“Germany’s top court said a decision on whether to suspend legislation for the euro bloc’s permanent bailout fund and fiscal treaty could take months rather than weeks due to the complexity of the ruling.”
Comments »Italy Looks to Tap Euro Zone Aid
“(Reuters) – Italy said on Tuesday it may want to tap euro zone aid to ease its borrowing costs as finance ministers struggled to convince markets they are getting a grip on the bloc’s debt crisis, which a top European Central Banker said could escalate.
Prime Minister Mario Monti, who is under intense market pressure to shape up his economy and avoid being drawn into the center of the debt crisis, said Italy could be interested in tapping the euro zone’s rescue fund for bond support.
“It would be hazardous to say that Italy would never use (this mechanism),” he said after a meeting of European finance ministers in Brussels. “Italy may be interested.”
Comments »Europe Celebrates as 100 Billion Euros Will Be Transferred Over to Spanish Banks
Euro governments will transfer 100 billion Euros onto Spanish bank balance sheets avoiding the build up of sovereign debt. Euopean equities rallied on the news.
Comments »Why the U.S. Does Not Need to Worry Over Insolvency
“The first question on the new Q&A page was:
Can you explain why you don’t think the USA is going to have a Greek style debt crisis?
Good question! This is one of those things that really confuse people because they understand how their own lives and businesses work as revenue constrained entities. But the autonomous currency issuer to household or business analogy doesn’t hold true. The reasoning is actually quite simple.”
Comments »RealClearMarkets’ Tamny: US Pursues Weak Dollar Policy at its Peril
“The Treasury and Federal Reserve are pursuing a weak dollar policy, as John Tamny, editor of RealClearMarkets.com sees it.
And the economy will continue to suffer if they don’t change course, he says.
“My view for quite some time has been that when we talk about economic problems in the U.S., we are really talking about symptoms of the weak dollar,” Tamny tells Yahoo.
“If the stated objective of your monetary policy is to devalue dollars, it is going to be true that investment is going to be less such that economic growth is less.”
Some economists say a weak currency is beneficial, because it boosts exports and curbs imports. But Tamny disagrees.
“Imports are beautiful. It is poor countries that don’t import,” he says. “If devaluation were the path to prosperity, then countries like Argentina and Zimbabwe and Turkey would be among the richest in the world.”
Comments »Wall Street Banks Decline Bernanke’s Twist, Hoard Treasurys
“Wall Street banks are increasingly choosing to hoard their U.S. bonds rather than sell them to the Federal Reserve as speculation grows that a slowing economy and global financial turmoil will only make them more dear.
The world’s biggest bond dealers offered an average of $7.2 billion in Treasuries a day to the central bank in June, down 40.5 percent from a high of $12.1 billion in October, data compiled by Bloomberg show. The amount tendered has fallen even as the dealers almost doubled their holdings of the securities.”
Comments »Small Community Banks Find a Tough Time Bridging the Loan Gap
“(Reuters) – Union County Savings Bank in Elizabeth, New Jersey, is profitable with few problem loans and a capital ratio that would make a too-big-to-fail bank drool.
The community bank is also one of the most tight-fisted lenders in the country. The bank invests just 9 percent of its $1.3 billion in deposits in loans. It pours most of the rest into an investment portfolio. That loan-to-deposit ratio puts it near the bottom of 6,000 U.S. community banks, according to a Reuters analysis.
Community banks are often seen as kinder, gentler versions of their big-bank brethren. The Occupy Wall Street movement accused big banks of being greedy and encouraged depositors to move funds to their local community banks.”
Comments »Obama Will Try for a One Year Extension of the Bush Tax Cuts
“(Reuters) – President Barack Obama will call for a one-year extension of Bush-era tax cuts for families earning less than $250,000 a year, according to a White House official, seeking to spare the economy the impact of taxes going up on January 1.
Obama, a Democrat, will make the request in a 11:50 a.m. statement at the White House on Monday.
Republicans in Congress are unlikely to be swayed, as they have consistently argued that the Bush tax cuts should be extended for everyone, including higher earners.”
Comments »Japan’s Government May Run Out of Money by October
A deficit bill is facing problems in the Japanese parliament. If not passed then Japan would run out of cash to run government. I’m sure they will agree to print some money up…..I mean sell bonds to the world.
