August 2011
1 August 2011
1. Banks in BRICS showing increasing debt crisis with bad loans showing increasing credit risk NB
2. OBAMA says deal with Debt Limit approved
3. $2.1 t debt increase. $917 billion spending cuts
4. US still faces possible debt downgrade A2 to Baa1
5. CYPRUS ; Loans to Greece 160% of GDP. Assets to GDP 600%
6. CYPRUS attempts to rein deficit crisis
7. CYPRUS exposed to Greek banks-contagion fears
8. CYPRUS –controversial ammunitions dump explodes taking out power station or 50% of Cyprus electricity. With growth only forecast at 1, 5%, now estimated at . S& P have downgraded Cyprus and another bailout headache for Germany`s, Merkel.
9. Gold Spot $1613
10. UK`s CBI cuts growth forecast. Q2 growth down from 1,7% to 1.3%, GDP stagnant, manufacturing declines
11. Roubini: Guns and Butter and Low Taxes: On Deficits, Debts, Debt Ceilings and the U.S. Fiscal Mess
12. By Nouriel Roubini: The current U.S. fiscal path ensures that the already anaemic economy will double dip by next year or at the latest 2013, and also ensures that eventually bond vigilantes will drive up long-term interest rates if no credible plan for medium-to-long-term fiscal consolidation is approved. The optimal path of fiscal consolidation is back-loaded rather than front-loaded, given that the economy is still very weak and growing anemically below trend. Still, a credible commitment to such a path needs to be made immediately.
13. Foreign Sovereigns Unlikely to Flee Treasurys
14. By Rachel Ziemba: Concerns that major foreign holders will stop buying U.S. Treasuries, or sell off those they have, as a result of the U.S. debt ceiling negotiations are overdone. Domestic exchange-rate policies constrain diversification from USD assets in places like China, while other large reserve holders are restricted by portfolio size—there are few substitutes for Treasuries. In addition, as central banks and sovereigns have already been diversifying away from Treasuries, a knee-jerk reaction is less likely, while in the event of greater diversification, self-balancing effects could be seen as yields rise.
15. U.S. Growth: Q2 Growth at 1.3%; Q1 Revised Sharply Lower to 0.4%
16. U.S. Q2 growth, at 1.3%, was slightly under our forecast of 1.5% and well below consensus expectations of 1.8% growth. Meanwhile, the Bureau of Economic Analysis revised the annual benchmark GDP for Q1 2011 down steeply, leaving the final figure at 0.4% q/q. The sharp downward revisions to prior data clearly reflect an underlying weakness that cannot be attributed only to temporary factors. Moreover, data in late Q2 and early Q3 show few signs of a rebound.
17. Switzerland Outlook Update: Continued Franc Strength to Dent Economic Growth
18. By Sehaj Malik, James Mason and Katharina Jungen: Despite a sharp appreciation of the CHF, the Swiss economy continued to power ahead in H1 2011, but export performance will likely weaken over the forecast horizon as lagged effects of currency developments crimp business profit margins. There is a high probability that the Swiss central bank (SNB) will push a rate hike to next year, as the SNB finds itself at the mercy of the Euro zone debt crisis and, as a safe haven, is likely to see persistent currency strength or even further appreciation.
19. Europe Weekly: Spanish Politics; EFSF Ratification; German Soft Landing; Czech Monetary Policy; Turkish Depreciation
20. By the RGE Europe Analyst Team: Spain’s prime minister called an early general election for November 20; Spain’s main centre-right party currently leads the polls. EU leaders want to fast-track ratification of the European Financial Stability Facility legislation by the end of the year, expanding the fund’s capacity and introducing new tools. Weakening business sentiment points to a soft start to Q3 for Germany, with the composite PMI registering a sharp decline in July. The timing of the Czech central bank’s first interest rate hike has become increasingly uncertain; RGE looks to November for a rate increase. Lastly, the Turkish central bank announced suspension of its daily FX auction purchases and lowered the required reserve ratios on longer-term FX deposits and liabilities held by banks to stem depreciation
21. Macguineas Interview: President of the Committee for Responsible Government. A Deficit Warrior. The extension of the debt limit of $2.1 trillion is immediate relief from the ‘gut retching rollercoaster’ while Congress has been deliberating debt default resolution. Yet the amount or resolution is not sufficient to comprehensively deal with the subject, and that will mean Congress will have to come back to the table. NB
22. HSBC to cut 30 000 jobs by 2013. Sells upstate New York branches
23. PIMCO sees corporate as a haven after reviewing 11 regions
24. Spanish & Italian debt ratings send stock markets into spiral.
25. Robert S Kaplan, Harvard University: “HOW do we BOTH grow and deleverage at the same time”. “New Book-What to ask the person in the mirror”. Take control of your lives and make the right decisions
26. Robert S. Kaplan ([rokaplan@hbs.edu](<mailto:rokaplan@hbs.edu>)), formerly vice chairman of the Goldman Sachs Group, is the Thomas S. Murphy Senior Lecturer of Business Administration at Harvard Business School in Boston.
27. P Fisher: “Politicians went too far with the threat of default.” ( Harvard & Head of Global Fixed Income at Blackrock)
28. O Neill. Most benchmark investors are stuck in history. Russia, & BRIC countries favoured.
29. German Bills SOAR as investors run for the hills- Chart of the day
30. Gold large holdings : John Paulson & George Soros ( follow coverage of buys & sales)
31. IMF –Romania agree on a 2nd tranche of $619 million
32. Wall Street can save Washington with a reverse TARP- William D Cogan
33. Stoxx 600- worst earnings for industrial stocks sees a drop of 8.9%
34. US A 400 year default also leaves scars
35. US would raise debt limit only through till 2013 –Democrat- Minority Leader Congress
36. Vote on US Debt Limit to be held today, with detractors on the right& left
37. US; Deal is just a BAND AID to get past-Wilson advisor to president Obama
38. Rep. David Schweikert-debt ceiling compromise will not solve the problem. Was never the case we can default. Why do we have such pathethetic GDP growth ? There is a crush of uncertainity, and I will vote with common sense.
39. SA seeks bids for renewable energy projects
40. EU-Worst European earnings hitting industrial Stoxx 600 by 8.9 %
41. Stocks in US drop, as US Treasuries rally
42. US stock market volatility is no tsunami for debt
43. Putin says US is ‘leeching’ on global economy, living beyond its means. NB
44. US-Embarrassed CEOS silent on US Republican compromise
45. US debt debate: Manley: One of the biggest beneficiaries of Debt debate is Obama 2012 election
46. Spanish & Italian ratings drive markets into a negative spiral-Euro credit
47. Debt deal is the first step to integrity. Peter Fisher: Tom Keene
48. Romania may have to raise interest rates a year later-IMF says
49. US Security Council will meet today to discuss Syria violence
50. Worst European earnings hitting Industrial stocks
51. Coffee open interest , suggest prices will drop.
52. Suisse Franc hit a new all time record
53. GOLD $1629.50 ( 5pm SA time)
54. US 2 year Treasury. 2.79%
55. Stuart Thomson- Ignis Securities. A Great market for US Treasuries
See -> a whole bunch of articles in child thoughts - related to the oil weapon in GReen File Summary
_ 2 August 2011 (Tuesday)_
1. 1. US-weaker manufacturing data revived concerns of global economic recovery
2. European stocks 10% off 2011 high
3. European bank shares tumble
4. Bryne Jones interview: Rathbone Unit Trust management- The shift from West to east. There is some $1.75 trillion of US treasuries in money market. IF U.S. is downgraded, money managers may be forced to sell treasuries. Expects a downgrade and see resolution with kicking the can down the road. The U. S would have to grow GDP 5,9 % with inflation of 3% to meet deficit reduction of $2.1 trillion over a 10 year period . Current 10 year bills 2.73%. at present the U.S GDP growth is .50% which is far short of the 1990`s decade where growth averaged 3%. U.S. Treasury interest rates are likely to increase, with further growth and unemployment concerns.
5. Michael Lewis (Deutsche Bank). Gold will rise until Fed tightens credit. Investors are insisting on physical ownership, which changes the dynamic of previous investors. ISM no`s in the US are weak and the outlook is not positive, and Gold will continue to rise. Silver as an alternative investment is losing steam to Gold which has another 20-30% to go. Investors are very long on the gold market, because of the distrust in US $ and sovereign funds ability to avoid default.
