PARIS (AFP) – European stock markets sprinted ahead Monday, powered by strong gains in Asia, with Frankfurt breaking through the 6,000-point barrier and Paris closing in on 4,000 points.

Trading volumes were thin in post-Christmas exchanges and the London market was closed for a holiday.

The advances in Europe followed a solid performance in Asia, where Tokyo&&9;s Nikkei-225 index added 1.33 percent to close at 10,634.23, its best finish since August 26, on the back of a weaker yen and upbeat economic data.

The German Dax index of leading stocks breached 6,000 points as trading began on Monday, the first time it had reached the benchmark since September 26, 2008.

The index opened at 5,977.99 points but moved to 6,001.38 points in early trade. By midday it was up 0.74 percent at 6,001.43.

Shares in the biggest German energy group, E.ON, rose 2.28 percent to lead the gainers while auto maker Volkswagen added 1.40 percent.

In Paris the CAC 40 had risen 0.72 percent to 3,940.95 from Thursday&&9;s close while the Eurostoxx index of leading eurozone shares was up 0.76 percent at 2,979.83.

The Paris market last week recorded consecutive daily gains from Monday to Thursday, ending the period at its highest level for 15 months.

Market watchers said the 4,000-point threshold could be reached later this week. But analysts cautioned that the advance would likely reflect weak trading volumes rather than increased confidence in global economic recovery prospects.

Nuclear energy group Areva fell 2.74 percent in early Paris trade after a French industrial alliance was passed over by the United Arab Emirates in bidding for the construction of four nuclear power plants cash advance to savings account.

The UAE awarded the 20.4-billion-dollar contract to a South Korean-led consortium, the Korea Electric Power Corporation (KEPCO).

Areva had been joined by France&&9;s top energy firms, EDF, GDF-Suez and Total, along with engineering giants Vinci and Alstom to present the bid.

EDF, GDF-Suez, Total, Vinci and Alston shrugged off the loss and gained ground early Monday.

In Tokyo earlier in the day better-than-expected factory output data for November cheered investors.

Nippon Oil surged 4.8 percent and Nippon Mining Holdings leapt 5.4 percent after the Nikkei reported that the two companies would slash their combined oil refinery capacity after a planned merger.

"Overcapacity has been a major problem for the sector, so this is definitely a positive," said Tokai Tokyo Research Center analyst Katsumi Hosoi.

Exporters got a boost from the weaker yen while steel makers were lifted by the robust industrial production numbers, which raised optimism about the outlook for demand for their products.

Elsewhere in Asia there were gains of 1.51 percent in Shanghai and 0.63 percent in Singapore. In Hong Kong shares fell 0.17 percent.

On Wall Street traders were reportedly set to close out 2009 on a high note, with markets expected to hold on to solid gains after staging a remarkable turnaround from a chaotic start to the year.

European stocks climb after Asian gains

AMSTERDAM (Reuters) – Shares in Dutch luxury carmaker Spyker soared on Monday after the company made a new bid for General Motors&&9;s Swedish car brand Saab.

The partly Russian owned Spyker said on Sunday it had lodged a renewed fast-track offer to buy Saab from GM just two days after last-ditch talks with GM over a rescue of the loss-making Swedish manufacturer collapsed. The offer from Spyker Cars expires at 2200 GMT (5 p.m. EST) on Monday.

Shares in Spyker Cars rose as much as 34.5 percent and were up 26.9 percent at 2.17 euros by 1051 GMT (5:51 a.m. EST) in Amsterdam as its renewed approach to Saab raised hopes the small Dutch firm may exponentially expand operations and perhaps become profitable.

"The stock&&9;s value is close to nothing but if they succeed to buy Saab, invest, and turn the company around then the shares can become valuable," said a Dutch analyst who declined to be named.

Abandoning the 60-year-old Swedish auto brand would eliminate 3,400 jobs in Sweden and hit 1,100 Saab dealers, but General Motors said on Sunday it would evaluate several new expressions of interest for Saab.

Spyker, which Russian banking tycoon Vladimir Antonov holds an almost 30 percent stake in, said on Sunday it submitted a renewed offer including an 11-point proposal addressing issues that arose during the due diligence process.

Russian state-controlled Sberbank and Canada&&9;s Magna tried to buy a stake in GM&&9;s Opel unit until GM decided to keep it last month business cards. Russia is keen to obtain Western technology to re-energize its local car industry.

"We&&9;re very confident we have put forward a proposal that can convince GM in time," Spyker Cars Chief Executive Victor Muller told Reuters in a telephone interview on Sunday.

"The jury&&9;s still out. We will see what happens next."

The new offer eliminates the need for a European Investment Bank (EIB) loan approval prior to year end, which would allow the deal to be concluded within GM&&9;s deadline of December 31.

"We can&&9;t comment on this deal as this is something between Spyker and General Motors," said Eric Geers, spokesman for Saab Automobile.

Paul Akerlund, local union leader at Saab in Trollhattan, said: "It&&9;s positive. It shows that there is a genuine interest in buying (Saab), but now the ball is in GM&&9;s court and I don&&9;t know how GM views this. That remains to be seen."

Spyker, maker of the C8 Aileron and D8 luxury sport-utility vehicle, got rescue financing in 2007 from Abu Dhabi&&9;s sovereign fund Mubadala, which holds 23 percent of the company, while Spyker Chief Executive Victor Muller owns 10 percent.

(Reporting by Gilbert Kreijger and Aaron Gray-Block in Amsterdam and Nick Vinocur in Stockholm)

Spyker shares soar as GM mulls new offer for Saab

PARIS &S212; Spyker Cars, the tiny Dutch automaker whose last-ditch bid for Saab was rejected Friday by General Motors, came back Sunday with a renewed offer for the struggling Swedish icon, which G.M. has said it plans to shut down.

A spokesman for G.M. reacted cautiously to Spyker&S217;s new offer, which many industry insiders consider a long shot. However, he said other potential buyers had expressed interest in Saab since Friday&S217;s announcement.

&S220;We continue to wind down Saab but during that process we&S217;ve received several expressions of interest and we evaluate these offers as they come, but beyond that we&S217;re not making any comment,&S221; said Chris Preuss, the G.M. spokesman.

G.M. said Friday that it did not think a deal could be concluded by its Dec. 31 deadline because of concerns about Spyker that arose during the final negotiations. G.M. said that left it no alternative but to begin winding down Saab&S217;s operations in Trollhattan, Sweden.

