more testing said Gina McCarthy, the EPA’s assis- Noem has called for EPA Administra- in gasoline blends to be as high as Cotton (cents/lb.) ICE-US 110.87 1.29 1.18 112.38 53.87 Peru sol 3.8913 0.2570 2.7875 0.3587 Sweden krona 9.2602 0.1080 6.6334 0.1508 In a widely anticipated move, the could be done. tant administrator for air and radia- tor Lisa Jackson’s resignation, citing 15%. Without the increase, the group Crude palm oil (ringgit/ton) MDEX 2,930.00 30 1.03 2,940 2,250 Uruguay peso-e 28.129 0.0355 20.150 0.0496 Switzerland franc 1.3384 0.7472 0.9588 1.0430 EPA said it would allow ethanol to Cocoa (pounds/ton) LIFFE 1,914 ... unch. 2,360 1,590 U.S. dollar 1.3960 0.7163 1 1 1-mo. forward 1.3380 0.7474 0.9585 1.0433 While the groups have varying tion, in a conference call. She said it the agency’s inaction on the issue said, the U.S. wouldn’t be able to Robusta coffee ($/ton) LIFFE 1,679 -8 -0.47 1,844 1,342 Venezuela bolivar 6.00 0.166796 4.29 0.232848 3-mos. forward 1.3372 0.7478 0.9579 1.0440 make up 15% of fuel blends, up from motives for opposing greater corn was “an appropriate decision for the some 18 months after an ethanol in- meet a congressional mandate re- the current 10%, for these vehicles. ethanol production, they—along agency to make under our jurisdic- dustry trade group formally peti- quiring some 36 billion gallons of re- Copper (cents/lb.) COMEX 382.05 3.10 0.82 383.85 189.50 ASIA-PACIFIC 6-mos. forward 1.3360 0.7485 0.9571 1.0449 The EPA also proposed a labeling with many environmentalists—gen- tion under the Clean Air Act.” tioned the agency for such a step. newable fuel to be blended into the Gold ($/troy oz.) COMEX 1370.50 23.80 1.77 1,373.30 675.00 Australia dollar 1.4080 0.7102 1.0086 0.9915 Turkey lira 1.9658 0.5087 1.4082 0.7102 program under which U.S. gasoline erally say the government hasn’t For cars made between 2001 and The cause of boosting ethanol domestic fuel supply by 2022. Silver (cents/troy oz.) COMEX 2393.20 78.50 3.39 2,395.50 895.50 China yuan 9.3029 0.1075 6.6640 0.1501 U.K. pound 0.8814 1.1345 0.6314 1.5838 stations would state the level of eth- conducted sufficient testing to war- 2006, the agency is awaiting the use in cars has been strongly cham- —Stephen Power Aluminum ($/ton) LME 2,424.00 8.00 0.33 2,481.50 1,857.00 Hong Kong dollar 10.8319 0.0923 7.7593 0.1289 1-mo. forward 0.8816 1.1343 0.6315 1.5834 3-mos. forward 0.8820 1.1337 0.6318 1.5827 anol included in the fuel and identify rant higher concentrations of etha- outcome of additional research. pioned by Growth Energy, an etha- contributed to this article. Tin ($/ton) LME 26,750.00 250.00 0.94 26,750.00 14,250.00 India rupee 61.9475 0.0161 44.3750 0.0225 Indonesia rupiah 12457 0.0000803 8923 0.0001121 6-mos. forward 0.8827 1.1329 0.6323 1.5816 Copper ($/ton) LME 8,409.50 139.50 1.69 8,409.50 6,120.00 Japan yen 114.21 0.008756 81.81 0.012223 MIDDLE EAST/AFRICA Lead ($/ton) LME 2,433.00 120.00 5.19 2,615.00 1,580.00 1-mo. forward 114.18 0.008758 81.79 0.012227 Bahrain dinar 0.5263 1.9000 0.3770 2.6524 Zinc ($/ton) LME 2,409.00 72.00 3.08 2,659.00 1,617.00 3-mos. forward 114.09 0.008765 81.73 0.012236 Egypt pound-a 7.9591 0.1256 5.7014 0.1754 Nickel ($/ton) LME 24,205 105 0.44 27,590 15,910 6-mos. forward 113.95 0.008775 81.63 0.012251 Israel shekel 5.0130 0.1995 3.5910 0.2785 Gates says Crude oil ($/bbl.) NYMEX 83.74 1.29 1.56 145.07 27.15 Republicans launch $50 million ad blitz Malaysia ringgit-c 4.3178 0.2316 3.0930 0.3233 Jordan dinar 0.9892 1.0109 0.7086 1.4112 Heating oil ($/gal.) NYMEX 2.3185 0.0358 1.57 3.8342 1.5175 New Zealand dollar 1.8320 0.5458 1.3123 0.7620 Kuwait dinar 0.3944 2.5357 0.2825 3.5398 RBOB gasoline ($/gal.) NYMEX 2.1448 0.0378 1.79 3.1450 1.2967 Pakistan rupee 120.126 0.0083 86.050 0.0116 Lebanon pound 2095.40 0.0004772 1501.00 0.0006662 BY BRODY MULLINS launching the ad blitz, are less than Congress Natural gas ($/mmBtu) NYMEX 3.696 0.067 1.85 11.150 3.545 Philippines peso 60.565 0.0165 43.385 0.0230 Saudi Arabia riyal 5.2351 0.1910 3.7501 0.2667 AND DANNY YADRON a year old. Brent crude ($/bbl.) ICE-EU 84.85 0.97 1.16 147.32 52.63 Singapore dollar 1.8180 0.5501 1.3023 0.7679 South Africa rand 9.5026 0.1052 6.8070 0.1469 “The scales have tipped from the Gas oil ($/ton) ICE-EU 725.50 12.25 1.72 772.50 610.25 South Korea won 1562.82 0.0006399 1119.50 0.0008933 United Arab dirham 5.1274 0.1950 3.6730 0.2723 An alliance of Republican groups political party to the outside politi- Taiwan dollar 43.119 0.02319 30.888 0.03238 should set is launching a $50 million advertis- cal organizations,” said former Rep. Source: Thomson Reuters; WSJ Market Data Group SDR -f 0.8874 1.1268 0.6357 1.5731 WSJ.com Thailand baht 41.685 0.02399 29.860 0.03349 ing blitz this week in a final push to Bill Paxon of New York, who once a-floating rate b-commercial rate c-government rate c-commercial rate d-Russian Central Bank rate f-Special Drawing Rights help the GOP win a majority in the led the National Republican Con- Follow the markets throughout the day with updated stock quotes, news and commentary at WSJ.com. from the International Monetary Fund ; based on exchange rates for U.S., British and Japanese currencies. House, representing the biggest gressional Committee, the party’s gay policy Also, receive email alerts that summarize the day’s trading in Europe and Asia. To sign up, go to WSJ.com/email Note: Based on trading among banks in amounts of $1 million and more, as quoted by Thomson Reuters. spending blitz ever by such groups House campaign arm. in a congressional election. Evan Tracey, head of Campaign BY ADAM ENTOUS The coordinated effort, which Media Analysis Group, which tracks the groups have dubbed the “House campaign-ad spending, called the Defense Secretary Robert Gates Major stock market indexes Stock indexes from around the world, grouped by region. Shown in local-currency terms. surge strategy,” tops what the offi- combination of ad outlays by the said he would strongly prefer legis- cial Republican House election com- groups “historic” in its size, an as- lative action by Congress to repeal Price-to- PREVIOUS SESSION PERFORMANCE Price-to- PREVIOUS SESSION PERFORMANCE mittee expects to spend on TV ads sessment echoed by other cam- the policy that bans homosexuals earnings ratio* Region/Country Index Close Net change Percentage change Yr.-to-date 52-wk. earnings ratio* Region/Country Index Close Net change Percentage change Yr.-to-date 52-wk. for the entire contest. It is aimed at paign-finance experts and officials. from serving openly in the military, 23 EUROPE Stoxx Europe 600 266.25 3.77 1.44% 5.2% 7.8% 13 Portugal PSI 20 7772.33 76.84 1.00 -8.2 -12.5 the few dozen competitive races The record spending was made rather than to see the ban repealed 14 Stoxx Europe 50 2553.42 39.50 1.57 -1.0 2.5 ... Russia RTSI 1588.83 14.63 0.93% 11.3 10.2 where Democratic candidates have possible in part by a Supreme Court immediately by court order. 27 Euro Zone Euro Stoxx 273.19 5.41 2.02 -0.6 -1.3 10 Spain IBEX 35 10866.1 217.9 2.05 -9.0 -8.5 significantly more money in the decision that allowed companies Mr. Gates said extensive training bank than their Republican oppo- and unions to donate unlimited and regulatory changes were needed 14 Euro Stoxx 50 2840.55 64.80 2.33 -4.2 -3.7 15 Sweden OMX Stockholm 348.58 4.63 1.35 16.4 20.4 nents, eating into one of the Demo- funds to such groups. It also al- to ensure that the “don’t ask, don’t 16 Austria ATX 2689.60 42.85 7.8 -1.5 13 Switzerland SMI 6455.13 79.87 1.25 -1.4 0.8 1.62 crats’ last financial advantages. lowed ads by such groups directly tell policy” is repealed in an orderly ... Turkey ISE National 100 70166.89 491.81 32.8 37.5 10 Belgium Bel-20 2670.38 49.56 1.89 6.3 3.3 0.71 Democratic candidates, notably supporting or opposing candidates way to minimize the impact on U.S. 12 Czech Republic PX 1151.9 11.9 1.04 3.1 -2.1 12 U.K. FTSE 100 5747.35 85.76 1.51 6.2 9.3 incumbents, have raised more cash in the weeks before the election. forces. 22 Denmark OMX Copenhagen 398.40 7.00 1.79 26.2 26.1 18 ASIA-PACIFIC DJ Asia-Pacific 133.97 1.00 0.75 8.9 9.1 than many of their Republicans ri- Spending by outside groups thus A federal judge in California is- 17 Finland OMX Helsinki 7449.69 113.19 1.54 15.4 15.6 ... Australia SPX/ASX 200 4619.88 1.70 0.04 -5.1 -4.4 vals in this year’s most competitive far has focused on Senate races. The sued an injunction on Tuesday to 13 France CAC-40 3828.34 79.48 2.12 -2.7 -1.4 ... China CBN 600 27067.48 316.89 1.18 -6.8 4.7 House races, according to a Wall new Republican effort marks the be- immediately stop enforcement of 13 Germany DAX 6434.52 129.95 2.06 8.0 9.9 15 Hong Kong Hang Seng 23457.69 335.99 1.45 7.2 7.2 Street Journal tally of Federal Elec- ginning of an effort to defeat House the 17-year-old policy, ordering the tion Commission data. In the 40 Democrats. government to suspend and discon- ... Hungary BUX 23648.58 242.61 1.04 11.4 10.7 22 India Sensex 20687.88 484.54 2.40 18.5 20.1 races deemed toss-ups by the Cook In southern New York, Demo- tinue all pending discharge proceed- ... Japan Nikkei Stock Average 9403.51 14.87 -10.8 -6.5 12 Ireland ISEQ 2729.06 19.61 0.72 -8.3 -17.9 0.16 Political Report, a political handi- cratic Rep. Maurice Hinchey has ings and investigations under way. 12 Italy FTSE MIB 21145.26 395.04 1.90 -9.0 -13.2 ... Singapore Straits Times 3202.16 52.80 1.68 10.5 18.2 capper, Democratic candidates had raised and spent more than his ri- “I feel very strongly that this is 14 Netherlands AEX 341.72 6.63 1.98 1.9 5.0 11 South Korea Kospi 1876.15 8.11 0.43 11.5 13.8 a combined $39.3 million of cash on val, Republican George Phillips. Mr. an action that needs to be taken by 9 Norway All-Shares 438.28 7.96 1.85 4.3 12.0 17 AMERICAS DJ Americas 319.90 4.04 1.28 7.9 10.4 hand as of June 30, the most-recent Hinchey had $267,106 left in his the Congress, and that it is an action 17 Poland WIG 46286.96 833.98 1.83 15.8 18.8 ... Brazil Bovespa 71795.85 849.36 1.20 4.7 8.7 filing deadline. Republican candi- campaign account as of Aug. 25 and that requires careful preparation 17 Mexico IPC 34859.27 421.88 1.23 8.5 13.0 dates had $16.5 million in the bank. Mr. Phillips had $34,727, FEC re- and a lot of training,” Mr. Gates told Thomson Reuters is the primary data provider for several statistical tables in The Wall Street Journal, including foreign Steven Law, who runs two of the cords show. stock quotations, futures and futures options prices, and foreign exchange tables. Reuters real-time data feeds are used *P/E ratios use trailing 12-months, as-reported earnings Republican organizations, American American Crossroads plans to to calculate various Dow Jones Indexes. Note: Americas index data are as of 3:00 p.m. ET. Sources: Thomson Reuters; WSJ Market Data Group Crossroads and its affiliate Cross- drop $300,000 in anti-Democratic Mr. Gates wants any roads GPS, said the effort was ad buys on the race, giving Mr. Phil-