6. UK 10 year Government Bond declines to 2.78%
7. US ISM sinks to a 2 year low. Averaged annual growth declines to 1.30%
8. Bob Parker Cr Suisse asset management. U.S. A 2 year period of mediocre growth with a double dip recession
9. Stocks in Europe fall to a 10 month low, Franc hits a record, Treasuries climb.
10. Barclays to cut 3000 jobs this year as Investment Bank revenue declines
11. Saudi Arabia snaps up Treasuries as China purchases slow
12. SA vehicle sales slows to 10,5% on unemployment increases
13. Hungary forint falls to a record low against France as US economy slows
14. China stocks more immune to EURO & US debt woes
15. MERAFE profit slumps 54% on SA Rand strength
16. OBAMA debt deals shakes trust of supporters heading into elections 2012
17. Congressman debt deal is an alarming bi-partisan agreement
18. IMF ‘harsh’ legacy may block Middle East loans after Egypt $3 billion U-TURN
19. FED policy makers may consider additional stimulus as US economy falters
20. Treasury ‘REAL’ yields lowest since 2008
21. Zimbabwe loses $12 billion in potential output in 10 years says farmers.
22. Spanish/ Italian Bonds slump in demand as demand on German BUNDS soar.
23. Uganda central bank raises bench mark interest rate to 14% to curb prices
24. House passes Debt Deal 269-161
25. GOLD $1633.88 in London sets a new record ( Futures $1637) 2pm Tuesday
26. Sell happiness, BUY gloom in emerging markets-Chart of the day
27. Italy/ Spain stuck in a no-go debt zone for Merrill DWS funds-Euro credit
28. Oil declines for a third day as stockpiles climb and economic outlook
29. Men in black follow the money as India GRAFT team investigates
30. Stuart Eizenstat Covington & Burlington partners and former Sec of Treasury under Clinton. Obama needed $4T not $2,1 T. It’s a dissimulative bipartisan agreement. Its puts more pressure on the Fed to act. They did not get the extension of the payroll act. State & local Government’s are hurting, and this budget will give less to states. US Debt crisis averted, but there is not a lot that can be done. Fed may want to wait another quarter before taking action. We need to increase the payroll tax from both employers & employees. The bigger picture, we are entering into a period of austerity, will effect military spending. There is over a $1 trillion less in military spending which will not only reduce jobs , but reduce U.S global footprint.
31. DANA GAS still waiting for $148 million payment from Egypt Natural Gas.
32. Kosovo should focus on trade & economic growth –IMF says
33. War, guilt & thank you for your service. Comment Elizabeth Samet.
34. Buenos Aires bonds trail government glut
35. Pal Krugman – Princeton university- Debt deal is nothing NEW
36. US Personal spending rose to 0.1 % and personal spending fell 0.2%. Dismal results with an average of 1.3% for the year
37. Consumer spending in the US unexpectedly falls for the first time in 2 years
38. Russia stocks decline from a week high as oil prices decline on US economic data and increase of stockpiles
39. Japan-TEPCO reports 2nd radiation leak
40. Quiet period end means biggest crapshoot for US IPO`s
41. SA equities head for a 5 week low led by BHP & Anglo
42. European stocks decline 10% from peak. Euro may rise against the $ by year end.
43. European stocks fall to the lowest in 10 months
44. Czech ‘safe haven ‘ bonds in demand
45. Geitner says he hasn`t decided to quit as Obama Treasury Chief
46. Swiss stocks hit a 2 year low as ‘exporters struggled’ with the SFR at record highs. ( YING & YANG)
47. ROUBINI: Emergency Italian Government Meeting as Bond Yields Soar
48. On August 2, yields on Italian 10y bonds reached 6.26%—a euro-area high and a level deemed unsustainable by most investors. On July 25, authorities had cancelled the August 2 bond auction, citing large availability and low requirement of cash. Market confidence has deteriorated significantly due to increased Italian political instability, the economy's poor growth outlook and the inability of EU policy makers to agree on the extent of private-sector participation in Greece's next rescue package.
49. 3 August 2011
1. Italy 6.13% 2 year and Spain 6.28 % 2 year. Rates present a crisis for a bailout with record highs
2. Gold $1660
3. Global Stock market Selloff- S&P; has lost $2.1 trillion in 6 days
4. Interview: Edmund Phelps- Nobel laureate – “We Are between two horns and we are going to get gored .It`s a dilemma with no solution and we are between 2 horns. We have to get control of deficits in US & Europe.” NB
5. DAVID BLOOM HSBC. Norway Kroner is the beauty!!!!
6. PIMCO & BLACKROCK says US market has stalled
7. Hackers in China attack Olympics and UN- Security specialists
8. SA-Rand hits a 2 week low against the $, and slips below Euro on weakened growth.
9. SA-Mine Nationalization of mines will dter investment in SA- Chamber says
10. Lloyds; 64% of Irelands are empaired. Shares have dropped by 38% and UK Gov has a 41% stake that it will struggle to sell.
11. Turkish lira tumbles with surprise shock rate increase and stocks slide
12. Japan intervenes into the currency market.BOJ releases Yen 50 trillion QE, and Japan buys US Treasuries to weaken the YEN below 80-$. Japan largest exporter is China, and since Rimini is tied to the $, the contagion mitigation is a strategy of the GF. Bearish about commodities. Toxic tango in Europe, we got out of all EU corporat holdings and sovereign debt. Richard Cookson CITI
13. Spanish Bonds yield surges with Euro 3.31 billion euro bond sale. 6.28% 10 year
14. Italian 10 yr 6.19%. (Critical level for EU bailout 7%)
15. Credit default swaps on US European companies debt soar on EURO contagion fears
16. Stocks tumble as US treasuries hit a record low.
17. $ 262 billion wiped off the FTSE 100 past week/
18. $760 billion wiped of EU stock exchanges past week5 August 2011
1. S& P 500 down 7.1% this week
2. $4.4 trillion wiped off global markets
3. Asian bonds rise on recession fears
4. Commodities post worst losing streak since 2008
5. Hang Seng volatility index raises 50% -highest ever
6. Japan stocks drop most since March Tsunami
7. Indonesia economy grows 6.9 % and Central bank leaves rates unchanged
8. Italia 6.37% .Spain 6.39%, Ireland 10.39% German 2.24% 10 year bonds. Italian yield the highest since 1997 ( euro era record)
9. Watch Bond spreads today NB. At what price will investors climb into Italy/ Spain Bonds for the long term
10. FABER sees S&P; 500 rally. Says markets oversold. Strategist see a 17% rally by year end.
11. Mark Mobius Templeton asset Management-confident with emerging market equities as they are not as exposed.
12. Oil trading at $83 , down from $100 in a week, wiping out all profits for the year
13. Gold $1657. (All time High $1700)
14. Turkey central bank may sell $ after interest rate hike weakens Lira.
15. Hungary Swiss noose tightens as currency surge swells Franc loans
16. Hungarian industrial output plunges to the worst level since 2009
17. Trichet Bond ‘firepower’ tested as ECB unable to stem crisis
18. German DAX falls 4.1% the longest losing streak since 1993
19. ICBC pays Standard Bank $600 million for Argentinean assets
20. SA Benchmark drops 2.7% on opening trade
21. China no saviour this time as stock continue downward spiral
22. CEBR: Italy bound to default- Douglas McWilliams CEBR CEO
23. Berlusconi unfazed by crisis
24. Emerging markets stocks tumble and currencies weaken
25. SA Gross foreign reserves increased $50.1 billion last month
26. SA faces downside risk with EU crisis.
27. SA stocks face the biggest weekly drop in 2,5 years
28. Rand heads for the worst week
29. ECB Bond buying fails to halt
30. European stocks post the biggest loss since November 2008, led by banks
31. S&P; downgrades US credit rating from AAA to AA+
32. RBS will cut 2000 jobs on Greek write down
33. Ex- UBS banker faces charges for hiding clients funds in Swiss accounts
34. AUSTRALIAN shares slumped by four per cent to its biggest one-day loss since the height of the global financial crisis almost three years ago. Fresh concerns that United States could be headed back into recession and fears that Europe’s debt woes could be spreading to Italy and Spain sent investors to exits. The fall wiped almost $60 billion from the value of Australian stocks on Friday and took the cumulative loss to around $100 billion over the past week.
