The great interest rate ripp off part 2

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Breaking news

 

• Dell prepping Windows tablet, refreshing PCs - Reuters
  
• Copper mkt awaits China verdict on $10,000 copper - Reuters
  
• Fed's Fisher says would dissent on further easing - Reuters
  
• German Vossloh eyes Brazil takeover targets -paper - Reuters
  
• Toyota lifts forecast sharply but yen remains drag - Reuters
  
• U.S. probe clears Toyota's electronic throttles - Reuters
  
• SocGen's Boursorama warns on 2010 profit - Reuters
  
• SAC Capital employees arrested in trading probe - Reuters
  
• German pact aims to harmonise corp tax rates - Reuters
  

 

 

 

• Ed Balls accuses government of delivering 'tax cuts for banks'
   
  Shadow chancellor attacks coalition approach to banks even after George Osborne slapped an extra £800m tax on profits this year
  634 comments
  
  • Vote: is £800m a 'fair contribution' to society?
    
  • Nils Pratley Nothing wizard about Project Merlin
    
  • Video: Nils Pratley on the £800m in extra tax
    

  [*] BA cabin crew strike ballot 'unlawful'

   

  Union abandons threat of fresh walkouts after British Airways questions legality of January ballot

  [*] Lloyds layoffs hit 26,200 as 200 more go

   

  Cuts to hit Chester, Leicester, Edinburgh, Newport, Copley in West Yorkshire and Shannon in Ireland, where 80 of the 200 jobs are being lost

  Post your comment

  • Ireland 'faces jobless recovery'
    

  [*] Toyota quarterly profits tumble 39%

   

  Toyota raised its full-year net profit forecast, saying sales in Asia, excluding Japan, rose 21% to 335,000 units in the quarter

 

 

• Salad slaves
   
  Who really provides our vegetables
   
  Video: Costa del Sol is famous for its beaches but just behind them is a hidden world of industrial greenhouses where African migrants work in harsh conditions
  
  
• Year of the Rabbit ushers in China's second rate rise in six weeks
   
  Markets braced for fresh action from China to curb inflation after Beijing announced a second increase in the cost of borrowing
   
  
  • US tries to win Brazil's support in China currency row
    

  [*] Egypt unrest costs Thomas Cook £20m

   

  Thomas Cook says anti government protests in Egypt and Tunisia will wipe £20m off profits as customers cancel holidays

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  [*] More business news

  [*] Nokia 'considering move to Silicon Valley'

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http://www.acting-man.com/?p=6321

 

The Road to Perdition

February 8th, 2011 | Author: Pater Tenebrarum

The Bernankean World View – As Misguided As Ever We actually said last week we would not comment on Bernanke's truly cringe-worthy speech delivered last Thursday. Our reasoning was that he didn't say anything unexpected or anything we have not heard a thousand times before. This is certainly true, but we now feel compelled to comment anyway, if only to shine a light on what a horrible steward of the monetary system he is – while acknowledging that he certainly didn't design said system and is in equal measure its prisoner as much as its director.

 

 

 

Following his speech he was subjected to a soft-balling exercise (Q&A) at the National Press Club in Washington, as Randall W. Forsyth put it in Barron's. Below we'll quote the synopsis of the important parts of the Q&A as related in the Barron's article.

 

The whole thing was as good an example of Bernanke's Princeton-bred sophistry as you will ever find. Princeton of course is the major hotbed of the semi-totalitarian Keynesian economic philosophy and the associated attempt to make economics more 'scientific' by subjecting it to econometric methods – measuring what can not be measured and deriving 'models' and 'theories' from these nonsensical efforts at imitating the natural sciences - the same methods that guide the Federal Reserve in its decision making process.

 

Quoth Forsyth:

 

 

 

„Proving Lincoln's adage you can fool some of the people all of the time, Bernanke asserted to the credulous DC press corps that while the Fed's purchases of Treasury securities played a role in the rise in stock prices since last August, they did not affect the prices of commodities, notably food. Moreover, he rejected the premise that the civil unrest seen in Egypt and Tunisia could be attributed to Fed policy, which the questioner contended was responsible for higher food prices.

 

Commodity prices, including food, were driven by supply and demand, the Fed chairman argued. And that demand was being elevated by rising prosperity in emerging economies, which means a desire for a better diet. That, in turn, was mainly responsible for the sharp rise in food prices.

 

At the same time, the liquidity created by the Fed's purchases of up to $600 billion of Treasury securities was working as planned, Bernanke continued. According to the Fed chairman, QE2 has boosted asset prices, notably stocks; lowered market volatility and thus, risk; narrowed corporate-credit risk spreads; and has lifted inflation premia in the Treasury Inflation Protected Securities market. That Treasury yields are higher since the Fed started buying Treasury securities is not inconsistent with QE2's working.

 

Much more at the link.

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Osborne in £800m tax raid on banks new

 

 

The unexpected move was greeted with shock and anger by the banks, with some bank chiefs reported to be "livid".

 

 

• M&S poaches Tesco's online chief to power internet sales
  
• Discounting and a dash to beat VAT rise lift retail sales
  
• Helicopter bids halted amid probe new
  
• Lloyds condemned as 200 more jobs go
  
• Riots 'to hit Thomas Cook profits'
  
• Retail sales bounce back in January
  
• Terra Firma could voice interest in Chaucer bid
  

 

David Prosser: An unfortunate hat-trick provides King's critics with plenty of ammo

 

Now more than halfway through his second term of office, the Governor still has an enormous amount of work to do to secure his reputation

 

 

• Stephen Foley: Fed chief Bernanke spells out home truths on financing the future
  
• David Prosser: Pushing the pills may be the world's most risky business
  
• David Prosser: Breaking news: bankers show restraint
  
• David Prosser: Mixed message lets Opec off the hook
  
• Bankers’ pay is crazy. Footballers’ pay is not
  

 

Building a bright future for Britain's job trainees

 

The Government's £1.4bn investment in apprenticeships faces its biggest challenge in Britain's schools. Sarah Arnott reports