Upping the ante Sunday, Victor Muller, Spyker&S217;s chief executive, said he had presented G.M. with an 11-point proposal that addressed the automaker&S217;s concerns. He imposed a deadline of his own of 5 p.m. Eastern Standard Time on Monday for G.M. to respond to his offer.

&S220;Despite our collective 11th-hour set-back, we are returning to the table with a renewed offer that addresses every known issue brought to light during the initial negotiations and that has the full backing of the Saab Management,&S221; Mr. Muller said in a statement.

Publicly, G.M. executives declined to identify their problems with Spyker, but several officials familiar with the negotiations said G.M. was troubled by Spyker&S217;s reliance on Russian loans to finance the deal, as well as the fate of its proprietary technology under Spyker.

The biggest investor in Spyker is the Russian bank Convers Group, which is controlled by Alexander Antonov, a tycoon who was shot seven times and reportedly lost a finger in a failed assassination attempt in Moscow in March.

His son Vladimir, 34, is a top executive at Convers and chairman of Spyker.

In the first half of 2009, Spyker borrowed &S364;11.6 million, or $16.6 million, from Bank Snoras, a Lithuanian bank also controlled by the Antonovs.

Another snag had been the question of whether Spyker could win a &S364;400 million loan from the European Investment Bank that had been part of an earlier plan to sell Saab to Koenigsegg, a Swedish maker of high-end sports cars. That deal collapsed last month.

In his statement Sunday, Mr. Muller said Spyker, whose specialty sports cars retail for roughly a quarter-million dollars each, could complete the deal without the European Investment Bank&S217;s help.

&S220;The new offer eliminates the need for an E.I.B. loan approval prior to year-end, for example, which will allow the deal to be concluded within G.M.&S217;s deadline,&S221; he said.

&S220;Our company motto is nulla tenaci invia est via &S212; for the tenacious no road is impassable,&S221; Mr. Muller added. &S220;And we intend to remain true to that throughout these negotiations as we bid to secure Saab&S217;s future and revive the company.&S221;

In Trollhattan, which was hit hard by Friday&S217;s announcement, the new Spyker offer provoked a brief flurry of hope.

&S220;It&S217;s good news, of course, but it&S217;s difficult to say too much,&S221; said Paul Akerlund, chairman of the IF Metall union at Saab, which represents about 1,500 of the automaker&S217;s 3,500 employees in Trollhattan infrared heaters. &S220;Now we&S217;re waiting to see what G.M. says, but we know Spyker really wants to buy Saab.&S221;

&S220;People still have hopes but they&S217;re waiting on G.M.,&S221; he added.

Saab was set to introduce a new version of its 9-5 luxury sedan in showrooms in April, the first update of the company&S217;s top-end car in 12 years. But G.M. said Friday the car would not make it to market if Saab does indeed shut down.

The region around Trollhattan and Gotenburg in western Sweden is home to both Saab and Volvo, and Saab&S217;s collapse would devastate the network of parts makers and other firms that supply the two companies.

On Saturday, the Swedish press reported that a consortium of local investors was considering a new bid for Saab, which, along with Volvo and Ikea, is among the country&S217;s best-known brands.

Even as the Saab drama plays out, Volvo Car is in the final stages of being sold by Ford Motor to Zhejiang Geely Holding of China.

After G.M.&S217;s decision to walk away Friday, Mr. Akerlund said, &S220;some people were frustrated, some were angry and some were sad. Maybe this new offer can help so we can have a solution at the end of the day.&S221;

Since the beginning of the year, G.M. has been trying to unload Saab, which has been a perennial money-loser despite a devoted following in Scandinavia, the northeastern United States and parts of Europe.

With sales of just 93,000 cars worldwide, Saab proved too small to draw the interest of bigger automakers that are looking to global alliances to achieve new economies of scale. That left the field of bidders to far smaller companies like Koenigsegg and now Spyker.

Turning around Saab would be a huge challenge for Spyker, given G.M&S217;s. inability to turn a profit at the subsidiary as well as Spyker&S217;s lack of experience in mass car manufacturing. Spyker sells 30 to 50 high-performance sports cars a year, which are made to individual order.

&S220;It&S217;s something of a long shot, and I wonder if Spyker has the depth of management to deal with a company the size of Saab,&S221; said Peter Wells, co-director for industry research of the Center for Automotive Research at Cardiff University in Wales. &S220;I don&S217;t think Spyker can float Saab for a significant amount of time,&S221; he said.

The longer Saab&S217;s fate hangs in the balance, he added, the longer the odds of saving it.

&S220;Every day that goes by the brand gets more damaged, especially in the eyes of consumers,&S221; Mr. Wells said. Despite Saab&S217;s famously loyal customer base, he said, &S220;it&S217;s very difficult to recover from that.&S221;

Even if the Spyker bid fails &S212; and other buyers don&S217;t emerge to rescue Saab &S212; G.M. said warranties will still be honored and Saab owners around the world will still be able to find parts and service.

In all, 1,100 dealerships worldwide will be affected, including about 200 in the United States.

Tiny Automaker Renews Saab Offer

NEW YORK (MarketWatch) -- U.S. financial stocks rose in morning trade, led by gains in select retail investment firms as analysts grew more sanguine about their outlook. T. Rowe Price and Charles Schwab led gainers following an upgrade of both at Deutsche Bank.

On the downside, Citigroup shares fell after news that Abu Dhabi's sovereign wealth fund wants out of a commitment to invest more than $7 billion in the firm.

The Financial Select Sector SPDR , which tracks the financial stocks in the S&P 500, added 0.7%.

Shares of Citigroup faced a new challenge Wednesday. Abu Dhabi Investment Authority, the Middle East's largest sovereign wealth fund, is demanding that Citigroup Inc. scrap a deal that would see the fund make a heavy loss on a $7.5 billion investment in the bank.

The fund, controlled by the oil-rich rulers of the Persian Gulf city-state of Abu Dhabi, is seeking more than $4 billion in damages from Citi if the deal to invest in the bank is upheld for what it alleges were "fraudulent misrepresentations" of the original agreement, according to the lender.

The dispute with Abu Dhabi follows Kuwait's decision to sell its stake in Citi. The Kuwait Investment Authority, the Gulf country's sovereign-wealth fund known as the KIA, said this month it sold a $4.1 billion stake in Citigroup Inc., for a $1.1 billion profit. Shares of Citigroup fell about 3% in the early going. Read more about the Abu Dhabi, Citi spat.

Asset manager Franklin Resources also fell. It shed about 1.8% as Deutsche Bank analyst recommended clients sell it and buy rival T. Rowe Price , which rose 1 best auto loan rates.8%.

