Agreement between BNPPARIBAS and FORTIS - DEXIA announced a 3 bn EUR loss for 2008 and will cut dividend

·       Roller coaster ride again: DJ -2.7%, S&P500 -3.3%, NASDAQ -3.2%, NIKKEI -3.1% and EUROSTOXX -2.3% down by 1% now.

·       DEXIA announced a 3 bn EUR loss for 2008 and will cut the dividend. Some 900 people will leave the bank on a total of 35000 (only 2.5% of the staff), what rather limited is.. The trading activity will be downscaled and rumour has it that this activity in Luxembourg might be transferred to Brussels. The share is down 8%.

·       The Belgian government, BNPPARIBAS and FORTIS found an agreement that still has to be confirmed at the next shareholders’ meeting.  According to a bank based in the Netherlands, FORTIS HOLDING would be around 2.8-2.9 EUR worth. A big discount must nevertheless be applied. Be careful : no rush but some hope.

·       Bob Dole (CIO with BLACKROCK) was yesterday in Luxembourg and gave his views on markets and the economy. He thinks that there is a 70% chance that we are in a deep recession (10% likelihood of a depression and 20% of a light recession). According to him, the US will see only 2% GDP growth over the coming years compared with 3.5-4.0% over the past 10 years. He is also convinced that the US car industry is not viable.

·       The volatility index VIX is up at 42.6. Gold is in great shape at 908 USD per oz and the oil price is as well at 44.5 USD. The USD is up against the EUR at 1.29. 10-2 years spread is normalizing further at 1.44. The 5 y CMS is at 3.06.

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