28 FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 THE WALL STREET JOURNAL. HEARD ON THE STREET

Financial Analysis and Commentary more at WSJ.com/heard

VOL. XXVI NO. 250 FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 Uninjectable Time’s a wastin’ for U.K. Œ2.70 U.K.’s Barclays bind Barclays’s daily share Œ2.90 Is Mexico City the world’s price in London So far, the U.K. govern- The lesson of the credit As if Barclays sharehold- vestment Authority, which tar’s stake would increase ment’s latest bailout plan crunch so far is that, when

- France greatest food town? 800 pence - Slovenia ers didn’t have enough to lost billions on Citigroup. from 32% to 41%. The gov- has had exactly the opposite offered promises rather WEEKEND JOURNAL | PAGES W8-W9 Chinese growth plunges, worry about already. Like Singapore’s Temasek ernment would get 20% effect of what was intended. than details, investors as- Œ3.20 Shares in the U.K. bank with its Merrill Lynch invest- rather than 37%. Other 600 Instead of rescuing the sume the worst. The lack of Sk 100/Œ3.32 have slumped nearly 70% in ment, Qatar demanded an shareholders go from 68% banks and restoring confi- detail on the asset-protec- - Finland Ten fundamental questions just eight trading days anti-dilution clause—if the to 31%. 400 dence in the U.K., the moves tion scheme—including, cru- Dkr 22 amid fears it may need to bank were to raise more capi- That makes it harder for sent bank shares tumbling cially, any sense of the - Slovakia for the U.S. car industry Œ3 with global aftershocks this week, while sterling is losses the taxpayer might access state capital. tal at a lower price before the U.K. to inject capital 200 NEWS IN DEPTH | PAGES 14-15 June 30, 2009, its shares at its lowest level against bear—meant the positive el-

But thanks to fine print into Barclays—only to hand - Denmark in the £4 billion ($5.5 bil- would convert into Barclays upside to a foreign investor. the dollar in 27 years. There ements of the package were - Portugal Slowing demand hits 0 is still time for Prime Minis- overshadowed by the Royal lion) of mandatory convert- stock at the new lower price. Of course, Qatar itself could 2007 '08 '09 Kc 110 ible notes issued to Qatar At Thursday’s 59 pence put in the capital, thereby ter Gordon Brown to reverse Bank of Scotland’s profit Zl 10.50 region’s exporters; Source: Thomson Reuters Datastream this self-inflicted crisis of warning issued Monday last year, injecting capital a share, Qatar would re- taking control of the bank, confidence, but he is run- morning. - Poland would leave both sharehold- ceive nearly three times the if allowed. Or perhaps the Korea, Japan wilt ning out of time—and It is too late for - Czech Republic ers and the government shares originally agreed Qataris could be persuaded tors are skeptical, after this Nkr 27 What’s News— options. Mr. Brown to correct the heavily diluted. and its percentage stake waive their rights. week’s profit warning by By Andrew Batson Mr. Brown made two big first mistake. But he can 7 7

HRK 22 Business&Finance World-Wide

would increase. How much RBS. Besides this crisis has - Norway Qatar saw how other sov- Barclays argues this is mistakes. First, he opted for still do something about the ereign-wealth funds got depends on the new price academic, saying its core shown often enough how Fiat’s industrial debt soared The ECB is likely to move cau- BEIJING—Three of Asia’s power-

an insurance scheme rather second. The Treasury says Œ2.90 - Croatia to $7.67 billion at the end of tiously in lowering its key rate burned investing in western and the sum to be raised. Tier 1 capital ratio at the quickly the seemingly un- than creating a fund to ab- it may take until the end of house economies—China, Japan banks as subsequent capital But if Barclays raised £3 bil- end of 2008 is likely to be thinkable can become only last year and sales tumbled, un- closer to zero, a top policy maker and South Korea—are stalling as de- sorb bad bank assets, which February to work out de- Œ2.90 raisings diluted them—most lion at 60 pence, J.P. Mor- 6.5%—enough to satisfy the too real. derscoring the tough condi- there suggested, because it mand for their goods from the U.S. Press Associated

might have drawn a line un- tails of the asset-protection - Netherlands doesn’t see deflation threaten- Japanese products at a supermarket in Shanghai notably the Abu Dhabi In- gan Cazenove estimates Qa- U.K. regulators. But inves- —Simon Nixon der the crisis once and for scheme. That is far too tions the Italian auto maker and Europe wilts, and there are few - Belgium Dh 24 faces as it tries to take a 35% ing the euro zone and is con- signs of a hoped-for increase in Chi- Slowing growth

all. He seems to have long. The longer the uncer- Œ3 stake in Chrysler under a broad cerned about creating another nese consumption that might help China GDP South Korea GDP Japan GDP ducked the bad-bank choice tainty continues, the £1.40 strategic alliance. Page 1 credit-fueled bubble. Cutting Year-to-year change Year-to-year change Year-to-year change because he was worried greater the risk of both a - Morocco keep the global economy afloat. Destruction of trust will hurt Wall Street for years - Austria rates sharply now makes it about the impact on ster- run on the U.K. banks by de- n Bank of America CEO Ken- The financial crisis has slashed 15% 10% 3% Another reputation bites power struggles, huge losses the money-making magic. stroyed, clients lost fortunes Œ2.90 harder to raise them back to China’s growth almost in half within ling of issuing large quanti- positors and bondholders neth Lewis dismissed former 8 2 the dust. John Thain is the and increased regulation, In addition, any belief in and taxpayers stepped in to the right level later, Lorenzo a single year: gross domestic prod- Lk 370.00 ties of gilts to fund the pur- and a run on sterling by for- – United Kingdom Merrill Lynch chief John Thain, Bini Smaghi said. Page 3 10 latest banking grandee to there is a more fundamental Wall Street’s willingness to prop up the industry. chase of toxic assets. But eign investors. Mr. Brown $2 angered by Thain’s handling of uct expanded just 6.8% from a year 6 1 exit ignominiously . His threat to the industry that do the right thing has been Politicians and regulators - Luxembourg n when one considers what must spell out the scale of Merrill’s losses. Page 1 Obama began overhauling earlier in the fourth quarter of 4 0 forced sale of Merrill Lynch will take years to overcome: hammered. It is no secret will tighten the leash. But 2008, and 9% for the full year, the 5 has happened since, it is toxic assets the government n U.S. treatment of terror suspects,

L£ 4000 Russia’s central bank said it to Bank of America ended the destruction of trust. that people enter finance to even though investors and hard to argue this wasn’t a is willing to insure, the signing orders to close the Guan- government said Thursday. That 2 -1 will end the ruble’s slide, setting Estimate in a government bailout and Each new revelation pulls make money. But the indus- companies will one day re- risk worth taking. The U.K. losses it is willing to bear, tanamo detention center, review compares to annual growth of 13% 0 0 -2 - U.S. Military (Eur) a floor about 10% below current controversy over bonus pay- back the curtain on Wall try continued enriching it- gain an appetite for risk, the has ended up with the same and how it intends to pay - Lebanon military trials and ban some in- in 2007. 2000 ’05 ’08 2000 ’05 ’08 FY2000 ’05 ’08 ments. Ken Lewis, BofA’s Street’s machinery, like a 21st self as it went off a cliff. destruction of trust will stifle levels that it expects will hold for Page 8 Efforts to stimulate consump- pain for less gain. for them, including long- TL 4.25 terrogation methods.

Œ2.90 Note: Japan’s fiscal year ends March 31 of the following year chief executive, is left look- century rerun of “The Wizard Firms paid huge bonuses the Street’s profitability for at least a few months. Page 17 n A Senate committee Mr. Brown’s second mis- term cuts in public spend- approved tion in China are running up against Sources: National statistical authorities

ing increasingly vulnerable. of Oz.” Regulators and clients even as losses mounted, in- years to come. - Italy n take was to come up with a ing. And he must do it fast. - Turkey The SEC settled a complaint Geithner’s nomination as U.S. a gloomy economic climate that is But beyond the individual are no longer bamboozled by vestors saw stock prices de- —Thorold Barker with GM related to accounting Treasury secretary, clearing the making consumers more cautious,

plan rather than a solution. —Simon Nixon Œ2.90

S£ 210 missteps the auto company way for the full Senate to con- as well as a government legacy of en- hoped China’s government can help been accelerating since. In Decem- made. GM isn’t paying any pen- sider his confirmation. Page 8 couraging corporate investment support global growth by buying ber, Japan shipped 750 billion yen - Syria alties or fines. Page 17 n A precipitous withdrawal of over individual spending. more from abroad, rather than aid- ($8.39 billion) of goods to China, - Ireland (Rep.) China’s slowdown is starting to ing only its own exporters. down 36% from a year earlier— SF 4.80 n The U.S. Fed is likely to keep American troops from Iraq pummel its neighbors, who had prof- Japan’s exports to China had worse than the declines of 25% in No- Ft 590 its approach to handle the finan- could give al Qaeda a chance to held up well until recently. But ship- vember and 0.9% for October—ac- cial crisis despite internal divi- regenerate, U.S. Ambassador ited in recent years from Chinese de- mand for their machinery and com- ments started shrinking year-on- cording to data released Thursday - Switzerland Ryan Crocker said. Page 9 Fed officials likely to keep current policies - Hungary sions about some tactics. Page 28 ponents. Trading partners have year in October and the decline has Please turn to page 27

kr 27 n n Hamas called mittee, the Fed’s policy-making and one day unwinding them. The Mr. Bernanke, whose view car- omy that they will create inflation Œ2.90 The U.K. is working on an in- for reconcilia- New steps including arm, meets next Tuesday and programs—ranging from efforts to ries the day on the FOMC, opposes later. It could also show that offi- surance plan aimed at putting tion with supporters of Abbas - Greece Wednesday. The committee, which buy commercial paper to offering efforts to set limits or targets for cials won’t let the economy sink so - Sweden a lid on banks’ losses. Page 17 but insisted on pursuing resis-

Œ3 tance against Israel. The U.N. Fiat automobile an inflation target sets monetary policy, consists of emergency loans to banks and secu- how much the Fed’s balance sheet low that deflation, or a broad de- n Œ2.90 European and U.S. demand said it will raise funds for emer- Lower earnings market in Sao members of the Federal Reserve rities firms—are the province of the should grow, or how much cash it cline in prices, would set in. is wilting, stalling the power- Fiat’s fourth-quarter net profit Thain ousted Germany For information or to subscribe, visit www.services.wsje.com or call +44 (0) 207 309 7799 — Albania Spain gency repairs in the Gaza Strip. Paulo may be put on hold Board in Washington and a rotation Federal Reserve Board and the New pumps into the economy. Such lim- But officials aren’t prepared to house economies of China, Ja- fell 71% from a year earlier of five presidents from the 12 re- York Fed. its, he said in a speech last week, take such a step. Setting a target pan and South Korea. Page 1 n A senior figure in Iceland’s By Jon Hilsenrath gional Fed banks. Some regional Fed bank presi- could force the Fed to be more re- raises many questions, including: main governing party said she Œ800 million by BofA chief n Ryanair dropped In normal times, the focus of dents worry that these new pro- strained at a time when its interven- What is the appropriate inflation its bid for expects early elections this year, Federal Reserve officials are FOMC meetings is the level of the grams are causing the Fed’s balance tion is most needed. rate to target? And what is the ap- Aer Lingus, which separately as police used tear gas to break partnered with United on new likely next week to stick closely to Fed’s benchmark interest rate, the sheet and the U.S.’s money supply to In their statement following next propriate measure of inflation? up an antigovernment protest. 600 over missteps trans-Atlantic routes. Page 2 their approach for handling the fi- federal-funds rate. At the December grow too quickly, which could cause week’s meeting, Fed officials are They are also examining closely n Turkish police detained more nancial crisis—near-zero interest meeting of the FOMC, the central inflation, and are pushing for likely to acknowledge the continued the idea of purchasing Treasury se- n KBC and Fortis Banque expect By Susanne Craig suspects connected with an al- 400 And Dan Fitzpatrick rates and rapid growth in special bank said it would push the fed- stricter guidelines on how fast the deterioration in the economy since of- curities, but this also looks like it is to post losses in the fourth quar- leged plot to bring down the lending programs—despite internal funds rate to near zero. With policy programs can grow. ficials last met, and the quick slow- on the backburner for now. ter, but KBC’s shares jumped 50% Islamic-rooted government. divisions about some of their tactics. makers unable to move the target “I believe we must proceed with down in inflation. The abrupt infla- Such a policy could help push as investors chose to focus on Less than four months after be- 200 Some steps under consideration— lower to boost the weak economy, caution,” Mr. Plosser, the Philadel- tion slowdown, some officials believe, long-term interest rates lower, but the bank’s latest bailout. Page 17 n Chinese judges imposed se- ing hailed as a hero for averting the vere penalties, including death such as setting an inflation target or the focus of FOMC meetings has phia Fed president, said in a speech raises inflation-adjusted interest some Fed officials worry that inves- n European shares fell as in- potential collapse of Merrill Lynch shifted to the wide range of new earlier this month. “While the lend- rates, another impediment to growth. sentences, on defendants con- & Co., John Thain was pushed out of buying Treasury securities—are tors could see it as an effort by the vestors focused on the weak 0 victed in connection with the poi- Bank of America likely to remain on the backburner lending and asset-purchase pro- ing programs are designed to im- Several Fed officials have high- central bank to finance large govern- economy and corporate earn- 2007 ’08 Corp. by his new grams the Fed has introduced. prove the flow of credit, they are cur- lighted the potential benefits of an ment budget deficits, which could soning of dairy products. Page 11 boss, who was angered by Mr. as Fed officials examine the efficacy ings. U.S. stocks pulled back Source: the company of those ideas. An inflation target Much of the coming meeting will rently injecting enormous amounts inflation target, which could help be inflationary. They are instead fo- from early lows. Page 18 n Iran sentenced two AIDS phy- Thain’s handling could help manage expectations for be spent reviewing these programs, of liquidity into the system,” said convince investors of two things. It cused on other efforts to bring sicians to six and three years Reuters of stunning future inflation, while Treasury pur- their effectiveness and challenges Mr. Plosser, who doesn’t have a vote could show that officials won’t down other long-term rates, like n Nokia’s profit sank 69% in in prison for their alleged par- losses at Merrill. chases could help bring down longer- the Fed will face in running them at the FOMC this year. pump so much money into the econ- mortgage rates. the fourth quarter as sales fell ticipation in a U.S.-backed plot Bank of Amer- term interest rates further, but the and margins shrank. Weak de- to overthrow the government. Rising debt, falling sales ica Chairman mand is forecast. Page 4 and Chief Execu- Fed worries that either step could n Greece’s government prom- n tive Kenneth also have unintended consequences. Microsoft’s profit fell 11% as ised financial assistance to farm- (See a related story about the Euro- the software maker said it ers as thousands of tractors mean rough road for Fiat Lewis, whose pean Central Bank on page 3.) Rising debt and declining sales mean rough road for Fiat plans to cut up to 5,000 jobs, blocked highways for a third day. grip on the top The efforts by some regional Fed the latest sign of strain to com- By Stacy Meichtry banks, including Italian banks Uni- job at the third- bank presidents, most notably Continued from first page rethink” of its business, Mr. Marchio- pected to share engine and fuel-effi- Although Fiat is the stronger com- modity-style businesses. Page 5 n Caroline Kennedy abandoned credit SpA and Intesa Sanpaolo SpA, largest U.S. bank Charles Plosser, head of the Philadel- providethenecessaryliquidity,”Chief nne told the conference call. Fiat will ciency technologies with Chrysler to pany, declining car sales in Europe are her quest for New York’s vacant ROME—Fiat SPA said it is grap- the past few weeks over the possibil- by stock-market phia Fed, to get the central bank to Executive Sergio Marchionne told a focus on “cash generation and cash help it produce small cars with lower cutting into its finances. Fiat’s net Markets 4 p.m. ET senate seat due to a “personal pling with rising debt and declining ity of major, medium-term credit fa- value has been John Thain set numerical targets for how much conference call with analysts Thurs- preservation” this year, he said. emissions. Chrysler, in turn, would profit for 2008 fell 16% to Œ1.7 billion, NET PCT situation,” an aide said. Page 9 car sales, underscoring the tough fi- cilities, said several people familiar questioned as a MARKET CLOSE CHG CHG money the Fed pumps into the finan- day. “We have access and good confir- Fiat and Chrysler signed a non- sell Fiat models at its dealerships. the company said. Fiat also said it n Spanish police confiscated nancial conditions the Italian auto with the matter. Two people said the result of Merrill’s woes, dismissed cial system also are going nowhere mation of the factthat these pools will binding cooperation agreement Tues- But the two companies are under planned to cut its dividend for 2008 to DJIA 8122.80 -105.30 -1.28 dozens of suspected fake Dali maker faces as it attempts to take a group of banks is negotiating with Mr. Thain on Thursday morning in a so far. Those targets could act as a be available to us,” he added. day that involves the Italian com- pressure to demonstrate that the po- bolster capital and preserve cash. Nasdaq 1465.49 -41.58 -2.76 artworks that were to be put on 35% stake in Chrysler LLC as part of a Fiat to provide up to Œ5 billion in meeting that lasted less than 15 min- constraint on its rescue pro- In a subsequent statement, Fiat pany receiving a 35% stake in tential alliance will revive the ailing Revenue at Fiat, which also pro- DJ Stoxx 600 182.85 -1.67 -0.91 sale in the town of Estepona. broad strategic alliance. loans. A third person said the credit utes, people familiar with the mat- grams—a prospect Fed Chairman said it wasn’t seeking a capital in- Chrysler in exchange for technology U.S. auto maker. The U.S. Treasury duces farm equipment and Ferraris, FTSE 100 4052.23 -7.65 -0.19 Fiat’s industrial debt soared to facility could be closer to Œ1 billion. ter said. Ben Bernanke wants to avoid. As an crease or “external financing” to fund and access to Fiat vehicles. Under has told Chrysler it needs to come up felltoŒ13.09billioninthethree-month DAX 4219.42 -41.73 -0.98 Editorial&Opinion Œ5.94 billion ($7.67 billion) at the end Car companies require huge After flying to New York for the academic, Mr. Bernanke was a pro- mergers or acquisitions of rival auto terms of the potential deal, Fiat could with a sound restructuring plan by period ended Dec. 31, the company CAC 40 2869.62 -35.95 -1.24 of 2008 from Œ355 million at the end amounts of working capital to keep meeting in Mr. Thain’s office at Mer- ponent of inflation targets and clear makers. A Fiat spokesman declined take control of Chrysler by later in- Feb. 17 to secure billions of dollars in also announced Thursday. That was a Leaving the euro? of 2007,the company reported Thurs- their operations running, but reve- rill’s former headquarters, Mr. rules for central-bank actions, but to comment on whether it was seek- creasing its stake to 55% by paying loans that the government is offering. 17% decline from the same period in Euro $1.2968+0.0101 +0.78 day. The car maker blamed the rising nues are declining amid the global Lewis asked Mr. Thain to resign. Nymex crude $43.67 +0.12 +0.28 Dropping the common currency as Fed chairman he wants to main- ing the loans boost working capital. about $25 million, according to peo- Both auto makers say Fiat doesn’t 2007,when revenue was Œ15.81 billion. would be a big economic mis- debt on rapidly declining sales in the economic slowdown. Merrill’s former chairman and CEO tain his flexibility. Theindustry’sdeteriorationisforc- ple familiar with the matter. plan to inject any money into —Jennifer Clark in Milan Money & Investing > Page 17 take. Review & Outlook. Page 12 final three months of 2008. “We are working with parties to agreed; it was clear he had no The Federal Open Market Com- ing Fiat to undertake a “fundamental Under the agreement, Fiat is ex- Chrysler as part of the potential deal. contributed to this article. Fiat has been in talks with several Please turn to page 28 Please turn to page 27 2 FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 THE WALL STREET JOURNAL. THE WALL STREET JOURNAL. FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 27 LEADING THE NEWS FROM PAGE ONE Chinese growth plunges, with global aftershocks Aer Lingus, United to pair flights Continued from first page turn in Chinese consumption could of consumer confidence have been cially when worries about the fu- heavy financial burden it places on by the Ministry of Finance. help to rebalance a global economy falling since August. Housing sales ture encourage them to save more. households. The expansion of will take the lead on marketing tick- told a news conference in Dublin, re- Air Lines Inc. and AMR Corp.’s “We knew China-bound exports whose biggest consumer, the U.S., is have declined every month since Economists say low deposit rates health-care coverage, which is ex- ‘Open skies’ allow ets and generating revenue for the ferring to the planned joint venture American Airlines. were shrinking but we were shocked wallowing in recession. April and car sales have dropped in were part of a longer-term policy to pected to cost 850 billion yuan over operation. with United and its previous code- Aer Lingus will use an existing by the size and abruptness of the de- Yet major indicators of Chinese four of the past five months. Growth favor corporate investment by also three years, could eventually leave new Atlantic routes; The arrangement is possible be- sharing arrangement with Jet Blue $350 million order with Airbus to cline,” said Akira Maekawa, a Tokyo- demand—such as plunging imports in rural and urban incomes slowed in keeping lending costs low. households with more money to cause of the recent deregulation of Airways Corp. in the U.S. supply three A330-200s for the part- based economist for UBS Securities. and housing sales—signal the cur- 2008, which some economists ex- That may be one reason why the spend on other things. Ryanair drops bid airline marketing between the U.S. A few carriers have tried to take nership—which includes the route South Korea’s economy is brak- rent slowdown is already worse pect will translate into slower con- government’s initial announcement “These measures are designed to and the European Union, and marks advantage of the open-skies treaty from Washington to Madrid—as ing harder than many forecasters than the last one a decade ago, dur- sumption this year. of a four trillion yuan ($585 billion) treat both symptoms and root By Quentin Fottrell one of the first times that two carri- on a limited basis: British Airways well as two aircraft for two future and government officials expected ing the Asian financial crisis. China Many economists expect the lat- stimulus program in November fo- causes, to both overcome immedi- And Daniel Michaels ers have allied to target a third coun- PLC has established a subsidiary routes, Mr. Mannion said. just weeks ago. The central bank re- hasn’t published updated quarterly est weak data for China, and the likeli- cused almost entirely on govern- ate difficulties and lay a foundation try. Traditionally, airlines were lim- that now flies from Paris and Am- Analysts said the timing of the ported Thursday that gross domes- growth rates, making precise com- hood that conditions will continue to ment-led infrastructure projects for long-term development,” Ma DUBLIN—UAL Corp.’s United Air- ited to flying internationally only sterdam to New York, and Air deal could have been an effort by tic product shrank 5.6% in the fourth parisons impossible, but according worsen, will prompt Chinese authori- such as railroads and airports. Such Jiantang, the head of the National lines and Irish flag carrier Aer Lingus from their home country. France-KLM SA briefly operated Aer Lingus to help thwart a Œ748 mil- quarter from the previous quarter. to estimates by Goldman Sachs, the ties to cut interest rates further and spending can get investment mov- Bureau of Statistics, said Thursday. Group PLC Thursday announced an The U.S.-EU “open skies” treaty, flights from London to Los Angeles. lion ($973.7 million) takeover at- A big driver was a decline in man- fourth-quarter expansion is the announce more stimulus measures. ing into the economy fairly quickly. “I am confident that China’s con- unusual linkup for trans-Atlantic which took effect in March, allows But both of these operations faced tempt from Irish rival Ryanair Hold- ufacturing output, reflecting a slowest since the second quarter of But nearly two percentage points “Because the economy is bad, sumption can maintain a relatively flights between the U.S. and Euro- EU carriers to fly to any airport in headwinds because the carriers ings PLC. The Irish government France-Presse Agence downturn in exports to China, its 1998, when Goldman Sachs esti- of cuts in deposit rates since October there are lots of sales now,” said fast growth rate.” pean destinations outside Ireland. the U.S. from any airport in the EU needed to sell tickets in markets Thursday effectively ended the bid United Airlines and Aer Lingus will pair biggest customer. In December, mates the economy also grew 6.8%. haven’t had much impact on spend- Feng Airong, who works in a state Others are less optimistic. “Chi- The airlines, which already coop- and vice versa. where they lacked significant brand when, as Aer Lingus’s second-big- on Madrid to Washington, D.C. flights. South Korea’s exports to China fell Like consumers around the ing. China’s already-thrifty house- publishing house. She says she is na’s fiscal package is unlikely to cre- erate on flights between the U.S. Aer Lingus Chief Executive Der- recognition or customer allegiance. gest shareholder after Ryanair with 35%, worse than the 17.9% drop in to- world these days, Chinese people holds are instead socking away cash keeping an eye on her spending, in ate significant numbers of jobs or sup- and Ireland, plan to begin with mot Mannion said that, should the Aer Lingus and United aim to a 25.1% stake, it rejected Ryanair’s tal exports and accelerating from fret about their future. Cindy Wang, at an accelerating rate. Savings de- part because she’s trying to save port consumption in any meaningful flights between Madrid and Wash- partnership be successful, United overcome that problem by using bid for undervaluing Aer Lingus and ernment had made the wrong deci- the 33% decline in November. a 33-year-old employee of a Beijing posits in Chinese banks at the end of money to help her son study abroad way,” said Stephen Green, economist ington starting in March 2010. Both and Aer Lingus will form a separate United’s marketing heft in the U.S. threatening competition in the Irish sion, but that it would abide by the The export-driven city-state of advertising company, says she is December were up 26% from a year in a couple of years. “I just bought for Standard Chartered in Shanghai. carriers will market the flights and joint venture based in Europe United is America’s third-largest air- aviation market. decision and focus on growing its ex- Singapore also notched its deepest spending less and saving more be- earlier, twice as fast as the 13% in- several outdoor coats at a big dis- The high savings and low debt of have their flight numbers on the within two years, with Aer Lingus line by passenger traffic after Delta Ryanair said it thought the gov- isting operations. economic contraction on record in cause her job looks much less cer- crease in May and well up from the count, but the cost is still within my Chinese households at least mean route. But Aer Lingus will operate holding a 51% stake. the fourth quarter of 2008, and re- tain. Most of her company’s clients 5.8% gain in December 2007. budget,” Ms. Feng said. they are in a solid financial position, the planes and will be primarily re- “These deals are Aer Lingus’s ver- vised its outlook with a forecast that are car makers, who have responded “There is no evidence that a cut In recent weeks, new policies unlike many of their U.S. counter- sponsible for costs, while United sion of consolidation,” Mr. Mannion its economy will shrink as much as 5% to a sales decline by cutting ad bud- in interest rates reduces the house- have shown a greater focus on shor- parts. “Looking at household bal- INDEX TO PEOPLE in 2009. The government announced gets. “I don’t know whether I will be hold saving rate” in China, said Es- ing up consumption. Ahead of the tra- ance sheets, there is very great po- a stimulus package Thursday. laid off soon, though I’m working war Prasad, a professor at Cornell ditional Chinese New Year holiday, tential for consumption,” Yi Gang, a CORRECTIONS & AMPLIFICATIONS This index lists the names of businesspeople and government regulators who receive significant mention in today's Journal. Many of the goods Asian coun- very hard,” Ms. Wang said. University who has worked on the government said it would give deputy governor of the central For more people in the news, visit tries export to China are compo- Though headline retail sales China at the International Monetary one-time cash payments to the na- bank, said in a recent speech. 1 CareerJournal.com/WhosNews nents that are assembled into fin- were up 21.6% last year, many econo- Fund. “It’s very difficult for them, tion’s poorest households. The subsi- Whether policy makers can unlock Investment firm Fairfield Green- Medical Association and the Pharma- ished products and exported to the mists discount the figures because given the way things are set up, to dies range from 90 to 180 yuan ($13 that potential is a big question for wich Group said it hasn’t had any ceutical Research and Manufactur- U.S. and other markets. With U.S. im- they include purchases by compa- encourage consumption.” to $26) and will aid 74 million people. China and its neighbors. dealings with a Chicago-based char- ers of America, deny that they held Adamson, Simon.17 .... Dua, Anil .24...... Kumar, Anil.3 ...... Parsons, Richard.22 ..... Song Sang-hoon.5 ...... ports drying up, there have been nies and the government, not just Bank-deposit rates in China have The government has also ap- —Yuka Hayashi in Tokyo, Badreldin, Ahmed.24... . Echegoyen, Jaime.7 ...... Perkins, Tom.6 ...... Stausboll, Anne .21...... ity called December Rain. A Money & the events promoted by December Kumar, K. Ajay.3 ...... hopes China would rouse its own households. been so low for so long that cutting proved a long-discussed overhaul of Evan Ramstad in Seoul Ballmer, Steve.5...... Gadhafi, Moammar . 10 Kumar, S. Bharat.3 ...... Picard, Irving.21...... Steuart, John.22 ...... Investing article in some editions on Rain. Paul Saulnier, the executive di- Bergen, André.17...... Garg, Sunil.20 ...... Lewis, Kenneth Prasad, Eswar.27 ...... Stevens, Robert.5 ...... consumers and make up for at least Other short-term indicators from them doesn’t make much of a differ- the nation’s health-care system, and Kersten Zhang in Beijing Jan. 21 said that investors of the firm rector of December Rain, said Tues- Bischoff, Win.22 ...... Gavrilenkov, Yevgeny ...... 1,18,22,28 Prince, Charles.22 ...... Stringer, Howard.4 ...... some of that lost demand. An up- China aren’t encouraging. Measures ence to most households—espe- which is often criticized for the contributed to this article. sold inaugural-event tickets to De- day that he stepped down from the Bradford, Dave.20...... 1...... 8Liddell, Chris.5 ...... Rabinowitz, Matthew Tanner, Bruce.5 ...... Thain, John ...... 1,18,28 cember Rain, but the Journal didn’t organization. He didn’t return calls Brenner, Andrew.18 .... George, Freddie.7 ...... Liddy, Edward.20 ...... 2...... 2 Brown, Derek.4 ...... Ghanem, Shokri.10 ...... Rajagopalan, Tian Wenhua.11 ...... reach any Fairfield Greenwich inves- and emails Wednesday, and he Loughridge, Mark.7 ...... Tsekhomsky, Nikolai 20 tors or the firm for comment before didn’t put the Journal in touch with Bullock, Gareth.24 ...... Goldhaber, Nat.22 ...... Ma Shuning.11 ...... Narayanan.24 ...... Chung, T.H..5 ...... Gosney, Brett.10 ...... Raju, B. Rama.3 ...... Vadlamani, Srinivasan the article was published. The Jour- his lawyer, as he offered. Madoff, Bernard.21 ...... 3...... Clark, Rodney.20 ...... Green, Stephen.27 ...... Raju, B. Ramalinga.3 ... John Thain is ousted by Bank of America chief over missteps Madoff, Peter.21 ...... von Gruenberg, nal can’t verify that December Rain Coburn, Pip.5 ...... Hawks, Randy.22 ...... Raju, B. Suryanarayana Maekawa, Akira.27 ...... Hubertus.19...... paid investors, whom the charity de- Italian eyewear maker Luxot- Cohen, Michael.21 ...... Henderson, Fritz.5 ...... 3...... Continued from first page than expected. A person familiar stitute of Technology engineering and Fleming, for instance, went and a 32% decline in shares of Nas- Mannion, Dermot.2 ...... Wagoner, Rick.14 ...... clined to name, for the tickets. De- tica SpA announced last week that it Conrad, Lee.7...... Jackson, Michael J. . 15 Rees, Mike .24...... Wait, Christian.24 ...... choice. “Ken would not have left with Merrill’s bonus scheme said graduate had a Harvard MBA and without bonuses in 2007 and 2008. daq OMX Group Inc. cember Rain did auction off what it will suspend production at its Italian Courtenay, James.24 .... Jain, Abhinav.24 ...... Marchionne, Sergio.28 . Rometty, Ginni.7 ...... that meeting without a resigna- that executives typically are told had served as president of Goldman Mr. Montag, who started in Au- “There are some who think he Milanesi, Carolina.4 ...... Wang Chunguang.10 ... Dear, Joseph A..21 ...... Jobs, Steve.6 ...... Ross, Lester.11 ...... Wheeler, Peter.24 ...... said were inaugural tickets and factories for four days this quarter, Moiseyev, Alexei.18 ..... tion,” said one person familiar with what their bonus will be by the sec- Sachs. gust as Merrill’s global head of sales left his successor holding the bag,” promised winners access to inaugu- resulting in a temporary layoff of DiGiovanni, Mike.5 ...... Kalinske, Tom.22 ...... Schwarz, Gerhard.18 .... Wolters, Daniela.7 ...... Mr. Lewis’s thinking. ond week of January and the pay- Within weeks of his arrival, he and trading, was given a guaranteed at NYSE Euronext, says Richard Dimon, James.22 ...... Kallasvuo, Olli-Pekka 4 Murphy, Arun.24 ...... Shanker, Josh.20 ...... ral events sponsored by political or- some 6,000 workers. A Corporate Wong, Clarence.6...... Mr. Thain had lost Mr. Lewis’s ments are made in the second half of raised billions of dollars to cover payout of $39.4 million for 2008. Repetto, an analyst with Sandler Donahoe, John.7 ...... Kelley, Kevin.20 ...... Pandit, Vikram.22 ...... Sinclair, Matthew.19 ... Worman, Doug.20 ...... ganizations and lobbying groups. News article Wednesday about job Dong, Jonathan.6 ...... Kern, Frank.7 ...... Park Dong-wook.5 ...... Slater, Michael.24 ...... Zoutendijk, Olga.24 ..... confidence, said a person familiar the month. Some people inside Bank Merrill’s escalating losses. But like Mr. Kraus, who joined Merrill in Sep- O’Neill. “But he did turn the ship However, some of those organiza- cuts in the luxury-goods sector incor- Doyle, John.20 ...... Kroes, Neelie.20 ...... Parker, Morgan.6 ...... Solinger, Dorothy.10 ... Zumwinkel, Klaus.7 ...... with the situation, following a se- of America believe that Merrill ac- many other Wall Street chiefs, Mr. tember and left in late December, re- and orchestrate some dramatic tions, including the Democratic Na- rectly stated that the company laid ries of events in early December. It celerated the payouts to avoid hav- Thain underestimated the magni- ceived an exit payment triggered by changes.” tional Committee, the American off about 6,000 temporary workers. started when Mr. Lewis learned of ing them cut amid a much-leaner tude of the storm to come. “This Bank of America’s acquisition of In Davos, Mr. Thain was slated to mounting fourth-quarter losses at plan at Bank of America. problem is not a zero, but it is for Merrill of $25 million, according to speak Jan. 30 on a high-powered INDEX TO BUSINESSES Merrill from a transition team han- Some Merrill board members the most part behind us,” Mr. Thain people familiar with the matter. panel titled, “Scenarios for the Fu- dling the merger, rather than from have complained that Mr. Thain said in an interview with The Wall Mr. Fleming’s departure created ture of the Global Financial Sys- This index of businesses mentioned in today’s issue of The Wall Street Journal Europe is intended to include all significant references to compa- Mr. Thain himself. didn’t fully inform them that mount- Street Journal in mid-January unrest in the firm’s investment bank- tem.” Among the panel’s topics: nies. First reference to these companies appear in boldface type in all articles except those on page one and the editorial pages. When Mr. Lewis asked Mr. Thain ing losses at the bank threatened to 2008. ing department and a number of se- “The demise of independent invest- what happened, the Bank of Amer- derail the deal last month, until the In one of his first missteps as nior banker, including Andrea Orcel, ment banks,” according to the THE/FUTURE LEADERSHIP/INSTITUTE ica CEO didn’t get a “good explana- federal government agreed to step CEO, Mr. Thain, pressed for capital the head of Merrill Lynch Interna- World Economic Forum, which orga- Bringing Universities and Businesses Together Aberdeen Asset Amazon.com.7 ...... Bernard L. Madoff General Motors ...... 5,17 Northrop Grumman.5 ..... tion for what was happening and in with $20 billion in additional capi- and optimistic the market would tional, are considering leaving. nizes the annual event. Management.19 ...... American International Investment Securities Hewlett-Packard.6 ...... Novartis .7...... why,” this person said. Not only did tal and a sharing of losses on $118 bil- soon turn, cut deals with some early Tensions rose in December when Mr. Lewis is also under fire for Abraaj Capital.24 ...... Group .2...... 0.2...... 1HSBC Holdings...... 4,18 Occidental Petroleum.10. Mr. Thain not appear concerned lion in assets. investors in Merrill that would Mr. Thain’s behind-scenes-lobbying his handling of the Merrill situation. BlueBay Asset OMV .1...... 0 Adobe Systems.18 ...... AMR .2...... Huntsman .18...... about the losses, but he “didn’t re- At the center of the upheaval is prove costly to Merrill sharehold- for a bonus spilled out in public. Shareholders are asking why Mr. Advanced Micro Devices Apple ...... 4,5,6,18 Management.19 ...... Hyundai Motor ...... 5,21 Parkson Group.6 ...... EREF-2009 ally have a good grasp of what was the unexpected $15.31 billion fourth- ers. Mr. Thain promised a number of Most Wall Street CEOs, under fire Lewis didn’t discover some of the .5...... Autonomy .4...... BNP Paribas.18 ...... IBM ...... 5,7 Ping An Insurance going on,” this person added. quarter loss at Merrill. The loss was shareholders who invested in Mer- Turkish Aeon.6...... Bank of America Bolsas y Mercados Intel ...... 5,6,7 (Group) Co. of China 20 for mounting mortgage losses, went troubles at Merrill prior to the Sept. R&D Day European Regional Aer Lingus Group.2 ...... 1,18,22,28 Españoles.24 ...... Interwoven.4...... Prudential.20 ...... The Bank of America CEO also a surprise for a number of reasons, rill in December 2007 and January without bonuses in 2008. But Mr. 15 deal announcement, and why he Economic Forum Aflac.1...... 8Bank VTB.2...... 0BP.1...... 0Intesa Sanpaolo.1...... Prudential Financial.20 .. came to the conclusion that Mr. including the fact that Wall Street 2008 that if the bank issued addi- Thain, arguing he helped repair Mer- didn’t disclose the problems to Air France-KLM.2 ...... Bankinter .7...... British Airways.2 ...... Ivanhoe Cambridge.6 ...... Raytheon .5...... Thain had exercised “poor judg- had believed that Merrill’s biggest tional common stock at a lower rill and engineered the sale of the shareholders before the merger “Boosting R&D Alafi Capital.22 ...... Barclays...... 4,18,28 BT Group...... 7,18 Jet Blue Airways.2 ...... Remy Cointreau.7 ...... ment” on a number of fronts. He lost problem was losses tied to debt price within a year, the firm would firm to Bank of America, for months closed Jan. 1. California Public Repsol YPF.10 ...... Excellence in Times of “Human Capital Johnson & Johnson.7 ...... key people in the days after the pools underpinned by subprime se- compensate them. Within months, lobbied his board’s compensation “He and the board acted impru- Employees’ J.P. Morgan Chase.22 ...... Royal Bank of Scotland PLC.1 ...... 7 merger closed Jan. 1, including Mer- curities. But in a securities filing this the firm had to raise more cash at committee for a multimillion-dollar dently,” said Richard Finger, a part- Economic Downturn: Development and FREE daily access Retirement System.21 . KBC Group.18 ...... Royal Dutch Shell.4 ...... rill President Gregory Fleming and week, Merrill detailed a much wider $25 a share. Merrill issued addi- payment. Once his efforts became ner in Houston-based Finger Inter- International Migration 1 Carrefour.6...... Kia Motors .5...... Insights from Turkey” to WSJ.com Ryanair Holdings.2 ...... wealth-management chief Robert array of losses, including a commer- tional shares to pay off its earlier in- public, he came under fire. In the ests Number One Ltd., which owns Caterpillar .3...... Kleiner Perkins Caufield Management for a more Satyam Computer If you bought today’s paper from Centrica .7...... & Byers .2...... 2 McCann. A number of senior bank- cial-property write-down totalling vestors, diluting its common shares end he asked for no bonus and was more than 1 million shares. Services .3...... 29 January Competitive Europe” a retail outlet, simply register at: cFares .2...... 2LG Electronics.21 ...... ers, including Andrea Orcel and $1.13 billion, a leveraged loan write- by 39%. The dilution essentially cost awarded nothing. Finger Interests filed a suit Chrysler .1...... Sberbank.2...... 0 Fares Noujam, are also considering down of $1.9 billion and losses tied shareholders about $5 billion. Before arriving at Merrill, Mr. Thursday in federal court, arguing European Parliament wsj.com/reg/coupon Libyan National Oil.10 ... Schaeffler.19 ...... Citigroup ...... 3,18,22 Lloyd’s Banking Group .17 leaving. to credit bets totalling $3.2 billion. At the same time, Mr. Thain Thain merged the centuries-old pri- that the bank and its directors failed 8-9 June, Nova Gorica, or renew at: wsj.com Claremont Creek Sequoia Capital.22 ...... L.M. Ericsson.4 ...... Shijiazhuang Sanlu Mr. Thain also left for a vacation The recent missteps are simply made some key hiring decisions vate New York Stock Exchange with to disclose “material” information www.turboppp.org/trday Slovenia Today's code is: EUROPE-3-776 Ventures.22 ...... Lockheed Martin ...... 5,18 in Vail, Colo., after the losses came the latest in a string of decisions Mr. that proved divisive. Mr. Thain took a publicly traded company that spe- to shareholders. Mr. Finger added Coca-Cola Co..3 ...... Group .1...... 1 London Stock Exchange Siemens .4...... to light, accelerated bonus pay- Thain has made since his arrival at over from Stanley O’Neal and inher- cialized in computerized trading. that Mr. Lewis should give up his ti- Continental Corp..19 ...... Group .2...... 4Société Générale .18...... ments at Merrill so they could be col- Merrill that have proven costly to ited Mr. O’Neal’s executive team. A He also merged the Big Board with tle as chairman so the board can be- www.eref.si THE WALL STREET JOURNAL EUROPE (ISSN 0921-99) Credit Suisse Group.18 ... Luxottica.2...... Boulevard Brand Whitlock 87, 1200 Brussels, Belgium Sony ...... 4,5,21 lected before the end of the year and the 53-year-old executive. He was number of executives left, but a one of Europe’s largest exchange op- come more “independent.” Delta Air Lines.2 ...... Maytas Properties .3...... Telephone: 32 2 741 1211 Fax: 32 2 741 1600 Sony Ericsson.4 ...... scheduled a trip this week to attend heralded as the dream candidate handful, notably Messrs. Fleming erators to give the company expo- Bank of America’s board is sched- Deutsche Post .7...... Merrill Lynch.1 ...... SUBSCRIPTIONS, inquiries and address changes to: Standard Chartered.24 .... the World Economic Forum in Da- when he became chief executive and and McCann, stayed. Mr. Fleming, sure to faster-growing derivatives uled to meet next week in Charlotte, Telephone: +44 (0) 207 309 7799 DryShips.1...... 8Microsoft ...... 4,5,18 State Farm Insurance.3 . Contact: [email protected] Calling time from 8am to 5.30pm GMT vos, Switzerland, even though Bank chairman of Merrill when he landed an investment banker, was named easyJet ...... 7,18 Mitsubishi Estate.21 ...... Taubman Centers.6 ...... products and international mar- but a person familiar with the E-mail: [email protected] Website: www.services.wsje.com of America had signaled that such a The Wall Street Journal Europe is Advertising Sales worldwide through Dow Jones eBay ...... 7,18 Motorola .6...... Tesco PLC .6...... there in late 2007. president and Mr. McCann contin- kets. board’s deliberations said Mr. read every day by 27,000 students at 180 top International. Frankfurt: 49 69 971428 0; London: 44 207 842 Eni .1...... 0National Australia Bank Toyota Motor.5...... trip wasn’t a good idea, this person The Merrill that Mr. Thain inher- ued to oversee the firm’s powerful But Mr. Thain left before the new Lewis’s job isn’t in danger, nor is his business schools and university campuses across 9600; Paris: 33 1 40 17 17 01 Euroclear .2...... 0.2...... 1 said. Bank of America chief risk of- ited was weighed down by billions retail brokerage network. company, NYSE Euronext, could title as chairman. Bank of America’s Europe, a program supported by Printed in Belgium by Concentra Media N.V. Printed in Germany by UAL .2...... Dogan Media Group / Hürriyet A.S. Branch Germany. Printed in Exxon Mobil.10 ...... New Star Asset Unicredit .1...... ficer Amy Woods Brinkley usually of dollars in soured mortgages and Mr. Thain also offered Goldman gather momentum. Amid a toughen- board, this person said, was in- Switzerland by Zehnder Print AG Wil. Printed in the United Kingdom by Fedex .4...... Management Group .19 Wal-Mart Stores.6 ...... makes that trip but the company de- he was untainted by the growing cri- colleagues Peter Kraus and Mr. Mon- ing market and the challenges with formed about Merrill’s larger-than- Newsfax International Ltd., London. Printed in Italy by Telestampa Newcrest Mining.21 ...... Centro Italia s.r.l. Printed in Spain by Bermont S.A. Printed in Ireland Fiat ...... 1,18 Westpac Banking.21 ...... cided not to send her this year. sis that had already cost some CEOs tag multimillion-dollar packages to integrating the two companies, expected losses shortly after Mr. by Midland Web Printing Ltd. Printed in Israel by The Jerusalem Post Fonterra Cooperative News Corp..7 ...... William Morrison Group. Printed in Turkey by GLOBUS Dünya BasInevi. Vitriol between the Bank of their jobs, including his predeces- join the financially strapped Mer- NYSE Euronext stock has fallen Lewis knew about them. Group .1...... 1Nokia ...... 4,5,18 Supermarkets.7 ...... Registered as a newspaper at the Post Office. America and Merrill camps also sor, Stanley O’Neal. rill, offending many people at the more than 75% since the beginning —Aaron Lucchetti Trademarks appearing herein are used under license from Dow Jones Gene Security Network Nokia Siemens Yahoo .6...... & Co. © 2008 Dow Jones & Company All rights reserved. .2...... 2Networks.4 ...... Zurich Financial Services stemmed from the fact that Merrill Mr. Thain was dubbed Mr. Fix It. firm, including others on the execu- of 2007, compared with a 65% fall at and Carrick Mollenkamp Editeur responsable: Daniel Hertzberg M-17936-2003 General Dynamics.5 ...... Nomura Holdings.24 ...... 2...... 0 had paid out bonuses much earlier The level-headed Massachusetts In- tive committee. Messrs. McCann rival exchange operator CME Group contributed to this article. 26 FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 THE WALL STREET JOURNAL. THE WALL STREET JOURNAL. FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 3 GLOBAL MARKETS LINEUP LEADING THE NEWS