"While core trends at both firms have been solid, including strong investment performance, healthy relative flows, and significant margin improvement, industry trends have favored Franklin since June, which aided its outperformance versus the sector." The analysts concluded.

"That said," they added, "over the next 12 months, we expect industry trends to begin to favor T. Rowe Price, including improving 401k flows, a pickup in institutional flows, and a gradual shift into equities, which should drive its relative outperformance."

The analysts downgraded Franklin to hold, and upped T. Rowe Price to buy.

Also moving on analyst comments, Charles Schwab shares added 2.1%.

Deutsche Bank analysts upgraded the stock to buy from hold, and raised their price target to $25 from $18.

"Schwab has maneuvered well during the downturn, and while the stock has underperformed due to significant rate pressures, the firm is well-positioned to benefit on multiple fronts (flows, rates, and margins) as conditions improve," Deutsche Bank said in a research note.

The analysts said the call could be premature, but they think the risk is justified since they view estimates at our near "trough levels" and forecast earnings-per-share growth in the range of 60% to 80%, or more, in the next two to three years. They said they expect Schwab to outperform over the next 12 months.

Financial Stocks: Financials mixed as Citi slips on Abu Dhabi claims

Hot News: Market Snapshot: U.S. stocks dip after PPI data; dollar rises

On-the-job training has its roots in the Middle Ages. Apprenticeship, it was called then, and it generally was for the young.

The new variation, now called an internship, is not the painstaking, multiyear experience it once was, but it still offers the same advantages: a chance for a worker to gain knowledge at little or no cost to the employer.

In boom times, companies with too much work for existing employees &<51; yet not enough work to justify another hire &<51; may have turned to temporary workers. But with the economy still in the doldrums, companies again are opting for unpaid or low-paid internships to get the extra work done.

It is a brilliant, recession-proof way to double your work force, said Drew McLellan, whose McLellan Marketing Group in Des Moines has long hired unpaid interns. &S220;It&S217;s more money to the bottom line for you.&S221;

While there are no definitive numbers on how many internships exist or how many companies offer them, most are probably at smaller companies and nonprofit groups rather than large public companies, according to Internships.com, a placement service with some 13,000 listings. C. Mason Gates, the president and founder of Internships.com, said that with economic uncertainty, smaller businesses would continue to view interns as a source of growth, talent development and project-based work.

Internships have never been out of vogue, but the competition for positions is heating up, which is good news if you run a company needing economical, entry-level workers.

&S220;The importance of an internship has changed from what parents experienced,&S221; said Steve Rodems, senior partner at Fast Track Internships, which charges $799 to help an intern find an unpaid job. &S220;It&S217;s no longer a nice-to-have addition to you r&>33;sum&>33;. Upon graduation, more and more companies are looking for graduates who also have some real-world internship experience.&S221;

One employer who recently hired an intern was Suzan French, who, after four years as an independent public relations consultant in Allentown, Pa., needed help but was not prepared to bring on a full-time employee. In May, she hired Kate Mackes, 21, a finance major at nearby Lehigh University. Ms. Mackes runs clients&S217; social media projects while Ms. French offers old-school instruction in the public relations business.

&S220;Kate was raised on it and is active in it, and that is something I&S217;m still learning,&S221; Ms. French said. &S220;She is able to come in and use social media for the betterment of a client, and I&S217;ve been able to teach her some of the more traditional P.R. and marketing practices that you don&S217;t learn in the classroom.&S221;

Internships run the gamut from marketing and finance to geology, fashion, architecture and entertainment. While some are part of university programs and carry academic credit, others are less formal with nothing changing hands except an occasional lunch.

And internships are no longer just the province of college students. More unemployed professionals are seeking them &<51; whether to test-drive a new career or simply to keep themselves occupied, according to internship placement services. Mr. Rodems, of Fast Track Internships, said 10 percent of his clients were college graduates changing professions, compared with just 1 percent in 2008. And, he said, internships are increasingly running throughout the year, not just in the summer.

Michael Sabatino, 38, an equity analyst at Smith Barney in New York until he was laid off in 2008, is one of those professionals who sought an internship.

He said that, after caring for his newborn daughter for a year, he approached a small fee-only wealth management firm in New Jersey for a full-time position. None were open, so Mr auto loan. Sabatino offered his services free to learn the business.

He ended up earning $10 an hour &<51; far less than his family&S217;s living expenses &<51; and had no job offer at the end of his five-month stint. But he described the position as a turning point, in part, because it exposed him to the daily challenges of running a small business and demonstrated to potential employers his passion for serving clients and developing his technical expertise.

&S220;The internship was a key transitional experience in my career that positioned me for a long-term opportunity in a wealth management organization,&S221; Mr. Sabatino said. He is interviewing with boutique wealth managers.

Connie Rivera, 57, also used an internship to change careers after she left her job as chief executive of the American Dietetic Association in Chicago in 2000 to pursue her passion for gardening.

She got a job at a local garden center to learn the business. For 18 months she did grunt work &<51; answering customer telephone calls, watering plants, helping with payroll, she said. In 2003, she opened her own garden and landscape business. She now has 42 employees &<51; and one intern &<51; and says she expects to have $4 million in revenue by Dec. 31.

&S220;I took a $250,000 pay cut, but it was the kind of research I needed to do to write my business plan,&S221; Ms. Rivera said.

While menial tasks often go with the territory, the best internships interpose photocopying with client meetings, true-life assignments and mentoring.

&S220;A company gets as much from an intern as the intern gets from the company &<51; if it&S217;s a good internship,&S221; said Lalia Rach, dean of the Tisch Center for Hospitality, Tourism and Sports Management at New York University.

For employers, setting up an internship program is relatively easy and inexpensive. Veterans of the hiring process say business owners interested in offering internships should develop relationships with local college professors who can choose good intern candidates and seek legal advice to ensure that federal and state labor laws are followed. Business owners should have a clear idea of what they want from an intern and then interview candidates in the same way they do potential regular employees.

Mr. McLellan, from the Des Moines marketing company, said several of his interns had been hired at or opened marketing shops.

&S220;The reward as a business owner is knowing you gave them a little boost,&S221; he said. &S220;And it&S217;s fun to watch them take it wherever they are going to take it.&S221;

While most interns receive no money &<51; and others slightly more than the $7.25 hourly minimum wage &<51; interns are not exactly free. At least initially, it is more efficient for managers to do something themselves than to train someone. Also, while most interns are go-getters, exams and socializing can interfere.