Dow Jones Indexes MSCI indexes “aimed at putting Republicans over Associated Press lips more money to play with than legislative changes to take the top by evening out the financial A group backed by Karl Rove is working on the ‘House surge strategy.’. his incumbent opponent, who is Price-to- Price-to- Developed and emerging-market regional and country indexes effect after the Pentagon Dividendearnings PERFORMANCE (euros) PERFORMANCE (U.S.dollars) Dividendearnings PERFORMANCE (euros) PERFORMANCE (U.S.dollars) disparities and dramatically expand- currently favored to win. yield* ratio* Dows Jones Index Last Daily 52-wk. Last Daily 52-wk. yield* ratio* Dows Jones Index Last Daily 52-wk. Last Daily 52-wk. from MSCI Barra as of October 13, 2010 ing the field of battle.” In South Bend, Ind., GOP groups completes its own review. 2.20% 16 Global TSM 2488.57 1.45% 7.9% 1.83% 11 Turkey Titans 20 -c 751.90 0.33% 53.5% 848.79 0.48% 40.2% Price-to- LOCAL-CURRENCY American Crossroads was set up Where the money is going are launching a coordinated effort 1.97 15 Global Dow 1367.10 0.62% 10.7% 2026.91 1.54 3.7 4.53 14 Global Select Div -d 178.70 0.43 12.1 213.56 1.35 5.0 Dividend earnings PERFORMANCE yield ratio Morgan Stanley Index Last Daily YTD 52-wk. with the help of former Republican on behalf of Republican state House 2.28 14 Global Titans 50 164.10 0.36 7.4 171.11 1.27 0.6 5.31 11 Asia/Pacific Select Div -d 287.65 0.97 3.1 Republican groups in the U.S. are directing ad dollars to close races 2.50% 15 ALL COUNTRY (AC) WORLD* 312.47 0.30% 4.4% 8.8% White House advisers Karl Rove and leader Jackie Walorski, who has reporters on his plane when asked 2.64 17 Europe TSM 2748.76 2.34 1.3 4.04 14 U.S. Select Dividend -d 347.58 1.10 14.1 where Democrats enjoy a cash advantage. Some of the targets: 2.50 16 World (Developed Markets) 1,207.82 0.22 3.4 7.2 Edward Gillespie. $700,000 less in the bank than her his reaction to the decision by U.S. 2.25 17 Developed Markets TSM 2387.59 1.40 6.6 1.60 19 Islamic Market 2092.47 1.54 8.8 2.40 16 World ex-EMU 143.68 0.12 5.1 9.7 The other two groups are the Colorado 3rd District Florida 2nd District rival, two-term Democratic Rep. Joe District Judge Virginia Phillips. 2.04 13 Emerging Markets TSM 4790.71 1.85 18.3 1.96 14 Islamic Market 100 1789.70 0.65 11.5 2138.19 1.57 4.5 2.40 16 World ex-UK 1,204.19 0.14 3.5 7.0 American Action Network, run by Rep. John Salazar (D) Rep. Allen Boyd (D) Donnelly, who has $1 million. Legislation to repeal the policy 2.84 26 Africa 50 892.50 0.65 19.3 790.79 1.57 11.7 2.95 13 Islamic Turkey -c 1805.10 0.99 36.3 3498.28 1.14 24.5 3.10 15 EAFE 1,596.77 0.93 1.0 2.8 former Republican Sen. Norm Cole- vs. Scott Tipton (R) vs. Steve Southerland (R) The American Action Network stalled in Congress last month, but 2.54 13 BRIC 50 495.30 1.08 15.6 659.17 2.00 8.3 2.44 16 Sustainability 878.20 0.78 9.3 1035.05 1.70 2.4 2.20 14 Emerging Markets (EM) 1,098.95 0.79 11.1 20.2 man of Minnesota, and the Commis- $1.3 Cash will spend $240,000 on broadcast the White House and its Democratic 2.87 18 GCC 40 594.10 0.12 5.5 526.44 1.04 -1.1 3.31 21 Brookfield Infrastructure1691.50 0.13 27.2 2251.38 1.04 19.1 Tallahassee 3.30 14 EUROPE 90.95 -0.27 3.0 7.9 sion on Hope, Growth and Opportu- on hand*, TV ads in South Bend, while Ameri- allies plan to try again after the No- 1.87 17 U.S. TSM 12256.77 1.19 9.7 1.08 22 Luxury 1145.30 1.01 31.6 1355.48 1.93 23.3 3.50 13 EMU 169.48 0.79 -6.1 -5.8 nity, a relative newcomer to the in millions $0.8 can Crossroads and its affiliate will vember congressional election. Pres- 2.87 27 Kuwait Titans 30 -c 233.46 0.66 0.9 3.12 14 UAE Select Index 260.25 0.81 -28.1 3.30 14 Europe ex-UK 98.36 -0.15 1.8 5.0 scene founded by Republican cam- Pueblo buy $150,000 of ads on Chicago- ident Barack Obama has made re- 1.80 RusIndex Titans 10 -c 3392.20 0.38 12.7 5909.38 1.32 8.2 DJ-UBS Commodity 145.10 -0.17 18.9 147.11 0.74 11.4 paign consultant Scott Reed. $0.2 area cable, which shares its media peal a priority. 4.50 12 Europe Value 97.36 -0.57 -2.1 0.1 $0.08 *Fundamentals are based on data in U.S. dollar. Footnotes: a-in US dollar. b-dividends reinvested. c-in local currency. Note:All data as of 2 p.m.ET. Source: DowJones Indexes 2.30 17 Europe Growth 82.32 0.01 8.1 16.1 In the Denver suburbs, a $1.5 D R market with northwest Indiana. Mr. Gates has voiced support for 2.20 22 Europe Small Cap 179.98 -0.24 14.5 16.8 million ad purchase by the Ameri- The spending is coordinated to repealing “don’t ask, don’t tell” but Cross rates U.S.-dollar and euro foreign-exchange rates in global trading 2.10 9 EM Europe 318.73 -0.33 14.4 27.3 can Action Network will level the Maryland 1st District Michigan 7th District avoid overlap. “It’s fair to say that wants any legislative changes to 3.50 16 UK 1,676.44 -0.20 4.3 9.7 playing field for Republican Ryan the targets are coordinated so that take effect after the Pentagon com- Frazier, who is taking on two-term Rep. Frank Kratovil (D) Rep. Mark Schauer (D) we are all not tripping over each pletes its own review later this year. USD GBP CHF SEK RUB NOK JPY ILS EUR DKK CDN AUD 2.70 17 Nordic Countries 163.52 -0.31 20.0 25.1 Democratic Rep. Ed Perlmutter. Mr. vs. Andy Harris (R) vs. Tim Walberg (R) other,” said a Republican involved “We have a lot of revision of reg- Australia 1.0086 1.5974 1.0520 0.1520 0.0335 0.1739 0.0123 0.2809 1.4080 0.1888 1.0062 ... 1.70 7 Russia 778.54 -0.72 4.3 16.0 Frazier had only $252,000 on hand $1.3 $1.7 with the effort. ulations that has to be done, in addi- Canada 1.0024 1.5876 1.0455 0.1511 0.0333 0.1728 0.0123 0.2791 1.3994 0.1877 ... 0.9939 2.30 20 South Africa 780.69 0.53 10.4 16.8 as of July 21, while Mr. Perlmutter Meanwhile, Democrats have re- tion to the training,” Mr. Gates said. Denmark 5.3418 8.4603 5.5716 0.8053 0.1774 0.9211 0.0653 1.4876 7.4572 ... 5.3290 5.2964 2.70 16 AC ASIA PACIFIC EX-JAPAN 455.13 1.29 9.3 15.5 $0.9 had a war chest of $1.3 million, ceived $482 million, or 53%, of the Mr. Gates said the Pentagon re- Euro 0.7163 1.1345 0.7472 0.1080 0.0238 0.1235 0.0088 0.1995 ... 0.1341 0.7146 0.7102 2.00 18 Japan 515.56 -1.63 -9.3 -8.4 Israel 3.5910 5.6874 3.7455 0.5414 0.1193 0.6192 0.0439 ... 5.0130 0.6722 3.5824 3.5605 “Conventional wisdom was that Baltimore $911 million donated to all congres- view, which includes surveys of ser- 2.20 15 China 68.09 -0.22 5.1 15.1 Battle Japan 81.8100 129.5707 85.3299 12.3331 2.7170 14.1065 ... 22.7820 114.2068 15.3151 81.6141 81.1146 Democrats would have a sizable fi- $0.2 sional candidates and political par- vice members and their spouses, 0.90 23 India 812.58 -0.77 14.9 19.5 Creek Norway 5.7995 9.1852 6.0490 0.8743 0.1926 ... 0.0709 1.6150 8.0960 1.0857 5.7856 5.7502 nancial advantage in the 2010 elec- ties from corporate political-action should not be rushed. 1.30 10 Korea 521.42 -1.26 8.5 9.7 Russia 30.1100 47.6882 31.4055 4.5392 ... 5.1919 0.3680 8.3849 42.0336 5.6367 30.0379 29.8541 tions—that will not be the case,” committees or individuals who work “One of the results of the review 3.50 14 Taiwan 285.13 -1.24 -3.7 3.6 *Based on most recent data available Source: U.S. Federal Election Commission Sweden 6.6334 10.5059 6.9187 ... 0.2203 1.1438 0.0811 1.8472 9.2602 1.2418 6.6175 6.5770 said Rob Collins, president of the for companies, according to the will be what kind of other changes 1.90 17 US BROAD MARKET 1,313.16 -0.40 6.2 11.8 Switzerland 0.9588 1.5185 ... 0.1445 0.0318 0.1653 0.0117 0.2670 1.3384 0.1795 0.9565 0.9506 American Action Network. nonpartisan Center for Responsive we need to make.… This is a very 1.30 37 US Small Cap 1,880.74 -0.40 12.6 16.7 U.K. 0.6314 ... 0.6586 0.0952 0.0210 0.1089 0.0077 0.1758 0.8814 0.1182 0.6299 0.6260 The spending campaign under- Outside political groups, most of dominance of political parties’ offi- Politics. Democrats have also col- complex business. It has enormous U.S. ... 1.5838 1.0430 0.1508 0.0332 0.1724 0.0122 0.2785 1.3960 0.1872 0.9976 0.9915 2.40 15 EM LATIN AMERICA 4,523.62 0.28 9.9 22.6 scores a phenomenon that emerged which don’t have to disclose their cial campaign committees. Many of lected 93% of the $49 million do- consequences for our troops,” Mr. Source: Thomson Reuters via WSJ Market Data Group *Twenty-three developed and 26 emerging markets Source: MSCI Barra with force in the 2010 elections: donors, are rivaling the traditional these groups, including those nated by labor unions. Gates said. 8 THE WALL STREET JOURNAL. Thursday, October 14, 2010 Thursday, October 14, 2010 THE WALL STREET JOURNAL. 25 U.S. NEWS BLUE CHIPS BONDS

Below, a look at the Dow Jones Stoxx 50, the biggest and best known companies in Dow Jones Industrial Average P/E: 15 For Fed, risks of goosing Major players benchmarks Europe, including the U.K. LAST: 11096.08 s 75.68, or 0.69% Stoxx Europe 50: Wednesday's best and worst... YEAR TO DATE: s 668.03, or 6.4% markets are worth taking OVER 52 WEEKS s 1,080.22, or 10.8% Previous close, in STOCK PERFORMANCE High Company Country Industry Volume local currency Previous session YTD 52-week lower borrowing costs for big 11500 [ Capital ] companies that can sell bonds. One Anglo American U.K. General Mining 6,402,646 2,884 5.39% 6.4% 24.8% Close problem: That won’t do much to Rio Tinto U.K. General Mining 7,497,688 4,038 4.56 19.1 34.7 Low BY DAVID WESSEL boost business spending, since BHP Billiton U.K. General Mining 8,994,246 2,216 4.16 11.1 20.3 11000 companies are so flush with cash Deutsche Bank Germany Banks 12,171,276 41.65 3.96 -7.6 -18.5 The Federal already. GDF Suez France Multiutilities 3,802,825 27.61 3.70 -8.8 -7.8 Reserve is about to It means lower mortgage rates, 10500 try to pump up too. More problems: Home building stock and bond isn’t going to get us out of this Standard Chartered PLC U.K. Banks 15,866,686 1,876 -1.70% 19.1 17.2 markets, depress torpor and many homeowners can’t Barclays U.K. Banks 133,335,345 292.00 -0.93 5.8 -23.9 s 10000 the value of the U.S. refinance; their houses are worth Tesco U.K. Food Retailers & Wholesalers 21,215,839 433.90 -0.73 1.4 16.0 50–day moving average dollar and generate a whiff of less than they paid for them. Nestle S.A. Switzerland Food Products 6,383,010 52.55 0.10% 4.7 20.5 inflation. So the Fed hopes to chase 9500 Astrazeneca U.K. Pharmaceuticals 2,220,040 3,340 0.59 14.8 19.9 That’s not how Fed Chairman investors out of Treasurys into Ben Bernanke will describe it Friday other, riskier securities. Like stocks. when he elaborates on his latest That seems plausible. Since Mr. ...And the rest of Europe's blue chips 9000 plan for resuscitating the U.S. Bernanke confirmed on Aug. 27 that 16 23 30 6 13 20 27 3 10 17 24 1 8 Latest, Latest, Aug. Sept. Oct. economy. But that’s what happens the Fed was thinking about QE2, in local STOCK PERFORMANCE in local STOCK PERFORMANCE when the Fed turns up its electronic the Dow Jones Industrial Average Company/Country (Industry) Volume currency Latest YTD 52-week Company/Country (Industry) Volume currency Latest YTD 52-week Note: Price-to-earnings ratios are for trailing 12 months printing presses, creates money and has risen more than 10% and the ING Groep 21,276,748 7.94 3.39% 15.1% -17.2% UniCredit 225,642,031 1.89 2.05% -15.5% -28.2% buys hundreds of billions in U.S. yield on 10-year Treasurys has Netherlands (Life Insurance) Italy (Banks) DJIA component stocks AXA 10,337,160 13.78 3.30 -16.7 -27.6 Credit Suisse Group 9,084,685 43.25 1.88 -15.5 -28.4 Treasury debt, as it is poised to do. fallen. If markets thought the France (Full Line Insurance) Switzerland (Banks) Volume, CHANGE Brian L. Frank for The Wall Street Journal That’s how “quantitative easing,” or economy was getting better, stocks Siemens 4,354,403 79.79 3.25 24.3 15.6 ENI 16,213,836 16.18 1.83 -9.1 -9.3 Stock Symbol in millions Latest Points Percentage Software engineer Robby Obaya with his dog Ginger at the Zynga Game Network offices in San Francisco. QE, works. and bond yields would be up. The Germany (Diversified Industrials) Italy (Integrated Oil & Gas) AT&T T 18.9 $28.50 0.11 0.38% Banco Santander 57,932,174 9.59 3.13 -17.0 -15.8 BP PLC 29,230,653 436.95 1.82 -27.2 -21.8 Alcoa AA 33.1 13.36 0.16 1.21 Why is he doing this? unusual combination is seen by the Spain (Banks) U.K. (Integrated Oil & Gas) Unemployment is way above the Fed as confirmation that QE2 might AmExpress AXP 18.8 39.27 0.73 1.89 Anheuser-Busch InBev N.V. 3,120,976 45.85 3.08 26.0 38.6 L.M. Ericsson Telephone Series B 9,229,600 73.20 1.81 11.1 2.8 BankAm BAC 168.8 13.28 –0.24 –1.78 Fed’s target; inflation is a bit below work as hoped. Higher stock prices, Belgium (Beverages) Sweden (Communications Technology) Boeing BA 5.6 71.48 1.26 1.79 and perhaps falling further. When it figures, make households richer Nokia 29,691,997 8.09 2.93 -9.3 -21.5 SAP AG 4,584,080 37.95 1.80 15.0 8.2 Finland (Telecommunications Equipment) Germany (Software) Caterpillar CAT 7.9 80.27 0.93 1.17 cutting