The euro staged a broad rally and US stocks jumped 3 percent Thursday, after China said Europe remains a key investment market for its foreign-exchange reserves.
The People's Bank of China said a Financial Times report that Beijing was concerned about its euro-zone bond holdings was groundless.
The FT report had driven the euro to a near four-year low on Wednesday and cut short a rally in US stocks.
Stocks in Europe and emerging markets also jumped and crude oil prices jumped 4 percent as the perceived risk that China might change the composition of its foreign exchange reserves was reduced.
"Reports from the front suggested that investors might become frightened that China could do something drastic," said Douglas Peta, an independent market strategist in New York. "Getting some assurance that Chinese sale of European debts isn't imminent is making everyone feel better."
At the close of trade, the Dow Jones industrial average gained 284.54 points, or 2.85 percent, to 10,258.99. The Standard & Poor's 500 Index rose 35.11 points, or 3.29 percent, to 1,103.06. The Nasdaq Composite Index climbed 81.80 points, or 3.73 percent, at 2,277.68.
Equity markets shrugged off a report showing the US economy grew at a slower pace than previously estimated in the first quarter as business investment slackened.
The euro gained 1.67 percent at $1.237 while the dollar fell against a basket of major trading-partner currencies.
On Wednesday the euro collapsed 1.5 percent against the dollar after the Financial Times reported China's State Administration of Foreign Exchange (SAFE) was meeting foreign bankers because of concerns about its exposure to debt troubles in Europe.
SAFE, the arm of the central bank, manages China's $2.4 trillion in foreign exchange reserves -- the world's largest stockpile.
Crude oil prices posted their biggest two-day gain since mid-August, as a forecast for an intense Atlantic hurricane season fueled fears of disruptions in US supplies and spurred speculative buying. Oil had also risen more than 4 percent on Wednesday.
People's Daily Online / Agencies
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Friday, 28 May 2010
Lehman Sues JPMorgan for Billions of Dollars in ‘Lost Value’
Lehman Brothers sues JPMorgan for billions over collapse
[JURIST] Lehman Brothers Holdings [corporate website] on Wednesday filed suit [complaint, PDF] against JPMorgan Chase & Co. [corporate website] for allegedly "siphoning" off billions of dollars in "critically-needed" assets days before the investment bank filed for a record-breaking bankruptcy. JPMorgan was Lehman's main short-term lender before its collapse and acted acted as a middleman between Lehman and its investors. In the complaint, Lehman accused JPMorgan executives of using inside knowledge to take advantage of Lehman during its financial downfall and pressured the brokerage firm to turn over $8.6 billion in collateral in September 2008. The last-minute transactions allegedly accelerated Lehman's free fall into bankruptcy, costing the investment bank tens of billions of dollars in "lost value." The complaint, which was filed in the US Bankruptcy Court for the Southern District of New York [official website] in Manhattan, is seeking monetary relief for JPMorgan's contribution in Lehman's downfall as a result of its wrongful conduct:
JPMorgan's insistence on the new agreements in August and September 2008, its unjustified demands for billions in additional collateral, and its refusal to return that collateral in the critical days before [Lehman's] bankruptcy filing, severely constrained [Lehman's] liquidity and impeded its ability to pursue and implement alternatives and initiatives that would have resulted in the preservation of billions in value. Instead, [Lehman's] liquidity constraints compelled an exigent chapter 11 filing that has resulted in tens of billions of dollars in additional lost value to the [Lehman] estate and its creditors. ... It is now too late to undo all the harm caused by the [Lehman] bankruptcy. It is not too late, however, to return to [Lehman's] estate and its creditors the billions of dollars of [Lehman] assets that JPMorgan illegally converted and continues to hold, and to compensate [Lehman] for all the damages that flow directly from JPMorgan's misconduct. This lawsuit seeks to return that value to the [Lehman] estate and to restore all of the creditors to the position they would have occupied but for JPMorgan's wrongful conduct.
By Linda Sandler and David McLaughlin --Editors: John Pickering, Michael Hytha.
 |  |
JPMorgan's insistence on the new agreements in August and September 2008, its unjustified demands for billions in additional collateral, and its refusal to return that collateral in the critical days before [Lehman's] bankruptcy filing, severely constrained [Lehman's] liquidity and impeded its ability to pursue and implement alternatives and initiatives that would have resulted in the preservation of billions in value. Instead, [Lehman's] liquidity constraints compelled an exigent chapter 11 filing that has resulted in tens of billions of dollars in additional lost value to the [Lehman] estate and its creditors. ... It is now too late to undo all the harm caused by the [Lehman] bankruptcy. It is not too late, however, to return to [Lehman's] estate and its creditors the billions of dollars of [Lehman] assets that JPMorgan illegally converted and continues to hold, and to compensate [Lehman] for all the damages that flow directly from JPMorgan's misconduct. This lawsuit seeks to return that value to the [Lehman] estate and to restore all of the creditors to the position they would have occupied but for JPMorgan's wrongful conduct.