Commodities Prices of futures contracts with the most open interest Currencies London close on Jan. 22 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 ONE-DAY CHANGE Contract Contract Argentina peso-a 4.5031 0.2221 3.4725 0.2880 Euro zone euro 1 1 0.7711 1.2968 Commodity Exchange Last price Net Percentage high low Brazil real 3.0280 0.3302 2.3350 0.4283 1-mo. forward 1.0006 0.9994 0.7716 1.2961 ECB explains reasons for caution on rates Corn (cents/bu.) CBOT 387.50 –2.75 –0.70% 816.00 305.50 Canada dollar 1.6366 0.6110 1.2620 0.7924 3-mos. forward 1.0015 0.9985 0.7723 1.2949 self behind the curve,” said Mr. Bini euro-zone country to default. lower the bank’s key rate much fur- Soybeans (cents/bu.) CBOT 1012.00 –8.50 –0.83 1,653.50 779.25 1-mo. forward 1.6371 0.6108 1.2624 0.7921 6-mos. forward 1.0022 0.9978 0.7729 1.2939 No deflation threat, Smaghi, who was born in Florence, The region’s economic outlook ther. “We should not go in a terri- Different strokes Wheat (cents/bu.) CBOT 566.75 –5.00 –0.87 1,275.00 471.00 3-mos. forward 1.6368 0.6109 1.2622 0.7923 Czech Rep. koruna-b 27.825 0.0359 21.457 0.0466 6-mos. forward 1.6352 0.6115 1.2610 0.7930 Italy, and holds a doctorate in eco- darkened further Thursday. New in- tory in which real [inflation-ad- Live cattle (cents/lb.) CME 85.400 0.200 0.23% 119.200 82.400 Denmark krone 7.4530 0.1342 5.7472 0.1740 Key interest rates at the European Chile peso 804.53 0.001243 620.40 0.001612 fear of a new bubble nomics from the University of Chi- dustrial orders posted their largest justed] interest rates are substan- Cocoa ($/ton) ICE-US 2,580 –22 –0.85 3,228 1,884 Hungary forint 284.46 0.003515 219.36 0.004559 Central Bank, Bank of England and Colombia peso 2910.67 0.0003436 2244.50 0.0004455 cago. “And the greater will be the annual drop on record in Novem- tially negative,” he said, noting Coffee (cents/lb.) ICE-US 119.45 1.90 1.62 181.60 102.15 Norway krone 9.0291 0.1108 6.9626 0.1436 the U.S. Federal Reserve Ecuador US dollar-f 1.2968 0.7711 1 1 guide policy making seeds of the next crisis. I think we ber, sliding 26.2% from the year be- such policies had proved to create Sugar (cents/lb.) ICE-US 12.38 –0.22 –1.75 15.85 9.89 Poland zloty 4.3676 0.2290 3.3680 0.2969 Mexico peso-a 18.0544 0.0554 13.9223 0.0718 should learn from experience.” fore as tight financing strangled “huge distortions in the economy.” 6% Cotton (cents/lb.) ICE-US 48.93 1.70 3.60 100.41 39.23 Russia ruble-d 42.387 0.02359 32.686 0.03059 Peru sol 4.0908 0.2445 3.1545 0.3170 By Joellen Perry Mr. Bini Smaghi’s comments are global demand, according to the Eu- At the ECB’s Jan. 15 meeting, Crude palm oil (ringgit/ton) MDEX 1,870.00 61 3.37 2,052 1,350 Sweden krona 10.6771 0.0937 8.2334 0.1215 Uruguay peso-e 29.567 0.0338 22.800 0.0439 among the clearest explanations ropean Union’s statistics office. President Trichet suggested policy 5 Cocoa (pounds/ton) LIFFE 1,969 –11 –0.56 1,994 992 Switzerland franc 1.4966 0.6682 1.1541 0.8665 U.S. dollar 1.2968 0.7711 1 1 FRANKFURT—The European yet for why the ECB—which sets in- French consumer spending on man- makers had a lower limit for rates, Robusta coffee ($/ton) LIFFE 2,135 83 4.04 2,747 1,580 1-mo. forward 1.4961 0.6684 1.1537 0.8668 4 ECB Venezuela bolivar 2.78 0.359116 2.15 0.465701 3-mos. forward 1.4945 0.6691 1.1525 0.8677 Central Bank is likely to move cau- terest rates for the $14 trillion euro- ufactured goods fell by a steeper- but declined to specify what it was. 2% Copper (cents/lb.) COMEX 139.60 –3.75 –2.62 398.40 125.50 ASIA-PACIFIC tiously in lowering its key rate zone economy, second in size only than-expected 1.7% in December Significantly, Mr. Bini Smaghi 3 6-mos. forward 1.4916 0.6704 1.1502 0.8694 BOE Gold ($/troy oz.) COMEX 858.80 8.70 1.02 1,045.00 688.00 Australia dollar 1.9731 0.5068 1.5215 0.6573 to the U.S.—hasn’t rushed to follow from a year earlier, according to signaled that the ECB could be flexi- Turkey lira 2.1441 0.4664 1.6534 0.6048 closer to zero, a top policy maker 2 1.5% Silver (cents/troy oz.) COMEX 1136.50 4.00 0.35 2,122.50 8.50 China yuan 8.8663 0.1128 6.8371 0.1463 U.K. pound 0.9379 1.0662 0.7232 1.3827 there suggested, because the bank other central banks in bringing its French national statistics office. ble. Faced with an “extreme situa- Aluminum ($/ton) LME 1,347.00 –15.00 –1.10 3,340.00 1,347.00 Hong Kong dollar 10.0622 0.0994 7.7593 0.1289 U.S. 1-mo. forward 0.9385 1.0656 0.7237 1.3818 doesn’t see deflation threatening key rate very close to zero. The U.S. Inflation pressures are fading. tion” of deflation, he said, “one can- 1 Fed Tin ($/ton) LME 11,400.00 200.00 1.79 25,450 9,750 India rupee 63.6794 0.0157 49.1050 0.0204 3-mos. forward 0.9387 1.0654 0.7238 1.3816 the euro zone now and is Federal Reserve last Falling commodity prices pushed not exclude a zero-rate scenario.” 0.25% Copper ($/ton) LME 3,200.00 –50.00 –1.54 8,811.00 2,815.00 Indonesia rupiah 14524 0.0000689 11200 0.0000893 0 6-mos. forward 0.9386 1.0654 0.7238 1.3816 wary of creating another month cut its key rate to euro-zone inflation to a 26-month He emphasized: “that is not the Lead ($/ton) LME 1,105.00 –15.00 –1.34 3,460.00 870.00 Japan yen 115.51 0.008658 89.07 0.011227 2006 '07 '08 '09 MIDDLE EAST/AFRICA credit-fueled bubble. near zero and the Bank of low of 1.6% in December, below the case right now in the euro area.” Zinc ($/ton) LME 1,132.00 –60.00 –5.03 2,840.00 1,065.00 1-mo. forward 115.45 0.008662 89.03 0.011233 Economic activity is England earlier this ECB’s preferred level of just under The bloc has other problems. In Sources: European Central Bank; Bank of England; 3-mos. forward 115.29 0.008674 88.90 0.011248 Bahrain dinar 0.4889 2.0456 0.3770 2.6527 Nickel ($/ton) LME 11,125 25 0.23 33,600 9,000 contracting in Europe, month cut its policy rate 2%. Inflation should continue fall- the past two weeks, amid concern U.S. Federal Reserve 6-mos. forward 115.02 0.008694 88.70 0.011274 Egypt pound-a 7.1908 0.1391 5.5450 0.1803 Crude oil ($/bbl.) NYMEX 43.67 0.12 0.28 148.35 38.00 threatening to drag the 16 to 1.5%, the lowest in the that some euro-zone governments Malaysia ringgit-c 4.6792 0.2137 3.6083 0.2771 Israel shekel 5.1146 0.1955 3.9440 0.2535 Heating oil ($/gal.) NYMEX 1.3456 –0.0346 –2.51 4.2895 1.2396 countries that now share bank’s 315 years. will struggle to finance fiscal-stim- New Zealand dollar 2.4491 0.4083 1.8886 0.5295 Jordan dinar 0.9176 1.0899 0.7076 1.4133 RBOB gasoline ($/gal.) NYMEX 1.1191 –0.0807 –6.73 3.6130 0.8708 The ECB has lowered The region’s ulus and bank-rescue packages as countries. But I think the commit- Pakistan rupee 103.485 0.0097 79.800 0.0125 Kuwait dinar 0.3774 2.6499 0.2910 3.4364 the euro into their deepest Natural gas ($/mmBtu) NYMEX 4.662 –0.088 –1.85 14.169 4.500 Philippines peso 61.403 0.0163 47.350 0.0211 Lebanon pound 1947.15 0.0005136 1501.50 0.0006660 recession since World War its key rate four times in tax receipts dwindle, Standard & ment to bringing that debt down af- Brent crude ($/bbl.) ICE-EU 45.39 0.37 0.82 150.53 38.80 economic outlook Singapore dollar 1.9426 0.5148 1.4980 0.6676 Saudi Arabia riyal 4.8636 0.2056 3.7505 0.2666 II. But without evidence of as many months to 2%, Poor’s cut its credit ratings for terward is also clear.” Gas oil ($/ton) ICE-EU 426.75 –8.75 –2.01 1,345.25 408.25 South Korea won 1782.19 0.0005611 1374.30 0.0007276 South Africa rand 13.0538 0.0766 10.0662 0.0993 deflation—a prolonged fall from 4.25% in October. Greece, Spain and Portugal. Many The strains are also pushing in prices and price expecta- That is the fastest pace of darkened further analysts expect Ireland, which was ECB policy makers to rebuff specu- Source: Thomson Reuters; WSJ Market Data Group Taiwan dollar 43.495 0.02299 33.540 0.02982 United Arab dirham 4.7636 0.2099 3.6734 0.2722 WSJ.com Thailand baht 45.271 0.02209 34.910 0.02865 SDR -f 0.8667 1.1539 0.6683 1.4963 tions—“there is little room Lorenzo Bini cuts in the bank’s 10-year put on credit watch earlier this lation that the bloc could break up. Follow the markets throughout the day, with updated stock quotes, news and commentary at left to reduce the nominal Smaghi history. After the bank cut Thursday. month, will be next. The central bank sets rates for the WSJ.com/Europe. Also, receive email alerts that summarize the day’s trading in Europe and Asia. a-floating rate b-commercial rate c-government rate c-commercial rate d-Russian Central Bank rate f-Special Drawing Rights from the Inter- interest rate” below its cur- its key rate by a half-per- Amid those strains, markets are bloc, so struggling countries can’t To sign up, go to WSJ.com/Online Today national Monetary Fund ; based on exchange rates for U.S., British and Japanese currencies. rent 2%, Lorenzo Bini Smaghi said centage point on Jan. 15, President increasing bets that a euro-zone na- slash interest rates or devalue cur- Note: Based on trading among banks in amounts of $1 million and more, as quoted by Thomson Reuters. in an interview. Jean-Claude Trichet suggested pol- ing in coming months as the effects tion could default on its debt. In rencies to boost growth. Econo- Mr. Bini Smaghi, 52 years old, is icy makers would slow the pace, of last year’s high energy prices the credit-default swaps market— mists see such a splintering as far- a monetary-policy centrist who holding steady in February. Mar- wear off, and rise again toward where investors buy and sell deriva- fetched. A defector would face Major stock market indexes Stock indexes from around the world, grouped by region. Shown in local-currency terms. sits on the ECB’s 22-member Gov- kets expect the protracted slow- year end. “We don’t have evi- tives that pay off when a debt-is- sharply higher debt costs, as its erning Council—which sets down will push the ECB to another dence,” said Mr. Bini Smaghi, “that suer defaults—the cost of swaps euro-denominated debt would Price-to- PREVIOUS SESSION PERFORMANCE Price-to- PREVIOUS SESSION PERFORMANCE rates—as well as its six-member Ex- cut in March, to a record low of there is going to be deflation.” linked to Ireland has risen tenfold need to be repaid with a less-valu- 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. ecutive Board. 1.5%. Forecasters and markets con- since September. Bets on defaults able currency. 9 EUROPE DJ Stoxx 600 182.85 –1.67 –0.91% –7.1% –43.2% … Russia RTSI 515.51 –14.58 –2.8% –18.4% –74.1% Cutting rates sharply now, he Mr. Bini Smaghi also dismissed as tinue to expect that longer-term in- by Greece, Spain and Portugal hit Mr. Bini Smaghi suggested the 9 DJ Stoxx 50 1898.46 –18.39 –0.96 –8.1% –41.8% 7 Spain IBEX 35 8159.3 –71.4 –0.87 –11.3% –37.7% said, makes it more difficult to “irrational” rising market bets that flation in the bloc will hover highs this week. political burden could be equally 8 Euro Zone DJ Euro Stoxx 199.88 –2.28 –1.13 –10.3% –44.6% 15 Sweden OMX Stockholm 189.42 –1.46 –0.76 –7.2% –39.0% raise them back to the right level ballooning debt loads—which have around the bank’s goal of just un- Mr. Bini Smaghi dismissed the onerous. “It would also imply exit- once recovery takes hold. “The caused three euro-zone countries to der 2%. If inflation hews to those ex- rising spread as “quite irrational. ing from the European Union,” he 8 DJ Euro Stoxx 50 2160.07 –28.36 –1.30 –11.9% –43.3% 11 Switzerland SMI 5329.44 25.27 0.48% –3.7% –30.7% lower rates are brought, the more suffer credit-rating downgrades in pectations, Mr. Bini Smaghi sig- It’s clear that debt is going to go up noted. “And in the end, no country 5 Austria ATX 1591.88 –20.81 –1.29 –9.1% –59.1% … Turkey ISE National 100 24641.93 –94.19 –0.38 –8.3% –45.3% likely the central bank will find it- less than two weeks—could push a naled he would be reluctant to in the next few years in several would be willing to face this.” 6 Belgium Bel-20 1805.38 10.41 0.58% –5.4% –51.0% 8 U.K. FTSE 100 4052.23 –7.65 –0.19 –8.6% –31.0% 6 Czech Republic PX 767.8 –16.6 –2.12 –10.5% –49.6% 9 ASIA-PACIFIC DJ Asia-Pacific 87.20 0.32 0.37 –6.8% –38.2% 9 Denmark OMX Copenhagen 231.06 –0.92 –0.40 2.2% –39.9% … Australia SPX/ASX 200 3486.8 44.0 1.28 –6.3% –37.5% 8 Finland OMX Helsinki 4943.63 –159.05 –3.12 –8.5% –52.3% … China CBN 600 16708.24 197.24 1.19 13.2% –57.9% 7 France CAC-40 2869.62 –35.95 –1.24 –10.8% –41.6% 8 Hong Kong Hang Seng 12657.99 74.36 0.59 –12.0% –46.2% Indian prosecutors say Satyam founder siphoned funds 9 Germany DAX 4219.42 –41.73 –0.98 –12.3% –38.1% 10 India Sensex 8813.84 34.67 0.39 –8.6% –48.8% The disgraced former chairman to buythousands of acres of land, the globescrambletoretainlargecorpo- also is in custody but isn’t currently tionshipmanagersaretalkingtocus- … Hungary BUX 11643.58 –199.02 –1.68 –4.9% –51.2% … Japan Nikkei Stock Average 8051.74 150.10 1.90 –9.1% –38.5% of Satyam Computer Services Ltd., prosecutors said. Prosecutors say rate clients and employees in an ef- being interrogated, according to de- tomers and offering them the chance 2 Ireland ISEQ 2234.99 42.86 1.96 –4.6% –67.2% … Singapore Straits Times 1708.77 4.25 0.25 –3.0% –44.0% B. Ramalinga Raju, used salary pay- they are investigating but didn’t al- fort to move beyond the scandal. fense lawyers working on the case. A totalkdirectlytothenewboardofdi- 6 Italy S&P/MIB 17369 –315 –1.78 –10.7% –49.3% 11 South Korea Kospi 1116.23 12.62 1.14 –0.7% –32.9% ments to 13,000 fictitious employ- lege that Mr. Raju’s mother or In a letter to the board released hearing on bail for all three men is rectors that was installed by the gov- 4 Netherlands AEX 235.46 –2.25 –0.95 –4.3% –47.0% 9 AMERICAS DJ Americas 209.47 –2.17 –1.03 –7.4% –39.2% ees to siphon millions of dollars brother were involved. They didn’t Jan. 7,Mr.Raju outlined a years-long scheduled for Friday. ernmentinthewakeofMr.Raju’scon- 6 Norway All-Shares 267.96 –3.32 –1.22 –0.8% –41.8% … Brazil Bovespa 37922.31 –620.59 –1.61 1.0% –34.0% from the Indian outsourcer for land offer further details on how the al- fraudthathesaidinflatedthecompa- A Satyam spokeswoman said fession and resignation as chairman. 17 Poland WIG 24932.01 –696.78 –2.72 –8.4% –47.2% 11 Mexico IPC 19532.29 35.19 0.18 –12.7% –30.3% purchases, prosecutors said Thurs- leged diversion of funds took place. ny’s results, including a fictitious that the company is cooperating Satyam managers are sending 9 Portugal PSI 20 6263.83 39.80 0.64 –1.2% –43.1% day. Prosecutors made the claims in a bank balance of more than $1 billion. fully with authorities, but declined daily emails to employees to keep Prosecutors in the southern In- hearing Thursday where the state po- But in the letter he said neither to comment further on the allega- them focused on work. Satyam has *P/E ratios use trailing 12-months, as-reported earnings Reuters Group PLC is the primary data provider for several statistical tables in The Wall Street Journal, including foreign stock quotations, futures and futures dian city of Hyderabad, where the lice for the state of Andhra Pradesh he nor any family member benefited tions because the matter is still un- in some cases asked its customers Note: Americas index data are as of 3:00 p.m. ET. Sources: Thomson Reuters; WSJ Market Data Group options prices, and foreign exchange tables. Reuters real-time data feeds are used to calculate various Dow Jones Indexes. asked for more time to interrogate financially from the fraud. He also der investigation. to put on town-hall-type meetings By Eric Bellman in Mr. Raju and Satyam’s former chief stated that no other family member The Raju family has been a big in- to reassure Satyam staff that the Dow Jones and Dow Jones Stoxx Indexes MSCI indexes Hyderabad, India financial officer, Srinivasan Vadla- except one brother, former Satyam vestor in land around Hyderabad for contracts are safe. “If there is busi- and Niraj Sheth in New Delhi mani, who is also in custody. managing director B. Rama decades but has snapped ness, there are jobs,” Ashish Price-to- Price-to- Developed and emerging-market regional and country indexes Raju, was aware of the up thousands of acres in Patharkar, head of the Microsoft Dividendearnings PERFORMANCE (euros) PERFORMANCE (U.S. dollars) Dividendearnings PERFORMANCE (euros) PERFORMANCE (U.S. dollars) from MSCI Barra as of January 21, 2009 “The funds of Satyam have been 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. technology-outsourcing firm is diverted to many other companies,” scheme, and that he con- the past five years. Much technology account, says he tells his 3.82% 9 World -a % % 156.27 –0.53%–42.5% 6.17% 9 U.S. Select Dividend -b % % 503.00 –1.96%–37.8% Price-to- LOCAL-CURRENCY based, told a criminal court that Sa- cocted it to protect Satyam of their land holdings workers regularly. “Everything like Dividend earnings PERFORMANCE K. Ajay Kumar, assistant prosecutor, % Global Dow 1004.10 –0.15% –36.1% 1390.78 1.14%–43.4% 4.83% 12 Infrastructure 1213.40 –0.48% –27.2% 1508.73 0.81%–35.5% yield ratio Morgan Stanley Index Last Daily YTD 52-wk. tyam has only about 40,000 employ- told a packed courtroom. Investiga- from becoming a takeover have ended up in the com- salaries will fall in place.” target. pany Maytas Properties 4.79% 9 Stoxx 600 182.90 –0.91% –43.2% 176.98 –0.26%–50.0% 2.83% 5 Luxury 549.40 0.43% –42.0% 607.43 1.73%–48.6% 3.90% 10 ALL COUNTRY (AC) WORLD* 207.39 1.69%–48.6% –48.6% ees instead of the 53,000 it claims. tors need more time with Mr. Raju At the top of the list of concerns Since then, the Raju broth- Ltd., which is also being 4.82% 9 Stoxx Large 200 198.50 –1.00% –43.1% 191.10 –0.35%–49.9% 2.93% 6 BRIC 50 232.20 –0.27% –50.4% 288.70 1.02%–56.0% 3.80% 11 World (Developed Markets) 838.42 1.92%–47.2% –47.2% Prosecutors claimed the money, and Mr. Vadlamani to figure out coming from customers and employ- ers and Mr. Vadlamani have investigated by authori- 4.66% 10 Stoxx Mid 200 160.40 –0.44% –42.8% 154.39 0.22%–49.7% 4.10% 3 Africa 50 524.60 0.70% –50.5% 434.21 2.00%–56.1% 3.40% 11 World ex-EMU 99.45 2.38%–45.0% –45.0% in the form of salaries paid to ghost where the money has gone, Mr. Ku- ees are the company’s cash-flow employees, came to around $4 mil- been arrested on charges of ties in connection with 4.52% 10 Stoxx Small 200 96.20 –0.33% –46.0% 92.56 0.32%–52.4% 8.93% 4 GCC % % 983.89 –0.29%–64.8% 3.70% 11 World ex-UK 845.20 2.36%–46.1% –46.1% mar said. problems. The new directors have 4.91% 8 Euro Stoxx 199.90 –1.13% –44.6% 193.47 –0.48%–51.2% 4.59% 9 Sustainability 620.90 –1.07% –37.9% 679.64 –0.39%–45.3% 4.80% 9 EAFE 1,095.15 –0.70%–51.4% –51.4% lion a month. The money was di- forgery, cheating and breach the Satyam fraud. said they are approaching custom- S. Bharat Kumar, a defense law- of trust. 4.91% 8 Euro Stoxx Large 200 213.90 –1.24% –45.3% 205.74 –0.59%–51.8% 2.97% 10 Islamic Market -a % % 1381.69 –0.63%–36.4% 4.10% 8 Emerging Markets (EM) 515.16 –0.46%–58.6% –58.6% verted through front companies and Apart from the police, ers and asking them to pay what yer for the Raju family and Mr. Vadla- Mr. Kumar, the defense Satyam is also being 4.87% 9 Euro Stoxx Mid 200 186.00 –0.51% –40.3% 178.89 0.14%–47.4% 3.24% 9 Islamic Market 100 1458.40 –1.85% –22.6% 1618.02 –1.18%–31.8% 5.40% 8 EUROPE 64.54 –0.68%–49.4% –49.4% through accounts belonging to one they owe as early as possible so that mani, said the prosecution’s claims lawyer, said it would be im- probed by the govern- 5.03% 11 Euro Stoxx Small 200 108.50 –0.68% –44.0% 104.28 –0.03%–50.7% 3.24% 9 Islamic Turkey -c % % % % 6.20% 7 EMU 119.55 –0.66%–57.3% –57.3% ofMr.Raju’sbrothersandhismother B. Ramalinga the company has sufficient operat- are based on speculation and are possible for anyone to juggle ment’s Serious Fraud In- 8.68% 6 Stoxx Select Dividend 30 1072.80 –0.85% –60.1% 1189.83 –0.20%–64.8% 2.92% 12 Wilshire 5000 % % 8306.71 –2.09%–39.0% 5.60% 9 Europe ex-UK 71.67 –0.03%–48.6% –48.6% Raju ing funds to survive. “absolutely false.” He said B. Ramal- 13,000 fake employee ac- vestigation Office and the 7.23% 7 Euro Stoxx Select Div 30 1203.70 –0.63% –57.8% 1340.17 0.02%–62.8% % DJ-AIG Commodity 115.10 –3.21% –33.7% 108.32 –2.58%–41.6% 7.40% 6 Europe Value 69.13 –0.48%–54.4% –54.4% Satyamsufferedamajorblowear- International Investor inga Raju stood by his original con- counts. He also denied the prosecu- Securitiesand ExchangeBoard ofIn- State Farm In- *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: Dow Jones Indexes 3.60% 11 Europe Growth 58.34 –0.86%–44.1% –44.1% lier this week, when fession and that he didn’t profit tion’s claim that Mr. Raju admitted dia, the financial-markets regulator. suranceoftheU.S.announcedthatit 5.40% 7 Europe Small Cap 98.54 –0.28%–54.2% –54.2% from the fraud and no funds were di- to the fake employee accounts un- As the investigations gather pace, was ending its business with Sa- 4.50% 4 EM Europe 146.86 2.58%–69.5% –69.5% Money management Cross rates U.S.-dollar and euro foreign-exchange rates in global trading verted. “It is nothing but their imagi- der interrogation. Satyam executives have been push- tyam. A number of others could 5.10% 6 UK 1,202.25 –0.76%–37.4% –37.4% Venture-capital firms nation,” Mr. Kumar said. Prosecutors alleged that funds ing to retain the clients and employ- likely follow suit, industry analysts 5.60% 8 Nordic Countries 95.11 2.47%–53.9% –53.9% USD GBP CHF SEK RUB NOK JPY ILS EUR DKK CDN AUD The defense lawyer also said were diverted from Satyam through ees the company needs to survive the say.Amongtheoutsourcer’sremain- 3.50% 3 Russia 366.99 3.55%–75.6% –75.6% decide which of their Australia 1.5215 2.1038 1.3183 0.1848 0.0465 0.2185 0.0171 0.3858 1.9731 0.2647 1.2056 ... that Mr. Raju’s mother and a accounts owned by Mr. Raju’s mother crisis. ingtopclientsareCitigroupInc.,Cat- Canada 1.2620 1.7450 1.0935 0.1533 0.0386 0.1813 0.0142 0.3200 1.6366 0.2196 ... 0.8294 4.50% 10 South Africa 542.20 –0.78%–24.0% –24.0% young to forsake > Page 22 brother, B. Suryanarayana Raju, and B. Suryanarayana Raju. In addi- Anil Kumar, head of the Satyam’s erpillar Inc., and Coca-Cola Co. A Denmark 5.7472 7.9467 4.9798 0.6980 0.1758 0.8254 0.0645 1.4572 7.4530 ... 4.5540 3.7773 AC ASIA PACIFIC EX-JAPAN –58.3% 5.10% 9 221.14 –2.03% –58.3% weren’t involved in Satyam or the tion to denying either relative had division for banking and financial- Citigroup representative said it is Euro 0.7711 1.0662 0.6682 0.0937 0.0236 0.1108 0.0087 0.1955 ... 0.1342 0.6110 0.5068 2.80% 12 Japan 484.98 –2.38%–48.4% –48.4% fraud in any way. anyroleinSatyamorthefraud,Mr.Ku- services clients, has been going continuing its relationship with Sa- Israel 3.9440 5.4534 3.4174 0.4790 0.1207 0.5665 0.0443 ... 5.1146 0.6862 3.1252 2.5922 3.10% 10 China 35.78 –2.83%–58.1% –58.1% Japan 89.0700 123.1571 77.1770 10.8181 2.7250 12.7926 ... 22.5837 115.5060 15.4980 70.5784 58.5413 Prosecutors didn’t provide any mar said B. Suryanarayana Raju’s door to door to meet each of Sa- tyam; a Caterpillar spokesman de- 1.80% 10 India 338.56 –3.33%–60.4% –60.4% Norway 6.9626 9.6272 6.0329 0.8457 0.2130 ... 0.0782 1.7654 9.0291 1.2115 5.5171 4.5762 evidence in open court to substanti- home and office were raided by au- tyam’s largest banking customers in clined to comment. A Coca-Cola 2.70% 9 Korea 302.12 –2.34%–41.5% –41.5% Russia 32.6861 45.1951 28.3217 3.9699 ... 4.6945 0.3670 8.2876 42.3873 5.6873 25.9002 21.4829 ate their claims. But the allegations thorities Wednesday and a truckload New York. spokeswoman said the company is 8.50% 8 Taiwan 159.62 0.26%–52.2% –52.2% Sweden 8.2334 11.3843 7.1340 ... 0.2519 1.1825 0.0924 2.0876 10.6771 1.4326 6.5241 5.4114 suggest that the fraud at Satyam ran of documents removed. “Itwasa roadshow ofsorts,”said reviewing its relationship with Sa- Switzerland 1.1541 1.5958 ... 0.1402 0.0353 0.1658 0.0130 0.2926 1.4966 0.2008 0.9145 0.7585 2.80% 15 US BROAD MARKET 916.37 4.40%–42.6% –42.6% muchdeeperthantheschemeadmit- After Thursday’s hearing, the Mr. Kumar, who added that he has tyam. U.K. 0.7232 ... 0.6267 0.0878 0.0221 0.1039 0.0081 0.1834 0.9379 0.1258 0.5731 0.4753 2.20% 53 US Small Cap 1,151.14 5.06%–42.0% –42.0% ted to earlier this month by Mr. Raju, court awarded the police one more beenonthephonealmostconstantly —Timothy Martin in Chicago and U.S. ... 1.3827 0.8665 0.1215 0.0306 0.1436 0.0112 0.2535 1.2968 0.1740 0.7924 0.6573 4.00% 9 EM LATIN AMERICA 2,021.19 2.41%–54.1% –54.1% the company’s founder, even as Sa- day to interrogate B. Ramalinga Raju since news of the fraud broke. Betsy McKay in Atlanta Source: Thomson Reuters via WSJ Market Data Group *Twenty-three developed and 26 emerging markets Source: MSCI Barra tyam’s senior executives across the and Mr. Vadlamani. B. Rama Raju The company’s hundreds of rela- contributed to this article. 4 FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 THE WALL STREET JOURNAL. THE WALL STREET JOURNAL. FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 25 CORPORATE NEWS BLUE CHIPS & BONDS Below, a look at the Dow Jones Stoxx 50, the Dow Jones Industrial Average biggest and best known companies in Europe, P/E: 18 Major players & benchmarks including the U.K. LAST: 8122.80 t 105.30, or 1.28% Dow Jones Stoxx 50: Thursday’s best and worst… YEAR TO DATE: t 653.59, or 7.4% Sony forecasts first loss in 14 years OVER 52 WEEKS t 4,255.81, or 34.4% Market value, Previous in billions close, in STOCK PERFORMANCE High Company Country Industry of US$ local currency Previous session 52-week Three-year 12000 Consumer-electronics giant, struggling with low prices and strong yen, escalates plan for layoffs, factory closings Credit Suisse Grp Switzerland Banks $26.4 25.74 8.61% –56.8% –64.9% Close Soc. Generale France Banks 21.8 29.00 6.72 –59.1 –71.1 Low By Daisuke Wakabayashi Sony’s turf. The company didn’t offer too much old Sony and not enough 11000 further details of how it would new,” said Mr. Stringer at the news UBS Switzerland Banks 34.3 13.50 5.30 –67.9 –77.6 TOKYO—Sony Corp. said it would achieve the cost savings. conference Thursday. ING Groep Netherlands Life Insurance 14.8 5.51 4.36 –75.8 –81.1 report an annual loss for the first In many ways, Sony’s competi- Sony forecast an operating loss of Allianz SE Germany Full Line Insurance 36.8 62.83 4.16 –49.3 –51.8 50–day 10000 time in 14 years as plunging LCD tele- tion with Apple Inc. captures the chal- 260 billion yen, the company’s big- moving average vision prices and a strong yen are lenges facing the company. Apple gest to date, compared with a previ- Barclays U.K. Banks $6.8 0.59 –10.44% –87.6 –89.9 t came to dominate the market that So- 9000 forcing Chief Executive Howard ous estimate for an operating profit Nokia Finland Telecom Equipment 45.8 9.30 –9.09 –60.8 –37.5 Stringer to pursue his most drastic re- ny’s Walkman created not with hard- of 200 billion yen. UniCredit Italy Banks 21.8 1.26 –5.90 –75.3 –78.4 structuring measures to date, more ware brilliance or manufacturing Preliminary results for the fiscal than doubling the cost cuts that were prowess but with simple-to-use soft- third quarter ended Dec. 31 show Daimler Germany Automobiles 26.8 21.44 –5.61 –58.5 –54.2 8000 announced in December. ware and elegant design. On Wednes- sales fell 25% from a year earlier to 2.1 Anglo Amer U.K. General Mining 23.4 12.69 –3.50 –53.5 –41.0 Crippled by a global economic day Apple reported net profit rose trillion yen, while net profit fell 95% 7000 downturn and intensifying price com- 1.5% in the fiscal quarter ended to 10 billion yen. Historically, Sony ...And the rest of Europe’s blue chips petition, Sony said it now expects to Dec. 27. earns a larger portion of its full-year 24 31 7 14 21 28 5 12 19 26 2 9 16 Nov. Dec. Jan. post a net loss of 150 billion yen ($1.7 Apple relies on contract manufac- profit during the holiday quarter. Latest, Latest, turers for production and Market value, in local STOCK PERFORMANCE Market value, in local STOCK PERFORMANCE billion) in the fiscal year end- In the past three years, the Company/Country (Industry) in billions (U.S) currency Latest 52-week Three-year Company/Country (Industry) in billions (U.S) currency Latest 52-week Three-year Note: Price-to-earnings ratios are for trailing 12 months ing March 31, a reversal doesn’t have any factories 66-year-old Mr. Stringer has shed HSBC Hldgs 87.1 5.27 2.23% –32.5% –43.5% Bayer 41.7 42.12 –0.59% –23.2% 25.3% from a 150-billion-yen profit of its own. 10,000 jobs at the company, separate ress Sony’s Bravia TV U.K. (Banks) Germany (Specialty Chemicals) DJIA component stocks P