 

 

• The Business on: Sergio Marchionne, Chief executive, Fiat and Chrysler
  
• Charities hit by corporate stinginess
  
• The Business On: Igor Sechin, Deputy Prime Minister of Russia
  
• The top tables where Brits no longer rule
  
• Brendan Barber: The union man who won't use a megaphone
  

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http://www.guardian.co.uk/business/ireland-business-blog-with-lisa-ocarroll/2011/feb/02/ireland-merrill-lynch-research-note-irish-banks

 

US investment bank Merrill Lynch had a critical role in the banking collapse in Ireland and censored an analyst's report that predicted the crash back in 2008, it was claimed today.The US bank retracted a report by one of its research analysts in March 2008 that was negative about the banks after the Irish banks called Merrill Lynch and threatened to take their business elsewhere. It toned the research note down and months later its author, Philip Ingram, left the bank, according to a much-anticipated cover-story in the new edition of Vanity Fair.

And one of his colleagues, Ed Allchin, was made to apologise to Merrill's investment bankers individually for the trouble he'd caused them by suggesting there was still money to be made by shorting Irish banks.

Allchin, who has since set up a new company Autonomous Research refused to comment. "I haven't even seen the article," he said.

The 15 page Vanity Fair article is written by Michael Lewis, a former bond trader who described his experiences working at Salomon Brothers in the bestselling book, Liar's Poker.

 

More at the link.

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http://ftalphaville.ft.com/blog/2011/02/08/482321/the-missing-bits-from-merrills-ireland-note/

 

Last week, Michael Lewis brought you his take on Ireland, a Vanity Fair epic on the nation’s real estate and banking bust. He also brought us the story of Philip Ingram, a zoology student and former Merrill Lynch banking analyst.

Ingram, Lewis says, was one of the few analysts to really ‘get’ the looming financial crisis in Ireland. In early 2008 he conducted a survey of commercial property players, with the results published in a March 2008 note. According to Lewis, Merrill ended up retracting the report, allegedly at the behest of its Irish bank clients. A “toned down” version, one that was “purged” of insider quotes, was eventually published instead.

On Monday FT Alphaville brought you Merrill’s ‘abridged’ Ireland note.

On Tuesday we had to take it down. However, we now have a purported copy of Philip Ingram’s original — courtesy of Colin Coyle at the Sunday Times in Ireland, who covered the story last week for the Irish paper

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Bank tax hiked as crunch looms for lending deal

 

LONDON (Reuters) - The government saddled banks with an extra 800 million pounds in tax on Tuesday, drawing protest from the industry as talks between bosses and ministers over bonuses and lending come to a head.

 

• U.S. probe clears Toyota's electronic throttles 7:28pm GMT
  
• FTSE jumps as banks and miners rally 5:13pm GMT
  
• Anglo posts new record loss, as government breaks it up 7:10pm GMT
  
• Euro zone finmins to discuss rescue fund changes Monday
  

Recent Business News

 

 

UBS sees strong rise in client money in 2011

 

ZURICH (Reuters) - UBS expects to win more client money for its wealth management business in 2011 and sees a rebound in the investment banking division whose losses almost felled it in the financial crisis.

2:36pm GMT

 

Xstrata year profit up 86 percent

 

LONDON (Reuters) - Miner Xstrata beat forecasts with an 86 percent jump in full-year profit on stronger commodity prices, and gave a positive outlook for 2011.

12:18pm GMT

 

China raises rates to battle stubbornly high inflation

 

BEIJING (Reuters) - China raised interest rates on Tuesday for the second time in just over six weeks, intensifying a battle in the fast-expanding economy against stubbornly high inflation that threatens to unsettle global markets.

5:23pm GMT

 

Union to re-run BA cabin crew strike ballot

 

LONDON (Reuters) - The union representing British Airways cabin crew said on Tuesday it planned to ballot members again on taking strike action after saying a recent vote was potentially invalid.

UK, Aerospace & Defence 4:15pm GMT

 

BG confident on future growth

 

LONDON (Reuters) - Gas firm BG Group Plc beat forecasts with a 13 percent rise in fourth-quarter profit and said Brazil and U.S. resources would raise its future production, sending its shares to a record high.

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8 February 2011 Last updated at 19:43

 

Government to increase bank levy

 

The government says it will increase the levy on UK banks by £800m to £2.5bn, prompting fury from bankers and provoking barbed debate in parliament.

 

• Q&A: Bank levy explained
  
• Peston: Bankers 'livid'
  
• Robinson: Tax rise or tax cut?
  
• Balls v Osborne: First blood
  

 

BA forces new crew strike ballot

 

British Airways cabin crew are to be balloted again on strike action after the airline said a previous vote was unlawful.

 

• Q&A: What's the BA dispute about?
  

 

 

Irish lenders' assets up for sale

 

The Irish Republic will start an auction process for the sale of the deposits and assets of Anglo Irish Bank and Irish Nationwide.

 

• Irish banks: Are my savings safe?
  

 

 

 

• Retail sales 'rebound' in January
   
  UK retail sales rebounded in January after bad weather caused sales to drop in December, figures suggest.
  
• Caution dominates housing market
   
  Cautious buyers and sellers failed to add any fresh impetus into the UK housing market in January, according to a survey.
  
• US clears Toyota over electronics
   
  A US investigation into Toyota safety problems finds no electronic flaws to explain complaints about unintended acceleration.
  
• Premium Bond prize money delayed
  
• McNuggets boost McDonald's sales
  
• Pakistan strike grounds flights
  
• N Africa unrest hits Thomas Cook
  
• China raises interest rates again
  
• Fire ravages Ivory Coast treasury
  
• Arcelor Mittal sees steel rebound
  
• Strong commodities lift Xstrata
  
• UK pension funds' surplus grows
  
• Financial knowledge 'is lacking'
  

 

'Nasty surprise'

 

Bank bosses are furious about Osborne's additional levy

The pound question

 

If the Bank of England raises interest rates, will the pound rise or fall?

