Corn Rises For the Fifth Consecutive Day; Longest Rally Since December

“Corn rose for a fifth day in Chicago, the longest streak since December, as wet weather delays sowing from North Dakota toOhio. Wheat gained for a third day as a lack of rain in growing countries hurts yields.

About 63 percent of the U.S. corn crop was sown as of May 15, behind the five-year average of 75 percent, the Department of Agriculture said May 16. April was the second-hottest since 1900 in France, Europe’s biggest wheat grower, and England’s warmest in 352 years, curbing yields along with dry weather inChina and Germany.”

Full article

“Investment spending in emerging markets is outpacing expenditures in developed economies for the first time, as a surge in infrastructure supports global growth and profits at companies from Siemens AG (SIE) to Caterpillar Inc. (CAT)

The “biggest investment boom of recent decades” will help boost expansion worldwide about 4 percent this year and next, compared with a long-run average of just below 3 percent, according to Michael Saunders, Citigroup Inc.’s chief European economist. International Monetary Fund data show investment will top 24 percent of global gross domestic product in 2012, the most in more than two decades, and then rise above 25 percent, the highest since records began 30 years ago.

Saunders calculates that developing nations will probably secure the largest share of it this year. That’s showing up in the bottom line of Siemens, Europe’s largest engineering company. The Munich-based business predicts profits will rise about 75 percent to at least 7.5 billion euros ($10.6 billion) in the year ending Sept. 30.”

Full article

“European stocks climbed for the first time in five days, rebounding from a four-week low, as base metals and oil led gains in commodities. Asian shares and U.S. index futures advanced.

The Stoxx Europe 600 Index gained 0.6 percent to 278.94 at 8:02 a.m. in London.

To contact the editor responsible for this story: Andrew Rummer at [email protected]”

Full article

“Asian stocks rose, driving a regional benchmark index higher for the first time in five days, amid improved earnings and merger-and-acquisition speculation. Tokyo Electric Power Co. gained after it presented a plan for stabilizing a stricken nuclear-power plant.

Fairfax Media Ltd. (FXJ) surged 4.3 percent in Sydney after reports Lachlan Murdoch, son of News Corp. Chief Rupert Murdoch, is mulling a bid for its radio unit. Austar United Communications Ltd. (AUN) added 6.1 percent on speculation Foxtel is in advanced talks over a potential takeover. Mizuho Financial Group Inc. (8411) gained 3.2 percent in Tokyo after the Nikkei newspaper said it plans to merge its retail and corporate banks. Tokyo Electric rose 2.4 percent as it confirmed plans to cool damaged reactors as early as October

“Increasing corporate activity reflects the fact that companies’ balance sheets are well capitalized and funding has become more freely available,” said Matt Riordan, who helps manage close to $7 billion in Sydney at Paradice Investment Management Pty. “Corporate activity is positive as it underwrites the share prices of the potential targets.”

Full article

“The dollar fell against the euro for a third day on speculation the Federal Reserve will trail the European Central Bank in tightening monetary policy.

The Dollar Index dropped before the U.S. central bank today releases minutes from its April 26-27 meeting after which Chairman Ben S. Bernanke signaled the economy still requires monetary support. The euro was supported by prospects the ECB will raise interest rates even as the region’s debt crisis persists. New Zealand’s dollar advanced for a second day versus the greenback after a report showed producer prices rose in the first quarter.

“We don’t hear any talk about rate increases in the U.S., while such expectations are supporting the euro,” said Tsutomu Soma, a bond and currency dealer at Okasan Securities Co. in Tokyo. “The Fed is printing dollars aggressively, but we have yet to see inflation concerns rise. That means the U.S. is far away from exiting stimulus measures.”

Full article

“Crude oil and gold will lead a rally in commodities as production fails to keep pace with demand, said Ray Eyles, chief executive officer of JPMorgan Chase & Co. (JPM)’s commodity business in Asia.

Oil supply will trail consumption in the second half as the Organization of Petroleum Exporting Countries and other producers won’t increase output fast enough, the bank said in a report May 6. Rabobank Groep expects shortages in corn and cotton this year while Barclays Capital is predicting deficits in copper, nickel, tin, lead and platinum.

“Ultimately, the long-term fundamental supply and demand of commodities is still pointing to higher prices,” Eyles said in an interview. “The commodities that have the best underlying fundamental stories at the moment” are in energy because of unrest in the Middle East and Japan’s nuclear crisis, he said.”

Full article

“U.K. unemployment claims rose in April at the fastest pace since January 2010, underlining the fragility of the economic recovery as government spending cuts and accelerating inflation sap consumer confidence.

