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Hugin

(32,778 posts)
Tue Dec 20, 2011, 10:32 PM Dec 2011

STOCK MARKET WATCH, Wednesday, December 21, 2011.

[font size=3]STOCK MARKET WATCH, Wednesday, December 21, 2011[/font]


SMW for Dec 20 2011
AT THE CLOSING BELL ON December 20, 2011
[center][font color=green]
Dow Jones 12,103.58 +337.32 (2.87%)
S&P 500 1,241.30 +35.95 (2.98%)
Nasdaq 2,603.73 +80.59 (3.19%)
2 Year 0.25% +0.01 (4.17%)
5 Year 0.85% +0.01 (1.19%)
10 Year 1.92% +0.06 (3.23%)
30 Year 2.93% +0.09 (3.17%)
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[font size=2]Market Conditions During Trading Hours[/font]
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[font size=2]Euro, Yen, Loonie, Silver and Gold[center]

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[font color=black][font size=2]Handy Links - Market Data and News:[/font][/font]
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Economic Calendar
Marketwatch Data
Bloomberg Economic News
Yahoo Finance
Google Finance
Bank Tracker
Credit Union Tracker
Daily Job Cuts
[/center]



[font color=black][font size=2]Handy Links - Economic Blogs:[/font][/font]
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The Big Picture
Financial Sense
Calculated Risk
Naked Capitalism
Credit Writedowns
Brad DeLong
Bonddad
Atrios
goldmansachs666
The Stand-Up Economist
[/center]



[font color=black][font size=2]Handy Links - Government Issues:[/font][/font]
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LegitGov
Open Government
Earmark Database
USA spending.gov
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Financial Sector Officials Convicted since 1/20/09 = [/font][font color=red]12[/font]


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[font size=3][font color=red]This thread contains opinions and observations. Individuals may post their experiences, inferences and opinions on this thread. However, it should not be construed as advice. It is unethical (and probably illegal) for financial recommendations to be given here.[/font][/font]
93 replies = new reply since forum marked as read
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STOCK MARKET WATCH, Wednesday, December 21, 2011. (Original Post) Hugin Dec 2011 OP
THERE You Are! Demeter Dec 2011 #1
I'm having a heck of a time with the toons. Hugin Dec 2011 #6
This toon shows for me today! DemReadingDU Dec 2011 #19
Well, that's a really good one. tclambert Dec 2011 #87
How Central Banks Attempt to Prop Up the Economy By Eric Fry Demeter Dec 2011 #2
And It Works FAST Demeter Dec 2011 #23
Why...gasp! he is implying the markets are ...rigged! dixiegrrrrl Dec 2011 #78
Strong take-up of ECB loans expected Demeter Dec 2011 #3
US oil boom town prompts fears of crude glut Demeter Dec 2011 #4
Top House Democrat demands explanation of penalties for late foreclosures (FROM NOVEMBER) Demeter Dec 2011 #5
hmm..had no idea.... dixiegrrrrl Dec 2011 #79
E-Mail Clues in Tracking MF Global Client Funds MUST READ Demeter Dec 2011 #7
"Corzine. You will pay the JP morgue or swim with the fish" signed, Jamie. n/t Po_d Mainiac Dec 2011 #18
To JP westerebus Dec 2011 #37
they often confuse aquariums with septic tanks. n/t Po_d Mainiac Dec 2011 #54
I saw the subject line Tansy_Gold Dec 2011 #46
The weather? Bad enough that I may start bitching about it. Ayuh. Po_d Mainiac Dec 2011 #53
Asian Stocks Join Global Rally On US Data Ghost Dog Dec 2011 #8
BoJ Cuts Economic View For Second Month; Holds Key Rate Ghost Dog Dec 2011 #12
China Seeks $536 Billion of Investments to Protect Environment Ghost Dog Dec 2011 #15
Japan's exports fall for second straight month xchrom Dec 2011 #38
Stocks and euro gain ahead of ECB tender Ghost Dog Dec 2011 #9
ECB 3-year Loan Allotment Exceeds Forecast Ghost Dog Dec 2011 #10
Dollar Claws Back Early Losses Versus Euro; ECB Springs To Action Ghost Dog Dec 2011 #29
Bank Of England Policymakers Unanimous In Leaving Rates, QE Unchanged Ghost Dog Dec 2011 #11
Moody's: UK Faces 'Formidable' Challenges Ghost Dog Dec 2011 #13
UK slides further into recessionary territory as confidence hits three-year low Ghost Dog Dec 2011 #14
diluting the Sterling worked so well for them in the past n/t Po_d Mainiac Dec 2011 #17
1984 real life.........WASF Po_d Mainiac Dec 2011 #16
Why Are We Forced to Worship at the Feet of 'Mythical' Financial Markets Controlled by the Elite? xchrom Dec 2011 #20
it's not loading the link correctly -- why i don't know -- but it's at alternet. nt xchrom Dec 2011 #21
finally -- it took! nt xchrom Dec 2011 #24
happy channukah! xchrom Dec 2011 #22
Ditto! Demeter Dec 2011 #25
the dreidle song -- w/ disney! xchrom Dec 2011 #28
That Was...Unique Demeter Dec 2011 #35
my biggest treat was harvey fierstein and his 'im too rich and gay'... xchrom Dec 2011 #39
Ditto!! Ditto!! Tansy_Gold Dec 2011 #49
to harvey! xchrom Dec 2011 #52
Ditto DemReadingDU Dec 2011 #43
MMrrmppff.....whaaaa the hell was that???? dixiegrrrrl Dec 2011 #80
i know, huh!?!?!?! xchrom Dec 2011 #82
Yep, tis the season! Hugin Dec 2011 #34
Mazel tov! n/t westerebus Dec 2011 #48
Bill Black's Handy Guide to Bankster Fraud, From 'Small Fraudulent Fry' to 'Septic Tank Scum' xchrom Dec 2011 #26
Kenneth Rogoff: The eurozone will cast a lengthening shadow in 2012 Demeter Dec 2011 #27
Europe's banks scramble for cheap ECB loans xchrom Dec 2011 #30
Futures down. Hugin Dec 2011 #31
Ew, does anyone have the Chutzpah required to post the, "It's Working" piece about Chopper Ben? Hugin Dec 2011 #36
Bernanke Prods Savers to Become Consumers ( Bloomberg ) Hugin Dec 2011 #42
At .01% Interest! Hurry Now! Demeter Dec 2011 #44
Maybe if you just post the link--and label it "Humor"? Demeter Dec 2011 #60
DU now has a Humor Group. Hugin Dec 2011 #62
But would it be understood? Demeter Dec 2011 #64
Kinda like insider trading??? n./t Tansy_Gold Dec 2011 #70
Are You Happy That Your Tax Dollars are Going to Crush #OWS and Other Occupations? Demeter Dec 2011 #32
BP to exit solar business after 40 years Demeter Dec 2011 #33
I'm not sure 40 years of squelching Solar Power... Hugin Dec 2011 #56
Precisely Demeter Dec 2011 #61
I was thinking the same thing Tansy_Gold Dec 2011 #71
Can We Afford Medicare? By James Kwak Demeter Dec 2011 #40
Fleet of Wahhhhhmbulances Arrive to Carry Off Grieving 1% Demeter Dec 2011 #41
They can always opt to share some of that money, which is making them so miserable. Hugin Dec 2011 #50
Anti-war banker ordered to pay taxes Mike Doyle Demeter Dec 2011 #45
Bad Lawyering, pay the tax and sue for a refund, that way you get a jury happyslug Dec 2011 #84
Thoughts on Europe and the global synchronised slowdown Demeter Dec 2011 #47
Tom Miller Can’t Even Lie Well Anymore: No Deal By Christmas, Banks Up Demands As AGs Leave Table Demeter Dec 2011 #51
FHFA’s DeMarco Considering Backdoor Bankruptcy Principal Modification Program for Freddie and Freddi Demeter Dec 2011 #55
Obama and Geithner: Government, Enron-Style Demeter Dec 2011 #57
Obama and the Rule of Law MUST READ Demeter Dec 2011 #58
Down 31 pts at open Demeter Dec 2011 #59
Nope! No Correction for Xmas Demeter Dec 2011 #92
New forces are driving the world economic order xchrom Dec 2011 #63
Interesting blog post by Mohamed el-Erian FarCenter Dec 2011 #72
i would say the eu is nailing down the procedures for moving wealth to the already wealthy. xchrom Dec 2011 #73
Ordoliberalism FarCenter Dec 2011 #86
Do you have something further to say beyond a link xchrom Dec 2011 #89
The Germans in particular are in the ordoliberalism school, which rejects Hayek and the Austrians FarCenter Dec 2011 #90
Except that's not exactly the way it's working, if youre xchrom Dec 2011 #91
Moody's downgrades Egypt, on review for further action Ghost Dog Dec 2011 #75
and i was just wondering to myself about egypt today. xchrom Dec 2011 #76
Banking: the gift that keeps on giving – just not to you xchrom Dec 2011 #65
Fleeing Greeks bank on new Australian gold rush xchrom Dec 2011 #66
Do you think this is intentional policy, or just desperation? Demeter Dec 2011 #68
anything i would say would be uninformed opinion -- but xchrom Dec 2011 #69
ECB loans highlight funding pressure on eurozone banks xchrom Dec 2011 #67
Italian, Spanish bonds yields jump after ECB tender Ghost Dog Dec 2011 #85
Backlash from Beijing raises fears that China's economy is slowing down xchrom Dec 2011 #74
Love the video links dixiegrrrrl Dec 2011 #77
Economy sees first signs of nasty drop {japan} xchrom Dec 2011 #81
Cartoon. I looked up the motel 6 in Riverside, $49.99 a night, vs $142 at the jail. 2 meals, though jtuck004 Dec 2011 #83
Does Motel 6 have guards? tclambert Dec 2011 #88
You Want Protection at a Motel 6, You Bring Your Own Guards Demeter Dec 2011 #93

tclambert

(11,080 posts)
87. Well, that's a really good one.
Wed Dec 21, 2011, 06:00 PM
Dec 2011

Prison for profit. What could possible go wrong?