35. Italy seeks to balance budget by 2013 and gets a respite from Bond markets as Berlusconi takes austerity measurers
36. Carlos Slim lost $6.7 billion this week as S&P; 500 index lost 7.5% this week
37. S& P analysis is $2.2 trillion short US Treasury says
38. Berkshire profits rise with Goldman Sacks investment derivatives
39. Asian stocks have the biggest fall in 3 years
40. JAPAN-KAN vows to push for a Japanese nuclear free society at the Hiroshima ceremony.
41. Accenture MD – ECO HOMES JAPAN
42. Rare earth minerals found of the coast of Hawaii
43. S&P; says that the $2 trillion mistakes is inconsequential considering the $150 trillion total-John Chambers S& P sovereign ratings chief
44. Burnett- 75% of global debt is linked to US Debt. This downgrade is a wakeup call, but not a serious issue
5 August 2011
Observations From Nouriel Roubini
* “A critical issue is the optimal intertemporal distribution of the necessary fiscal austerity. Front-loading the fiscal austerity does not make any sense as the resulting fiscal drag would bring the U.S. economy to a stall speed—if not an outright double-dip recession. The optimal path of fiscal consolidation is back-loaded rather than front-loaded, as the economy is still very weak and growing anaemically below trend. Heading down such a path must begin with a credible commitment today via the passage of legislation to gradually phase in entitlement spending reforms and tax increases as the economy returns to potential growth. Making such a credible commitment would imply that there is light at the end of this fiscal tunnel, that deficits will stabilize over the medium to long term and the public-debt-to-GDP ratio eventually will fall.”
* Read more: “Guns and Butter and Low Taxes: On Deficits, Debts, Debt Ceilings and the U.S. Fiscal Mess”
* RGE Views Update
* United States Outlook Update: The recovery from the recession looks weaker than previously estimated, with the sharp downward revision to Q1 data showing an economy at a virtual standstill. We now envisage H2 growth being lower than we previously expected, at 2.25%, and the yearly growth rate will be a weak 1.7%. With the economy looking increasingly at risk of tipping into recession, QE3 seems unavoidable; we now expect the Fed to stay on hold until H1 2013.
* Switzerland Outlook Update: RGE expects GDP growth to reach 2.5% this year before cooling down to 2.0% in 2012, as currency strength eventually takes a considerable toll on export volumes.
* Australia Outlook Update: In spite of a strong inflation reading, sluggish demand growth and uncertainty over sovereign debt in the U.S. and euro zone move us to drop our call for a 25-bp rate hike in August by the Reserve Bank of Australia, forecasting the RBA to instead hike in November. This would be the first and final rate hike of the year, as opposed to our previous call for two hikes.
* ECB Rate Call Update: We reiterate our expectations for no further rate hikes until the end of 2012 and increased bond purchases and liquidity interventions in view of the deterioration of the growth outlook, the subsiding of input pricing pressures and the lack of ability of euro zone policy makers to contain uncertainty around the sovereign debt crisis and its contagion to Spain and Italy.
* Turkish Monetary Policy: Expect the Unexpected By David Rogovic and Tim Azarchs: The Central Bank of Turkey (CBT) continued its heterodox monetary policy mix and surprised markets once again yesterday, cutting the one-week repo rate to support domestic economic activity while taking efforts to shore up the Turkish lira (TRY). The moves reflect the CBT’s growing concern over global growth and the potential spill over effects of a global slowdown on domestic demand, as well as shifting risk sentiment and the effect on TRY. While the overall policy mix may have some merit, the CBT’s poor communication and lack of policy credibility could cause the decision to backfire, especially given Turkey’s large external financing needs
* Japan Intervenes to Stem Yen Gains; BoJ Expands Monetary Easing Japan's Ministry of Finance yesterday unilaterally intervened in the FX markets for the third time in less than a year to stem the yen's appreciation, while the Bank of Japan (BoJ) announced an expansion of its monetary stimulus. In our Japan Outlook and subsequent updates, we anticipated further monetary easing through an expansion of the Asset Purchase Program and currency intervention this year. In light of the persistent drivers of yen appreciation (loose monetary policy from the Fed and ECB amid recession-like conditions in the U.S. and EU), we remain of the view that there will be no rate hike until 2013 at the earliest as the BoJ does what it can to aid the post-quake recovery.
* Oil Prices Plummet on Debt and Global Growth Concerns
* WTI broke US$89/barrel yesterday for the first time since mid-February as markets were gripped by fear over euro zone debt and global growth. Even in the peak summer demand season, the crude oil markets remain volatile. Looking ahead, we expect GCC OPEC members to gradually increase production in response to global demand; combined with weak global growth, this will keep prices suppressed
* Bank of England August 2011 MPC Meeting: Bank Rate Maintained at 0.5%
* As expected, the Bank of England (BoE) maintained its policy rate at 0.5% and the Asset Purchase Facility at £200 billion at the August 2011 Monetary Policy Committee meeting, marking the 29th month at this interest rate. We see no need to hike until H2 2012, with the BoE keen to support economic growth—in particular, private consumption—as the economy goes through painful fiscal austerity and rebalancing.
6 August 2011
1. S& P downgrade of US AAA credit rating to AA+, is released by S&P; after at 5pm at the close of trading hours. UST Treasury Sec Geitner meet with President Obama, and USG response condemns downgrade and says S&P; unaccounted for $2 trillion in cuts.
2. China criticize US wrangling over the debt issue
3. CHINA CALLS FOR AN ALTERNATIVE RESERVE CURRENCY.
4. China has $1.7 trillion in US Securities
8 August 2011 (Monday)
1. GOLD $1711.55
2. Middle East shares tumble.
3. Saudi markets down 5% today
4. Dubai down 3.7% down
5. Oil slumps 3% to $83. Volatility of oil prices this year notable
6. Emerging markets MCI down 12.75%
7. G7 vows to take ‘all necessary steps’ to stabilize markets
8. Japan stocks slide with US S&P; downgrade.
9. Japan official warns of more YEN intervention selling to stem currency speculation (i.e UST purchases to devalue the YEN)
10. $ 5,4 trillion wiped off global markets
11. FTSE 2.73%, DAX 2.68%, CAC 40, 2.78% all down and the largest losing streak since the 1970`s
12. Australia stocks slump 20% since 2010 high
13. GOLD $1711.600- New Gold futures set a record
14. Swiss France/ Euro .9235
15. ECB ready to buy Spain & Italy debt NB
16. Crisis of confidence- bond purchases may fuel inflation
17. UST Geitner agreement to stay on gives Obama continuity with market turmoil
18. Muni bonds await a downgrade. Note Maryland & Virginia
19. Italian bonds jump
20. Global Banks poised to slash 101 000 jobs in fastest reductions since 2008
21. ECB buying Spanish & Italian Bonds to stem crisis for as much as $1.2 trillion in creeping EU fiscal union ( High risk strategy to calm markets)
22. S& P set themselves up for trouble by demanding a $4 trillion cut- Reynolds
23. S&P; crossed the line by addressing too much politics-Reynolds
24. Financial sector has very strong head winds to deal with- Reynolds
25. SA stocks head for the lowest close since Sept 17 after record drop
26. Ruble loses value most amongst BRICS as oil revenue declines 2011 gains
27. Syria mounting deaths spur conflict and condemnation as Saudi Arabia/ Bahrain pull Ambassadors
28. Commodity linked sovereign bonds jump
29. Dubai shares jump to the lowest since March
30. Nigeria plans to inject $4.5 billion into 3 banks to restore stability
31. South Africa not making significant’ changes to foreign currency reserves
32. SA growth still on budget irrespective of US downgrade
33. Russia bemoans low credit rating as it seeks to increase loans
34. Saudi Arabia spare oil fall to the lowest in 3 years with increasing demand at home
35. Romania cut 2011 inflation to 4.6 %
36. Debt deal disaster shows the genius of democracy- N. Feldman
37. Breaking News- stock futures tumbling
38. Bank of America a buy at $7.50.Citibank -apparently they got more than they bargained for (Merrill Lynch acquisition)!!!
39. BOFA aggressive in putting mortgage issue behind them. AIG is suing for $10 billion in mortgage losses
40. Corporate Bonds in demand e.g. Johnson & Johnson AAA
41. S& P. Best case scenario sees US debt at 85% of GDP by 2012
42. Russia stocks tumble to a 8 month low on lowering oil price
43. Standard & Charter buys a $75 million stake in Bin-laden Group. (Construction of the world`s largest tower)
44. Russia may ship as much as 65 million tons via Arctic by 2020
45. Bond sales skid to the slowest in 2011
46. Corporate ratings least effected by US downgrading
47. MUNI markets prepare for downgrades
48. US debt problems is severe for the country over the longer term= Fleckenstein Seattle
49. Kraft faces $11 billion in cuts to retain bond credit rating
50. Jack Bogle Interview CNBC 90% of ETF`s are for speculators and will have to learn from their mistakes. Jack Bogle Chairman & Co founder of Vanguard Group.