Jobless benefit claims increased by 12,400 from March to 1.47 million, the Office for National Statistics said today in London. The median forecast of 24 economists in a Bloomberg News Survey was for no change. Unemployment measured by International Labour Organization methods fell 36,000 to 2.46 million people in the quarter through March.”

Full article

“China’s home prices rose in 67 of 70 cities monitored by the government in April from last year, led by smaller cities that are defying efforts to control property prices nationwide.

Housing prices increased at a faster pace in smaller cities and slowed in major ones, data posted on the statistics bureau’s website today showed. New home prices in Urumqi, capital of far western Xinjiang province, posted the biggest gain, up 9.3 percent last month from a year earlier, while prices in northern Mu Danjiang climbed 8.7 percent. In the capital Beijing, prices rose 2.8 percent in April, compared with 4.9 percent in March, while those in Shanghai slowed to a 1.3 percent gain.”

Full article

“Australian consumer confidence declined in May to the lowest level in almost a year after the government announced a budget that will end 23 years of inflation-adjusted spending growth.

The sentiment index fell 1.3 percent to 103.9 from a month earlier, according to a Westpac Banking Corp. (WBC) and Melbourne Institute survey of 1,200 consumers taken May 9-15 and released today in Sydney.

Reserve Bank of Australia Governor Glenn Stevens this month held the overnight cash rate target at 4.75 percent, after seven increases from October 2009 to November last year that helped spur the currency to a record. Reports this month showed retail sales stagnated in the first quarter and employment dropped in April by the most since 2009, while the RBA said higher rates will likely be needed “at some point” to contain inflation.”

Full article

“European Central Bank officials ruled out a Greek debt restructuring, clashing with political leaders over a solution to the sovereign financial crisis.

“A Greek debt restructuring is not the appropriate way forward — it would create a catastrophe” because it would damage the banking system, ECB Executive Board member Juergen Stark said today in Lagonissi, Greece. Fellow board member Lorenzo Bini Smaghi said in Milan that “a solution for reducing debt but not paying for it will not work.”

European Union finance ministers for the first time this week floated the idea of extending Greece’s debt-repayment schedule as the nation struggles to meet the terms of last year’s 110 billion-euro ($156 billion) rescue. EU officials say that Greece won’t be able to return to markets and sell 27 billion euros of bonds next year as scheduled under the bailout, leaving them searching for alternatives to avoid a default.”

Full article

_______________

“I love Asia. It’s China’s turn to rule the roost. America is washed up, so I packed up and left. Let me give you some advice, sweetie, you’ll want to stick with a smart man like myself instead of Dr. Bernanke. The only impressive endowment that idiot is associated with is all of the free money that rolls into his alma mater, Princeton. I, on the other hand, am very well-equipped with my own my set of natural resources and commodities. Don’t forget: Buy commodities and they will go up in a bad economy as well as a good one. A can’t miss get rich plan if I ever saw one…Hey…hey…are you listening to what I’m saying? What’s your name again?” -Jim Rogers, CEO of The Bowtie Diaries

We could definitely use another Abraham Lincoln to emancipate us all from being slaves to words.

In the midst of a historic financial crisis of unprecedented government spending, and a national debt that outstrips even the debt accumulated by the reckless government spending of the previous administration, we are still enthralled by words and ignoring realities.

President Barack Obama’s constant talk about “millionaires and billionaires” needing to pay higher taxes would be a bad joke if the consequences were not so serious. Even if the income tax rate were raised to 100% on millionaires and billionaires, it would still not cover the trillions of dollars the government is spending.

More fundamentally, tax rates — whatever they are — are just words on paper. Only the hard cash that comes in can cover government spending. History has shown repeatedly, under administrations of both political parties, that there is no automatic correlation between tax rates and tax revenues.

Tax Rates Vs. Hard Cash

When the tax rate on the highest incomes was 73% in 1921, that brought in less tax revenue than after the tax rate was cut to 24% in 1925. Why? Because high tax rates that people don’t actually pay do not bring in as much hard cash as lower tax rates that they do pay. That’s not rocket science.

Then and now, people with the highest incomes have had the greatest flexibility as to where they will put their money. Buying tax-exempt bonds is just one of the many ways that “millionaires and billionaires” avoid paying hard cash to the government, no matter how high the tax rates go.

Most working people don’t have the same options. Their taxes have been taken out of their paychecks before they get them.

Even more so today than in the 1920s, billions of dollars can be sent overseas electronically, almost instantaneously, to be invested in other countries — creating jobs there, while millions of Americans are unemployed. That is a very high price to pay for class warfare rhetoric about taxing “millionaires and billionaires.”