forecast that was made in Oc- By comparison, Sony d Rio Tinto 21.2 15.36 1.72 –66.0 –47.6 Roche Hldg Pt. Ct. 102.9 168.90 –0.65 –13.2 –13.6 e

from the 16,000 job cuts announced t line is shown Volume, CHANGE a

i U.K. (General Mining) Switzerland (Pharmaceuticals) tober. It also cut its sales has 57 electronics facto- in Tokyo Stock Symbol in millions Latest Points Percentage in December, mostly from Sony’s non- SAP 42.9 27.02 1.22 –13.6 –34.7 Unilever 39.6 17.83 –0.83 –18.5 –6.8 forecast by 14% to 7.7 trillion ries. Half of those facilities ssoc Japanese staff, and embarked on initi- A Germany (Software) Netherlands (Food Products) AT&T T 26.70 $25.51 –0.28 –1.09% yen. are in Japan where labor atives to cut costs and streamline op- ABB 28.6 14.19 1.21 –45.4 2.4 Banco Bilbao Vizcaya 31.4 6.46 –0.92 –54.5 –59.6 Alcoa AA 25.10 8.25 –0.31 –3.62% Mr. Stringer, who took costs can be high and a Switzerland (Industrial Machinery) Spain (Banks) erations. But while those efforts Challenging times AmExpress AXP 15.60 16.06 –0.81 –4.80% over in 2005 as the first non- strong yen can cripple Sony faces its first annual net loss in many years. Astrazeneca 55.6 27.80 1.16 25.4 3.9 BASF 27.1 22.78 –1.00 –46.1 –27.4 BankAm BAC 350.00 5.71 –0.97 –14.52% were starting to pay off with im- U.K. (Pharmaceuticals) Germany (Commodity Chemicals) Japanese executive leading profit margins when funds Boeing BA 6.20 42.26 –0.01 –0.02% proved profitability, Sony was hit BP 139.2 4.90 0.82 –7.8 –25.2 Diageo 34.7 9.15 –1.13 –9.6 8.6 the electronics and enter- from products sold over- Howard Stringer becomes CEO Caterpillar CAT 18.20 37.23 –2.32 –5.87% with a double whammy of a severe t U.K. (Integrated Oil & Gas) U.K. (Distillers & Vintners) tainment conglomerate, seas are repatriated into ¥15,000 ¥400billion Chevron CVX 13.40 69.95 –1.28 –1.80% economic slowdown in its key mar- British Amer Tob 50.6 18.19 0.50 4.7 44.4 Sanofi-Aventis 79.8 46.81 –1.28 –16.9 –37.6 said Sony has to accelerate Howard Stringer yen. More than 80% of So- t U.K. (Tobacco) France (Pharmaceuticals) Citigroup C 283.60 3.11 –0.56 –15.26% kets and a strong yen. Share price (left axis) Net profit/loss ny’s electronics are sold ENI 84.6 16.29 0.49 –25.5 –32.6 GDF Suez 85.4 30.08 –1.31 –16.7 15.2 CocaCola KO 10.10 43.12 –0.17 –0.39% its restructuring plans with (right axis) t Now, Mr. Stringer is pushing to Italy (Integrated Oil & Gas) France (Multiutilities) a sense of urgency to reduce fixed overseas. Earlier in the week, the yen 10,000 200 Disney DIS 14.70 20.97 –0.26 –1.22% make the deep and painful cuts in Ja- L.M. Ericsson Tel B 22.7 62.80 0.32 –8.9 –52.8 Telefonica 88.8 14.56 –1.42 –26.8 16.7 costs that are too bloated and a sup- hit a new 13-year high against the DuPont DD 8.30 23.92 –0.56 –2.29% pan that he hasn’t made in earlier re- Sweden (Telecom Equipment) Spain (Fixed Line Telecom) ply chain that is too slow. U.S. dollar at 87.10. GlaxoSmithKline 97.5 12.41 0.28 2.1 –13.8 Assicurazioni Genli 30.4 16.64 –1.48 –43.1 –35.8 ExxonMobil XOM 38.10 78.23 –1.03 –1.30% structuring plans, using the eco- Last month, Sony said it would What’s more, many Japanese com- 5,000 0 U.K. (Pharmaceuticals) Italy (Full Line Insurance) GenElec GE 145.30 13.48 0.45 3.45% panies consider it a social responsi- nomic downturn as the necessary cat- Deutsche Bk 13.1 17.69 0.26 –77.5 –79.2 Deutsche Telekom 57.2 10.13 –1.89 –24.8 –22.5 GenMotor GM 8.60 3.32 –0.21 –5.95% cut 16,000 jobs from its electronics di- Germany (Banks) Germany (Mobile Telecom) alyst to take more drastic measures, HewlettPk HPQ 20.00 35.49 0.38 1.08% visions and close as many as six facto- bility to care for their workers and Intesa Sanpaolo 33.2 2.17 0.23 –54.2 –53.0 Total 108.7 35.37 –2.09 –29.2 –35.0 HomeDpt HD 21.20 21.97 –0.31 –1.39% prefer to make cutting full-time jobs according to a person familiar with 0 —200 Italy (Banks) France (Integrated Oil & Gas) ries in an attempt to save more than Intel INTC 67.40 12.82 –0.44 –3.32% at home a last resort. A third of So- the matter. FY’01 FY’02 FY’03 FY’04 FY’05 FY’06 FY’07 FY’08 FY’09 Iberdrola 38.9 6.01 0.17 –33.9 3.8 ArcelorMittal 32.0 17.05 –2.10 –60.4 ... 100 billion yen in annual costs. Forecast ny’s 180,000 full-time employees are Still, Mr. Stringer faces plenty of Spain (Conventional Electricity) Luxembourg (Iron & Steel) IBM IBM 11.60 90.07 –1.35 –1.48% Now, it plans to expand the lay- Note: Fiscal years end March 31 of year shown based in Japan. challenges. Analysts said the lack of Novartis 119.2 52.00 0.10 –7.1 –26.0 E.ON 62.7 24.16 –2.19 –43.0 –14.8 JPMorgChas JPM 104.10 23.10 0.47 2.08% offs to other Sony businesses includ- Sources: the company (net profit/loss), Thomson Reuters Datastream (share price) Switzerland (Pharmaceuticals) Germany (Multiutilities) JohnsJohns JNJ 17.30 56.87 0.51 0.90% A senior executive at Sony said detail about Sony’s restructuring ef- ing its entertainment and videogame Royal Dutch Shell 82.2 17.88 –0.14 –27.4 –33.3 AXA 33.1 12.22 –2.28 –49.7 –55.4 KftFoods KFT 15.40 28.91 0.58 2.05% Mr. Stringer’s effort to close produc- forts raises questions about whether U.K. (Integrated Oil & Gas) France (Full Line Insurance) McDonalds MCD 9.70 58.72 0.02 0.03% arm and slash spending across the the company’s plans are sufficient to its fiscal year ending March 31, 1995, other high-ranking employees will BHP Billiton 35.6 11.62 –0.26 –16.2 11.8 Siemens 51.5 43.43 –2.29 –48.5 –42.9 tion facilities in Japan has raised ten- Merck MRK 13.70 27.45 –0.12 –0.44% board to shave an additional 150 bil- garner long-term profit improve- when the company was forced to take cuts in salary and bonus. U.K. (General Mining) Germany (Diversified Industrials) sions with long-entrenched execu- Microsoft MSFT 211.30 17.11 –2.27 –11.71% lion yen in costs. ments. France Telecom 64.2 18.96 –0.29 –18.3 –0.7 Royal Bk of Scot 6.6 0.12 –2.40 –96.4 –97.5 tives. Closing a Japanese factory write down its investment in Colum- To achieve the 16,000 headcount France (Fixed Line Telecom) U.K. (Banks) Pfizer PFE 42.20 17.21 –0.27 –1.54% Sony didn’t specify the number of making television sets—the flagship The company tripled its forecast bia Pictures. A loss in this fiscal year reductions announced in December, Tesco 37.8 3.50 –0.40 –18.6 9.8 BNP Paribas 27.4 23.20 –3.11 –65.8 –67.4 ProctGamb PG 16.80 56.96 –0.61 –1.06% new layoffs, but said it plans to close U.K. (Food Retailers & Wholesalers) France (Banks) product of Sony’s electronics lineup— for restructuring charges for this fis- would mark the company’s second the company plans to introduce an 3M MMM 4.50 54.06 –0.18 –0.33% a television factory in Japan by June cal year ending in March to 60 billion net loss since it started reporting Nestle 134.3 40.44 –0.49 –14.3 6.4 Vodafone Grp 102.9 1.29 –3.24 –25.1 6.1 shows that Mr. Stringer wants to early-retirement program for em- Switzerland (Food Products) U.K. (Mobile Telecom) UnitedTech UTX 7.40 48.95 –0.30 –0.61% and it will outsource more produc- make no exceptions in effort to re- yen and said it would incur an addi- earnings in 1961. ployees, and the closure of the Japa- Banco Santander 55.5 5.36 –0.56 –52.1 –49.8 Koninklijke Philips 16.6 12.70 –3.46 –51.0 –54.0 Verizon VZ 16.40 30.16 –0.74 –2.39% tion of lower-cost products to con- vive the company. tional 110 billion yen in restructuring Sony’s three top executives in- nese television factory will result in Spain (Banks) Netherlands (Consumer Electronics) WalMart WMT 29.40 48.87 –0.27 –0.55% tract manufacturers, a strategy used “Our own historical legacies charges next year. cluding Mr. Stringer will forgo a bo- 1,000 job cuts for temporary work- Sources: Dow Jones Indexes; WSJ Market Data Group Source: WSJ Market Data Group by new competitors encroaching on sometimes restrain us. There is still Sony last posted a full-year loss in nus for the current fiscal year, while ers.

Hedge funds Credit-default swaps: European companies Tracking Dow Jones TOTAL RETURN for rolling periods, net of fees* At its most basic, the pricing of credit-default swaps measures how much a buyer has to pay to purchase-and Nokia’s net skids 69% in quarter Autonomy grabs Interwoven Hedge Benchmark One week One month One quarter Year to date One year how much a seller demands to sell-protection from default on an issuer's debt. The snapshot below gives a Merger Arbitrage 0.30% 1.24% 3.1% 1.5% -3.7% By Gustav Sandstrom pectations for a 5% drop, with the de- sense which way the market was moving yesterday. Event Driven 0.93% 2.31% -10.1% 1.8% -23.9% cline greater in the first half than in credit Another fall to expand in legal software Distressed Securities -1.70% -3.13% -20.4% -3.4% -36.9% Nokia Corp. posted a worse-than- the second half. Nokia’s net profit, in billions *Estimates as of 01/21/09, after fees; Source: www.djhedgefundindexes.com Showing the biggest improvement... And the most deterioration expected 69% drop in fourth-quarter The company is feeling the pres- By Steve McGrath ing price on the Nasdaq Stock Mar- Œ3 markets & net profit Thursday and said the mar- sure of the weakening economy to a ket. Autonomy shares rose 3.8%, or CHANGE, in basis points CHANGE, in basis points ket would contract further in 2009 LONDON—Autonomy Corp. said 39 pence, to £10.72 ($15) in London Yesterday Yesterday Five-day 28-day Yesterday Yesterday Five-day 28-day greater extent than expected, said Unibail Rodamco 483 –46 –42 –98 Corus Group "1,316" 39 140 181 than previously forecast. Thursday it agreed to acquire soft- Thursday. Gartner Inc. research director Caro- dealmakers Gecina 1381 –42 22 –234 Contl AG 975 57 –135 –308 The economic downturn has led ware firm Interwoven Inc. for $775 Autonomy said it will place 2 lina Milanesi. Still, “Nokia is best Credit derivatives TelefonAB L M Ericsson 340 –15 –10 –84 Enel 631 60 110 50 to a rapid decline in consumer de- million, boosting its presence in the about 21.6 million shares, or 9.99% placed to deal with the current mar- Kdom Spain 148 –6 30 50 Endesa 599 61 114 46 mand for electronic goods, and U.S. and gaining access to the grow- of its existing share capital, seeking Spreads on credit derivatives are one way the market rates ket conditions thanks to its econo- Kdom Denmark 115 –5 14 –1 Glencore Intl "1,388" 79 149 –919 Nokia, the world’s biggest mobile- ing legal software market. to raise about £220 million ($307.6 creditworthiness. Regions that are treading in rough waters can mies of scale, distribution channel Transocean 325 –4 –9 –15 TUI AG "1,259" 82 243 226 phone maker, said the outlook for this 1 The U.K. information-retrieval million) to help fund the deal. The see spreads swing toward the maximum—and vice versa. Indexes and portfolio that meets different Hellenic Rep 291 –4 42 58 Rhodia "1,439" 87 248 199 year had deteriorated further since it software company’s product helps balance will come from a new revolv- below are for five-year swaps. price points,” she said. L Air Liquide Sa Pour L Etude Et L Exploitation85 –4 –4 –26 ArcelorMittal Fin "1,152" 91 62 –372 issued a profit warning in December. companies keep track of their email, ing credit facility with Barclays PLC The company said its market Markit iTraxx Indexes SPREAD RANGE, in pct. pts. Carrefour 76 –3 –1 –26 Thomson "1,808" 93 124 –257 Nokia shares fell 9% in Stockholm phone calls and documents, and it and cash reserves. Mid-spread, since most recent roll 0 share fell to 37% in the fourth quarter Marks & Spencer 439 –3 0 –16 Seat Pagine Gialle "1,479" 115 165 –77 trading Thursday. 2007 ’08 has seen demand surge as the regula- Seymour Pierce analyst Derek Index: series/version in pct. pts. Mid-price Coupon Maximum Minimum Average from 38% in the third quarter. Among Europe: 10/1 1.72 97.69% 0.01% 2.17 1.18 1.63 Source: Markit Group Net profit for the three months tory burden on companies has Brown called the deal a master- Source: the company other challenges, Nokia is battling Ap- Eur. High Volatility:10/1 4.05 92.55 0.02 5.57 2.16 3.72 ended Dec. 31 fell to Œ576 million grown, notably in the U.S. The acqui- stroke. “Autonomy is buying the one- ple Europe Crossover:10/1 10.57 84.21 0.06 11.20 5.74 8.77 US: Bank revenues from equity capital markets ($749.8 million) from Œ1.84 billion in Inc.’s iPhone in the smart-phone sition of Interwoven, founded in time leader in the content-manage- Asia ex-Japan IG: the year-earlier period. Earnings per as amortization after last year’s $8.1 segment. Apple said Wednesday it 1995, will boost Autonomy’s pres- ment space, expanding its customer 10/1 3.41 94.11 0.02 6.63 1.99 3.58 Behind every IPO, n n billion acquisition of digital map- sold 4.4 million iPhones in its fiscal base by some 3,000, and enabling Japan: 10/1 3.07 93.16 0.02 3.75 1.58 2.65 Equity capital markets Debt capital markets (both in billions, left axis) sharefellto15Europeancentsfrom47 ence in the U.S. and give it access to follow-on or maker Navteq. first quarter, 88% more than a year dominance of the legal arena at a Note: Data as of January 21 cents. a growing market, particularly soft- convertible equity earlier. time when the market is set to boom 6 60% Sales declined 19% to Œ12.66 bil- “The macroeconomic environ- ware for law firms. WSJ.com In percentage points offering is one or ECM as a percentage of total Analysts had expected Nokia to through increased regulation Spreads (right axis) lion from Œ15.72 billion. The average ment has deteriorated rapidly, with Interwoven’s software helps em- more investment post a weak result after the company across all industry verticals,” Mr. Spreads on five- 4.00 t selling price for the company’s even weaker consumer confidence, ployees manage Web content and le- Follow the markets throughout Index roll banks. At right, warned twice during the fourth quar- Brown said. year swaps for 4 40 phones declined to Œ71 in the fourth unprecedented currency volatility gal documents, and its customers in- the day, with updated stock 3.00 investment banks ter that it was being hit by slower con- Cambridge, England-based Au- corporate debt; quarter, down from Œ83 a year earlier and credit tightness continuing to im- clude the world’s top law firms, gov- quotes, news and commentary historical and year-