You know, Prison Corp. profits most when it gasses the ones with long sentences who never get visitors and just pretends to house them. Sure eventually someone will find out and it all collapses, just like a Ponzi scheme. But in the meantime, you can make big profits, again, just like a Ponzi scheme.

(Why is the spell-checker objecting to Ponzi? And how does the spell-checker work with this new format?)

 

Demeter

(85,373 posts)
2. How Central Banks Attempt to Prop Up the Economy By Eric Fry
Tue Dec 20, 2011, 11:20 PM
Dec 2011

Last edited Wed Dec 21, 2011, 09:59 AM - Edit history (1)

the financial markets are reflecting what our friend, John Mauldin, calls a “muddle through” economy...Notwithstanding Tuesday’s buoyant stock market action, the euro zone is still in crisis, the finances of most governments in the Western world are still in shambles… and Bank of America’s share price is still hovering around five dollars — just like it was in March of 2009, when then-Treasury Secretary Paulson and Federal Reserve Chairman Ben Bernanke were busy patting each other on the back for “saving” the financial system. Toward the end of Monday’s trading session, Bank of America’s share price actually slipped below five dollars per share for the first time since mid-March 2009. That event may or may not be significant, depending upon which rumors one chooses to believe.

One of the juiciest rumors of the moment is that the Federal Reserve is desperately trying to prop up Bank of America, under the guise of helping to “save the euro.”...For example, the last time Bank of America’s share price flirted with five dollars was November 29. The stock hit $5.03 during that trading session before closing at $5.08. The following morning, at the crack of dawn, the Federal Reserve announced its latest “coordinated intervention” with the European Central Bank and a bevy of other central banks. Stock markets around the world skyrocketed on the news. Distressed financial stocks like Bank of America’s skyrocketed most of all.

Therefore, as we noted in the December 5th edition of The Daily Reckoning, “The King Report speculates that problems here at home may have also spurred the cavalry into action. ‘Fed concern about Bank of America was probably a prime factor in implementing the latest scheme,’ says King. ‘If BAC had fallen below $5, there could have been an avalanche of selling because some institutions cannot buy or hold a stock that is less than $5 per share. A cascading BAC could have generated an “Emperor has no clothes” moment for BAC. (Buffett would have been chagrined). So it was imperative that someone closed BAC above $5 on Tuesday and that some scheme had to be implemented to drive the price higher on Wednesday.’

“So just as expected/hoped,” the December 5th Daily Reckoning continued, “the markets rallied sharply on Wednesday, enabling BAC and a few other troubled financial institutions to live to fight another day. But the fight is far from over…and the troubled financial institutions are unlikely to emerge victorious, no matter how many times the central bank cavalry storms into battle.”...As predicted, the central bank intervention announcement on November 30 produced a very sharp, dramatic rally. Bank of America’s shares rallied as much as 16%, while the shares of many other banks and finance companies rallied even more. Nevertheless, by the end of yesterday’s trading session, those fleeting gains had more than disappeared… and there sat a forlorn Bank of America, priced at $4.98 a share...Is it not somewhat curious, that today’s 320 rally seemed to come out of nowhere, on no major news whatsoever? Is it not also somewhat curious that the stock market happened to the soar the very next morning after Bank of America fell below $5?

These kinds of coincidences are almost enough to make me believe crazy rumors.



Read more: How Central Banks Attempt to Prop Up the Economy http://dailyreckoning.com/how-central-banks-attempt-to-prop-up-the-economy/#ixzz1h8O8QlMe

MORE SLEAZY RUMORS AND GRAPHIC PORN AT LINK

 

Demeter

(85,373 posts)
23. And It Works FAST
Wed Dec 21, 2011, 08:52 AM
Dec 2011

We see 300+ DOW, oil prices shoot right back up, and general rejoicing commences among the 1%.

 

Demeter

(85,373 posts)
3. Strong take-up of ECB loans expected
Tue Dec 20, 2011, 11:21 PM
Dec 2011


The European Central Bank is expected to report strong demand for an offer of unlimited three-year loans after banks were urged to take the funds as part of concerted efforts to ease severe strains across the eurozone’s financial system

Read more >>
http://link.ft.com/r/QM42II/U1VISR/RP6QL/4CZJ59/EXR7O6/KI/t?a1=2011&a2=12&a3=20
 

Demeter

(85,373 posts)
4. US oil boom town prompts fears of crude glut
Tue Dec 20, 2011, 11:22 PM
Dec 2011


The boom in North American oil production has triggered a race to expand the US’s main oil storage centre, raising concerns among some industry executives of potential glut in capacity

Read more >>
http://link.ft.com/r/H60H77/8ZETHU/WH2F8/7A5NXJ/62D6U6/PJ/t?a1=2011&a2=12&a3=20
 

Demeter

(85,373 posts)
5. Top House Democrat demands explanation of penalties for late foreclosures (FROM NOVEMBER)
Tue Dec 20, 2011, 11:41 PM
Dec 2011
http://thehill.com/blogs/on-the-money/banking-financial-institutions/193949-top-house-democrat-demands-explanation-of-penalties-for-late-foreclosures-#.TsPooAl9p4k.twitter

A top House Democrat is questioning why government-controlled Fannie Mae and Freddie Mac charged mortgage servicers millions of dollars in penalties for not moving fast enough on foreclosures.

House Overnight and Government Reform Committee ranking member Elijah Cummings (D-Md.) sent a letter Wednesday to Edward DeMarco, acting director of Federal Housing Finance Agency (FHFA), the regulator of Fannie and Freddie, requesting information about $150 million in fees the troubled mortgage giants charged mortgage servicing companies last year exceeding foreclosures timelines.

“I am concerned that these penalties, at least some of which were ordered by the Federal Housing Finance Agency (FHFA), may have contributed to widespread abuses by mortgage servicing companies and law firms attempting to meet arbitrary deadlines to expedite foreclosures,” Cummings wrote.

“The size and timing of these penalties, raise serious questions about whether FHFA may be more interested in expediting foreclosures to clear its books than protecting the rights of homeowners,” he wrote...

dixiegrrrrl

(60,010 posts)
79. hmm..had no idea....
Wed Dec 21, 2011, 01:11 PM
Dec 2011

read today that Fannie and Freddie own about 60% of the mortgages in Cal. tho.
And indeed, when I checked on line, MY house is now "owned" by Freddie Mac.
Meaning at some point they bought the mortgage even tho BOA services it per Countrywide acquisition.

 

Demeter

(85,373 posts)
7. E-Mail Clues in Tracking MF Global Client Funds MUST READ
Wed Dec 21, 2011, 04:09 AM
Dec 2011
http://dealbook.nytimes.com/2011/12/20/e-mail-clues-in-tracking-mf-global-client-funds/

Federal authorities investigating the collapse of MF Global have uncovered e-mails that detail the transfers of money in the firm’s last days, including transfers that contained customer money, according to people close to the investigation. One e-mail chain refers to the transfer of roughly $200 million that MF Global owed JPMorgan Chase on Oct. 28 — the firm’s last business day before it filed for bankruptcy. In that chain, a senior official in the firm’s Chicago office was told to make the transfer, said the people close to the investigation who requested anonymity because the inquiry was still open.

That official, Edith O’Brien, a treasurer at MF Global, is considered a “person of interest” in the investigation, said two of the people, who added that authorities expected to interview her in the coming days. It was not clear who had directed Ms. O’Brien, whose job was to oversee the customer money, to make the Oct. 28 transfer. The roughly $200 million that JPMorgan Chase received is said to be entirely customer money. Ms. O’Brien has hired a prominent criminal defense lawyer, Reid H. Weingarten of Steptoe & Johnson, according to one of the people. Ms. O’Brien has not been accused of any wrongdoing. And there is no indication that she had reason to suspect that the money being transferred included customer money. MF Global’s sloppy recordkeeping and a flurry of transactions in its final days may have obscured the fact that the firm was dipping into the cash of farmers, traders and hedge funds to cover its own needs.

Still, the interest in Ms. O’Brien and the e-mails suggest that, nearly two months after some $1 billion in customer money went missing, investigators have identified employees who may have played an important and perhaps unwitting role in the improper use of customer money...The transfer to JPMorgan was not the only questionable one. Investigators suspect that later on Oct. 28, MF Global continued using customer money to settle payments with trading partners and others, leading to the roughly $1 billion hole in customer cash...MORE AT LINK

Tansy_Gold

(17,815 posts)
46. I saw the subject line
Wed Dec 21, 2011, 10:08 AM
Dec 2011

and i just KNEW who posted it!

How's the weather up thay-uh in your neck o' the woods?

 

Ghost Dog

(16,881 posts)
8. Asian Stocks Join Global Rally On US Data
Wed Dec 21, 2011, 07:20 AM
Dec 2011

CANBERA (dpa-AFX) - Asian stocks rose sharply on Wednesday, as upbeat economic data from the U.S. and Europe and Chinese Premier Wen Jiabao's pledge to support exporters and small businesses eased global growth worries.

With a successful auction driving down Spanish government bond yields, investors eagerly awaited the results of ECB's new 3-year long-term refinancing operation to be unveiled later in the global day to see if banks in Europe are interested in buying domestic sovereign bonds...

... Tokyo stocks rose sharply as a successful Spanish debt auction coupled with encouraging economic data out of the developed economies spurred buying in export-related shares. The Nikkei average rose 1.5 percent, its sharpest percentage rise for the benchmark index since Dec. 7, while the broader Topix index added a percent...

... China's Shanghai Composite index reversed early gains to end 1.1 percent lower, extending declines for the third day, as concerns about an economic slowdown and a cash crunch overshadowed positive economic data from the United States and Germany. However, Hong Kong' s Hang Seng index rose 1.9 percent in thin trading, with resource stocks gaining ground on the back of higher commodity prices...

/... http://www.finanznachrichten.de/nachrichten-2011-12/22267997-asian-stocks-join-global-rally-on-us-data-020.htm

 

Ghost Dog

(16,881 posts)
12. BoJ Cuts Economic View For Second Month; Holds Key Rate
Wed Dec 21, 2011, 07:33 AM
Dec 2011

TOKYO (dpa-AFX) - The Bank of Japan, or BoJ, lowered its assessment of the economy for a second consecutive month at its rate-setting meeting on Wednesday, citing negative impacts from the ongoing debt turmoil in Europe and the appreciation of yen.