Nothing New

Make no mistake about it, that kind of rhetoric wins votes for political demagogues — and votes are their bottom line. But that is totally different from saying that it will bring in more tax revenue to the government.

Time and again, at both state and federal levels, in the country and in other countries, tax rates and tax revenue have moved in opposite directions many times. After Maryland raised its tax rates on people making a million dollars a year, there were fewer such people living in Maryland — and less tax revenue was collected from them.

Read the rest here.

“The news media in this country are in a stupor. Either out of ignorance, or complete leftist bias and fraud to protect their socialist hero Barack Obama, the mainstream media has turned a blind eye toward the enormous disaster facing our economy. The greatest Ponzi scheme in world history is coming to an end, leaving America on the precipice of economic Armageddon. Here are the facts the mainstream media does not want you to see- hiding in plain site just like Osama bin Laden was.”

Read the rest here.

Consumer revenue down 7%

Gross margins were good

Guidance was 2-3% better than normal

Full report

“They weren’t murderers or anything; they had merely stolen more money than most people can rationally conceive of, from their own customers, in a few blinks of an eye. But then they went one step further. They came to Washington, took an oath before Congress, and lied about it.

Thanks to an extraordinary investigative effort by a Senate subcommittee that unilaterally decided to take up the burden the criminal justice system has repeatedly refused to shoulder, we now know exactly what Goldman Sachs executives like Lloyd Blankfein and Daniel Sparks lied about. We know exactly how they and other top Goldman executives, including David Viniar and Thomas Montag, defrauded their clients. America has been waiting for a case to bring against Wall Street. Here it is, and the evidence has been gift-wrapped and left at the doorstep of federal prosecutors, evidence that doesn’t leave much doubt: Goldman Sachs should stand trial.”

Full article

“(Rick Bookstaber is a senior policy adviser at the SEC. This guest post represents personal opinion from his blog.)

Jeremy Grantham put out a great quarterly letter about the scarcity of commodities and the marked rise of commodity prices, calling this “the mother of all paradigm shifts”.

Two interesting points in his letter are:

1. China consumes between 25% and 50% of many important commodities.
2. Prices for nearly all commodities are two or more standard deviations above their long-term mean; four standard deviations for iron ore, coal, copper and silver.

The recent drop in commodity prices notwithstanding, this and other analysis lay down the groundwork for his concern about the end of falling commodity prices. No one can deny that, absent one hundred per cent recycling, non-renewable resources extracted from a finite world will finally run out. And, furthermore, that we are using these resources more now than we have in the past, and given the growth of China and other countries, there are major sources of consumption that were a rounding error even a few years ago.”

Full article

“LinkedIn Corp. raised its price range for an expected initial public offering this week by 30%, a strong indication that demand is running high for its shares, and an increase not seen since the dot-com bubble of a decade ago.

The company, which is set to price its shares on Wednesday night and begin trading on the New York Stock Exchange on Thursday, originally planned to sell 7.84 million shares at between $32 and $35 apiece. In a revised filing Tuesday with the Securities and Exchange Commission, the company set a new price range of between $42 and $45 a share.”

Full article

“According to Jan Hatzius, the chief U.S. economist of Wall Street’s most influential firm Goldman Sachs (GS), the next recession in the US “is years away.”

“There’s still a long way to go. The unemployment rate is still 9%, we are nowhere close to a really tight labor market that usually precipitates a recession. So I think we’re still be in a recovery for a few years,” Jan Hatzius told CNBC Tuesday.

Starts at the end of clip: 9:10”

Full article/video

“The April master trust data have been released for the six major card issuers, overall demonstrating a continuation of positive credit trends (both delinquencies and charge-offs), although overall loan balances continue to decline.

Average net charge-offs (NCOs) fell by 10 basis points on a sequential-month basis and delinquencies by 23 basis points. Importantly, total delinquencies are down an average of 188 basis points from the prior year’s period.

Altogether, NCOs have fallen to levels not seen since early 2008 and delinquencies are at levels not seen since 2007. However, as credit metrics migrate toward more “normalized” levels, concerns remain about continued contraction in overall outstanding balances.”

Full article

“Faith in global growth has plunged in recent months, with a sharp drop in the number of fund managers who believe the world’s economy will expand in the next year.

The results, contained in the latest Bank of America Merrill Lynch Fund Manager Survey, also show less confidence among institutional investors in corporate profits.

The survey found just 41 percent of managers believing the global economy will expand, while 31 percent see a pullback and the remaining 28 percent either unsure or seeing little growth. That’s a huge drop from earlier this year.

Though some 69 percent of companies in the Standard & Poor’s 500 have posted better-than-expected earnings from the first quarter, the stock market has sputtered and investor confidence appears to have waned significantly.”

Full article