sumer spending. Friday, rival hand- tonomy said it expects the acquisi- based on Markit Australia 2.00 and Œ72 in the third quarter. pact the mobile communications in- ernments and companies such as at WSJ.com/Europe. t t to-date revenues set maker Sony Ericsson warned of Fedex HSBC Hold- tion to add to earnings in the first iTraxx indexes. 2 20 Nokia’s operating margin slipped dustry,” said Chief Executive Olli-Pe- Airbus, Corp., Also, receive email alerts that Japan 1.00 from global equity- further market weakness as it posted ings Royal Dutch Shell full quarter after completion, which to 3.9% from 15.9%, in part because of kka Kallasvuo. PLC, PLC summarize the day’s trading in capital-market Microsoft it expects in the second quarter of 0 restructuring charges of Œ747 million Nokia said it now expects 2009 a second straight quarterly loss. Sony and Corp. Europe and Asia. (ECM) deals relating to Nokia Siemens Networks, mobile-device volumes for the indus- Ericsson is the handset joint venture Interwoven shareholders will this year. If the deal closes on time, To sign up, go to Aug. Sept. Oct. Nov. Dec. Jan. 0 0 2009 2003 2004 2005 2006 2007 2008 the company’s network-equipment try as a whole to decline about 10% of Japan’s Sony Corp. and Sweden’s get $16.20 for each share, a 37% pre- it expects to have a cash balance of WSJ.com/Online Today jointventurewithSiemensAG,aswell from 2008, down from previous ex- Telefon AB L.M. Ericsson. mium to Wednesday’s $11.84 clos- at least $75 million afterward. Source: Markit Group Source: Dealogic 24 FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 THE WALL STREET JOURNAL. THE WALL STREET JOURNAL. FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 5 CORPORATE NEWS www.efinancialnews.com Lockheed offers Hiring spree continues Microsoft to eliminate 5,000 jobs bullish outlook, Extras boost LSE revenue Quarterly profit dips posts solid profit for Standard Chartered as global downturn By August Cole Posttrade services, Trade off Lockheed Martin Corp. re- By Liam Vaughan Wheeler was named head of whole- erodes PC demand The London Stock Exchange Group's revenue has been supported by a strong ported its strongest annual profit sale banking in the West. He works a strong euro offset ever and gave a bullish outlook for euro and new services it has rolled out. But its core exchange business has Standard Chartered PLC has ap- alongside Olga Zoutendijk, who was By Nick Wingfield this year, signaling that the defense been suffering from a decline in the value of trades. pointed a former ABN Amro execu- appointed to the equivalent role for hit to equity trading industry may be one of the few sec- tive as global head of project and ex- the East in May 2007. Revenue* Stock performance Microsoft Corp. finally suc- tors able to buck the U.S. recession. Chief of wholesale banking is By Luke Jeffs Lockheed, the Pentagon's big- port finance, the latest senior whole- In millions Thursday’s close: 492.5 pence cumbed to the deteriorating global sale banking hire at the Asia-fo- Mike Rees, while Gareth Bullock is economy, announcing lower profit gest contractor by sales, reported cused bank in recent months. group executive director for the Mid- A strong euro and a new focus on £200 £20 and job cuts in the latest sign that revenue of $11.13 billion in the James Courtenay was global dle East, Africa, Europe and the posttrade services helped push the companies dependent on commod- fourth quarter, up 3% from a year earlier. Net earnings were $823 mil- head of leveraged and real estate fi- Americas. London Stock Exchange Group 150 15 ity-style businesses such as personal nance with Dutch bank ABN Amro, The U.K.-listed bank also made a PLC’s revenue up 4% in its fiscal computers are hurting the worst. lion, or $2.05 a share, an increase which was taken over by Royal Bank string of high-profile appointments third quarter. The Redmond, Wash., software from $799 million, or $1.89 a share. of Scotland Group PLC last year. toward the end of last year, tapping But its equity-trading business 100 10 company posted an 11% decline in net For the year, sales rose 2% to Prior to ABN Amro, he headed the in- personnel from its struggling com- was hit by falling markets, highlight- income for its fiscal second quarter $42.73 billion, while net income vestment banking and leveraged fi- petitors. ing the problems Europe’s behe- 50 5 and announced plans to cut as many climbed to $3.22 billion, or $7.86 a nance businesses for CIBC in Europe. Christian Wait, a former Lehman moth exchanges and their fledgling as 5,000 jobs, an unprecedented num- share, from $3.03 billion, or $7.10a share. Mr. Courtenay succeeds Anil credit banker, was made global head rivals face. ber of layoffs in Microsoft’s more 0 0 For this year, the company pro- Dua, who is now Standard Char- of capital markets in October, along- The LSE, which like its competi- 4Q3Q2Q1Q 3Q2Q1Q than three decades in business. Mi- 2008 '09 jected revenue between $44.7 bil- tered’s head of origination and cli- side Arun Murphy, the new global tors charges fees based on the value 2008 '09 crosoft Chief Executive Steve Ball- head of energy, and commodities of trading, gave some indication of mer, in an email to company employ- Press Associated lion and $45.7 billion and profit of ent coverage for Africa. * traders Michael Slater and Abhinav the effects the economic slowdown Fiscal year ends March 31 Sources: the company; Thomson Reuters Datastream ees, described the current economic Steve Ballmer, who Thursday called the current recession the worst “in two generations,” speaks earlier this month in Las Vegas. $4.16 billion, or $7.05 a share, to Standard Chartered has made a Jain. is having on trade. It reported Thurs- environment as the “worst recession $4.26 billion, or $7.25 a share. The series of appointments in the whole- day a 13% fall in trading revenue for helped boost revenue from its Ital- it is business that the trading facili- in two generations.” new outlook for revenue was higher sale banking division in recent Standard Chartered has re- the last three months of 2008 com- ian businesses during the quarter. ties have taken away from the estab- The news from Microsoft came sales of its Macintosh computers companies cut costs by building en- share, down 11.5% from $4.71 billion, than the forecast Lockheed gave in months. mained relatively healthy amid the global credit crunch. pared with the same period a year Last year was also the first time lished exchanges. the same day cellphone giant Nokia and iPhones powered a 5.8% rise in ergy-efficient data centers and vir- or 50 cents a share, a year earlier. Rev- October. But the profit forecast was In October, former Goldman Earlier this month, its existing in- before, which was related to a 38% the LSE and its European peers The trading facilities have Corp. reported a 46% dive in earn- revenue and a 1.5% gain in profit. tualizing servers so many applica- enue rose 1.6% to $16.63 billion. lower because of higher pension ex- Sachs Group Inc. partner Peter vestors took up 96.95% of the bank’s fall in the total value of its trades. NYSE Euronext and Deutsche Börse brought in new customers, allowing ings and Sony Corp., the biggest Both products have exploited attrac- tions run on a single box. The job cuts, which make up penses driven by tumbling interest £1.8 billion ($2.52 billion) share The exchange said its core equity- AG were confronted with real trad- the emergence of ultrafast U.S. sta- name in the consumer-electronics tive designs to perform relatively Pip Coburn, president of Coburn more than 5% of Microsoft’s rates and weak equity returns. — NOTICE TO READERS — rights issue. Standard Chartered said trading business was mainly hit by ing competition. tistical-arbitrage brokers whose sector, warned of a $2.9 billion oper- well during the downturn. Ventures, a New York-based hedge 96,000-person work force, include The Bethesda, Md., company is The articles on this page on the in November that it was raising capi- the 34% fall in the average value of New multilateral trading facili- trading strategies couldn’t be effec- ating loss. Meanwhile, International Busi- fund focused on technology, said it 1,400 people to be laid off Thursday. the first of several large defense securities and investment-banking tal to meet investor expectations for the FTSE 100 index and the 47% ties such as Chi-X and Turquoise tive in Europe when there was only Another bellwether of the PC ness Machines Corp. recently re- is far easier in this economic cli- In total, the cuts are expected to contractors, including Raytheon industry are provided by Financial higher capital and to expand. drop in the Italian MIB index. The have grown steadily and now handle one place to trade a stock. business, chip maker Intel Corp., ported strong financial results and an mate for businesses to defer spend- save Microsoft $1.5 billion a year. Corp., General Dynamics Corp. and Northrop Grumman News, a Dow Jones company in Unlike share sales by other LSE runs London’s exchange as well as much as a quarter of trading on The LSE has been trying to diver- Wednesday said it will close several upbeat outlook, thanks in large part ing on new computers for workers In an interview, Microsoft Chief Corp., slated London that publishes the banks this year, this one was never as Italy’s Borsa Italiana, which it the main U.K., French, Dutch and sify its business into new areas, factories, displacing 5,000 to 6,000 to a shift over the past several years than it is for them to resist pitches Financial Officer Chris Liddell said to report earnings in the next few Financial News Web site (www.efi- in doubt. Standard Chartered hasn’t bought in October 2007. German indexes. such as posttrade processing, a busi- workers, while rival chip maker Ad- out of commodity hardware products to cut technology spending through the company is bullish that the PC weeks and its bullish outlook bodes nancialnews.com) and Financial been marred by rumors or a share The LSE said the strength of the The rising share of trades ness unit that posted a 60% increase vanced Micro Devices Inc. recently into corporate software and services. outsourcing deals. market will again be a growth busi- well for the rest of the sector. Defense companies’ ride their News weekly newspaper. selloff. euro against the British pound doesn’t necessarily mean that all of in revenue for the last quarter. said it plans to slash 1,100 jobs. Services is a bright spot in the in- “PCs are not do-more-with-less,” ness. “In the short term, we’re very Yet the pain isn’t being shared dustry, because many troubled com- said Mr. Coburn, whose fund holds conservative,” he said. “Over the me- own ups and downs, but are af- equally in high tech, as some compa- panies are concluding they can cut shares in Accenture. “They’re just a dium- to longer-term, there are still fected more by national security nies benefit from healthy niches or costs by outsourcing operations to tax and one that you can push out.” five billion people without a PC.” and government spending than mar- use strong competitive positions to companies like IBM and Accenture For its fiscal second quarter —William M. Bulkeley, ket turbulence. Many of these com- expand their market share. On Ltd., which reported strong results ended Dec. 31, Microsoft reported net Don Clark and Justin Scheck panies are benefiting from the dra- Chi-X now handling trades matic expansion of military spend- Wednesday, Apple Inc. said strong in December. Services can also help income of $4.17 billion, or 47 cents a contributed to this article. ing during the eight years George W. Bush’s presidency. While the Pen- on Spain’s blue-chip index tagon budget’s growth rate is ex- By Luke Jeffs Chi-X Europe handles 14% of pected to contract under President Barack Obama, many defense com- Algorithms in Trading Introduction to Excel Modelling trading in U.K. FTSE 100 stocks in & Investing for Financial Markets GM sales fall 11%, putting Toyota in top spot panies have built sizable order back- Chi-X Europe began operations value terms. In less than two years, logs, enabling them to ride out the in the last big European market un- it has won market shares of more By Sharon Terlep into recession, declined 6.5% to (See article on page 17.) plants for the month to get invento- 10 - 11 February 2009, London 15 - 17 February 2009, Dubai current economic downturn. touched by the rise of new high- 2.04 million. Slumping sales contributed to ries in line with anemic demand. than 10% in the main Dutch, French Lockheed Chief Financial Of- tech exchanges Thursday when it General Motors Corp. reported Former hot spots in emerging GM’s financial crisis, which led the Conditions in Western Europe and German indexes. ficer Bruce Tanner said the compa- started letting customers trade all an 11% drop in 2008 vehicle sales, re- markets showed slowing demand, auto maker to seek $13.4 billion in are likely to remain challenging, Mr. Volatility as an Asset Class Equity Derivatives The Spanish stock market is the ny’s four divisions worked hard the stocks that compose the main linquishing its crown as the world’s with GM sales rising 2.7% in the federal assistance at the end of last DiGiovanni said, as nations struggle fourth-largest in Europe, according last year to build up their back- Spanish stock index. biggest auto maker to Toyota Mo- Asian-Pacific region and 3.2% in year to avoid a bankruptcy filing. with a housing crisis similar to the 23 - 24 February 2009, New York 26 - 27 February 2009, London to the Federation of European Stock logs, now a record $80.9 billion tor Latin America, Africa and the Mid- GM sales analyst Mike DiGio- one in the U.S. He said developing Chi-X Europe, which is majority- Exchanges, a trade group. The mar- Co. after 77 years. combined. “We felt it was very im- Nomura Holdings GM, which is struggling to stay dle East. Still, Russia recorded 30% vanni said industrywide sales in the markets that until recently boasted owned by Inc.’s ket capitalization of companies portant given the change of admin- agency broker Instinet, began han- afloat with loans from the U.S. gov- growth while Brazil gained 10% and U.S. will likely come in at a season- rapid growth are expected to notch listed at the BME is Œ680 billion istration,” Mr. Tanner said in an in- dling trading in all the stocks in ernment, said it sold 8.35 million India rose 9%. GM sales in China in- ally adjusted rate of about 10 mil- modest sales growth. Leveraged Finance Excel Modelling for Financial ($885 billion) and the value of trad- terview. the IBEX 35, Spain’s blue-chip vehicles world-wide last year. Ja- creased 6%. lion vehicles in January, similar to The auto maker has played down Markets ing on that exchange last year was Lockheed has also tried to diver- 25 - 26 February 2009, London stock index. Agency brokers are pan-based Toyota has said it sold International sales rose to 64% the multidecade lows seen toward its sales competition with Toyota. Œ1.65 trillion. Both figures amount sify its business beyond defense those that only handle business for 8.97 million vehicles, off 4% from a of GM’s total, from 59% in 2007. the end of last year. He attributed “They passed us in market cap, prof- 25 - 26 February 2009, London to about 11% of the European total. contracts. Chief Executive Robert clients, without trading on their year earlier. The company predicted auto the weakness in part to factory shut- itability and cash flow a long time Stevens steered the company into European exchanges and trad- own accounts. Last year’s declines at GM were markets will remain bleak through downs that have curtailed auto mak- ago,” GM Chief Operating Officer national-security work, well be- ing systems such as Chi-X Europe Advanced Valuation of Carbon Emissions Trading Before Chi-X Europe entered the led by a 21% skid in North America the first quarter and said it is count- ers’ ability to meet demand from Fritz Henderson said Tuesday. yond its traditional strength in Debt & Equity Modelling market, the Spanish exchange giant are facing a slowdown in trading to 3.56 million vehicles. Sales in Eu- ing on government stimulus around rental-car companies. GM and other Toyota officials, likewise, didn’t aerospace engineering and mili- 5 - 6 March, London Bolsas y Mercados Españoles han- revenue. Plummeting share prices rope, which like the U.S. has fallen the globe to help reverse things. major auto makers idled many make much of the lead change. tary aircraft. 3 - 4 March 2009, London dled all trades in the IBEX 35 stocks. and the withdrawal of hedge funds Lockheed’s information-sys- Chi-X says it will let clients trade amid the credit crisis have cut the tems and global-services division more cheaply than on the main ex- value of trading on these markets, brought in the most fourth-quarter Islamic Finance Products Excel Modelling for Financial change, but didn’t offer details. the basis for their fee revenue. revenue, at $3.3 billion. The group’s & Strategies Statements Hyundai Motor’s profit falls 28% amid downturn broad responsibilities range from supporting peacekeeping opera- 5 - 6 March, London 9 10 March, Stockholm By Kyong-Ae Choi customers amid the economic cri- first quarter, the results for the pe- months ended Dec. 31 was 74.8 bil- tions in Africa to working with the sis,” said Park Dong-wook, Hyun- riod will reflect sharp declines in op- lion won up from 37.9 billion won a U.S. intelligence community. Abraaj beefs up leadership SEOUL—Hyundai Motor Co., dai’s senior vice president. erating profit and sales. year earlier, largely on strong do- In a sign of how the defense in- UCITS III Investment Excel Modelling for South Korea’s largest car maker by Hyundai’s net profit for the three “If each government’s stimulus mestic sales of new and remodeled dustry isn’t wholly insulated from Strategies & Products Financial Statements By Jennifer Bollen There have been a slew of ap- sales, said fourth-quarter net profit months ended Dec. 31 fell to 243.6 bil- package helps ease auto finance vehicles. Quarterly operating profit the current markets crisis, how- pointments in the Middle East, in declined 28% as the weaker won lion won from 338.0 billion won a year credit, sales of low-priced small cars fell 63% to 35.9 billion won from 97.7 ever, Northrop Grumman said 9 - 10 March 2009, London 16 - 17 March 2009, Frankfurt Middle Eastern private-equity contrast to the layoffs at European failed to cushion the impact of the earlier. T.H. Chung, the company’s se- may increase from the second quar- billion won, while sales were up Thursday that it will take a write- firm Abraaj Capital appointed two and U.S.-focused firms. global economic downturn. nior executive vice president, said the ter, helped by a weak won,” Song 7.4% to 5.041 trillion won. down of $3 billion to $3.4 billion executive directors to push through Mr. Rajagopalan has been pro- The company postponed a $600 company expects the business envi- Sang-hoon at Kyobo Securities said. Kia will proceed with a plan to for its shipbuilding and space busi- For more information on these and our other training courses please an investment drive for the largest moted from senior vice president to million investment to start produc- ronment to remain tough this year. By contrast, Kia Motors Corp., start production of two to three nesses. That will result in a net loss fund being put together by an inde- focus on financial management and tion at its Sao Paulo, Brazil, plant in Operating profit declined 8.9% which is 39% owned by Hyundai, models at its plant in the U.S. state for the fourth quarter, the Los An- contact Tracey Huggett on tel: +44(0)20 7749 0230 or email: pendent group in the region. control of portfolio companies. He the first half of 2011. It also will ad- to 581 billion won from a revised said its fourth-quarter net profit al- of Georgia starting in December this geles company said, explaining thuggett@efinancialnews.com Abraaj, which targets busi- joined Abraaj in 2005. just its plan to build a 540 billion 637.8 billion won a year earlier, most doubled due to the weaker year as planned. Despite worsening that the charge was "primarily nesses in the Middle East, North Af- Mr. Badreldin joined Abraaj from won ($394.2 million) plant in Russia while sales rose 1.1% to 8.831 trillion won and new car models. The U.S. market conditions, Kia said it will driven by adverse equity-market rica and South Asia, has hired Barclays Capital, where he worked by January 2011. won. dollar rose 48% over the year to an further strengthen its lineup by conditions that caused a decrease Ahmed Badreldin and promoted as senior director of leveraged fi- “The fourth-quarter results are Analysts said given Hyundai’s average 1,364 against the won in the launching four new models, in- in current market multiples and Narayanan Rajagopalan to execu- nance in London. He will focus on as bad as it gets, given auto finance planned year-to-year output reduc- fourth quarter. crease production of small cars and the company’s stock price as of tive director. making and completing deals. credit was not available for many tion of between 25% and 30% in the Kia’s net profit for the three keep inventory low this year. Nov. 30, 2008." 6 FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 THE WALL STREET JOURNAL. THE WALL STREET JOURNAL. FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 23 CORPORATE NEWS Advertisement [ INTERNATIONAL INVESTMENT FUNDS www.WSJ.com ] Advertisement Continued from previous page 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 NAV — %RETURN — FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR n POLAR CAPITAL PARTNERS LIMITED n SEB Fund 3 Bonds US OppsCoreplus A OT OT LUX 01/20 USD 32.33 2.5 0.8 4.5 International Fund Managers (Ireland) Limited PH - 353 1 670 660 Fax - 353 1 670Choice 1185 North America Eq. Fd US EQ LUX 01/22 USD 1.32 –5.0 –36.5 –24.8 Bonds World A OT OT LUX 01/20 USD 38.46 –3.4 0.4 7.5 Asia Ex-Japan Fund USD AS EQ IRL 05/20 USD 1.12 –93.7 –93.8 –72.2 Ethical Global Fd GL EQ LUX 01/22 USD 0.55 –10.7 –40.9 –27.4 Eq. China A OT OT LUX 01/21 USD 13.18 –11.8 –52.5 –19.0 Global Technology OT EQ IRL 01/21 USD 7.42 –5.4 –39.2 –27.1 Ethical Sweden Fd NO EQ LUX 01/22 SEK 26.26 –8.6 –32.7 –24.6 Eq. ConcentratedEuropeA OT OT LUX 01/21 EUR 18.72 –9.1 –44.7 –33.0 Japan Fund USD JP EQ IRL 01/22 USD 14.08 –4.2 –2.5 –12.3 Europe Fd EU EQ LUX 01/22 USD 1.42 –7.6 –39.7 –27.8 Eq. Eastern Europe A OT OT LUX 01/21 EUR 12.35 –6.6 –67.1 –42.5 Retailers continue to expand in China Index Linked Bd Fd SEK OT BD LUX 01/22 SEK 12.97 –0.8 1.3 4.0 Eq. Equities Global Energy OT OT LUX 01/21 USD 13.51 –5.2 –36.0 –12.2 n Hemisphere Management (Ireland) Limited Medical Fd OT EQ LUX 01/22 USD 2.78 –3.1 –22.9 –13.4 Eq. Euroland A OT OT LUX 01/21 EUR 8.33 –9.2 –42.1 –30.6 n Tesco stores in Shandong province Aeon Co., meanwhile, said it would MP ASSET MANAGEMENT INC. Columbus USD A OT OT CYM 10/31 USD 89.67 –11.1 –13.2 NS Short Medium Bd Fd SEK NO MM LUX 01/22 SEK 9.18 0.2 3.0 3.0 Eq. Euroland MidCapA EU EQ LUX 01/21 EUR 13.65 –5.3 –42.1 –34.2 Tel: + 386 1 587 47 77 Discovery USD A OT OT CYM 12/31 USD 126.59 10.8 12.5 12.2 Technology Fd OT EQ LUX 01/22 USD 1.51 –3.2 –35.6 –21.1 Eq. EurolandCyclclsA OT OT LUX 01/21 EUR 12.80 –6.8 –39.0 –23.6 Carrefour, Tesco see in eastern China and Fujian province delay a target of opening 100 stores MP-BALKAN.SI OT OT SVN 01/21 EUR 24.85 –5.3 –64.5 –39.5 Elbrus USD A GL EQ CYM 12/31 USD 6.75 –58.8 –58.8 –25.1 World Fd NO BA LUX 01/22 USD 1.49 –9.9 –37.6 –18.9 Eq. EurolandFinancialA OT OT LUX 01/21 EUR 6.95 –17.5 –54.7 –42.9 Europn Conviction USD B EU EQ CYM 12/31 USD 126.28 10.6 10.6 8.6 Eq. Glbl Emg Cty A OT OT LUX 01/21 USD 5.36 –10.3 –55.3 –26.0 in the southeast. Tesco also plans to in China by two years, until Feb. MP-TURKEY.SI OT OT SVN 01/21 EUR 18.28 –6.4 –59.7 –33.7 n SEB Fund 4 Europn Forager USD B OT OT CYM 12/31 USD 178.94 –12.8 –12.8 –0.8 Eq. Global A OT OT LUX 01/21 USD 19.63 –6.7 –41.0 –26.4 good long-term bet Short Bond Fd EUR EU MM LUX 01/22 EUR 1.27 0.1 1.9 2.2 expand its store network in the north- 2013. Aeon made the decision after n PAREX ASSET MANAGEMENT IPAS Gl Utilities Abs Rtn USD A OT OT CYM 08/29 USD 100.13 –16.6 –10.7 –1.9 Eq. Global Technol A OT OT LUX 01/21 USD 3.55 –2.9 –41.4 –28.9 Short Bond Fd SEK NO MM LUX 01/22 SEK 21.63 0.3 2.8 2.9 Eq. Gold Mines A OT OT LUX 01/21 USD 19.51 –6.7 –34.3 –11.6 eastern province of Liaoning, where sales growth in China slowed to be- Basteja Blvd. 14, Riga, LV-1050, Latvia Japan Abs Ret USD A AS EQ CYM 07/31 USD 141.61 –9.5 –17.9 –7.4 Short Bond Fd USD US MM LUX 01/22 USD 2.50 0.0 1.4 2.9 Eq. Japan A OT OT LUX 01/21 JPY 595.58 –10.2 –48.2 –38.0 despite sales slump tween 5% and 10% from October, com- www.parexgroup.com Tel: +371 67010810 Latin America USD A GL EQ CYM 12/31 USD 13.99 2.2 –4.7 14.7 it has 11 stores. Eq. Japan Sm Cap A JP EQ LUX 01/21 JPY 865.24 –4.5 –38.3 –41.7 Paragon Limited USD A EU EQ CYM 12/31 USD 309.60 12.7 12.7 14.2 n SEB Fund 5 Eastern European Bond FundOT OT LVA NA NA NA.00 0.3 –36.1 –17.9 Eq. Japan Target A JP EQ LUX 11/26 JPY 1485.42 –4.2 –9.5 –20.9 French hypermarket chain Carre- pared with between 15% and 18% be- UK Fund USD A OT OT CYM 12/31 USD 165.85 4.3 4.3 3.8 Parex Caspian Sea Eq EU EQ LVA 01/21 EUR 2.24 6.7 –73.9 NS Alpha Bond Fd SEK -A- NO BD LUX 01/22 SEK 9.94 –1.2 –4.0 –0.5 Eq. Pacific A OT OT LUX 01/21 USD 5.65 –11.5 –52.0 –23.5 By Mei Fong fore the Summer Olympics. Alpha Bond Fd SEK -B- NO BD LUX 01/22 SEK 8.92 –1.2 –4.0 –0.5 four says it plans to open as many as Parex Eastern Europ Bd EU BD LVA 01/21 USD 8.75 0.3 –36.1 –17.9 n PT CIPTADANA ASSET MANAGEMENT Eq. Switzerland A OT OT LUX 04/17 CHF 36.35 –16.6 –21.3 –4.3 Alpha Bond Fd SEK -C- NO BD LUX 01/22 SEK 24.91 –1.2 –4.1 –0.7 Even so, retailers that have the fi- Parex Russian Eq EE EQ LVA 01/21 USD 7.78 –10.2 –73.1 –41.4 Eq. UK A OT OT LUX 01/13 GBP 9.64 1.0 –39.3 –26.9 28 stores in China this year, up from Tel: 521-3479 Fax: 521-3478 Website: www.ciptadana-asset.com Alpha Bond Fd SEK -D- NO BD LUX 01/22 SEK 8.30 –1.2 –4.1 –0.7 Eq. US ConcenCore A US EQ LUX 01/21 USD 15.51 –4.5 –34.6 –20.0 SHANGHAI—Some of the biggest nancial strength to expand are tak- Indonesian Grth Fund EA EQ CYM 01/21 USD 57.71 0.0 –54.5 –22.0 Alpha Short Bd SEK -A- NO MM LUX 01/22 SEK 10.87 0.6 3.2 3.2 22 last year. Eq. US Lg Cap Gr A OT OT LUX 01/21 USD 10.52 –2.4 –41.0 –24.6 ing the long-term view of the Chi- Alpha Short Bd SEK -B- NO MM LUX 01/22 SEK 10.19 0.6 3.2 3.2 international retailers are going n RUSSELL INVESTMENT GROUP Eq. US Mid Cap A US EQ LUX 01/20 USD 18.22 –9.1 –45.0 –23.7 Wal-Mart, which opened 30 Alpha Short Bd SEK -C- NO MM LUX 01/22 SEK 21.27 0.6 3.1 3.0 nese market. Eq. US Multi Strg A US EQ LUX 01/20 USD 14.67 –8.2 –42.8 –28.0 ahead with ambitious expansion Multi-Style, Multi-Manager Funds www.russell.com Alpha Short Bd SEK -D- NO MM LUX 01/22 SEK 8.84 0.6 3.1 3.0 stores last year and 17 the year be- Eq. US Rel Val A US EQ LUX 01/21 USD 14.78 –4.8 –42.9 –30.4 “Expansion is not going to Actions France A EU EQ IRL 01/21 EUR 512.60 –9.0 –36.6 NS Bond Fd SEK -C- NO BD LUX 01/22 SEK 41.45 –0.2 7.8 5.6 plans in China, which they hope will Eq. US Sm Cap Val A OT OT LUX 01/20 USD 11.31 –12.6 –48.7 –34.9 fore, sees no reason to slow down Core Eurozone Eq B EU EQ IRL 01/21 EUR 593.49 –9.7 NS NS Bond Fd SEK -D- NO BD LUX 01/22 SEK 12.44 –0.2 6.6 5.0 remain a relative bright spot in a stop—we look at the situation as tem- Eq. US Value Opp A US EQ LUX 01/21 USD 12.12 –6.5 –44.9 –33.1 expansion, said spokesman Euro Fixed Income A EU BD IRL 01/21 EUR 1120.09 –1.1 –11.9 –6.2 Corp. Bond Fd EUR -C- EU BD LUX 01/22 EUR 1.10 0.6 –7.9 –3.8 porary,” said Clarence Wong, chief fi- n PICTET & CIE, ROUTE DESACACIAS 60, CH-1211 GENEVA 73 Money Market EURO A OT OT LUX 01/21 EUR 27.16 0.1 4.2 4.0 world of slumping sales. Euro Fixed Income B EU BD IRL 01/21 EUR 1189.04 –1.0 –11.4 –5.7 Corp. Bond Fd EUR -D- EU BD LUX 01/22 EUR 0.86 0.6 –8.3 –4.0 Jonathan Dong. Money Market USD A OT OT LUX 01/21 USD 15.76 0.1 2.7 3.8 Companies like U.K. supermar- nancial officer for the department Tel: + 41 (58) 323 3000 Web: www.pictetfunds.com Euro Small Cap A EU EQ IRL 01/21 EUR 820.36 –3.2 –42.8 –36.6 Corp. Bond Fd SEK -C- NO BD LUX 01/22 SEK 10.78 0.4 –12.3 –5.5 Wal-Mart said the company will store Parkson Group. “We’re still PF (LUX)-Asian Eq-Ica AS EQ LUX 01/22 USD 98.70 –11.0 –49.9 –25.1 Euro Small Cap B EU EQ IRL 01/21 EUR 873.80 –3.2 –42.4 –36.3 Corp. Bond Fd SEK -D- NO BD LUX 01/22 SEK 8.47 0.4 –12.1 –5.4 ket chain Tesco PLC and big-box re- PF (LUX)-Asian Eq-Pca AS EQ LUX 01/22 USD 94.69 –11.0 –50.5 –25.7 continue to open new stores at a dou- bullish about China and the economy Eurozone Agg Eq A EU EQ IRL 01/21 EUR 460.70 –7.3 –42.3 NS Danish Mortgage Bond Fd EURNO -ID- BD LUX 