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[/url]

 

 

George Osborne's £2.5bn bank levy attacked by banks and Balls

 

Chancellor was accused of 'moving the tax goalposts' by banks and of a 'damp squib' by Labour after he increased a levy on bank profits to raise £2.5bn this year and made it permanent.

Osborne bank levy: live

 

 

The real reason for a higher bank levy

 

 

Analysis: Chancellor acts tough ahead of Ed Balls clash

 

 

Chancellor: in his own words

 

 

Bank levy: Q&A

 

 

 

 

China raises rates for third time in four months

 

China raised interest rates on the last day of the Chinese New Year holiday to try to temper inflation as the country returns to work.

Growing out of control? China by numbers

 

 

China raises interest rates: what the economists are saying

 

 

 

Fresh BA strike ballot amid bullying claims

 

British Airways' cabin crew union lashed out at the airline's management after disclosing it had been forced to scrap last month's mandate for further strikes on legal grounds.

 

'Nationalisation of SA mines not an option'

 

Susan Shabangu, South Africa’s respected mines minister, has dismissed talk of nationalisation of the mining sector as “not an option", after calls by the ANC youth wing.

Zuma needs to take on youth wing

 

 

Anglo's Cyclone Cynthia - one to back in a fight

 

 

 

High Street rebounds as house prices fall

 

 

 

 

Twelve countries claim Glaxo vaccine causes narcolepsy

 

 

 

 

Manchester United moves to Mayfair

 

 

 

 

Xstrata rides commodity boom as profits increase six-fold

 

 

 

 

Staff refused time off for Royal Wedding

 

 

 

 

Sky making 'excessive profits' from movies

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4 Hedge Fund Employees Face Insider Trading Charges

 

By PETER LATTMAN and AZAM AHMED 32 minutes ago

 

Two of the four had worked at SAC Capital Advisors, the giant fund run by the billionaire Steven Cohen.

China Raises Interest Rates to Quell Inflation

 

By BETTINA WASSENER 8:17 AM ET

 

The move, the third since October, is the latest sign of authorities’ intensifying efforts to temper the pace of growth and curb inflation.

 

U.N. Food Agency Issues Warning on China Drought

 

By KEITH BRADSHER 12:32 PM ET

 

China’s wheat crop is threatened, and some people face shortages of drinking water, the agency warned on Tuesday.

 

Media Decoder Blog

 

Jeff Fager to Be Named Chairman of CBS News

 

By BILL CARTER and BRIAN STELTER

 

Jeff Fager, the executive producer of "60 Minutes," will be named chairman of CBS News, the network announced Tuesday.

 

Media Decoder Blog

 

Olbermann to Host Show and Have Executive Role

 

By BRIAN STELTER 1:01 PM ET

 

Keith Olbermann’s prime-time program for Current TV will begin in the spring, the channel announced.

 

• AOL’s Bet on Another Makeover | Which Site Will Be Sold Next?
  

 

Volkswagen Agrees to Wage Increase for Workers

 

By JACK EWING 20 minutes ago

 

The deal ensures workers a larger share of soaring profits in the German auto industry — and may signal an end to a decade in which pay barely kept pace with inflation.

 

• Video: Volkswagen Workers Get a Raise
  

 

Earnings and China’s Rate Increase Limit Wall Street Gains

 

By THE ASSOCIATED PRESS 14 minutes ago

 

China’s central bank raised its benchmark rate for the second time in a month while several companies reported results that missed expectations.

 

UBS Posts First Yearly Profit Since Financial Crisis

 

By DAVID JOLLY 12:18 PM ET

 

The Swiss banking giant reported “substantial progress” in turning around its business, but the wealth management division continued to struggle.

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Which Month Doesn't Fit?

 

This is ugly....

1/31/2006 25,645,896,285.90

1/31/2007 27,336,683,880.94

1/31/2008 8,835,629,723.80

1/30/2009 -67,799,617,875.20

1/29/2010 -32,713,679,545.20

1/31/2011 105,835,837,302.30

Oops.

This is the January actual operating deficits in terms of debt increase or decrease by Treasury.

Just looking back to 2006 there's a real problem here. January is normally a good month for the deficit because the last estimated payment is due; ergo, we should have lower deficit numbers.

The bad news is that if this trend continues we're going to blow the $1.7 trillion numbers from last calendar year with some authority. As I pointed out in my annual Ticker, we are on a path toward a $2 trillion deficit this calendar year, and I have no expectation, and neither should you, that we'll get away with that.

This much is certain: The government has been lying about intentions on deficits forever. We have now run three years consecutively where we have said we'll stabilize and then start dropping the deficit, and instead we have gone the other direction. The argument for short-term stimulus must have a "use-by" date, and yet we simply refuse to stamp a date on it, instead saying "we'll do it until employment returns."

What if employment does not come back because the deficit spending and government mandates are causing continued unemployment by forcing input cost ramps that squeeze producers?

That's something you should contemplate carefully, because if this is anything close to accurate then we're going to go right down the toilet while screaming but it will get better - I promise!

The time to learn from our mistakes and stop the insanity is quickly running out.

 

Still all that borrowed money counts towards GDP....

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http://dailybail.com/home/amagerbanken-28-billion-bank-failure-in-denmark-senior-bondh.html

 

It may turn out to be the most important bank you've never heard of.

Amagerbanken was taken over by the Danish government today. As with the Irish banks, Amagerbanken suffered huge losses on loans to property developers and investors in commercial real estate. But the rescue comes under new regulations which stipulate steep losses for bondholders. According to Bloomberg, senior bondholders and depositors over the insured limit will face losses of approximately 41%.

Some bondholders, however, still fall under a government guarantee, but expect Amagerbanken to be held up as an example by those who favor haircuts for bondholders rather than bailouts. In particular, we can expect Ireland's Fine Gael party (pronounced feena gail) to point to Denmark when they make their own case for unilaterally restructuring Ireland's bank debt. And when they do, the cat will be out of the bag.

