Free Republic

The world's top commodity trading houses are being told by brokers and exchanges to deposit hundreds of millions of dollars in extra funds to cover their exposure to soaring gas prices, seven sources with direct knowledge of the matter told Reuters. Glencore, Gunvor, Trafigura and Vitol are among the commodity merchants facing what are known as margin calls on their financial positions in natural gas markets, the sources said. The calls are forcing the traders to tie up more capital. Some, particularly smaller firms, are having to increase borrowing, leaving them with less cash to trade with and potentially hurting...

Buried in the depths of page 26 of the Office of the Special Inspector General for the Troubled Asset Relief Program's (SIGTARP's) November 17, 2009 report "Factors Affecting Efforts to Limit Payments to AIG Counterparties" hidden in footnotes 33 and 34 is something of a mystery. It might be the beginning of an interconnected financial chain involving Dubai, the Federal Reserve, AIG, Basel I, Eastern Europe and even Switzerland and which, even if it doesn't worry you, probably should. Or it might be nothing at all. Consider first "footnote 33," that reads as follows: The first Basel Accord, known as...

Aubrey McClendon has margin call.

Sat March 15, 2008 Farmers in fear By Jim Stafford Business Writer Prices paid to Oklahoma wheat farmers for their grain have surged to historic highs, but the prospect of $12-a-bushel wheat at harvest has yielded a surprising side effect, said farm economist Kim Anderson: Fear. The July wheat contract on the Kansas City Board of Trade closed at $12.21 Friday, down 44 cents from the previous day, but still hovering near historic levels. So, what is to fear from wheat priced at three to four times what it was just five years ago? "They are scared to death because...

March 7, 2008 CCC's woes show the crunch is still biting Patrick Hosking: Business commentary The credit crunch is, if anything, getting more acute again. Banks are more scared about lending to one another and are rushing to call in loans or demand more collateral, or extract better terms from borrowers. Carlyle Group is discovering how awkward that can be. Its foray into structured credit is now looking spectacularly ill-timed. The private equity group floated its listed vehicle, Carlyle Capital Corporation, in Amsterdam just days before the financial earthquake struck in August. The idea was to raise a thin layer...

Carlyle unit misses some margin calls By Martin Arnold and Harry Sender in London Published: March 6 2008 13:01 | Last updated: March 6 2008 13:01 Carlyle Capital Corp became the latest casualty of the banks’ increasingly unforgiving attitude towards even the most powerful private equity funds on Thursday when the highly leveraged mortgage-backed securities fund said it had failed to meet margin calls from some of its lenders. The fund, listed in Amsterdam by the Carlyle Group last year, has been hit by a fall in the value of its $21.7bn portfolio of AAA-rated residential mortgage-backed securities, illustrating that...

Hedge fund Focus collapses By James Mackintosh in London Published: March 5 2008 02:00 | Last updated: March 5 2008 02:00 Focus Capital, a $1bn New York hedge fund, has been forced to liquidate its entire portfolio after missing margin calls from banks, it told investors yesterday. The fund, which had produced strong returns by investing in Swiss mid-cap stocks since starting in 2005, is now expected to shut down after losing about 80 per cent of its value. The collapse is the latest to hit leveraged hedge funds, following the failure of Peloton Partners' $2bn ABS fund last week,...

Stocks slide as investors scramble for safety By Michael Mackenzie and Saskia Scholtes in New York Published: February 29 2008 19:08 | Last updated: February 29 2008 21:10 Stock prices and bond yields tumbled on Friday as fears about the stability of the financial system sent investors scrambling for the safety of government debt. The yield on the two-year Treasury note dropped to its lowest level in nearly four years, while the S&P 500 stock index fell 2.7 per cent and the Dow Jones Industrial Average lost 2.5 per cent. Traders said sharp falls in the prices of mortgage bonds...

Securities dealer Tricom Equities has failed to settle tens of millions of dollars worth of share trades after being caught in a deluge of margin calls, according to Fairfax media reports. Tricom is thought to be under pressure to pay down loans to ANZ Banking Group, which financed the significant expansion of the company's $2.7 billion margin loan book, the reports said. Tricom has attributed its settlement delays to exceptionally large trades last week. According to the media reports, the margin loan specialist took heavy losses in trade on Tuesday last week, when the worst sharemarket fall in 18 years...