Consuelo C. Bova, chief executive of ForTheFit.com, an online clothing retailer, brought on her first unpaid intern last February to do marketing and public relations. Ms. Bova said she was so impressed with the intern, a University of Central Florida junior, that she hired her as a part-time assistant after the internship ended in April. In August, Ms. Bova interviewed candidates to fill another intern opening &<51; this time a paid position.

&S220;Those I have interviewed to date have been, at worst, merely qualified and capable of doing the job, and at best, exciting, enthusiastic, experienced and capable of delivering high-quality work for our company,&S221; Ms. Bova said.

Hiring Is Rising in One Area: Low-Paid Interns

CHICAGO (MarketWatch) -- After months of paying off debt, some Americans pulled out their credit cards and started charging in October, according to data from two credit tracking firms. The data suggest consumption habits don't ever really die, especially when the busiest shopping season of the year is at hand.

Synovate Mail Monitor and Credit Karma both said that average credit-card balances increased as consumers added new purchases. But Synovate also said that credit-card consolidation contributed to higher average balances.

The most recent government figures for consumers' use of credit are from September, when the Federal Reserve said outstanding consumer credit fell at a 7.2% annual rate, the eighth straight month of declines.

How much do you pay for your 401(k)?

Few investors know what they're paying in administrative and other fees for their 401(k), but there are ways to find out, says Ryan Alfred, president of BrightScope, a retirement-plan ratings and research firm. MarketWatch's Andrea Coombes reports.

Meanwhile, the U.S. Commerce Department said Monday that October sales increased more than expected, thanks mostly to an appetite for new cars, but also due to consumers buying a variety of other goods.

"It's silly to expect people to have a complete change in the model of how they buy things forever -- and especially in the holiday season," said John Ulzheimer, president of consumer education for Credit.com.

Synovate Mail Monitor, which tracks credit-card acquisition volume and response rates throughout the U.S., saw average balances edge up about 8% to $8,083 in the third quarter, from $7,489 in the second.

CreditKarma.com, a consumer research and credit-score site that follows a smaller percentage of cards, saw a bigger jump in card usage in October, with the average consumer carrying $7,573 of credit-card debt, a 14% increase from $6,641 a month earlier.

The holidays typically account for some 40% of spending at national retail stores with most shopping done in the four to six weeks before Dec. 25. But this year, Christmas came sooner as retailers began promotions and discounts as early as July.

"The seasonal aspect can be pretty strong," said Ken Lin, founder of Credit Karma. "Consumer spending is so much higher in the fourth quarter than any other quarter of the year."

Tighter limits also push balances higher

Anuj Shahani, director of competitive tracking services for Synovate, agrees that consumers are spending a little more but said the bigger impact on balances is a result of fewer cards and tighter credit limits in force payday loan lenders.

By Synovate's estimation, the average number of credit cards per household slipped to 2.8 in the third quarter from three in the first quarter. Many consumers saw their credit limits slashed, so some transferred their charging to one or two main cards. Consequently, the average balances went up.

Of course, one month does not make a trend. But if Americans' love affair with their credit cards is reheated, the eight months of steadfastly paying down debt may turn out to be nothing more than a temporary hiatus from credit cards.

"I don't see many people staying on the wagon and completely giving up credit cards permanently," said Credit.com's Ulzheimer. "As much as it pains me to say this, the best vehicle for buying things on a convenience basis is a credit card."

Sales rise in some sectors

There's no question that the consumer is still gun-shy about spending, despite the 1.4% rise in U.S. retail sales last month. The Commerce Dept. said a chunk of those sales were fueled by new demand in autos, rebounding from the post "cash for clunkers" stimulus crash.

Housing-related merchandise sales were sharply lower and electronic and appliance sales slipped, as did sporting goods and hobby sales.

But restaurant and bar sales, mail order and Internet purchases, and general merchandise sales got a boost -- all indicating that consumers were more flexible in their spending than they've been for most of the year.

What's troubling, however, is that last month also saw a slowdown in the number of credit-card defaults at a time when delinquencies -- mostly those 30 days or more late -- were on the rise. (Defaults, however, are still at high levels at the largest credit-card issuers.)

Delinquencies can be a harbinger of future losses and tend to lag default rates by three to six months. "It doesn't make any sense that delinquency rates are going up and default rates going down," Ulzheimer said. "There may be another wave of defaults coming."

Credit-card balances rise as holidays approach

DETROIT &<51; GMAC Financial Services, the former lending arm of General Motors, replaced its chief executive on Monday as it negotiates for another round of bailout financing from the federal government.

The company&S217;s directors appointed Michael A. Carpenter, a former Citigroup executive and current GMAC director, to succeed Alvaro de Molina, who had run the company since April 2008. Mr. Carpenter said the board believed that he would be more appropriate as chief executive than Mr. de Molina, who resigned at the board&S217;s request.

GMAC, in a statement, said it had asked the Treasury Department to postpone a decision on more aid under the Troubled Asset Relief Program until the new management team had &S220;assessed the current situation and can advise the board and Treasury regarding the appropriate amount and form of such funding.&S221;

GMAC already has received $12.5 billion from the government, which now owns almost 35 percent of the company, but was expected to ask for as much as $5.6 billion more this month. This year, the Treasury told GMAC, based on the results of stress tests to evaluate its liquidity, that it must raise $11.5 billion in capital by the end of November.

GMAC, a 90-year-old auto and home lender that was converted to a bank holding company last year to qualify for bailout financing, is the only bank of the 19 subjected to the stress tests that has been unable to borrow more capital from private investors.

&S220;We don&S217;t see any need for the maximum amount of capital that Treasury was anticipating putting in,&S221; Mr. Carpenter, 62, said in an interview.

&S220;The $5.6 billion is off the table business cards design. What the exact number is, I don&S217;t know.&S221;

Mr. Carpenter, who resigned from the board of the CIT Group to focus on his new position, said the board was not pressured by regulators to request Mr. de Molina&S217;s resignation.

GMAC is now the primary lender to dealers of both G.M. and Chrysler, and it provides financing to customers of both automakers as well. It also operates Ally Bank, an online retail bank.

The company lost $5.3 billion in the first nine months of the year.

Mr. Carpenter said he wanted GMAC to provide a financial backbone to a revitalized G.M. and Chrysler and to be able to repay most, if not all, of its financial lifelines.

Initially, many of GMAC&S217;s problems were created by subprime lending at its home mortgage unit, which racked up hundreds of millions of dollars in losses. The trouble was compounded by a severe slump in auto sales and a tightening of credit markets that in late 2008 virtually eliminated GMAC as a financing source for G.M. customers.

