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Monthly Archives: July 2012

Off the Rails? Goldman Lowers Q2 GDP ‘tracking’ Estimate to 1.1 pct

The July Philadelphia Fed business activity index improved less than expected and remained “significantly negative,” pointing to a third month of contraction. Following news that June existing home sales were much weaker than forecast, Goldman Sachs economists lowered their Q2 GDP tracking estimate to 1.1 percent from 1.2 percent.

Read the article here.

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Libor Scandal is Raising odds U.S. will Break up its Biggest Banks

More Pressure to Break Up Banks. We have talked over the past week with many on Capitol Hill. Reactions have varied from those who are incensed to those who roll their eyes. All seem to agree that this will further harm the big banks politically and could add more pressure to break up the banks.

Read the article here.

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Team USA Cocky Headed Into London 2012 Olympic Games

via WSJ.com

Time to unfurl Old Glory and break out the red, white and blue boxer shorts.

Four years after China became the first country since 1992 to win more Olympic gold medals than the U.S., The Wall Street Journal’s medal projections for London suggest the Star-Spangled Banner will once again play more often than any other anthem.

And for the fifth consecutive Summer Games, the U.S. should finish atop theoverall medal table.

China’s victory in the gold-medal race in 2008 was supposed to herald the arrival of the newest Olympic superpower, a vast country with 1.3 billion people and a proven government-sponsored training program. Even at the U.S. Olympic Committee headquarters in Colorado Springs, there was a growing sense that China would win the most gold and overall medals in 2012.


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Asian Stocks Inch Down in Early Trading Despite Gains in U.S.

via CNBC.com

Asian stocks edged down on Friday as weak U.S. economic data outweighed robust corporate earnings.

The S&P 500 index [.SPX  1376.51    3.73  (+0.27%)   ] rallied to a fresh 2-1/2 month peak overnight on a strong full-year outlook from IBM [IBM  195.34   7.09  (+3.77%)   ], bullish earnings from eBay [EBAY  43.95    3.49  (+8.63%)   ]and Qualcomm’s [QCOM  58.435    2.385  (+4.26%)   ] expectations for a strong December quarter. But weaker-than-expected readings on U.S. manufacturing, housing and labor markets capped gains.

The FTSE CNBC Asia 100 Index [.FTFCNBCA  6019.05    -14.26  (-0.24%)], which measures markets across Asia, dipped 0.3 percent.

Japan’s Nikkei share average slipped in early trade as a firmer yen offset positive sentiment after U.S. stocks, buoyed by corporate earnings, rose for a third straight day.

The Nikkei [.N225  8792.19    -3.36  (-0.04%)   ] eased 0.4 percent to 8,764.45, holding above its five-day moving average at 8,752.53, while the broaderTopix index was down 0.6 percent at 743.05.

Oil refiner Idemitsu Kosan retreated 0.4 percent after it shut the 220,000 barrels per day No. 2 crude distillation unit at its Chiba refinery, east of Tokyo, on Thursday evening after fire.

Toyota is close to an agreement to purchase light commercial vans from PSA Peugeot Citroen’s threatened Sevelnord plant in northern France, La Tribune reported. Its stock slipped 0.3 percent.

Seoul shares was flat as robust corporate earnings offset weak U.S. economic data.


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REUTERS EXCLUSIVE: Banks in Libor Probe Consider Group Settlement

ZURICH/WASHINGTON (Reuters) – A group of banks being investigated in an interest rate rigging scandal are looking to pursue a group settlement with regulators rather than face a Barclays-style backlash by going it alone, people familiar with the banks’ thinking said.

Such discussions are preliminary, and it is unclear if regulators will enter these talks, aimed at resolving allegations that banks attempted to manipulate the London interbank offered rate, or Libor, a benchmark that underpins hundreds of trillions of dollars in contracts.

Still, there are powerful incentives for the banks to enter joint negotiations.

Barclays Plc was the first to settle with U.S. and British regulators, paying a $453 million penalty and admitting to its role in a deal announced June 27. Its chief executive, Bob Diamond, abruptly quit the next week, bowing to public pressure and erosion of the bank’s reputation.

The sources told Reuters that none of the banks involved now want to be second in line for fear that they will get similarly hostile treatment from politicians and the public. Bank discussions about a group settlement initially took place before the Barclays agreement, and picked back up in the aftermath.

It is unclear which banks are involved in the potential settlement talks. The banks being investigated include Citigroup, HSBC, Deutsche Bank and JPMorgan Chase. They all declined to comment.

A group agreement would appeal to financial watchdogs because they would be able to announce a headline-grabbing figure, showing that they were dealing firmly with the banking industry’s misdemeanors, a banker told Reuters on condition of anonymity.


