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Monthly Archives: June 2012

RIM is Contemplating Splitting the Company in Two

“BlackBerry maker Research in Motion is considering splitting its business in two, separating its struggling handset manufacturing division from its messaging network, The Sunday Times reported.”

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Do Not Expect Tax Receipts to Help Out Greece

“Greece  is struggling to cope with a collapse in corporate tax receipts, according to the latest figures from the Greek finance ministry.

The steep fall in corporation tax income – from €737m (£590m) between January and May 2011 to €448m in the same period this year – is likely to weigh heavily on the new coalition government as it prepares for a European summit later this week.

Without the ability to tax company profits, the government will be forced to step up its demands on households for tax income at a time when most families are already suffering cuts in wages and falling living standards.

The figures will also undermine the message from Greek leaders that the new government is capable of arresting the country’s decline and paying the interest on a new tranche of debt funding from Brussels.”

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Gapping Up and Down This Morning

Gapping up 

LXRX +8.9%, TEVA +7.9%, SNDK +1.8% ,  NVDA +0.4%,  BA +0.1%, RMBS +0.9%,

STZ +1.2% ,  BUD +1%, WPI +1.7% ,  NPSP +2.3%,

Gapping down

CEL -5.1%, NOK -5%, BBVA -4.3%, DB -4%, ING -3.9%, FTE -2.8%, TOT -2.3%,

CS -2.1%, BBL -2%, STO -1.7%, RIO -1.6%, E -1.4%, ABB -1.3%, RIMM -1.2%, SD -1%

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America’s Economy Really Is Screwed Up, And The Problem Is Corruption

“Over the past few days, Henry Blodget at Business Insider posted a number of graphs, here and here, which depict something about the US economy that everybody knows to some extent or another, but that most of us won’t have let thoroughly sink in. For some because the consequences are too opaque, for others because they are too scary. But make no mistake: we can only continue to ignore or misinterpret them at our own peril. And even then it’s terribly late in the game.

The essence of Blodget’s argument is this: ”

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BRIC Economies Experience Huge Currency Drops; More Expected to Come

“The largest emerging markets, whose economies grew more than four-fold in the past decade, are making losers out of everyone from central bankers to Procter & Gamble Co. (PG) as their currencies post the biggest declines since at least 1998.

For the first time in 13 years, the real, ruble and rupee are weakening the most among developing-nation currencies, while the yuan has depreciated more than in any other period since its 1994 devaluation. P&G, the world’s largest consumer-goods maker, cut its profitforecast for the second time in two months last week in part because of currency losses. Brazil’s Fibria Celulose SA (FIBR3), the biggest pulp producer, asked banks to loosen restrictions on dollar loans as the real hit a three-year low.”

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U.S. Banks Aren’t Nearly Ready for Coming European Crisis

“The euro area faces a major economic crisis, most likely a series of rolling, country-specific problems involving some combination of failing banks and sovereigns that can’t pay their debts in full.

This will culminate in systemwide stress, emergency liquidity loans from the European Central Bank and politicians from all the countries involved increasingly at one another’s throats.”

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Ben Davies: Gold Is Worth $6,000

“Ben Davies, CEO of Hinde Capital, spoke to King World News yesterday giving his thoughts on where gold is headed next. He is somewhat bearish, saying gold could fall over 10 percent to around $1400 per ounce as Europe continues to muddle through its crisis.

Davies told King World News:

If you look at it on a relative basis, gold has maintained its purchasing power. It’s done exactly what it should be doing. Short-term I am concerned that we could be going down to $1,400. Yes, that’s a real risk in this environment…”

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