The Policy Board decided to retain the key interest rate near zero, but refrained from boosting stimulus despite weak economic prospects.

The central bank kept the benchmark uncollateralized overnight call rate unchanged at zero to 0.1 percent. The asset-purchase program was maintained at JPY 20 trillion, after lifting it by JPY 5 trillion in October. The size of credit facility was left unchanged at JPY 35 trillion.

The bank noted that the moderate pick-up observed in Japan's economic activity in the recent months have paused, due to slowdown in overseas economies and yen appreciation.

/... http://www.finanznachrichten.de/nachrichten-2011-12/22265525-boj-cuts-economic-view-for-second-month-holds-key-rate-020.htm

 

Ghost Dog

(16,881 posts)
15. China Seeks $536 Billion of Investments to Protect Environment
Wed Dec 21, 2011, 07:43 AM
Dec 2011

China needs about 3.4 trillion yuan ($536 billion) of investments for environmental protection in the five years through 2015, the State Council said in a blueprint on pollution reduction.

The government plans to reduce sulfur dioxide emissions by 8 percent, raise the ratio of non-fossil fuels as part of total energy use, lower the ratio for coal, and add 42 million tons of daily sewage treatment capacity from 2011 through 2015, it said in a statement on its website yesterday. Companies and local authorities will be mainly responsible for the investments, while the central government will give support as needed “depending on different circumstances,” it said.

China’s spending on environmental projects is part of a campaign to move the world’s second-biggest economy away from a model that derived most of its growth from exports and investments for roads, railways and airports. Senior Chinese leaders including President Hu Jintao have pledged to bolster domestic consumption, conserve energy and reduce pollution as part of efforts to create more sustainable economic growth.

/... http://www.bloomberg.com/news/2011-12-21/china-seeks-536-billion-of-investments-to-protect-environment.html

xchrom

(108,903 posts)
38. Japan's exports fall for second straight month
Wed Dec 21, 2011, 09:50 AM
Dec 2011
http://hosted.ap.org/dynamic/stories/A/AS_JAPAN_ECONOMY?SITE=AP&SECTION=HOME&TEMPLATE=DEFAULT&CTIME=2011-12-20-22-35-40

TOKYO (AP) -- Japan's exports fell for the second straight month in November, hit by faltering demand from Asia and Europe.

Exports shrank 4.5 percent from a year earlier to 5.198 trillion yen ($66.7 billion), according to a finance ministry report released Wednesday. The result is steeper than October's 3.8 percent decline.

The data underscore the growing pressures facing the world's third-largest economy, which relies heavily on exports to drive growth. A persistently strong yen, Europe's debt problems and the recent flooding in Thailand are eroding gains made since the March earthquake in Japan disrupted manufacturing.

Economists predict economic growth will slow this quarter after the economy expanded at an annualized rate of 5.6 percent in the July-September period.
 

Ghost Dog

(16,881 posts)
9. Stocks and euro gain ahead of ECB tender
Wed Dec 21, 2011, 07:24 AM
Dec 2011

LONDON, Dec 21 (Reuters) - European stocks rallied and the euro was well bid on Wednesday as investors priced in an improvement in the economic outlook and looked forward to a big take up by banks of the European Central Bank's first-ever offer of three-year loans...

... The ECB will offer banks unlimited amounts of low-cost, three-year funds against collateral now more broadly defined, which many analysts hope will encourage buying of high-yielding Spanish and Italian bonds, helping ease the crisis in the euro bloc...

... The FTSEurofirst 300 index of leading shares rose 0.7 percent in early trading, but is still down some 13 percent in 2011, as the euro zone debt crisis and worries about a recession have taken their toll.

The euro stood at $1.312, up 0.3 percent after rising to an Asian session high of $1.31278 on heavy short-covering. The single currency gained 0.6 percent on Tuesday and rose as high as $1.3132, well off an 11-month low seen last week of $1.2945.

German government bonds are edging lower ahead of the ECB operation but in very low volumes as the holiday season approaches... Italian and Spanish government 10-year bond yields have fallen to around 6.62 percent and 5.14 percent respectively, moving further away from the levels above 7 percent that were widely seen as unsustainable...

/... http://www.reuters.com/article/2011/12/21/markets-global-idUSL6E7NK3KO20111221?rpc=401

 

Ghost Dog

(16,881 posts)
10. ECB 3-year Loan Allotment Exceeds Forecast
Wed Dec 21, 2011, 07:27 AM
Dec 2011

Last edited Wed Dec 21, 2011, 08:17 AM - Edit history (1)

VIENNA (dpa-AFX) - The European Central Bank alloted EUR 489.191 billion in three-year loans to banks in its long term refinancing operation held on Wednesday.

The figure exceeded economists' expectations for allotment upto EUR 300 billion. The total number of bidders was 523, for loans that mature on January 29, 2015, ECB data showed.

/... http://www.finanznachrichten.de/nachrichten-2011-12/22268822-ecb-3-year-loan-allotment-exceeds-forecast-020.htm

€489.19bn is definitely at the top end of analyst expectations, and proves that appetite for funding as well as carry-trades (we presume) is extremely high.

That, or there’s simply a lot of low-quality collateral out there which banks feel more comfortable transforming into liquidity via ECB funding operations.

Here’s the entire results table from Reuters, showing no less than 523 bidders:

/... http://ftalphaville.ft.com/blog/2011/12/21/809861/ltro-use-at-e489-19bn/

 

Ghost Dog

(16,881 posts)
29. Dollar Claws Back Early Losses Versus Euro; ECB Springs To Action
Wed Dec 21, 2011, 09:11 AM
Dec 2011

WASHINGTON (dpa-AFX) - The dollar battled back from overnight losses versus the euro Wednesday morning, after the European Central Bank offered a massive loan to 523 euro-area banks in a massive funding operation.

The ECB alloted EUR 489.191 billion in three-year loans to banks in its long term refinancing operation. The figure exceeded economists' expectations for allotment up to EUR 300 billion.

Traders reacted to a flood of economic news from Europe and Asia, ahead of this morning's existing home sales report from the U.S.

The dollar dropped as far as $1.3198 versus the euro, before clawing back to $1.3075 by 7 am ET. A week ago the dollar hit an 11-month high of $1.2944.

The Italian economy contracted in the third quarter mainly led by a fall in domestic demand and investment, and likely entered a recession triggered by the Eurozone's deepening debt crisis, the latest official figures revealed Wednesday.

/... http://www.finanznachrichten.de/nachrichten-2011-12/22270099-dollar-claws-back-early-losses-versus-euro-ecb-springs-to-action-020.htm

The major European markets are also pared some of their initial gains, with the French CAC 40 Index is now trading just above its flat line and the German DAX Index is adding 0.73 percent, while the U.K.'s FTSE 100 Index is moving up 0.53 percent.

Risk-appetite resurfaced earlier as Italian and Spanish bond yields fell yesterday, Chinese Premier Wen Jiabao pledged support for exports and encouraging news out of Europe and the U.S. eased concerns over global growth outlook.

/... http://www.finanznachrichten.de/nachrichten-2011-12/22269900-euro-trims-gains-despite-upbeat-ecb-tender-results-020.htm

 

Ghost Dog

(16,881 posts)
11. Bank Of England Policymakers Unanimous In Leaving Rates, QE Unchanged
Wed Dec 21, 2011, 07:31 AM
Dec 2011

Last edited Wed Dec 21, 2011, 08:08 AM - Edit history (1)

LONDON (dpa-AFX) - The Bank of England's policymaking body was unanimous in deciding to maintain status quo in December, the minutes of the final rate-setting session of the year revealed Wednesday.

The nine-member Monetary Policy Committee, led by Governor Mervyn King, left the size of bond purchases unchanged at GBP 275 billion and kept the key interest rate at 0.50 percent at the end of the two-day meeting held on December 7 and 8.

Policymakers saw little merit in changing the path of asset purchases in December given the magnitude of the current uncertainties, especially those in the external environment, the minutes said. However, the balance of risks to inflation, as projected in the November Inflation Report, suggests that a further expansion of the asset purchases programme might well become warranted in due course, some members said.

/... http://www.finanznachrichten.de/nachrichten-2011-12/22268188-bank-of-england-policymakers-unanimous-in-leaving-rates-qe-unchanged-020.htm


Bank Of England May Print More Money In 2012

The Bank of England has not ruled out more quantitative easing (QE) in the New Year, the minutes of its monetary policy committee (MPC) meeting show.

The bank's policymakers remain concerned that the economic recovery is slow, and believe that more stimulus will be needed to prevent it from slipping back into recession. The institution's inflation report in November downgraded its forecasts for economic growth to below 1% for both 2011 and 2012, and warned that further turmoil in the eurozone posed a serious risk to the economy...

... In an interview with the BBC, Charlie Bean, a member of the MPC, said that the bank was making contingencies for the event of a eurozone break-up. <-- Shifting attention and blame

QE involves printing money to buy government debt from financial institutions, in theory freeing up capital for them to lend into the real economy - to businesses and consumers. The Bank of England's "asset purchase programme" currently stands at £275bn, after it announced an additional £75bn in October.

/... http://www.huffingtonpost.co.uk/2011/12/21/bank-of-england-may-print-money-quantitative-easing_n_1162396.html?ref=uk

 

Ghost Dog

(16,881 posts)
13. Moody's: UK Faces 'Formidable' Challenges
Wed Dec 21, 2011, 07:35 AM
Dec 2011

LONDON (dpa-AFX) - Moody's Investor Service has warned that the U.K. faces formidable and rising challenges, largely emanating from its exposure to Europe and weaker near-term macroeconomic outlook.

In its annual update on the economy, published Tuesday, the agency said that the significant increase in the UK government's deficit and debt metrics since 2008, the weaker macroeconomic prospects and the risks emanating from the euro area crisis mean that the UK's stable Aaa rating has a 'reduced ability to absorb further macroeconomic or fiscal shocks without rating implications.'