May 27 (Bloomberg) -- Lehman Brothers Holdings Inc. sued JPMorgan Chase & Co. to recover tens of billions of dollars in “lost value,” accusing the bank of precipitating its downfall and preventing it from winding down in an orderly fashion.
JPMorgan, which was Lehman’s main short-term lender before its September 2008 bankruptcy, helped cause the failure by demanding $8.6 billion of collateral as credit markets tightened during the financial crisis, Lehman said in a complaint filed yesterday in U.S. Bankruptcy Court in New York.
“On the brink of LBHI’s bankruptcy, JPMorgan leveraged its life and death power as the brokerage firm’s primary clearing bank to force LBHI into a series of one-sided agreements and to siphon billions of dollars in critically needed assets,” Lehman said in the complaint.
Lehman, once the fourth-biggest investment bank, has said it may spend another five years selling assets to pay unsecured creditors as little as 14.7 cents on the dollar. Any money recovered through lawsuits may increase the payout.
“The lawsuit is ill conceived, and the costly litigation will cause a further drain on the limited resources available to the Lehman bankruptcy estate,” said Joe Evangelisti, a JPMorgan spokesman.
The lawsuit follows a report by Lehman examiner Anton Valukas, who said in March that Lehman might have grounds for suing JPMorgan and other banks.
Lehman said JPMorgan’s top managers took advantage of privileged information they gained as Lehman’s primary clearing bank to “capitalize” on a Lehman bankruptcy.
Dimon Meetings
JPMorgan Chairman Jamie Dimon knew from meetings in Washington with Federal Reserve Chairman Ben Bernanke and former U.S. Treasury Secretary Henry Paulson that the U.S. wouldn’t rescue Lehman and decided to “accelerate” the bank’s efforts to gain more collateral from Lehman, according to the complaint.
JPMorgan gained extra collateral from Lehman in part by threatening to stop providing clearing services that were the “lifeblood” of the Lehman brokerage and other affiliates, according to the lawsuit. Lehman said JPMorgan put a “financial gun” to its head and gave the already insolvent investment bank nothing in return for the collateral.
Lehman said in the complaint that from Sept. 9 to Sept. 11 in 2008 it posted $3.57 billion in cash and money-market funds as collateral. On the night of Sept. 11, JP Morgan demanded an additional $5 billion, which Lehman delivered the next night.
Total Collateral
The total $8.6 billion in collateral “rightfully” belongs to defunct Lehman and its creditors, Lehman said. In addition, it seeks unspecified damages, according to the complaint.
“As the examiner’s report makes clear, it was the ill- advised decisions of Lehman itself and its principals to take on perilous leverage and to double down on subprime mortgages and overpriced commercial real estate, and not any conduct by JPMorgan, that led to Lehman’s demise and the enormous losses to its various constituents,” Evangelisti said.
Lehman also has sued Barclays Plc, which bought its bankrupt brokerage, alleging the British bank made an $11 billion “windfall” on the deal. A trial of that suit is due to continue next month in bankruptcy court.
Lehman filed the biggest bankruptcy in U.S. history with assets of $639 billion. It has paid its lawyers and managers $794 million in 19 months, according to a regulatory filing.
Creditors include Goldman Sachs Group Inc., UBS AG, the New York Giants and Abu Dhabi Investment Authority as well as individuals who hold Lehman bonds.
The case is In re Lehman Brothers Holdings Inc., 08-13555, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
Concepts of fairness and inequality develop over time
As part of a research study in experimental economics at NHH in Norway, 500 school children had to work and then decide how to share their earnings.Image courtesy of Knut Egil Wang.
Young children are strict egalitarians, content to divvy things up equally among members of a group -- but, as those children progress from elementary school to adolescence, their sense of fairness changes to a more merit-based ideology, researchers report in the May 28 issue of Science.
Ingvild Almľs and colleagues used an economic exchange game and a large group of fifth- to 13th-grade volunteers to reach this conclusion. They suggest that more exposure to various achievement-based activities, like sports, could be one of the reasons why the older children eventually shift toward a more merit-based stance.
The researchers say that most adults believe that differences in individual achievements, as well as outside influences, can justify unequal distributions of income, but that they disagree on whether inequalities reflecting luck are fair or not.