For two years, central bankers and government finance ministers (who know next to nothing) have been claiming that the sky will fall and there will be tanks in the streets if bondholders are forced to take losses. Clearly that is not the case. First Iceland, then Denmark, then Ireland. After that, the race is on.

From Reuters

COPENHAGEN, Feb 7 (Reuters) - Denmark was lumbered with a $2.8 bln bill on Monday as Amagerbanken (AMBA.CO) became the country's tenth bank to fall into the state's hands in the wake of the global financial crisis.

Amagerbanken said on Sunday it would transfer its assets to Finansiel Stabilitet A/S, the state company that administers failed banks, and administrators would close the bank.

 

Just remember it's all contained.....

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http://www.nytimes.com/2011/02/09/us/politics/09states.html?_r=1&ref=business

 

President Obama is proposing to ride to the rescue of states that have borrowed billions of dollars from the federal government to continue paying unemployment benefits during the economic downturn. His plan would give the states a two-year breather before automatic tax increases would hit employers, and before states would have to start paying interest on the loans.

 

The proposal, which administration officials said would be included in the 2012 budget that the president is scheduled to unveil next week, was greeted coolly by Republicans on Capitol Hill, who warned that the plan would ultimately force many states to raise their unemployment taxes in the years to come.

 

But the White House is calculating that the proposal will ultimately appeal to Republicans because it involves a tax moratorium right now for hard-hit states during a still-fragile economic recovery.

 

Administration officials will make the case that the plan helps the economy and states in the short run, while bringing overdue changes to the unemployment insurance system in the long run. And Republican lawmakers could find themselves under pressure from Republican governors, whose states owe the federal government billions of dollars.

 

The administration is also betting that employers will back the proposal, especially in states where their taxes would otherwise go up. Michigan, for instance, owes the federal government $3.7 billion it borrowed to pay unemployment benefits. Under current law the state would be forced to pay $117 million in interest to the federal government this fall, and the federal tax on employers would automatically step up each year to repay the debt.

 

The state’s newly elected Republican governor, Rick Snyder, has been lobbying for relief; his press secretary, Sara Wurfel, said that while they would need to see the details of the plan, they would “very likely welcome the much-needed relief.”

 

Robert Gibbs, the White House press secretary, said, “We are giving help to some states who have had to borrow and not been able yet to pay back.”

 

The states are in a tough spot. Many entered the recession with too little money in their unemployment trust funds, and they quickly ran through what little they had as unemployment rose and remained stubbornly high month after month.

 

With their own trust funds depleted, 30 states borrowed $42 billion from the federal government to continue paying unemployment benefits.

 

The federal stimulus act gave states a break on the interest for those loans for nearly two years, but that grace period ended Dec. 31. That has left hard-hit states, which have already laid off employees, cut services and raised taxes, facing an estimated $1.3 billion in interest payments to Washington due this fall.

 

Extend and pretend.

 

I love how they think that delaying these repayments for a couple of years will somehow fix the expenditure issues in these states. Revenues don't meet expenditure it's likely if current commitments continue they never will. The delaying of interest repayments will probably become perpetual, the govt will have no choice.

 

I think Gibbs meant to say we are giving aid to states who'll never pay us back.

[interestrateripoff]

Breaking news

 

• Slovenia's central bank governor Marko Kranjec - Reuters
  
• 3M's China margins will beat company average: CFO - Reuters
  
• PROFILE:Slovakia's Finance Minister Ivan Miklos - Reuters
  
• Chipotle flagged immigrant worker audits last year - Reuters
  
• Bonds rise after strong $24 bln 10-year auction - Reuters
  
• US STOCKS-Market slips from 2 1/2-yr high on profit-taking - Reuters
  
• German government seeking investor for EADS-report - Reuters
  
• CBOE shares surge, seen as next takeover target - Reuters
  
• EMERGING MARKETS-Latam stocks drop as foreign investors exit - Reuters
  

 

 

 

• NYSE Euronext in merger talks with Deutsche Börse
   
  Euronext news follows announcement that London Stock Exchange is joining forces with Canada's TMX stock exchange operator
  28 comments
  
• Osborne accused of 'throwing in the towel' with bank bonus deal
   
  Pay to be restricted at bailed out banks and £190bn to be lent to businesses under details of long-awaited Project Merlin
  250 comments
  
  • Live blog: Andrew Sparrow follows the action
    
  • Project Merlin: which side won?
    
  • Osborne's full statement on the banks
    
  • The banks' letter to the chancellor (pdf)
    
  • Osborne's latter to John Varley (pdf)
    
  • Osborne on Project Merlin and bonuses - video
    

  [*] RBS and Lloyds chief executives accept £3.49m in bonuses

   

  Acceptance of first bonus since joining RBS likely to set precedent for other banks' chief executives

  38 comments

  • Nils Pratley: Osborne's £800m message to bankers
    
  • Video: Nils Pratley on the £800m in extra tax
    
  • Banks close in on deal to keep payouts secret
    
  • 50% of Tory funds come from City
    
  • Top 10 Tory donors – in pictures
    

  [*] UK trade deficit hits record £9.2bn

   

  Fresh rise in the deficit, with imports outweighing exports, shows how tough Britain's firms are finding it to capitalise on the weaker pound

  171 comments

  • CBI predicts interest rate rises
    

 

 

• 'Overconfident' IMF downplayed risks in run-up to financial crisis
   
  International Monetary Fund failed to spot looming crash and praised US and UK financial regulation, says damning report
  17 comments
  
• JP Morgan seeks jury trial in Bernard Madoff lawsuit
   
  Bank claims Madoff trustee's lawsuit raises questions that bankruptcy court cannot answer, and seeks to have case moved to federal court
  
• Williams F1 team founders to share £59m
   
  Last updated one minute ago
  F1 boss Sir Frank Williams and partner Patrick Head will share €70m in a forthcoming listing of the racing team in Frankfurt
  
• WikiLeaks cables: Saudi Arabia cannot pump enough oil to keep a lid on prices
   
  US diplomat convinced Saudi Arabia's reserves may have been overstated by 40%, meaning oil price could go out of control from 2012
   
  
  • BG raises gas production targets
    

  [*] More business news

  [*] Nokia's chief: 'We are standing on burning platform'

[interestrateripoff]

Bank bonuses to be cut under new deal new

 

 

The UK's biggest banks today agreed to rein in bonuses and lend £190bn to businesses this year after hammering out a deal with the Government.