&S220;I came to GMAC thinking that it was a short-term assignment working through a liquidity crisis,&S221; Mr. de Molina, 52, said in Monday&S217;s statement. &S220;That crisis lasted two years. With the help of government support and the incredible efforts of our team, we are now on stable footing, positioned for profitability in 2010 and beyond.&S221;

Michael J. de la Merced contributed reporting from New York.

A Change at the Top of GMAC as It Negotiates for Another Government Bailout

BEIJING, Nov. 15 (Xinhua) -- China should enhance supervision and management of the country's insurance investment, said Li Kemu, vice chairman of the China Insurance Regulatory Commission (CIRC),on Sunday.

"With insurance funds were extended into disparate fields, other than bank deposit, demand for a better supervision and risk control enhanced, said Li at the International Finance Forum held in Beijing.

By the end of September, 3.4 trillion yuan (497.8 billion U.S. dollars) of insurance funds were invested in bonds, mutual funds, and stocks markets. Bonds investment alone accounted for 50.6 percent of the total.

Jiang Dingzhi, China Banking Regulatory Commission (CBRC) Vice Chairman also highlighted the importance of establishing a "all-coverage" financial supervision system guaranteed online payday loans.

He suggested the country broaden the financial supervision and management system, which would put the mutual funds, hedge funds, and credit risks appraisal agencies under control.

The new system requires financial institutions to share information, and also cooperate to fill the supervision blanks between different financial markets, he said.

Chinese insurance regulator stresses supervision on insurance investment

OTTAWA &<51; When English-speaking Canadians watch the television news, most of them choose among the Canadian Broadcasting Corporation, CTV or Global Television. But the prime minister, Stephen Harper, said in a speech last week that he preferred another choice: American news.

&S220;I don&S217;t like to watch Canadian news,&S221; Mr. Harper told the Canadian Chamber of Commerce in Toronto on Wednesday, adding that he doesn&S217;t like to see himself analyzed. &S220;So my hobby is to watch politics elsewhere.&S221;

Of course, a statement like that plays into Canada&S217;s inferiority complex. While some people, including other members of the Conservative Party, suggested later that Mr. Harper might have been joking, his spokesman, Dimitri Soudas, confirmed that the prime minister avoided Canadian news broadcasts, but not all Canadian programming.

&S220;He definitely enjoys watching a good hockey game,&S221; Mr. Soudas said.

&S220;It&S217;s completely bizarre,&S221; said Bob Rae, a prominent member of Parliament for the opposition Liberal Party. &S220;Imagine if Sarkozy said: &S216;I don&S217;t watch the French news, just the BBC&S217; or Obama said he only watches Canadian news.&S221;

Peter Mansbridge, host of the CBC&S217;s flagship news program, &S220;The National,&S221; noted that a past prime minister, Pierre Elliott Trudeau, used to say he avoided Canadian media &S220;because he didn&S217;t care what they said free credit reports.&S221;

Nevertheless, Mr. Mansbridge seemed a little baffled.

&S220;It&S217;s a strange signal to send to the public at a time when Canadian networks, aside from covering this country, which U.S. networks don&S217;t, also spend considerable resources, and some of their correspondents literally risk their lives, to bring the Canadian perspective on international stories home from places that some U.S. networks ignore,&S221; Mr. Mansbridge wrote in an e-mail message.

Still, there is one regular viewer inside the official residence. Mr. Mansbridge said that Laureen Harper, the prime minister&S217;s wife, has told &S220;The National&S221; not only that she is a viewer but also that she &S220;even downloads the podcast of our regular Thursday night political panel and then often briefs her husband on what was discussed.&S221;

For News, Canada’s Leader Looks South of the Border

SINGAPORE (Reuters) – Singapore&&9;s largest sovereign wealth fund GIC said on Tuesday it had halved its stake in Citigroup (C.N) to below 5 percent, making a profit of &&6;1.6 billion as global equity markets rebound.

The stake sale came after Singapore&&9;s smaller fund Temasek Holdings lost an estimated over &&6;4 billion in Bank of America-Merrill Lynch (BAC.N) and Barclays (BARC.L) in hasty exits around the start of 2009.

Analysts said GIC, also known as the Government of Singapore Investment Corp, took advantage of a rally in world stocks to take some money off the table and the sale suggested the fund may have some concerns about the outlook for global banks.

"Perhaps timings wise GIC benefited from the rally," said Song Seng Wun, an economist at CIMB.

"The sale also reflects underlying concerns that although global institutions may have seen their darkest days, there could still be uncertainty ahead as OECD countries in particular could see patchy growth as a result of the recession," he said.

From late 2007, GIC plowed billions of dollars into Citigroup and UBS (UBSN.VX) and like other sovereign funds, had suffered initial losses in battered global banks as the financial crisis hit companies no fax needed payday loans.

Ng Kok Song, group chief investment officer of GIC, which manages an estimated &&6;200 billion-plus in assets, said the fund realized a profit of &&6;1.6 billion from the sale of Citigroup shares.

The Singapore investor had a profit including unrealized gains of about &&6;3.2 billion based on Citigroup&&9;s closing price of &&6;4.43 on Sept 21, he said.

On Sept 11, GIC exchanged its &&6;6.88 billion holding of Citigroup convertible preferred stock into ordinary shares at &&6;3.25 a share as part of a rescue package, gaining in the process an over-9 percent stake in the U.S. bank.

"A stake below 5 percent reflects GIC&&9;s goals and desire to be a portfolio investor," it said in a statement. "GIC will continue its investment in Citigroup as we are confident of its long-term prospects." (Reporting by Kevin Lim and Saeed Azhar; Editing by Anshuman Daga)

GIC trims Citi stake to below 5 percent

CROMVOIRT, the Netherlands &<51; Putting aside for the moment the advisability of trying to make a living milking camels, you would not think it a particularly difficult business.

But you would be wrong.

The camels grazing on this green patch of farmland a few miles outside of Den Bosch may look happy enough. But milking them is another story; moody camels are known to spit and kick, and mares will give milk only when one of their offspring is nearby.

&S220;You have to show them respect,&S221; said Frank Smits, the proprietor of the camel farm. &S220;They&S217;re a lot more stubborn than cows.&S221;

Mr. Smits, currently the only farmer in Europe with permission to sell camel&S217;s milk, is just as stubborn as his camels. Since starting his farm in 2006, he has run afoul of the European Union, which forbids the importation of camels, animal rights advocates and the Dutch agricultural authorities.