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Too Funny: Dan Rather Talking About “Trust” In Media, Vetting Process

I’m sure some or most of what he’s saying here is true. But his own background is pretty black on the subject of careful research. And that’s why it’s nice to have multiple news networks that hate each other, at polar positions. I guarantee Fox isn’t going to hold back on Obama, and CNN, MSNBC (or whatever it’s called now), etc. will not be giving Romney his choice of the pie.

(CNN) — A New York Times front-page article Monday detailed a new phenomenon in news coverage of the presidential campaign: candidates insisting on “quote approval,” telling reporters what they can and cannot use in some stories. And, stunningly, reporters agreeing to it.

This, folks, is news. Any way you look at it, this is a jaw-dropping turn in journalism, and it raises a lot of questions. Among them: Can you trust the reporters and news organizations who do this? Is it ever justified on the candidate’s side or on the reporter’s side? Where is this leading us?

As someone who’s been covering presidential campaigns since the 1950s, I have no delusions about political reporting. Candidates bargaining access to get the kind of news coverage they want is nothing new. The thicket of attribution and disclosure deals is a deep maze reporters have been picking their way through even before my time. But this latest tactic by candidates revealed by the Times gives me, to say the least, great pause. It should give every citizen pause.

Read here:

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Obama Chicago Campaign Finds Abundant Source Of Potential Voters

Hahaha, sorry I couldn’t help it.

NEW YORK (CNNMoney) — For $10, identity thieves can access the full name, Social Security number and other personal information of a dead person through a list of millions of deceased Americans, known as the Death Master File.

The Social Security Administration created the file to help financial institutions and businesses prevent identity theft, by using the file to cross-reference applicants or customers to make sure they are not using a deceased person’s identity. But Senator Bob Casey, a Pennsylvania Democrat, said the agency is “inadvertently facilitating tax fraud” by allowing any member of the general public to look up personal details about anyone who has passed away and potentially steal their identity.

In a letter to the commissioner of the Social Security Administration and the acting director of the Office of Management and Budget on Thursday, Casey called for restrictions to be placed on access to the Death Master File.

“Identity theft creates a significant hardship for many American families, and robs our Nation of taxpayer dollars at a time when we face serious fiscal challenges,” Casey wrote. “Preventing the widespread publication of deceased citizens’ vital records is an important first step.”

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Feds Raid Trenton, NJ Exercising Search Warrants

Federal agents raided City Hall in New Jersey’s capital on Thursday, one day after they swarmed the home of the city’s mayor, as well as those of his brother and a campaign supporter.

“The FBI is executing search warrants at various offices at Trenton City Hall, pursuant to an ongoing investigation,” FBI Public Affairs Officer Barbara Woodruff said.

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Former ACORN Institutional Component Charged With Tax Violation

The former Texas ACORN chapter has a new name and a scheme to collect donations and divert them for political use in a way that abuses tax laws governing charitable organizations, according to a Washington-based public interest group.

Cause of Action, a nonprofit taxpayer watchdog, charged in a letter to the Treasury Inspector General for Tax Administration that the tax-exempt Texas Organizing Project (TOP), formed from the ashes of scandal-ridden ACORN, is using money funneled to it by a closely associated group called the Texas Organizing Project Education Fund for political activity.

The fund gave nearly 80 percent of its revenues — approximately $640,000 — to the advocacy group in 2010, leading Cause of Action officials to believe its reason for being is to raise charitable donations to send to TOP, which is permitted to fund political activity. TOP has used its website to solicit support for Mary Ann Perez, a Democrat running for state representative.

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Russia, China Veto Syria UN Resolution

UNITED NATIONS – Russia and China again vetoed a Western-backed U.N. resolution Thursday aimed at pressuring President Bashar Assad’s government to end the escalating 16-month conflict in Syria.

The 11-2 vote, with two abstentions from South Africa and Pakistan, was the third double veto of a resolution addressing the Syria crisis by Damascus’ most important allies.

The defeat leaves in limbo the future of the 300-strong U.N. observer mission in Syria, which was forced to suspend operations because of the intensified fighting. Its mandate, to monitor a cease-fire and implementation of international envoy Kofi Annan’s peace plan, expires Friday.

Britain’s U.N. Ambassador Mark Lyall Grant, who sponsored the Western-backed draft, said he was “appalled” at the third double veto of a resolution aimed at bringing an end to the bloodshed in Syria and creating conditions for political talks. The resolution had threatened sanctions if the Syrian regime didn’t quickly stop using heavy weapons.

“The consequence of their decision is obvious,” he said. “Further bloodshed, and the likelihood of descent into all-out civil war.” Activists say more than 17,000 people have been killed since the uprising began in March 2011, most of them civilians.