 

• Revealed: how City bankrolls Tory party
  
• Osborne under pressure to cut growth forecasts
  
• London Stock Exchange in Canada merger
  
• Trade gap widens to record high
  
• Britons head to beach instead of royal wedding
  
• Retailers absorb impact of rise in VAT – for now
  
• Beazley eyeing deals as Lloyd's gets set for an M&A boom
  

 

David Prosser: A pyrrhic victory in the Chancellor's battle with the banks

 

 

Outlook That's told them. Those naughty banks, still refusing to sign up to new lending targets despite their role in plunging Britain into recession, now know who is boss. The punishment for their failure to agree to the Project Merlin deal on lending is another £800m of bank levy tax.

 

 

• David Prosser: Sky TV continues its losing streak
  
• David Prosser: Why Premier won't be breaking with bread
  
• David Prosser: An unfortunate hat-trick provides King's critics with plenty of ammo
  
• Stephen Foley: Fed chief Bernanke spells out home truths on financing the future
  
• David Prosser: Pushing the pills may be the world's most risky business
  

 

Debt casts shadow over Main Street as budget crisis looms

 

Municipal finances have suffered from US economic hardship and are becoming the next cause of concern as funds and jobs dry up

 

 

• Building a bright future for Britain's job trainees
  
• The Business on: Sergio Marchionne, Chief executive, Fiat and Chrysler
  
• Charities hit by corporate stinginess
  
• The Business On: Igor Sechin, Deputy Prime Minister of Russia
  
• The top tables where Brits no longer rule
  

[interestrateripoff]

• Shock rate rise not ruled out at February meeting 6:58pm GMT
  
• Ex-dividends, weak miners, dent FTSE 5:28pm GMT
  
• Bank deal sealed but critics see loopholes 6:15pm GMT
  
• Strong start for economy in 2011 but no momentum - Reuters poll
  

 

NYSE, Deutsche Boerse in advanced merger talks

 

NEW YORK/FRANKFURT (Reuters) - Germany's Deutsche Boerse is in advanced talks to buy NYSE Euronext, and the London Stock Exchange has agreed to buy Canadian stock market operator TMX, as exchanges globally look for ways to boost their markets and cut costs.

 

Bernanke - U.S. job growth, inflation still too low

 

WASHINGTON (Reuters) - U.S. unemployment is too high despite an improving economy, Federal Reserve Chairman Ben Bernanke told Congress on Wednesday, suggesting the central bank has no intention of cutting short a $600 billion (372 billion pounds) bond-buying program.

6:12pm GMT

 

Nokia drops new Meego phone, bemoans plight

 

HELSINKI (Reuters) - Nokia has ditched plans for a new smartphone and compared the company's plight to an oil platform on fire just days ahead of a key strategy presentation, according to industry sources.

4:33pm GMT

 

JPMorgan fires back in $6.4 billion Madoff lawsuit

 

NEW YORK (Reuters) - JPMorgan Chase & Co accused the trustee seeking $6.4 billion (3.9 billion pounds) for victims of Bernard Madoff's Ponzi scheme of doing an end run around the law in pursuing his case, and said it has a right to a jury trial.

5:13pm GMT

 

Williams Grand Prix sets price for share offer

 

FRANKFURT/LONDON (Reuters) - Formula One racing team operator Williams Grand Prix Holdings has set the price range for its initial public share offer in Frankfurt next month at 24 to 29 euros, to raise up to 78 million euros (£66 million). | Video

Sports 6:06pm GMT

 

IMF says Irish politicians could hold up bank reforms

 

DUBLIN (Reuters) - Ireland's politicians could hold up a banking sector overhaul agreed under an 85 billion euro rescue deal, the International Monetary Fund (IMF) warned on Wednesday.

Bank deal sealed but critics see loopholes

 

LONDON (Reuters) - The government finalised a tortuous deal with banks on Wednesday to curb bonuses and boost lending to business, but critics said the agreement would be hard to enforce describing it as "political theatre."

[interestrateripoff]

9 February 2011 Last updated at 17:50

 

Banks sign lending and bonus deal

 

A long-awaited agreement with the largest UK banks on lending and bonuses is announced by the government.

 

• Peston: Merlin details
  
• Bank deal 'pitiful' - top Lib Dem New
  
• RBS bonuses fall to £950m
  
• Q&A: Project Merlin bank deal
  
• Business loans: Your views New
  
• Osborne on bankers' 'restraint' Watch
  

 

NY and Deutsche bourses mull deal

 

NYSE Euronext and Deutsche Boerse are in advanced talks about a merger that would create one of the world's biggest exchanges.

 

• LSE in merger with Canada's TMX
  

 

 

Nokia at crisis point, warns boss

 

The new boss of Nokia warns staff that the company is at crisis point, having been squeezed by rivals such as Apple and Google.

 

• Nokia's burning platform
  

 

 

 

• Export help for small businesses
   
  Measures to encourage smaller companies to export more are unveiled by the business secretary, as the UK's trade deficit widens.
  
• IMF 'downplayed' risks of crisis
   
  An inquiry into the IMF says that the agency downplayed the economic risks ahead of the financial crisis.
  
• Parents 'save more for uni fees'
   
  The prospect of university fees rising to £9,000 a year is prompting parents to save more for their children's education, research suggests.
  
