The
March Group LLC
American Funds, the largest manager of stock mutual
funds, sold most of its holdings in PetroChina Co. after pressure from rights
groups over the oil-and-gas company’s investments in Sudan.

Three of the
firm’s funds sold 167.9 million Hong Kong- listed shares in the past five months
in Beijing-based PetroChina, currently valued at about $189 million, according
to regulatory filings by Capital Group Cos., which owns the American Funds and
manages $1.18 trillion.

Investors Against Genocide, a Boston-based human
rights group, cast the selloff as the group’s second victory in as many months,
after the announcement in January by nonprofit money manager TIAA-CREF that it
had dumped shares of four Chinese companies, including PetroChina, doing
business in Sudan. The organization has pressured asset managers to shun
companies active in the east African country, whose Darfur region has been
riddled with violence since 2003.

“We knew we were getting through to
them with our message,” Eric Cohen, the group’s chairman, said today in an
interview.

Chuck Freadhoff, a spokesman for Los Angeles-based Capital
Group, said the fund company “never made top-down decisions that told investment
professionals they had to buy or sell a specific holding.” American Funds has a
policy that asks fund managers and analysts to take human-rights issues into
consideration when making investment decisions, he said.

As many as
300,000 people have died in the Darfur strife, according to estimates from the
United Nations. The U.S. government has accused Sudan’s government of committing
genocide in the region.

Three Tesla Motors Inc. employees died in a
plane crash today in a residential block of East Palo Alto, California, Chief
Executive Officer Elon Musk said.

The twin-engine Cessna 310, which
crashed shortly after takeoff from Palo Alto Airport, was registered to Air
Unique Inc. The address for that company is also the home address for Doug
Bourn, an engineer at the electric carmaker, according to online listing service
Switchboard.com.

“We are withholding their identities as we work with
the relevant authorities to notify the families,” Musk said in an e- mail.

No injuries were reported on the ground, John Chalmers, a captain at the
East Palo Alto Police Department, said in an interview. Power was knocked out
citywide in Palo Alto, affecting about 28,000 customers, said Linda Clerkson, a
spokeswoman for the city. Hewlett-Packard Co. and Facebook Inc. were among
companies affected by the outage.

“The plane, when taking off, struck a
power tower, causing power outages throughout the area,” Chalmers said. “One of
the wings came off, and hit a residential structure.”

Stanford Hospital
and Lucille Packard Children’s Hospital, located in Palo Alto, were operating on
emergency power, according to Stanford University’s Web site.

Power
should be restored by 4:30 p.m. local time, said Joe Molica, a spokesman for
utility PG&E Corp.

The crash set two homes and several cars on fire,
said Harold Schapelhouman, fire chief of nearby Menlo Park.

The plane
had been en route to Hawthorne Municipal Airport in Southern California, said
Ian Gregor, a spokesman for the U.S. Federal Aviation Administration. The crash
site is about a mile northwest of the airport and about 30 miles (48 kilometers)
south of San Francisco.

The March Group

Alec Phillips, Goldman Sachs

Fannie Mae and Freddie Mac announced last week that they would purchase
delinquent loans out of agency mortgage-backed securities, which is likely to
result in $340 billion in unexpected prepayments over the coming year. This
policy could result in a change in federal foreclosure mitigation strategies.
First, it could marginally increase the motivation to foreclose on these loans
(some of them are already in foreclosure) in order to avoid a Treasury-imposed
cap on GSE mortgage portfolios. Second, and particularly if the first point
bears out, it could increase pressure on the GSEs to develop new strategies to
creatively deal with property they have acquired as loan collateral. Third, it
could also increase interest in developing new modification programs, though it
seems unlikely that the GSEs will be able to go so far as broadly applied
principal reductions.

While the buyouts will provide investors with cash
to reinvest in the MBS market, they are hardly an offset to the end of Fed
purchases. Most important, they will be funded largely through agency debt
issuance rather than the creation of bank reserves. In addition, while they will
put new money in the hands of investors who may purchase newly issued MBS, they
will reduce the capacity of the GSEs to make purchases in their own portfolios
to reduce volatility, particularly around the end of the Fed's purchases.

The [Fed Open Market Committee] minutes showed quite the debate over an
exit strategy at the Jan. 26-27 policy meeting. Policymakers were unanimous in
the view that the Fed's balance sheet should be reduced "substantially over
time," although [views on] how that should be done varied. Most [board members]
believed a gradual asset sale program would be helpful in shrinking the balance
sheet and [shifting] the composition toward Treasuries, although many thought
that could be disruptive. Several believed it was important to begin an
asset-sale program in the near term so that the balance sheet [would shrink]
more quickly and more predictably than via what could be accomplished solely by
redeeming maturing securities. A few suggested the pace of sales, and
potentially purchases, could be adjusted over time in response to developments
in the economy.

As we already knew, the committee made no decisions over
asset sales at the January meeting. We'll look for a further update on these
matters from [Fed Chairman Ben] Bernanke next week when [he] presents his
Humphrey-Hawkins testimony to Congress [on Feb. 24].

The March Group Extended Billing Period

Card
companies must provide cardholders with 21 days notice of due payment. That’s a
whole week more than the current 14 day requirement.

Protection of Young
Consumers

Students are among the most likely to fall prey to card
companies. According to a 2008 PIRG survey, 66% of students age 18-21 have at
least one credit card, and those responsible for their own card on average
graduate with $2,623 debt.

Previously, card companies set up on-campus
stands to seduce students with free food—donning the goods to students only if
they filled out an application form. The new rules ban card companies from
requiring students fill out the form to receive freebies.

The law also
stipulates Universities make all relationship with banks transparent (by posting
affiliation on the University Web site). Students’ ability to pay up is also
important. In the past, card companies granted cards to almost all students.
Under new rules, consumers under age 21 must provide a co-signer or evidence of
independent income.

Stocks ended higher Friday, marking the fourth
straight day of gains, but investors were cautious buyers at the end of a big
week that included the Fed's decision to boost the emergency bank lending rate.

The Dow Jones industrial average (INDU) added 9 points, or 0.1%. The
30-share blue chip index gained 303 points for the week, its biggest one-week
point gain since November.

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