51. S&P; to report on MUNI downgrades later today after US downgrade
52. Strange that MOODYS is so silent.
53. S& P cuts Fannie Mac & Freddie Mac to AA+
54. U.S. Hospital debt risk climbs to a 12 month high on limited budget deficit plan
55. EURO bank crisis may stuff U.S. banks with un-deployable ‘hot potato’ cash.
56. STOXX Europe 600 drops 20% from February high to enter BEAR market
57. JP Morgan supports S& P even if some $2 trillion cuts were missed by S & P for CBO (Congressional budget office) deficit reduction plan. Growth forecasts of 3,5 % might to be sustainable, Defence budgets may not be cut if wars continue or escalate and the long term sustainability 2020 still hangs in the political balance.
58. SA Bond yields rise on market concerns : Rand declines
59. Barclays says, ‘ stick with US stocks after S&P; downgrade’
60. MOODY`s expects the US to take ‘further fiscal measures’.
61. Moody`s Investor Services Ratings affirms U.S. AAA credit rating
62. MOODY`S – US can support a higher debt load and the Debt limit increase of $2.4 trillion is more than half way there and expects the U.S to take further measures
63. OMAN sells T Bonds in pre-cup lull
64. VSTOXX Volatility index rises a ninth day, the longest streak on record. ( The measure of investor volatility )
65. Wall street losses some $2 trillion over the past 2 weeks. Selloff deepens after downgrade
66. Ex Harvard scholar takes over Dalai lama regime in exile
67. Spain 10 year bond. 5.18% , a huge reduction in interest rate since ECB has been buying
68. AIG files suit against Bank of America after mortgage losses
69. Czech shares head for the worst day in 14 months
70. Latin America can avert crisis if recession returns. Morgan Stanley
71. GOLD- Deutsche Bank says that in this environment gold can go to $2000
72. Gross (PIMCO) reduced treasury holdings to 10%. Gross lifts his ‘white cap’ to S&P; for having the spine to downgrade U.S.
73. Berkshire Hathaway placed on a negative watch from stable- S&P;
74. Gold closes $1712.33 a new record
75. Rand closes 7.12 to $ and weakens on risk aversion NB
9 August (Tuesday)
1. GOLD $1767.9
2. VIX index yesterday 50%
3. $2 trillion wiped off global markets yesterday
4. FTSE dropped 6.7% yesterday
5. FTSE falls 2.23% within 2 hours of opening
6. GLOBAL STOCKS ERASE $7.8 Trillion in value
7. Every single stock on the S&P; 500 fell yesterday ( Monday )
8. Credit default benchmark at a record
9. Asian stocks extend biggest slide since 2008 with US rout
10. Ex-IMF Chief sued by NY hotel maid for acts deplorable
11. China inflation 6.5% quickens and limits policy response to global crisis. Inflation higher than estimates and producer (food) prices rise 7,5% in July. Economists expect interest rate hike
12. Japan : TEPCO losses escalate with new claims
13. Cameron returns to UK to face riots in London
14. Global sell off escalates; European stocks enter a bear market. US not yet!
15. Standard Chartered buys $75 million stock in Saudi Bin laden unit
16. UK –riots rage as police battle for control
17. Rand $: Yesterday 7.19 , today 7.33
18. Euro SF: 1.07. Hits a new record. Singapore $ a better investment
19. SA Anglo down 33% and resource stocks down 25% in a few weeks
20. China= price of PORK up 50% year on year
21. SA stocks down 15% : US down 18% in 6 days
22. ECB intervention brought Spanish / Italian 10 year bonds down 1% yesterday (6.5% -5.4% avg.)
23. SA Hawks obliged to investigate SAP Bheki Cele ( Commissioner)
24. Federal Reserve faces policy dilemma. Urgent meeting tonight to move investor confidence. May strengthen investor confidence with QE3 stimulus.
25. Mark Olson ( former fed Governor)- Unless a $ trillion stimulus is applied, does not see any material effect, nor is it available
26. Fear index surges most in 5 years, but it will exhaust itself eventually. Either way, a climax downwards or an upward surge is expected
27. FIFA said to open corruption against Caribbean officials
28. Billionaire Ross buys assets as fear not fundamentals rules markets
29. Traders say no signs of liquidity withdrawals as stock markets sink to 2008 levels
30. $ 8 trillion wiped off stock markets in 6 days
31. Brent crude hits 2009 lows: Currently $100
32. Asian markets have fallen 20% from their peaks as meltdown continues. Either a blowout or climax will rebound
33. Malaysia SUKUK favoured over Indonesia
34. US shares record the biggest losses since 2008
35. Hong Kong shares slide 6.5% today, and down 20% from highs
36. Citibank sues BOFA $10 billion on mortgage fraud
37. Kenya receives $106 million loan for small banks
38. HANG SENG index falls 23% from 8 November high and enters a bear market
39. MCI all country world index fall 20% from 2 May high
40. BNP freeze on a Hedge fund withdrawals in 2007 still reverberates today.
41. Kenya`s shilling falls to 94.5 to $, the lowest since 1994
42. New Zealand well positioned to weather global storm
43. NZ- World cup organisers have hit 87% of target and expect 87000 visitors
44. OIL $79.58 & futures $78.30, down 15%
45. Hong Kong falls 23% from November high. Hang Seng enters bear market, Asian stocks tumble on 6th day.
46. Persian Gulf attracts investors seeking safer havens than Europe.
47. BNP freezing hedge funds 2007 , still reverberates in 2011- Credit markets
48. Gold tops $1770 ( Midday)
49. China inflation hits a 3 year high
50. Gary Shilling (former economists with Merrill lynch): Predicts 3% on a 30 year bond. Global recession will require the safe haven of UST. Gold & SF is the state of the global economy, and the reality of October 08 a bad dream is over. It will take time to sort and a recession is ahead and increasing over the next decade.
51. Deutsche CEO`s hedging of Italy risk shows that Germany is the priority.
52. Russia MCEX index retreats 20%
53. Estonia credit rating raised to AA-
54. Latvia economy grows most in 3,5 years
55. European stress levels are worse than when Lehman collapsed
56. The ECB’s extension of the Securities Markets Program (SMP) to include Italian and Spanish securities was indispensable to prevent Italy and Spain from eventually losing market access; however, ECB bond purchases, even if done on a large scale, provide but short-term relief. In view of controversial fiscal integration choices with respect to the long-term stabilization of the EMU framework, a series of sequential public debt rescheduling with bail-ins, potentially even in large countries, is the most likely outcome over the next couple of years. This may be followed by selective exits from the EMU, with the departures of Greece and Portugal most likely over the next five years. ROUBINI
57. Germany is riskier than UK credit default swaps show
58. European stocks float to a 2 year low.
59. BOFA lost 20% of share value yesterday
10 August 2011
1. SA- business confidence fall to a14 month low as recovery falters
2. SA-Worlds highest cost for ports drive trade awy
3. Phillip Swagel (University of Maryland). There is not more that the FDR can do now
4. UK. King says the BOE can inject stimulus if needed
5. Worst Ruble rout in six years show the reliance on oil.
6. Hungarian yields at a record high
7. No tax stand by republicans is not supported by either history or facts
8. Swiss Banks to pay $2.8 billion as German TAX DISPUTE is settled. ( Deutsche Alex Brown ???)
9. Norges Bank on Hold Due to Market Turbulence Norges Bank, Norway's central bank, kept the policy rate unchanged at 2.25% at its August 10 monetary policy meeting despite earlier having assigned a "100% probability" for a hike, citing ongoing market turmoil. So far we are not seeing signs of weaker activity in Norway, but expect lower oil prices and slower global growth to weaken growth in Norway in coming quarters. Furthermore, global rate expectations have come down, which limits Norges Bank’s ability to hike rates, as this would likely lead to currency appreciation and too low an inflation figure. Norges Bank will publish its next monetary policy report in October, and it seems likely it will lower the rate path forecast in that report. ROUBINI
10. France credit worthiness speculation
11. Putin dodges higher yield costs as Ruble devalues
12. Exxon Mobil trading halted with circuit breaker
13. Portugal attempts to seduce asset buyers at the worst of times
14. France breaks away from ECB core bailout
15. Investors in US ‘keep their heads’ as S&P; downgrades MUNI BONDS
16. FIFA enters proceedings against 16 Caribbean officials
17. US Treasury 30 year demand tumbles as inflation outlook saps demand
18. ECB overnight loans to banks jump to $5.8 billion , the most in 3 months
19. US Budget Committee begins with a $3.75 trillion tax gap
20. France breaks away from core Europe with costs of bailout
21. US Trade deficit for July unexpectedly jumps to $53.1 billion as export slumps
Conference Call Transcript: S&P;’s Downgrade of the U.S. Credit Rating
Nouriel Roubini: "The final and most important policy implication is going to be further fiscal retrenchment in the U.S. and other advanced economies that potentially will be recessionary as early front-loaded fiscal austerity—however necessary austerity may be in the medium term to avoid a fiscal train wreck—is contractionary on growth in the short run, as a recent IMF study suggests. So the G3 engaging in additional sharp front-loaded fiscal consolidation cannot augur greater growth for advanced economies; it rather increases the risk of a double-dip recession."