• Council pension scheme 'threat'
  
• Bernanke warns on unemployment
  
• LSE in merger with Canada's TMX
  
• 'Parasitic' sugar traders blamed
  
• Boat race sponsors' shares dive
  
• RBS banker bonuses fall to £950m
  
• Welfare overhaul plans 'imminent'
  
• Out-of-school care 'a struggle'
  
• Cold snap insurance claims double
  
• Peugeot sees strong 2010 recovery
  
• Cillit Bang firm sees profit jump
  

[interestrateripoff]

[/url]

 

 

Deutsche Borse and NYSE Euronext in merger talks

 

The New York Stock Exchange and Deutsche Borse have confirmed they are in advanced merger talks in a deal that would create the biggest stock exchange in the world worth $24bn (£14.9bn).

LSE buys Canada's TMX

 

 

London Stock Exchange buys Canada's TMX: main points

 

 

LSE's tumultuous history of bids

 

 

 

 

Rates must be raised, warn ex-MPC members

 

Two former Bank of England policymakers have said they would vote for an increase in interest rates on Thursday to convince the market that the central bank is not going soft on inflation.

 

Osborne urges UK to move on from retribution

 

George Osborne has urged the country to put an end to banker bashing and move "from retribution to recovery" as he unveiled details of a deal with UK banks which will cut bonuses and increase lending to small businesses.

Bosses of state-owned banks accept multi-million pound bonuses

 

 

Bank deal: reaction

 

 

Project Merlin: in 60 seconds

 

 

 

UK exporters to access state-backed finance

 

The Government has launched a series of finance and insurance products to help small business exporters grow sales overseas.

 

40pc of property sellers cut their asking prices

 

 

 

 

IMF: Japan's debt and deficit 'are not sustainable'

 

 

 

 

Bundesbank chief throws ECB presidency into doubt

 

 

 

 

Hedge fund worker hunted city for dump truck

 

 

 

 

Insurers hit with £1.43bn bill for the Big Freeze

 

 

 

 

Fresh BA strike ballot amid bullying claims

 

 

Housing is in need of some shock therapy

 

"Lord make me chaste, but not yet". I've used this famous prayer by St Augustine many times before in commenting on the public policy response to the credit crunch, and make no excuse for citing it again.

 

JPMorgan blasts Bernard Madoff trustee

 

JPMorgan Chase has accused the trustee seeking $6.4bn for victims of Bernard Madoff's Ponzi scheme of bypassing the law in pursuing his case, and said it has a right to a jury trial.

Bosses of state-owned banks accept multi-million pound bonuses

 

 

Number of workers finding permanent jobs rises at fastest rate in six months

 

The jobs market appeared to turn a corner in January as the number of people placed in permanent positions rose at the fastest rate in six months, new figures showed.

[interestrateripoff]

Japan Debates Depictions of Young Girls in Comics

 

By HIROKO TABUCHI 11:28 AM ET

 

 

Publishers and fans are objecting to newly tightened restrictions on sales of explicit manga comics in Tokyo.

 

• Post a Comment | Read (65)
  

 

 

 

Ko Sasaki for The New York Times

 

Adult games and DVDs for sale in Tokyo. Some officials want to tighten restrictions on provocative depictions of young girls in magazines, DVDs and Web videos.

 

 

 

 

 

 

Congress Questions Bernanke on Inflation

 

By SEWELL CHAN 11:12 AM ET

 

The Federal Reserve chairman faced tough questions in his first appearance before the new Republican majority.

 

Britain Reaches Deal With Banks on Lending and Pay

 

By MATTHEW SALTMARSH 10:35 AM ET

 

The agreement is an effort to get Britain’s biggest banks to lend more to businesses, which would help the economy, while reducing executive bonuses.

 

German Central Bank Undercuts 'Rumors' Around President

 

By JACK EWING 10:00 AM ET

 

The Bundesbank said there would be no “imminent” announcement regarding Axel Weber, who is seen as the front-runner to become head of the European Central Bank this year.

 

Nokia Chief Sees Company on 'Burning Platform'

 

By ERIC PFANNER 16 minutes ago

 

Nokia has fallen “years behind” Apple and Google in the market for sophisticated phones, an executive is said to have written in a leaked memo.

 

Wall Street Declines After the Latest Earnings

 

By THE ASSOCIATED PRESS

 

Stronger corporate earnings reports and economic data have helped push the Dow and the Standard & Poor’s 500-stock index to levels last seen in June 2008.

 

• China Raises Interest Rates To Counter Inflation Risk
  

 

DealBook

 

NYSE and Deutsche Börse in Talks

 

By DEALBOOK 40 minutes ago

 

NYSE Euronext said on Wednesday it was in advanced talks with Deutsche Borse over a possible merger.

 

DealBook

 

London and Toronto Exchanges to Merge

 

By IAN AUSTEN 8:35 AM ET

 

The two exchanges confirmed on Wednesday that they would merge in an all-share deal to form what could be the largest market for mining and other natural resource stocks.

 

Obama Plans to Rescue States With Debt Burdens

 

By MICHAEL COOPER and SHERYL GAY STOLBERG

 

States that have borrowed from the federal government to pay unemployment benefits would get a two-year breather before facing tax increases and loan payments.

[interestrateripoff]

Ok, What's The Real Story? (WFC)

 

Hmmmmmm..

Wells Fargo & Co

. Chief Financial Officer Howard I. Atkins resigned for personal reasons, taking an unpaid leave of absence, and will be replaced by Chief Administrative Officer Timothy J. Sloan.

Legitimate reasons to do this include your diagnosis with terminal cancer or that of a close family member.

Every other reason I can come up with repudiates this:

Atkins’ departure, effective immediately, “is unrelated to the company’s financial condition or financial reporting,” according to a statement yesterday from the San Francisco-based bank.

We'll see.

I'm skeptical. Wells has a metric crap-ton of dodgy garbage on and off balance sheet, and I have often written about it. Nobody has a damn clue about the real value (or lack thereof) these assets have. I have long pointed out that of all the major financial institutions Wells is the most exposed, simply because in terms of its capitalization it is the thinnest of the majors when one looks at the off-balance sheet and potential contingent liabilities that are represented in those alleged "assets."