The economy's near-term macroeconomic outlook has weakened. Any additional weakening in the economic outlook or a need to support the banking system could temporarily set back the government's fiscal consolidation efforts, Moody's pointed out...

... At the same time, the agency gave the UK government high scores on long-term economic fundamentals, institutional strength, government financial strength and susceptibility to event risk.

/... http://www.finanznachrichten.de/nachrichten-2011-12/22265292-moody-s-uk-faces-formidable-challenges-020.htm

 

Ghost Dog

(16,881 posts)
14. UK slides further into recessionary territory as confidence hits three-year low
Wed Dec 21, 2011, 07:41 AM
Dec 2011

Confidence in Britain's economic outlook dipped to a three-year low during December, with a key indicator of the mood among UK consumers moving further into recessionary territory.

The headline GfK NOP index fell to -33 in December from -31 in November. Consensus had anticipated a drop to -32, fearing the impact of the Chancellor's Autumn Statement which was delivered at around the same time as the GfK NOP reading was taken.

The latest slide takes the index to its lowest point since February 2009.

As well as the overall index figure taking a tumble, three of the survey's five sub-indices also fell, while two were unchanged. The sub-index for the general economic situation over the past 12 months fell by one point to -62, and the sub-index for the general economic situation over the next 12 months dropped by eight points to -41.

The climate for major purchases also appeared to have deteriorated, with the respective sub-index falling four points to -31...

/... http://www.citywire.co.uk/wealth-manager/uk-slides-further-into-recessionary-territory-as-confidence-hits-three-year-low/a554404?ref=wealth-manager-latest-news-list

xchrom

(108,903 posts)
20. Why Are We Forced to Worship at the Feet of 'Mythical' Financial Markets Controlled by the Elite?
Wed Dec 21, 2011, 08:47 AM
Dec 2011
http://www.alternet.org/economy/153497/why_are_we_forced_to_worship_at_the_feet_of_%27mythical%27_financial_markets_controlled_by_the_elite/

The markets are “jittery,” “upset,” “skittish” and “unnerved.” They are “confident” or “unsure.” They are “demanding” that political leaders “put up or shut up.” And they are “reacting unfavorably” to Obama’s newfound populism.

These are just a few of the many ways financial markets are described each and every day by the media, financial players and public officials. At first it seems as if these markets are humanoids onto which we project our feelings. Yet, on closer inspection, it’s more like we have ascribed to them god-like powers. We are told to appease the market gods or face eternal financial damnation. As President Obama warned Europe recently, they must “muster the political will” to “settle markets down.”

Why do we worship these angry market gods?

Trading has been around for as long as humans. We, no doubt, increased our chances of survival through trading what we had more of for what we needed or wanted. The more complex our societies became the more markets grew. At some point during the Renaissance, markets emerged that traded money as well as goods, as city-states and nations sought ways to fund wars. But these markets were far from god-like. Sovereign nations ruled supreme and money-lenders had to do their bidding if they hoped to be repaid or in some cases, if they hoped to

xchrom

(108,903 posts)
39. my biggest treat was harvey fierstein and his 'im too rich and gay'...
Wed Dec 21, 2011, 09:53 AM
Dec 2011
i love harvey to no end.

Tansy_Gold

(17,815 posts)
49. Ditto!! Ditto!!
Wed Dec 21, 2011, 10:15 AM
Dec 2011



Even TG, who is ashamed of how B'way challenged she is, recognized Harvey's voice! (Thank goodness for credits!)




xchrom

(108,903 posts)
26. Bill Black's Handy Guide to Bankster Fraud, From 'Small Fraudulent Fry' to 'Septic Tank Scum'
Wed Dec 21, 2011, 08:55 AM
Dec 2011
http://www.alternet.org/economy/153497/why_are_we_forced_to_worship_at_the_feet_of_%27mythical%27_financial_markets_controlled_by_the_elite

Sixty Minutes' December 11, 2011 interview of President Obama included a claim by Obama that, unfortunately, did not lead the interviewer to ask the obvious, essential follow-up questions.

“I can tell you, just from 40,000 feet, that some of the most damaging behavior on Wall Street, in some cases, some of the least ethical behavior on Wall Street, wasn't illegal.”

Obama did not explain what Wall Street behavior he found least ethical or what unethical Wall Street actions he believed was not illegal. It would have done the world (and Obama) a great service had he been asked these questions. He would not have given a coherent answer because his thinking on these issues has never been coherent. If he had to explain his position he, and the public, would recognize it was indefensible. I offer the following scale of unethical banker behavior related to fraudulent mortgages and mortgage paper (principally collateralized debt obligations (CDOs)) that is illegal and deserved punishment. I write to prompt the rigorous analytical discussion that is essential to expose and end Obama and Bush’s “Presidential Amnesty for Contributors” (PAC) doctrine. The financial industry is the leading campaign contributor to both parties and those contributions come overwhelmingly from the wealthiest officers – the one-tenth of one percent that thrives by being parasites on the 99 percent.
 

Demeter

(85,373 posts)
27. Kenneth Rogoff: The eurozone will cast a lengthening shadow in 2012
Wed Dec 21, 2011, 08:56 AM
Dec 2011

Sadly, the eurozone’s uncertain future will continue to cast a huge shadow over the global economy next year. Surely there are other concerns, including the risk of a not-so-soft landing in China, of pre-electoral paralysis in the US, and of a large, unexpected geopolitical shock.

Even in the most benign scenario, the massive overhang of global public and private debt will hinder any robust recovery in the advanced economies. But the eurozone remains far and away the greatest source of vulnerability.


Read more >>
http://link.ft.com/r/5F39HH/QN6YOK/Q38E1/R3LVNI/YB7TK4/82/t?a1=2011&a2=12&a3=21

I DON'T THINK SO, KEN. I THINK IT FAR MORE LIKELY THE EUROZONE BECOMES A BOTTOMLESS PIT....

xchrom

(108,903 posts)
30. Europe's banks scramble for cheap ECB loans
Wed Dec 21, 2011, 09:17 AM
Dec 2011
http://www.aljazeera.com/business/2011/12/2011122111133916994.html

The European Central Bank (ECB) has offered a massive cash injection by offering three year loans to banks in an attempt to inject investor confidence in the eurozone.

European banks have the first of two opportunities to get the three-year money on Wednesday, as the ECB hopes to sell up to $590bn worth of loans.

It is the ECB's latest and most dramatic attempt so far to help banks bolster their finances.

The move is intended to minimise the chances of banks responding to the current eurozone turmoil by slamming the brakes on lending.


this quote:"If the banks form a kind of cartel and extend that help to the governments, the ECB might be helping sovereigns indirectly"

- Christian Schulz,
Berenberg Bank's senior economist


*** and here i thought they were a 'cartel'.

Hugin

(32,778 posts)
31. Futures down.
Wed Dec 21, 2011, 09:30 AM
Dec 2011

DJIA INDEX 12,020.00 -11.00 08:07
S&P 500 1,232.90 -3.10 08:07
NASDAQ 100 2,263.75 -3.00 08:06

Hugin

(32,778 posts)
36. Ew, does anyone have the Chutzpah required to post the, "It's Working" piece about Chopper Ben?
Wed Dec 21, 2011, 09:43 AM
Dec 2011

Hugin

(32,778 posts)
42. Bernanke Prods Savers to Become Consumers ( Bloomberg )
Wed Dec 21, 2011, 09:57 AM
Dec 2011

Bernanke Prods Savers to Become Consumers
By Rich Miller - Dec 20, 2011
Federal Reserve Chairman Ben S. Bernanke finally may be catching a break: His easy-money policies are showing signs of speeding up the economic rebound three years after he cut interest rates to zero.

Housing may be nearing a bottom as record-low mortgage rates tempt more buyers into the market and confidence among homebuilders climbs to the highest since May 2010. Autos, another part of the economy sensitive to interest rates, are reviving, with carmakers reporting in November their highest sales pace in more than two years.

Banks also are starting to put more of their money to work, expanding commercial and industrial loans last quarter by the most since Lehman Brothers Holdings Inc. went bankrupt in September 2008.

“When the Fed sprinkles happy dust on the economy, we always respond,” said Allen Sinai, co-founder and chief global economist and strategist at Decision Economics in New York. “The happy dust has been out there a long, long time, and I think it finally may be settling in some places.”

More on this here: http://www.bloomberg.com/news/print/2011-12-21/bernanke-money-policy-seen-achieving-goal-as-savers-become-consumers-again.html

*************************************************************

:gah:

 

Demeter

(85,373 posts)
44. At .01% Interest! Hurry Now!
Wed Dec 21, 2011, 10:02 AM
Dec 2011

or...for greater returns, you can buy some of this junk we have lying around....

 

Demeter

(85,373 posts)
32. Are You Happy That Your Tax Dollars are Going to Crush #OWS and Other Occupations?
Wed Dec 21, 2011, 09:36 AM
Dec 2011
http://www.nakedcapitalism.com/2011/11/are-you-happy-that-your-tax-dollars-are-going-to-crush-ows-and-other-occupations.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

Jon Walker at FireDogLake teases out an issue that has probably occurred to many of you: how exactly have these big, and now coordinated, crackdowns on OWS been paid for? In cash-strapped Oakland, for instance, the first big raid, the one in which Iraq war veteran Scott Olsen was critically injured, the city called in forces from 17 different operations. In New York, as the Grey Lady reported in loving detail, the police engaged in extensive, secret rehearsals before going live. This wasn’t policing. It was a military operation.

As Walker writes:

In these bad economic times, cities and other local jurisdictions have been struggling hard to find funds to pay for even the most basic public services, including police. They have been forced to make extremely painful cuts at every level to stay within budget. They simply don’t have large pools of funds to spare.

Either cities like Oakland have decided using massive police force to break up peaceful demonstrations is worth wasting money that could have gone to fund needed city services like schools, public transit and infrastructure repair, or the cities are getting federal money from agencies like the Department of Homeland Security to pay for these military style crackdowns.