See -> Unprecedented Fed to the Rescue
15 August 2011 (Monday in exile)
1. Kuwait Emir wars of structural imbalances
2. Syrian vessels target Port city of Latakia as uprising claims 2400 lives
3. US Bonds converging with Japan heralds the biggest Bond sale since 2008
4. Credit Suisse may settle US probe by admitting wrongdoing
5. Google to buy Motorola Mobility for more than $12 billion (Patent Rights NB)
6. SA Bonds rise before weekly auction amid growing weakness concerns
7. ECB settles record $38.7 billion in bond purchases to calm crisis
8. Nestles biggest acquisition in China results in 23% profit at no risk
9. SEC to investigate S&P; Math , as information may have leaked to markets deliberately
10. BUFFET: “Stop coddling the super rich and raise taxes”
11. Stocks face further losses on Europe`s credit crunch
16August 2011
* France, Belgium, Italy and Spain to Ban Short Selling, What's the Impact?
1. We believe that the downward pressure on European financial institutions will not ease due to the announced short-selling ban. There has been a marked deterioration of investor confidence in the ability of banks in Europe to withstand the damages caused by the eurozone sovereign debt crisis. Further, the short-selling ban could have unintended consequences: Investors could use financial instruments that are not covered under the ban as proxies or could use proxy countries with similar economic and financial fundamentals- Roubini
France: No Growth in Q2 NB
2. The French economy surprised to the downside with no growth (q/q) in Q2 2011, below consensus expectations of 0.2% growth. Discussing the stall, Finance Minister Francois Baroin cited a fall in household consumption with the end of stimulus measures, and "a series of extraordinary events" in Q2—the aftermath of Japan's earthquake and Arab uprisings. Consumer spending fell by 0.7% q/q following 0.4% growth in Q1, while manufacturing activity contracted 0.6% following 2.9% growth in Q1. This is the largest contraction in French manufacturing activity since the summer of 1968.
Franco-German Meeting on August 16: No Eurobonds Without Binding Fiscal Rules NB
3. Another Franco-German meeting will take place today, though leaders have ruled out pledges for Eurobonds without binding fiscal rules that imply some loss of fiscal sovereignty. The ECB restarted its Securities Markets Programme on August 8 against a renewed Franco-German statement that they will approve secondary bond purchases by the European Financial Stability Facility (EFSF) upon the ECB's signoff. Meanwhile, France has become less of a safe haven than Germany, with concerns over the strength of its economy and debt-to-GDP ratio pressured by its role as a key supporter of the EFSF.
4. ECB Restarts Bond Purchase Program: Buys Record €22 Billion in One Week
Since restarting its bond purchase program (SMP) on August 8, the ECB has purchased a total of €96 billion in Spanish, Portuguese and Irish bonds; €22 billion in just the past week.Purchases are set to continue in the short term, at least until the European Financial Stability Facility (EFSF) is approved to engage in secondary market purchases. Taking current SMP purchases as a percentage of GDP for Ireland and Portugal as a benchmark, large-scale asset purchases could amount to around 10% of GDP in both Italy and Spain. In our view, large-scale intervention or QE—even on an unsterilized basis—is not only desirable from the perspective of financial stability, but also from the perspective of monetary policy, given the rapidly deteriorating growth outlook in the eurozone and globally
See -> [EUROPE`S CENTRAL BANK AT SEA](<brain://local/4xEXcruqoTA6jqWNdKu-7w/j1JGJlgtElWbEUcSyomFlw/EuropesCentralBankAtSea>)
17August 2011
* Euro zone Growth Slows Sharply in Q2 NB
The euro zone Q2 flash estimate recorded a below-consensus 0.2% q/q GDP growth rate, with France stalling and Germany expanding 0.1%; Italy, 0.3%; and Spain, 0.2%. Core countries' weak performance compared to the periphery suggests some reversal of the dynamics in Q3, based on high-frequency activity indicators and surveys. That said, the steady stream of negative news warrants a substantial downgrade in our growth forecasts for 2011 and 2012.
18August 2011
China’s Unsustainable Growth Model: the Rising Risk of a Hard Landing after 2013 NB
By Nouriel Roubini: Excessive investment—now close to 50% of GDP—has created a latent debt problem and massive overcapacity that eventually will slow down economic growth and could lead to a hard landing (i.e., a sharp slowdown in growth to 5% or lower). Until the change in political leadership in 2012, China’s policy makers may be able to maintain high growth with investment, to ensure a smooth transition. But in 2013, China’s unbalanced growth model will start showing signs of strain. To stave off a hard landing, China needs to work toward a more sustainable growth model. We are somewhat pessimistic that China will be able to significantly increase the contribution of consumption to growth before the investment boom turns into a bust.
1. Russia: Longest run of failed bond sales this year 2011as credit slows – Russia Credit
2. Bahrain Shiites
3. ECB daren’t blink first as it stares down bond market yields: Euro Credit
4. Denmark regional banks dump assets to avoid international funding wall.
5. Middle East Bonds rise as investors seek safe haven
6. Fosters rejects SAB Millers bid as it seeks a higher bid
7. Debt funds dropped as gold inflows jump 74% in deficit crisis. India credit
8. Gold- China & India increase purchases-Marcus Grubb- World Gold Council Interview on Bloomberg
9. Barclays sees ‘real completion’ from China firms on international deals
10. Swedish banks told to gird for second European crisis
11. SA 2015 bond yields may extend record low of 6.5%- BNP says
12. GOLD: Dubai- $21.17 billion gold traded in 2010. Launches gold bullion coin.
13. US Regulators step up scrutiny of European local banks
14. Deutsche bank faces Breuer trial as
15. Buy emerging markets equities as slowdown priced in-CitiBank
16. Morgan Stanley downgrades European Union growth forecasts 2011/12
17. China`s holding of US treasuries currently stands at $1.17 trillion. VP Biden is in China to meet successor Hi to assure that U.S. is good for debt
18. Japan tries verbal intervention as Yen remains near post World War 2 high
19. Interview: Stephen Gallo- Schneider Exchange head market analysis (Worlds most renowned FX authority.)SNB refrains from Euro peg. The Yen is in a structural uptrend. Japan is not exporting the degree of capital as it used to do. It is very uncertain market and watching China very closely.
20. Dubai investors seek a haven in gold as limits are being put as demand outstrips supply. NB
21. US stock futures drop; treasuries rise
22. Chavez empties UK vaults of gold and brings it home
23. FED Warning: Its not their job to prop up shares
24. S&P; 500 futures- down 2.07% NB
25. Estonia urges
26. Taiwan`s economy grew 5.02% in Q2 above economists’ forecasts
27. Morgan Stanley says U.S. close to recession.
_22 August 2011 _
1. Biggest default swap jump since 2008 triggered by oil slump. Russia Credit
2. Emerging markets bonds ratings don’t matter after BUNDS rally
3. GOLD $1891 heading for the biggest markets gains in 32 years as investors flee to safety
4. YEN, FRANC weaken amid speculation Central Banks to intervene
5. Libyan rebels take over Tripoli and confirm Qaddafi sons have been taken prisoner. Qaddafi 42 year reign ends and on the brink of collapse
6. Merkel says she will resist pressure for common market Euro Bonds
7. Treasuries price in QE3 as Barclays says traders expect R500 billion
8. Japan may declare Fukushima areas uninhabitable for 10 years
9. Italy`s debt burden may balloon as austerity measures smother growth. EURO Credit
10. SA stocks decline led by BHP Billiton, Anglo, SAB Miller, Richmond & SASOL
11. Europes financial debt risk surges- bank stocks down 38%.CDS costs rise for Europes Banks
12. Deutsche Bank brokerage faces charges
13. Secrets of the Fed; see Blomberg review of beneficiaries of $1.2 trillion in secret loans. Fed opens its books on the crisis
14. US & Europe stocks rally on expectations of QE3, Bernanke stimulus plan
15. Mobius predicts that stocks will rise
16. El –Erian, Feldstein-Fels on prospect Europe will evolve into a new core.
17. Canadian banks may defy economic slowdown with 14% growth
18. US Stocks advance on speculation that Fed will make more asset purchases
19. Kenya tea production declines with drought
20. Hungarian equities rebound after longest losing streak since 2003
21. Aquarius shares decline most since May as Zimbabwe rejects ownership proposal.
22. US Nearly 1; 10 homeowners delinquent
23. Fed handed out $1.2 trillion in secret loans during crisis. 29 Dec 2008, Morgan Stanley borrowed $107 billion, Citi $99 Billion act.
