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My Christmas party chatter covered the German banks and the feeling is they
have significantly less exposure than the French, but who knows. Seems like
people are starting to put trades on around this.

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Neil Callahan

Rosemont Seneca

401 Greenwich Street, Suite 400 | New York NY 10013 | 212-933-9965 |
212-796-4037

1010 Wisconsin Avenue, Suite 705 | Washington DC 20007 | 202-333-1880

917-945-9516 (mobile)

866-749-8879 (fax)


From: Michael Andrews [mailto:mandrews@ips.edu]
Sent: Wednesday, December 22, 2010 11:49 AM
To: ncallahan@rosemontseneca.com
Cc: 'Devon Archer'; 'Curtis Hastings'; 'Hunter Biden'; 'Eric Schwerin'
Subject: Re: China frets about spreading EU debt - SCMP


It is interesting and I think it is directionally correct but I suspect the
German banks are in a very similar place since they were competing for the
same markets as the French and they have customers in each of the markets
mentioned.

On Dec 22, 2010, at 10:16 AM, Neil Callahan wrote:


I heard a great quote at a Christmas party - We know the crisis is over when
the French banks fail . . . they own a tremendous amount of the bad debt of
Greece, Ireland, Portugal and Spain. The Street is waiting for them to
write it all down.


I wonder what the chatter is about BNP Paribas, Credit Agricole and SocGen?


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Neil Callahan

Rosemont Seneca

401 Greenwich Street, Suite 400 | New York NY 10013 | 212-933-9965 |
212-796-4037

1010 Wisconsin Avenue, Suite 705 | Washington DC 20007 | 202-333-1880

917-945-9516 (mobile)

866-749-8879 (fax)


From: Michael Andrews [mailto:mandrews@ips.edu]
Sent: Tuesday, December 21, 2010 11:37 AM
To: Devon Archer; Curtis Hastings; Hunter Biden; Eric Schwerin; Neil
Callahan
Subject: China frets about spreading EU debt - SCMP


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China frets about spreading EU debt


Reuters in Beijing
1:21pm, Dec 21, 2010


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China urged European authorities to back their tough talk with action on
Tuesday by showing they can contain the euro zone's simmering debt problems
and pull the bloc out of its crisis soon.

China, which has invested an undisclosed portion of its US$2.65 trillion
reserves in the euro, said it backed steps taken by European authorities so
far to tackle the region's debt problems, but made clear it would like to
see the measures having more effect.


"We are very concerned about whether the European debt crisis can be
controlled," Chinese Commerce Minister Chen Deming said at a trade dialogue
between China and the European Union.

"We want to see if the EU is able to control sovereign debt risks and
whether consensus can be translated into real action to enable Europe to
emerge from the financial crisis soon and in a good shape," he said.

Concerns that Europe's debt problems will spread beyond euro zone's
periphery to engulf bigger economies such as Spain and Italy have weighed on
global financial markets this year and taken a toll on the euro.

In part to protect its investments, China has repeatedly expressed its
support for the single currency.

In October, Premier Wen Jiabao promised to buy Greek government bonds once
Greece returned to debt markets, in a show of support for the country whose
debt burden pushed the euro zone into a crisis and required an international
bailout.

China's Vice Premier Wang Qishan said on Tuesday Beijing has done its part
to help ease Europe's problems and held out hope that the crisis could soon
be resolved.

"China supports the slew of measures by EU and IMF to stabilise financial
markets, and China has taken concrete actions to help some European
countries deal with their sovereign debt crisis," Wang said at the opening
of the trade dialogue.

"The EU has taken active measures to deal with the debt crisis, and we hope
the measures can achieve some results as soon as possible," he said.

But he noted risks abound, given weak global demand and volatile financial
markets that are awash in excessive liquidity.

On its part, Wang said China would pursue a prudent monetary policy and
active fiscal policy to ensure the world's second-largest economy can
continue to grow at a solid and a sustainable pace.

The annual trade talks between China and the European Union is a chance for
the two major economies to seek compromise on a number of issues that have
raised tensions in recent months.

China, for one, is concerned by what it sees as growing European
protectionism and trade tariffs.

Minister Chen said Beijing hoped the European Union could recognise China as
a market economy as soon as possible.

China is keen for that recognition as that would make it less vulnerable to
anti-dumping charges under rules of the World Trade Organisation.

Separately, Wang said China also hoped Europe would lift its restrictions on
hi-tech exports to China.

Europe, in exchange, urged China to keep its markets open for European
firms.

"China brought European consumers a large array of affordable products. This
has benefited both of us. But now it is essential for both our economies
that China has an open and welcoming business climate," said European
Commission Vice-President Joaquin Almunia.