Comments »ZIRP Policies by the ECB Cause Speculation Over QE for Europe
“The European Central Bank’s step into the world of zero interest rates is fueling speculation it may eventually be forced to follow the Federal Reserve and the Bank of England with large-scale asset purchases.
The ECB yesterday reduced its benchmark rate to a record low of 0.75 percent and took its deposit rate to zero, with President Mario Draghi saying the cuts may have only a “muted” economic impact. While deflecting questions about further measures such as quantitative easing, Draghi said “there is no feeling that we are running short of policy options” and “we still have all our artillery ready to contain inflationary risks” in either direction.”
Comments »Robot Quants Suffer Their Worst Losses Since October
Robot trading for hedge funds were just as confused as their human counter part due to circle jerk action served up by Europe….
Comments »Morgan Stanley Sees Philippine Stocks Rallying
“Philippine (PASHR) stocks, Asia’s most expensive equities, may rise a further 25 percent this year as the economy grows, according to Jonathan Garner, Morgan Stanley’s chief Asia and emerging-market strategist.
The Philippine Stock Exchange Index (PCOMP) rallied 23 percent in 2012 to a record yesterday, the world’s fifth-best performer, amid government plans to boost spending while narrowing thebudget deficit. The gauge’s valuation of 16.4 times estimated earnings is the highest of 15 Asian Pacific markets tracked by Bloomberg and is approaching the biggest premium to the MSCI Emerging Markets Index since November 2006.”
Comments »Why This Month-Old Startup Is The Most Promising To Launch In A While
Read about the the Rebelmouse startup here.
Comments »Three Keys to Greater Wealth
“There are three keys to greater wealth from investing: philosophy, strategy and discipline. The best returns go to those who have a sound investment philosophy, create a workable plan based in this belief, and diligently follow their plan. These steps sound easy, but they’re very difficult to execute. Most people need help getting it done.
Ask experienced advisers how many portfolios they’ve reviewed that lack philosophy, strategy, and discipline and you’ll make them laugh. That’s because almost all portfolios lack these elements. Investors say they’ve got them, or think they have them, but their portfolios don’t show it. They hold a smorgasbord of randomly collected investments that have no relationship to each other except that they all tend to be popular ideas from days gone by.”
Comments »The ECB Cuts Rates by 0.25%
“The European Central Bank just cut interest rates by 25 bps to 0.75 percent.
That is the lowest ECB benchmark rate target ever.”
Comments »China’s Flooding of Money Markets May Confirm Interest Rate Cuts
China has been flooding money markets with hard cold cash, or digits, and is seen as a confirmation of further monetary policy. We just got a report that China has cut interest rates.
Comments »The Bank of England Offers Up 50 Billion Sterling in QE
The BoE is meeting this afternoon to discuss interest rate policy. At the moment, they have announced additional QE of 50 Billion Sterling.
Comments »Ireland Makes a Return to the Debt Markets After a Two Year Hiatus
“Ireland returns to public debt markets following an almost two-year absence amid speculation that European efforts to ease the financial burden of nations that received bailouts will lure investors.
The National Treasury Management Agency plans to sell 500 million euros ($628 million) of bills due in October, the first auction since September 2010, the Dublin-based NTMA said two days ago. Spain is scheduled to issue as much as 3 billion euros of securities maturing between 2015 and 2022, with France also selling bonds.”
Comments »The Art and Science of Timing Decisions
“Remember Malcolm Gladwell’s book called Blink? Gladwell argued that we should trust our snap judgments, using examples from science, advertising, medicine and music. These examples showed that spontaneous decisions were as good as, and usually better than, carefully considered ones.
In Wait: The Art and Science of Delay, Frank Partnoy takes the exact opposite point of view. After interviewing more than 100 experts from different fields and examining several hundred studies, Partnoy claims that most people don’t take enough time to make decisions. Using a Gladwell-esque style, Partnoy argues that the best decision makers – premier athletes, expert investors, and even popular comedians – hone the ability to wait as long as possible before deciding or acting.”
Comments »Australia Keeps Rates Unchanged at 3.5%
“Australia’s central bank kept interest rates unchanged after cuts in the previous two months as domestic employment strengthens and the local currency’s biggest gain in eight months helps contain inflation.
Governor Glenn Stevens and his board left the overnight cash-rate target at a 2 1/2-year low of 3.5 percent, the Reserve Bank of Australia said in a statement in Sydney. The decision was predicted by all 28 economists surveyed by Bloomberg News.”
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