short-term interest rates and business executives perkier. BNP Paribas 4,561,719 54.00 2.84 -3.4 -3.5 France Telecom 7,300,753 16.18 1.76 -7.2 -9.0 Chevron CVX 10.7 83.69 –0.15 –0.18 Technology start-ups nearly to zero didn’t revive the The Fed hopes they’ll spend more France (Banks) France (Fixed Line Telecommunications) CiscoSys CSCO 65.1 23.18 0.56 2.48 economy, the Fed bought $1.75 as a result. Allianz SE 2,529,198 86.51 2.61 -0.7 -1.8 Diageo 4,174,883 1,143 1.69 5.4 19.6 CocaCola KO 11.4 59.95 0.35 0.59 Germany (Full Line Insurance) U.K. (Distillers & Vintners) trillion in U.S. Treasurys and That’s not the whole story. Disney DIS 13.7 34.92 0.44 1.28 ABB Ltd. 7,273,191 21.59 2.57 11.1 -0.2 Deutsche Telekom 16,775,282 10.05 1.63 -2.4 6.0 mortgages to reduce long-term When the Fed prints more dollars, Switzerland (Industrial Machinery) Germany (Mobile Telecommunications) DuPont DD 5.5 46.88 0.59 1.27 interest rates. In the spring, it the price of dollars falls—in euros, UBS 14,742,265 17.64 2.56 9.9 -8.1 Royal Dutch Shell A 5,264,437 22.70 1.43 7.6 13.2 ExxonMobil XOM 21.3 65.03 0.33 0.51 rested. It figured all that it had yen, Brazilian reais. That’s not the Switzerland (Banks) U.K. (Integrated Oil & Gas) GenElec GE 57.9 17.29 0.09 0.55 buoy San Francisco BASF SE 5,284,355 49.71 2.53 14.4 22.4 Hennes & Mauritz AB Series B 2,777,323 241.90 1.43 21.7 18.6 HewlettPk HPQ 24.5 42.21 0.86 2.08 done plus the Obama fiscal stimulus Fed’s chief objective, but it’s a fact. Germany (Commodity Chemicals) Sweden (Apparel Retailers) HomeDpt HD 14.0 30.99 –0.42 –1.34 had saved the economy from A cheaper dollar makes U.S. exports Roche Holding 2,778,021 139.10 2.51 -20.9 -17.9 HSBC Holdings 29,221,713 671.10 1.19 -5.3 -7.2 BY PUI-WING TAM shown fits and starts of revival mercial real estate. Tech companies calamity. It hoped business and more attractive, and helps the U.S. Switzerland (Pharmaceuticals) U.K. (Banks) Intel INTC 170.3 19.24 –0.53 –2.68 IBM IBM 8.3 140.36 0.51 0.36 AND NICK WINGFIELD since then, city officials and entre- are seeking 1.3 million square feet of consumer spending would take export more while American BG Group 8,056,341 1,172 2.40 4.4 2.4 Vodafone Group 125,871,450 163.90 1.11 14.1 21.0 U.K. (Integrated Oil & Gas) U.K. (Mobile Telecommunications) preneurs said the current level of space—either to expand or set up over. shoppers are spending less. Two JPMorgChas JPM 68.1 39.85 –0.55 –1.36 Bayer AG 3,729,396 54.94 2.39 -1.8 12.6 Zurich Financial Services AG 726,233 231.50 1.09 2.2 -9.0 JohnsJohns JNJ 9.3 63.59 0.30 0.48 SAN FRANCISCO—San Francisco tech activity is among the most sus- shop here— and make up 30% of the Now, the Fed is saying: We problems: One, no one else, Germany (Specialty Chemicals) Switzerland (Full Line Insurance) KftFoods KFT 6.1 31.50 0.35 1.12 is enjoying a renaissance as a tech- tained in San Francisco in a decade. current demand for office space, ac- stopped prematurely. It reasons especially the Chinese, is Total S.A. 6,586,566 38.90 2.38 -13.6 -7.2 Daimler AG 5,631,173 47.94 1.08 28.8 36.6 McDonalds MCD 4.3 75.75 0.17 0.22 nology center as numerous Web and “After the dot-com implosion, cording to Colliers International. In- that if the government did more to volunteering to let their currency France (Integrated Oil & Gas) Germany (Automobiles) Banco Bilbao Vizcaya Argentaria 31,621,400 9.93 2.37 -22.0 -20.3 Societe Generale 4,245,270 43.03 1.03 -12.1 -10.5 Merck MRK 8.6 37.16 0.52 1.42 digital-media companies move in or everyone had an alternative” for vestors are pouring money into the juice the economy now, rise against the dollar. Two, a Spain (Banks) France (Banks) Microsoft MSFT 73.7 25.34 0.51 2.05 expand in a burst of economic activ- where to locate, said San Francisco city’s start-ups, with venture capi- unemployment would fall, as would cheaper dollar tends to mean higher E.ON AG 11,150,455 21.63 2.37 -26.0 -19.7 Novartis 4,976,175 57.35 0.97 1.5 11.0 Pfizer PFE 47.3 17.73 0.25 1.44 ity not seen since the dot-com boom Mayor Gavin Newsom. “Now, jobs talists putting $528 million into San the risk of deflation, a debilitating oil prices. Still, the models on which Germany (Multiutilities) Switzerland (Pharmaceuticals) ProctGamb PG 8.5 62.63 0.61 0.98 Telefonica 32,944,413 19.34 2.33 -0.9 0.8 GlaxoSmithKline 8,086,077 1,319 0.96 -0.1 4.7 3M MMM 2.8 89.15 1.00 1.13 of the 1990s. are chasing people.” Francisco companies in the second decline in prices and wages. That the Fed relies suggest a weaker Spain (Fixed Line Telecommunications) U.K. (Pharmaceuticals) TravelersCos TRV 3.7 53.39 0.57 1.08 While there has long been plenty Mr. Newsom said Zynga’s new quarter, more than triple the $164 diagnosis is important. As the dollar is a net plus for U.S. growth. Sanofi-Aventis 3,355,041 50.00 2.32 -9.2 -6.2 British American Tobacco 1,817,867 2,434 0.95 20.7 23.2 of high-tech ferment 30 miles to the lease is the first in a series of office- million in the same period a year German central banker Axel Weber OK, if this is such a good idea, France (Pharmaceuticals) U.K. (Tobacco) UnitedTech UTX 4.5 74.19 1.21 1.66 south in Silicon Valley, San Fran- space deals with Web companies he earlier, according to research firm argued this week: If a central bank why so much hesitancy and Intesa Sanpaolo 94,872,440 2.54 2.22 -19.5 -19.8 Unilever 5,233,882 21.40 0.92 -5.9 4.9 Verizon VZ 21.5 32.20 –0.34 –1.04 Italy (Banks) Netherlands (Food Products) cisco itself has traditionally been expects to be announced in coming VentureSource. thinks unemployment is controversy? Because no one is sure WalMart WMT 12.4 53.81 –0.11 –0.20 the region’s finance and cultural weeks. Overall, there are now some San Francisco now rivals Silicon “structural”—workers don’t have it’ll work, and everyone knows Sources: Thomson Reuters Source: WSJ Market Data Group center rather than a tech magnet. 500 tech companies in San Fran- Valley for hot start-ups, some inves- the skills employers need or won’t there’ll be unwelcome, unintended Now, the city is seeing growth from cisco, according to the city’s Office tors say. “The growth rate of excit- move to where the jobs are, or if consequences. The first round of QE start-ups such as the microblogging of Economic and Workforce Devel- ing companies is happening more in consumers won’t spend for fear of was easier: The economy was service Twitter Inc. and the social- opment. The activity is crucial for San Francisco than elsewhere,” said future tax increases or pension collapsing. Credit derivatives Credit-default swaps: European companies gaming company Zynga Game Net- San Francisco, which is projecting a George Zachary, a venture capitalist cuts—a central bank can and should Among the risks: One, the more Tracking Spreads on credit derivatives are one way the market rates Atitsmostbasic,thepricingofcredit-defaultswapsmeasureshowmuchabuyerhastopaytopurchase-and work Inc. budget shortfall of about $450 mil- at Charles River Ventures in Menlo do nothing. But after weekend bonds the Fed buys, the harder it’ll creditworthiness. Regions that are treading in rough waters can see Late last month, Zynga an- lion for the 2011-12 fiscal year. Park, Calif. Of the 16 companies he meetings in Washington, Mr. Weber be to sell them someday without how much a seller demands to sell-protection from default on an issuer's debt. The snapshot below gives a spreads swing toward the maximum—and vice versa. Indexes below sense which way the market was moving yesterday. nounced a seven-year lease for a And with the city’s unemploy- has recently given “seed” financing said: “My reading of U.S. colleagues’ shaking up the markets and the credit are for five-year swaps. 270,000-square-foot space in the ment rate at 9.7% in August, tech to, Mr. Zachary said, about 10 are judgment is that when it comes to economy, a major worry for some South of Market neighborhood, one companies have fueled pockets of located in the city. the strong increase in the at the Fed, less so for Mr. Bernanke. Markit iTraxx Indexes SPREAD RANGE, in pct. pts. Mid-spread, since most recent roll Showing the biggest improvement... And the most deterioration of San Francisco’s biggest commer- job growth, with a 50% increase in The activity doesn’t span all ar- unemployment rate, a large Two, easy money leads investors markets Index: series/version in pct. pts. Mid-price Coupon Maximum Minimum Average CHANGE, in basis points CHANGE, in basis points cial-rental deals in years. the number of software jobs and eas of tech; computer-hardware part...must be perceived as being to take excessive risks. The searing Europe: 14/1 1.01 99.95% 0.01% 1.18 0.98 1.09 Yesterday YesterdayFive-day 28-day Yesterday YesterdayFive-day 28-day At the same time, the city’s de- more than a 20% jump in Internet makers still gravitate to Silicon Val- [cyclical] rather than structural.” memory of the crisis may restrain Eur. High Volatility:14/1 1.58 97.29 0.01 1.79 1.55 1.69 TUI AG 624 –15 –39 –57 UPM Kymmene 246 6 –10 –4 sign talent, cheaper office rents and publisher jobs for the 18 months ley, which has no equal for engi- And what is cyclical is susceptible some investors. Mr. Bernanke says dealmakers Europe Crossover:14/1 4.64 101.49 0.05 5.37 4.53 5.00 Wendel 353 –9 –34 –83 Nielsen 318 7 –7 8 mix of amenities are drawing an in- ended in late 2009, according to Ted neering talent, and start-ups that to monetary stimulus, he said. the Fed failed to police the banks Asia ex-Japan IG:14/1 1.04 99.80 0.01 1.25 1.03 1.15 Sol Melia SA 583 –6 –43 –122 Portugal Telecom SGPS SA 226 8 –4 51 flux of smaller tech firms, such as Egan, chief economist in San Fran- move north aren’t as close to poten- The Fed is reluctant to wheel when it kept rates low for a long Japan: 14/1 1.02 99.91 0.01 1.07 0.97 1.02 Fresenius SE 210 –5 –22 –39 Portugal Telecom Intl Fin BV 226 8 –6 51 the social-gaming start-up Booyah cisco’s Controller’s Office. tial partners such as Facebook Inc. out the howitzers again. It would time in the 2000s. He vows to do Note: Data as of October 12 Bco Pop Espanol 285 –4 –14 –12 Gas Nat SDG SA 191 9 –6 12 Inc. and help-desk software start-up The influx is also buoying com- in Palo Alto. prefer Congress and the president better this time, scrutinizing both In percentage points C de Aho Y Monte de Piedad Spreads 321 –2 –10 –17 Zendesk Inc. agreed to a short-term jolt of fiscal banks and others to spot imprudent Index roll de Madrid Bco Espirito Santo SA 425 9 –28 36 2.00 ING Verzekeringen NV 200 –2 –10 –43 EDP Energias de Portugal “San Francisco is absolutely be- stimulus packaged with credible bets early. That won’t be easy. Spreads on five- SA 255 12 –26 32 Japan French Rep 72 –2 –8 –4 coming ground zero for mobile and changes to spending and taxes to Three, the Fed—so focused on year swaps for 1.50 Rep Portugal 398 12 –9 56 Growing field MORE THAN t Ladbrokes 287 –1 –28 –37