01/22 EUR 103.99 0.1 NS NS tailers Carrefour SA and Wal-Mart PF (LUX)-Biotech-Pca OT EQ LUX 01/21 USD 292.03 2.4 –12.5 –0.6 Eurozone Agg Eq B EU EQ IRL 01/21 EUR 658.37 –7.3 –42.0 –30.3 Danish Mortgage Bond Fd EURNO -RC- BD LUX 01/22 EUR 103.67 0.1 NS NS ble digit pace in China because “the Glbl Bd (EuroHdg) A GL BD IRL 01/21 EUR 1208.20 0.9 –8.0 –2.9 Danish Mortgage Bond Fd SEKNO -ID- BD LUX 12/17 SEK 121.91 NS NS NS Stores Inc. continue to see the Chi- but since the second half of last year PF (LUX)-CHF Liq-Pca CH MM LUX 01/21 CHF 124.04 0.1 1.6 1.8 market still has big potential. We are the trading environment has become PF (LUX)-CHF Liq-Pdi CH MM LUX 01/21 CHF 93.63 0.1 1.6 1.8 Glbl Bd (EuroHdg) B GL BD IRL 01/21 EUR 1275.23 0.9 –7.3 –2.3 Danish Mortgage Bond Fd SEKNO -RC- BD LUX 01/22 SEK 1110.54 0.1 NS NS nese consumer as a good long-term Glbl Bd A EU BD IRL 01/21 EUR 1046.89 6.8 1.0 –0.9 Flexible Bond Fd -C- NO BD LUX 01/22 SEK 20.96 0.4 5.6 4.3 PF (LUX)-Cnt Eu Eq-I EU EQ LUX 01/21 EUR 109.87 –6.9 –40.4 –29.6 n in the food business, and people are tougher, and we expect the first half Glbl Bd B EU BD IRL 01/21 EUR 1108.28 6.8 1.6 –0.3 Flexible Bond Fd -D- NO BD LUX 01/22 SEK 11.86 0.4 5.6 4.3 YUKI MANAGEMENT & RESEARCH CO., LTD. bet. Despite a sharp slowdown in PF (LUX)-Digital Comm-Pca OT EQ LUX 01/21 USD 76.52 –5.9 –37.7 –18.1 Glbl Real Estate A OT EQ IRL 01/21 USD 581.59 –12.8 –47.6 –36.0 Tel: +81-3-5299-3277 www.yukijapan.co.jp still buying,” Mr. Dong said. Wal- of this year to be similar.” PF (LUX)-East Eu-Pca EU EQ LUX 01/21 EUR 126.12 –5.5 –72.9 –45.2 n SEB Global Hedge China’s overall economic growth Glbl Real Estate B OT EQ IRL 01/21 USD 596.21 –12.7 –47.3 –35.7 YMR-N Growth Fund JP EQ IRL 01/22 JPY 7836.00 –8.9 –41.0 –37.5 Mart doesn’t disclose individual Parkson has 42 department PF (LUX)-Emg Mkts LC-Pca GL EQ LUX 01/22 USD 84.79 –9.0 –55.8 –28.6 and clear signs of flagging in con- Glbl Real Estate EH-A OT EQ IRL 01/21 EUR 552.85 –11.9 –46.0 –36.7 Global Hedge I SEK -C- OT OT LUX 01/22 SEK 79.73 –0.4 –22.1 –13.6 YMR-N Japan Fund JP EQ IRL 01/22 JPY 8468.00 –10.3 –38.2 –34.4 PF (LUX)-Emg Mkts-Pca GL EQ LUX 01/22 USD 280.03 –8.0 –54.7 –28.1 Global Hedge I SEK -D- OT OT LUX 01/22 SEK 72.86 –0.4 –24.3 –14.9 country numbers but the China oper- stores in China and will open another Glbl Real Estate SH-B OT EQ IRL 01/21 GBP 51.86 –12.5 –46.0 –36.0 YMR-N Low Price Fund JP EQ IRL 01/22 JPY 11975.00 –7.7 –31.3 –33.7 sumer sentiment, retail sales PF (LUX)-Eu Indx-Pca EU EQ LUX 01/21 EUR 71.68 –6.2 –38.2 –27.6 YMR-N Small Cap Fund JP EQ IRL 01/22 JPY 5948.00 –7.3 –37.3 –38.5 Glbl Strategic Yield A EU BD IRL 01/21 EUR 1153.42 2.0 –21.6 –11.9 n ation is profitable, he said. As of No- four to five new stores this year in PF (LUX)-EUR Bds-Pca EU BD LUX 01/21 EUR 367.77 –1.5 –0.5 0.2 SEB Sicav 1 growth is still positive. Glbl Strategic Yield B EU BD IRL 01/21 EUR 1227.29 2.1 –21.1 –11.4 Yuki Mizuho Gen Jpn III JP EQ IRL 01/22 JPY 3814.00 –10.2 –47.5 –40.6 vember the company had 217 retail the country. The Hong Kong-listed PF (LUX)-EUR Bds-Pdi EU BD LUX 01/21 EUR 279.87 –1.5 –0.5 0.2 Choice Emerging Mkts Fd GL EQ LUX 01/22 USD 1.39 –9.4 –48.7 –22.2 Yuki Mizuho Jpn Dyn Gro AS EQ IRL 01/22 JPY 4039.00 –10.1 –46.9 –42.4 Retailers “look stupid if they Getty Images Japan Equity A JP EQ IRL 01/21 JPY 9470.00 –8.4 –41.0 –33.5 units in China. company reported a 21% rise in total PF (LUX)-EUR Cp Bd-Pca EU BD LUX 01/21 EUR 126.59 1.4 –4.9 –2.3 Japan Equity B JP EQ IRL 01/21 JPY 10036.00 –8.3 –40.7 –33.1 n SEB Sicav 2 Yuki Mizuho Jpn Exc 100 JP EQ IRL 01/22 JPY 5524.00 –9.5 –44.8 –39.9 Ikea plans to add two more stores in China, like this one in Nanjing, the Yuki Mizuho Jpn Gen JP EQ IRL 01/22 JPY 7209.00 –10.1 –40.4 –37.0 open in Europe or the U.S., so emerg- PF (LUX)-EUR Cp Bd-Pdi EU BD LUX 01/21 EUR 88.99 1.4 –4.9 –2.3 PacBasn (Ex-Jap) Eq A AS EQ IRL 01/21 USD 1148.19 –10.7 –50.3 –25.4 Choice Asia SmCap exJpn AS EQ LUX 01/22 SEK 16.89 0.6 –39.1 –25.9 sales to 5.2 billion yuan, with a 14.4% Yuki Mizuho Jpn Gro JP EQ IRL 01/22 JPY 5684.00 –9.1 –41.2 –39.0 ing markets [like China] look more at- Other retailers either entering housewares company’s sixth in the country. Wal-Mart opened 30 last year. PF (LUX)-EUR HiYld-Pca EU BD LUX 01/21 EUR 96.03 6.5 –29.1 –20.0 PacBasn (Ex-Jap) Eq B AS EQ IRL 01/21 USD 1218.44 –10.7 –50.0 –24.9 Europe Chance/Risk Fd EU EQ LUX 01/22 EUR 715.53 –6.2 –50.1 –35.8 rise in same-store sales in its 2008 in- Yuki Mizuho Jpn Inc JP EQ IRL 01/22 JPY 7391.00 –7.1 –31.6 –31.5 the China market or expanding in- PF (LUX)-EUR HiYld-Pdi EU BD LUX 01/21 EUR 55.67 6.5 –29.1 –20.0 Pan European Eq A EU EQ IRL 01/21 EUR 677.91 –5.7 –41.5 –30.4 tractive,” said Morgan Parker, Asia Yuki Mizuho Jpn Lg Cap AS EQ IRL 01/22 JPY 4486.00 –10.0 –40.1 –35.0 terim results. PF (LUX)-EUR Liq-Pca EU MM LUX 01/21 EUR 134.86 0.2 3.5 3.5 Pan European Eq B EU EQ IRL 01/21 EUR 718.60 –5.6 –41.2 –30.0 clude housing goods giant Ikea, Yuki Mizuho Jpn LowP JP EQ IRL 01/22 JPY 10138.00 –10.5 –28.8 –30.9 president of luxury mall developer PF (LUX)-EUR Liq-Pdi EU MM LUX 01/21 EUR 97.19 0.2 3.5 3.5 US Equity A US EQ IRL 01/21 USD 618.33 –7.6 –37.5 –24.2 Chinese consumers retain an ap- Yuki Mizuho Jpn PGth JP EQ IRL 01/22 JPY 6888.00 –9.8 –46.6 –39.0 which plans to add two more stores A Chinese consumer confidence US Equity B US EQ IRL 01/21 USD 658.17 –7.6 –37.1 –23.8 Taubman Centers Inc. zie, head of consumer research at PF (LUX)-Europ Eq-Pca EU EQ LUX 01/21 EUR 289.76 –5.3 –42.7 –32.0 Yuki Mizuho Jpn SmCp JP EQ IRL 01/22 JPY 5731.00 –6.6 –40.5 –39.2 petite for shopping. Retail sales dur- US Small Cap A US EQ IRL 01/21 USD 935.41 –7.0 –34.9 –24.5 China’s official indicator of re- to its existing six outlets in China. Ca- index by Beijing-based consultancy Hong Kong brokerage CLSA Asia Pa- PF (LUX)-EuSust Eq-Pca EU EQ LUX 01/21 EUR 94.73 –6.3 –39.6 –30.7 Yuki Mizuho Jpn Val Sel AS EQ IRL 01/22 JPY 4794.00 –7.7 –37.1 –34.7 ing the three-day New Year holiday US Small Cap B US EQ IRL 01/21 USD 996.51 –6.9 –34.5 –24.1 tails sales is holding up reasonably nadian shopping center developer Horizon Group shows Chinese con- cific Markets. According to CLSA, PF (LUX)-Gl Em Dbt-Pca GL BD LUX 01/21 USD 189.34 0.0 –6.3 –0.2 Yuki Mizuho Jpn YoungCo AS EQ IRL 01/22 JPY 2280.00 –4.5 –51.1 –51.1 were stronger than expected, rising PF (LUX)-Gl Em Dbt-Pdi GL BD LUX 01/21 USD 128.81 0.0 –6.3 –0.2 n n THE NATIONAL INVESTOR Ivanhoe Cambridge Inc. says it is on sumer confidence in December at its same-store sales growth peaked in SEB ASSET MANAGEMENT S.A. n Yuki 77 Series well, although some economists 13% to $1.8 billion dollars. Growth PF (LUX)-Gl Eq Sel-Pca GL EQ LUX 01/21 USD 11.93 –7.0 –44.8 –28.7 PO Box 47435, Abu Dhabi, UAE Web:www.tni.ae www.seb.se Yuki 77 Excellent JP EQ IRL 01/22 JPY 3815.00 –9.2 –46.1 –39.2 question the accuracy of the data. track to buy its first Chinese mall lowest point since 2003, after the the second half of 2007 and the first PF (LUX)-Gr China-Pca AS EQ LUX 01/21 USD 189.86 –10.7 –48.9 –20.1 Email: [email protected] Tel:+971 2 619 2300 during this period was even higher in SEB Fund 1 Yuki 77 General JP EQ IRL 01/22 JPY 5432.00 –8.0 –41.1 –36.4 PF (LUX)-Indian Eq-Pca EA EQ LUX 01/22 USD 174.38 –9.0 –59.7 –27.2 MENA Real Estate Acc Fund OT OT ARE 01/15 USD 9.25 –1.6 –40.3 –1.5 The data indicate slackening growth: this year. country was hit by the SARS epi- quarter of 2008. “Now on average it Choice Global Value -C- GL EQ LUX 01/22 SEK 55.70 –7.4 –42.5 –32.4 Yuki 77 Growth JP EQ IRL 01/22 JPY 5248.00 –11.3 –45.3 –40.9 inland China, rising 50% in cities like PF (LUX)-Jap Index-Pca JP EQ LUX 01/22 JPY 7532.36 –7.5 –35.8 –32.0 UAE Blue Chip Fund Acc OT OT ARE 01/15 AED 4.43 –3.3 –62.6 –23.8 up 20.8% in December from the same These ventures, some planned be- demic. Horizon’s study showed that is down to around 10%, and in some Choice Japan Fd JP EQ LUX 01/22 JPY 41.85 –6.9 –35.1 –33.7 Yuki 77 Income AS EQ IRL 01/22 JPY 4771.00 –6.7 –30.7 NS Chongqing, according to Shanghai- PF (LUX)-Jp Eq Sel-Ica JP EQ LUX 01/22 JPY 6772.62 –7.2 –37.6 –36.8 Choice Jpn Chance/Risk JP EQ LUX 01/22 JPY 41.88 –6.5 –41.7 –34.6 month a year earlier, compared to an fore the onset of the global slump, consumers are likely to reduce con- cases single digits,” he said. based retail consultancy AccessAsia. PF (LUX)-Jp Eq Sel-Pca JP EQ LUX 01/22 JPY 6608.34 –7.3 –38.0 –37.1 Choice NthAmChance/Risk US EQ LUX 01/22 USD 2.74 –2.2 –38.0 –24.7 n Yuki Chugoku Series increase of 22% in October and 23% come in the face of a slowing Chinese sumption further after next week’s It can take three to five years for Advertising spending—which is PF (LUX)-JpEq130/30-Pca JP EQ LUX 01/22 JPY 3646.20 –7.1 –34.8 –35.1 Europe 2 Fd EU EQ LUX 01/22 EUR 0.65 –5.8 –46.7 –33.6 Yuki Chugoku Jpn Gen JP EQ IRL 01/22 JPY 5764.00 –7.6 –39.1 –35.5 economy. A survey of more than Lunar New Year holidays, when sal- PF (LUX)-Pacif Idx-Pca AS EQ LUX 01/22 USD 143.60 –9.3 –44.2 –24.1 Europe 3 Fd EU EQ LUX 01/22 GBP 2.73 –8.8 –32.3 –20.1 Yuki Chugoku Jpn Gro JP EQ IRL 01/22 JPY 4577.00 –10.5 –42.6 –35.9 in September. By comparison, retail individual stores to become profit- tied to consumer demand—is ex- PF (LUX)-Piclife-Pca CH BA LUX 01/21 CHF 689.60 0.0 –14.2 –11.1 Global Chance/Risk Fd GL EQ LUX 01/22 EUR 0.48 2.9 –28.8 –24.3 Yuki Chugoku JpnLowP JP EQ IRL 01/22 JPY 7412.00 –9.5 –27.7 –28.8 sales in the U.S fell 2.7% in December, 11,000 people in China released Jan. ary cuts are expected. And Research able in China, and many aren’t, said pected to grow 13% in China this year, PF (LUX)-PremBrnds-Pca OT EQ LUX 01/21 EUR 41.18 –6.7 –37.5 –28.8 Global Fd GL EQ LUX 01/22 USD 1.54 –7.4 –38.5 –25.0 Yuki Chugoku JpnPurGth JP EQ IRL 01/22 JPY 4163.00 –11.0 –40.2 –36.9 PF (LUX)-Rus Eq-Pca EE EQ LUX 01/21 USD 19.43 –14.9 –77.1 NS Intl Mixed Fd -C- NO BA LUX 01/22 USD 21.22 –7.6 –29.0 –16.5 the sixth consecutive monthly drop. 16 by research consultancy Millward firm Data Driven Marketing Asia Mr. Parker from Taubman. The de- with forecast yield of $4.6 billion in ex- n TRIGON CAPITAL n Yuki Daishi Series PF (LUX)-Security-Pca GL EQ LUX 01/21 USD 69.48 –2.8 –27.7 –17.9 Intl Mixed Fd -D- NO BA LUX 01/22 USD 14.97 –7.6 –29.0 –15.4 Phone +372 667 9208 Fax +372 667 9221 E-mail [email protected] Website www.trigoncapital.comYuki Daishi General JP EQ IRL 01/22 JPY 6254.00 –7.6 –40.3 –36.5 Tesco says it is expanding its Brown showed that 78% of Chinese said a telephone survey of 4,500 con- veloper currently has two shopping pected new demand that will go some Wireless Fd OT EQ LUX 01/22 EUR 0.09 0.2 –39.3 –25.2 PF (LUX)-Sm Cap Eu-Pca EU EQ LUX 01/21 EUR 319.43 –2.1 –36.7 –29.6 Central and Eastern EuropeanEE EUR EQ EST 01/22 EEK 98.57 –1.3 –56.7 –39.4 store network in China even as it consumers are already feeling some sumers showed 60% of consumers malls under development in Asia, way toward making up the shortfall in PF (LUX)-US Eq-Ica US EQ LUX 01/21 USD 77.12 –5.5 –34.0 –19.7 New Europe Small Cap EUR EE EQ EST 01/22 EEK 45.74 –4.6 –61.3 –42.8 n n SEB Fund 2 Yuki Hokuyo Japan Series plan to cut spending this year, PF (LUX)-USA Index-Pca US EQ LUX 01/21 USD 67.49 –6.9 –35.6 –22.3 Second Wave EUR EE EQ EST 01/22 EEK 82.31 –3.3 –65.1 –38.7 Yuki Hokuyo Jpn Gen JP EQ IRL 01/22 JPY 4154.00 –8.7 –40.8 –36.0 cuts down on capital expenditure impact from the global financial cri- including one in Macau, whose U.S. ad spend, forecast to shrink by Choice Asia ex. Japan Fd AS EQ LUX 01/22 USD 4.11 –9.3 –44.6 –24.7 PF (LUX)-USD Gov Bds-Pca US BD LUX 01/21 USD 522.47 –1.5 8.2 8.7 Yuki Hokuyo Jpn Inc JP EQ IRL 01/22 JPY 4843.00 –8.3 –30.3 –30.7 and opens fewer stores in Britain. A sis, with those affected most likely to mainly because of fears of job losses. opening has now been delayed by a $5.2 billion, according to media invest- Currency Alpha EUR -IC- OT OT LUX 01/22 EUR 10.83 –0.8 6.2 NS n WWW.SGAM.COM SGAM FUND PF (LUX)-USD Gov Bds-Pdi US BD LUX 01/21 USD 383.38 –1.5 8.2 8.7 Yuki Hokuyo Jpn Sm Cap JP EQ IRL 01/22 JPY 4381.00 –6.9 –35.1 NS Currency Alpha EUR -RC- OT OT LUX 01/22 EUR 10.78 –0.8 5.8 NS Bonds CHF A OT OT LUX 01/19 CHF 27.92 –1.0 5.3 2.5 Tesco spokesman says the company cut down on Western fast food, trav- China’s retail sector will “cer- year to 2011 because of the finan- ment company GroupM Inc. PF (LUX)-USD Liq-Pca US MM LUX 01/21 USD 130.26 0.1 2.2 3.4 Currency Alpha SEK -ID- OT OT LUX 01/22 SEK 104.67 –0.9 NS NS Bonds ConvEurope A EU BD LUX 01/20 EUR 28.34 0.0 –2.7 1.5 n Yuki Nishi Nippon City Japan Series has a “strong opening plan” in China eling, entertainment and luxury tainly be slower than anything we’ve cial slowdown. —Norihiko Shirouzu PF (LUX)-USD Liq-Pdi US MM LUX 01/21 USD 85.06 0.1 2.2 3.4 Currency Alpha SEK -RC- OT OT LUX 01/22 SEK 115.44 –0.8 5.8 NS Bonds Eur Corp A EU BD LUX 01/20 EUR 20.98 1.2 –5.5 –2.8 Yuki Nishi-Nippon Cty GeneralJP EQ IRL 01/22 JPY 4175.00 –7.2 –45.7 –39.6 PF (LUX)-Water-Pca GL EQ LUX 01/21 EUR 105.30 2.2 –25.7 –17.0 for 2009, which includes the first items such as jewelry. seen in memory,” said Paul McKen- Japanese supermarket chain contributed to this article. Generation Fd 80 OT OT LUX 01/22 SEK 6.16 –3.4 –26.2 NS Bonds Eur Hi Yld A OT OT LUX 01/20 EUR 14.04 5.6 –30.9 –20.1 Yuki Nishi-Nippon Cty PurGthJpJP EQ IRL 01/22 JPY 3905.00 –10.5 –44.9 –39.2 PF (LUX)-WldGovBds-Pca GL BD LUX 01/21 USD 158.98 –3.6 4.9 9.1 Nordic Focus EUR NO EQ LUX 01/22 EUR 50.58 1.4 –36.4 NS Bonds EURO A OT OT LUX 01/21 EUR 39.22 –0.7 3.6 3.3 PF (LUX)-WldGovBds-Pdi GL BD LUX 01/21 USD 131.59 –3.6 4.9 9.0 Nordic Focus NOK NO EQ LUX 01/22 NOK 57.00 1.4 –36.4 NS Bonds Europe A OT OT LUX 01/20 EUR 37.62 –0.7 3.4 2.4 n Yuki Shizuoka Japan Series PTF (LUX)-MidEast&NorAfr-PcaGL EQ LUX 01/22 USD 30.21 –27.2 NS NS Nordic Focus SEK NO EQ LUX 01/22 SEK 57.71 1.4 –36.4 NS Bonds US MtgBkSec A US BD LUX 01/21 USD 25.15 –1.8 –2.7 2.3 Yuki Shizuoka General Japan JP EQ IRL 01/22 JPY 4583.00 –10.1 –38.0 –37.1 Apple’s results defy downturn, but outlook is cautious Advertisement [ ALTERNATIVE INVESTMENT FUNDS www.WSJ.com ] Advertisement By Yukari Iwatani Kane 12-month and 2-year returns may be calculated over 11- and 23-month NAV — %RETURN — NAV — %RETURN — technology companies—including been reluctant to provide informa- company over how to punish those periods 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 And Kara Scannell Yahoo Inc. and Hewlett-Packard tion and have said Mr. Jobs’s health who leaked corporate information. In Apple waxes NAV — %RETURN — INDICES Harmony Cap Ltd D USD OT OT BMU 12/31 USD 1184.67 –11.9 –11.9 –4.8 n HSBC Uni-folio Co.—also have announced layoffs. is a private matter. Some investors announcing the resignation, H-P FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR Apple’s quarterly net income Harmony Cap Ltd E EUR OT OT BMU 12/31 USD 1154.79 –10.8 –10.8 –4.9 Alpha AdvantEdge OT OT JEY 12/31 USD 107.06 –19.7 –19.7 –6.2 Harmony Cap Ltd F GBP OT OT BMU 12/31 GBP 1008.01 –10.3 –10.3 –3.7 NAV % RETURN Apple Inc. defied the recession Meanwhile, the U.S. Securities and analysts have criticized the dis- didn’t disclose the disagreement. Asian AdbantEdge EUR OT OT JEY 12/31 EUR 88.69 –25.3 –25.3 NS FUND NAME GF DATE CR NAV 1-WK 1-MO 1-Q 1-YR 2-YR n Asian AdvantEdge OT OT JEY 12/31 USD 162.03 –24.2 –24.2 –3.8 and technology slump by posting and Exchange Commission has closures as inadequate, saying The SEC said H-P erred because $2.0 billion HERMITAGE CAPITAL MANAGEMENT LTD. n ARIX ABSOLUTE RETURN INVESTABLE INDEX Tel: +7501 258 3160 www.hermitagefund.com Emerg AdvantEdge OT OT JEY 12/31 USD 140.36 –32.2 –32.2 –8.9 strong sales and profit for the holi- opened an inquiry into Apple’s dis- among other things that Mr. Jobs’s under U.S. securities laws, a com- Emerg AdvantEdge EUR OT OT JEY 12/31 EUR 78.55 –34.1 –34.1 NS Feri Institutional Advisors, www.feri.de The Hermitage Fund GL EQ JEY 01/09 USD 475.86 NS NS NS ARIX Composite Gross USD OT 12/31 USD 1269.10 NS –2.7 –11.0 –19.4 –6.7 day quarter. But it gave a cautious closures about Mr. Jobs’s health, reference to a “hormone imbal- pany needs to disclose the reason if Europ AdvantEdge EUR OT OT JEY 12/31 EUR 115.25 –19.2 –19.2 –7.9 1.5 n HORSEMAN CAPITAL MANAGEMENT LTD. Europ AdvantEdge USD OT OT JEY 12/31 USD 122.02 –18.3 –18.3 –6.8 outlook for the current period amid people familiar with the matter said ance” was too general. a director leaves over a disagree- n 788 ASSET MANAGEMENT LTD. NAV — %RETURN — T: +44(0)20 7838 7580, F: +44(0) 20 7838 7590, www.horsemancapital.com Japan AdvantEdge JPY OT OT JEY 12/31 JPY 8080.25 –13.9 –13.9 –9.7 FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR [email protected] www.788am.com news that the U.S. government is ex- Wednesday. This month, Mr. Jobs, a Companies aren’t required to dis- ment about company policy. H-P Horseman EmMkt Opp EUR GL EQ GBR 12/31 EUR 214.76 15.9 15.9 35.2 Japan AdvantEdge USD OT OT JEY 12/31 USD 94.08 –12.4 –12.4 –6.7 788 China Smaller Cap OT OT CYM 11/28 USD 15.43 NS NS NS Horseman EmMkt Opp USD GL EQ USA 12/31 USD 219.48 14.6 14.6 36.0 amining how the company dis- cancer survivor, said he would be close information about executives’ said it believed Mr. Perkins had an is- 1.0 788 Gl Asset Alloc. Fd OT OT CYM 11/28 USD 68.65 –52.2 –51.4 –23.5 Lvgd Alpha AdvantEdge OT OT JEY 12/31 USD 85.85 –40.9 –40.9 –18.5 Horseman EurSelLtd EUR EU EQ GBR 12/31 EUR 209.19 16.5 16.5 19.0 Trading AdvantEdge OT OT GGY 12/31 USD 151.67 12.8 12.8 16.1 n OTHER FUNDS closed Chief Executive Steve Jobs’s taking a leave of absence from the health but once they do issue a state- sue with the company’s then-chair- n ALEXANDRA INVESTMENT MANAGEMENT Horseman EurSelLtd USD EU EQ GBR 12/31 USD 217.51 15.7 15.7 19.4 Trading AdvantEdge EUR OT OT GGY 12/31 EUR 137.63 12.7 12.7 15.0 health issues. Cupertino, Calif., company until the ment, it has to be accurate and can’t man and not the company as a Alexandra Global Inv I OT OT VGB 11/28 USD 36.36 –10.3 –1.0 5.6 Horseman Glbl Ltd EUR GL EQ CYM 12/31 USD 492.53 31.3 31.3 32.1 Trading AdvantEdge GBP OT OT GGY 12/31 GBP 145.50 15.6 15.6 17.4 For information about these funds, please contact us on Tel: +44 (0) 207 842 9694/9633 Horseman Glbl Ltd USD GL EQ CYM 12/31 USD 492.53 31.3 31.3 32.1 Medinvest Plc Dublin OT OT IRL 10/31 USD 1253.68 –15.5 –16.4 –0.8 Bucking the falloff in consumer end of June to deal with “more com- be misleading, according to securi- whole. It agreed to cease and desist 0.5 US AdvantEdge OT OT JEY 12/31 USD 102.32 –19.1 –19.1 –6.0 n HSBC ALTERNATIVE INVESTMENTS LIMITED spending, Apple Wednesday re- plex” medical problems for ties lawyers. from securities-law violations, and T +44 20 7860 3074 F + 44 20 7860 3174 www.hail.hsbc.com ported strong increases in sales of which he provided no de- Another issue is how didn’t receive further punishment. 0 HSBC Absolute Companies its Macintosh computers and tails. His announcement critical that information is At Apple, the temporary leave by FY’07 ’08 ’09 HSBC Absolute Companies Euro Absolute OT OT GGY 09/30 GBP 1.43 –12.1 –12.2 –0.7 iPhone cellphones in its fiscal quar- came several days after he to investors. When Apple Mr. Jobs—who is deeply involved in Fiscal years end in September of the year shown n CAPITAL MANAGEMENT ADVISORS Euro Absolute EUR OT OT GGY 09/30 EUR 2.01 –12.3 –12.6 –2.2 Phone Number: +1 441 295 59 29 Global Absolute OT OT GGY 12/31 GBP 0.94 –16.1 –16.1 –3.5 ter ended Dec. 27. That powered a said he had a “hormone im- disclosed that Mr. Jobs all aspects of its operations—ap- n INTEGRATED ALTERNATIVE INVESTMENTS, TEL: +44 (0)20 75149200n SUPERFUND ASSET MANAGEMENT GMBH Source: the company CMA Dynamic OT OT BHS 11/28 USD 1358.28 0.5 4.1 5.9 Global Absolute USD OT OT GGY 12/31 USD 1.76 –15.9 –15.9 –2.9 5.8% rise in revenue and a 1.5% gain balance” for which he had would be on leave for six peared to come at a challenging Email: [email protected] - Website: www.integratedai.com For information about open funds, please contact us on Tel: +43 1 24700 CMA MultHdge Arbtrge OT OT CYM 11/28 USD 1742.25 –9.8 –9.6 –1.4 n in profit, sending its quarterly sales begun “relatively simple months, the company’s time for the company. Apple prices CMA MultHdge Balncd OT OT CYM 11/28 USD 1244.27 0.4 4.8 5.8 HSBC ALTERNATIVE STRATEGY FUND Altipro OT OT FRA 12/31 EUR 245.96 –3.3 –3.3 1.0 www.superfund.com *Closed for New Investments CMA MultHdge Growth OT OT CYM 11/28 USD 1703.29 2.7 7.0 6.4 Special Opp EUR OT OT CYM 12/31 EUR 76.32 –31.8 –31.8 NS Integrated Dir Trading EUR OT OT CYM 10/31 EUR 101.42 –1.0 1.4 6.1 Superfund Cayman* OT OT CYM 01/13 USD 84.18 1.1 76.2 30.8 Special Opp Inst EUR OT OT CYM 12/31 EUR 71.80 –31.4 –31.4 NS past $10 billion for the first time. and straightforward” treat- stock price fell 7% in after- most of its products at a premium to Apple accounts for iPhone sales CMA MultiHdge Lvrgd OT OT CYM 11/28 USD 946.28 –0.3 1.6 6.7 Integrated Emg Markets EUROT OT CYM 10/31 EUR 75.74 –27.9 –29.3 –9.0 Superfund GCT USD* GL EQ LUX 01/13 USD 3676.00 0.7 50.3 18.5 Special Opp Inst USD OT OT CYM 12/31 USD 80.72 –29.4 –29.4 NS But Apple said it expects sales ment. hours trading, one mea- by dividing revenue over a Integrated European EUR OT OT CYM 10/31 EUR 148.65 0.0 –1.5 2.5 Superfund Gold A (SPC) GL OT CYM 01/13 USD 1088.16 –6.4 17.8 24.3 others in the market, which ana- Special Opp USD OT OT CYM 12/31 USD 79.59 –29.9 –29.9 NS and profit to be lower in the current Spokesmen for Apple sure regulators often use lysts say could hurt the company as 24-month period, the length of time Integrated Event Driven EUROT OT CYM 10/31 EUR 87.20 –18.7 –20.2 –3.6 Superfund Gold B (SPC) GL OT CYM 01/13 USD 1266.70 –6.0 30.0 28.6 n HSBC Portfolio Selection Fund Integrated Lg/Sh Sel F EUR OT OT CYM 09/30 EUR 89.88 –10.1 –9.3 2.9 Superfund Q-AG* OT OT AUT 01/13 EUR 8800.00 0.4 35.6 16.0 quarter than Wall Street projects. and the SEC both declined in determining how impor- consumers pinch their pennies. that a consumer is expected to use GH Fund AP OT OT JEY 12/31 EUR 119.30 –15.8 –15.8 –1.7 Integrated MultSt B EUR OT OT VGB 10/31 EUR 117.21 –16.0 –16.4 –3.5 The company puts revenue at $7.6 to comment about the in- tant information is to inves- But Apple’s sales have held up the phone. The company said its GH Fund CHF Hdg OT OT JEY 12/31 CHF 99.82 –18.6 –18.6 –5.6 Integrated Relative Value EUROT OT CYM 09/30 EUR 96.76 –3.7 –3.4 2.4 n WEAVERING CAPITAL GH Fund EUR Hdg OT OT JEY 12/31 EUR 108.50 –17.8 –17.8 –4.2 www.weaveringcapital.com [email protected] T:+44(0)2073554720 billion to $8 billion, about flat from quiry. tors. “If they knew at that better than those of many other com- quarterly net income overall would n KREDIETBANK LUXEMBOURG Steve Jobs n CARLO SCEVOLA & PARTNERS GH Fund EUR Hdg (Non-V II)OT OT JEY 12/31 EUR 96.32 –17.7 –17.7 –4.2 Weavering Macro F.I. Fd GL OT CYM 01/05 USD 183.77 0.0 11.5 12.2 a year ago, with diluted earnings per It is unclear how ad- time that statement [about panies that sell consumer products. have been $2.3 billion and revenue Tel +44 (0) 20 7419 5671 GH Fund EUR Hdg (Non-V) OT OT JEY 12/31 EUR 108.50 –17.8 –17.8 –4.2 www.kbl.lu Fax : +352 47 97 73 911 share of 90 cents to $1. Analysts had vanced the SEC investigation is. Reg- a hormone imbalance] was not cor- During the fourth quarter, Apple would have been $11.8 billion if it www.rescgf.com GH Fund GBP Hdg OT OT JEY 12/31 GBP 117.84 –17.7 –17.7 –3.3 KBL SPOP Investing OT OT LUX 09/30 EUR 1902.24 –13.7 –12.4 0.9 n WINTON CAPITAL MANAGEMENT LTD Resolute Capital Gth Fd OT OT VGB 09/30 USD 1232.97 9.7 14.5 11.0 GH Fund Inst EUR OT OT JEY 12/31 EUR 83.48 NS NS NS KBL SPOP Investing OT OT LUX 09/30 USD 1829.54 –14.3 –12.7 1.6 Tel: +44 (0)20 7610 5350 Fax: +44 (0)20 7610 5301 been projecting profit of $1.13 a ulators often start with informal in- rect that could be a problem for shipped 2.5 million Macintoshes, a fully accounted for the phones right GH Fund Inst JPY OT OT JEY 12/31 JPY 8406.59 –17.2 –17.2 NS KBL SPOP Long/Short Eq OT OT LUX 10/31 USD 391.27 –40.9 –41.9 –12.3 n D'AURIOL FUNDS WWW.DAURIOL.BIZ Winton Evolution EUR GL OT VGB 12/31 EUR 1294.11 3.4 3.4 8.5 quiries to collect information. Staff them,” said Brad Simon, a former GH Fund Inst USD OT OT JEY 12/31 USD 98.67 –16.0 –16.0 –2.1 KBL SPOP Long/Short Eq OT OT LUX 10/31 EUR 371.55 –42.9 –43.8 –14.4 share on revenue of $8.2 billion. 9% increase from a year earlier. away, as it does with other products. 2 FUNDS OF FUNDS OF HEDGE FUNDS GH FUND S EUR OT OT CYM 12/31 EUR 113.05 –17.3 –17.3 –3.4 Winton Evolution GBP GL OT VGB 12/31 GBP 1275.44 4.6 4.6 9.7 Still, Apple’s performance stood attorneys can later ask the SEC com- federal prosecutor. “From what I Sales were helped by the introduc- There were some signs that Ap- D'Auriol Alt Non-Lev A EU OT CYM 11/28 EUR 101.40 –21.7 –21.4 –6.3 GH FUND S GBP OT OT JEY 12/31 GBP 117.63 –16.5 –16.5 –2.2 Winton Evolution JPY GL OT VGB 12/31 JPY 114484.74 –0.4 –0.4 5.0 in contrast to other grim news from missioners to formalize the investi- can see based on what I’m reading, tion of new Macbook laptops in Octo- ple was feeling the effects of the re- D'Auriol Opp F3 EUR EU MM CYM 11/28 EUR 1011.81 –26.2 –26.0 –10.2 GH Fund S USD OT OT CYM 12/31 USD 132.00 –15.5 –15.5 –1.6 Winton Evolution USD GL OT CYM 12/31 USD 1264.06 3.1 3.1 8.7 GH Fund USD OT OT GGY 12/31 USD 243.74 –16.6 –16.6 –2.8 Winton Futures EUR GL OT VGB 12/31 EUR 205.87 21.3 21.3 18.9 the tech sector and the company’s gation, which gives them subpoena it could be a big problem. [Mr. Jobs] ber. Apple also shipped 4.4 million cession. While iPod unit sales grew, Hedge Investments OT OT JEY 12/31 USD 123.89 –15.6 –15.6 –2.3 Winton Futures GBP GL OT VGB 12/31 GBP 221.96 23.1 23.1 20.6 Leverage GH USD OT OT GGY 12/31 USD 97.53 –36.1 –36.1 –12.7 stock was up 8.5% in afternoon trad- power and other tools. The probe is Apple.” iPhones, up 88% from a year earlier, revenue dropped 16% from a year Winton Futures JPY Lead SeriesGL 2 OT VGB 12/31 JPY 14758.61 17.3 17.3 15.5 MultiAdv Arb CHF Hdg OT OT JEY 12/31 CHF 84.01 –26.4 –26.4 –12.7 Winton Futures USD GL OT VGB 12/31 USD 733.31 21.0 21.0 19.5 ing Thursday at $89.83 a share. Intel was earlier reported by Bloomberg In 2007, H-P settled a case with and sold a record 22.7 million iPod earlier, implying customers are grav- MultiAdv Arb EUR Hdg OT OT JEY 12/31 EUR 90.37 –25.7 –25.7 –11.5 n MERIDEN GROUP Corp. said Wednesday it will close News. the SEC, without admitting or deny- digital music players, up 3%. itating toward cheaper models. MultiAdv Arb GBP Hdg OT OT JEY 12/31 GBP 96.92 –26.3 –26.3 –11.4 n ZULAUF EUROPE FUNDS MultiAdv Arb Inst USD OT OT CYM 06/30 USD 98.01 –0.8 NS NS Tel: + 376 741 175 Fax: + 376 741 183 Email: [email protected] Phone: +353 1436 7200 Fax: +353 1672 5361 www.zulaufeurope.ky some older factories, displacing Questions about the health of ing wrongdoing, for failing to de- Overall, Apple’s net income for Meanwhile, iPhone unit sales were n HARMONY CAPITAL MultiAdv Arb S EUR OT OT CYM 12/31 EUR 95.72 –24.8 –24.8 –10.4 Antanta Combined Fund EE EQ AND 01/16 USD 183.06 –4.7 –78.2 –51.3 5,000 to 6,000 workers, though not the 53-year-old Mr. Jobs have hung scribe the reason behind a director’s the period was $1.605 billion, up off 37% from the previous quarter email: [email protected] MultiAdv Arb S GBP OT OT CYM 12/31 GBP 99.72 –25.0 –25.0 –9.8 Antanta MidCap Fund EE EQ AND 01/16 USD 252.06 –13.0 –86.2 –54.1 Zulauf Europe Fd EUR OT OT CYM 01/16 EUR 114.48 –3.6 –19.5 –7.0 Harmony Cap Ltd A USD OT OT BMU 12/31 USD 2067.95 –11.5 –11.5 –4.4 MultiAdv Arb S USD OT OT CYM 12/31 USD 108.31 –23.4 –23.4 –8.9 Meriden Opps Fund GL OT AND 01/21 EUR 86.27 –0.9 –22.1 NS Zulauf Europe Fd LP OT OT CYM 03/31 USD 173.04 1.2 12.5 6.3 all will lose their jobs. Last week, over Apple for the past year since he resignation. H-P director and venture from $1.581 billion a year earlier. ended in September. Harmony Cap Ltd B EUR OT OT BMU 12/31 EUR 2006.83 –10.6 –10.6 –4.5 MultiAdv Arb USD OT OT GGY 12/31 USD 168.78 –24.4 –24.4 –10.1 Meriden Protective Div GL EQ AND 11/24 EUR 78.88 –2.8 NS NS Zulauf Europe Fd USD OT OT CYM 01/16 USD 247.30 –4.4 –18.1 –4.8 Motorola Inc. said it would slash began exhibiting noticeable weight capitalist Tom Perkins had resigned Revenue rose to $10.17 billion from —Justin Scheck jobs, and a number of other leading loss, but the company and CEO have in 2006 after disagreeing with the $9.61 billion. contributed to this article. For information about listing your funds, please contact: Peter Jennings, tel: +44-20-7842-9674; email: [email protected] or Carson Wong tel: +852 2831-6481; email: [email protected] 22 FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 THE WALL STREET JOURNAL. THE WALL STREET JOURNAL. FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 7 THE INTERNATIONAL INVESTOR CORPORATE NEWS GLOBAL BUSINESS BRIEFS