It’s even worse than Walker suggests. As we’ve discussed at length, austerity policies backfire economically, by slowing economic growth, which means GDP falls faster than the debt burden does, making debt to GDP ratios worse. Recessions typically hit the lower orders much harder than the rich. And while these crackdowns were nominally about getting rid of the OWS as a eyesore and alleged threat to public safety, it is not hard to see this as an effort to quash a developing mass organization that could stand up to bank/creditor friendly austerian policies.

Look at this video, courtesy Lambert Strether. The number of police involved is stunning, something that has not been adequately conveyed in print media reports. This for a group of maybe 2000 people at 1 AM? There were clearly other considerations at work besides simply clearing the park. A big one, as we have stressed, was keeping the media and anyone with a camera well away from any police manhandling. Another is the “resistance is futile” message, that those who oppose authority will lose when it is roused to show force.

http://www.youtube.com/watch?feature=player_embedded&v=mhQCpXM-Sm4
 

Demeter

(85,373 posts)
33. BP to exit solar business after 40 years
Wed Dec 21, 2011, 09:38 AM
Dec 2011


Cap to troubled year for industry suffering from glut in supply and growing competition from low-cost manufacturers in China

Read more >>
http://link.ft.com/r/XYEWFF/MSH4N9/JQU4J/GDQGRX/62DOV6/D5/t?a1=2011&a2=12&a3=21
 

Demeter

(85,373 posts)
40. Can We Afford Medicare? By James Kwak
Wed Dec 21, 2011, 09:54 AM
Dec 2011
http://baselinescenario.com/2011/12/20/can-we-afford-medicare/

The conventional wisdom, repeated endlessly by the so-called serious people, is that we can’t afford traditional Medicare and hence it has to be radically overhauled (see Ryan-Wyden for the latest round). But I’ve never seen a convincing argument for why we can’t afford traditional Medicare. Yes, costs are rising as a share of GDP. But in principle, to make the case that we have to reform the program, you would have to argue that revenues can’t rise enough to keep pace—which in most cases, just shows that you don’t want revenues to rise enough.

More specifically, you have to know how big the Medicare deficit is and how fast it is rising. By my calculations, relying mainly on the 2011 Medicare Trustee’s report, the deficit was 1.7% of GDP in 2010 and will be 3.0% of GDP in 2040. So the argument that we can’t afford traditional Medicare relies on the proposition that this 1.3% of GDP is the straw that will break America’s fiscal back. Needless to say, this is nonsense, especially since other tax revenues not related to Medicare will be rising over the same time period, at least under current law. For all the details and sources, see my latest Atlantic column: http://www.theatlantic.com/business/archive/2011/12/the-great-medicare-scare-of-2011/250282/

Medicare has its problems. But we have choices.
 

Demeter

(85,373 posts)
41. Fleet of Wahhhhhmbulances Arrive to Carry Off Grieving 1%
Wed Dec 21, 2011, 09:56 AM
Dec 2011
http://news.firedoglake.com/2011/12/20/fleet-of-wahhhhhmbulances-arrive-to-carry-off-grieving-1/

I’ve tended to ignore the litany of “poor oppressed rich folks” articles that have popped up over the last year. It has been exhilarating to see those who get every advantage in American life so weepy because some of the unwashed masses have decided not to love them unconditionally anymore. But it’s just kind of a broken record at this point, and it’s an attempt to work the refs on Capitol Hill so they get even more favorable policies. That’s a game I’m not interested in helping them play. However, you do have to marvel at the way in which the 1% tries to pull off this trick, as if a commentary on income inequality above where it was during the Roman empire is actually just an attack on their character. A case in point:

“Acting like everyone who’s been successful is bad and because you’re rich you’re bad, I don’t understand it,” the JPMorgan Chase & Co. (JPM) CEO told an audience member who asked about hostility toward bankers. “Sometimes there’s a bad apple, yet we denigrate the whole.”

Dimon, 55, whose 2010 compensation was $23 million, joined billionaires including hedge-fund manager John Paulson and Home Depot Inc. (HD) co-founder Bernard Marcus in using speeches, open letters and television appearances to defend themselves and the richest 1 percent of the population targeted by Occupy Wall Street demonstrators.

If successful businesspeople don’t go public to share their stories and talk about their troubles, “they deserve what they’re going to get,” said Marcus, 82, a founding member of Job Creators Alliance, a Dallas-based nonprofit that develops talking points and op-ed pieces aimed at “shaping the national agenda,” according to the group’s website. He said he isn’t worried that speaking out might make him a target of protesters.


Job Creators Alliance’s apparent job is to give a platform for billionaires to whine and cry in public about how persecuted they’ve all become. I would have gone with Martyrs With Nine Zeroes as an honorific but that’s just me.

One actual policy these oppressed rich oppose comes from the Dodd-Frank law, which would require publicly traded companies to actually disclose to the Office of Financial Research the ratio between the salaries of their median employee and their CEO. That’s really the only policy I’ve seen from this whine-fest. So they are going public to defend themselves from having to go public with how much more money they make than their average worker.

It should come as no surprise that this coterie of self-pitying “job creators” lines up pretty perfectly with right-wing Republicans and free-market fundamentalists. Just because this attitude completely crashed the economy about three years ago doesn’t mean they should be made to feel bad about it, however.

Hugin

(32,778 posts)
50. They can always opt to share some of that money, which is making them so miserable.
Wed Dec 21, 2011, 10:20 AM
Dec 2011

Poor babies.

I would use it to set up my planned Organic Dude Ranch. I've already got a sign painted up with the motto,

"Live like the natives do." printed on it.

 

Demeter

(85,373 posts)
45. Anti-war banker ordered to pay taxes Mike Doyle
Wed Dec 21, 2011, 10:04 AM
Dec 2011
http://m.mcclatchydc.com/dc/db_112247/contentdetail.htm?contentguid=3DfieGAG&full=true#display

#Stanford-trained banker Erik M. Thompson told the #IRS he wouldn't pay #taxes because he didn't want to fuel "the government's killing machine" in Iraq and Afghanistan.

Then, the Stanford Business School graduate and former Peace Corps volunteer dragged his feet in responding to IRS queries because, as the Tax Court recounted in a decision Monday, Mr. Thompson said he saw "little distinction between the activities of the IRS and Tax Court and the activities of those good law-abiding Germans who drove the trains to the death camps."

But Mr. Thompson is more than an idealist; he is a businessman of proven accomplishment, eventually rising to serve as chairman of Prairie Sun Bank and founder of Prairie Land and Lumber in his native Milan, Minn. The IRS calculated he had income of $460,000 in 2004 and over $300,000 in 2006, two years in which he didn't file tax returns as a matter of principle.

"My actions are designed to call us back to the rule of law and stop the slaughter of innocents," Mr. Thompson wrote the IRS.

Tax Court Judge Mark V. Holmes rejected Mr. Thompson's ideological argument, as well as his technical tax-related arguments, and admonished him as well that frivolous arguments in the future could bring a $25,000 fine.
 

happyslug

(14,779 posts)
84. Bad Lawyering, pay the tax and sue for a refund, that way you get a jury
Wed Dec 21, 2011, 02:04 PM
Dec 2011

You only go to tax court for two reason, the first is you can NOT afford to pay the tax alleged due, OR you have a very good legal tax argument.

Since this is an ideological point, he would have been better off paying the tax and suing for a refund, that way you end up in Federal District Court AND a jury. Now, it would be rough to get to a jury, the Federal Courts are geared to avoid jury trials if possible. but if you get past the hurtles (i.e. a real issue of fact exists, NOT an issue of law) any factual finding would be up to a Jury.

The problem is, it sounds like he did NOT really have a real factual dispute, he earned the money and the tax was due on it. What the tax is used for is up to Congress not the taxpayer. Thus his opposition to the war was NOT a defense against paying the tax and thus the case would never have reached a Jury trial. Thus he decision to opt for a trial in front of Tax Court. In Tax Court you do NOT have to pay before the trial, but you also have no right to a jury. If you have a good LEGAL argument tax court is the place to be, but if you are alleging anything else you want a jury to decide the facts of the case and the only way to get a jury is to pay the tax and sue, in Federal District Court, for a refund.

 

Demeter

(85,373 posts)
47. Thoughts on Europe and the global synchronised slowdown
Wed Dec 21, 2011, 10:09 AM
Dec 2011
http://www.creditwritedowns.com/2011/12/thoughts-on-europe-and-the-global-synchronised-slowdown.html

European Austerity Union: Most eyes are focused on Europe where the German-led fiscal austerity union is not proceeding smoothly. I continue to be sanguine there in that I expect a late but robust policy response which will mean support for euro government bonds and the broader stock market over the short-term. Over the medium-term, despite easy money from the ECB, there are problems and I anticipate these to come to a head for the situation in Greece and for euro zone economic growth. In the medium-term, through 2012, I don’t expect euro zone failure. I do expect a worsening crisis as poor growth takes a toll. Over the longer-term, however, I am less sanguine. The euro cannot work as envisioned by the Germans. It will see at least Greece leave...The things that I think are actually most relevant over the short to medium term on markets are outside Europe. Here are three events that should be on your radar screen as market watchers:

Chinese housing bubble pops: Global Macro Monitor has run a few pieces on this of late. Now, in April I warned that overheating and an aggressive policy response could eventually lead to a hard landing (ie. 5% growth, down from over 10%). We’re not there yet. But Nomura expects China to run a trade deficit in Q1 2012 as external demand dives for China’s export machine. Moreover, Bloomberg has reported that China’s largest provincial borrowers are ‘deferring payment’ on loans just 2 months after regulators said some local companies would be allowed to do so. Andy Lees of UBS wrote this morning that:

"Hunan Provincial Expressway Construction, Guangdong Provincial Communications, Gansu Provincial Highway Aviation and Sichuan Railway Investment owe a total of more than CNY200bn to banks and plan to defer CNY34.4bn in interest payments according to their bond prospectuses. Fitch says of the Gansu disclosure that "This prospectus is telling us that banks can expect to only receive roughly half of what would have been expected in interest payments". Professor Patrick Chovanec says that if bank capital is being tied up simply rolling over existing non-performing debt, this will crowd out new loan growth. "This is a problem that’s going to start to bite next year".