Web start-ups,” said John Hering, reduce future budget deficits. But, unemployment and inflation—is corporate debt; Rep Irlnd 440 16 159 t 1.00 Evonik Degussa GmbH 59 –1 –3 –7 chief executive officer of Lookout Increase in the number of 800 as former Fed Vice Chairman based on Markit Dixons Retail 549 17 –2 4 paying too little attention to the Australia Mobile Security, a 35-person com- information-technology jobs in San Donald Kohn put it recently, fiscal possibility that it is sowing the iTraxx indexes. 0.50 Source: Markit Group pany that arrived from Los Angeles Francisco, from second quarter 2008 policy is “hamstrung.” So the Fed is seeds of future financial instability. in January. to fourth quarter 2009 stepping in. The last round of easy money is 0 Behind Asia's deals: Bank revenue rankings, North Asia It isn’t clear how sustainable San So how is this supposed to blamed for a global credit binge May June July Aug. Sept. Oct. MORE THAN 2010 Francisco’s tech boom is, especially work? In any market, when and, by some, the housing bubble. Behind every IPO, bond offering, merger deal or syndicated loan is one or more investment banks. Here are since start-ups are by definition un- 500 someone with big bucks starts What will this one yield? Source: Markit Group investment banks ranked by year-to-date revenues from recent deals. MORE THAN proven. Many of the Web-based buying, the price goes up. If the Fed Fourth, the Fed wouldn’t mind a PERCENTAGE OF TOTAL REVENUE ones aren’t yet generating revenue, 400 buys, say, another $500 billion of little more inflation; it doesn’t want Revenue, Market Equity Debt Mergers & in millions share capital markets capital markets acquisitions Loans much less profit. And most rely U.S. Treasurys, bond prices will go a lot. But inflation expectations are China International Capital Corp Ltd$216 4.4% 68% 26% 6% ... largely on the same venture capital- up and thus bond yields will fall. hard to calibrate precisely. Bank of China Ltd 202 4.1 43 46 2 9% ists, so if funding dried up, the im- Economists estimate that would Mr. Bernanke and QE2 skeptics MORE THAN CITIC Securities 202 4.1 72 26 2 ... pact would be widely felt. shave perhaps 0.13 to 0.20 have the same list of benefits and Goldman Sachs 195 4.0 68 16 15 ... During the dot-com boom, when 100 percentage point off the yield on 10- risks, but weigh them differently. WSJ.com Morgan Stanley 191 3.9 63 8 28 ... San Francisco was sprouting Inter- year Treasurys, small but He thinks the risks are worth taking Ping An Securities Co Ltd 181 3.7 95 4 1 ... net companies such as Pets.com Intellectual- Information- Internet Software significant with yields now around to avoid what might otherwise be Follow the markets throughout the day, with updated stock Inc., the ferment spawned tech- property technology publishers 2.46%. Because other bond markets years of stagnation, unemployment quotes, news and commentary at WSJ.com. UBS 158 3.2 64 21 15 ... transactions services JPMorgan 154 3.1 59 22 19 ... filled enclaves before a tbust in move with Treasurys, that means and deflation jitters. Also, receive emails that summarize the day’s trading in Eu- Deutsche Bank 138 2.8 54 18 28 ... 2000 and 2001 wiped out many of Source: U.S. Labor Dept. via City and County of San Francisco Office of the Controller rope and Asia. To sign up, go to WSJ.com/Email. the companies. While the sector has Source: Dealogic 24 THE WALL STREET JOURNAL. Thursday, October 14, 2010 Thursday, October 14, 2010 THE WALL STREET JOURNAL. 9 MARKETS WORLD NEWS U.K. banks to aid High yield’s losers: Chinese letter reflects rift on reform small businesses BY JEREMY PAGE what result will come of it in the end. From Wen Jiabao’s recent com- SHENZHEN, China—A letter ments, it seems that he is advocat- BY PATRICIA KOWSMANN pressure on the banking sector to restructuring firms signed by nearly two dozen Chinese ing political reform.” Other signato- ratchet up lending. Communist Party elders blasting the ries included Hu Jiwei, a former LONDON—The U.K.’s largest The British Chambers of Com- government’s clampdown on free ex- editor of the People’s Daily, the offi- banks will set up a £1.5 billion merce, which represents local busi- pression is drawing attention to an cial Communist Party mouthpiece, ($2.37 billion) fund to help small nesses, welcomed the fund, but said BY LIAM VAUGHAN manent fix. While it allows a com- to 1,648 in the first nine months of intensifying discussion over political and Li Pu, a former deputy head of businesses, amid criticism that they the plan will only reach “the minor- pany to pay off existing loans, the the year, from 2,589 in the same pe- reform in the run-up to a major the official Xinhua news agency. aren’t lending enough. ity of SME businesses seeking eq- The wave of corporate restruc- firm may need to refinance again riod last year, according to profes- leadership conclave. Both are in their 90s. Six banks—HSBC Holdings PLC, uity investment.” turings that was expected in the af- when the bonds mature, and there is sional-services firm Deloitte. The signatories—including a for- The signatories are mostly Royal Bank of Scotland Group PLC, “We need to remember that termath of the financial crisis has no guarantee demand for its debt But restructuring firms could be- mer secretary to Mao Zedong—say known reformists, who have made Lloyds Banking Group PLC, Bar- many businesses are not seeking eq- slowed to a crawl due to a surge in will be as high at that point. come busier as debt issued by the letter was inspired by Premier similar appeals before, and their po- clays PLC and the U.K. arm of uity investment—so the improve- investors’ appetite for high-yield “Replacing one form of debt with highly leveraged companies matures Wen Jiabao’s surprise call for politi- litical influence is limited now be- Spain’s Banco Santander SA—will ment of lending processes and busi- debt, which is allowing companies another can help companies buy beginning next year. Thomson Reut- cal reform in the southern city of cause of their age. each contribute to the “business ness-bank relationships must be the to refinance without a painful re- time, but it is ultimately a sticking- ers data suggest the total amount of Shenzhen in August, and is intended But their letter is still likely to growth fund,” to be built over “a focus of any reform effort,” it said. structuring. plaster solution,” said Caroline Sil- debt due to mature by 2017 stands to encourage reformists in the party fuel public debate about political re- number of years,” a task force In a document delivered Wednes- High-yield debt issuance in Eu- ver, managing director at Moelis & at $1 trillion globally. who want to gradually loosen its form in China this year, as the party headed by Barclays Chief Executive day to the U.K. Treasury, the banks rope stands at $42.6 billion so far Company and the former vice chair- Because lending banks may be grip on society by allowing the me- struggles to find a way to maintain John Varley said in a statement also pledged to establish a round ta- this year—a record for this stage in unlikely to renew loan agreements dia to report freely and by halting economic growth at the same time Wednesday. ble where senior bank representa- the year and already well ahead of that involve high levels of leverage Internet censorship. as addressing an increasingly com- The fund will buy a minimum tives will meet regularly with busi- the $38.2 billion issued in all of Europe’s high-yield debt and the investor pool in high-yield The letter was published online plex array of social problems. 10% stake in companies with annual ness groups to discuss concerns. 2009, according to data provider debt is too small to take up the this week as the party’s 371-member An early sign of the debate came sales of between £10 million and In addition, the banks “will put Dealogic. deals total $42.6 billion so slack, companies will be forced to Central Committee prepared for a when Premier Wen wrote an unusual £100 million and equity funding re- in place a new, transparent and in- This availability of plentiful far this year, well ahead of renegotiate terms with their credi- three-day meeting, starting Friday, editorial in April praising Hu Yao- quirements of between £2 million dependently monitored appeals pro- credit has meant companies that tors, restructuring specialists said. which is expected to decide the di- bang, the reformist party chief who and £10 million. cess for customers who believe a may have struggled to survive dur- the amount for all of 2009. As advisers to either companies or rection of economic and political was ousted by conservatives in 1987, The government welcomed the bank’s decisions are in breach of its ing difficult times are now able to creditors in such a situation, re- policies ahead of a leadership and whose death helped inspire the

move but said it was only a first lending principles,” it said. get funds without being forced into structuring firms will be busy. change in 2012. Agence France-Presse/Getty Images pro-democracy protests around Ti- step. In a joint statement, Treasury The task force said all commit- administration or other restructur- man of investment banking for Eu- “Generally, the low-interest-rate It also comes as the party grap- Li Rui, above, in 2006, and Jiang Ping, below, in September, signed the letter calling for more media freedom. Mr. Li, Mao ananmen Square in 1989. Chief George Osborne and Business ments are expected to be fully im- ing process. rope, the Middle East and Africa at environment and comprehensive ples to contain the fallout from the Zedong’s former secretary, said, ‘From Wen Jiabao’s recent comments, it seems that he is advocating political reform.’ Mr. Wen later surprised many Secretary Vince Cable said they had plemented by the summer of 2011. While this is good news for com- Bank of America Merrill Lynch. cost cutting at [corporations] has Nobel Peace Prize awarded last Fri- observers with a speech in Shenzhen been “absolutely clear that banks Bank of England Governor panies, it is less so for restructuring “Unless companies successfully curbed a huge flow of out-and-out day to Liu Xiaobo, a Chinese dissi- Conservatives, by contrast, warn in August, in which he said: “With- need to improve the lending envi- Mervyn King has been one of the firms, which specialize in advising grow their businesses or replace restructurings,” said Richard Sta- dent who was sentenced to 11 years that any such moves could lead to From the letter out the safeguard of political reform, ronment for small businesses.” fiercest critics of the sector’s per- struggling companies and their some of the debt with equity, the bles, co-global and co-European in prison in December for writing a social unrest, and ultimately, the the fruits of economic reform would “This is an important first step ceived reluctance to lend. He re- creditors. It also is making life diffi- fundamental issue remains,” Ms. Sil- head of restructuring at Lazard Ltd. manifesto calling for freedom of ex- party’s overthrow. Our core demand is that the be lost and the goal of moderniza- and we welcome it. It is important cently told lawmakers the current cult for vulture funds, which buy ver said. “Pressures will come when facili- pression and multiparty elections. The way the letter was pub- system of censorship be dismantled tion would not materialize.” that the banks now deliver on these lending targets agreed by the gov- distressed debt at a discount to face For now, however, many compa- ties come due and highly leveraged China’s giant strides toward eco- lished—on the microblogging service in favor of a system of legal His remarks were seen as an en- plans,” they said. ernment, and partly state-owned value in the hope that the price will nies are gaining breathing space. companies find it difficult to refi- nomic opening haven’t been of the Chinese website responsibility. dorsement of political reforms that However, a person familiar with RBS and Lloyds, are “not effective.” rise over time. Administration proceedings in the nance at the same multiples,” Mr. matched by any significant moves www.sina.com—also demonstrates have been pioneered since 2005 in the situation said Wednesday’s —Laurence Norman To be sure, issuing a five-year or U.K., which let companies restruc- Stables said. toward political liberalization. In- the power of the Internet in China to There are no more taboos Shenzhen, including slashing a third promise wouldn’t end government contributed to this article. 