Mr. Smits, 26, saw an untapped market for camel&S217;s milk in the rising number of immigrants to Europe from Somalia and Morocco, where camel&S217;s milk has long been popular for its supposed curative properties. Mr. Smits&S217;s milk sells for upwards of $15 a quart at a few dozen Islamic groceries and health-food stores throughout the Netherlands, with the rest exported to immigrant communities in Belgium, Germany and Britain.

In muddy jeans and boots, Mr. Smits looks every bit the young farmer. Turns out, though, that his father is a neurologist, and that he studied both marketing and agriculture at college.

And there is one thing he wants everybody to know: he&S217;s not in it for the money.

&S220;Working as a checkout boy at the supermarket would pay better,&S221; he said. The camels cost about $11,000 each, he said, and one camel produces only about a gallon and a half of milk per day.

His motivation was a 2006 report from the Food and Agriculture Organization of the United Nations, which has been promoting camel&S217;s milk not only for its nutritional value but also as a revenue source, especially for the nomadic farmers who have been milking camels for millenniums. The report said the market for camel&S217;s milk products could be as large as $10 billion.

Mr. Smits&S217;s professors at college were so taken with the idea, they almost flunked him. His final thesis, on the feasibility of introducing camel&S217;s milk to the European market, earned him the American equivalent of a D-minus.

&S220;They just didn&S217;t understand it,&S221; Mr. Smits said. &S220;I used a lot of research and literature from the F.A.O., but my teachers said the literature I used wasn&S217;t scientific enough. Then I used that same paper to apply for grants and loans, and it worked fine.&S221;

Simply getting the camels was no small feat. The European Union does not allow them to be imported, so Mr. Smits had to find some from within the trading bloc. He managed to do so in the Canary Islands off the coast of Africa, which belong to Spain, a member of the union. Mr. Smits shipped in three pregnant females, and soon began milking them on a small plot of land next to his dormitory in Den Bosch american family insurance.

Local animal-welfare groups cried foul, arguing that the nation already had enough exploited animals. Tamping down that controversy, he managed to get his operation up and running, only to have it shut down a few months later by the Dutch agricultural authorities because camels were not on the official list of commercial farm animals.

Mr. Smits paid to have a Dutch government agency investigate whether camels could be added to that list, which meant having to demonstrate that he could run the farm &S220;without unacceptable animal welfare consequences.&S221; Foxes and chinchillas were removed from the list in 2008, with mink to follow in 2018. But the authorities gave Mr. Smits the go-ahead, granting him a two-year trial period, presumably to show he could milk his camels humanely. That period was recently extended for another two years, until the end of 2010.

Whatever curative properties camel&S217;s milk may have are thought by its devotees to disappear if it is pasteurized, a belief that has limited its distribution &<51; unpasteurized milk is generally forbidden in Europe and the United States.

But Mr. Smits managed to obtain permission to produce unpasteurized camel&S217;s milk, which he does with the help of an automated milking machine he developed with a dairy equipment manufacturer. Some experts estimate that a camel&S217;s daily output could ultimately be raised to as much as five gallons using modern equipment and methods.

Expanding markets is proving to be at least as difficult, with the bans on unpasteurized milk and a ban on camel&S217;s milk altogether in the United States.

But things are looking up. The Food and Drug Administration recently agreed to add camel&S217;s milk to its list of salable products in the United States, but it still cannot be sold or imported for human consumption until it passes a battery of tests. An agency spokesman noted that these things take time &<51; water buffalo milk was approved in 2003, but it took until 2009 before all the tests were completed.

There are several studies under way into the health benefits of camel&S217;s milk. At nearby Wageningen University, for example, researchers are investigating whether camel&S217;s milk can provide some help for people with diabetes. The results are not yet in.

For Mr. Smits, milk is only the beginning. Last year he developed a camel&S217;s milk cheese that sells for around $60 a pound, and he hopes to introduce bread to the world&S217;s growing array of camel&S217;s-milk products, like chocolate, ice cream and soap.

He now owns about 40 camels in Cromvoirt, roughly 10 of which can be milked. He has not applied for European farm subsidies, he says, because the paperwork is too overwhelming.

To make a profit, Mr. Smits said he needs a herd of about 120, a goal he hopes to reach before 2015. He is on the lookout for a bigger farm.

Cromvoirt Journal: The Camel as Cow, a Cautionary Tale

LONDON (Reuters) – The G20 will promise this weekend to keep economic support packages in place until recovery is certain and seek to reassure financial markets they have credible plans to withdraw the stimulus when appropriate.

Finance ministers and central bankers from the Group of 20 developed and emerging nations are meeting in London to discuss the economic outlook, curbs on bank bonuses, tighter financial regulation and reform of international institutions.

Since their leaders met in April in the midst of the worst global recession since the Great Depression, prospects for the world economy have improved with growth returning in a number of countries and stock markets powering ahead.

But policymakers are cautious about declaring victory yet.

"Unwinding the stimulus too soon runs a real risk of derailing the recovery, with potentially significant implications for growth and unemployment," said International Monetary Fund chief Dominique Strauss-Kahn at a conference in Berlin on Friday.

G7 sources have told Reuters that the G20&&9;s communique, due on Saturday, will likely maintain the pledge to keep policy accommodative for as long as was needed.

"The biggest risk is to think that the job&&9;s done -- that recovery is guaranteed. No country can be complacent -- we&&9;ve got to see this through," British finance minister and meeting host Alistair Darling said late on Thursday.

Still, with interest rates at record lows and trillions of dollars thrown into their economies to fight the crisis, policymakers are also keen to show they have exit strategies in place lest financial markets take fright that inflation will rocket and public finances fall apart.

"Now is not the time to exit. But I would like to make it clear that the ECB has a strategy, and we stand ready to put it into action when the appropriate time comes," said European Central Bank President Jean-Claude Trichet said in Frankfurt.

BONUS CURBS

With unemployment still likely to rise for a while and eat into incumbent government poll ratings, the politicians are also looking for someone to blame and will stress that banks cannot return to business as normal paydayloans.

France, Germany and Britain on Thursday put forward joint proposals to change the bonus culture at banks that many say was the root of the current crisis. These include deferrals and subjecting payments to clawback but fall short of the tax being advocated by some charities.

Ministers who are laying the groundwork for a leaders&&9; summit in Pittsburgh later this month will also look at enhanced regulation of systemically important banks and ways in which these institutions can be wound up if needed without shaking the financial system.

