The great interest rate rip off part 1

[interestrateripoff]

http://www.guardian.co.uk/business/2010/nov/16/germany-balks-at-ireland-bailout

 

"The Celtic tiger is gasping for breath," declared a commentary this week in the German daily Die Süddeutsche, which highlighted the fear of many in Europe's largest economy that it will be the one that will have to provide the emergency oxygen.

 

That Germany will have to step in is now not in much doubt, despite denials from Ireland that it needs the help. The question being asked is precisely how much of the burden Germany would be expected to bear.

 

German taxpayers are still smarting from the multibillion-euro Greek bailout in May, which led to ugly headlines in the mass-market Bild about excessively profligate Greeks and how frustrated Germans were cancelling their holidays to Crete in protest at having to pay for their fellow Europeans' unchecked excesses.

 

Six months on, anger towards Ireland is not yet as acute, but there is growing unease about the idea of Germany having to pay yet again for a fellow European country, particularly one whose per capita annual income is around €34,000 – more than Germany's €30,000.

"The poor Germans are going to have to feed the rich debtors," wrote Die Welt, in an analysis whose acerbic undertones were only thinly disguised.

 

Anger is also being stoked by the growing protests from Irish and Greek leaders that Chancellor Angela Merkel has spooked the bond markets and caused a huge rise in the borrowing costs of Ireland and Portugal with her repeated suggestions that the markets and banks that financed high national debts should be forced to carry the cost of eventual defaults – not the taxpayer.

 

Clearly the taxpayer must bear the costs, if the banks do where are the bonuses going to come from. Losses should never be on the banks books, they should be absorbed by the taxpayer.

[interestrateripoff]

http://www.guardian.co.uk/business/2010/nov/17/ireland-debt-crisis-bail-out

 

Financial hit squads from the International Monetary Fund, the European Central Bank and the EU will be parachuted into Dublin within days to finalise details of a multibillion-euro bailout for the stricken Irish economy, it was revealed last night.

 

Prospects for an emergency package of help – part bankrolled by Britain – moved a step closer after a day of tense negotiations between finance ministers from the 16-nation eurozone.

 

With Ireland still holding out against a bailout for now, the experts will be sent in a fresh attempt to calm markets after yesterday's volatile trading ahead of the Brussels meeting. George Osborne was travelling to Brussels last night for a meeting of the wider EU group amid mounting speculation that the UK would be expected to contribute at least £7bn to any Irish bailout. There were also suggestions that Britain would extend bilateral loans to stabilise Ireland's banking system.

 

After the Brussels talks – which started one and a quarter hours late because Ireland's finance minister, Brian Lenihan, was stuck in traffic – Dutch finance minister Jan Kees de Jager revealed the decision to assemble the assessment team.

 

"We will follow developments and then we have a look ... and if it is necessary, the mechanism is ready. If there is an application from any country, the mechanism is ready," de Jager said.

 

 

Yeah we are all going to be saved now, experts who probably failed to predict this crisis are going to be parachuted in to save the day.

 

No doubt we can expect an Irish denial about the talks in the coming days.

[interestrateripoff]

Upsized GM IPO could be biggest U.S. deal ever

 

General Motors Co GM.UL is boosting the size of its common stock offering by more than 30 percent to $15.5 billion (9.7 billion pounds), two people familiar with the matter said, potentially making its landmark IPO the largest U.S. offering ever.

 

The expansion comes in response to surging demand from investors, who had put in orders worth $70 billion for GM's common shares by late on Tuesday, the sources said.

GM's initial public offering, which will reduce the U.S. Treasury to a minority shareholder in the top U.S. automaker, could raise nearly $23 billion if underwriters exercise the full overallotment option on both common and preferred shares.

 

The deal could also pay back over $15 billion to the U.S. government, assuming that shares price at the high end of the range and all of the common stock on offer is sold.

 

That would take the Obama administration closer to break-even on a still controversial bailout that some critics had predicted would be a financial quagmire for taxpayers.

 

The largest U.S. IPO to date was Visa Inc's (V.N) $19.7 billion stock sale in 2008.

 

Demand surging, is this from the free money Bernanke is printing?

 

Wow $15bn to be paid back to the govt, that will help reduce $1tr plus deficit this year.....

[interestrateripoff]

http://uk.finance.yahoo.com/news/UK-pledges-7bn-help-bail-tele-2434271876.html;_ylt=AojR1KmG5Sw3d13aSG1ZY1bSr7FG;_ylu=X3oDMTE4Z3U3czV0BHBvcwMyBHNlYwN5ZmlUb3BTdG9yaWVzBHNsawN1a3BsZWRnZXM3Ym4-?x=0

 

George Osborne has pledged British support of up to £7bn for an EU bailout of Ireland (Berlin: IIK.BE - news) and its banking sector.