10-year bond isn’t necessarily a per- ture rather than shut down, fell 36% —More at efinancialnews.com deed, many analysts see a new advance political freedoms. In much concerning our Party’s history. of all government departments and model developing in China: authori- the same way, Mr. Liu’s wife, Liu Xia, Chinese citizens have a right to relaxing restrictions on business as- tarian state capitalism that delivers used Twitter on Wednesday to pro- know the errors of the ruling party. sociations, charities and other non- Advertisement [ INTERNATIONAL INVESTMENT FUNDS www.wsj.com/funddata ] Advertisement rapid growth and clamps down on test the house arrest she has been governmental organizations. political dissent in the name of so- under since her husband’s award. The Internet is an important “We’ve achieved a lot through cial stability. The elders’ letter, which was discussion platform for information economic reform in the last 30 NAV —%RETURN— NAV —%RETURN— NAV —%RETURN— NAV —%RETURN— FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR The media, meanwhile, remains signed Oct. 1 and first published in our society and the voice of years, but we now have to do the largely muzzled in its efforts to act citizens’ views. … Internet Andfs. Emergents GL EQ AND 10/12 USD 17.91 3.2 8.0 33.3 www.parexgroup.com Tel: +371 67010810 n Hemisphere Management (Ireland) Limited Eq. Global A GL EQ LUX 10/11 USD 29.24 5.0 7.4 19.4 Monday, although not circulated same in the political, social and cul- Andfs. Espanya EU EQ AND 10/12 EUR 12.32 -11.5 -8.4 8.7 Parex Eastern Europ Bal OT OT LVA 10/12 EUR 15.29 14.4 16.2 14.7 Discovery USD A OT OT CYM 08/31 USD 107.82 10.8 12.5 12.2 Eq. 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US Lg Cap Gr A US EQ LUX 10/11 USD 15.76 3.3 8.5 16.4 nunciation of Mr. Liu’s prize as part form faction among senior leaders But its release shortly after his residents of a colony.” local media more freedom to moni- Andorfons Mix 30 EU BA AND 10/12 EUR 9.75 2.0 2.8 6.6 n PICTET & CIE, ROUTE DES ACACIAS 60, CH-1211 GENEVA 73 Indonesian Grth Fund GL EQ BMU 10/06 USD 179.99 41.3 51.9 51.6 Eq. US Mid Cap A US EQ LUX 10/11 USD 33.68 12.7 17.4 28.4 Andorfons Mix 60 EU BA AND 10/12 EUR 9.18 -0.9 0.6 4.4 Tel: + 41 (58) 323 3000 Web: www.pictetfunds.com Eq. US Multi Strg A US EQ LUX 10/11 USD 22.39 5.3 8.4 15.8 of a conspiracy by Western coun- to implement reform within the sys- prize highlights many of the same Among the signatories was Li tor the government, and forming an Eq. US Rel Val A US EQ LUX 10/11 USD 21.21 3.0 4.9 13.7 Pictet-Agriculture-P EUR GL EQ LUX 10/12 EUR 140.00 15.5 31.7 NS n RUSSELL INVESTMENT GROUP n CHARTERED ASSET MANAGEMENT PTE LTD - TEL NO: 65-6835-8866 Eq. US Sm Cap Val A US EQ LUX 10/11 USD 16.86 5.7 3.6 5.0 tries to impose their values on China tem,” said Xiao Mo, former head of issues raised by the Nobel Commit- Rui, Chairman Mao’s former secre- anticorruption body along the lines Pictet-Asian Eq ExJpn-I USD AS EQ LUX 10/13 USD 192.55 9.8 15.4 26.0 Multi-Style, Multi-Manager Funds www.russell.com Fax No: 65-6835 8865, Website: www.cam.com.sg, Email: [email protected] Money Market EURO A EU MM LUX 10/11 EUR 27.47 0.3 0.4 1.1 Pictet-Asian Eq ExJpn-P USDAS EQ LUX 10/13 USD 182.05 9.1 14.5 24.9 ACTION FRANCE A EU EQ IRL 10/12 EUR 697.93 -1.3 0.4 10.3 and undermine its rise. It suggests the Architecture Research Center of tee and Mr. Liu. tary and biographer, who is also a of Hong Kong’s Independent Com- CAM-GTF Limited AS EQ MUS 10/01 USD 390326.21 42.2 72.1 45.0 Money Market USD A US MM LUX 10/11 USD 15.87 0.2 0.2 0.6 Pictet-Biotech-P USD OT EQ LUX 10/12 USD 283.87 0.3 -1.5 2.4 CORE EUROZONE EQ B EU EQ IRL 10/12 EUR 833.77 0.3 1.0 13.3 that some figures within the party the Chinese National Academy of “We have for 61 years ‘served as former member of the Central Com- mission Against Corruption. n DJE INVESTMENT S.A. Pictet-CHF Liquidity-P CH MM LUX 10/12 CHF 124.13 -0.1 -0.1 0.2 EURO FIXED INCOME A EU BD IRL 10/12 EUR 1361.07 9.3 11.0 9.0 Pictet-CHF Liquidity-P dy CH MM LUX 10/12 CHF 93.34 -0.1 -0.1 0.2 EURO FIXED INCOME B EU BD IRL 10/12 EUR 1460.14 9.9 11.7 9.6 internet: www.dje.lu email: [email protected] phone:+00 352 269 2522 0 fax:+00 352 269 25252 are looking to Premier Wen, 68, as Arts. master’ in the name of the citizens mittee and a onetime deputy head of Beyond Shenzhen, the speech Pictet-Conv. Bonds-P EUR EU BD LUX 10/12 EUR 100.40 NS NS NS EUROPEAN SMALL CAP A EU EQ IRL 10/12 EUR 1395.82 16.2 17.5 19.8 DJE Real Estate P OT EQ LUX 10/13 EUR 8.95 1.1 1.0 -2.7 Pictet-Digital Comm-P USD OT EQ LUX 10/12 USD 133.71 14.4 21.6 35.9 EUROPEAN SMALL CAP B EU EQ IRL 10/12 EUR 1502.17 16.8 18.2 20.5 the figurehead of a reformist faction He and other signatories said the of the People’s Republic of China,” the party’s powerful Organization was seen as a call to expand political DJE-Absolut P GL EQ LUX 10/13 EUR 215.02 5.0 8.4 8.5 Pictet-Eastern Europe-P EUREU EQ LUX 10/12 EUR 373.59 18.8 23.1 36.8 EUROZONE AGG A EUR EU EQ IRL 10/12 EUR 696.50 6.2 5.2 16.3 DJE-Alpha Glbl P EU BA LUX 10/13 EUR 179.42 0.7 2.9 6.8 that wants competitive internal elec- letter wasn’t connected to Mr. Liu, the letter says. “But the freedom of Department. reforms to the rest of the country in Pictet-Emerging Markets-P USDGL EQ LUX 10/13 USD 586.61 10.0 14.7 32.9 EUROZONE AGG B EUR EU EQ IRL 10/12 EUR 1005.63 6.7 5.8 17.0 DJE-Div& Substanz P EU EQ LUX 10/13 EUR 227.43 5.7 9.3 15.6 Pictet-Eu Equities Sel-P EUREU EQ LUX 10/12 EUR 427.99 4.9 8.6 14.7 GLB REAL EST SEC A OT EQ IRL 10/12 USD 1031.60 15.0 18.9 14.6 tions, and greater media freedom, to the 54-year-old former literature speech and of the press we now en- When asked what he expected the same way economic reforms DJE-Gold&Resourc P OT EQ LUX 10/13 EUR 215.54 26.5 27.7 33.5 n THE NATIONAL INVESTOR Pictet-EUR Bonds-P EU BD LUX 10/12 EUR 413.70 7.6 7.7 6.4 GLB REAL EST SEC B OT EQ IRL 10/12 USD 1068.53 15.6 19.7 15.3 PO Box 47435, Abu Dhabi, UAE Web:www.tni.ae help fight corruption and address professor who was awarded the No- joy is inferior even to that of Hong the letter to achieve, Mr. Li, who is spread across China over the past DJE-Renten Glbl P EU BD LUX 10/13 EUR 136.42 4.5 5.3 7.7 GLB REAL EST SEC EH A OT EQ IRL 10/12 EUR 895.53 11.3 15.8 8.9 Pictet-EUR Bonds-Pdy EU BD LUX 10/12 EUR 303.37 7.6 7.7 6.4 MENA Real Estate Fund OT OT BMU 09/30 USD 839.62 -12.6 -22.0 -21.3 LuxPro-Dragon I AS EQ LUX 07/20 EUR 144.57 -8.5 5.0 7.6 GLB REAL EST SEC SH B OT EQ IRL 10/12 GBP 84.93 12.1 16.7 9.0 Pictet-EUR Corporate Bonds-PEU BD LUX 10/12 EUR 158.21 7.0 8.7 14.2 MENA Special Sits Fund OT OT BMU 09/30 USD 1138.03 5.4 -0.2 6.8 urgent social problems. bel Peace Prize on Friday for his Kong before its return to Chinese in his 90s, said: “It’s hard to say three decades. LuxPro-Dragon P AS EQ LUX 07/20 EUR 140.29 -8.8 4.4 7.0 GLB STRAT YIELD A EU BD IRL 10/12 EUR 1811.28 12.7 17.6 21.9 Pictet-EUR Corporate Bonds-PdyEU BD LUX 10/12 EUR 107.25 7.0 8.7 14.2 UAE Blue Chip Fund OT OT ARE 09/30 AED 5.09 -4.5 -23.4 -23.8 LuxTopic-Aktien Europa EU EQ LUX 10/13 EUR 17.64 -0.4 2.9 15.5 GLB STRAT YIELD B EU BD IRL 10/12 EUR 1947.27 13.2 18.3 22.6 LuxTopic-Pacific AS EQ LUX 10/13 EUR 20.44 24.8 37.8 35.0 Pictet-EUR High Yield-P EU BD LUX 10/12 EUR 172.23 17.8 22.2 28.2 Pictet-EUR High Yield-Pdy EU BD LUX 10/12 EUR 94.40 17.8 22.1 28.2 GLOBAL BOND A EU BD IRL 10/12 EUR 1278.15 15.7 19.5 12.9 n HSBC ALTERNATIVE INVESTMENTS LIMITED Pictet-EUR Liquidity-P EU MM LUX 10/12 EUR 136.23 0.2 0.3 1.0 GLOBAL BOND B EU BD IRL 10/12 EUR 1367.63 16.2 20.2 13.6 GLOBAL BOND EH A GL BD IRL 10/12 EUR 1522.11 10.7 12.3 11.7 T +44 20 7860 3074 F + 44 20 7860 3174 www.hail.hsbc.com Pictet-EUR Liquidity-Pdy EU MM LUX 10/12 EUR 96.85 0.2 0.2 1.0 Pictet-EUR Sovereign Liq-P EU MM LUX 10/12 EUR 102.44 0.0 0.1 0.6 GLOBAL BOND EH B GL BD IRL 10/12 EUR 1623.23 11.2 13.0 12.4 Pictet-EUR Sovereign Liq-PdyEU MM LUX 10/12 EUR 99.95 0.0 0.0 0.6 JAPAN EQUITY A JP EQ IRL 10/12 JPY 10431.11 -10.4 -9.9 1.3 n HSBC Portfolio Selection Fund Pictet-Europe Index-P EUR EU EQ LUX 10/12 EUR 106.97 5.9 10.2 16.4 JAPAN EQUITY B JP EQ IRL 10/12 JPY 11170.31 -9.9 -9.3 2.0 PAC BASIN (X JPN) A AS EQ IRL 10/12 USD 2526.89 10.5 15.6 38.2 Crowds in Lebanon cheer Iranian leader’s arrival Sel Emerg Mkt Debt GL BD GGY 12/31 USD 350.10 42.6 54.7 6.4 Pictet-European Sust Eq-P EUREU EQ LUX 10/12 EUR 141.21 6.1 10.7 15.7 n YUKI INTERNATIONAL LIMITED PAC BASIN (X JPN) B AS EQ IRL 10/12 USD 2709.44 11.0 16.3 39.1 Sel Emerg Mkt Equity GL EQ GGY 12/31 USD 207.66 63.0 73.6 -11.3 Pictet-Glo Emerging Debt-P USDGL BD LUX 10/12 USD 274.12 12.7 11.6 26.8 Tel +44-207-269-0203 www.yukifunds.com PAN EUROPEAN EQUITY A EU EQ IRL 10/12 EUR 1026.82 6.7 8.5 17.3 Sel Euro Equity EUR OT OT GGY 12/31 EUR 96.29 32.6 27.0 -17.7 Pictet-Glo Emerging Debt-PdyGL USD BD LUX 10/12 USD 178.03 12.7 11.6 26.7 Sel European Equity EU EQ GGY 12/31 USD 181.94 42.7 49.9 -16.8 Pictet-Greater China-P USD AS EQ LUX 10/13 USD 384.58 9.5 17.7 29.9 PAN EUROPEAN EQUITY B EU EQ IRL 10/12 EUR 1099.79 7.2 9.1 18.0 BY MARGARET COKER Palestinian group Hamas and Hez- the Hezbollah-led opposition. Clinton said Wednesday. Sel Glob Equity GL EQ GGY 12/31 USD 189.25 35.2 42.1 -15.7 Pictet-Indian Equities-P USDEA EQ LUX 10/13 USD 447.97 24.2 25.9 40.4 US EQUITY A US EQ IRL 10/12 USD 903.09 3.5 7.1 15.2 n YMR-N Series Sel Glob Fxd Inc GL BD GGY 12/31 USD 143.46 11.4 15.8 -1.4 Pictet-Japan Index-P JPY JP EQ LUX 10/13 JPY 8155.21 -8.2 -6.5 0.5 US EQUITY B US EQ IRL 10/12 USD 971.44 4.0 7.8 15.9 YMR-N Growth Fund JP EQ IRL 10/13 JPY 8450.00 -10.7 -7.3 0.1 AND CHARLES LEVINSON bollah, which the U.S. deems terror- A key dispute is whether Leba- Mr. Ahmadinejad devoted signifi- US SMALL CAP EQUITY A US EQ IRL 10/12 USD 1395.99 8.3 11.1 15.2 Sel Pacific Equity AS EQ GGY 12/31 USD 143.75 68.5 80.5 -7.1 Pictet-Japanese Eq 130/30-PJP JPY EQ LUX 10/13 JPY 4128.69 -6.5 -4.7 2.3 YMR-N Small Cap Fund JP EQ IRL 10/13 JPY 6014.00 -14.2 -16.4 5.1 ist groups. non should continue its support for cant time in his speech to discussing Sel US Equity US EQ GGY 12/31 USD 123.56 24.0 30.0 -14.2 US SMALL CAP EQUITY B US EQ IRL 10/12 USD 1502.62 8.8 11.7 15.9 Pictet-Japanese Eq Sel-I JPY JP EQ LUX 10/13 JPY 7202.15 -7.0 -6.0 -2.2 n Sel US Sm Cap Eq US EQ GGY 12/31 USD 168.82 30.1 42.6 -14.8 Pictet-Japanese Eq Sel-P JPYJP EQ LUX 10/13 JPY 6950.70 -7.5 -6.6 -2.9 Yuki 77 Series BEIRUT—Iranian President Mah- “Our world today stands on the a United Nations tribunal investigat- oft-repeated topics: the need for Is- Pictet-MENA-P USD OT OT LUX 10/12 USD 51.86 15.7 1.0 NS Yuki 77 General JP EQ IRL 10/13 JPY 5185.00 -15.7 -16.4 -6.4 n HSBC Trinkaus Investment Managers SA moud Ahmadinejad offered Lebanon verge of change, a change that is ing the 2005 murder of Mr. Hariri’s lamic countries to build a unified Pictet-Pac (ExJpn) Idx-P USDAS EQ LUX 10/13 USD 303.25 11.0 13.7 32.8 n E-Mail: [email protected] Yuki Chugoku Series his country’s strong support in starting from our region,” Mr. Ah- father, former Prime Minister Rafik front against Israel, particularly Pictet-Piclife-P CHF CH BA LUX 10/12 CHF 793.97 0.4 1.5 7.2 Yuki Chugoku Jpn Gen JP EQ IRL 10/13 JPY 6036.00 -11.6 -8.6 -2.2 Telephone: 352 - 47 18471 Pictet-Premium Brands-P EUROT EQ LUX 10/12 EUR 83.64 28.0 39.2 32.4 Yuki Chugoku JpnLowP JP EQ IRL 10/13 JPY 6967.00 -7.6 -13.3 -2.3 fighting what he views as detrimen- madinejad told a crowd of thou- Hariri. Hezbollah is pressuring the now, as the Palestinians attempt to Prosperity Return Fund A JP BD LUX 10/11 JPY 10473.47 5.6 NS NS Pictet-Russian Equities-P USDEE EQ LUX 10/12 USD 72.19 12.1 13.8 48.4 n SG ASSET MANAGEMENT HTTP://WWW.SGAM.COM Prosperity Return Fund B EU BD LUX 10/11 JPY 9515.49 -3.7 NS NS Pictet-Security-P USD GL EQ LUX 10/12 USD 114.74 15.2 21.0 31.5 n Yuki Hokuyo Japan Series tal U.S. and Israeli influence in the sands of Hezbollah supporters and government to denounce the tribu- negotiate the creation of an inde- Prosperity Return Fund C EU BD LUX 10/11 USD 104.26 8.1 NS NS Pictet-Small Cap Europe-P EUREU EQ LUX 10/12 EUR 528.24 16.6 17.6 22.4 A company of Amundi Group Yuki Hokuyo Jpn Gen JP EQ IRL 10/13 JPY 3971.00 -15.0 -12.8 -6.9 Middle East, kicking off his first Shiite religious figures. “Lebanon is nal’s work amid rumors that mem- pendent state; and the desire to Prosperity Return Fund D EU BD LUX 10/11 EUR 112.95 15.7 NS NS Pictet-Timber-P