U.S. Treasury Secretary Timothy Geithner is pressing the G20 to back tough new international standards for bank capital and liquidity. The U.S. Treasury said on Thursday a comprehensive agreement should be reached by the end of 2010, with countries implementing the standards by the end of 2012.

Other issues on the table are ensuring the IMF gets the full resources promised to it at April&&9;s London summit when leaders pledged a mammoth &&6;1.1 trillion increase in the lender&&9;s firepower.

Dinner on Friday will discuss how the IMF and the World Bank can be reformed to reflect better the emergence of the new economic powers.

Representatives from Brazil, Russia, India and China will meet on the sidelines of the meeting and Geithner is expected to join them.

U.S. President Barack Obama&&9;s administration also wants to make climate change a big issue for the Pittsburgh summit and will call on fellow G20 members to eliminate fossil fuel subsidies and increase oil market transparency.

(Additional reporting by Noah Barkin in Berlin, Krista Hughes in Frankfurt, writing by Sumeet Desai, editing by Mike Peacock)

G20 to pledge stimulus until economic recovery certain

DETROIT (Reuters) – U.S. government incentives likely pushed U.S. auto sales to a 20-month high in August, leaving analysts and the industry guessing how hard a landing to expect with the "Cash for Clunkers" program now exhausted.

Automakers could see the U.S. seasonally adjusted rate of sales, a closely watched indicator of demand for big-ticket items, jump to nearly 16 million vehicles in August under the "clunkers" program, analysts said. That would be the highest monthly sales rate since December 2007.

But with the incentive program ended and only heavily picked over vehicles left in inventories, September is expected to be a much leaner sales month, with the severity of the pullback dependent on the U.S. economy&&9;s health.

The annualized sales rate reached 15.8 million vehicles in August under the program, but likely will drop off the rest of the year, although not back to the lows seen early in 2009, Barclays Capital analyst Brian Johnson said in a note.

"We expect sales for the remainder of the year to fall well below August results, but believe momentum from the program as well as the stabilization in the economy and improvement in consumer confidence could boost sales above the 9.5 million average seen in the first half," Johnson said.

Johnson said the seasonally adjusted annual rate could be in the 10 million unit range in September and 10.5 million vehicles for the fourth quarter.

Among U.S. carmakers, Barclays expects Ford Motor Co (F.N) sales to be up 53 percent in August from a year earlier. General Motors (GM.UL) sales, which were strong in August 2008 due to an incentive program, are expected to be down 9 percent and Chrysler Group LLC (FIA.MI) sales up 2 percent, it said.

For Japanese automakers, Toyota Motor Corp (7203.T) sales are expected to be up 22 percent, Honda Motor Co Ltd (7267.T) sales up 20 percent and Nissan Motor Co Ltd (7201.T) sales up 5 percent, Barclays said.

The top 10 "clunkers" program vehicle sales were dominated by Toyota and Honda, which had three vehicles each on the list, and by Ford with two vehicles.

&&9;CLUNKERS&&9; SUPPORT

Dealers submitted 690,114 new vehicle transactions under the "clunkers" program that started in late July and ran out three weeks into August at a cost of about &&6;2.88 billion.

How many of "clunkers" deals landed in August is not completely clear, though U free instant credit reports.S. Department of Transportation data suggests roughly 450,000 sales in August and 240,000 in July.

Also unclear is how many of those August deals would have been completed without the incentives, and whether they were pulled forward from the near future.

"Our only concern is how much of that will truly be incremental volumes as opposed to just borrowing from the future," Rebecca Lindland, director of automotive research at IHS Global Insight, said in an interview.

IHS Global Insight estimated that about 250,000 vehicles were sales that would not otherwise have been made, though that figure could be higher, Lindland said.

Lindland said the annualized rate of sales could be 14.5 million to 15 million units for August, with September falling back to the 9.5 million unit range. A "significant hit" on sales also is expected in the fourth quarter, she said.

"While we are seeing signs of it getting better, the economy is still not in great shape," Lindland said. "It is getting better as opposed to getting worse but we&&9;re still not driving in the fast lane."

On a percentage basis, automakers still may report that industry sales fell in August from a year earlier. The August selling period wraps up on Monday and has 26 selling days, one fewer than in August 2008.

JP Morgan analyst Himanshu Patel said the seasonally adjusted rate could hit 15.3 million vehicles in August, followed by a hangover to perhaps a 9 million unit monthly selling rate from September to the end of the year.

"While the fast-money crowd may over-react to this likely SAAR decline, it is worth stepping back and remembering that in the nine months pre-clunkers, U.S. retail SAAR showed strong signs of sequential stabilization, all but confirming that a bottom had been found," Patel said in a note.

Edmunds expects a seasonally adjusted annual rate of just over 13 million units, with sales tapering quickly toward the end of August after the "clunkers" program ended.

"Ending August on such a low note does not bode well for September," Edmunds.com Senior Analyst Jessica Caldwell said.

(Reporting by David Bailey, Soyoung Kim and John Crawley, editing by Leslie Gevirtz.)

"Clunkers" may boost U.S. auto sales, but investors look beyond

HONG KONG (Reuters) – Asian stocks edged higher on Wednesday, with thin summer trading volumes keeping prices choppy and centered on short-term chart targets, while oil hovered near &&6;72 a barrel, capped by a surprising rise in U.S. inventories.

U.S. single-family home prices grew for a second straight month, a report showed overnight, confirming the recovery is on track.

However, having already priced in an upturn in the global economy, investors were looking for more signs that growth can be sustained once the impact of massive government stimulus spending fades.

Volatility in Chinese shares has also kept investors guessing. The Shanghai composite index is down 14 percent so far in August, on track for the biggest monthly decline since the darkest month of the financial crisis in October 2008.

The precipitous move triggered questions on whether other high flying equity markets were due for a correction. However, to what extent a decline in the Chinese market, which is largely closed to foreign investors, matters for global market trends and perceptions of risk is an open question.

Japan&&9;s Nikkei share average drifted up 0.6 percent, within reach of a 10-month high reached earlier in August.

"The (U.S. economic) data is encouraging because it points to continued economic improvement, but the Nikkei won&&9;t rise that much because investors are a bit wary about the chances of an adjustment. After all, it has risen around 50 percent since March," said Kenichi Hirano, operating officer at Tachibana Securities in Tokyo.

Shares of index heavyweight Toyota Motor Corp (7203.T) rose 1.5 percent on a report the carmaker would cut global production capacity and post an operating profit in the 2010 financial year.