Of course the other side of that coin is that if the assets are good, then they have excellent prospects.

This is the conundrum for anyone trying to analyze these companies. You can't. You have to take the word of management that the alleged "assets" they are holding are good, because there is no longer any need to use market prices in a post-Kanjorski-threat-laden world.

I refuse to take management's word for anything, because we learned during the Lehman and Bear Stearns period that even when management is well-aware of adverse information they will either withhold it or twist the truth, in no small part because nobody in top management has been indicted for anything during the entire period of this financial mess. Remember that we were told by Fuld that he was going to "Burn the Shorts", that Wachovia was perfectly sound, that WaMu was perfectly ok in paying out dividends from capitalized interest, that Countrywide was going to be the only mortgage lender of relevance when the dust settled and more. All of these statements were utter crap and while Mozilo has been sued nobody has gone to prison. Not one of them.

These people don't give a good damn if someone sues them. It's not their money. The company defends them and the suit, and if they lose, the company pays the judgment. Screw that.

The only effective means of ever policing unlawful activity is found in the threat of decades of prison time with a cellmate named "Bubba" who likes boys. A lot.

 

More at the link.

[interestrateripoff]

Ireland: Why Do You Tolerate This?

How many times will you be lied to and sit for it?

The Republic of Ireland will have to go to the IMF/EU for another €15bn - on top of the €35bn already earmarked - to save the banking system, according to the government-appointed chairman of Anglo Irish Bank.

In a bombshell revelation, Alan Dukes said we will need 40pc more, or €50bn, to properly clean up the banks.

Tell them to blow it out their butts and go bankrupt like men.

When will you wake up and stop allowing these robber barons to asset-strip not only you, but your children, grandchildren, and those not yet born?

You didn't do this. The banks did.

You have no obligation to fund this bailout, and shouldn't.

Look to Iceland. They did it, and all the dire claims of what would happen didn't. That is, not only did the banks attempt to extort them, they were unable to make good on the threat when told to stuff it.

 

Yep Ireland should default and start again.

 

Stop bailing out the banks.

[interestrateripoff]

http://www.independent.co.uk/news/business/analysis-and-features/debt-casts-shadow-over-main-street-as-budget-crisis-looms-2208586.html

 

No one would pretend that this is a period of smooth sailing for the US, but optimists would tell you that the world's largest economy successfully navigated through the storms of the sub-prime debt crisis, while a federal government debt crisis, despite ongoing deficits, remains largely over the horizon. Except, could this be an iceberg right in front of us?

 

The prospective debt crisis that has everyone scurrying for their lifejackets now is not in the banking system, nor at the level of the federal government, but in state and local government in the US.

 

Of the 50 states, only a number in single figures are likely to have budget surpluses in the coming financial year, causing concern about their ability to meet interest payments on their debt. And below the state level lie thousands of counties, cities and other local authorities whose finances have been tossed around by the economic tempests of the past few years. Tax revenues are depressed and the money that they get allocated from the state government looks sure to be squeezed as states themselves try to face up to their budget problems.

 

Across these thousands of municipalities, some $2.8trillion of debt is outstanding. Privately, the most senior Obama administration officials accept that not all of it is going to be paid back. And in public, one of the most famous and most feared analysts on Wall Street is going round predicting between 50 and 100 defaults and a big surge in the interest rates that local governments will have to pay in the future.

 

That analyst is Meredith Whitney, who was out in front predicting crisis in the US banking sector back in 2007. Now, she says, there is a whole new crisis coming in municipal finances and it threatens to knock the economic recovery right off track. Her comments have provoked fury. She has been accused of ignorance and, worse, of willfully exaggerating the problem to win business for her new firm. And her critics warn she is causing the very problem she predicted, because she is scaring away the conservative private investors who traditionally buy municipal bonds.

 

"It has tentacles as wide as anything I've seen," Ms Whitney told the prime-time news show 60 Minutes in December. "I think next to housing this is the single most important issue in the United States, and certainly the largest threat to the US economy."

 

And – in words that were chilling to hear for the risk-averse investors who have piled into municipal bonds since the credit crisis, seeing them as a safe and tax efficient way to beat record-low interest rates elsewhere – Ms Whitney went on to say financial advisers were being complacent to ignore the mounting concern. "When individual investors look to people that are supposed to know better, they're patted on the head and told, 'It's not something you need to worry about.' Well, it'll be something to worry about within the next 12 months," she said.

 

Not everyone agrees. Peter De Groot, at Barclays Capital, says: "Municipal defaults are expected to remain low despite the difficult budget environment, as states have demonstrated the willingness and ability to cut spending to offset structural imbalances. Public entities plan to spend and borrow less and have implemented policies to begin to address longer-term pension and healthcare liabilities."

 

More at the link.

 

It would appear we won't have to wait too long to find out who's correct although I'm sure the Ben Bernanke will get the printer whirling at 150% to try and save the day.

[interestrateripoff]

http://www.telegraph.co.uk/finance/economics/8314582/QE-safeguarded-3m-American-jobs-says-Federal-Reserve-chief-Ben-Bernanke.html

 

The Federal Reserve's quantitative easing (QE) programme may have safeguarded 3m jobs in the US, Ben Bernanke told Congress, as he also sought to dismiss concerns about the threat of inflation.

 

The central bank's chairman said that recent work research at the Fed suggested that the two rounds of QE – or printing money – done by the Fed since the financial crisis have provided real support to the country's jobs market. However, he cautioned that drawing direct links between the policy and specific job creation is never straightforward

 

Mr Bernanke's appearance on Wednesday before the Budget Committee was his first before Congress since November's mid-term elections saw Republicans seize control of the House of Representatives. Paul Ryan, the chairman of the committee and one of the most outspoken critics of the second, $600bn (£370bn) round of QE, repeatedly questioned Mr Bernanke over whether the Fed's policies are stoking inflation in the US and threatening the value of the dollar.