USD GL EQ LUX 10/12 USD 113.61 6.6 16.1 17.2 Bonds ConvEurope A EU BD LUX 10/11 EUR 33.00 11.3 13.7 6.6 Yuki Hokuyo Jpn Inc JP EQ IRL 10/13 JPY 4592.00 -12.5 -11.5 -7.1 Renaissance Hgh Grade Bd A JP BD LUX 10/11 JPY 10488.09 6.0 NS NS Pictet-USA Index-P USD US EQ LUX 10/12 USD 95.81 5.7 9.8 15.5 Bonds Eur Corp A EU BD LUX 10/11 EUR 24.24 5.0 5.7 10.9 Yuki Hokuyo Jpn Sm Cap JP EQ IRL 10/13 JPY 4358.00 -14.6 -17.2 4.9 state visit to this Arab country with an example...for the unwavering re- bers of Hezbollah are likely to be in- strengthen an Islamic bloc of coun- Renaissance Hgh Grade Bd B EU BD LUX 10/11 JPY 9444.66 -4.2 NS NS Pictet-USD Government Bonds-PUS BD LUX 10/12 USD 553.48 9.0 7.9 6.5 Bonds Eur Hi Yld A EU BD LUX 10/11 EUR 23.06 12.0 14.2 23.8 a provocative message that cuts to sistance to the world’s tyrants and a dicted for the assassination. tries against what he views as a Renaissance Hgh Grade Bd C EU BD LUX 10/11 USD 102.76 7.6 NS NS Pictet-USD Government Bonds-PdyUS BD LUX 10/12 USD 395.75 9.0 7.9 6.5 Bonds EURO A EU BD LUX 10/11 EUR 43.44 5.8 5.5 7.4 n Yuki Mizuho Series Renaissance Hgh Grade Bd D EU BD LUX 10/11 EUR 107.65 10.6 NS NS Pictet-USD Liquidity-P US MM LUX 10/12 USD 131.20 0.1 0.1 0.6 Bonds Europe A EU BD LUX 10/11 EUR 41.44 6.0 5.8 7.0 Yuki Mizuho Gen Jpn III JP EQ IRL 10/13 JPY 3744.00 -15.3 -13.4 -9.1 the heart of the political disputes university for jihad.” Ahead of Mr. Ahmadinejad’s trip, threatening West. Pictet-USD Liquidity-Pdy US MM LUX 10/12 USD 84.96 0.1 0.1 0.6 Bonds US MtgBkSec A US BD LUX 04/29 USD 24.41 -4.7 11.9 0.0 Yuki Mizuho Jpn Dyn Gro JP EQ IRL 10/13 JPY 3948.00 -15.4 -15.8 -9.6 Pictet-USD Sovereign Liq-P US MM LUX 10/12 USD 101.62 0.1 0.1 0.4 Bonds World A GL BD LUX 10/11 USD 45.63 8.6 5.0 10.7 Yuki Mizuho Jpn Exc 100 JP EQ IRL 10/13 JPY 5864.00 -15.9 -12.3 -4.1 threatening the fragile coalition Lebanon has long been a battle- the first to Lebanon for an Iranian Israeli officials have kept a rela- Pictet-USD Sovereign Liq-PdyUS MM LUX 10/12 USD 100.12 0.1 0.1 0.4 Eq. AsiaPac Dual Strategies AAS EQ LUX 10/12 USD 11.17 7.2 11.5 30.1 Yuki Mizuho Jpn Gen JP EQ IRL 10/13 JPY 7683.00 -10.8 -10.5 -2.2 government. ground for the region’s powers. For head of state in seven years, the U.S. tively low profile during his two-day Pictet-Water-P EUR GL EQ LUX 10/12 EUR 134.56 8.6 17.2 14.3 Eq. China A AS EQ LUX 10/12 USD 24.46 1.4 9.7 35.3 Yuki Mizuho Jpn Gro JP EQ IRL 10/13 JPY 5652.00 -11.1 -10.9 -3.2 Pictet-World Gvt Bonds-P USDEU BD LUX 10/13 USD 179.78 8.9 6.0 9.7 Eq. Concentrated Euroland A EU EQ LUX 09/30 EUR 86.45 -7.0 -5.2 -3.5 Yuki Mizuho Jpn Inc JP EQ IRL 10/13 JPY 6820.00 -10.7 -9.3 -6.5 In a raucous evening rally orga- years it has been seen as a bell- and Israel expressed concern that visit to their northern neighbor. Eq. ConcentratedEuropeA EU EQ LUX 10/11 EUR 28.55 5.7 9.9 18.3 Pictet-World Gvt Bonds-Pdy USDEU BD LUX 10/13 USD 145.79 8.9 6.0 9.7 Yuki Mizuho Jpn Lg Cap JP EQ IRL 10/13 JPY 4498.00 -13.3 -11.9 -5.7 nized by Shiite militant group and wether for Iran’s drive to expand his visit could weaken Lebanon’s They fear that outspoken rhetoric Eq. Emerging Europe A EU EQ LUX 10/11 EUR 27.17 15.3 23.6 29.9 Yuki Mizuho Jpn LowP JP EQ IRL 10/13 JPY 10214.00 -11.7 -15.0 0.7 n MP ASSET MANAGEMENT INC. n POLAR CAPITAL PARTNERS LIMITED Eq. Equities Global Energy OT EQ LUX 10/11 USD 17.38 -4.2 -1.4 16.2 Yuki Mizuho Jpn PGth JP EQ IRL 10/13 JPY 6704.00 -15.8 -16.1 -7.5 Iranian ally Hezbollah, the Iranian the sphere of influence of Tehran fragile coalition government—with could undermine denunciations of Tel: + 386 1 587 47 77 International Fund Managers (Ireland) Limited PH - 353 1 670 660 Fax - 353 1 670 1185Eq. Euroland A EU EQ LUX 10/11 EUR 10.60 -2.1 0.6 8.6 Yuki Mizuho Jpn SmCp JP EQ IRL 10/13 JPY 6131.00 -14.1 -16.9 7.6 leader spoke of a balance of power and its revolutionary brand of Islam. Sunni, Christian and Shiite mem- the visit from other Arab leaders, MP-BALKAN.SI EU EQ SVN 10/12 EUR 19.99 -17.8 -29.8 -19.4 Global Technology OT EQ IRL 10/12 USD 15.72 16.9 27.3 38.1 Eq. Euroland MidCapA EU EQ LUX 04/30 EUR 14.61 1.4 -45.7 -33.8 Yuki Mizuho Jpn Val Sel AS EQ IRL 10/13 JPY 5036.00 -10.8 -11.1 -0.8

Yuki Mizuho Jpn YoungCo AS EQ IRL 10/13 JPY 2246.00 -17.6 -26.7 -2.3 Agence France-Presse/Getty Images MP-TURKEY.SI OT OT SVN 10/12 EUR 49.58 42.8 49.8 45.0 Japan Fund USD JP EQ IRL 10/13 USD 16.83 5.9 0.1 22.7 Eq. Euroland Small Cap A EU EQ LUX 10/11 EUR 156.55 10.9 9.5 24.2 in the region away from the U.S. and This ideological battle underpins bers—to the detriment of U.S. allies which, like Israel, see an expansion- Eq. EurolandCyclclsA OT EQ LUX 10/11 EUR 18.74 5.3 9.0 18.0 n PAREX ASSET MANAGEMENT IPAS Polar Healthcare Class I USD OT EQ IRL 10/12 USD 13.00 0.5 4.3 NS n Yuki Shizuoka Japan Series in favor of the Islamic Republic and many of the disputes dividing Leba- in the small country. ist Iran as a threat. Prime Minister Iranian President Mahmoud Polar Healthcare Class R USDOT EQ IRL 10/12 USD 12.92 0.1 3.8 NS Eq. EurolandFinancialA OT EQ LUX 10/11 EUR 10.23 -9.6 -16.5 -0.3 Republikas square 2a, Riga, LV-1522, Latvia Eq. Glbl Emg Cty A GL EQ LUX 10/11 USD 9.48 -2.1 0.7 24.3 Yuki Shizuoka General Japan JP EQ IRL 10/13 JPY 4837.00 -10.8 -10.6 -3.3 its regional allies—what he refers to non’s two political blocs: the U.S.- “We reject any efforts to destabi- Benjamin Netanyahu put out a state- Ahmadinejad, left, is greeted by as “the resistance bloc” that in- and Saudi-backed government led lize or inflame tensions within Leba- ment accusing Iran of preventing Lebanese President Michel Sleiman For information about listing your funds, please contact: Justin Jones tel: +44 0203 426 1167; email: [email protected] cludes Iran and Syria as well as the by Prime Minister Saad Hariri, and non,” U.S. Secretary of State Hillary peace between Israel and Lebanon. upon his arrival in Beirut Wednesday. 10 THE WALL STREET JOURNAL. Thursday, October 14, 2010 Thursday, October 14, 2010 THE WALL STREET JOURNAL. 23 WORLD NEWS MARKETS U.S. helps Lazard hires Stocks rally, dollar FUND SCORECARD China currency reserves surge Naguib Kheraj, Sector Equity Financial Services facilitate Funds that invest in equities of companies in the financial services sector. At least 75% of total assets are BY ANDREW BATSON invested in equities. Ranked on % total return (dividends reinvested) in U.S. dollars for one year ending former chief skids, gold surges October 13, 2010 AND AARON BACK On the rise again Kabul talks Leading 15 Performers BEIJING—China’s foreign-ex- BY ISHAQ SIDDIQI 2.475%. China's official reserves of foreign of Cazenove FUND FUND LEGAL % Return in $US ** change reserves swelled to $2.648 European energy and resource RATING *NAME FUND MGM'T CO. CURR. BASE YTD 1-YR 2-YR 5-YR currency, in billions of U.S. dollars trillion at the end of September, in BY NATHAN BECKER Stocks rallied as investors wel- stocks jumped after China’s trade 4 Sanlam Sanlam Asset Mgmt USDIRL 32.63 37.44 44.42 4.56 a record surge highlighting the ex- $2,500 with Taliban comed the prospect of more action surplus fell to a five-month low of Global Financial B (Ireland) Ltd tent of the nation’s intervention in Lazard Ltd. said it appointed by the Federal Reserve to prod the $16.88 billion in September, largely NS BlackStar Blackstar Investor GBPGBR 33.76 28.79 -0.13 NS currency markets at a time of rising 2,000 Continued from first page Naguib Kheraj to the new position U.S. economy and as euro-zone in- due to a surge in imports of com- Investors ORD PLC global tensions over exchange rates. “strands” of outreach. ISAF has been of chief executive officer of Lazard dustrial production rebounded modities, especially oil. NS Asset GE Asset GBPGBR 13.42 27.37 8.94 16.58 The reserves, already by far the facilitating the talks “for a few International, effective beginning faster than expected. Also, euro-zone industrial pro- 1,500 Management InvestmentManagement Company Inc. Ordi largest such stash in the world, months, sporadically, with a few next year. Germany’s DAX index reached a duction increased by 1% in August. jumped by $194 billion in the third weeks to a month between each con- Mr. Kheraj, who will be based in 2010 high, while gold soared to an- The outcome would have been 5 Hiscox Hiscox IM (Dublin) USDIRL 18.63 23.15 32.93 7.63 1,000 quarter, central-bank data issued tact,” an official said. London, will take a leadership role other record, oil prices gained and stronger if not for a 13.6% drop in Far-Eastern Financial Wednesday show, marking their big- After the Serena talks were re- in advising large corporations, fi- the euro rose against the dollar. Irish production. NS eQ Emerging AS Trigon Funds EUREST 18.51 22.85 57.94 NS gest-ever quarterly gain. Economists 500 ported, Western officials confirmed nancial institutions and sovereign Positive news about third-quar- Late in New York, the euro was Financials said the increase in reserves was that the Taliban officials participat- funds in Europe, the Middle East ter earnings at U.S. companies rein- at 1.3959, up from $1.3916 late Tues- 4 Pioneer Pioneer Pekao TFI PLNPOL 16.51 22.64 14.13 NS driven by both a rebound in China’s 0 ing were members of the Quetta and Africa, the investment bank forced the positive tone in the mar- day. The euro also rose against Ja- Aktywnej AlokacjiS.A trade surplus and the recent fall in Shura, the group’s central decision- said. He also will be deputy chair- ket. Intel made positive comments pan’s currency, trading at 114.13 yen 2007 ’08 ’09 ’10 NS Trigon AS Trigon Funds EUREST 17.73 20.97 NS NS the U.S. dollar, which increases the making body. But it was unclear if man of the bank. about its performance in the current from 113.91 yen, while the dollar was Emerging Financials C value of China’s nondollar reserve Source: People's Bank of China they had the sanction of Mr. Omar to Mr. Kheraj was CEO of JPMorgan quarter on Tuesday, and J.P. Mor- lower, at 81.78 yen from 81.85 yen. 4 Terra Terra Forvaltning NOKNOR 13.00 19.60 22.13 -1.02

holdings in dollar terms. Agence France-Presse/Getty Images participate, and it wasn’t known Cazenove, an investment bank that gan Chase reported a strong quar- The U.K. pound was at $1.5890 from