“The consequence of today’s action is the situation will continue to deteriorate,” U.S. Ambassador Susan Rice told reporters.

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APC, Government Fail To Settle Tronox Suite

Anadarko Petroleum Corp. (APC) and its Kerr-McGee unit failed to settle a $25 billion lawsuit brought by the U.S. and Tronox Inc. and a trial will resume next week, a lawyer said. Anadarko fell as much as 5.2 percent.

“There is no settlement agreement and we’re going to be resuming trial” on July 24, John Hueston, a lawyer for the U.S. and Tronox said today in a phone interview. Hueston declined to comment on whether further settlement talks were possible, or potential amounts discussed in the talks, which have been going on since at least July 12.

Anadarko remains “committed to resolving the Tronox litigation through informal negotiations or other alternative dispute resolution mechanisms,” John Christiansen, a company spokesman, said in an e-mailed statement. He said that the trial is set to resume July 24, as previously scheduled, and declined to comment on the status of the negotiations, saying they are confidential.

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Union Pacific CEO: Economy To Keep Growing

The economy continues to grow slowly, and the upswing should continue through the rest of the year, Jack Koraleski, Union Pacific CEO, told CNBC’s “Squawk on the Street” on Thursday.

Koraleski spoke hours after Union Pacific (UNP) posted record second-quarter earnings.

For the quarter, the railroad’s net income rose to $1 billion, or $2.10 per share from $785 million, or $1.59 a share, a year before.

Operating revenue rose 7 percent to $5.2 billion, in line with estimates.

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Battleground States Bombarded With Political Attack Ads

Behind newspaper headlines and TV news chatter about Mitt Romney’s time at Bain Capital and President Barack Obama’s record on managing the economy is a heavy bombardment of attack advertising.

At mid-summer, more than a month before either major party stages its nominating convention, each side’s message can be summarized simply.

Republicans cast Obama as an old-style politician who has traded “hope and change” for harsh attacks in order to mask his incompetence in turning around the economy. Democrats cast Romney as the personification of what’s wrong with the economy in the first place – a financial wizard whose expertise is not at creating jobs but rather at reaping dubious profits at the expense of middle-class workers.

Those advertisements aren’t seen in vast areas of the country, including huge population centers such as California and New York whose leanings in the presidential race don’t appear in doubt. Instead, they air principally in a handful of swing states that the Obama and Romney campaigns are battling over, including Ohio, Florida, Iowa, Nevada, Colorado, New Hampshire, North Carolina and Virginia.

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MORE DROUGHT: U.S. Government Forecasts Hotter, Drier-Than-Average August $CORN $DBA

WASHINGTON (Reuters) – Hotter-than-average temperatures are expected over the vast majority of the contiguous 48 U.S. states in August, with below-average precipitation for Midwest areas already hit by the worst drought in a half century, the government said on Thursday.

After the hottest half-year on record in the United States, hotter, drier conditions from the Southwest, through the Midwest and across the East Coast from Florida to Maine are forecast to continue through October, the National Oceanic and Atmospheric Administration said.

Drought hit 29 U.S. states, with Texas feeling the heaviest impact, followed by Colorado, Missouri, Florida, New Mexico, Arkansas, Indiana and Hawaii.

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Market Update

U.S. equities opened to the upside only to be dragged down by poor Phily Fed data.

Equities managed to rebound after poor data and focus on earnings and some hot IPOs issued today.

Europe  has pared some of their gains, but remains strong given no sell off in the U.S. and decent earnings reports.

For all intensive purposes today is shaping up to be a day of digesting recent gains.

Gold has rebounded nicely and oil is popping over 2%.

Markets are led by conglomerates and technology.


[youtube://http://www.youtube.com/watch?v=66HvCjn8Wsk 450 300]

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U.S. Drought to Create a “Cowpocalypse”

$MS says the USDA is too conservative with estimates relating to corn and wheat. In addition the lack of grain harvest will have a serious impact on cow herds.

Eat up before prices sky rocket.

Full article

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Disaster Losses Help Travelers to Miss Estimates

“(Reuters) – Travelers Cos Inc reported lower-than-expected quarterly profit on Thursday as the insurer’s catastrophe losses fell from a year ago but were still higher than historical norms.

Travelers executives said they believe the industry lost more than $10 billion on natural disasters in the April-June period, making it one of the worst quarters ever. Chief Executive Jay Fishman, on a call with analysts, said the company lost more in the quarter than it would normally lose in a full year not that long ago.

To deal with the losses, Travelers said it is continuing to push for higher prices where it can and also tightening up on terms and conditions — for example, refusing to insure houses with roofs of a certain age.”

Full report

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