Big gain with no news is amazing, could anyone imagine when there is a hints of news coming out. It will be a big blast off, always happy with this kind of gain.
Also found one news out 15 hours ago.
The F.D.I.C. Mission to Face Problem Banks Early
Published: February 23, 2010
Killing zombies isn’t just a job for horror movie heroines. It’s also the primary task of Sheila C. Bair, the head of the Federal Deposit Insurance Corporation.
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Kimimasa Mayama/Bloomberg News
Shoppers in Tokyo. Growth is slow, but Japan's economy is in reasonable shape.
Ms. Bair’s challenge has increased as the number of so-called problem banks on the F.D.I.C.’s watch list has spiked. But there is little reason the F.D.I.C. can’t exterminate the banking industry’s living dead.
On Tuesday, the agency reported that 702 problem institutions were on its watch list as of the end of 2009. Those institutions had combined assets of $403 billion, or the equivalent of 3 percent of the nation’s economic output. While those figures may seem scary, the F.D.I.C. also managed to collect $46 billion in new cash from banks, bringing its total cash and liquid securities to $66 billion.
That may not seem to be much of a cushion. After all, the average estimated loss rate for bank failures since 2007 — excluding the collapse of the giant Washington Mutual — is 23 percent of assets.
Assuming no truly gigantic banks founder — that is, the ones considered “too big to fail” — the F.D.I.C.’s kitty is currently around $27 billion shy of being able absorb all its sick banks.
Not all of the banks on the F.D.I.C.’s list will be seized. Many banks work their way through difficulties, raise private capital or are taken over by healthier rivals. And the F.D.I.C. can levy another special assessment on banks before asking the taxpayer to pitch in. Add it all up, and the F.D.I.C. has no financial excuse to avoid cleaning up the mess.
Yet the pace of bank seizures — up by half so far this year — hasn’t kept pace with the growth of the problem bank list. The worry is that zombie banks will suck up deposits and hoard capital that might otherwise be lent out by healthy institutions.
The winter storms that closed down Washington this month complicated travel plans for F.D.I.C. staff members. But the main lesson from the savings-and-loan debacle of the 1980s and 1990s was that delays in closing insolvent banks increase resolution costs for the F.D.I.C. and, ultimately, taxpayers.
With spring around the corner, Ms. Bair needs to set her sights on a big zombie hunting trip.
Japan’s Recovery
The conventional wisdom is that Japan has never really recovered from the bursting of the stock market and real estate bubbles in 1990. That view is basically wrong.
Sure, prices have not recovered. The stock market is still almost 75 percent below its peak, and land prices are down 60 percent. After two decades of nearly stable consumer prices, the Japanese government is once again badgering the central bank to do something to create a bit of inflation.
This appeal, like so many before it, is likely to end inconclusively. Japan will continue with its longstanding pattern of near-stable prices, slow growth and gargantuan government deficits. But the economy is basically in pretty good shape.
While the economic growth — about 1 percent a year since 1990 — seems unimpressive, the number of people below retirement age has been shrinking by 0.4 percent a year. Annual growth in per capita gross domestic product in the United States over the same period was 1.4 percent — not much different from Japan’s.
Other economic indicators suggest Japan is managing pretty well. Even midrecession, car sales are only 20 percent less than at the 1990 peak.
Housing starts are down 50 percent, but the population was rising then and is declining now. The 5 percent unemployment rate is modest by Western standards. And the 1.4 percent yield on the 10-year government bond hardly seems a vote of no confidence in the government or the country.
The country’s financial burden — gross government debt at 200 percent of G.D.P. — could yet prove too much to bear for a rapidly aging and steadily declining Japanese population. But for now, Japan should be more a sign of hope than gloom for the United States, Britain and euro zone countries that have endured a severe financial collapse.
Japan had advantages in dealing with its financial collapse. It has a high savings rate, a big trade surplus and a powerful tradition of cultural and political unity. Few Western countries have all of these. Most also face almost Japanese-style demographic challenges. They will be fortunate to do as well as Japan.
