Jaime Bece

Bernanke to Congress: Don't Ignore Fiscal Balance

Nice move after handing out money at the corner of every street, or no.. wait... it was only Wall Street!

The US deserves to have its rating downgraded, and Ben knows it.

The Short Selling Rules: Too Little, Too Late

Do you know if ETFs or synthetic short selling through derivatives are included in the ban?

I really think blaming hedge funds and short sellers is the easy way out. Isn't it an interesting coincidence that just before Goldman and Morgan Stanley were in big trouble H. Paulson (ex-Goldman) decided to act?

Thanks and good article by the way

Bank of America vs. Banco Santander: Whose Dividend Is Secure?

I totally agree they have a potential risk as 70% of their mortgage book comes from Spain and UK. However there are significant differences in lending standards in the US, UK and Spain (by far the strictest) that really make the difference.

Some of these (almost no lending >80% LTV, €6bn generic provisions or overcollateralization) are the main reason why Santander has overperformed its peers over the last quarters. It can get boring, but it no Spanish bank has had to write down any exposure to US, UK, Spain or Singapore real estate it's very likely that's not a matter of luck, but skill.

In the US you could find "pay-option ARMs", "pick-a payment loans", "minimum payment loans" and some lenders like Countrywide reporting 90% of their mortgages were done without confirming the borrower's income.. Something similar happened with Bradford & Bingley in the UK (-50% in 3 days and -95% from its peak).

On the other hand you are very right pointing out they are exposed to risky markets. The problem with banks is they do all they can to remain opaque, something I hope will change in the future..

Interesting blog

Bank of America vs. Banco Santander: Whose Dividend Is Secure?

You could also take into account Santander has given an uniterrupted dividend to its shareholders for more than 25 years, even through tough recessions as the one suffered in 1992-97 in Spain. No exposure to subprime and no "new team entering investment banking business just to lose a couple billions in a few months and decide to close it" (aka Bank of America).

Brazil's Ready for Big Fixed Income Investors

Unfortunately inflation is running high and biofuels will not help push down food prices (already +15% YoY), especially those with highest demand from China (e.g. soy).

The interesting point is what will happen with all the number of Government-employed people in Brazil. Will they start to work and look for entrepeneurial ideas? That I'd like to know

Good article by the way