This sounds like shades of Dubai World if you asked me. China watchers like Shaun Rein and Michael Pettis both argue a soft landing is very doable. Rein recently mentioned "pent up demand and lack of debt among homeowners" as a real economy reason why. That doesn’t mean growth will remain high nor is it bullish for stocks as Rein is bearish on China’s stocks but bullish on the real economy. I think Paul Krugman has a must-read piece out on this topic – and it’s not bullish. Bottom line, China is the story to watch for 2012. http://www.nytimes.com/2011/12/19/opinion/krugman-will-china-break.html?_r=2

Australia housing bubble popping: Moody’s has downgraded Australian mortgage insurers because of ‘tail’ risk in the Australian housing market. In the piece I posted last night, they wrote:

The revised outlooks follow the publication on December 12, 2011 of a report outlining Moody’s negative outlook for the Australian lenders’ mortgage insurance industry (LMI) and reflect the rating agency’s concerns regarding the companies’ exposure to tail-end outcomes in the Australian housing market.

"Although the financial metrics of rated LMIs suggest these firms are well-positioned for the comparatively stable conditions we expect for the Australian housing market in the near term, we believe there are meaningful uncertainties about tail-end scenarios over the mid-term which place downward pressure on the LMIs’ credit profiles", says Ilya Serov, Moody’s lead analyst for the Australian mortgage insurance sector.

While Moody’s views the probability of a severe housing crisis to be low, a greater degree of caution with regard to the future performance of Australian mortgage portfolios is warranted.


These so-called tail scenarios are very tied to China. A booming Chinese housing, infrastructure and property construction market is great for Australian commodity exports. A bust in those markets is bearish for commodities and therefore bearish for Australia and its over-valued housing market. I would actually watch the policy response to the burst bubble and declining export growth in China to gauge the directionality of this incipient Australian housing selloff.

Indian growth slowdown: Christopher Wood, a well-regarded market analysts at CLSA, an India bull recently cut his guidance for growth in India to 6% from 7%. In conjunction with this downgraded growth expectation, CLSA cut Indian equities to ‘neutral’ from ‘overweight’. And Wood has said the Indian Sensex stock market index could go sown even further, even after having traded down into bear market territory. The reserve Bank of India is now cutting rates so India’s currency, the Rupee is at record lows versus the US dollar as well. That’s market bearish for foreign investors.

We are in a second synchronised global growth slowdown. Moreover, the policy response must be more muted this go round as the public sector is more indebted and has less policy space than in 2008 or 2009. Expect policy inaction followed by fits of volatility due to inaction, followed by vigorous policy responses to keep the muddle through from collapsing into Depression. Overall, all of the risk is to the downside, not just in the euro zone but globally.

************************************************

Edward Harrison is the founder of Credit Writedowns and a former finance and technology executive with over twenty years of business experience. He is also a regular economic and financial commentator on BBC World News, CNBC Television, Business News Network, CBC Canada, Fox Television and RT Television. He started his career as a diplomat and speaks six languages, a skill he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.
 

Demeter

(85,373 posts)
51. Tom Miller Can’t Even Lie Well Anymore: No Deal By Christmas, Banks Up Demands As AGs Leave Table
Wed Dec 21, 2011, 10:20 AM
Dec 2011

IT'S DEAD, JIM

http://www.nakedcapitalism.com/2011/12/tom-miller-cant-even-lie-well-anymore-not-only-no-deal-by-christmas-as-promised-but-banks-upping-demands-even-as-attorneys-general-leave-table.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

We’ve commented previously on Tom Miller as the contemporary exemplar of what in the 1960s was called a credibility gap. Readers no doubt know that he is the lead negotiator on behalf of the state attorneys general in what was formerly called the 50 state attorney general [mortgage] settlement. (Notice separately how the state AGs are providing cover for several Federal banking regulators, HUD and the Department of Justice, which are also parties to this deal).

A partial recap: Miller started by promising criminal prosecutions, then reneged. He has refused to do investigations, then had the temerity to try to claim they took place). He said there would not be a big waiver on mortgage liability, when as we discussed, that was the only thing Miller & Co. could offer that would get a deal to the numbers he had unwisely committed himself to (north of $20 billion). And several state attorneys general have walked from the deal precisely because they object to the plan in motion: a big release for an impressive-sounding number, when they have an inadequate idea of how much questionable activity is being forgiven....But the truly absurd part is the continued pretense by Miller that a deal will get done. He’s been saying every few weeks that a deal is weeks away for over a year. In early August, a deal was supposed to be inked by Labor Day. Earlier this month, Miller said a deal would be done by Christmas.

Today we learn (quelle surprise!) that there will be no pact in Santa’s bag. But even more telling, as far as Miller’s veracity is concerned, is another revelation in the report from National Mortgage News. Note that this piece can be characterized as optimistic (or clueless). It keeps up the party line that California attorney general Kamala Harris might rejoin the talks. While she is perceived to be more opportunistic than most state prosecutors, she has been moving further and further away from the settlements. She has teamed up with the most aggressive attorney general, Catherine Masto of Nevada, to investigate mortgage abuses. So look at the little revelation towards the end of the article:

But a new wrinkle emerged last week when reports surfaced that the banks were also seeking assurances from the Consumer Financial Protection Bureau that it would release them from liability related to mortgage origination.

The agency dropped out of any talks on the settlement in the spring, after documents revealed that CFPB officials had spoken with state officials about the settlement. The industry accused Elizabeth Warren and the bureau of meddling in the negotiations — they suggested it was CFPB that proposed the initial $20 billion settlement amount — and Republicans blasted it for acting without any legal authority. Warren insisted that she merely gave advice to the state AGs when asked.

Since then, the CFPB has not been involved in any settlement negotiations, save for an occasional briefing from federal officials.


So get this: we don’t have a deal and the teeny odds of getting one done keep shrinking. The biggest items to be negotiated, the release (this deal is scope of release v. cash, the rest is decoration) is still unresolved (as in the two sides are really far apart, as confirmed by how long this charade has continued). AGs have walked over the concessions Miller made. And the banks keep upping their demands. The bank strategy is negotiating in bad faith, and even talks that are faring well will start coming apart with that sort of conduct....News leaks on the settlement talks continue confirms that when Miller conveys information to the press, you are more likely to be right if you assume what he says to be untrue.
 

Demeter

(85,373 posts)
55. FHFA’s DeMarco Considering Backdoor Bankruptcy Principal Modification Program for Freddie and Freddi
Wed Dec 21, 2011, 10:26 AM
Dec 2011
http://www.nakedcapitalism.com/2011/12/fhfas-demarco-considering-backdoor-bankruptcy-principal-modification-program-for-freddie-and-freddie.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29

Quite a few housing market experts have argued that principal modifications to viable borrowers are the best way to resolve the housing market malaise. In the stone ages when banks kept the mortgages they originated, mortgage modifications including principal mods were standard practice when a borrower got in financial difficulty but was still salvageable. And because these restructurings were done behind closed doors, no one but the banker and his grateful customer were the wiser. But now that servicer bad incentives have meant they don’t do mods unless cajoled or bribed by the government (and not much even then), the topic has entered the public debate...It had appeared that any principal mod program was going to come over the dead bodies of the banks, who have been feigned compliance with various Federal programs but either dragged their feet and/or gamed the schemes. So it was surprising to read that the acting head of the FHAF, Edward DeMarco, is considering what amounts to a principal mod program implemented through bankruptcy courts. As Shahien Nasiripour reports in the Financial Times:

The Federal Housing Finance Agency is “actively considering” a plan that would call for Fannie and Freddie to allow homeowners in Chapter 13 bankruptcy proceedings who owe more on their housing debt than their homes are worth to pay zero per cent interest for five years, subject to approval by bankruptcy judges, according to a letter to Congress dated Monday.


If you were to use a market rate mortgage starting today, five years of payments with 0% interest is roughly 17% of principal. The amortization with a regular payment schedule would be 3%, so you have a 14% difference. Now with typical loans seasoned a few years, the difference between the two amounts would be somewhat less. As reader MBS Guy wrote, “This won’t solve the problem in Nevada or Florida, but it isn’t a bad start if it can be accomplished without congressional (or Administration) approval.” The FHFA is fixated on minimizing losses, so they have presumably taken the view that taking a modest loss is better than a foreclosure. These mods may not be deep enough to make as much a difference as one would hope. But it may also serve to reopen the debate on the cleanest way to cut the Gordian knot of badly designed securitization contracts and disempowered investors: that of bankruptcy cramdowns. If GSE borrowers can get mods in bankruptcy, why are other borrowers, who account for half the mortgages outstanding, left out? And how will the private mortgage market ever come back if GSE mortgages offer this important protection to homeowners, and private label mortgages don’t? The other interesting part of this proposal is that the FHFA wrote to Congress. This is the second end run of the Administration for being unduly friendly to banks that has come to light this week (the earlier one was the HUD inspector general ignoring the usual channel for prosecutions, the Department of Justice, and teaming up with New York attorney general Eric Schneiderman instead). One has to assume that DeMarco is lining up allies in Congress, since the Obama Administration is not backing the plan. Again from the FT:

But the White House said the initiative is not under consideration, angering members of Congress who have tried to get the Obama administration to devote more attention to the slumping property market.


It’s better late than never to see some regulators realize that business as usual on the mortgage front will result in only greater losses to homeowners, the economy, and ultimately, banks. Let’s hope DeMarco succeeds in moving his plan forward despite Team Obama. If nothing else, this idea demonstrates that more can be done than is being done.

I HAVE TO POINT OUT THAT WHEN CONGRESS DECIDES THE PRESIDENT IS SLUFFING OFF HIS DUTIES, AND TAKES ACTION ON ITS OWN INITIATIVE, THE COUNTRY PROSPERS. CONGRESS SHOULD BE DOING THAT A LOT MORE. THE IMPERIAL PRESIDENCY IS A RECENT AND UNWELCOME, UNHEALTHY DEVELOPMENT.
 