24. Mobius says stocks will rebound after bouncing along the bottom
23 August 2011
1. Hong Kong scary 7,9 % inflation
2. Singapore inflation the highest since January effects housing
3. Biden sees a chance of getting a very difficult deficit deal done by deadline. Biden has being wooing China the past week to ensure that the the US is still good for debt obligations
4. GOLD tops $1910 for the first time. A review of gold time frames to jump by $100 is getting narrower. When Gold was $1600 it took 5 weeks. The recent increase from $1800-1900, has taken a week
5. UBS to cut 3500 jobs through attrition retrenchment after scrapping profit target amid weakening growth
6. Lebanon debt safer than Dubai`s based on cash rich local lenders
7. NB. Bloomberg Interview: Prof. Edmund Phelps (Nobel Economic laureate).US fiscal situation is dire to the tune of $66 trillion. The U.S. will need a ‘war footing” combined with tax increases and other cutting measures to challenge this crisis. There is not a strong case for QE3. Overhaul needed in corporate governance. The banks don’t have to hold any reserves against acquiring Government debt and the Governments unholy alliance with Banks has created the problems today
8. Europe`s failure to solve banking crisis returns to haunt markets.
9. Spain sells $2.94 billion in bonds with increased demand
10. SA to react appropriately amid growth slump-Marcus says
11. SA to be ‘vigilant’ on the stability of SA banks- Gordhan says
12. Hungary will leave benchmark interest rate unchanged to stem forint drop
13. Goldman legal concerns. Blankfein hires criminal defence lawyer as Goldman faces criminal charges after Levin report brings in Justice Department. Shares continue to drop 27.42%- this year from $175 to $106 current See Wall Street watch list.
14. NB.William Cohan book.” How Goldman Sacks came to rule the World “. Goldman has been around for 140 years and is very nimble and could make a lot of money in this market. But if Goldman is indicted, this will be difficult to prove , but anything is possible these days.
15. S&P; Deven Sharma to leave by year end and to be replaced by CitiGroup Peterson after U.S. downgrade from AAA
16. Gold price declines from $1910 to $1883.47 as investors take profit. (JS>Just temporary- wait for the next $100 jump!!)
17. Bank of Kigali says 40% of IPO shares acquired by international investors
18. German confidence falls more than forecast as debt crisis threatens growth
19. Denmark banks expect bailout from pooled funding
20. Libyan rebels search for Kaddafi in Tripoli
21. Unlocking Libya $168 billion in frozen assets Libyan Investment Authority has $62 billion in stocks & shares which no one is managing & $160 billion in bonds. Scrambling for Libyan assts & oil
22. US stock futures rise on speculation of FED QE3
23. Fosters to return $525 million to shareholders to thwart SAB Miller takeover NB
24. European banks must pay up to borrow $100 billion amid crisis- euro credit
25. Gold stocks have a lot of gain with gold jumps- PM says
26. Finland would consider alternative Greek collateral models- Katainen says
27. British American Investment Kenya gets bids for 60% of shares on offer
28. Polish economic growth may still reach 4% next year Finance Minister says
29. Merkel never holding hands with Sarkozy betrays European leadership crisis
30. Russia may postpone sale of Sberbank Government stake- Vedomosti Reports
31. Sberbank studies purchases of Poland
32. Jumping swap rate means Ruble supply eroded as oil tumbles- Russia Credit
33. Asia stocks rise on speculation of FED QE3
34. Korea adds $78 million in share purchases amid stock rout
35. Spain borrowing costs decline with $4.3 billion sale of Bills (2.9 billion Euros) as demand rises
36. Denmark banks expect lifeline from pooled fund NB
37. After Kaddafi demise, Libyans still have to rebuild economy
38. Hurricane Irene strengthens to Category 2 (100 mph)storm en route to the Bahamas, U.S. coast-the first for the season
39. AIG falls 24% $25-21
40. SA: Shoprite to accelerate expansion to challenge Wal-Mart entry into SA
41. UN to investigate Syrian war crimes
42. US $30 billion left equity mutual funds to avoid high-frequency speculation. Bernanke ‘feeling pressure’ to act after market downturn- Howard WARD. CIO Berdanko
43. Treasury stock holdings in AIG, GM drops by $13 billion as S&P; falls
44. Wiki leaks: Julian Assange documents on BOFA destroyed by Assange 2nd in command
45. Morgan Stanley- the company that borrowed the most from the Fed bailout ( $1.2 trillion) for $107 billion in low interest loans.
46. Bloomberg Interview: Brad Hintz analyst at Sanford C. Bernstein analyst and former CFO at Lehman discusses the secret fund bailouts of the Fed. The Hedge Funds were pulling out money at the height of the 2008/9 crisis. CDS were used to short and Morgan Stanley had to dodge a near collapse of banking system.’ Not surprising that banks borrowed $1 trillion from the FED as US banks came close to falling like dominoes before Fed program.’
47. Chavez repatriates Gold
48. News Corp pleases investors with a $5 billion share buy- back. Buying 3-4 million shares each day. A big hit with News Corp investors
49. Rand gains after China manufacturing report eases growth concerns
50. Gold spot $1878 ( 2pm SA time0
51. Banking crisis rises to a record as Euro default deepens
52. Santiago bourse sees record IPO`s this year
53. William Cohen US Sect. of Defence: $30 billion in frozen Libyan assets may take 2 years to release depending on stability
54. European failure to stem banking crisis returns to haunt markets
55. Silvers ‘neckline’ may see a return to a 31 year high
56. Mark Kiesel (PIMCO analyst) still interested in buying Banking bonds. Corporate credit opportunities. Tier 1 capital have risen at major banks. The economy is delivering and government is going to face liquidity pressures, therefore Banks exposed to consumers are problematic. Favours resource stocks that are strongly asset based
57. World in a recession as resource stocks indicate downside towards a double dip recession
58. Japans Nikkei average rises 1%
59. Most US averages on track for biggest losses since 1998
60. Euro Rand 10.38, Yen rand .0937,Euro $ 1.4466, Brent Crude $108
61. Boeing glut of $18.7 billion awaits FAA approval
62. Euro area services/ manufacturing declines to the worst in 2 years
63. Greenspan: U.S. is not going into a double dip recession.
64. Greenspan says Europe is breaking down and questions banks collateral
65. BOFA down 5.4% , Goldman 1,2%. Watch these stocks for further downside
66. McGraw Hill shareholders put forward a plan to break up company into 4 parts
67. European stocks erase advances made in, mining, travel and banks fall.
68. LBO loans burden banks with the biggest discounts in 11months- EURO Credit
69. Pakistan to plug aid with Sukuk bonds
70. Texas sells a record $10 billion in notes after cuts for schools
71. PEPSI trails COKE in Bond Market after takeover spree
72. SA`s overvalued rand debilitating says SA Trade Minister
73. US FDIC problem bank list (888>852) shrinks for the first time since 2006. ( $28b profit report for all TARP banks)
We may not recognise this world by this time next year!