BT Group PLC Centrica PLC IT outsourcing unit’s woes British Gas, the retail arm of U.K. Venture capital performs triage on investments EBay posts first sales slump utility Centrica PLC, said it will cut lead to $475 million charge standard-tariff gas prices by 10% CFares, which Claremont Creek CFares laid off four employees, some of the brunt of the dismal holi- BT Group PLC Thursday began to from Feb. 19 in response to lower Funds double down says hasn’t performed as strongly, reducing its work force to 18 people. Revenue fell 6.7% day shopping season, with online Auction slump reveal the cost of failings at its Global wholesale prices, the first such cut got a C. The venture firm says it will Mr. Kalinske, the CEO, says he spending falling just 3% from a year EBay’s net income, in millions Services division, starting with a by a major energy supplier since on favored holdings, give the Web site the $3.2 million it wasn’t surprised when Claremont as shoppers shied earlier, according to research firm £340 million ($475 million) charge 2007.Centrica said the price cut will has already committed, but won’t Creek said it didn’t plan to give Comscore Inc. EBay, the largest on- $600 and sharply reduced earnings tar- save customers £79 ($110) on the av- cut off the weakest fund the start-up further unless it cFares more new money. Given the from online auctions line retailer by volume, also ap- 500 gets. BT has been reviewing the con- erage annual household gas bill and hits aggressive milestones. tough economy and the relatively peared to lose some ground to fixed- tracts and financial position of its in- should benefit more than 7.5 million By Pui-Wing Tam CFares Chief Executive Tom Ka- small size of Claremont Creek’s By Geoffrey A. Fowler price sites such as Amazon.com Inc., 400 formation-technology outsourcing di- homes. The company said it will linske says his company likely will fund, “that’s business.” some analysts said. “EBay is losing 300 vision since October, when it warned also introduce a “prompt payment OAKLAND, Calif.—Claremont be profitable by year end, based on At the same time, Claremont EBay Inc. reported a 31% slump in market share compared to other that rapid expansion and spiraling discount” of as much as £15 per year Creek Ventures recently had to de- the funding that already has been Creek persuaded some of its fourth-quarter profit and its first e-commerce players like Amazon,” 200 costs would hit full-year earnings. for customers on standard gas tariff cide which of its young to forsake. committed. Gene Security CEO Mat- A-graded companies to raise more quarterly revenue decline. said J.P.Morgan analyst Imran Khan. 100 For its fiscal third quarter ended Dec. who pay quarterly and will automati- The U.S. venture-capital firm thew Rabinowitz says his venture funds to survive the downturn. Revenue fell 6.7% as shoppers “They still have a lot of work to do.” 31, BT cut its expectations for earn- cally reduce payments by 10% for 0 had invested in such companies as capitalists “are bringing out the Gene Security CEO Mr. Rabinowitz pared holiday budgets and Shares of eBay fell about 4Q 1Q 2Q 3Q 4Q ings before interest, tax, depreciation customers who pay by direct debit. online travel site cFares Inc. and ge- best in us.” wasn’t planning to look for new shifted away from eBay’s 11%, or $1.48, to $11.80 in af- 2007 ’08 and amortization to £17 million be- Gas prices have fallen steadily in re- netic-technology start-up Gene Se- Many venture-capital firms, money last year. In October, Mr. core online auctions. EBay ternoon trading on the Nas- fore charges, specific items and cer- Source: the company cent months, save for a short in- curity Network Inc., with cash from which put money into start-ups Steuart, who is on the start-up’s indicated that conditions re- daq Stock Market Thursday, tain costs, down 92% from £215 mil- crease when Russian gas trans- a $130 million venture fund it with the aim of profiting when board, helped convince him to main uncertain in the cur- in the wake of the announce- lion last year. Further provisions are ported via the Ukraine to Europe launched in 2005. those firms go public or are sold, are speed up fund raising and raise rent quarter, issuing ranges ment late Wednesday. business. possible as the review continues. was temporarily cut off amid a dis- Amid the financial crisis and the going through a similar Darwinian more than enough cash for the com- for revenue and profit that John Donahoe, who has For the past year, Mr. Donahoe pute between the two countries. plunging stock market, Claremont exercise of sorting through their po- pany to beef up product develop- are below estimates on been eBay’s chief executive has pushed for eBay to sell more easyJet PLC Creek decided to focus on the fund’s tential winners and losers. While Gene Security ment and weather the recession. Wall Street. for a year, said he was fixed-price goods and changed the William Morrison Supermarkets best investments and stop backing the venture business enjoyed some- Employees work at Gene Security, a maker of genetic tests to identify potential Mr. Rabinowitz worked with Mr. While eBay said its on- pleased with the progress company’s fee structure. In the fall, Budget airline easyJet PLC said the less-promising start-ups. It thing of a revival in the past few embryo abnormalities. The company got high marks from backers. Steuart to find new investors. Ven- line payment and communi- the company has made to eBay said it would lay off about 1,000 fiscal first-quarter revenue rose U.K.-based William Morrison Su- wanted to be sure it had enough years, the financial crisis has ture-capital firm Alafi Capital last cations units grew, revenue turn around its flagging mar- full-time employees, or 10% of its 32%, boosted by passenger growth permarkets PLC Thursday reported cash for the next few years for the slowed the spigots of cash going month participated in a new $6 mil- in its core marketplace busi- John Donahoe ketplace business. “The work force. outside its U.K. home market, and a 7.7% rise in sales during the Christ- winners. The venture firm ranked into the sector. It also has crimped start-ups at a higher valuation than tember and then laid off two mem- lion funding round for Gene Secu- ness—which accounts for changes are not working For the fourth quarter, eBay re- added it expects fiscal first-half rev- mas period, outperforming rivals. the start-ups in the fund’s 16-com- returns by damping the market for in the past, though it accepted a bers of its 10-person team in Decem- rity at more than twice the valua- 55% of revenue—declined fast enough, but we are on the right ported earnings of $367 million, or enue to be ahead of previous fore- The company, which operates 382 pany portfolio with an A, B or C initial public offerings of stock and lower valuation for a financing ber. The stress sometimes led to ar- tion of the start-up’s previous fi- 16%. The company attributed the path,” he said. 29 cents a share, down from a $531 casts. However, in light of a difficult supermarkets, is benefiting from grade. for mergers. Meanwhile, many ven- round for a third start-up. guments between Mr. Steuart and nancing. drop to the strengthening dollar He also emphasized that the million, or 39 cents a share, a year macro-economic environment, the strong consumer demand for less-ex- “We’re doubling down on the As ture-backed start-ups are getting Pressure is on young venture- his two main partners, Randy Overall, Claremont Creek has given eBay’s large international expo- faster-growing nonauction portions earlier. For the fourth quarter, reve- airline said its forecast for the full pensive groceries in the wake of the and likely won’t invest any more cap- hurt as demand for their products capital firms like Claremont Creek, Hawks and Nat Goldhaber. Last trimmed $10 million a year in ex- sure, and the global slowdown. of the business are becoming as sig- nue was $2.04 billion, down from year remained unchanged, mainly economic downturn. For the six ital in the C companies,” says John shrinks. which have a shorter track record month, they brought in someone penses from its start-ups since Octo- Online retailers were spared nificant as the traditional core eBay $2.18 billion. because of uncertainty surrounding weeks ended Jan. 4, sales excluding Steuart, a Claremont Creek manag- As venture firms save their cash than older, better-known firms such Mr. Steuart calls “a corporate ber. While the firm once planned to the summer outlook and the poten- fuel rose 9.4% from a year earlier. In ing director. “The portfolio is com- for their most promising start-ups, as Sequoia Capital and Kleiner Per- shrink” to facilitate internal commu- invest in 20 companies with its tial impact from the strengthening stores open for at least a year, sales peting against itself and it’s survival it often means pulling the plug on kins Caufield & Byers. There were nication. 2005 fund, it now plans no new in- of the euro against sterling. The air- were up 6.6%, or 8.2% excluding fuel, of the fittest. It’s brutal.” weaker companies. 741 venture-capital firms in the U.S. As of last October, Claremont vestments so it has more cash for ex- line said it carried 10.1 million pas- Morrison said. The supermarket Gene Security, a fast-growing Claremont Creek took a pass on as of 2007, the most recent data Creek had deployed $44.3 million of isting start-ups. It has set aside $40 IBM employees buzz about layoffs sengers in the quarter ended Dec. chain reports full-year results on maker of genetic tests to identify po- putting more money into two start- available, according to the National the $130 million fund it launched in million for companies it will keep 31. Revenue increased to £550 mil- Feb. 1 and didn’t release any revenue tential abnormalities in embryos, ups in addition to cFares. Mean- Venture Capital Association. Many 2005. After an analysis showed its funding, up from less than $30 mil- By William M. Bulkeley An IBM spokesman declined to Mr. Loughridge said IBM last year lion ($769 million) from £418 mil- or profit figures. Freddie George, an got an A. Last month, Claremont while, it lined up bridge financings expect that number to drop as the fi- 16 portfolio companies were burn- lion previously. Mr. Steuart says Cla- comment on the reports. spent about $700 million on em- lion. Shares in easyJet were up 12% analyst at Seymour Pierce, said it is Creek poured $3 million into the for three others to get them through nancial crisis plays out. ing through more than $30 million a remont Creek has now made enough International Business Ma- In recent weeks, IBM employee ployee-restructuring actions. IBM de- in London trading Thursday. expected to become harder for the company on top of $2.7 million it most of 2009. Since October, the Claremont Creek finished rais- year, it quickly pushed some start- changes for many of its start-ups to chines Corp. employees have in- message boards have been full of clined to disclose how many people company to improve market share has already invested. firm raised new money for two of its ing a new $175 million fund in Sep- ups to cut costs. live to see 2011. formed Alliance@IBM, an affiliate of speculation over major layoff plans, were affected by restructuring last News Corp. in a more competitive market. the Communication Workers of with postings citing numbers as high year. IBM says it had about 400,000 America, that workers at a number of as 10,000 to 16,000 workers. employees at the end of 2008, up The New York headquarters of Remy Cointreau SA locations have been told their jobs A person familiar with IBM’s em- from 386,000 a year earlier. The Wall Street Journal was partly are being eliminated. ployment plans said the company Separately, IBM has switched the evacuated Wednesday after the French spirits company Remy Citigroup taps Parsons to succeed Bischoff as chairman Lee Conrad, national coordinator doesn’t expect numbers anywhere jobs of two of its most powerful se- newspaper received envelopes con- Cointreau SA Thursday posted a for Alliance, said that he has received near that large. He said the current nior vice presidents. taining a suspicious powder that 4.2% slide in revenue for the first By David Enrich larger role that the U.S. government Bank of America Chairman and J.P. Morgan disclosed that its Sir Win, 66, joined Citigroup a number of reports of people being action is similar to layoffs IBM Ginni Rometty, senior vice presi- preliminary testing later indicated nine months of its fiscal year and And Dan Fitzpatrick and U.S. taxpayers are playing in the Chief Executive Kenneth Lewis and chairman and CEO, James Dimon, when it bought Schroders PLC, informed that they are subject to makes every quarter as it pushes for dent, global business services, and was harmless. More than 200 em- warned that the global economic life of this institution.” several directors bought a total of bought 500,000 shares of the com- where he was chairman. After Citi- what IBM calls a “resource action.” efficiency and adjusts to changing one of IBM’s two highest-ranking ployees were evacuated while au- downturn and costs of reorganizing Citigroup Inc., under pressure In November, The Wall 513,000 shares of common pany’s stock last Friday, paying group CEO Charles Prince resigned He said that the reports are coming market demands for various skills. women, will become senior vice presi- thorities investigated. The powder its distribution network will hurt from shareholders and regulators, Street Journal reported in stock in the Charlotte, N.C., $22.93 each, for a total price of in November 2007, Sir Win was in- from people who work for the soft- On Tuesday, when IBM an- dent, global sales and distribution, in appears to be flour or another food- full-year recurring operating profit. named Richard Parsons as its new a Page One article that bank, which is reeling from about $11.46 million. J.P.Morgan de- terim CEO for one month and then ware group in applications develop- nounced record earnings on a slight charge of the company’s sales force. based substance, police officials Revenue for the nine months ended chairman, succeeding Sir Win some directors were con- worries about this month’s clined to comment. became chairman. He will step ment and marketing, among other sales decline, Mark Loughridge, chief Frank Kern, who has held the top said late Wednesday. The mailings Dec. 31 dropped to Œ604.5 million Bischoff. sidering replacing Sir Win, takeover of Merrill Lynch & Mr. Dimon and Citigroup’s deci- down from that position Feb. 23, functions. financial officer, said IBM expects re- sales job for a year, will take over the to the Journal, which is owned by ($786.9 million) from Œ630.9 mil- with Mr. Parsons a leading Co. Mr. Lewis paid $1.2 mil- structuring costs, which are prima- The change had been under dis- sion to make Mr. Parsons chairman won’t stand for re-election to the Alliance is trying to organize services job that Ms. Rometty has News Corp., coincided with one lion a year earlier, largely reflecting cussion for months by some Citi- candidate to become chair- lion for 200,000 common workers at IBM into a union. It rily severance-related, to be at nor- been in for almost seven years. were announced after the close of board and plans to retire from Citi- sent to Harvard Law School profes- the impact of the stronger euro and group directors who felt Mr.Parsons, man. In response, Citi- shares, buying blocks rang- regular trading Wednesday. doesn’t currently represent workers mal annual levels of between $300 —Sarah E. Needleman group this year. sor Alan Dershowitz that bore the destocking by wholesalers in Rus- already lead independent director of group said in a statement ing in price from $5.98 to Bank shares fell Thursday. Late for bargaining purposes. million and $400 million this year. contributed to this article. same postmark, of Knoxville, sia. Stripping out currency fluctua- Mr. Parsons recently has been the New York bank, would provide that the board “reiterated $6.06 a share. morning, Bank of America was Tenn., according to the Federal Bu- tions, revenue dropped only 1%. The stronger supervision of top manage- its full support” for Sir Win The purchases were down 13%, or 88 cents, to $5.80 on playing an increasingly active role reau of Investigation. The FBI is in- company, which sells high-end ment than Sir Win, an investment- and “looks forward to his made Tuesday and dis- the New York Stock Exchange after in overseeing Citigroup’s opera- vestigating links between the mail- champagne and cognac, said recur- tions. His elevation to chairman banking executive based in London. continued leadership.” Richard Parsons closed in a securities filing jumping 31% Wednesday. J.P. Mor- ings sent to the Journal and to Mr. ring operating profit for its full fis- In an interview, Mr. Parsons, the Citigroup’s announce- Wednesday afternoon. gan fell 4.5%, or $1.02, to $21.61, giv- comes less than a week after Citi- Intel plans to close several older factories Dershowitz, a person familiar with cal year is likely to drop 15%. Remy 60-year-old former chief executive ment came shortly after Bank of Bank of America wouldn’t comment ing back some of Wednesday’s 25% group announced an $8 billion the investigation said. Mr. Der- Cointreau shares ended down 9.8%. of Time Warner Inc., said the move America Corp. and J.P. Morgan on the purchases, including surge. Citigroup dropped 15%, or 56 fourth-quarter loss and plans to By Don Clark Paul Otellini told employees in an in- Intel said it will consolidate oper- showitz said he was told by authori- was logical “given the new direction Chase & Co. separately moved to whether Mr. Lewis paid for the cents, to $3.11, retracing much of downsize the battered company un- ternal Webcast that profitability in ations at factories that use older fab- ties that his mailing didn’t contain Deutsche Post AG in terms of the strategy and the shore up investor confidence. shares with his own money. Wednesday’s 31% rise. der CEO Vikram Pandit. Intel Corp. said it will close sev- the first quarter was too close to rication technologies. The cutbacks anthrax. eral older factories, displacing call. Intel hasn’t reported a net loss won’t affect plans to expand the use The former chief executive of 5,000 to 6,000 workers, as the com- since 1986. An account of Mr. Otelli- of current-generation processes or Bankinter SA Deutsche Post AG admitted Thurs- Advertisement [ INTERNATIONAL INVESTMENT FUNDS www.WSJ.com ] Advertisement pany reacts to a sharp drop in de- ni’s remarks was reported by newer processes that create ul- day in court that he evaded taxes by mand for its computer chips. Bloomberg News. trafine circuit widths, Intel said. Spanish lender Bankinter SA said squirreling money away in Liechten- Continued from previous page 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 The Silicon Valley company pre- fourth-quarter net profit rose 6.9%, stein. Klaus Zumwinkel is charged NAV — %RETURN — viously had expressed optimism FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR Andorfons Mix 30 EU BA AND 01/20 EUR 8.01 –1.1 –28.3 –17.2 HF-World Bds Abs Ret OT OT CHE 01/15 USD 71.48 0.0 –22.1 –7.8 n KREDIETBANK LUXEMBOURG as higher lending and trading in- with evading nearly Œ1 million Andorfons Mix 60 EU BA AND 01/20 EUR 7.85 –3.4 –35.2 –22.2 that prior job cuts would be suffi- Short Mat Dollar A US BD LUX 01/21 USD 6.79 0.4 –19.8 –10.5 www.kbl.lu Fax : +352 47 97 73 911 come, as well as lower costs, offset ($1.3 million) in taxes. On the open- Short Mat Dollar A2 US BD LUX 01/21 USD 8.83 0.8 –19.8 –10.5 n CHARTERED ASSET MANAGEMENT PTE LTD - TEL NO: 65-6835-8866 DSF 25/75 EU BA LUX 01/21 EUR 288.08 –1.3 –18.6 –10.2 cient to cope with the recession’s im- soaring loan-loss provisions. Net ing day of Mr. Zumwinkel’s trial, DSF 50/50 EU BA LUX 01/21 EUR 212.40 –1.7 –25.0 –15.3 EU urges Ritalin safety measures Short Mat Dollar B US BD LUX 01/21 USD 6.79 0.4 –20.2 –10.9 Fax No: 65-6835 8865, Website: www.cam.com.sg, Email: [email protected] pact on its business. But with a 90% profit rose to Œ50.5 million ($65.7 prosecutor Daniela Wolters told the Short Mat Dollar B2 US BD LUX 01/21 USD 8.82 0.7 –20.2 –10.9 CAM-GTF Limited AS EQ MUS 01/09 USD 138426.54 2.6 –47.3 –20.3 DSF 75/25 EU BA LUX 01/21 EUR 159.22 –1.9 –31.8 –20.8 Short Mat Dollar I US BD LUX 01/21 USD 6.79 0.4 –19.3 –10.0 KBC Eq (L) Europe EU EQ LUX 01/21 EUR 365.41 –6.0 –42.6 –32.1 drop in fourth-quarter earnings and ASSOCIATED PRESS about any family history of heart dis- million) from Œ47.3 million a year ear- Bochum state court that the 65-year- n DJE INVESTMENT S.A. KBC Eq (L) Japan JP EQ LUX 01/21 JPY 15184.00 –9.2 –41.1 –34.3 BRUSSELS—European Union internet: www.dje.lu email: [email protected] phone:+00 352 269 2522 0 fax:+00 352 269 25252 KBC Eq (L) NthAmer EUR US EQ LUX 01/21 EUR 427.05 –6.5 –37.8 –23.5 a downbeat outlook from computer ease. Specialists should check if lier, as net interest income jumped old avoided paying the money be- DJE Real Estate P OT OT LUX 01/22 EUR 10.03 –0.4 –0.9 –0.3 n HERMES FINANCIAL MANAGEMENT (EGYPT) LIMITED, [email protected] Eq (L) NthAmer USD US EQ LUX 01/21 USD 620.19 –6.5 –36.2 –21.6 makers, pressures increased to cut medical regulators said Thursday these patients should still use the 29% to Œ191 million. Revenue rose tween 2003 and 2007 with the help DJE-Absolut P GL EQ LUX 01/22 EUR 168.66 –3.8 –26.0 –15.2 Tel: 9714 363 4041 *Middle East & Developing Africa Fund KBL Key America EUR US EQ LUX 01/20 EUR 292.30 –8.3 –43.3 –26.2 that patients prescribed Ritalin and drug. Blood pressure and heart DJE-Alpha Glbl P EU BA LUX 01/22 EUR 148.89 –3.2 –19.9 –11.6 EFG-Hermes Egypt GL EQ BMU 12/31 USD 34.58 –46.2 –46.2 –6.7 KBL Key America USD US EQ LUX 01/20 USD 306.00 –8.1 –42.6 –24.7 costs further and improve the sag- 22% to Œ291.1 million, lifted by 6.8% of a Liechtenstein-based founda- DJE-Div& Substanz P GL EQ LUX 01/22 EUR 171.24 –2.1 –21.1 –13.0 EFG-Hermes MEDA* GL EQ BMU 12/31 USD 20.95 –42.1 –42.1 –6.7 KBL Key East Europe EU EQ LUX 01/20 EUR 993.08 –6.2 –68.5 –41.6 ging utilization of its factories. other similar hyperactivity drugs rates also should be monitored regu- DJE-Gold&Resourc P OT EQ LUX 01/22 EUR 128.67 –1.6 –30.5 –9.7 annual loan growth and wider lend- tion. “The accusations in the charge EFG-Hermes Saudi Arabia EquityEA EQ SAU 12/31 SAR 4.74 NS NS NS KBL Key Eur Sm Cie EU EQ LUX 01/20 EUR 613.86 –2.4 –46.9 –35.0 DJE-Renten Glbl P EU BD LUX 01/22 EUR 120.93 1.0 –0.8 0.5 shouldbescreenedforheartandpsy- larly during treatment, it said. n BANC INTERNACIONAL D'ANDORRA. BANCA MORA. EFG-Hermes Telecom OT EQ BMU 12/31 USD 25.64 –33.1 –33.1 –5.7 KBL Key Europe EU EQ LUX 01/20 EUR 498.26 –4.0 –36.8 –26.1 Intel said not all the affected em- ing margins. General, personnel and sheet are accurate,” Mr. Zumwinkel Avgd. Meritxell 96, Andorra la Vella. Andorra. Ph. +376.884884 www.bibm.ad LuxPro-Dragon I AS EQ LUX 01/22 EUR 90.88 –2.1 –37.5 –16.1 KBL Key Far East AS EQ LUX 01/20 USD 839.13 –7.0 –52.0 –24.9 chiatric problems before and after It also warned the drugs could LuxPro-Dragon P AS EQ LUX 01/22 EUR 88.79 –2.1 –38.4 –17.0 ployees, about 6% to 7% of its work administrative costs dropped 14% to told the court, adding that he had re- Andfs. Anglaterra UK EQ AND 01/20 GBP 6.44 –3.2 –25.2 –15.7 n HSBC ALTERNATIVE INVESTMENTS LIMITED KBL Key Major Em Mkts GL EQ LUX 01/20 USD 314.35 –8.3 –62.7 –28.9 LuxTopic-Aktien Europa EU EQ LUX 01/22 EUR 13.12 –8.4 –21.8 –11.6 they start treatment. The European Andfs. Borsa Global GL EQ AND 01/20 EUR 5.55 –4.4 –35.7 –22.9 KBL Key NaturalRes EUR OT EQ LUX 01/20 EUR 335.02 –1.6 –40.2 –17.7 force of 84,000, will lose their jobs. cause or worsen depression, sui- Œ126.4 million. Bankinter’s loan book paid the back taxes. Mr. Zumwinkel LuxTopic-Pacific AS EQ LUX 01/22 EUR 9.14 1.0 –52.2 –28.0 T +44 20 7860 3074 F + 44 20 7860 3174 www.hail.hsbc.com Andfs. Emergents GL EQ AND 01/20 USD 9.26 –7.4 –52.2 –23.5 HSBC Portfolio Selection Fund KBL Key NaturalRes USD OT EQ LUX 01/20 USD 329.29 –8.7 –47.2 –17.8 Some may be offered positions at Medicines Agency said the drugs, cidal thoughts, hostility, psychosis continued to deteriorate, with non- resigned last February after the alle- Andfs. Espanya EU EQ AND 01/20 EUR 9.90 –8.5 –37.5 –23.3 Sel Emerg Mkt Debt GL BD GGY 01/21 USD 246.17 0.3 –20.8 –8.9 Andfs. Estats Units US EQ AND 01/20 USD 11.67 –4.3 –34.8 –21.2 n LLOYD GEORGE MANAGEMENT (HK) LTD other factories.The cuts follow simi- which contain methylphenidate, and mania. Patients also should be Sel Emerg Mkt Equity GL EQ GGY 01/21 USD 120.23 –8.2 –49.2 –23.4 performing loans rising to 1.34% of gations came to light. Tax evasion Andfs. Europa EU EQ AND 01/20 EUR 6.02 –7.2 –40.0 –25.3 Sel Euro Equity EUR US EQ GGY 01/20 EUR 70.51 –5.4 –45.9 –31.5 Suite 3808, One Exchange Square, HK: Tel. 852 2845 4433 Fax. 852 2845 3911 lar moves across the technology in- were safe for use for treating chil- screened and monitored for psychi- Andfs. Franca EU EQ AND 01/20 EUR 7.59 –8.4 –40.3 –26.8 total loans by the end of December can carry a sentence of as much as Sel European Equity EU EQ GGY 01/21 USD 119.65 –13.0 –49.4 –32.0 LG Antenna GL EQ BMU 01/16 USD 32.39 –5.1 –56.8 –24.8 dren and adolescents over the age of Andfs. Japo JP EQ AND 01/20 JPY 408.39 –6.8 –39.1 –31.2 LG Asian Plus AS EQ CYM 01/16 USD 36.11 –4.4 –56.9 –20.4 dustry. Advanced Micro Devices Inc. atric symptoms during treatment. from 0.91% in September. Bankinter 10 years in prison in Germany, but Sel Glob Equity GL EQ GGY 01/21 USD 131.07 –8.7 –44.7 –29.5 Andfs. Plus Dollars US BA AND 01/20 USD 8.32 –1.3 –20.3 –10.8 LG Asian SmallerCo's AS EQ BMU 01/21 USD 52.07 –5.6 –63.0 –39.0 Sel Glob Fxd Inc GL BD GGY 01/21 USD 125.87 –2.4 –15.3 –4.8 last week said it was cutting 1,100 6whosufferfromattentiondeficithy- Methylphenidate is sold as a ge- Chief Executive Jaime Echegoyen penalties are usually lower. Andfs. RF Dolars US BD AND 01/20 USD 10.29 0.7 –10.1 –3.9 LG India EA EQ MUS 01/15 USD 29.92 –6.2 –68.6 –26.4 Andfs. RF Euros EU BD AND 01/20 EUR 9.10 1.6 –17.9 –10.2 n HERITAGE FUND MANAGEMENT Sel Pacific Equity AS EQ GGY 01/21 USD 80.16 –11.3 –47.7 –24.4 peractivity disorder, or ADHD. Siberian Investment Co EE EQ IRL 12/31 USD 16.23 –81.6 –81.6 –52.5 jobs and imposing temporary pay neric drug, and also under various said he expects credit to continue to Andorfons EU BD AND 01/20 EUR 12.16 2.0 –20.0 –12.5 [email protected] www.heritagefunds.ch Sel US Equity US EQ GGY 01/21 USD 94.24 –6.5 –38.2 –24.6 But it recommended that all pa- brand names, including Novartis Andorfons Alternative PremiumOT OT AND 11/30 EUR 94.24 –18.8 –18.7 –6.8 HF-China Abs Ret OT OT CHE 01/15 CHF 70.79 –0.8 –52.0 –21.6 Sel US Sm Cap Eq US EQ GGY 01/21 USD 121.73 –6.9 –39.6 –29.0 Please turn to next page cuts in response to the economic grow this year even if other banks slowdown. tients be checked for heart-rate or AG’s Ritalin and Johnson & rein in lending and the Spanish econ- —Compiled from staff For information about listing your funds, please contact: Peter Jennings, tel: +44-20-7842-9674; email: [email protected] or Carson Wong tel: +852 2831-6481; email: [email protected] Last week, Intel Chief Executive blood-pressure problems and asked Johnson’s Concerta. omy is in recession. and wire service reports. 