Imaginechina via Associated Press Utbytte AS China adds to its reserves when- Timothy Geithner, in an Oct. 1 photo, whether they would be able to per- began as a joint venture between terly result on Wednesday. $1.5800 and the dollar was at 4 DnB NOR DnB NOR NOKNOR 18.81 16.26 22.97 0.19 ever the central bank buys foreign A clerk counts dollar notes at a bank in Huaibei city, China, last month. again spoke about the yuan. Tuesday. suade large parts of the Taliban J.P. Morgan Chase & Co. and Brit- The Stoxx Europe 600 index 0.9605 Swiss francs from 0.9569. Finans Kapitalforvaltning AS currency and sells its own currency movement to adhere to any deal. ain’s Cazenove Absolute Equity added 1.4% to 266.25. The U.K.’s In Asia, the Japanese market in the market. That makes the its exporters an unfair advantage. said Tom Orlik, an analyst at Stone a report Tuesday, using the official Military officials in Washington Ltd. He left after J.P. Morgan ac- FTSE 100 closed up 1.5% at 5747.35, benefited from a surprise increase 3 NEF Nord Est Asset EURLUX 10.87 15.27 11.78 NS buildup of reserves one of the main Other countries have also com- & McCarthy Research Associates in name for China’s currency. have cautioned in recent days not to quired full ownership of that busi- Germany’s DAX added 2.1% to in orders for machinery, while the Immobiliare R Management public indicators of the govern- expect dramatic results from recent ness nearly a year ago. 6434.52 and France’s CAC-40 closed NOTE: Changes in currency rates will affect performance and rankings. Source: Morningstar, Ltd plained that China’s tightly con- Beijing. The latest data contain signs Chinese market was hurt by the KEY: ** 2YR and 5YR performance is annualized 1 Oliver’s Yard, 55-71 City Road ment’s policy of limiting the moves trolled exchange rate puts more of For its part, China fears eco- that such inflows may have picked talks. “What you are seeing here is a Mr. Kheraj also has previously up 2.1% at 3828.34. September trade data. NA-not available due to incomplete data; London EC1Y 1HQ United Kingdom NS-fund not in existence for entire period www.morningstar.co.uk; Email: [email protected] in its yuan currency. The latest jump the burden of adjustment to a nomic instability from currency up in the past couple of months. The continuation of a process,” said a been a director and a member of the The earnings news, combined Gold futures resumed their climb Phone: +44 (0)203 107 0038; Fax: +44 (0)203 107 0001 in reserves—which follows China’s weaker dollar on their currencies swings, and officials have repeatedly $194 billion quarterly increase in re- military official. executive committee at Barclays with a jump in Chinese demand for on the Comex division of the New pledge of increased exchange-rate and exporters, letting Chinese man- said it will make only “gradual” serves is sizable enough that it can’t Confirmation that the U.S. has PLC, where he held a number of se- commodities, helped U.S. stocks to York Mercantile Exchange. Gold for flexibility in June—shows that there ufacturers off easy. changes in the exchange rate. In all be easily accounted for, meaning helped facilitate Taliban participa- nior positions over a decade. achieve a fourth straight day of October delivery jumped $23.80, or In major market action: Natu- quarter silver production. is still market pressure for the yuan Japan has stressed that its re- part that is to ensure local compa- that other capital inflows could well tion will likely be received positively Mr. Kheraj “has a wealth of rela- gains. The Dow Jones Industrial Av- 1.8%, to $1,369.50 an ounce. Light, ral-resources shares gained after the Petrofac rose 4.2% after an up- to rise and that the central bank is cent intervention in the foreign-ex- nies can adjust, and in part it is to have contributed. in Pakistan, where officials have tionships, and brings a unique blend erage added 75.68 points, or 0.7%, to sweet crude for November rose 1.6% Chinese trade figures reinforced ex- grade to “overweight” from “equal- still resisting that pressure, econo- change market is different from deter waves of speculative capital Much of the increase came from called on Washington to play a more of experience in advising corporates 11096.08. to $83.01 a barrel on the New York pectatios for robust Chinese de- weight” at Morgan Stanley, which mists said. countries that do not allow their coming into the country to bet on a improved export earnings: China’s open role in reconciliation talks. and financial institutions, and a U.S. Treasury debt fell broadly, Mercantile Exchange. mand. In London, Vedanta Re- said the company’s order backlog “The huge increase last quarter currencies to fluctuate freely, such stronger currency. trade surplus for the three months “America is in the talks, but has not track record of success in business- with the yield on the benchmark 10- On Thursday, market partici- sources climbed 5.9%, Anglo looked set to accelerate. will make it hard for China to argue as China, which sets a daily refer- Those worries are shared by to September totaled $65.64 billion, revealed itself,” a senior Pakistani leadership roles in the financial ser- year note rising to 2.431%. The fall pants will watch for reports on ini- American jumped 5.4% and Xstrata While banks posted broad gains, that its policy interventions are not ence rate for the yuan. many other governments, especially its highest quarterly surplus since official said Tuesday. “The U.S. must vices industry,” said Kenneth M. Ja- in prices came as a $21 billion auc- tial claims for U.S. unemployment added 4.4%. Standard Chartered fell 1.7% after a major driver of global imbal- Japanese Prime Minister Naoto in Asia, which has attracted inves- the onset of the financial crisis in reveal its face, or it [the war] will cobs, the investment bank’s chair- tion of Treasurys generated the low- benefits, producer prices and the Fresnillo rose 3.3% after the saying it will raise around £3.26 bil- ances,” said Mark Williams of Capi- Kan on Wednesday said, “If a coun- tors seeking better returns amid un- the fourth quarter of 2008, data get worse. There has to be U.S. own- man and CEO . est yield since January 2009, at balance of trade. firm reported an increase in third- lion ($5.15 billion) in a rights issue. tal Economics in London. try keeps its own exchange rate arti- certain economic prospects and low also issued Wednesday show. The ership of the reconciliation talks.” International tensions over ex- ficially low, this is not in keeping interest rates in much of the devel- trade surplus did, however, fall to a The Pakistani official said Islama- change rates were at the forefront with the G-20 agreement.” oped world. Such inflows have ag- five-month low of $16.88 billion dur- bad doesn’t need to run the talks but Advertisement [ INTERNATIONAL INVESTMENT FUNDS www.wsj.com/funddata ] Advertisement of last weekend’s meetings of the Japan took the foreign-exchange gravated the upward pressure on ing the single month of September, does need to show it is giving sup- International Monetary Fund in markets by surprise on Sept. 15 with currencies, and many countries have as commodity imports staged an un- port. Pakistan has repeatedly pushed NAV —%RETURN— NAV —%RETURN— NAV —%RETURN— Washington, and are expected to a massive intervention to push the been looking for ways to fight back. expected rebound. Oil imports, for to be given a bigger role in reconcili- FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR feature prominently at next month’s yen lower after it neared 15-year Earlier this week, Thailand removed instance, hit a monthly record in ation talks and has asked the U.S. to Emg Mkts Debt B GL BD LUX 10/12 USD 17.18 14.9 15.0 28.6 Gl Conservative A2 US BA LUX 10/12 USD 17.70 4.5 5.8 10.6 Japan Blend A JP EQ LUX 10/12 JPY 5486.00 -8.9 -6.3 1.6 summit of the Group of 20 major highs against the dollar. a tax break on foreign investment in volume terms. push the Afghan government to in- Emg Mkts Debt B2 GL BD LUX 10/12 USD 22.28 15.1 15.0 28.7 Gl Conservative B US BA LUX 10/12 USD 15.29 3.7 4.7 9.5 Japan Growth A JP EQ LUX 10/12 JPY 5178.00 -11.8 -10.2 -3.0 Emg Mkts Debt I GL BD LUX 10/12 USD 17.18 16.1 16.7 30.5 Gl Conservative B2 US BA LUX 10/12 USD 16.68 3.7 4.6 9.5 Japan Growth I JP EQ LUX 10/12 JPY 5362.00 -11.3 -9.5 -2.2 economies in Seoul. The prospect of On Tuesday, U.S. Treasury Secre- its government bonds in hopes of Economists think swings in cur- volveitmore. Emg Mkts Growth A GL EQ LUX 10/12 USD 38.05 9.8 16.8 34.6 Gl Conservative I US BA LUX 10/12 USD 15.39 5.1 6.5 11.5 Japan Strat Value A JP EQ LUX 10/12 JPY 5810.00 -5.1 -1.5 6.7 looser U.S. monetary policy has re- tary Timothy Geithner said the U.S. stemming the baht’s rise. rency and financial markets in the Mr. Karzai has demanded that the Data as shown is for information purposes only. No offer is being made by Emg Mkts Growth B GL EQ LUX 10/12 USD 32.00 9.0 15.6 33.3 Gl Eq Blend A GL EQ LUX 10/12 USD 11.65 -0.1 1.9 12.7 Japan Strat Value I JP EQ LUX 10/12 JPY 6002.00 -4.5 -0.7 7.5 Morningstar, Ltd. or this publication. Funds shown aren’t registered with the Emg Mkts Growth I GL EQ LUX 10/12 USD 42.45 10.5 17.7 35.7 Gl Eq Blend B GL EQ LUX 10/12 USD 10.85 -0.9 0.9 11.5 Real Estate Sec. A OT EQ LUX 10/12 USD 16.50 15.0 17.9 16.7 cently helped to push the dollar wants to make sure the yuan appre- Chinese regulators have also re- third quarter may have added any- Taliban recognize the Afghan consti- U.S. Securities and Exchange Commission and aren’t available for sale to United Eur Income A EU BD LUX 10/12 EUR 7.04 11.3 12.5 19.7 Gl Eq Blend I GL EQ LUX 10/12 USD 12.37 0.6 2.8 13.6 Real Estate Sec. B OT EQ LUX 10/12 USD 14.96 14.0 16.7 15.5 States citizens and/or residents except as noted. Prices are in local currencies. Eur Income A2 EU BD LUX 10/12 EUR 14.36 11.6 12.5 19.7 Gl Growth A GL EQ LUX 10/12 USD 42.46 1.3 4.6 12.1 Real Estate Sec. I OT EQ LUX 10/12 USD 17.84 15.7 18.9 17.6 down sharply against a range of cur- ciates “at a gradual but still signifi- peatedly signaled concern over in- where from $60 billion to $100 bil- tution and lay down arms. But some All performance figures are calculated using the most recent prices available. Eur Income B EU BD LUX 10/12 EUR 7.04 10.7 11.8 18.9 Gl Growth B GL EQ LUX 10/12 USD 35.17 0.5 3.5 11.0 Short Mat Dollar A US BD LUX 10/12 USD 7.41 4.0 6.4 3.9 rencies, from the euro and yen to cant rate.” A “substantially under- flows of so-called hot money—or lion to the value of China’s reserves, of his aides and other officials have NAV —%RETURN— Eur Income B2 EU BD LUX 10/12 EUR 13.28 10.9 11.6 18.9 Gl Growth I GL EQ LUX 10/12 USD 47.44 2.0 5.4 13.0 Short Mat Dollar A2 US BD LUX 10/12 USD 10.20 4.2 6.5 3.9 the Australian dollar and Brazilian valued” yuan is unfair to other speculative capital. “Because of which are primarily held in U.S. gov- suggested that the Afghan govern- FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR Eur Income I EU BD LUX 10/12 EUR 7.04 11.7 13.0 20.3 Gl High Yield A US BD LUX 10/12 USD 4.68 14.6 18.9 28.9 Short Mat Dollar B US BD LUX 10/12 USD 7.41 3.7 6.0 3.5 Eur Strat Value A EU EQ LUX 10/12 EUR 8.71 2.1 4.3 8.1 Gl High Yield A2 US BD LUX 10/12 USD 10.64 14.9 19.0 28.8 Short Mat Dollar B2 US BD LUX 10/12 USD 10.11 3.8 6.0 3.4 real, with the notable exception of emerging economies that are letting market conditions including the ex- ernment and other bonds. That is a ment would be willing to abandon Eur Strat Value I EU EQ LUX 10/12 EUR 8.96 2.5 4.9 8.9 Gl High Yield B US BD LUX 10/12 USD 4.68 13.7 17.6 27.3 Short Mat Dollar I US BD LUX 10/12 USD 7.41 4.5 7.0 4.5 Eur Value A EU EQ LUX 10/12 EUR 9.35 1.6 4.9 10.4 Gl High Yield B2 US BD LUX 10/12 USD 16.97 14.0 17.8 27.6 US Thematic Portfolio A EURUS H EQ LUX 10/12 EUR 16.48 NS NS NS the Chinese yuan. their currencies move, Mr. Geithner pectation of renminbi appreciation reversal from the first half of the such “red lines” in an attempt to Eur Value B EU EQ LUX 10/12 EUR 8.53 0.8 3.8 9.2 Gl High Yield I US BD LUX 10/12 USD 4.68 15.0 19.5 29.7 US Thematic Portfolio B EUR HUS EQ LUX 10/12 EUR 16.44 NS NS NS Eur Value I EU EQ LUX 10/12 EUR 10.86 2.3 5.6 11.2 Gl Thematic Res A GL EQ LUX 10/12 USD 15.90 7.9 10.6 31.5 The yuan has risen only about said in a televised interview. and a positive interest-rate gap with year, when the rising U.S. dollar was kick-start substantive negotiations. US Thematic Portfolio C EUR HUS EQ LUX 10/12 EUR 16.46 NS NS NS EuroZone Strat Val AX EU EQ LUX 10/12 EUR 7.57 7.7 11.2 12.6 Gl Thematic Res B GL EQ LUX 10/12 USD 13.80 7.1 9.5 30.1 US Thematic Portfolio I EUR HUS EQ LUX 10/12 EUR 16.51 NS NS NS 2.3% against the dollar since June, The latest reserve figure “cer- foreign currencies, this situation of a drag on the reported value of the In return, the Taliban would be ex- EuroZone Strat Val BX EU EQ LUX 10/12 EUR 6.75 6.8 9.9 11.5 Gl Thematic Res I GL EQ LUX 10/12 USD 17.84 8.6 11.5 32.5 US Thematic Research A US EQ LUX 10/12 USD 9.18 7.6 11.1 17.1 n ALLIANCE BERNSTEIN EuroZone Strat Val IX EU EQ LUX 10/12 EUR 8.30 8.2 12.0 13.5 Gl Value A GL EQ LUX 10/12 USD 11.02 -1.1 -0.1 13.5 most of that in the past month. tainly puts a target around the neck net cross-border fund inflows is un- reserves. pected to abandon demands for the US Thematic Research B US EQ LUX 10/12 USD 8.39 6.9 10.1 16.0 www.alliancebernstein.com/investments Tel. +800 2263 8637 Gl Balanced (Euro) A EU BA LUX 10/12 USD 16.64 NS NS NS Gl Value B GL EQ LUX 10/12 USD 10.05 -1.9 -1.1 12.4 US Thematic Research I US EQ LUX 10/12 USD 9.94 8.3 11.9 18.1 Many