Almľs and her colleagues used a modified version of the dictator game, which has been considered the standard experimental design for studying fairness preferences, to gauge the younger generations’ concepts of fairness while the students were distributing wealth among group members.
The researchers found that the large majority of fifth graders were strict egalitarians, but the older students considered individual achievement increasingly important when dividing up their wealth.
The findings demonstrate that, as children get older, they seem to place a heavier emphasis on peoples’ actual production—but not their luck—on pay day. They also imply that social experiences play a role in shaping children’s concepts of fairness.
More information: "Fairness and the Development of Inequality Acceptance," by I. Almas et al., Science.The researchers say that most adults believe that differences in individual achievements, as well as outside influences, can justify unequal distributions of income, but that they disagree on whether inequalities reflecting luck are fair or not.
Almľs and her colleagues used a modified version of the dictator game, which has been considered the standard experimental design for studying fairness preferences, to gauge the younger generations’ concepts of fairness while the students were distributing wealth among group members.
The researchers found that the large majority of fifth graders were strict egalitarians, but the older students considered individual achievement increasingly important when dividing up their wealth.
The findings demonstrate that, as children get older, they seem to place a heavier emphasis on peoples’ actual production—but not their luck—on pay day. They also imply that social experiences play a role in shaping children’s concepts of fairness.
Provided by AAAS
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Copyrights lawsuit: Yahoo, Facebook side with Google against Viacom
Some of the biggest and most respected Web services have come to the aid of Google and YouTube, which are defending themselves against accusations that they violated copyright on a grand scale.
Yahoo, Facebook and eBay on Wednesday filed a friends-of-the-court brief in the U.S. District Court for the Southern District of New York. That's where Viacom, parent company of MTV Networks and Paramount Pictures, filed a $1 billion copyright lawsuit against Google in March 2007.
The three companies have urged District Judge Louis Stanton to dismiss Viacom's suit, arguing that the Digital Millennium Copyright Act protects Internet service providers from liability for copyright violations committed by users. They say that a decision against Google could stifle the growth of important Internet services.
"Plaintiffs' legal arguments, if accepted, would retard the development of the Internet and electronic commerce," wrote a lawyer representing the four companies.
Viacom alleges that YouTube, which Google acquired in 2006, encouraged users to upload unauthorized clips from Paramount Pictures, Comedy Central, and MTV Networks to the video-sharing site. Those clips helped YouTube attract users as well as generate ad sales, Viacom claims.
The amicus brief filed on Wednesday follows a similar type of filing made by NBC Universal, Warner Bros., Disney, the Screen Actors Guild, and Directors Guild of America on behalf of Viacom.
That so many powerhouse companies are weighing in is testament to the importance of the case. The court's decision will likely help establish copyright law as it applies to the Web.
In response to Wednesday's filing, Kelly McAndrew, a Viacom spokeswoman, told Bloomberg: "The courts have been clear that creating and building a Web-based business on the intellectual property of others is illegal. That is exactly what YouTube did in its formative years."
But when it comes to services such as YouTube, the law hasn't been as clear as McAndrew asserts--not to the courts or even Viacom executives.
In September, a U.S. district judge ruled in favor of Veoh, an online-video service, after that site was sued by Universal Music Group for alleged copyright violations. Legal analysts have said that the Veoh case is very similar to YouTube's but Viacom has argued that there are important differences and that decision, which Universal said it will appeal, is not binding on Stanton's decision.
And Viacom also has had trouble determining whether the DMCA protects YouTube.
On Friday, more documents in Viacom vs. Google were released and among them was an e-mail from Michael Fricklas, Viacom's general counsel, in which Fricklas appeared to defend YouTube.
"Mostly, YouTube behaves--and why not," Fricklas wrote in July 2006. "User-generated content appears to be what's driving it right now. Also, the difference between YouTube's behavior and Grokster's is staggering. While the Supreme Court's language IS broad; the precedent is not THAT broad."
A Viacom spokeswoman said Fricklas' e-mail was sent before Fricklas had a chance to fully evaluate YouTube and "in a few short months, it became clear to Mr. Fricklas and others that YouTube's behavior was egregiously unlawful."
Yahoo, Facebook and eBay on Wednesday filed a friends-of-the-court brief in the U.S. District Court for the Southern District of New York. That's where Viacom, parent company of MTV Networks and Paramount Pictures, filed a $1 billion copyright lawsuit against Google in March 2007.
The three companies have urged District Judge Louis Stanton to dismiss Viacom's suit, arguing that the Digital Millennium Copyright Act protects Internet service providers from liability for copyright violations committed by users. They say that a decision against Google could stifle the growth of important Internet services.