8 FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 THE WALL STREET JOURNAL. THE WALL STREET JOURNAL. FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 21 ECONOMY & POLITICS THE INTERNATIONAL INVESTOR FUND SCORECARD Japan deflation fears rise Sector Equity Health Care Funds that invest primarily in the equities of companies in the mediacal and health-care in- Obama orders closing of Guantanamo rapidly conditions have worsened studying anticipated inflation dustries. At least 75% of total assets are invested in equities. Ranked on % total return (divi- BOJ cuts projections in the world’s second-largest econ- rates for the mid- and long term, dends reinvested) in U.S. dollars for one year ending January 22, 2009 omy because of the global slump. and “it doesn’t seem now that such Leading 10 Performers U.S. president also bans harshest interrogation methods as he moves swiftly to act on campaign pledges for growth, prices, Sharp falls in industrial output rates will fall sharply,” though the FUND FUND LEGAL % Return in $US ** and exports plus weak consumer BOJ will need to watch whether RATING NAME FUND MGM'T CO. CURR. BASE YTD 1-YR 2-YR 5-YR A WSJ NEWS ROUNDUP ministration also is planning a holds rates steady demand have some economists such expectations change. 3 UniSector: Union Investment EURiLuxembrg –4.07 –14.37–13.05–0.37 President Barack Obama, mov- study of more aggressive interroga- forecasting that Japan’s Real gross domestic BioPharma A Inc Luxembourg S.A. ing fast to implement a campaign By Megumi Fujikawa tion methods that could be added to economy might have product, meanwhile, is 5 ESPA Stock Erste Sparinvest EURiAustria –0.95 –15.51 –7.25 2.60 pledge, began overhauling U.S. treat- And Tomoyuki Tachikawa the Army manual—which would cre- shrunk at a double-digit an- now projected to fall by Pharma A Inc KAG ment of terror suspects Thursday, ate a significant loophole to Mr. nualized rate in the final 1.8% in the current fiscal signing orders to close the Guantan- Obama’s action Thursday. TOKYO—The Bank of Japan held quarter of 2008. Govern- year—compared with 0.1% 5 Seligson Glb Seligson & Co EURiFinland –2.71 –15.67 –7.16 2.59 amo Bay detention center, review Mr. Obama directed the Justice interest rates steady Thursday and ment data released Thurs- growth projected in Octo- Top 25 Pharma A AccRahastoyhtiö Oyj military trials and ban the harshest Department to review the case of Qa- unveiled steps to arrest deteriorat- day showed that exports ber—and by 2% in the fis- 4 Generali IS Generali EURiLuxembrg –2.79 –16.65–11.43 0.03 interrogation methods. tar native Ali al-Marri, who is the ing corporate finance conditions, dropped a record 35% cal year ending March Glb Life Science AInvestments Inc Sicav With three executive orders and only enemy combatant currently be- but cut its growth and price projec- year-to-year in December. 2010, compared with ex- 4 FIM Rohto Glitnir Asset EURiFinland –2.42 –16.70–11.10–0.48 a presidential directive, Mr. Obama ing held on U.S. soil. The review will tions so sharply that they raised Japan’s central bank pectations in October of a Acc Management Ltd started reshaping how the U.S. pros- look at whether Mr. al-Marri has the the prospect of deflation. forecast falling prices for 0.6% rise. 3 DKB Pharma BayernInvest EURiLuxembrg –0.63 –16.85–12.32 0.18 ecutes and questions al Qaeda, Tali- right to sue the government for his Governor Masaaki Shirakawa, the next two years. The central bank now Fonds Al Inc Luxembourg S.A. ban or other foreign fighters who freedom, a right the Supreme Court however, moved to reassure the It said it now expects Masaaki expects GDP to turn posi- 3 Bayern LB BayernInvest EURiLuxembrg –0.44 –17.90–13.24–0.39 pose a threat to Americans. already has given to Guantanamo de- market that Japan isn’t at risk of the core consumer-price in- tive again only in the fiscal Shirakawa Pharma Glb Fds ALLuxembourg Inc S.A. The centerpiece order would tainees. The directive will ask the plunging into a spiral of falling dex to fall by 1.1% in the fis- year ending March 2011, 4 Nordea Nordea Invest DKKiDenmark –2.35 –18.02–11.32–0.64 close the much-maligned U.S. high court for a stay in Mr. al-Mar- prices and demand. cal year ending March 2010, com- when the economy is projected to prison at Guantanamo Bay, Cuba, ri’s appeals case for the review. The “The possibility is low for now pared with its forecast of flat CPI in grow by 1.5%. Invest HealthCare Inc within a year, a complicated process government says Mr. al-Marri is an that Japan will enter a deflationary its semiannual outlook report re- Growth prospects for the fiscal 3 DWS Zürich DWS Investment EURiGermany –0.65 –18.26–12.99 0.11 with many unanswered questions al Qaeda sleeper agent. spiral,” the BOJ chief said after the leased in October. For the fiscal years ending in March 2009 and Invest Life ScienceGmbH Inc that was nonetheless a key cam- An estimated 245 men are being policy board voted unanimously to year ending March 2011, the core in- 2010 “have shifted significantly 3 Aktia Medica Aktia Rahastoyhtiö EURiFinland –3.03 –19.26–14.04–2.41 paign promise of Mr. Obama’s. The held at the U.S. naval base in Cuba, hold interest rates steady at 0.1%. dex is expected to fall 0.4% com- downward and the growth rates A Inc Oy administration already has sus- most of whom have been detained Still, the fact that Mr. pared with October’s prediction of are expected to be negative,” the NOTE: Changes in currency rates will affect performance and rankings. Source: Morningstar, Ltd pended trials for terrorist suspects for years without being charged Shirakawa mentioned a deflation- a 0.3% rise. central bank said in a statement ac- KEY: ** 2YR and 5YR performance is annualized 1 Oliver’s Yard, 55-71 City Road NA-not available due to incomplete data; London EC1Y 1HQ United Kingdom at Guantanamo for 120 days pend- with a crime. ary spiral at all underscored how Gov. Shirakawa said the BOJ is companying its rate decision. NS-fund not in existence for entire period www.morningstar.co.uk; Email: [email protected] ing a review of the military tribu- Mr. Obama’s actions Thursday Phone: +44 (0)203 107 0038; Fax: +44 (0)203 107 0001 nals. followed a busy first full day in of- “We intend to win this fight. fice Wednesday, when he an- We’re going to win it on our terms,” nounced a wage freeze for top White Mr. Obama said of the war on terror- Press Associated House staff and issued the strictest Property shares lead Tokyo higher Trustee seeks cancellation ism. But he also said he didn’t want President Barack Obama signed several orders Thursday, including one to close the Guantanamo Bay detention center. rules to date on lobbying activities to have to make a “false choice” be- for members of the administration. By Rosalind Mathieson on covered short-selling of financial ous three months. tween successfully waging war Mr. Obama met with his top per- And Chris Oliver stocks until March 6. National Aus- Hyundai Motor lost 2.9% as against terrorist organizations and hard,” the president said. Boehner, who was briefed on the In addition, Mr. Obama required sonnel in Iraq and national-security tralia Bank gained 2.8% and West- fourth-quarter net profit fell more of leases on Madoff cars hewing to U.S. human-rights ideals House Minority Leader John changes Wednesday. all U.S. personnel to follow the U.S. team and directed them to continue HONG KONG—Financial stocks pac Banking rose 3.3% sharply than expected. in the process. Boehner (R., Ohio) said in a state- Mr. Obama also created a task Army Field Manual while interrogat- planning a “responsible military gained across Asia on Thursday, re- Newcrest Mining fell 3.5% after LG Electronics shed 3.7% after it By Amir Efrati a home. “This is following through not ment that the Guantanamo prison force that would have 30 days to rec- ing detainees. The manual explicitly drawdown from Iraq,” a step toward covering from recent losses, and the company cut its output forecast. swung to a larger-than-expected Michael Cohen, who owns Silver just on a commitment I made during should remain open until serious ommend policies on handling terror prohibits threats, coercion, physical fulfilling one of his principal cam- real-estate developers were stand- South Korea’s Kospi Composite fourth-quarter net loss. The court-appointed trustee over- Star Auto Resource LLC in Queens, the campaign but an understanding questions are answered. “The key suspects who are detained in the fu- abuse and waterboarding, a tech- paign promises. He also signed two outs in Tokyo after the Bank of Ja- rose 1.1% to 1116.23. Gains were lim- Hong Kong’s Hang Seng Index seeing the liquidation of Bernard L. N.Y., said Mr. Madoff’s brother, Peter that dates back to our Founding Fa- question is where do you put these ture. Specifically, the group would nique that creates the sensation of executive orders and three presiden- pan released details of its plan to in- ited by data showing the economy firmed 0.6% to 12657.99 as trading Madoff Investment Securities LLC Madoff, who was a senior member of thers, that we are willing to observe terrorists? Do you bring them inside look at where those detainees drowning and has been termed a tial memoranda aimed at making ject liquidity into the economy. put in its worst performance in al- wound down before the Chinese on Wednesday asked a federal judge the Madoff firm, leased the Mercedes core standards of conduct—not just our borders? Do you release them should be housed since Guantan- form of torture by critics. However, government more transparent and Japan’s Nikkei Stock Average of most 11 years in the fourth quarter. New Year holiday next week. The to cancel leases the firm had on six S550V in 2006 for about $1,700 a when it’s easy but also when it’s back into the battlefield?” said Mr. amo is closing. a Capitol Hill aide says that the ad- tightening ethics rules. 225 companies firmed 1.9% to Gross domestic product fell a sea- market will be closed from Monday luxury cars, including three Mer- month. Mr. Cohen said he knew Peter 8051.74. Mitsub- sonally adjusted 5.6% from the previ- to Wednesday. cedes-Benz vehicles. Madoff because they are neighbors ASIAN-PACIFIC ishi Estate climbed The trustee, Irving Picard, who is in Old Westbury, N.Y., but hasn’t spo- 5.3% as part of a gathering the firm’s assets so they ken to him since the firm collapsed. STOCKS broad rally in the may be distributed to investors who Mr. Madoff, who is under 24-hour U.S. spy databases to be linked Senate panel approves real-estate sector Calpers taps investment chief were hurt by money manager Ber- house arrest pending trial or a guilty after the Bank of Japan said it will ac- nard Madoff’s alleged $50 billion plea after being charged Dec. 11 with By Siobhan Gorman emailing colleagues in other U.S. in- cept bonds issued by real-estate in- By Craig Karmin down in June to take an investment Ponzi scheme, wrote that the vehi- criminal securities fraud, “is no telligence agencies, because email ad- vestment trusts, or REITs, as collat- And Joann S. Lublin job in the private sector. The fund re- cles “are of no use or value to the longer actively conducting any busi- WASHINGTON—U.S. spy agen- dresses aren’t readily accessible, and Geithner for Treasury eral for loans. cently named the interim CIO, Anne creditors” of the firm and he wanted ness that requires the use of the vehi- cies’ sensitive data should soon be messages sometimes get eaten by se- Sony fell 2.6% as the electronics The largest U.S. public pension Stausboll, as chief executive. to cancel the leases to “minimize the cles,” Mr. Picard wrote. Mr. Picard re- linked by Google-like search systems, curity filters. Mr. McConnell aims to By Brian Blackstone that the Federal Reserve had failed firm said it would close one of two fund, known as Calpers, picked the Calpers said Mr. Dear, 57 years costs of administration in this case.” quested a bankruptcy-court hearing nearly five years after the intelli- solve that by uniting the agencies’ And Corey Boles to adequately oversee the risk that domestic TV manufacturing plants. top executive at Washington state’s old, has more than 20 years’ experi- The vehicles are: a 2007 Land for Feb. 4 before U.S. Bankruptcy gence community was rebuked by the email systems into a single system banks were taking on their books. After the market closed, it said it pension system as its new chief in- ence managing government organi- Rover Range Rover, a 2008 Cadillac Judge Burton R. Lifland, who will 9/11 Commission for failing to “con- with a full directory that links names, WASHINGTON—The Senate Fi- He pledged that any new tax- now expects a group net and operat- vestment officer. Joseph A. Dear, zations. Previous Calpers CIOs have DTS, a 2009 Mercedes S550-4, a consider Mr. Picard’s request. nect the dots” and detect the attack. expertise and addresses. nance Committee approved the payer money injected into banks or ing loss for this fiscal year. It also who has served as executive direc- at times clashed with its board over 2007 Mercedes S550V, a 2008 Mer- Mr. Picard recently said he al- Director of National Intelligence Linking up the 16 agencies is the nomination of Timothy Geithner as other financial institutions would cut its planned capital spending, cit- tor at the Washington State Invest- issues such as choosing certain in- cedes GL450 and a 2006 Lexus. A ready collected $29 million in assets Mike McConnell has launched a challenge at the heart of the job of U.S. Treasury secretary, clearing be done only after a full consider- ing a strong yen. ment Board since 2002, takes over vestment partners or avoiding in- court filing said five of the cars were from the Madoff firm and located an- sweeping technology program to director of national intelligence, cre- the way for the full Senate to con- ation of the risks in not acting. And In Sydney, the S&P/ASX 200 as CIO of the California Public Em- vestments in controversial areas. returned to New York City and Long other $830 million in assets at the knit together the thousands of data- ated after 9/11. Dennis Blair, nomi- sider Mr. Geithner’s confirmation. any financial firms receiving infu- added 1.3% to 3486.80. Banks ployees’ Retirement System in Some see Mr. Dear’s selection as a Island dealerships in late December; firm that may be subject to recovery bases across all 16 spy agencies. Af- nated by President Barack Obama to Mr. Geithner, who would lead the sions of taxpayer capital would be gained after the Australian Securi- March. Calpers, with about $182 bil- sign that Calpers is placing a pre- the Lexus was returned last week to and distribution among investors. ter years of bureaucratic snafus, in- succeed Mr. McConnell, had a Sen- Treasury Department as U.S. subject to much greater ties and Investments Commission, lion in assets, hasn’t had a perma- mium on relations between the a dealership in West Palm Beach, Mr. Picard has said he expects to lo- telligence analysts will be able to ate confirmation hearing Thursday. financial markets and the scrutiny, Mr. Geithner said. late Wednesday extended the ban nent CIO since Russell Read stepped trustees and the investment staff. Fla., close to where Mr. Madoff owns cate more assets. search through secret intelligence The new information program in- economy are facing the most Senate Finance Chair- cludes enhanced security measures serious turbulence in de- man Max Baucus said he files the same way they can search Advertisement [ www.WSJ.com ] Advertisement public data on the Internet. to ensure that only appropriately Press Associated cades, was approved by a hopes the full Senate will con- INTERNATIONAL INVESTMENT FUNDS Mr. McConnell’s new technology cleared people can access the net- Director of National Intelligence Mike vote of 18 to 5. sider Mr. Geithner’s nomina- NAV — %RETURN — NAV — %RETURN — NAV — %RETURN — program is also addressing a more ba- work. The price is expected to be in McConnell aims to unite email systems He told members of Con- tion “as soon as possible.” 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 sic problem: Spies often have trouble the billions of dollars, but much of at 16 agencies and the Pentagon by 2010. gress Thursday that he Mr. Geithner failed to pay Am Income B US BD LUX 01/21 USD 7.18 0.0 –11.7 –4.3 Eur Strat Value A EU EQ LUX 01/21 EUR 6.31 –9.3 –44.8 NS Gl Growth I GL EQ LUX 01/21 USD 33.13 –6.7 –49.7 –30.0 that money will be reallocated from backs Treasury’s longstand- payroll taxes on income re- Am Income B2 US BD LUX 01/21 USD 13.26 0.4 –11.7 –4.3 Eur Strat Value I EU EQ LUX 01/21 EUR 6.41 –9.3 –44.4 NS Gl High Yield A US BD LUX 01/21 USD 3.03 2.0 –29.0 –14.6 existing technology programs. ing commitment to a ceivedfromtheInternational Am Income I US BD LUX 01/21 USD 7.18 0.0 –10.5 –3.0 Eur Value A EU EQ LUX 01/21 EUR 6.61 –9.2 –42.4 –32.7 Gl High Yield A2 US BD LUX 01/21 USD 5.92 2.8 –28.9 –14.6 Gl High Yield B US BD LUX 01/21 USD 3.03 2.0 –29.8 –15.5 Data as shown is for information purposes only. No offer is being made by Am Value A US EQ LUX 01/21 USD 7.04 –2.4 –33.6 –22.1 Eur Value B EU EQ LUX 01/21 EUR 6.14 –9.3 –43.0 –33.4 The impact for analysts, Mr. Mc- 2001, attacks, and many intelligence strong U.S. dollar, and said Monetary Fund in 2001 and Am Value B US EQ LUX 01/21 USD 6.54 –2.5 –34.3 –22.9 Eur Value I EU EQ LUX 01/21 EUR 7.57 –9.3 –42.0 –32.2 Gl High Yield B2 US BD LUX 01/21 USD 9.61 2.8 –29.6 –15.4 Morningstar, Ltd. or this publication. Funds shown aren’t registered with the U.S. Gl High Yield I US BD LUX 01/21 USD 3.03 2.0 –28.5 –14.1 Connell says, “will be staggering.” agencies have botched their own the Obama administration then repeated the error in Securities and Exchange Commission and aren’t available for sale to United Am Value I US EQ LUX 01/21 USD 7.52 –2.3 –33.0 –21.5 Gl Balanced (Euro) A EU BA LUX 01/21 USD 11.94 –3.4 –32.3 NS Asian Technology A OT EQ LUX 01/21 USD 8.24 –5.8 –40.3 –28.9 Gl Balanced (Euro) B EU BA LUX 01/21 USD 11.75 –3.4 –33.0 NS Gl Value A GL EQ LUX 01/21 USD 7.61 –10.4 –50.0 –33.8 States citizens and/or residents except as noted. Prices are in local currencies. Gl Value B GL EQ LUX 01/21 USD 7.06 –10.4 –50.5 –34.5 Not only will analysts have vastly technology programs since 2001. thinks China manipulates Timothy Geithner three subsequent years. He Asian Technology B OT EQ LUX 01/21 USD 7.28 –5.8 –40.9 –29.6 Gl Balanced (Euro) C EU BA LUX 01/21 USD 11.88 –3.4 –32.6 NS All performance figures are calculated using the most recent prices available. Gl Value I GL EQ LUX 01/21 USD 8.03 –10.4 –49.6 –33.3 Asian Technology I OT EQ LUX 01/21 USD 9.12 –5.8 –39.8 –28.3 Gl Balanced (Euro) I EU BA LUX 01/21 USD 12.09 –3.3 –31.8 NS more data to examine, but poten- The program is likely to get a re- the value of its currency. apologized to the Finance NAV — %RETURN — India Growth A EA EQ LUX 01/16 USD 57.12 –1.1 –59.1 –15.8 Executive Travel Program Emg Mkts Debt A GL BD LUX 01/21 USD 11.71 0.5 –18.5 –7.1 Gl Balanced A US BA LUX 01/21 USD 12.58 –5.3 –34.3 –19.9 tially inaccurate intelligence will view from Mr. Blair. The new admin- The currency issue is a touchy one Committee Wednesday and said his FUND NAME GF AT LB DATE CR NAV YTD 12-MO 2-YR India Growth B EA EQ LUX 01/16 USD 49.29 –1.2 –59.5 –16.6 Emg Mkts Debt A2 GL BD LUX 01/21 USD 14.05 0.9 –18.5 –7.1 Gl Balanced B US BA LUX 01/21 USD 12.08 –5.3 –34.9 –20.7 India Growth I EA EQ LUX 01/16 USD 58.96 –1.1 –58.9 –15.5 stand out more clearly, he said. istration is expected to make sure it with China. U.S. officials have for mistakes were unintentional. Emg Mkts Debt B GL BD LUX 01/21 USD 11.71 0.5 –19.4 –8.1 Gl Balanced I US BA LUX 01/21 USD 12.96 –5.3 –33.9 –19.4 Int'l Health Care A OT EQ LUX 01/21 USD 115.63 –1.5 –27.7 –14.5 Today, an analyst’s query might is adequately funded, effective and years urged China to move to a mar- Separately,theWhiteHouse is ex- Emg Mkts Debt B2 GL BD LUX 01/21 USD 13.65 0.8 –19.4 –8.1 Gl Bond A US BD LUX 01/21 USD 8.49 –0.7 –4.5 0.3 Int'l Health Care B OT EQ LUX 01/21 USD 98.46 –1.6 –28.4 –15.4 Guests and clients of 320 Emg Mkts Debt I GL BD LUX 01/21 USD 11.71 0.5 –18.1 –6.6 Gl Bond A2 US BD LUX 01/21 USD 14.16 –0.4 –4.5 0.3 Int'l Health Care I OT EQ LUX 01/21 USD 125.39 –1.5 –27.1 –13.9 leading hotels and car scan only 5% of the total intelligence protects privacy. ket-based system and have ap- pectedtonominateChristineVarney, Emg Mkts Growth A GL EQ LUX 01/21 USD 18.56 –7.4 –54.4 –26.4 Gl Bond B US BD LUX 01/21 USD 8.49 –0.7 –5.5 –0.8 Int'l Technology A OT EQ LUX 01/21 USD 70.55 –3.6 –41.9 –23.3 data in the U.S. government, said a The first stage of the initiative is plauded steps China has taken in re- a former Federal Trade Commission Emg Mkts Growth B GL EQ LUX 01/21 USD 15.88 –7.4 –54.8 –27.1 Gl Bond B2 US BD LUX 01/21 USD 12.52 –0.4 –5.4 –0.7 Int'l Technology B OT EQ LUX 01/21 USD 61.71 –3.6 –42.5 –24.1 rental agencies receive Emg Mkts Growth I GL EQ LUX 01/21 USD 20.43 –7.3 –54.0 –25.8 Gl Bond I US BD LUX 01/21 USD 8.49 –0.7 –3.9 0.8 Int'l Technology I OT EQ LUX 01/21 USD 78.51 –3.5 –41.5 –22.7 The Wall Street Journal senior intelligence official. Under to merge the email systems of the six cent months to allow the yuan to ap- member and Internet-law expert, as n ALLIANCE BERNSTEIN Eur Blend A EU EQ LUX 01/21 EUR 8.58 –6.0 –41.2 –31.4 Gl Conservative A US BA LUX 01/21 USD 12.83 –2.7 –20.3 –10.2 Japan Blend A JP EQ LUX 01/21 JPY 4899.00 –8.7 –43.8 –34.3 the new system, an analyst would largest intelligence agencies, includ- preciate against the U.S. dollar. At the Justice Department antitrust chief, www.alliancebernstein.com/investments Tel. +800 2263 8637 Eur Blend I EU EQ LUX 01/21 EUR 8.77 –6.0 –40.7 –30.8 Gl Conservative A2 US BA LUX 01/21 USD 14.20 –2.6 –20.2 –10.2 Japan Blend I JP EQ LUX 01/21 JPY 5003.00 –8.7 –43.3 –33.8 Eur Growth A EU EQ LUX 01/21 EUR 5.42 –2.7 –38.0 –28.0 Gl Conservative B US BA LUX 01/21 USD 12.82 –2.7 –21.0 –11.0 Japan Growth A JP EQ LUX 01/21 JPY 5036.00 –9.5 –41.1 –33.5 Europe daily, courtesy of Am Blend Portfolio A US EQ LUX 01/21 USD 7.62 –7.2 –40.7 –26.5 likely search about 95% of the data, ing the Federal Bureau of Investiga- same time, China’s purchases of dol- people briefed on the move said. Jon Eur Growth B EU EQ LUX 01/21 EUR 4.92 –2.8 –38.6 –28.7 Gl Conservative B2 US BA LUX 01/21 USD 13.62 –2.6 –21.0 –11.0 Japan Growth I JP EQ LUX 01/21 JPY 5143.00 –9.4 –40.6 –33.0 Am Blend Portfolio I US EQ LUX 01/21 USD 8.90 –7.3 –40.2 –25.9 Eur Growth I EU EQ LUX 01/21 EUR 5.86 –2.8 –37.5 –27.5 Gl Conservative I US BA LUX 01/21 USD 12.86 –2.6 –19.7 –9.6 Japan Strat Value A JP EQ LUX 01/21 JPY 4747.00 –8.0 –46.6 –35.1 the official said. tion, the Central Intelligence Agency lar-denominated assets help keep in- Leibowitz, a current FTC member, is Am Growth A US EQ LUX 01/21 USD 21.86 –4.5 –31.0 –17.4 Eur Income A EU BD LUX 01/21 EUR 5.15 1.4 –20.9 –12.2 Gl Eq Blend A GL EQ LUX 01/21 USD 8.17 –8.6 –50.0 –32.1 Japan Strat Value I JP EQ LUX 01/21 JPY 4836.00 –7.9 –46.1 –34.5 Several similar efforts have been and the NSA. That’s on track to be terest rates low in the U.S. the leading candidate for commis- Am Growth B US EQ LUX 01/21 USD 18.56 –4.6 –31.7 –18.2 Eur Income A2 EU BD LUX 01/21 EUR 9.38 1.8 –20.8 –12.2 Gl Eq Blend B GL EQ LUX 01/21 USD 7.74 –8.6 –50.5 –32.8 Real Estate Sec. A OT EQ LUX 01/21 USD 9.43 –11.6 –46.2 –37.9 Real Estate Sec. B OT EQ LUX 01/21 USD 8.70 –11.7 –46.8 –38.5 Am Growth I US EQ LUX 01/21 USD 24.05 –4.5 –30.5 –16.7 Eur Income B EU BD LUX 01/21 EUR 5.15 1.4 –21.5 –12.9 Gl Eq Blend I GL EQ LUX 01/21 USD 8.55 –8.6 –49.6 –31.6 aborted in the past decade, because largely completed by the end of the Mr. Geithner said he was “deeply sion chairman, these people said. Real Estate Sec. I OT EQ LUX 01/21 USD 10.06 –11.6 –45.8 –37.3 Am Income A US BD LUX 01/21 USD 7.18 0.0 –11.1 –3.6 Eur Income B2 EU BD LUX 01/21 EUR 8.78 1.7 –21.4 –12.9 Gl Growth A GL EQ LUX 01/21 USD 30.06 –6.8 –50.1 –30.5 cultural divides couldn’t be bridged month, a senior official said. By 2010, concerned”aboutthestateofregula- —Patrick Yoest and Am Income A2 US BD LUX 01/21 USD 15.29 0.5 –11.1 –3.6 Eur Income I EU BD LUX 01/21 EUR 5.15 1.4 –20.4 –11.7 Gl Growth B GL EQ LUX 01/21 USD 25.33 –6.8 –50.6 –31.2 Please turn to next page www.accessmba.com between rival agencies. Some of all the agencies and the Pentagon tion and supervision of large finan- John R. Wilke contributed those efforts predated the Sept. 11, would have a single email system. cial institutions. He said it was clear to this article. For information about listing your funds, please contact: Peter Jennings, tel: +44-20-7842-9674; email: [email protected] or Carson Wong tel: +852 2831-6481; email: [email protected] 20 FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 THE WALL STREET JOURNAL. THE WALL STREET JOURNAL. FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 9 MONEY & INVESTING ECONOMY & POLITICS