U.S. politicians say China’s of China’s exchange-rate policy in likely to change,” the State Adminis- —William Sposato in Tokyo immediate departure of all foreign Am Blend Portfolio A US EQ LUX 10/12 USD 10.47 1.0 2.9 12.8 Gl Balanced (Euro) B EU BA LUX 10/12 USD 16.08 NS NS NS Gl Value I GL EQ LUX 10/12 USD 11.80 -0.4 0.8 14.4 Am Blend Portfolio I US EQ LUX 10/12 USD 12.39 1.4 3.6 13.6 Gl Balanced (Euro) C EU BA LUX 10/12 USD 16.47 NS NS NS India Growth A EA EQ LUX 10/12 USD 157.07 23.8 30.2 NS currency is still undervalued, giving the newly declared currency wars,” tration of Foreign Exchange said in contributed to this article. forces as a precondition for talks, Am Growth A US EQ LUX 10/12 USD 30.68 -1.8 2.2 18.3 Gl Balanced (Euro) I EU BA LUX 10/12 USD 17.04 NS NS NS India Growth AX EA EQ LUX 10/12 USD 137.60 24.0 30.6 49.8 Afghan officials said. Am Growth B US EQ LUX 10/12 USD 25.60 -2.5 1.1 17.2 Gl Balanced A US BA LUX 10/12 USD 17.11 3.8 5.4 13.4 India Growth B EA EQ LUX 10/12 USD 163.26 22.8 28.9 NS Am Growth I US EQ LUX 10/12 USD 34.22 -1.2 3.0 19.3 Gl Balanced B US BA LUX 10/12 USD 16.14 3.0 4.3 12.2 India Growth BX EA EQ LUX 10/12 USD 116.71 23.1 29.3 48.4 The U.S. government has long in- Am Income A US BD LUX 10/12 USD 9.10 12.6 14.1 20.7 Gl Balanced I US BA LUX 10/12 USD 17.84 4.4 6.1 14.2 India Growth I EA EQ LUX 10/12 USD 143.16 24.5 31.2 50.5 sisted that insurgent acceptance of Am Income A2 US BD LUX 10/12 USD 21.48 12.8 14.2 20.6 Gl Bond A US BD LUX 10/12 USD 9.78 9.0 9.8 12.7 Int'l Health Care A OT EQ LUX 10/12 USD 133.99 -2.5 5.6 8.8 Am Income B US BD LUX 10/12 USD 9.10 12.0 13.3 19.7 Gl Bond A2 US BD LUX 10/12 USD 17.48 9.2 9.7 12.7 Int'l Health Care B OT EQ LUX 10/12 USD 112.14 -3.3 4.5 7.7 n BANC INTERNACIONAL D'ANDORRA. BANCA MORA. the Afghan constitution, which en- Am Income B2 US BD LUX 10/12 USD 18.41 12.2 13.4 19.8 Gl Bond B US BD LUX 10/12 USD 9.78 8.3 8.7 11.6 Int'l Health Care I OT EQ LUX 10/12 USD 147.31 -1.9 6.4 9.6 shrines democratic freedoms and Am Income I US BD LUX 10/12 USD 9.10 13.1 14.8 21.4 Gl Bond B2 US BD LUX 10/12 USD 15.19 8.3 8.7 11.6 Int'l Technology A OT EQ LUX 10/12 USD 118.39 7.3 15.6 23.1 Avgd. Meritxell 96, Andorra la Vella. Andorra. Ph. +376.884884 www.bibm.ad Germany warns of trade war over yuan Emg Mkts Debt A GL BD LUX 10/12 USD 17.18 15.7 16.1 29.9 Gl Bond I US BD LUX 10/12 USD 9.78 9.5 10.4 13.3 Int'l Technology B OT EQ LUX 10/12 USD 101.79 6.4 14.5 21.9 Andfs. Anglaterra UK EQ AND 10/12 GBP 8.41 2.0 6.2 20.2 women’s rights, is indispensable for Emg Mkts Debt A2 GL BD LUX 10/12 USD 23.31 15.9 16.1 30.0 Gl Conservative A US BA LUX 10/12 USD 15.30 4.5 5.7 10.6 Int'l Technology I OT EQ LUX 10/12 USD 133.57 7.9 16.5 24.1 Andfs. Borsa Global GL EQ AND 10/12 EUR 6.23 -4.2 -1.6 4.7 any reconciliation. Other interna- BY ANDREA THOMAS Axel Weber, and shows the growing capital goods to China, as well as yuan, the European officials said. tional officials and Afghan policy concern in Europe’s biggest econ- growing numbers of luxury cars to Mr. Wen later scolded the Euro- makers say that democratic mecha- Advertisement [ ALTERNATIVE INVESTMENT FUNDS www.wsj.com/funddata ] Advertisement BERLIN—Germany urged China omy that U.S.-China tensions could newly affluent Chinese. peans for pressing China on the is- nisms already exist for rewriting the to loosen controls on the yuan’s ex- threaten the global trade flows on Washington has been pushing sue. constitution if necessary. 12-month and 2-year returns may be calculated over 11- and 23-month periods NAV —%RETURN— NAV —%RETURN— change rate, warning that a trade which Germany depends. China to let the yuan strengthen, Some European officials remain The senior NATO official speaking pending receipt and publication of the last month end price. FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR NAV —%RETURN— war could result from countries Germany’s economic recovery but China has said that any move- wary of criticizing China publicly in Brussels suggested Mr. Karzai Global Absolute USD OT OT GGY 03/31 USD 2.05 2.8 15.2 0.3 n INDICES FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR HSBC Uni-folio competing to boost their exports by has been driven in large part by ex- ment will need to be gradual. Some over the yuan. EU trade commis- wasn’t softening his position. “Presi- Asian AdbantEdge EUR OT OT JEY 09/17 EUR 98.05 -1.2 -0.4 NS n HSBC ALTERNATIVE STRATEGY FUND n ALEXANDRA INVESTMENT MANAGEMENT Asian AdvantEdge OT OT JEY 09/17 USD 180.27 -1.3 -0.3 NS NAV —————— %RETURN —————— keeping their currencies weak. ports to China and other fast-devel- U.S. officials believe Europe has sioner Karel de Gucht said last week dent Karzai’s red lines are quite Special Opp EUR OT OT CYM 08/31 EUR 89.13 -1.8 5.0 NS FUND NAME GF DATE CR NAV 1-WK 1-MO 1-Q 1-YR 2-YR Alexandra Convertible Bond FundOT I, OT Ltd. VGB (Class 08/31 A) USD 2174.86 28.6 51.1 47.6 Emerg AdvantEdge OT OT JEY 09/17 USD 167.03 -0.2 0.8 NS Special Opp Inst EUR OT OT CYM 08/31 EUR 84.59 -1.3 5.7 NS German Economy Minister oping countries, and German policy been hiding behind the U.S. on the that he didn’t believe pressure from clear,” the official said. “If agree- Emerg AdvantEdge EUR OT OT JEY 09/17 EUR 92.73 -0.5 0.6 NS n D'AURIOL FUNDS WWW.DAURIOL.BIZ Special Opp Inst USD OT OT CYM 08/31 USD 96.21 -1.2 5.9 NS n Europ AdvantEdge EUR OT OT JEY 09/17 EUR 129.64 -2.3 -1.9 NS ARIX ABSOLUTE RETURN INVESTABLE INDEX Rainer Brüderle said China needs to makers view rising international issue to avoid diplomatic tensions outside would cause the Chinese to ment can be reached along those 2 FUNDS OF FUNDS OF HEDGE FUNDS Special Opp USD OT OT CYM 08/31 USD 93.78 -1.7 5.2 NS Europ AdvantEdge USD OT OT JEY 09/17 USD 137.47 -2.5 -2.0 NS Feri Institutional Advisors, www.feri.de D'Auriol Alt Non-Lev A EU OT CYM 08/31 EUR 99.53 -0.9 -0.8 -6.1 ARIX Composite Gross USD OT OT GBR 09/30.00 USD1425.72 7.4 -12.7 -6.5 take action to defuse the risk of a tensions over exchange rates as po- with Beijing. act; that pressure would come inter- lines, then that would be a positive n HSBC Portfolio Selection Fund Real AdvantEdge EUR OT OT JEY 09/17 EUR 104.55 -3.4 -2.2 NS D'Auriol Opp F3 EUR EU MM CYM 07/30 EUR 939.75 -4.9 -4.8 -14.4 damaging trade dispute with the tentially destabilizing. But German However, European Union offi- nally from worries about inflation, development for Afghanistan.” GH Fund AP OT OT GGY 04/30 EUR 120.82 3.5 -13.4 -3.8 Real AdvantEdge USD OT OT JEY 09/17 USD 105.07 -3.0 -1.8 NS U.S. and European comments on China’s cials have become more critical of he said. The Serena Hotel meetings—a fol- n HERMITAGE CAPITAL MANAGEMENT LTD. GH Fund CHF Hdg OT OT GGY 08/31 CHF 109.96 0.1 1.9 NS Trading Adv JPY OT OT GGY 07/30 JPY 9414.60 2.1 -1.0 NS NAV —%RETURN— Tel: +7501 258 3160 www.hermitagefund.com GH Fund EUR Hdg (Non-V) OT OT GGY 04/30 EUR 109.43 2.9 -15.9 -5.9 Trading AdvantEdge OT OT GGY 09/17 USD 143.91 2.6 -2.5 NS FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR “We have to take care that the exchange rate generally remain China lately. Last week, Luxem- Business pressure on European low-up to a session held in Abu The Hermitage Fund GL EQ JEY 03/12 USD 963.12 4.5 105.6 -23.2 GH Fund GBP Hdg OT OT GGY 08/31 GBP 131.72 0.6 2.6 NS Trading AdvantEdge EUR OT OT GGY 09/17 EUR 130.31 2.3 -2.9 NS GH Fund Inst USD OT OT GGY 07/30 USD 111.21 0.9 3.0 NS Trading AdvantEdge GBP OT OT GGY 09/17 GBP 138.43 2.8 -2.2 NS currency war doesn’t become a more muted than U.S. officials’ criti- bourg’s Prime Minister Jean-Claude governments over the currency has Dhabi in June—haven’t formally in- n HORSEMAN CAPITAL MANAGEMENT LTD. GH FUND S EUR OT OT CYM 08/31 EUR 128.58 1.3 3.7 NS n OTHER FUNDS trade war,” Mr. Brüderle told Ger- cisms of Beijing. Juncker said after meeting Chinese largely been muted until now. Exec- volved the 68-member peace council T: +44(0)20 7838 7580, F: +44(0) 20 7838 7590, www.horsemancapital.com GH FUND S GBP OT OT GGY 08/31 GBP 133.52 1.6 3.9 NS For information about these funds, please contact us on Tel: +44 (0) 207 842 9694/9633 Horseman EmMkt Opp EUR GL EQ USA 01/31 EUR 187.60 -23.2 -21.7 -7.7 GH Fund S USD OT OT CYM 08/31 USD 150.77 1.3 3.6 NS man newspaper Handelsblatt. Many policy makers and econo- Premier Wen Jiabao that “China’s utives say that is because many of that Mr. Karzai appointed last Medinvest Plc Dublin OT OT IRL 06/30 USD 1481.20 NS 1.3 -4.4 Horseman EmMkt Opp USD GL EQ USA 01/31 USD 194.78 -24.5 -22.7 -9.1 GH Fund USD OT OT GGY 08/31 USD 272.27 0.4 2.2 NS “China bears a lot of responsibility mists on both sides of the Atlantic real effective exchange rate remains Europe’s biggest companies have month to try to open official talks Horseman EurSelLtd EUR EU EQ GBR 09/30 EUR 208.90 7.1 10.2 -0.7 Hedge Investments OT OT JEY 08/31 USD 139.81 NS 2.9 NS n WINTON CAPITAL MANAGEMENT LTD for ensuring that it doesn’t come to believe China keeps its currency ar- undervalued.” European Central large investments in China. Not only with Taliban leadership headed by Horseman EurSelLtd USD EU EQ GBR 09/30 USD 221.07 9.5 12.7 0.5 Leverage GH USD OT OT GGY 08/31 USD 117.42 -0.9 2.4 NS Tel: +44 (0)20 7610 5350 Fax: +44 (0)20 7610 5301 Horseman Glbl Ltd EUR GL EQ CYM 09/30 USD 398.75 7.6 4.9 -4.1 JEY MultiAdv Arb CHF Hdg OT OT 08/31 CHF 95.57 1.1 4.7 -5.7 n Winton Evolution EUR Cls H GL OT CYM 08/31 EUR 1036.88 11.2 10.4 NS an escalation,” he said. The ministry tificially weak to help its exporters. Bank President Jean-Claude Trichet do exports from these factories ben- Mr. Omar. The Taliban have rejected Horseman Glbl Ltd USD GL EQ CYM 09/30 USD 398.75 7.6 4.9 -4.1 JEY MERIDEN GROUP MultiAdv Arb EUR Hdg OT OT 08/31 EUR 104.43 1.4 5.4 -5.2 Winton Evolution GBP Cls G GL OT CYM 08/31 GBP 1043.04 11.5 10.7 NS JEY Tel: + 376 741 175 Fax: + 376 741 183 Email: [email protected] confirmed his comments. But the issue is politically less and EU economics commissioner efit from a weak yuan, but compa- that council, describing Mr. Karzai n MultiAdv Arb GBP Hdg OT OT 08/31 GBP 112.74 1.5 5.6 -5.6 Winton Evolution USD Cls F GL OT CYM 08/31 USD 1314.75 11.2 10.6 7.2 HSBC ALTERNATIVE INVESTMENTS LIMITED MultiAdv Arb S EUR OT OT CYM 08/31 EUR 112.67 2.5 6.1 NS Antanta Combined Fund EE EQ AND 10/08 USD 402.74 9.2 18.6 11.8 Winton Futures EUR Cls C GL OT VGB 08/31 EUR 214.32 9.8 10.6 8.0 Mr. Brüderle’s warning follows prominent in Europe than in the Olli Rehn, who also attended the nies also don’t wish to upset the as an American stooge and saying T +44 20 7860 3074 F + 44 20 7860 3174 www.hail.hsbc.com MultiAdv Arb S GBP OT OT CYM 08/31 GBP 118.10 2.4 7.0 -4.3 Antanta MidCap Fund EE EQ AND 10/08 USD 808.05 13.8 41.5 15.7 Winton Futures GBP Cls D GL OT VGB 08/31 GBP 231.82 9.9 10.9 8.5 HSBC Absolute Companies MultiAdv Arb S USD OT OT CYM 08/31 USD 128.69 2.4 6.0 NS Meriden Opps Fund GL OT AND 09/29 EUR 44.67 -25.5 -34.6 -33.9 other recent criticism of China’s ex- U.S. In Germany, China’s rapid in- meeting, echoed the point. Chinese authorities. the insurgency’s military triumph Winton Futures JPY Cls E GL OT VGB 09/30 JPY 15433.19 11.1 11.8 7.3 Global Absolute OT OT GGY 03/31 GBP 1.11 2.9 16.5 0.6 MultiAdv Arb USD OT OT JEY 08/31 USD 196.68 1.3 5.4 -3.7 Meriden Protective Div GL EQ AND 09/01 EUR 79.14 NS NS NS change-rate policy by German policy dustrialization and export prowess The three had urged Mr. Wen to —Stephen Fidler in Brussels over U.S.-led troops is within sight. Global Absolute EUR OT OT GGY 05/13 EUR 1.56 2.8 14.2 NS Winton Futures USD Cls B GL OT VGB 08/31 USD 760.93 9.8 10.8 7.9 makers including Chancellor Angela are seen as a boon, since German in- allow an “orderly, significant and and William Sposato in Tokyo —Maria Abi-Habib in Kabul Merkel and Bundesbank President dustry supplies large amounts of broad-based appreciation” of the contributed to this article. contributed to this article. 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