Thursday, February 18, 2010 – my comments are in italics

• China & US tensions growing on economic front - US officials increasingly view the Chinese
currency’s artificially low peg as a threat to worldwide economic stability; the US plans to press Chinese
officials in the coming months to take action and strengthen the yuan. In addition, US multinational
corporations are becoming increasingly vocal about what they view as anti-competitive practices on the
part of the Chinese – WSJ
• FOMC minutes – takeaways from JPMorgan’s B Kasman – Generally conditions had evolved in line
with expectations -- with the exception of the surprisingly strong inventory contribution to 4Q09
growth. This is good news as everyone was expecting above-trend growth. As such, the minutes note
that "downside risks to the outlook for economic growth had diminished a bit further."
• Financial regulatory overhaul – the Senate and WH are nearing agreement on forming a council of
regulators, led by the Treasury secretary, to identify systemic financial risks; a deal would resolve one of
the most contentious issues holding up a bill; the move would mean reduced powers for the Fed
although Bernanke is in favor of the compromise. – NYT
• States see ~$1T benefits “sinkhole” – there is a massive gap between what states have promised in
pensions, health care, and other benefits, and the available resources. WSJ – isn’t that true for the
Federal government also?
• US education policy – bipartisan group of lawmakers to make announcement Thurs of effort to
rewrite “No Child Left Behind” Washington Post – In spite of all the near term political & economic
‘noise,’ educations is probably the most important long-run issue for our country.
• SPG, General Growth – SPG warned General Growth that it may drop its proposed takeover offer or
go hostile; some analysts think the bidding war could attract others and ultimately drive General
Growth’s shrs to $12-15 – WSJ

General Growth Properties – up ~43% in the two days since SPG’s bid