"Plaintiffs' legal arguments, if accepted, would retard the development of the Internet and electronic commerce," wrote a lawyer representing the four companies.
Viacom alleges that YouTube, which Google acquired in 2006, encouraged users to upload unauthorized clips from Paramount Pictures, Comedy Central, and MTV Networks to the video-sharing site. Those clips helped YouTube attract users as well as generate ad sales, Viacom claims.
That so many powerhouse companies are weighing in is testament to the importance of the case. The court's decision will likely help establish copyright law as it applies to the Web.
In response to Wednesday's filing, Kelly McAndrew, a Viacom spokeswoman, told Bloomberg: "The courts have been clear that creating and building a Web-based business on the intellectual property of others is illegal. That is exactly what YouTube did in its formative years."
But when it comes to services such as YouTube, the law hasn't been as clear as McAndrew asserts--not to the courts or even Viacom executives.
In September, a U.S. district judge ruled in favor of Veoh, an online-video service, after that site was sued by Universal Music Group for alleged copyright violations. Legal analysts have said that the Veoh case is very similar to YouTube's but Viacom has argued that there are important differences and that decision, which Universal said it will appeal, is not binding on Stanton's decision.
And Viacom also has had trouble determining whether the DMCA protects YouTube.
On Friday, more documents in Viacom vs. Google were released and among them was an e-mail from Michael Fricklas, Viacom's general counsel, in which Fricklas appeared to defend YouTube.
"Mostly, YouTube behaves--and why not," Fricklas wrote in July 2006. "User-generated content appears to be what's driving it right now. Also, the difference between YouTube's behavior and Grokster's is staggering. While the Supreme Court's language IS broad; the precedent is not THAT broad."
A Viacom spokeswoman said Fricklas' e-mail was sent before Fricklas had a chance to fully evaluate YouTube and "in a few short months, it became clear to Mr. Fricklas and others that YouTube's behavior was egregiously unlawful."
By Greg Sandoval covers media and digital entertainment for CNET News. He is a former reporter for The Washington Post and the Los Angeles Times. E-mail Greg, or follow him on Twitter at http://twitter.com/sandoCNET.Newscribe : get free news in real time
Thursday, 27 May 2010
Raja Petra challenges Govt to bring him to trial in London
Raja Petra can’t be tried in Britain
By TEH ENG HOCK
PETALING JAYA May 26, 2010: The Govern-ment cannot bring fugitive blogger Raja Petra Raja Kamarudin to trial in Britain even if it wanted to.
Bar Council vice-president Lim Chee Wee said Malaysia would have to bring Raja Petra back to prosecute him.
“Essentially, it can’t be done,” he said when asked about Raja Petra’s challenge to the Malaysian Government to try him in Britain.
“You have to bring him back to prosecute him. To do that, you have to check if there is an extradition treaty with Britain.
“And if there is, it depends whether UK gives consent. One factor is whether he can get a fair trial in Malaysia,” said Lim.
It was reported on Monday that an online news portal had written that Raja Petra said he would seek a level playing field in his fight against charges of defamation and sedition as well as his appeal against his detention under the Internal Security Act.
Raja Petra refuted the notion that he should return home to defend himself at a Malaysian court, adding that it was the prosecution’s job to prove guilt.
He has two warrants of arrest issued against him for not attending up for his sedition trial in April and May last year.
Another lawyer, Norman Fernandez concurred with Lim that Raja Petra cannot be tried in Britain. “There is no provision to try him in UK. He is not a war criminal.
“And if he is tried there, and found guilty, can he serve his sentence in a UK prison?” he said.
Fernandez said Raja Petra was merely taunting the Malaysian authorities after he managed to slip out of the country.
“He’s thumbing his nose at the Malaysian authorities and saying ‘Catch me if you can’. He knows it is not easy to bring him back to Malaysia,” he said.
Fernandez said nobody knew Raja Petra’s residential status in Britain.
“If he is a visitor, then his term of stay in the country is limited. He could have entered Britain through special documents. Or as a refugee.
“We don’t know, and the British authorities have yet to shed light on this,” he said.
Former Selangor PKR Youth chief Hamidzun Khairuddin, who joined Umno in 2004, called Raja Petra a traitor to Malaysians.
Raja Petra challenges Govt to bring him to trial in London
PETALING JAYA May 25, 2010: Fugitive blogger Raja Petra Raja Kamarudin has turned up in London and threw a challenge to the Malaysian Government to bring him to trial in the United Kingdom.
An online news portal reported that the writer had said that he would seek a level playing field in his fight against charges of defamation and sedition as well as his appeal against his detention under the Internal Security Act.
