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Thread: News dump

  1. #1
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    Default News dump

    First the news from (There's no "Bull" smilie)

    July 2 (Bloomberg) -- The euro may be nearing an ``explosive breakout,'' reaching record levels against the U.S. dollar, according to a Citigroup Global Markets Inc. research note.
    http://www.bloomberg.com/apps/news?p...VM&refer=home#

    WASHINGTON, July 2 (Xinhua) -- World Bank President Robert B. Zoellick has called on leaders of the G8 as well as the major oil producers to act now to deal with surging food and energy prices, warning that the world is now "entering a danger zone."
    http://news.xinhuanet.com/english/20...nt_8478565.htm

    Why don't we just take the oil? We've invested it liberating a country. I can have the problem solved of gas prices coming down in ten days, not ten years."There were a couple of problems with Doyle's plan, of course. The first was that he was describing the biggest stickup in world history. The second, that he was too late: "We" are already heisting Iraq's oil, or at least are on the cusp of doing so.
    http://www.commondreams.org/archive/2008/07/03/10085/

    In an unpublished report, the World Bank concludes that 75% of the increase in food prices is the result of biofuel mandates.
    http://technocrat.net/d/2008/7/4/45106


    And now your friendly

    Morgan Stanley, hammered by credit crunch losses, plans to sell half its remaining stake in MSCI, the portfolio analytics and equity indices company, for about $850m.
    http://boombustblog.com/component/op...tml/Itemid,20/

    Almost everything that could is going wrong for world stockmarkets
    http://www.economist.com/finance/dis...ry_id=11670925

    Toronto-Dominion Bank has disclosed a $96-million loss caused by "incorrectly priced financial instruments" at the TD Securities office in London.
    http://www.globeinvestor.com/servlet.../GIStory/Email


    And from the Well-that-worked-well-didn't-it Department :
    NEW YORK, July 3 (Reuters) - The Federal Reserve's portfolio of Bear Stearns assets has lost more than $1 billion of its original value, a sign that credit market conditions have worsened in recent months.
    http://uk.reuters.com/article/email/...080703?sp=true
    Once again, the conservative, sandwich-heavy portfolio pays off for the hungry investor
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    Default Re: News dump

    bottom line appears to be that the ECB is serious about curbing EuroLand inflation (even if it means causing a recession in Spain, Italy etc.), while the USA is serious about printing ever more green paper in order to 'devalue' existing individual and corporate debts (and thus avoid a slew of bankruptcy filings).

    However, the unavoidable side effect will continue to be rising prices for world commodities like oil / food / base metals / precious metals in US dollar terms. Ironically, the Euro denominated prices of these world commodities is likely to stay the same, or even decline due to reduced demand for these world commodities from other parts of the world.

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    Default Re: News dump

    Quote Originally Posted by Melonie View Post
    bottom line appears to be that the ECB is serious about curbing EuroLand inflation (even if it means causing a recession in Spain, Italy etc.), while the USA is serious about printing ever more green paper in order to 'devalue' existing individual and corporate debts (and thus avoid a slew of bankruptcy filings).
    I think I joked in an earlier thread that this smells like the US shorting their own currency "Let me buy all this stuff by giving you USD IOUs. Oh dear - now the USD is worthless so I owe you much less ". Whatever the motivation, the end result seems to be similar.

    Theodore J. Forstmann
    The Credit Crisis Is Going to Get Worse
    http://online.wsj.com/article/SB1215...n_commentaries

    The United Arab Emirates has cancelled the entire debt owed to it by Iraq - a sum of almost $7bn (£3.5bn) including interest and arrears.
    http://news.bbc.co.uk/2/hi/middle_east/7492115.stm
    Once again, the conservative, sandwich-heavy portfolio pays off for the hungry investor
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    Default Re: News dump

    ^^^ Forstmann's article goes right to the heart of the matter IMHO ..

    (snip)"One such aside is about Warren Buffett and the rule of the three "I"s.

    "Buffett once told me there are three 'I's in every cycle. The 'innovator,' that's the first 'I.' After the innovator comes the 'imitator.' And after the imitator in the cycle comes the idiot. Which makes way for an innovator again." So when Mr. Forstmann says we're at the end of an era, it's another way of saying that he's afraid that the idiots have made their entrance.

    "We're in the third 'I' for sure," he interjects an hour after first introducing the "rule." "And that always leads to something. Innovators don't just show up. Some disaster takes place because of the idiots, and then an innovator says, oh, look at this, I can do this, that or the other thing." That disaster is now.

    In other words, "In order to fix what's going on in the United States there's going to have to be a certain amount of pain. The market's going to have to clear somehow. . . and it's hard for me to believe that it gets fixed without" upheaval in the financial system, the economy and the country as a whole. "Things are going to fail. Enterprises are going to fail. The economy is going to slow," he warns.

    To be clear, although Mr. Forstmann talks about "fear and greed" getting out of whack, his is not a condemnation of "greedy speculators" or a "culture of greed" or any of the lamentations so popular among the populists in Washington. It is a diagnosis of the ways in which the financial sector responded to a government policy of printing money that was free, or nearly so. "The creation of much too much money caused all of this excess," he says. In other words, his is not an argument for draconian regulation, but for sound money.

    Nor does he blame Alan Greenspan, even though he argues that this all started with the dot-com bubble and 9/11. "Greenspan," he allows, "had really tough decisions to make, so I don't think it's a black-and-white kind of thing at all." It was, and is, rather, "a case of first impression." Mr. Greenspan, he says, admits that he was "totally sure" that what he was doing was right. But he had "no idea what the consequences [were] going to be."

    According to Mr. Forstmann, we are now living with those consequences. And the correction has only begun."(snip)

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