Demeter

(85,373 posts)
57. Obama and Geithner: Government, Enron-Style
Wed Dec 21, 2011, 10:34 AM
Dec 2011
http://www.rollingstone.com/politics/blogs/taibblog/obama-and-geithner-government-enron-style-20111220?utm_source=dailynewsletter&utm_medium=email&utm_campaign=newsletter

...The notion that what Wall Street firms did was merely unethical and not illegal is not just mistaken but preposterous: most everyone who works in the financial services industry understands that fraud right now is not just pervasive but epidemic, with many of the biggest banks committing entire departments to the routine commission of fraud and perjury – every single one of the major banks, for instance, devotes significant manpower to robosigning affidavits for foreclosures and credit card judgments, acts which are openly and inarguably criminal...Banks and hedge funds routinely withhold derogatory information about the instruments they sell, they routinely trade on insider information or ahead of their own clients’ orders, and corrupt accounting is so rampant now that industry analysts have begun to figure in estimated levels of fraud in their examinations of the public disclosures of major financial companies.

Beyond that, as Jeff points out, Obama is simply not telling the truth about the supposedly insufficient penalties available to regulators. Employing the famous "mistakes were made" use of the passive tense, Obama copped out in his December 6 speech by saying that “penalties are too weak." As Jeff points out, what Obama should have said is that "the penalties my own regulators chose to dish out were too weak"...What makes Obama’s statements so dangerous is that they suggest an ongoing strategy of covering up the Wall Street crimewave. There is ample evidence out there that the Obama administration has eased up on prosecutions of Wall Street as part of a conscious strategy to prevent a collapse of confidence in our financial system, with the expected 50-state foreclosure settlement being the landmark effort in the cover-up, intended mainly to bury a generation of fraud...


In other words, Geithner and Obama are behaving like Lehman executives before the crash of Lehman, not disclosing the full extent of the internal problem in order to keep investors from fleeing and creditors from calling in their chits. It’s worth noting that this kind of behavior – knowingly hiding the derogatory truth from the outside world in order to prevent a run on the bank – is, itself, fraud! This is exactly the mindset that led Lehman to the abuses of the "Repo 105" accounting trick, in which loans were disguised as revenues in order to prevent the outside world from knowing the dire state of the bank’s balance sheet...Now Obama and Geithner are engaged in the same sort of activity, only they’re trying to prevent a run not on an individual bank, but the entire American financial services sector. Geithner seems really to believe that if fraud were aggressively policed, and the world made aware of the incredible extent of the illegality in our markets, that international confidence in the American financial sector would plummet and our economy would suffer – and suffer, incidentally, on Barack Obama’s watch.

Better, apparently, the Band-Aid the problem now, and let the real mess happen later on, on someone else’s watch, or at least in a second term, when there’s no need to worry about re-election. Of course, this is exactly the wrong way to go about things. If Geithner and Obama really wanted to convince the world that America’s markets weren’t broken, they would effectively police fraud, and by extension prove to everybody that at the very least, our regulatory system is not broken. But by taking a dive on fraud, and orchestrating mass cover-ups like the coming foreclosure settlement fiasco, what they’re doing instead is signaling to the world that not only are our financial markets corrupt, but our government is broken as well. The problem with companies like Lehman and Enron is that their executives always think they can paper over illegalities by committing more crimes, when in fact all they’re usually doing is snowballing the problem so completely out of control that there’s no longer any chance of fixing things, thereby killing the only chance for survival they ever had...This is exactly what Obama and Geithner are doing now. By continually lying about the extent of the country’s corruption problems, they’re adding fraud to fraud and raising such a great bonfire of lies that they probably won’t ever be able to fix the underlying mess.

If they looked at the world like public servants, and not like corporate executives, they’d understand that the only way out is to come clean. That they don’t look at things that way should tell people quite a lot.



 

Demeter

(85,373 posts)
58. Obama and the Rule of Law MUST READ
Wed Dec 21, 2011, 10:37 AM
Dec 2011
http://www.huffingtonpost.com/jeff-connaughton/obama-wall-street-laws_b_1157915.html?ref=email_share

Long silent and now contradictory, President Obama needs to deliver a clarifying speech about our financial markets and the rule of law. Speaking in Kansas on December 6, he said, "Too often, we've seen Wall Street firms violating major anti-fraud laws because the penalties are too weak and there's no price for being a repeat offender." Just five days later on 60 Minutes, he said, "Some of the least ethical behavior on Wall Street wasn't illegal." Which is it? Have there been no prosecutions because Wall Street acted legally (albeit unethically)? Or did Wall Street repeatedly violate major anti-fraud laws (and should thus find itself in the dock)?

The President is confusing "legal" with "difficult to prosecute successfully." The Justice Department's repeated decisions not to risk losing at trial against Wall Street executives don't make these person's actions legal. (If a district attorney can't prove the actual thief stole your wallet, that doesn't make stealing legal. It simply means that, regrettably, a malefactor goes unpunished.) As Securities and Exchange Commission Enforcement Director Robert Khuzami said in Senate testimony in 2009, Wall Street perpetrators "are smart people who understand that they are crossing the line" and "are plotting their defense at the same time they're committing their crime."

Moreover, the President is misleading us when he says that Wall Street firms violate anti-fraud law because the penalties are too weak. Repeat financial fraudsters don't pay relatively paltry -- and therefore painless -- penalties because of statutory caps on such penalties. Rather, regulatory officials, appointed by Obama, negotiated these comparatively trifling fines. This week, the F.D.I.C. settled a suit against Washington Mutual officials for just $64 million, an amount that will be covered mostly by insurance policies WaMu took out on behalf of executives, who themselves will pay just $400,000. And recently a federal judge rejected the S.E.C.'s latest settlement with Citigroup, an action even the Wall Street Journal called "a rebuke of the cozy relationship between regulators and the regulated that too often leaves justice as an orphan."

The Obama Justice Department hasn't tried a single Wall Street executive in a criminal court. Against a handful, it decided to let the S.E.C. bring civil charges of fraud, which are easier to prove. So if defendants' wrists are merely being slapped by the S.E.C. instead of cuffed by the Justice Department, Obama has only his appointees to blame. For three important reasons, the President needs to explain why the Justice Department has filed away its investigations of big banks and Wall Street firms without indicting anyone. First, American confidence in the system is deeply shaken. Second, it strains credulity for millions of Americans -- and has impelled thousands of them to occupy public places in protest -- that no banking or insurance executive deserves criminal prosecution for the actions that brought on the financial crisis. Third, by failing to prosecute a single high-profile Wall Street actor today, the Administration is failing to deter financial fraud tomorrow....

**************************************************************

Jeff Connaughton is the former chief of staff to former U.S. Senator Ted Kaufman (D-DE), who chaired two Senate Judiciary Committee oversight hearings on financial fraud prosecutions in 2009 and 2010.
 

Demeter

(85,373 posts)
59. Down 31 pts at open
Wed Dec 21, 2011, 10:38 AM
Dec 2011

Correction taking place...if they let it.

And now that the Market is off, so, too, must I be on my way...have a good one, or at least, keep breathing.

 

Demeter

(85,373 posts)
92. Nope! No Correction for Xmas
Wed Dec 21, 2011, 07:52 PM
Dec 2011

No coal in the banksters' stockings...just Diamonds. Or is that...Dimons?

xchrom

(108,903 posts)
63. New forces are driving the world economic order
Wed Dec 21, 2011, 10:49 AM
Dec 2011
http://www.guardian.co.uk/business/economics-blog/2011/dec/21/new-forces-world-economic-order

A new economic order is taking shape before our eyes, and it is one that includes accelerated convergence between the old western powers and the emerging world's major new players. But the forces driving this convergence have little to do with what generations of economists envisaged when they pointed out the inadequacy of the old order; and these forces' implications may be equally unsettling.

For decades, many people lamented the extent to which the west dominated the global economic system. From the governance of multilateral organisations to the design of financial services, the global infrastructure was seen as favouring western interests. While there was much talk of reform, western countries repeatedly countered serious efforts that would result in meaningful erosion of their entitlements.

On the few occasions that such resistance was seemingly overcome, the outcome was gradual and timid change. Consequently, many emerging-market economies lost confidence in the "pooled insurance" that the global system supposedly put at their disposal, especially at times of great need.

This change in sentiment was catalysed by the financial crises in Asia, Eastern Europe, and Latin America in the late 1990s and early 2000s, and by what many in these regions regarded as the west's inadequate and poorly designed responses. With their trust in bilateral assistance and multilateral institutions such as the International Monetary Fund shaken, emerging-market economies – led by those in Asia – embarked on a sustained drive toward greater financial self-reliance.
 

FarCenter

(19,429 posts)
72. Interesting blog post by Mohamed el-Erian
Wed Dec 21, 2011, 11:37 AM
Dec 2011

The emerging market economies generally have a higher degree of government regulation and direction of their financial institutions.

It looks like the Eurozone is moving in that direction.

xchrom

(108,903 posts)
73. i would say the eu is nailing down the procedures for moving wealth to the already wealthy.
Wed Dec 21, 2011, 11:50 AM
Dec 2011

they are thoroughly under the influence of austrian economic policies.

tighten up banking policies in the wrong way and lending moves to hedge funds, etc.
not good.

 

FarCenter

(19,429 posts)
90. The Germans in particular are in the ordoliberalism school, which rejects Hayek and the Austrians
Wed Dec 21, 2011, 06:59 PM
Dec 2011

Ordoliberalism is neither Keynsian nor Austrian nor socialist.

"A central tenet of ordo-liberalism is a clearly defined division of labor in economic management, with specific responsibilities assigned to particular institutions. Monetary policy should be the responsibility of a central bank committed to monetary stability and low inflation, and insulated from political pressure by independent status. Fiscal policy—balancing tax revenue against government expenditure—is the domain of the government, whilst macro-economic policy is the preserve of employers and trade unions."

xchrom

(108,903 posts)
91. Except that's not exactly the way it's working, if youre
Wed Dec 21, 2011, 07:43 PM
Dec 2011

Not German, is it?

It's still extraction economics in the PIIGS.

& if you've paid attention to SMW - you'd know Germany is starting to bear closer scrutiny for their 'miracle'.

'ordo' or 'neo' liberalism isn't working except for Magick believers.