“I will take on the Government and I will fight them but I will do what Sun Tzu said, ‘Fight him in your territory.’
“So my territory is here in the UK,” he said in a speech in a hall in Holborn in London on Saturday.
The talk was reportedly organised by the Solicitors International Human Rights Group.
Raja Petra refuted the notion that he should return home to defend himself at a Malaysian court, adding that it’s the prosecution’s job to prove guilt.
He also said that Opposition Leader Datuk Seri Anwar Ibrahim, who is facing a sodomy charge, was in a different situation.
“Anwar has accepted the fact that he has to stay (in Malaysia) as he aspires to be the next prime minister. I have no political aspirations.
“I’ll probably be a free man longer than Anwar,” the Malaysian Insider news portal quoted him as saying.
In April, Home Minister Datuk Seri Hishammuddin Tun Hussein said that the police were investigating how Raja Petra had used other channels to go overseas without any trace of immigration records when he left the country.
Raja Petra, who has two warrants of arrest issued against him for not turning up for his sedition trial in April and May last year — had possibly escaped to Thailand via Langkawi
By ZULKIFLI ABD RAHMAN
newsdesk@thestar.com.my
By TEH ENG HOCK
enghock@thestar.com.my
PETALING JAYA May 26, 2010: The Govern-ment cannot bring fugitive blogger Raja Petra Raja Kamarudin to trial in Britain even if it wanted to.Bar Council vice-president Lim Chee Wee said Malaysia would have to bring Raja Petra back to prosecute him.
“Essentially, it can’t be done,” he said when asked about Raja Petra’s challenge to the Malaysian Government to try him in Britain.
“You have to bring him back to prosecute him. To do that, you have to check if there is an extradition treaty with Britain.
“And if there is, it depends whether UK gives consent. One factor is whether he can get a fair trial in Malaysia,” said Lim.
It was reported on Monday that an online news portal had written that Raja Petra said he would seek a level playing field in his fight against charges of defamation and sedition as well as his appeal against his detention under the Internal Security Act.
Raja Petra refuted the notion that he should return home to defend himself at a Malaysian court, adding that it was the prosecution’s job to prove guilt.
He has two warrants of arrest issued against him for not attending up for his sedition trial in April and May last year.
Another lawyer, Norman Fernandez concurred with Lim that Raja Petra cannot be tried in Britain. “There is no provision to try him in UK. He is not a war criminal.
“And if he is tried there, and found guilty, can he serve his sentence in a UK prison?” he said.
Fernandez said Raja Petra was merely taunting the Malaysian authorities after he managed to slip out of the country.
“He’s thumbing his nose at the Malaysian authorities and saying ‘Catch me if you can’. He knows it is not easy to bring him back to Malaysia,” he said.
Fernandez said nobody knew Raja Petra’s residential status in Britain.
“If he is a visitor, then his term of stay in the country is limited. He could have entered Britain through special documents. Or as a refugee.
“We don’t know, and the British authorities have yet to shed light on this,” he said.
Former Selangor PKR Youth chief Hamidzun Khairuddin, who joined Umno in 2004, called Raja Petra a traitor to Malaysians.
Raja Petra challenges Govt to bring him to trial in London
PETALING JAYA May 25, 2010: Fugitive blogger Raja Petra Raja Kamarudin has turned up in London and threw a challenge to the Malaysian Government to bring him to trial in the United Kingdom.
An online news portal reported that the writer had said that he would seek a level playing field in his fight against charges of defamation and sedition as well as his appeal against his detention under the Internal Security Act.
“I will take on the Government and I will fight them but I will do what Sun Tzu said, ‘Fight him in your territory.’
“So my territory is here in the UK,” he said in a speech in a hall in Holborn in London on Saturday.
The talk was reportedly organised by the Solicitors International Human Rights Group.
Raja Petra refuted the notion that he should return home to defend himself at a Malaysian court, adding that it’s the prosecution’s job to prove guilt.
He also said that Opposition Leader Datuk Seri Anwar Ibrahim, who is facing a sodomy charge, was in a different situation.
“Anwar has accepted the fact that he has to stay (in Malaysia) as he aspires to be the next prime minister. I have no political aspirations.
“I’ll probably be a free man longer than Anwar,” the Malaysian Insider news portal quoted him as saying.
In April, Home Minister Datuk Seri Hishammuddin Tun Hussein said that the police were investigating how Raja Petra had used other channels to go overseas without any trace of immigration records when he left the country.
Raja Petra, who has two warrants of arrest issued against him for not turning up for his sedition trial in April and May last year — had possibly escaped to Thailand via Langkawi
By ZULKIFLI ABD RAHMAN
newsdesk@thestar.com.my
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