Credit Card Charge-Offs at Record HighThe U.S. monthly credit card charge-off rate continued to rise and hit another record high in May, for the sixth straight month, according to Moody's Investors Services (MCO).The charge-off rate rose to 10.62% in May from 9.97% in April, and Moody's expects the rate to continue to rise in the coming months, though at a slower pace, and peak at around 12% in the second quarter of 2010.Though the delinquencies (monthly payments more than 30 days late) fell to 5.97% in May from 6.34% in April, it was more due to a seasonal trend, as consumers used tax refunds to pay back their credit card debts, and the rating agency expects the delinquencies to resume their upward trend.The pace of economic slowdown is now declining and the recession is ...

by Edward Hugh: BarcelonaWell the action in Russia this week has moved on slightly, and the damage has started to spread from pressure on the domestic stock market (accompanied by capital flight) to the real economy - via a very rapid tightening in credit conditions for Russian domestic users. We are also seeing a rapid slowdown in Russian manufacturing industry as internal demand slows while the inflation-driven decline in cost competitiveness continues to make imported products (where available) an attractive alternative to the home produced variant.Emerging-market bonds have been generally falling this week as the U.S. Senate's approval of a $700 billion bank rescue package did little to revive demand for riskier debt, and Russia has, unsurprisingly, been among the worst affected. The extra yield investors demand to own developing-nation bonds rather than U.S. Treasuries rose 8 basis points yestreday to 4.14 percentage points after widening ...

by Edward Hugh: BarcelonaWell the action in Russia this week has moved on slightly, and the damage has started to spread from pressure on the domestic stock market (accompanied by capital flight) to the real economy - via a very rapid tightening in credit conditions for Russian domestic users. We are also seeing a rapid slowdown in Russian manufacturing industry as internal demand slows while the inflation-driven decline in cost competitiveness continues to make imported products (where available) an attractive alternative to the home produced variant.Emerging-market bonds have been generally falling this week as the U.S. Senate's approval of a $700 billion bank rescue package did little to revive demand for riskier debt, and Russia has, unsurprisingly, been among the worst affected. The extra yield investors demand to own developing-nation bonds rather than U.S. Treasuries rose 8 basis points yestreday to 4.14 percentage points after widening ...

The outlook rating for Russia's banking system was changed today from "stable" to "negative" by Moody's Investors Services. The Banking System Outlook Report (published today) clited slowing asset growth, higher inflation, the slump in equities and funds leaving the country, all of which could result in deteriorating fundamentals for banks, according to the credit rating agency. Moody's thus joins the other two large credit rating agencies - Fitch Ratings and Standard and Poor's in downgrading at least a part of the Russian financial system. Fitch said in a report last week that Russian real estate and construction companies were the most at risk as domestic and international banks curb lending, while Russia's credit outlook was cut to ``stable'' from ``positive'' at Standard & Poor's on Sept. 19. S&P's cited the growing pressure on Russian authorities to spend resources from the National Wealth Fund, undermining the nation's ...

Shares of American International Group, Inc. (AIG), the largest U.S. insurer plunged today (Tuesday) after the three most prominent ratings agencies downgraded the company’s credit rating. At 11:30 a.m. EDT, AIG shares were trading at $2.53, down $2.23 (more than 40%) after earlier hitting a new 52-week low of $1.25. Today’s decline followed on the heels of yesterday’s (Monday’s) 60% drop. AIG stock has traded as high as $70.13 in the past 12 months, but the insurer’s shares are down over 95% year-to-date. All three major ratings agencies – Standard & Poor’s, Moody’s Investors Services (MCO) and Fitch Ratings Inc. – downgraded AIG stock at least two levels on its current liquidity crisis late Monday night. The cuts require AIG to post an additional $13 billion in collateral to secure its portfolio....

It was another whipsaw session on the Street as stocks staged a late-day rally to pare early losses and finish deep in the green. The Dow climbed 165 points to close at 11,434.

The big surge came in response to word that Lehman Brothers, Inc. (LEH), the beleaguered investment bank, had entered into conversations with possible suitors after Moody's Investors Services said the company needs to find a "stronger financial partner." Lehman has been aggressively pursuing additional capital support as the company suffers from a portfolio of deteriorating assets and mounting losses.

Adding to the gloomy macro-level economic picture was the Commerce Department's report that the national trade deficit grew to its highest level in 16 months in July, climbing 5.7% to $62.2 billion. The reading was worse than analyst projections of $58 billion, driving the deficit between imports and exports to its highest level since March

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