CAPITAL JOURNAL n AIG hits trouble in Asia Russia’s Bank VTB posts U.S. envoy warns on Iraq GERALD F. SEIB that AIG eventually will be forced to a surprisingly deep loss Efforts to sell stake sell a majority stake in the business Early withdrawal Calling on conservatives, because few potential buyers will be By Andrew Langley “This is another example of in life unit are hurt willing to spend that amount of cash loan quality deteriorating across by U.S. raises risk Obama demonstrates his strategy without gaining control. The sale of MOSCOW—Russian lender OAO the sector and banks getting ag- by region’s downturn AIA is being managed by Citigroup Bank VTB reported a worse-than-ex- gressive in response,” said David of al Qaeda revival couple of times in recent make common cause from time to Inc. and Goldman Sachs Group Inc. pected third-quarter net loss Thurs- Nangle, an analyst at Moscow- A weeks, the personal cell- time, despite ideological divides. By Rick Carew AIG Chief Executive Edward day, highlighting the rise in nonper- based investment bank Renais- By Gina Chon phone of Sen. Tom Coburn of Liddy, who took the top job as part forming loans triggered by the coun- sance Capital. Oklahoma rang, and a baritone s a former senator himself, HONG KONG—American Inter- of a U.S. government bailout of the try’s economic downturn. London-listed VTB, Russia’s BAGHDAD—U.S. Ambassador voice on the other end asked sim- A the president has ties he can national Group Inc. faces hurdles in insurance company, faces pressure Other Russian lenders are also second-biggest lender after OAO Ryan Crocker said Thursday that a ply, “You know who this is?” use. He has a good relationship, its effort to sell a minority stake in to get a high price for the assets as expected to set aside more cash to Sberbank, posted a net loss of precipitous withdrawal of Ameri- Mr. Coburn did indeed know by for example, with Robert Bennett its pan-Asia life-insurance business, the government’s overall aid efforts cover possible bad loans, which is $369 million for the three months can troops from Iraq could give al the sound of the voice. The caller of Utah and Judd Gregg of New a cornerstone of its divestment pro- swell. He flagged plans to meet with likely to strain their capital ratios ended Sept. 30, compared with a Qaeda in Iraq a chance to regenerate was President-to-be Barack Obama, Hampshire, both fiscal conserva- gram to repay the U.S. government. potential buyers of the AIA unit this in the months ahead. year-earlier net profit of $555 mil- and leave the country vulnerable to dialing up to chat about what the tives with reputations for foster- As Asia’s economies worsen and month in New York at a Hong Kong Analysts say an increase in lion. possible negative interference from senator calls “spiritual things,” and ing good ties with Democratic col- doubts linger over the attractive- news conference in mid-December. loan defaults is inevitable, with VTB said provisions for bad neighboring nations. then some policy issues facing the leagues. Mr. Gregg already has ness of its pro- At the time he said AIG would take credit markets still largely frozen loans more than tripled between Mr. Crocker, who is retiring new administration. been helpful to the new president, DEALS & posed sale struc- its time weighing offers for the AIA both at home and abroad and the July and September to $788 mil- next month, declined to talk in de- The exchanges might seem un- speaking out in favor of, and then ture, AIG is ramp- unit in order to avoid a “fire sale.” government now forecasting a con- lion. It said the figure would con- tail about his discussion on remarkable, except for the ex- voting for, releasing unspent DEAL MAKERS ing up the auction Bloomberg News/Landov A sale would be one of the big- traction in the economy in 2009. tinue to rise, with nonperforming Wednesday with President Barack treme odd-bedfellow nature of the money from the financial-system process for as American International Group Inc. gest mergers-and-acquisitions Finance Minister Alexei Kudrin loans reaching 2.1% by October. Obama as part of a national-secu- Democratic president and the Re- bailout fund so it could be used much as a 49% stake in its Asian life- wants to sell a minority stake in its deals in Asia. It has attracted strong said this week that the govern- The agriculture and construction rity staff meeting on Iraq. Presi- Press Associated publican senator he was calling. by the Obama administration. insurance arm outside Japan, Asian life-insurance business, the interest from bankers at a time ment could inject as much as $40 sectors in particular are under con- dent Obama has asked his adminis- A U.S. soldier secures the area where a roadside bomb exploded in Baghdad on Mr. Coburn is among the most And there is Mr. Coburn. “We known as American International American International Assurance Co. when the flow of capital into the re- billion in fresh capital into state siderable pressure, the bank said. tration to look at options for with- Tuesday. Two civilians and three guards were injured in the blast, police said. conservative lawmakers in town, consider each other friends,” he Assurance Co., or AIA, people famil- gion from U.S. and European compa- banks such as VTB and larger rival “We consider this prudent and drawing American combat troops having won three straight 100% says in an interview. “Not iar with the situation said. nies is slowing and many large OAO Sberbank this year. expect the situation to worsen,” within 16 months. In a security annual ratings from the American friends like everybody in the Sen- Last fall, when AIG first dis- Mr. Garg believes AIA’s busi- Asian investors, such as sovereign- State-owned VTB has seen its Chief Financial Officer Nikolai agreement last year, the U.S. and reversible.” said Mr. Crocker, whose successor Conservative Union for his votes ate says, but real friends.” closed plans to sell the assets, bank- nesses in individual markets “could wealth funds China Investment loan book swell since the govern- Tsekhomsky said. Iraq agreed to a pullout by the end Mr. Crocker said there has been has yet to be named. “They are not in the Senate. Mr. Obama, by con- Mr. Coburn is a blunt-speak- ers valued the entire AIA business be an interesting business [for local Corp. and Temasek Holdings Pte. ment tasked lenders under its con- He added that VTB may seek to of 2011. remarkable progress in Iraq, with going to be perfect but they need to trast, got an 8% lifetime rating ing, unapologetically conserva- at more than $20 billion. firms] to acquire if they sold coun- Ltd., have been hurt by investments trol with providing much-needed raise its Tier 1 capital ratio, a key The ambassador said a with- violence at its lowest level in years. be credible.” from the conservative group for tive Oklahoma family physician That figure has come under try by country.” overseas. credit to Russia’s economy. measure of financial strength, in the drawal that was too swift could Iraqi security forces have taken on With security improving, the his Senate voting record. who was a member of the 1994 doubt, according to people watching AIG spokeswoman Patricia Chua Interest was expected to come The bank’s lending expansion— second half of the year,pending a de- have a chilling effect, mak- more responsibility and ambassador said Iraqi officials Yet the new president has iden- class of House Republicans that the auction process, as well as out- declined to comment on hurdles. from such funds, as well as from fueled most recently by a $6 bil- cision from the government, which ing Iraqis less willing to Prime Minister Nouri al- have been forced to focus more on tified the Oklahoma Republican as stormed to power behind Newt side observers. Financing is difficult “AIG remains focused on inviting Asian insurers and Western rivals. lion subordinated credit from owns a 75% stake. make political compro- Maliki has shown courage political issues, such as the proper a conservative he can work with, Gingrich to take over that cham- to find, and many of the sovereign- strategic investor(s) to take a minor- Potential buyers for AIA include Pru- state development bank VEB— VTB’s Global Depositary Re- mises and focus on institu- in implementing a crack- role of the federal government and which says much about the presi- ber. He retired from the House wealth funds that might have been ity interest in AIA,” she said in a dential PLC of the U.K., Prudential Fi- should help its profit grow. But ceipts fell 14% to $1.34 in London, ex- tional development. He down on militia members its relationship with the semiauto- dent’s style and strategy. The rela- in 2001, then retuned to Con- interested have been burned by statement. “The divestment is be- nancial Inc. of the U.S. and a number analysts warn that an expected tending morning losses after Chief added that Mr. Obama has of his own Shiite sect, Mr. nomous region of Kurdistan. In re- tionship also illustrates some of gress by winning a Senate seat Western investments. AIG said it is ing conducted in a smart, disci- of Asian insurers. Potential bidders deterioration in corporate loan Executive Andrei Kostin told a con- emphasized a responsible Crocker said. cent months, tensions have risen the limits of Mr. Obama’s in 2004—the same year determined to keep the assets to- plined and competitive process. are attracted to the business because quality will offset the gains some- ference call the bank would “do withdrawal. Mr. Crocker A test will come at the between Arabs and Kurds over ter- oft-professed desire to one Barack Obama was gether rather than sell them piece- There is no intention to sell AIA on a of its strong franchise across Asia. what. well” to break even in 2008. said he didn’t think the end of January, when Ira- ritorial disputes in northern Iraq. find common ground with elected from Illinois. meal, with lower prices. piecemeal basis.” “We continue to monitor AIG’s dis- new administration would qis are slated to vote for lo- Disagreements between the two political opponents. The two found com- At the same time, the outlook in AIG still could obtain a full posal program,” said Chad Tendler, a make the mistake of pull- cal government councils in groups over how to govern Iraq’s Mr. Obama proclaimed mon cause by uniting to export-dependent Asia is souring, price for the assets because of spokesman for Prudential of the U.K. ing out U.S. combat forces 14 of the country’s 18 prov- oil industry continue to hold up an often in his campaign, push through a bill de- reducing the flexibility of local in- their breadth and quality. Industry The ranks of potential local buy- before the time is appro- Ryan Crocker inces. In recent days, sev- oil law. and then again in his tran- signed to stem the surers. The industry’s regional executives said building an equiva- ers have thinned. Last October, Ping EU clears way for Germany priate. eral candidates have been “Progress has been signifi- sition and inaugural ad- spread of earmarks, growth rates are down because lent network of 200,000 agents in An Insurance (Group) Co. of China “Anything can happen [in assassinated but the widespread vi- cant,” Mr. Crocker said. “But we dress, his intention to be those legislative provi- many Asian insurers drew their the 15 markets AIA serves would Ltd., reported a third-quarter net Iraq],” Mr. Crocker told reporters. olence some expected hasn’t bro- can’t underestimate the chal- a post-partisan leader, sions that funnel money growth in past years from selling be a monumental task. Asia also is loss of 7.81 billion yuan ($1.14 bil- to guarantee bank deposits “That’s why my mantra has been ken out. “It’s very important that lenges and the time it will take to transcending the partisan to lawmakers’ specific consumers investment products seen as a long-term growth mar- lion) on a 15.7 billion yuan mark-to- that things are still fragile and still they be perceived as free and fair,” work through those.” divides and squabbles pet projects. Their bill rather than conservative insurance ket, as affluence leads to greater market loss on its 5% holding in For- A WSJ NEWS ROUNDUP missioner Neelie Kroes. that have marked Wash- Tom Coburn aimed to reduce the use products, said Sunil Garg, an ana- consumer appetite for insurance. tis NV. The company has said it will BRUSSELS—European Union reg- The German Special Fund for Fi- ington in the past decade of earmarks by casting a lyst at J.P. Morgan Chase & Co. Some potential buyers argue focus on the domestic market. ulators cleared Germany’s Œ6.7 bil- nancial Market Stabilization will or two. What that means, in practi- harsher spotlight on them, creat- lion ($8.72 billion) guarantee for a provide the collateral for a Œ6.7 bil- cal terms, is that he must find Re- ing a public, searchable online banking-industry program to cover lion bond issued by the banking in- Kennedy drops quest for Senate seat publicans with whom he can work database listing the recipients of deposits at private banks, including dustry’s Deposit Protection Fund to on a reasonably regular basis. all federal spending. the German branch of collapsed U.S. a group of German private banks. By Suzanne Sataline It’s unclear whether Ms. consuming political observ- A tie was formed, and the AIG loses star power in core units investment bank Lehman Brothers This will secure all customer de- And Dionne Searcey Kennedy would have even ers in New York state. One he problem is that the ranks president-elect kept it alive by Holdings Inc. posits at private banks up to 30% been Gov. David Paterson’s of the leading candidates T of the Republicans most reaching out to Mr. Coburn dur- By Liam Pleven Turnover isn’t surprising in a facing layoffs, AIG has been criti- The European Commission, the of liable capital. It also will com- Caroline Kennedy abandoned choice, as he recently began appears to be New York At- likely to find common ground ing the transition. “We have a lit- company that has roughly 116,000 cized over the bonuses. EU’s executive arm, said Thursday pensate depositors of Lehman her quest for New York’s vacant sen- stressing the importance of torney General Andrew with a Democratic president—that tle talk about spiritual things, American International Group employees. An AIG spokeswoman High-profile departures in re- that the government subsidy was Brothers Bankhaus AG, the Ger- ate seat when she discovered a “per- naming someone who had Cuomo, whom Gov. Pater- is to say, moderate Republicans— and then we’ll talk about other Inc. continues to lose key executives says, “Commercial insurance has a cent months include Kevin Kelley necessary to keep the banking sec- man subsidiary of the U.S. invest- sonal situation,” unrelated to her ill an economic plan, given the son said Tuesday was have been decimated in recent things, things he wants to talk and underwriters to competitors in strong and deep talent pool with and Doug Worman, who headed tor stable and prevent a disturbance ment bank, which collapsed in Sep- uncle, Sen. Ted Kennedy, that would woes facing both his state among his possible choices. years. They have retired, lost about,” including the use of its core business that is meant to be more than 12,000 employees in businesses in AIG’s commercial- in the German economy. tember. have prevented her from carrying and the U.S. He and other Gov. Paterson also is said their seats to Democrats or been those financial-market rescue preserved for shareholders as other North America alone, and turnover property-casualty operations. “The commission’s very rapid de- The bond issue will allow the De- out the job, an aide said. governors are competing to like the idea of having a supplanted by more-conservative funds, Mr. Coburn says. Ironi- units are readied for sale. rates are within normal levels.” Mr. Kelley went to Ironshore cision supports the German authori- posit Protection Fund to pay com- Her reason for withdrawing is as for congressional bailout woman succeed Mrs. Clin- Republicans. At this point, the sen- cally, it’s the kind of outreach the Dozens of employees have left Some analysts say the high- Inc., a Bermuda insurer, where he ties’ efforts to stabilize financial pensation before it manages to sell surprising as her decision in Decem- money, and having two sen- Andrew Cuomo ton. That raises the pros- ators who fit the traditional de- senator says he never got from the insurer’s property-casualty level nature of the departures is un- has since been joined by two other markets,” said Competition Com- off Lehman’s assets. ber to seek the seat being vacated ators who know how to pull pect that he could appoint scription of “moderate Republi- the just-departed president of his units since the federal rescue of usual. Josh Shanker at Citigroup former AIG executives. Mr. Kelley by Hillary Clinton, the new secre- strings would be vital. Randi Weingarten, president of the can” could meet in a phone booth. own party, George W. Bush. AIG in September. They have gone cited recent employee departures led one of AIG’s most lucrative tary of state. The aide declined to The decision by the daughter of American Federation of Teachers, or “Barack is a smart, smart oper- to major competitors such as Zur- from AIG’s commercial-insurance commercial-insurance units, Lex- elaborate on Ms. Kennedy’s reason. late President John F. Kennedy to Rep. Kirsten Gillibrand or Rep. Caro- Gone are such relative moder- ator,” Mr. Coburn says. “He’s go- ich Financial Services AG and ACE operations as among the factors ington Insurance Co. That unit had Sen. Kennedy is being treated for a end her candidacy heightened the at- lyn B. Maloney, two congresswomen ates as William Roth of Delaware, ing to be loath to make enemies.” Ltd., as well as smaller firms, ac- that he said “will likely result in a income of $1.5 billion on about $5 Euroclear’s single platform malignant brain tumor. mosphere of handicapping that is who have some financial experience. Lincoln Chafee of Rhode Island, Mr. Coburn thinks the new pres- cording to Advisen Ltd., which decline in account volume over the billion in premiums earned in Gordon Smith of Oregon and Pete ident will be able, in particular, to tracks the insurance industry. next two to five years,” in a re- 2007,according to A.M. Best Co., a Domenici of New Mexico. Also work with him and other conserva- The losses could be especially search report this month. ratings service, which said Lexing- launches for three countries gone are generally conservative tives on measures to make govern- painful for the property-casualty AIG has long encouraged top- ton was the U.S.’s largest seller of members who crossed lines to ment more transparent and to elim- units that cater to commercial cus- level executives to stay by award- medical malpractice insurance. By Adam Bradbery with demands from the European Near-term lift of U.S. stimulus plan in doubt work with Democrats on specific inate programs. Yet Mr. Coburn, tomers, a part of the business ing stock that accumulates over After Mr. Kelley’s departure Commission, the European Union’s issues, such as Chuck Hagel of Ne- despite his fondness for the new where client relationships are key. the years and is distributed at re- was announced last year, John LONDON—Euroclear, a com- executive branch, for trade-process- By Greg Hitt before the end of fiscal 2010. The the high cost of it versus the jobs cre- braska. The Senate’s most promi- president, also voices deep doubts “They have the bodies there to tirement. That incentive was un- Doyle, the CEO of AIG’s commercial- pany specializing in the settlement ing companies to reduce the cost of And Naftali Bendavid CBO said the balance would likely be ated,” said Michigan Rep. Dave nent remaining Republican mod- about the giant economic stimulus underwrite the business,” says dercut when AIG’s share price cra- insurance operations, said in an in- of euro-zone stock and bond transac- cross-border trading in the EU. spent over the next several years, af- Camp, the senior Republican on the erates are Maine’s Olympia package the administration is push- Dave Bradford, the head of re- tered last year. terview that he was “disappointed” tions, said Thursday it has launched The company plans to create a WASHINGTON—As U.S. Presi- ter the recession is projected to end. House Ways and Means Committee. Snowe and Susan Collins. ing. The initial version floated in search and editorial at Advisen. AIG has been setting up reten- but that AIG has a “deep bench.” a single platform for settling Bel- broader single platform, which dent Barack Obama’s $825 billion Republicans said the analysis Nadeam Elshami, a spokesman Similarly, in the House, there the House has, in his view, too “What they’ve lost is really the tion programs that will pay $619 Rodney Clark, an analyst at Stan- gian, Dutch and French securities. would include its U.K. and Irish set- economic-recovery package began shows that the package, which Dem- for House Speaker Nancy Pelosi, isn’t a single Republican left in the much wasted spending that won’t star power and the relationships.” million to 4,200 employees. Bo- dard & Poor’s, has cited AIG’s bench The launch means the compa- tlement houses and international making its way through Capitol Hill, ocratic leaders drew up with top said the CBO report creates a “false delegations of the six New England stimulate the economy and too few Since AIG received a massive nuses range from $92,500 to $4 strength. Two months ago, the rat- ny’s customers will be able to reap settlement house Euroclear Bank, analysts suggested a key plank may Obama aides, wouldn’t create the impression” by not taking “into ac- states, the traditional wellspring of permanent tax cuts. loan from the government in the million, according to a December ings company said it expected the savings available from reduc- by 2010-11. Shortly after that, the not provide as big a near-term lift as promised jobs. “Clearly, we’re not count the fastest-spending provi- moderate Republicans. The last “I’m not sure the stimulus is fall, it has been attempting to sell letter from Rep. Elijah Cummings some losses of business lines and ing the separate back-office opera- company will add Euroclear Swe- expected. talking about a stimulus bill,” said sions of the bill,” such as measures such Republican departed when going to do anything,” he says. “I units to repay it. But it intends to (D., Md.) to AIG’s new chief execu- personnel but that if the losses tions they have for each market- den and Euroclear Finland to the The nonpartisan Congressional Virginia Rep. Eric Canto. Republi- that would release tens of billions of Connecticut moderate Christopher think I’ll be happy to vote against keep its property-casualty insur- tive, Edward Liddy. were “significant and threaten fu- place and using one set of operat- system. Budget Office projected less than cans asked for a meeting with Mr. dollars to help pay for jobless bene- Shays lost his seat in November. it if there’s $700 billion in wasted ance units largely intact in the re- But at a time when the com- ture business prospects,” it could ing procedures. Euroclear says it believes this half of the $355 billion that House Obama to discuss alternative mea- fits and health care for the poor, and The upshot: If Mr. Obama spending.” Thus does the Obama- maining company, in which taxpay- pany is benefiting from a $150 bil- lower AIG’s credit ratings. “We The company said the creation of harmonized platform could save Democrats want to spend on high- sures that could be applied, includ- tax cuts for middle-class families. wants to work with Republicans, Coburn relationship define both ers got an 80% stake in exchange lion overall government aid pack- don’t think it’s risen to that level its Euroclear Settlement of Euronext- customers Œ350 million ($455 mil- ways, bridges and other job-creat- ing additional tax cuts. “These provisions will go out quickly he’s going to have to find genuine the possibilities, and the limits, for the bailout. age and many other Americans are yet,” he said in a recent interview. zone Securities platform is in line lion) a year. ing investments is likely to be used “There’s some real concern about to give the economy a jolt,” he said. conservatives with whom he can of the new era of outreach. 10 FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 THE WALL STREET JOURNAL. THE WALL STREET JOURNAL. FRIDAY - SUNDAY, JANUARY 23 - 25, 2009 19 ECONOMY & POLITICS MONEY & INVESTING THE MART Doctor-owned LETTER FROM THE CITY BUSINESS CONNECTIONS China’s new year brings job doubts hospitals face News and insights from London’s financial center For Cai Qin, a 35-year-old factory nancial assistance for those who doesn’t signal lawmakers’ opposi- Many migrants worker from a village in China’s im- Rural pillar want to start their own businesses. Bailout’s critics tion to the bailout, the criticism poverished southwestern province Experts warn, however, against by the panel puts the government Migrants' income has become a curbs in House go home to discover of Guizhou, Spring Festival has been predicting massive unrest. Chinese raise their voices on the defensive about the use of key part of getting by in China's a joyous family occasion ever since peasants are resilient and have an in- By Barbara Martinez taxpayer money to rescue banks countryside. Growth of wages as Committee seeks details safety net is fraying she set out with her husband for the formal network of help, ranging and could lead to greater disclo- a percentage of per capita rural coast seven years ago. The couple’s from extended families to strong in- on government liability sure about how funds are used. household income: A bill making its way through By Ian Johnson combined wages have risen to 2,000 formal obligations in villages for the Congress to provide more low-in- in rescue of banking sector The Treasury had no immedi- And Loretta Chao yuan, or $292, a month. 40% wealthy to help out the poor. “It will come children with health-insur- ate comment on the report. But this year, their homecoming be a very difficult time,” says Wang ance coverage could spell financial By Laurence Norman So far, opposition to the bank- BEIJING—As some 200 million has been bittersweet. The toy factory Chunguang, an expert on migration trouble for scores of hospitals ing-sector support in the U.K. has or more migrant laborers head near Hong Kong where Ms. Cai and 30 at the Chinese Academy of Social Sci- owned by physicians. t isn’t only Washington where beentamewhencomparedwithop- home this weekend to celebrate the her husband worked closed in No- ences, “but I don’t expect serious The number of doctor-owned Ilawmakers are growing in- position in the U.S., where voters Lunar New Year, they are facing an vember, sending the couple home problems with social instability.” hospitals has tripled to about 200 creasingly upset about the use of and many congressional lawmak- unprecedented crisis: unemploy- early. In previous years, they would 20 At the Beijing West Railway Sta- since 1990, but they have long been taxpayer money to bail out banks. ers have railed against the plan. BUSINESS OPPORTUNITIES ment and a fraying safety net. return with clothes and other gifts, tion on Wednesday, migrant work- mired in controversy. Supporters In stiff-upper-lip Britain, an- In the U.K., the October bank- The annual holiday is a time for but this time they arrived empty- ers waiting for trains to go home for say these hospitals, which often fo- ger is too strong a word, but an rescue package initially was well- far-flung families to gather to- handed. “We don’t know what to do 10 the New Year were optimistic, even cus on one or two lucrative services, influential group of lawmakers received by the public. A poll con- gether, look back over the past year after the holidays,” Ms. Cai said. “Our though they anticipate having much such as cardiac care or orthopedics, UPPA/Photoshot INVITATION TO BID 1985 ’90 ’95 2000 ’05 ’07 are making blunt demands for ducted by YouGov showed 59% of and plan for the future. For rural Chi- heads hurt just to think about it.” more difficulty finding new jobs are highly efficient, saving expenses greater accountability over the Michael Fallon is leading the push for voters supported the plan, versus Due Diligence on Bidders on Logging Concessions Source: National Bureau of Statistics of China more government accountability. nese it is something more: a time to Cases like this are causing seri- when they return next month. “I’m for both patients and insurance pro- government’s involvement in 32% who opposed it. The rescue The Government of the Republic of Liberia through the Forestry Development Authority make concrete plans about where ous concerns about social stability sure I will find something here,” grams, including Medicare. the banking sector. measures won broad parliamen- (FDA) invites qualified firms to submit proposals to conduct due diligence on companies they will work next year. In years’ in China, where rural residents still ward mobility.” said Zhai Yuanhui, a farmer from Pei- Critics say physicians who refer On Monday, Prime Minister tary backing. bidding on logging concessions. past, many have returned home make up most of the population. Ru- That poses a challenge to the cundian village in Henan province patients to hospitals in which they ernment has “taken on responsibil- Several dozen concessions may be let over the next few years. For each, Forestry Gordon Brown’s government un- But with Britain’s banks still Development Authority will seek a due-diligence report on one or more bidders. flush with cash from their distant ad- ral incomes have risen sixfold since Communist Party, which has staked who has spent three years in Beijing ity for significant liabilities.” have an ownership stake drive up veiled its latest bank package, of- very reluctant to lend and the Tender documents may be downloaded free of charge from the website of the Forestry ventures, and set out after the holi- 1990, according to official Chinese its legitimacy on delivering three de- doing odd jobs to earn more money costs, because they order more fering partial insurance against “We are therefore demanding economy deteriorating, there was Development Authority (http://fda.gov.lr). Alternatively, they may be purchased from the day with new migrants in tow. data. Income from work off the farm cades of high-speed growth. Al- for his family. “I can make about tests or perform unnecessary sur- further losses and fresh guaran- that the Treasury quantify and dis- a lukewarm public reaction to Accounts Department of FDA. But this year, many are heading has become increasingly important ready, concerned governments are 1,000 yuan per month in Beijing just gery. They argue that the physician- tees on bank-issued debt. close the liabilities involved in the Bids must be delivered in hard copy to the address below on or before March 3, 2009 Monday’s measures and a thumbs- at 10:00a.m. They will be opened at that time at the same address. home with no prospect of returning to most rural households. Accord- responding with programs to keep doing small jobs here and there. … owned hospitals also cherry-pick The government hasn’t put a extensive public funding of these down in financial markets, where to their jobs. Chinese media report ing to the National Bureau of Statis- unemployed migrants busy. In south- Before coming here I was lucky to the healthiest patients, which hurts price tag on the new plan, which banks,” Mr. Fallon said in the re- the pound and bank shares fell Republic of Liberia, Forestry Development Authority that upwards of 10 million former tics of China, 1,596 yuan, or 39%, of ern Guangdong province, China’s ex- earn 2,000 yuan in a whole year.” port, set for release early Friday. P.O. Box 3010, Kappa House, Elise Saliby Compound, the finances of other hospitals, the comes on top of a £400 billion sharply. Congo Town, Mongrovia, Liberia migrant workers have been back on per capita annual income of the na- port engine, where thousands of “I’ll do whatever I have to—wher- majority of which are nonprofits. ($559 billion) rescue in October, “Public companies are required to At the heart of the concerns is the farm already for weeks, as facto- tion’s rural households, came from manufacturers have gone out of busi- ever a small thing can be done, I will For years, Rep. Pete Stark, a Califor- including the injection of £37 bil- publish quarterly data on their ac- the fear that further U.K. expo- ries have shuttered and summarily wages in 2007, up from 20% in 1990. ness, the provincial labor bureau re- do it. I have hope.” And in the worst- nia Democrat, has tried and failed to lion into three major banks. The counts, and given the scale of public sure to banks’ liabilities could AVIATION BUSINESS OPPORTUNITIES fired their employees. In central Chi- “In past years, regardless of how leased regulations in December re- case scenario, Mr. Zhai and his stop the growth of doctor-owned hos- government also has national- investment, the taxpayer deserves bury the U.K. in a sea of debt. na’s Zhenyang County, for example, miserable their situation was, mi- quiring local government agencies friends say they can always return pitals amid strong Republican opposi- ized lenders Northern Rock and no less information.” “There are some colossal con- 25,000 migrants returned home in grants had upward mobility,” says to create jobs or provide necessary to their farm, where there is plenty tion and vetoes by former President Bradford & Bingley, and The lawmakers, who come from tingent liabilities that are build- OTC BB December—more than 60% of the Dorothy Solinger, a professor at the assistance to laid-off migrant work- of home-grown food to eat. George W. Bush of bills containing the launched a multibillion-pound Mr. Brown’s Labour Party as well as ing up” for the U.K., said Mat- 2001 Sikorsky S76C+ Super Clean Public Shell migrant labor force in the area—af- University of California in Irvine, ers. The bureau also started provid- —Kersten Zhang, Sue Feng restrictions. Legislation approved in the main opposition parties, want an- plan to ease smaller businesses’ thew Sinclair, research director Executive Helicopter Available for Sale or Merger ter losing their factory jobs. who studies China’s internal migra- ing free job services and training and Andrew Batson 1989 and known as the Stark law gen- access to credit. nual reports detailing the govern- at the TaxPayers’ Alliance, a 1115 Hrs Total Time. EGPWS, Garmin GMX-200 Fully Reporting The impact is already painful. tion. “Now it’s potentially down- courses for the unemployed, and fi- contributed to this article. erally prohibits physicians from refer- In a report from the House ment’s support for the banks and Moving Map, Artex 406 MHZ ELT, Excellent Current in Filings group that campaigns for effi- Maintenance, Engines & Powertrain On Support By ring patients for services in which of Commons’ 14-member Trea- more information on how they are cient use of taxpayer money. The Hour Programs. they have an ownership interest. But sury Select Committee, performing. They also are seeking “Banks are still reporting spec- Contact Dave [email protected] doctor-owned hospitals have been an Michael Fallon, the senior rep- twice-yearly updates from the hold- tacular losses … and that could 781-259-2501 or 781-883-5947 exception to the Stark law. resentative of the opposition ing company managing the govern- mean a big bill for the future.” Paincontinues for bruised U.S. housing sector Now, a provision that Rep. Stark Conservative Party, said the ment’s bank investments. National Distribution Platform helped write in the child-health bill bank measures mean the gov- While the sharply worded report Send comments to [email protected] By Kelly Evans partly reflects a massive overhang through November from their April would effectively put a halt to the BUSINESS OPPORTUNITIES $1.5 Million Consumer products co. Selling to nearly every major US retail Sliding down of unsold homes nationwide and a 2007 peak, according to the Federal construction of any new doctor- chain. Great time to buy in; The battered U.S. housing sector Month-to-month percentage change continuing stream of new foreclo- Housing Finance Agency, which re- owned hospitals and would seri- asking $1.75 million. sures to the market. It also reflects leased November figures Thursday. is off to a rough start this year, as in U.S. housing starts ously hamper plans of existing ones 3 Development Opportunities www.consumerproducts.us.com the real-estate market that led the reduced home-buying activity in The agency tracks prices only on to expand. The bill with the restric- Assets dwindle at BlueBay funds Partnership or Outright Sale nation into recession shows no 10% general, amid rising unemployment homes purchased with loans backed tions was passed by the House last Hampton Inn & Suites signs yet of leading it back out. and tight credit conditions. While by Fannie Mae and Freddie Mac, week. The Senate version is slated By Rachael Gormley the translation of non-U.S. dollar-de- Meanwhile, Aberdeen Asset Man- Vernal, Utah-Permit Ready PUBLICLY-TRADED SHELL 5 New home construction fell mortgage rates have fallen to his- which excludes many homes pur- for approval early next week, nominated assets of $200 million. agement PLC said its assets under Lowe's Anchored Retail Center WITH CASH toric lows, it is unclear whether they chased with riskier mortgages, and though it doesn’t have the restric- LONDON—BlueBay Asset Man- The fixed-income asset manager sharply in December, the Commerce 0 management have remained broadly Riverton, Utah-Fully Entitled § $9+ Million Cash § $80+ Million NOLs § Timely Department said Thursday, and a are stimulating home buying or just its index has shown shallower price tions on doctor-owned hospitals. A agement PLC said that assets under didn’t break out the redemption fig- stable since the end of September, Retail Strip Center Filer § No Material Liabilities § Available For drop in permits for future projects –5 boosting refinancing activity. declines than other gauges. final bill, which could include the re- management dropped 18% in the ure between its hedge funds—which but forecast difficult conditions for Avondale, Arizona-Fully Entitled suggests the declines will continue. A gauge of future home-building The FHFA also reported that home strictions, would go to President last three months of 2008, hit by re- make up around $3.7 billion, or 22% Merger or Acquisitions. –10 the industry. The company said it For All Details Contact: Meanwhile, home-builder confi- activity—permits granted for resi- prices fell a seasonally adjusted 1.8% Barack Obama shortly after that. demptions and the wider market of its assets—and its long-only funds. had £110 billion in assets under man- The Merrill Group of Companies Email: [email protected] dence is at a record low and the gov- –15 dential construction—also sank in nationwide in November from the pre- The Congressional Budget Office downturn. BlueBay said it made perform- agement on Dec. 31, down from £111.1 Owner/Developer ernment’s gauge of home prices, t 15.5% December, falling nearly 11% to a sea- vious month, the largest monthly estimates that the doctor-owned- ance fees in the quarter of around Richard H. Dooling In its fiscal second quarter billion on Sept. 30. à As with all investments, also released Thursday, showed ac- –20 sonally adjusted annual rate of drop yet and a sign that home-price hospital prohibitions included in the £3.2 million ($4.5 million). 800-808-8559 ended Dec. 31, BlueBay’s assets un- Separately, rival New Star Asset appropriate advice should be obtained prior celerating declines nationwide. DNOSAJJMAMFJ 615,000 permits—again a historic declines continue to accelerate. House version of the child-health bill Like many hedge funds, BlueBay [email protected] 2008 der management fell to $16.7 billion Management Group to entering into any binding contract. à Construction on new single- and low. The glum outlook was echoed In a separate gauge of the weaken- would save the government $1.2 bil- has imposed a gate on redemptions PLC said it is sill www.themerrillgroupco.com from $20.5 billion on Sept. 30. They multifamily homes sank 15.5% in De- Source: U.S. Commerce Department in the National Association of Home ing economy, new claims for unem- lion over 10 years in lower Medicare to prevent investor withdrawals. In looking for possible bidders despite were up 1.8% from the $16.4 billion cember from the previous month to a Builders’ survey of builder confi- ployment benefits jumped last week costs. Some in Congress are count- BlueBay’s case this is limited to its continuing with plans to delist its seasonally adjusted annual rate of dence, released Wednesday, which as layoffs continued to mount. Job- ing on that projected savings to help the company had under manage- value-recovery hedge fund, which shares and restructure its business 550,000 units—the lowest pace since heavily on the U.S. economy, which slipped to a new low for January as less claims rose last week by a season- pay for the expanded coverage pro- ment on Dec. 31, 2007. invests in high-yield distressed as a private company. monthly records began in 1959. The likely turned in its worst perform- an overwhelming share of respon- ally adjusted 62,000 to 589,000, the vided by the new child-health bill. BlueBay said Thursday that the debt. The lock-in was imposed last –Marietta Cauchi, rate was down by nearly half from ance in a quarter-century during the dents categorized sales activity as Labor Department said Thursday, Claims that specialty hospitals quarter saw net redemptions of $800 summer and ties up investor cash Victoria Howley the pace seen in December 2007 as final three months of last year. “poor.” matching the highest level seen in a end up costing the government million, market depreciation of $2.8 for 2µ years in return for reduced and Digby Larner the slowdown continues to weigh The decline in building activity Home prices are down 10.5% quarter-century. more are “completely outrageous billion and an exchange-rate loss from management fees. contributed to this article. and false,” says Brett Gosney, presi- dent of Physician Hospitals of Amer- MAKE GREAT ica, the industry’s trade group, To advertise based in Sioux Falls, S.D. “They save Libya considers nationalizing country’s oil sector the government money,” he says, be- Continental chairman’s job at stake CONNECTIONS Emma Balogun cause such hospitals have lower By Spencer Swartz Wednesday via satellite from Libya tions in Libya said Thursday they Shokri Ghanem, head of the Lib- complication rates, lower infection By Christoph Rauwald the Saturday meeting, according to according to the agreement, a maxi- Advertising Sales Executive to students at Georgetown Univer- had yet to receive word from the yan National Oil Co., has said re- rates and lower return-to-surgery people familiar with the situation. mum of four Schaeffler representa- IN EUROPE. After pressing foreign oil compa- sity in Washington, Mr. Gadhafi said government about any plans by the cently that talk about Libya taking rates than other hospitals. FRANKFURT—The supervisory “If von Gruenberg at some point tives can take seats on the board. The Wall Street Journal Europe nies to renegotiate contracts and through an interpreter he had his state to tighten control of the oil sec- more control of its energy sector In addition, Mr. Gosney says the board of German auto-parts decides to leave, it would be his own Schaeffler can replace those hold- +44 20 7842 9608 (direct) give up some profits in recent years, eye on more energy-sector control. tor, according to officials reached was “speculation.” government’s own studies have maker Continental AG scheduled decision,” one person noted. Mr. ing all 10 supervisory board seats, THE WALL STREET Libya is now considering the possi- However, he didn’t elaborate how he for comment. Libya’s recent deals with oil com- shown that doctor-owned hospitals a meeting for Saturday to discuss von Gruenberg couldn’t be reached as long as no more than four mem- +44 20 7842 9650 (fax) bility of nationalizing its oil sector. might tighten the control and some Companies like Los-Angeles- panies have tended to compensate have better outcomes without higher a call by German engineering com- for comment. bers are appointed by Schaeffler, a Libyan leader Moammar Gadhafi analysts say such talk might only be based Occidental Petroleum Corp. firms for much higher costs for costs, even after adjusting for how pany Schaeffler for the chairman Continental has been in turmoil Schaeffler spokesman said. JOURNAL EUROPE. [email protected] has put the move under consider- a way to strengthen Libya’s hand in and Austria’s OMV AG have signed things like drilling rigs and steel. sick patients are. He calls the CBO’s to resign. since Schaeffler made an initial in- Ongoing disputes between ation due to falling crude oil prices negotiations with oil companies. new exploration contracts with But costs have fallen substantially savings estimate “highly flawed.” Schaeffler said this week that if vestment in the company last year Schaeffler and Continental have that are straining the North African The Libyan oil official said Thurs- Libya in recent years under which because of weak industrial activity, If the final legislation contains Chairman Hubertus von Gruenberg and set out to acquire the rest. It fueled concern among investors nation’s oil-dependent economy, ac- day the plans being talked about are they have reduced their share of pro- so Mr. Gadhafi may want to end cost- the proposed restrictions, existing doesn’t resign, it will call an extraor- now holds 49.9% of Continental’s about the prospects for the tie-up. cording to a senior Libyan oil official. in the early stages and would in- duction relative to the state. BP compensation measures to further doctor-owned hospitals wouldn’t dinary shareholders’ meeting and voting stock. Apart from tight credit markets, State-controlled media this week clude natural-gas businesses as well PLC. Eni SpA, Exxon Mobil Corp., boost oil profits for the state. be allowed to add any more beds or replace all shareholder representa- Schaeffler said that a complete the different culture between pri- have also run several articles indicat- as oil and possibly entail higher roy- and Repsol YPF SA are some of the —Benoît Faucon to increase capacity, a restriction tives on the supervisory board. reshuffle of the board doesn’t con- vately owned Schaeffler and listed ing the possibility of increased state alties on hydrocarbons produced. other companies with operations in and Bernd Radowitz Mr. Gosney says would put those Continental’s board was ex- flict with the investor agreement be- Continental appears to be a major control of the oil sector. Speaking Several companies with opera- Libya. contributed to this article. hospitals on a slow path to death. pected to back Mr. von Gruenberg at tween both companies. It said that obstacle.