24 August 2011
1. Serbia new IMF loan agreement may be delayed as a result of deficit
2. Bank of China first half profit climbs 28% with loans
3. Oil Rich Libyans won`t need capital post Kaddafi
4. Libya to sell its own oil now , not Qatar anymore-Jebril says
5. Japan unveils a $100 billion to avoid surging Yen as Moody`s lowers rating
6. Japan gives firms access to $100 billion in Yen to help with exports and purchases
7. European banks job cuts release 40 000 and UBS 5% of workforce
8. Denmark`s stimulus package may fail to avoid a ‘long painful adjustment’
9. Libyan conflict cost $15 billion. Frozen assets $106 billion in Central Bank assets & $64 billion in Sovereign Wealth funds with Libyan Investment Authority and $50 billion in cash
10. US futures decline, Treasury yields increase, YEN strengthens
11. Heineken drops most on record with weakening growth
12. EU Regulator flip flops over short selling ban and stokes investors anger
13. SA inflation rate rises to 5.3% on fuel & energy prices
14. East European Swiss Bank loan defaults may fan euro contagion crisis-UBS says
15. Irene likely to become a major hurricane today
16. BOFA shares slide below $6 ??? as cask on hand values the Bank at $7 and market valuation $9.5 to $11.
17. BOFA-Countrywide Investigation by Justice department.
18. MUNI marker heading for default
19. Euro industrial orders unexpectedly slumped in June amid Germany slow down.
20. TULLOW to invest $4 billion in Ghana oil to increase production
21. German business confidence plunges- Klaas Baaber Societe Generale
22. Greek 2 year Bills reach all time record of 40.47%, highest since Euro introduction
23. Imperial seeks more purchases to boost growth at logistics unit
24. BHP profit reaches a record as Chinese demand fuels gains
25. Quanta’s 2nd quarter profit slumps 83%
26. SA World 2011 rugby cup team includes 18 players from victorious 2007 World cup team
27. Rugby world cup gives New Zealand the opportunity of a lifetime-Minister says
28. Irish Bonds suggest Dublin Debt saved Athens-Lisbon suffer-Euro Credit
29. Egypt bad loan levels signal lenders defy economic slowdown- Arab Credit
30. S& P upgrades Slovak credit rating to positive
31. McGraw Hill seen returning 40% more in pieces
32. David Blanchflower-Economics professor at Dartmouth College & bank of England economic analyst-QE3 is the only show in town, quantity easing is the only FED only tool to cure economy
33. Oil Rigs revisit Lehman crisis as credit squeezed for orders
34. Straus Khan may face French probe after NY charges dropped
35. Oil drop muted as Libya struggles to resume production-Energy Markets
36. Syria kills protesters as UN Nations intensifies action
37. Chile weathering global slowdown with growth of 5% for 2012
38. Putin offers lowest premium since June even as yields rise
39. NY 5.9 quake the most powerful since 1944
40. Harmony gold targets 19% production increase
41. Financials weigh down on corporate bonds
42. Funding stress seen in the widest SWAP SPREADS since July 2010
43. German business confidence falls to the lowest level in a year as crisis continues
44. New Africa properties to list in Botswana 28 September after share sale
45. Namibia Central Bank keeps rate unchanged at 6%
46. Biden says he didn’t go to China to explain a ‘damn thing’ about economy
47. Fosters CEO spurning SAB Miller remains open for a sensible offer
48. Harmony Gold targets a 19% production increase as Gold prices reach an all time high
49. Michael Holland (Founder of the Holland Balanced Fund, Vice Chairman of Opperheimer & Co) –the rumours and whats going on in this market is crazy, like the share drop in BOFA $15.25> $5+ in a year. Markets are being driven by emotion not logic. Bernanke actions historic and history will judge him better than current critics. No ‘political will’ for QE3. GREAT US COMPANIES ARE SELLING AT A ONCE IN A LIFETIME OPPORTUNITY.
50. Greece ties to Israel deepening in crisis along with Russia
51. Regulators lack the tools to analyze ‘risk’ in Derivatives
52. Banks in the US face main street squeeze
53. Greek note yields surge to new highs with another bailout looming
54. European Union likely to be a NEW core of countries- says Estonian President Ilves
55. BLOOMBERG ANALYSIS of FED SECRET LOANS: JP Morgan & State Street- FED lent, they bought money market securities and resold at no risk. State borrowed $89 B and made $ 76 m & JP $92 million. Taxpayers made $9 B off Fed loans -Holland
56. Bloomberg: THE FEDS SECRET $1 Trillion Loan program. Get new detail. Fed loans were risk free. Fed loaned funds to make markets work. SEE ARTICLE FROM BLOOMBERG TODAY
57. GOLD rises from drop off record.
58. Egyptian pound grows most since January , last Central Bank Intervention
59. Wealth destroyed BOFA down 62% & JP 42%
60. Rand /$ 7.17
26 August 2011
* Observations From Nouriel Roubini NB
* “Globally, a sharp slowdown of China’s growth would have a disinflationary effect via prices of traded goods. Commodity prices would plummet as Chinese demand would drop. Plus, China would dump excess supply of industrial and manufactured goods—steel, cement, aluminium, cars, apparel, consumer electronics, etc.—into global markets. Even today, with growth still above 9%, there is so much industrial overcapacity in China that the excess is already exported in global markets, hurting foreign producers of these traded goods. For example, in spite of the demand for steel for highways, railroads, airports, real estate, etc., there is so much overcapacity in China that a lot of its steel is exported abroad, hurting the market share and profitability of global steel producers. The rest of the world is already concerned about China’s exports; these trade tensions would escalate if China were to witness a plunge in domestic demand and dump the excess capacity in global markets. If China has a hard landing, either massive global deflation or severe trade wars will result.”
* Oil Prices: “In aggregate, we expect the global economy to be able to weather oil prices in a US$90-100 range, with higher inflationary pressures and only slightly weaker growth, but we expect significant demand destruction and output losses at an oil price above US$120/barrel. In the event that tensions heighten and we reach a price of US$120/barrel, demand destruction will take effect globally, with geographic and demographic variations such that this level may not be sustainable for the long term, given increased production incentivized by higher prices.”
—Shelley Goldberg, Director of Global Resources and Commodity Strategy, and Rachel Ziemba, Director of CEEMEA and Global Macroeconomic Issues, March 15, 2011
* RGE has argued for some time that oil prices (WTI) above the US$120/barrel mark would lead to significant demand destruction. WTI traded at an intra-day high of US$114.83/b on April 11, while supply disruptions and political uncertainty in MENA added an estimated US$15-20/b risk-fear premium to the price of crude, especially Brent. Consumer sentiment has fallen in the U.S. since March, driven in part by high gasoline prices, while global weakness and demand destruction have gradually brought down the price of crude. Moreover, there is evidence that the high price of crude exacerbated other risks to the economy, contributing to the stall speed in advanced economies and adding to inflationary pressures. High oil prices contributed to the decline in global trade. Despite downside risks to growth, our baseline assumes global oil prices will be supported by supply cuts from OPEC, near-potential EM growth and monetary stimulus.