 

Ghost Dog

(16,881 posts)
75. Moody's downgrades Egypt, on review for further action
Wed Dec 21, 2011, 12:42 PM
Dec 2011

Moody's Investors Service on Wednesday downgraded Egypt's government bond ratings by one notch to B2 from B1 and also placed the rating on review for further possible downgrade.

It said the move was in response to Egypt's ongoing unsettled political situation, "which continues to undermine investor confidence".

It also noted the deterioration in the country's external balance-of-payments position, which it said was exacerbated by the continued loss of official foreign exchange reserves and which "raises the risk of a balance-of-payments crisis".

The rating agency added that it was concerned about the absence of a meaningful level of exceptional, external financial support to help restore confidence in the transitional period ahead of a return to civilian rule.

/... http://www.arabianbusiness.com/moody-s-downgrades-egypt-on-review-for-further-action-436410.html

Case in point.

xchrom

(108,903 posts)
76. and i was just wondering to myself about egypt today.
Wed Dec 21, 2011, 12:49 PM
Dec 2011

i think down grading countries has become a new money making sport.

xchrom

(108,903 posts)
65. Banking: the gift that keeps on giving – just not to you
Wed Dec 21, 2011, 10:53 AM
Dec 2011
http://www.guardian.co.uk/business/economics-blog/2011/dec/20/banking-gift-keeps-giving

Christmas came early this year for four former executives of Washington Mutual (WaMu), a large US bank that failed in the autumn of 2008. The Federal Deposit Insurance Corporation (FDIC) had brought a lawsuit against the four for actions that included taking huge financial risks while "knowing that the real estate market was in a 'bubble'". The FDIC sought to recover $900m (£575m), but the executives have just settled for $64m, almost all of which will be paid by their insurers; their out-of-pockets costs are estimated at just $400,000.

To be sure, the executives lost their jobs and now must drop claims for additional compensation. But, according to the FDIC, the four still earned more than $95m from January 2005 through September 2008. So they are walking away with a great deal of cash. This is what happens when financial executives are compensated for "return on equity" unadjusted for risk. The executives get the upside when things go well; when the downside risks materialise, they lose nothing (or close to it).

At the same time, their actions – and similar actions by other bankers – are directly responsible for both the run-up in housing prices and the damaging collapse that followed. That collapse has impacted non-bankers in many negative ways, including through the loss of more than 8 million jobs.

It is also leading to austerity – taxes are increasing and government spending is falling at the local and state level around the country. A difficult fiscal conversation still lies ahead at the federal level, but cuts and contractions of various types seem likely.

xchrom

(108,903 posts)
66. Fleeing Greeks bank on new Australian gold rush
Wed Dec 21, 2011, 10:54 AM
Dec 2011
http://www.guardian.co.uk/world/2011/dec/21/fleeing-greeks-australian-gold-rush

For several months a stream of mostly young men and women, fresh off the plane from Greece, has been knocking at the doors of a large building on Lonsdale Street in the heart of Melbourne. The 1940s block houses the headquarters of Australia's biggest Greek community. In scenes reminiscent of the great gold rush at the turn of the 20th century, the men and women have travelled to the other side of the world in search of a better life. Unlike Greeks of old, however, these new émigrés are noticeably accomplished, with hard-earned degrees won in some of the toughest fields.

"They're all university graduates, engineers, architects, mechanics, teachers, bankers who will do anything for work," says Bill Papastergiades, the community's lawyer president. "It's desperate stuff. We're all aghast. Often they'll just turn up with a bag. Their stories are heartbreaking and on every plane there are more," he told the Guardian in a telephone interview. "A lot come here and are literally lost. We've taken to putting them in houses, five or six of them at a time, here in the centre."

The exodus is just one part of the human drama being played out in Greece where Europe's debt crisis began. Since June, Melbourne community leaders say they have been deluged with thousands of letters, emails and telephone calls from Greeks desperate to migrate to a country that, safeguarded from global market turbulence, is now seen as the land of unparalleled opportunity.

This year alone, 2,500 Greek citizens have moved to Australia although officials in Athens say another 40,000 have also "expressed interest" in initiating the arduous process to settle there. An 800-seat Australian government "skills expo" held in the Greek capital in October attracted some 13,000 applicants.
 

Demeter

(85,373 posts)
68. Do you think this is intentional policy, or just desperation?
Wed Dec 21, 2011, 11:22 AM
Dec 2011

Why do they not look closer to home?

I wish there was more detail...

xchrom

(108,903 posts)
69. anything i would say would be uninformed opinion -- but
Wed Dec 21, 2011, 11:29 AM
Dec 2011

this isn't the first article i've read about people leaving the PIIGS.

first it was ireland -- then portugal -- we know germany has courted skilled spanish workers -- and now this.

i think it's a result of austerity measures.

depopulating a tax base leaves nations open to foreign buying.
also makes it harder to pay back those loans -- those people aren't paying taxes at home, after all.

i wouldn't say it's entirely unintentional -- i think we should be suspicious after all we've been through.

xchrom

(108,903 posts)
67. ECB loans highlight funding pressure on eurozone banks
Wed Dec 21, 2011, 11:12 AM
Dec 2011
http://www.guardian.co.uk/business/economics-blog/2011/dec/21/ecb-loans-european-banks-eurozone

The strains on the European financial system were exposedon Wednesday when more than 500 banks borrowed almost €500bn (£417bn) in cheap three-year loans from the European Central Bank (ECB).

City analysts said the heavier-than-expected take-up reflected the funding pressures on institutions heavily exposed to the sovereign debt crisis in the eurozone.

Small gains in stock markets immediately after the ECB announced the details of its long-term refinancing operation (LTRO) were quickly wiped out and bond yields on Italian and Spanish debt rose.

Although the Frankfurt-based ECB has been resisting calls for it to join the Bank of England and the Federal Reserve in printing electronic money, it sees the LTRO as a means of boosting and providing them with the resources to buy the bonds in the troubled peripheral regions of monetary union.
 

Ghost Dog

(16,881 posts)
85. Italian, Spanish bonds yields jump after ECB tender
Wed Dec 21, 2011, 03:31 PM
Dec 2011

LONDON, Dec 21 (Reuters) - Italian and Spanish government bond yields rose on Wednesday after doubts emerged on whether banks would use much of the hefty three-year loans they took from the European Central Bank to buy Italian and Spanish debt.

Yields had fallen for eight sessions in thin trade driven by short-term players, who booked their profits on Wednesday soon after the ECB said it lent banks 489 billion euros, much more than the 310 billion expected.

The profit-taking spree took Italian yields close to the psychologically important 7 percent level again, prompting the ECB to buy Italian debt in secondary markets, traders said.

... Italian 10-year bond yields were 16 basis points higher at 6.79 percent, compared to 6.92 percent before traders cited ECB forays, but sharply higher from session lows of just below 6.5 percent. Spanish yields were 18 bps higher at 5.31 percent, having fallen almost 100 bps in the past 10 days...

... "It's going to be an eventful January for sure, we have to face up to a heavy supply and it really depends on which side of the bed the market wakes up on on January 4," said David Keeble, global head of fixed income strategy at Credit Agricole.

/... http://www.reuters.com/article/2011/12/21/markets-bonds-euro-idUSL6E7NL4KP20111221?rpc=401

xchrom

(108,903 posts)
74. Backlash from Beijing raises fears that China's economy is slowing down
Wed Dec 21, 2011, 11:57 AM
Dec 2011
http://www.guardian.co.uk/world/2011/dec/18/backlash-beijing-fears-of-chinese-slowdown

While Europe's leaders were wrestling with the problem of who will bail out whom last week, the world's other two major trading blocs, the US and China, were gearing up for a potentially damaging trade war.

As China slapped punitive import taxes on gas-guzzling American cars, and stepped up its rhetoric against the US, complaining about what it said were US subsidies, some Beijing-watchers read it as a sign that the government is so alarmed about a looming economic slowdown that it is casting around for someone to blame.

The tariffs, ranging from 2% to 21.5%, will be levied on imports of SUVs and cars with engines of 2.5 litres or more, hitting the US car giants.

It's not hard to see why China is lashing out. Evidence is mounting that just a few months after Beijing was fretting about its economy overheating and taking action to tame rampant food prices, the most pressing concern now is a so-called hard landing.

xchrom

(108,903 posts)
81. Economy sees first signs of nasty drop {japan}
Wed Dec 21, 2011, 01:20 PM
Dec 2011
http://www.japantimes.co.jp/text/nb20111221a3.html

TOYOTA, Aichi Pref. — Kiyohito Okuda is a businessman and an optimist, and so he has found at least one redeeming angle to Japan's slow-motion economic decline: Never has the pain felt too acute to bear.

After years of shrinking sales and curtailed ambitions, he can still handle a little more bad news. When Toyota Motor Corp. recently urged its suppliers — Okuda's auto parts manufacturing company among them — to cut prices 3 percent, Okuda said OK.

Indeed, the request sounded fair. Okuda's profits will wither, but he won't need to take out loans, he said, and he won't lay off any of his 130 workers. The company will still throw its end-of-the-year drinking party.

For two decades now, Japan has managed to endure the economic downturn largely because the slope felt so gentle. But in recent months, with the record-strong yen cutting sales and profits of major exporters, the world's third-largest economy is seeing the first signs of a nastier drop.
 

jtuck004

(15,882 posts)
83. Cartoon. I looked up the motel 6 in Riverside, $49.99 a night, vs $142 at the jail. 2 meals, though
Wed Dec 21, 2011, 01:45 PM
Dec 2011


(minus the continental breakfast) shouldn't cost that much more. Maybe it's for security...

Special Internet Rate $47.49 USD
Standard Rate $49.99 USD

Thank you for your work H., and all those who work on this. I hope your holidays bring you peace.

tclambert

(11,080 posts)
88. Does Motel 6 have guards?
Wed Dec 21, 2011, 06:18 PM
Dec 2011

Prison doesn't have illegal immigrant maids, but it does have trustees and other inmates doing some of those jobs, like laundry and meal prep, for almost as much as illegal immigrants make.

Meal prep at a for profit prison: "Boil that and serve it as soup!" "But that's a rock! I mean, Yes Boss! Right away, Boss."

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