However, while news of the output cut shored up the stock, it also reinforced worries about persistent weakness in global consumer demand, which is key to a solid recovery.

The MSCI index of Asia Pacific stocks traded outside Japan rose 0.1 percent (.MIAPJ0000PUS), weighed by weakness in the technology and consumer discretionary sectors -- two of the most expensive segments of the Asian market.

Hong Kong&&9;s Hang Seng index (.HSI) was up 0.3 percent but remained susceptible to ups and downs in the Shanghai composite index (.SSEC), which was up 0.6 percent.

The Ifo survey of German business sentiment is expected to show an across the board pickup later on Wednesday, playing into the story that recoveries are taking hold around the world.

However, in a worrying development, Japan&&9;s exports slipped in July as annual drops in exports to the United States and China accelerated, in a sign that the impact of stimulus measures in major economies worldwide may be starting to wane.

"Things have stopped getting worse, but a return to trend gains in production and trade is a pipe-dream," Patrick Bennett, Asia foreign exchange and rates strategist with Societe Generale in Hong Kong, said in a note.

U.S. oil futures for October delivery were largely unchanged on the day around &&6;72 after a 3 percent drop overnight on profit taking after the market was unable to push crude above &&6;75 a barrel.

Inventory data from the American Petroleum Institute late on Tuesday showed a big buildup in U.S. crude oil stocks last week, keeping a lid on the market.

Still, that appeared only a short-term setback. Analysts raised their 2010 median price forecast for a fifth straight month to &&6;73.39.

The yen edged up in quiet trade, lifted by Japanese exporters and short-term investors.

The U.S. dollar slipped 0.2 percent to 93.98 yen. Sterling fell 0.4 percent to 153.33 yen, and the euro was down 0.2 percent to 134.38 yen.

The Australian dollar inched up 0.1 percent to US&&6;0.8357 and this week has been less reactive to domestic Chinese stock market moves. Earlier in August, sudden drops in the Shanghai market sucked the Australian currency down with it.

(Additional reporting by Elaine Lies in Tokyo)

(Editing by Kim Coghill)

Asia stocks edge up; eyes on oil and China

Hot News: Political Risks for German Chancellor as G.M. Wavers on Deal for Opel

Nearly a year after its deal to purchase Merrill Lynch, Bank of America is still on the defensive.

The bank, along with the Securities and Exchange Commission, on Monday defended a settlement over the bank&S217;s failure to disclose details about Merrill&S217;s bonuses ahead of a shareholder vote on the merger.

In its court filing, Bank of America said it acted properly when it did not disclose details of the bonuses and said it believed its view would prevail in court if the matter were put to test.

And the S.E.C. said in its filing that the settlement was the result of an &S220;arms-length negotiation.&S221;

The court filings were in response a ruling by Federal District Court Jed S. Rakoff of Manhattan who demanded two weeks ago that the bank and the S.E.C. provide a better explanation of its settlement over the bank&S217;s failure to disclose the bonuses.

Judge Rakoff said the bank&S217;s $33 million settlement with the commission seemed &S220;strangely askew,&S221; and he questioned the S.E.C.&S217;s decision to charge the bank at the corporate level rather than individual executives.

The judge requested that Bank of America supply the names of people who decided last year not to disclose the bonuses. He said he wanted to know the &S220;who, what, where&S221; behind the creation of the bank&S217;s proxy statement, the document provided to shareholders before they voted on the merger.

&S220;I cannot ignore issues of responsibility,&S221; Judge Rakoff said at the hearing on Aug. 10. &S220;Was there some sort of ghost that performed those actions?&S221;

The bank did not detail which of its directors or executives were involved in the proxy disclosure decisions. It did, however, name the law firm that represented it during the merger proxy, Wachtell, Lipton, Rosen &&8; Katz. And the bank said that Merrill Lynch&S217;s firm was Shearman &&8; Sterling.

The bank also listed the names of the directors on Merrill&S217;s compensation committee and pointed out that the S.E.C. did not claim &S220;intentional, knowing or even reckless conduct on the part of Bank of America.&S221;

Merrill&S217;s $3.6 billion in bonuses have been scrutinized in Congressional hearings this summer as well as in documents released by the New York attorney general. And Judge Rakoff said in his hearing that the bonuses seem to have been essentially paid using taxpayer money, since Bank of America had received $45 billion in bailout funds.

But the S.E.C. said that the &S220;extensive publicity&S221; around Merrill&S217;s bonuses did not elevate the standard of review for the case.

And the bank said it was important to focus on the issue of disclosure of the bonuses, rather than their size.

&S220;This case is not about the decision by Merrill Lynch&S217;s board to award the incentive compensation that it did,&S221; the bank&S217;s lawyer, Lewis J. Liman, wrote. &S220;Bank of America recognizes that decision has been the subject of controversy.&S221;

The case, the S.E.C. wrote, is about disclosure and not potential misuse of government funds, adding that bank executives were not responsible for the disclosures.

&S220;The negotiation and preparation of all of the relevant legal documents was handled by the law firms that had advised Bank of America and Merrill in connection with the merger,&S221; the S.E.C. wrote.

&S220;Although the extent to which taxpayer money was used indirectly to pay these bonuses plainly is a matter of public importance, it does not, in and of itself, give rise to a federal securities law violation,&S221; the S.E.C. wrote.

Bank of America spent most of its memo on the defenses it would make in court. The bank said there was no false or misleading information in the proxy. And the bank accused the S.E.C. of seizing on &S220;a single sentence fragment&S221; for the accusations.

Furthermore, the bank pointed to Merrill&S217;s financial statements, which showed last fall that money was still set aside for compensation at similar levels to the previous year, even after the merger was announced. The bank also said shareholders would have known of the bonuses because several media outlets wrote about them in general terms in advance of their payment.

Two legal experts wrote affidavits to accompany the bank&S217;s filing, and both said the bank acted appropriately in its disclosure. One, Morton A. Pierce, the chairman of Dewey &&8; LeBoeuf&S217;s mergers and acquisitions group, was paid for his memo. The other, Joseph A. Grundfest of Stanford Law School, wrote his memo on a pro bono basis because he was concerned the S.E.C. would have a hard time settling future issues if Judge Rakoff did not approve its deal with Bank of America.

The S.E.C. is expected to file its memo to the judge by the end of the day. Then both parties will have two weeks to respond to each other&S217;s filings. If Judge Rakoff does not approve the $33 million settlement, then the S.E.C. will probably drop the case, renegotiate the settlement amount or take it to court.

Bank of America Defends Its S.E.C. Settlement

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