See -> El-Erian: Interpreting Bernanke’s Jackson Hole speech
_ 30 August 2011 (Tuesday)_
1. Hungary sets up National Mortgage for failed loans
2. Credit Suisse says global demand coal is 2.63 million tons with an insatiable demand. New Zealand accounts for 50% supply
3. Companies stop selling bonds as borrowing costs jump 40%- Euro Credit
4. SA credit growth accelerates with 5.7% interest as loan demand increases
5. SA stocks slide led by Standard & SAB Miller
6. SA economic growth slows to 1,3% and missing economist forecast
7. SA Zuma`s political future depends on his handling of Malema disciplinary meeting
8. Swedish banks may follow Nordea with job cuts as economic growth slows
9. SAB Miller drives up Fosters default swaps
10. European economic confidence falls most since December 2008 since debt crisis
11. Copper climbs for a fifth day in London as US optimism grows
12. Mauritius Reunion Insurance expects premiums to grow 27% this year
13. Mauritius reduces 2011 deficit by 4.8%
14. India faster than expected growth expansion
15. RBS leads British banks higher on upgrade from Deutsche Bank
16. Carrefour may walk away from profit forecasts as store sales slump
17. PUTIN trims debt offer as global economic woes hit demand- Russia Credit
18. Japan joblessness rises; spending is curbed; Noda voted in as 6th Premier in 5 years indicating the lack of leadership
19. Italy sells $3,75 billion of `10 year notes as borrowing costs decline
20. European stocks advance for a 2nd day
21. European bank stocks down 35,5% in 6 months
22. Asian stocks rise and confidence in U.S sales boosts confidence, car sales rise ; Honda & Toyota sales rise
23. Europe`s debt crisis boots clean energy financing costs –Ernest & Young says
24. US stock futures maintain losses as Treasuries advance
25. SA stocks decline. Real Africa rises most in 4 months with listing
26. Kenya`s inflation rate rises to 16.7% creating pressure for Central bank
27. Gross says look everywhere as world economies face economic crisis
28. Croatia shouldn’t rush to feud with Euro area after just being included
29. UK luxury homes rise as overseas investors seek secure assets
30. US-Wealthy use home auction sites to sell homes
31. US august consumer confidence index slumps to 44.5 from 59,2; stocks decline
32. Northgate takeover the lowest since 2004 with record gold prices
33. Poland economy grows more than expected as investment offsets demand
34. Solar surge drives weakest into bankruptcy
35. Gazprom first quarter profit surges 44% to a record $16 billion on high prices
36. On corporate taxes, the U.S should follow the world down
37. Exxon plans projects with Rosneft that may total $500 billion- Putin says
38. IPADS soon to be more expensive than large TV screens- Chart of the Day
39. Boeing 737 upgrade surges orders
40. Nigeria Asset Management Company seeks to limit bond sales to $29.1 billion
41. U.S. consumer confidence falls to its lowest since 09. The U.S as right in the middle of the recession at that time
42. Boeing improves 737 upgrade as new plane orders surge to 500
43. US. Gross: Betting against U.S. Debt a mistake
44. Telkom SA might make a major deal in Africa soon- Minister says
45. CVC partners have questions on Eccelstone formula one allegations
46. Northgate takeover the cheapest since 2004 with record gold prices
47. Sam Zell Equity International- Obama administration created uncertainty. Putting money overseas –India / Columbia next
48. Economic confidence in Europe falls to Dec 08 lows
49. Haven demand
50. Japan new successor PM NODA
51. U.S –one in six banks unprofitable
31 August 2011 (Wednesday)
1. HERMES first half net jumps 49%. ( The rich are still spending & getting richer)
2. Vivendi 2nd Q net increases 12%
3. L`oreal profits lower on higher costs
4. Carrefour (The world`s 2nd largest retailer in 32 countries) abandons profit target with turnover down 15% this year. One third of market value has vanished with economic crisis. Troubled stores in Brazil! Down 42% in 3 years
5. TESCO (retailer) is selling its stores in Japan- 129 convenience stores in Tokyo. (5380 stores worldwide)
6. Euro slides on signs of a faltering European economy
7. Gold Spot $1833
8. U.S consumer confidence declines-QE3 or more asset purchases? Recession likely!
9. Ethan Harris ( BOFA/ Merrill lynch)- US stagnation & economy faltering
10. US –Pentagon prepares to suffer security cuts as a decade long spending spree comes to an end
11. Australian/ NZ dollars continue monthly decline with faltering economy
12. Japan output less than forecast as global slowdown hits post quake slowdown
13. Outlawing Spain / Italy deficits not enough to end debt crisis- Euro Credit
14. Danish banks abused loopholes when reporting losses- FSA Noetgaard says
15. SA rand strengthens against $ in opening trade
16. Exxon clinches deal with Rosneft to drill for 30 million barrels in the Arctic. Exxon to invest $500 billion, and ends BP Arctic dream.
17. SA needs faster and more inclusive growth – Finance Minister says
18. S & P 500 declines and end 4 week high; treasury yields rise; Italy bonds slide
19. FED downgrades U.S. economic growth. FED august minutes in focus
20. Crisis threat influence gains momentum over U.S stock market volatility
21. UK economic confidence drops to a 6 month low as slowdown impacts
22. High yield loan sales collapse as losses deepen to 6.14% - Credit markets
23. SA stocks climb for a fourth days led by BHP Billiton & Anglo
24. Asian stocks rise , paring the worst month in a year
25. Spain- 10 year bond 5,05%
26. Treasuries strengthen-Yen gains-Fed prepares ground for easing as officials debate stimulus moves
27. Asian coal discounts shrinking as Japan rebounds from quake- Energy Markets
28. African Rainbow has longest streak of profit since September 2010
29. African Rainbow profit jumps 83% as chrome & iron ore prices surge
30. Singapore set to gain as Hong Kong follows China on sovereign immunity
31. Libya- Rebels forage for munitions ahead of final assault on Gadaffi birthplace
32. Memory price collapse gives chipmakers choice of takeovers or death: TECH
33. German 2 year notes decline
34. Gold may drop rally as sellers speculate Fed easing
35. LGF- Long term Government financing – Fitch says that the time frames for servicing trillions in loans have been brought forward to 3-5 years
36. Containers slump to a 50 year low as China shipping slows- Freight Markets
37. Alexander Friedman- UBS Wealth Management CIO- Its important for clients to take a longer term perspective. There are opportunities in industry leading companies that are diversified around the world with high dividend paying companies. US Treasuries will not stay ahead of inflation
38. Hungary- 60% of household debt is linked to home loans- Unicredit &... have $100 billion in exposure
39. Shorting gold ETFs on the rise as some investors nervous at Golds current prices
40. SA Mine Nationalization in SA a concern- Minister`s advisor says
41. Bond yields converge with global sovereigns for the first time
42. Subprime bonds gets AAA rating- S & P backs
43. Euro zone inflation set to stay at 2,5%
44. German unemployment fell for August after 26 months
45. Copper climbs for a 5th day in London on U.S. growth optimism
46. Stoxx 600 Banks down 18.99 % for August
47. Romania Dragoi to sell Dollar denominated bonds this year
48. Peru debt rating lifted above Brazil- S & P
49. Danish growth beats estimates as 2010 slump vanishes in revised data
50. Local bonds stall as regulators tackle $1, 7 trillion in debt. China Credit
51. China says no ‘need to panic’ with potential local state defaults
52. China top priority is to stabilize markets
53. China- S&P; says there is much more local state debt off balance sheet which will surface over the next 3-5 years
54. Icahn to sell Lions Gate shares at $7 to end feud
55. Seberbank beats Unicredit as bad loan drop spurs profit
56. European stocks rise for a third day as regulators attempt to arrest decline
57. Uganda annual inflation rate climbs to 21,4%, the highest since 1993
58. IKE prophetic ‘Military Industry’ speech resonates today
59. MGM`s leverage makes it more vulnerable in market slowdown
60. Jan Randolph -Spain`s proposed new deficit rule encouraging sign for Europe. The constitutional amendments a tricky as it takes a long time (decades) to build credibility.
61. Estonia industrial production for July 22.9%, the slowest for 11 months
62. Philippines’ economy slower than forecast
63. Merkel cabinet approves a larger rescue fund
64. Euro zone unemployment 10%
65. Bloomberg Interview-George Magnus - UBS Investment Bank- Perils of the pursuit of profit. Employment, Ease household debt, Bank lending, target growth. Need keep growth going that and encourage the pivate sector even if it means lowering taxes. Cut payroll taxes , special zones to encourage investments , INVEST & HIRE by listed companies. Big companies have large cash holdings and with gloomy prospects the 2012 budgets will be streamlined. Government & Central banks can do loans for investments in the future. The ‘sea legs’ of the private sector is very weak. Job creation the key to growth. We had a bungee jump out of the abyss , but far from out. Bank recapitalization is crucial to Europe, but leadership is failing (. Get his new book)
66. DAX down 17% this year. August the worst month for Germany in 9 years. European banks clobbered. German banks particularly hit hard with European banking system crisis
67. S&P; rates subprime bonds (AAA) higher than U.S Treasuries (AA).(1) The loans are dispersed among securities.(2) Underlying loans are backed by collateral
68. Black Libyans targeted by Rebels like sub-Saharan Africans. Kaddafi employed mercenaries
69. Ghana to borrow $250 million for cocoa buying- board deputy says
70. French embrace of NATO power is a huge step forward
71. Capital, profitability rules may cut bank profits to 11%
72. Luxury & bargain retailers profiting. There is a lot of cash out there amongst wealthy which has to be spent. Top 20% luxury consumers account for 70% of revenue
73. Slovenia economic growth slowed in Q2
74. US 10 year treasury 2.17% the 200% debt is a cry for a revolution.
75. Credit default swap indexes fall in Europe on Fed speculation for further stimulus
76. Frontline rises in Oslo as investors cover short positions
77. Israel unemployment drops to the lowest levels since 1985
78. LUKOIL quarterly income rises 67% to $3.25 billion
79. Scientists develop synthetic ant-sun compound based on those found in coral
80. Greek debt swap is attracting more banks to date
81. HP slashes price of touchpad to $99 from $399. The reduced price attracts sales
82. Frontline climbs in Oslo as investors cover short positions
83. SA posts its biggest deficit in 6 months as exports slump
84. U.S. flies to block T-Mobile takeover of AT&T; ( ant-Trust Case)
85. Roubini says U.S. entering a recession based on his numbers and fiscal stimulus need