Today’s Top Stories an attempt to "kill the company"; a group of US lawmakers sent a letter to BP asking it to create a $20B escrow

Today’s Top Stories

· On the economics front, European Apr. IP came in stronger, China’s May Foreign Direct Investment rose more than expected and Japan’s Business sentiment recovered solidly. The UK’s new Office of Budget this morning cut the forecast for growth in 2011 and subsequent years but also lowered the 2010-2015 budget deficit forecast by GBP22B.

· Spain – Germany sees no reason for European Union aid for Spain, Finance Ministry spokesman Michael Offer said; The European Union said there has been no request for financial aid from Spain or any other EU country.  – Bloomberg

· Holidays - Markets in Australia, China and the Philippines are closed today for holidays

· Muni debt update – neg. WSJ article – says investors are ignoring warning signs in the ~$3T muni market, “raising the risk of a reckoning”….(WSJ) 

· Banks set to lose swaps fight – the FT says banks are set to lose a major lobbying fight and will be forced to spin off their swaps trading desks; Paul Volcker has softened his opposition to the Lincoln amendment (FT) 

· Long Beach port in California shows surprise jump in traffic - The Long Beach and Los Angeles ports released preliminary figures for May Fri. Long Beach showed a 25 percent increase in container traffic from a year ago (CNBC) 

· Europe corporate outlook – CEOs of two of Europe’s largest industrial companies both have upbeat outlooks; in separate interviews w/the FT, the heads of Siemens and Volvo said they saw no signs of a double dip recession (FT)   

· France and Germany are said to have the most exposure to troubled euro countries (WSJ)

· Europe – several ECB officials on Fri cautioned markets that they are overstating the risks coming from Europe; several also defended the euro – Reuters 

· Naked CDS trading - European Parliament lawmakers say in a report that naked credit-default swaps trades should be banned; Market supervisors in the European Union could be given powers to temporarily ban naked short selling of credit default swaps– Bloomberg/Reuters 

· BP - a lot of headlines over the weekend; there are various reports that the US will push for, and the BP board will consider today, creating an escrow account to help pay for the costs of the GOM spill (the London Independent said Obama is being pushed by some senior US lawmakers to "punish" BP w/a ~$100B action againt the company, which would be tantamount to an attempt to "kill the company"; a group of US lawmakers sent a letter to BP asking it to create a $20B escrow).  BP's board is meeting today (Mon) and is considering 1) cutting/delaying the dividend (or making the payment in stock instead of cash) and 2) funding an escrow account.  Obama and UK PM Cameron spoke on Saturday where the US president said he had no intention of undermining BP's value.  Obama is touring the Gulf region Mon and Tues and will be addressing the nation Tues night. 

· Video Games – big week for the industry as E3 kicks off; this morning, THQI updated its financial guidance – THQI announced updated guidance for its fiscal first quarter ending June 30, 2010, and its fiscal year ending March 31, 2011, reflecting lower-than-anticipated sales of UFC(R) Undisputed(TM) 2010, and the strengthening US dollar.

· Afghanistan - the US has discovered nearly $1T worth of mineral deposits in Afghanistan, far beyond any previously known reserves; the find could dramatically alter the Afghan economy and the course of the current war; the country could become the "Saudi Arabia of lithium".  NYT