 

"There is nothing more insidious that a country can do to its citizens than debase its currency," said Mr Ryan, who as chairman of the committee will play a key role in how Washington eventually tackles the country's deficit.

 

The Fed chairman insisted that inflation is not a problem in the US, but that the bank would review its current programme of QE – scheduled to finish in June – should a faster economic recovery lead to a sharp rise in prices.

 

The second round of QE, which the Fed embarked on in November to fire up the recovery, has proved particularly controversial. Critics claim it will inevitably lead to inflation and do nothing to cut unemployment.

 

The jobless rate has tumbled from 9.8pc to 9pc in the past two months, but Mr Bernanke cautioned that it will take much longer for the unemployment level to fall back to around 5pc.

 

"It will be several years before the unemployment rate has returned to a more normal level," he told the committee. The unemployment rate has been above 9pc since May 2009, the longest streak above that level since records began just after World War Two.

 

However, he did strike a more optimistic note on evidence that the recovery is becoming more self-sustaining as consumer spending and business spending picks up.

 

How can the recovery be self-sustaining every time the economy falters Ben you rush in and pump more free money into the system to boost "growth".

 

I love the claim he's saved 3m jobs, Ben is that 3m jobs saved permanently or just temporary until the sugar rush wears off?

[interestrateripoff]

http://www.nytimes.com/2011/02/10/business/10mortgage.html?_r=1&ref=business

 

Banks have been fighting with disgruntled bond investors and insurers for months, arguing that they do not need to buy back soured mortgages they placed inside securities before the financial crisis.

 

Now, it turns out, some of those banks may have secretly collected partial payments on those same mortgages several years ago and pocketed that money.

 

At least that is a theory being pursued by plaintiffs’ lawyers in some of the largest mortgage bond lawsuits, in which banks are accused of filling mortgage bonds with loans that did not belong there.

 

The theory surfaced in a recently unsealed lawsuit against a mortgage unit at Bear Stearns, the failed investment bank that is now part of JPMorgan Chase.

 

In the suit, the Ambac Assurance Corporation, which insured some mortgage bonds created by Bear Stearns, contends that the bank was partly compensated by loan originators for mortgages that became delinquent shortly after they were packaged into securities. Bear Stearns’s mortgage desk kept the payments, according to the suit, rather than apply them to the bonds that contained the delinquent loans.

 

Interviews with more than a dozen former workers at several big banks, including Lehman Brothers and Deutsche Bank, suggest that several banks received millions of dollars at a time in such payments, known as early-payment-default settlements.

But the money trail of these settlements is murky. It is unclear how much of the money was added to bankers’ profits — and bonuses — and how much was forwarded to buy out bad loans from mortgage bonds.

 

Whether or not the settlement payments were shared with mortgage investors, they are likely to be used in court to show that Wall Street banks knew about the growing stream of mortgages that had missed payments within their first 90 days, a common sign of mortgage fraud. That sort of evidence may matter to government investigators at places like the Securities and Exchange Commission, which is looking into whether banks misrepresented the sorts of mortgages placed in bonds.

 

At Bear Stearns, there seems to have been some knowledge of the failing loans, according to the Ambac case. Ambac says there is evidence of more than 100 early-default settlements for batches of loans that soured quickly. An example in that case describes an $11 million payment for one batch of loans. For another batch of “at least 12 loans,” there was a $2.6 million payment.

 

Ambac’s case was filed in federal court, but a judge there ruled this week that the case belonged in a different jurisdiction. Erik Haas, a lawyer for Ambac, said the company planned to refile in state court.

 

JPMorgan Chase, which bought Bear Stearns three years ago, said Ambac was a sophisticated investor that knowingly took risks in its deals.

 

“We do not believe Ambac’s claims are meritorious and intend to defend Bear vigorously,” said Jennifer Zuccarelli, a JPMorgan spokeswoman. Ms. Zuccarelli would not comment on Bear Stearns’s use of settlement payments.

 

More at the link.

 

The system just appears to be getting more and more corrupt. Considering the sums invested if the courts go against the banks, do these institutions have the money to pay out? Could we see the banks start suing the bankers who got the bonuses on these deals in an effort to get the money back?

 

Still I'm sure this only happened for a small number of cases.

[interestrateripoff]

http://www.zerohedge.com/article/30-year-fixed-rate-mortgage-hits-505-highest-april-2010

 

To those who look for confirmation of the wealth effect in every nook and cranny, better keep looking away from housing. The 30 Year Fixed Rate mortgage, that indicator of just how much "piggy bank" value US housing has, just jumped by a whopping 24 basis points in the last week to 5.05%, the highest since April 2010. And as the observant ones will point out, it was in April of last year, when the market topped out after hopes and dreams of a self-sustaining economic recovery collapsed (with Europe lending a helping hand in the process), leading to QE Lite and QE 2 several months later. In other words, in the last 2 months, housing, at least that part that has a mortgage associated with it, has lost roughly 10% of its value as incremental purchasing power has just declined by the same amount courtesy of the spike in rates. In spiking the market, Ben has once again planted the seeds of his own monetary policy destruction.

 

More at the link.

[interestrateripoff]

http://ftalphaville.ft.com/blog/2011/02/10/484536/portugal-unmoored/

 

http://www.forexcrunch.com/portugal-bailout-closer-as-ecb-stops-buying-bonds/

 

The yields on Portugal’s’ bonds are breaking records, above 7.5%. This can be “blamed” on the European Central Bank, that didn’t buy any bonds in the past two weeks. Without the support of Jean-Claude Trichet, money becomes very expensive for Portugal. The high lending levels are unsustainable in the long run, and may force an intervention.

 

At the beginning of the year, there were talks about a bailout for Portugal – a Franco-German effort to convince Portugal to take the bailout in order to save Spain from the same fate.

 

.......

 

Update: Well, the ECB woke up and returned to buying bonds – yields fell from a peak of 7.63% to 7.43% at the moment.

 

The entire financial system is on life support of central bank intervention. They are trying everything to avoid a collapse.