The Chancellor arrived in Brussels for a meeting of EU finance ministers aware that exposure of British financial institutions to Irish banks is £140bn.

“Ireland is our closest neighbour. And it's in Britain's national interest that the Irish economy is successful and we have a stable banking system,” he said. “Britain stands ready to support Ireland.”

Britain is not part of the 16 member eurozone but is a member of a £51bn “European Financial Stabilisation Mechanism” that will be used to aid Ireland.

 

Just remember it's contained....

[Spit]

[interestrateripoff]

Breaking news

 

• 
  
• Air France-KLM ups target as traffic recovers - Reuters
  
• Suntech profit misses Wall St view, shares slump - Reuters
  
• Investors clamor for GM shares but supply thin - Reuters
  
• Investors clamor for GM shares but supply thin - Reuters
  
• US STOCKS-S&P, Nasdaq edge up on retailers, but Europe weighs - Reuters
  
• Target sees holidays boosting sales to 3-year high - Reuters
  
• World farming to get $200 mln in climate aid - Reuters
  
• European shares rise on firm pharmas; Actelion soars - Reuters
  

 

 

 

• George Osborne – UK will help Ireland through debt crisis
   
  Chancellor vows to help restore stability to Ireland's banking system as European finance ministers gather for crunch meeting
  284 comments
  
  • Ireland's debt crisis - live coverage
    
  • Experts to be parachuted in to finalise bailout
    
  • Who are the 'bond vigilantes'?
    
  • Crisis could cause EU collapse, warns president
    
  • Ireland told: Take EU bailout or trigger crisis
    
  • Irish crisis worsens as Portugal warns of contagion
    
  • Ireland rides to defence of low tax regime
    
  • Nils Pratley: Eurozone's big boys hold the aces
    
  • Who caused Ireland's banking crisis?
    

  [*] What it's like to live with the IMF

   

  Lisa O'Carroll's blog: As a team from the IMF heads to Dublin, a former Argentinian economics minister describes what life was like

  37 comments

  • Ireland v the world: Geopolitical hardball
    
  • Germans balk at second euro bailout
    
  • TV resignation hoax causes further anguish
    

  [*] Lovely jubbly: market traders offered a helping hand

   

  Would-be entrepreneurs are to be given tips on how to prevent their ventures folding in the early weeks of business

 

 

• UK unemployment falls unexpectedly
   
  The ONS says claimant count fell 3,700 in October – its first monthly fall since July
   
  291 comments
  
  • Unemployment: what the experts say
    
  • Industrial blackspots hit by 18% unemployment
    
  • What's the real number of jobless people in Britain?
    
  • The public sector employment map of Britain
    
  • The unemployment map of Britain
    
  • Benefit claimants constituency by constituency
    

  [*] Drug companies 'profiteering from NHS'

   

  Consultants and patients' group calls for inquiry into firms' alleged repackaging of drugs for rare diseases

  [*] More business news

  [*] HSBC doubles salaries

  131 comments

  [*] Glitnir investigators raid 16 homes

  [*] Food prices may rise by up to 20%, warns UN

  44 comments

  [*] EasyJet to pay out first dividend

  [*] King issues inflation warning for 2012

[interestrateripoff]

The human cost of the Irish crash

 

They stand empty across Ireland: 300,000 unoccupied homes, a silent reproach to those who thought the economic boom would never end.

 

• ITV fights back as advertising rebounds
  
• 370 Suits You jobs to be axed new
  
• Bank urged to remain calm as inflation rises
  
• DIY chain Focus looks to sell off stores to raise funds
  
• Burberry fashions record half year profits
  
• Millions of savers have no choice but to lose money
  
• Asda promises to create 7,500 new jobs
  

 

David Prosser: Bolton's faith in Chinese consumers points to the future of global economy

 

 

Outlook It may annoy those who enjoy seeing the stars being brought down to earth with a bump, but Anthony Bolton is up to his usual form with his new investment venture, Fidelity China Special Situations.

 

• Ian Burrell: As a new advertising dawn breaks, ITV stands ready
  
• David Prosser: Rethink policy on VAT before we hit a trough
  
• David Prosser: Crozier and McCall have been on easy street
  
• David Prosser: The £7bn cheque that is set to give Osborne nightmares
  
• Mark Leftly: Network Rail fails to account for Potters Bar
  

 

Stephen Foley: Republicans take aim in battle to sink the Fed's QE2

 

Right-wingers on Capitol Hill want to end the US central bank's mandate to combat unemployment

 

• Third time unlucky as BHP drops $39bn bid for Potash Corp
  
• The Business on: Robert Wiseman, Chairman, Robert Wiseman Dairies
  
• M&S's U-turns: Will the latest plans last?
  
• Argh, me hearties, here be treasure!
  
• Losing the magic: How Euro Disney became a nightmare
  

[interestrateripoff]

Claimant count falls unexpectedly in October

 

LONDON (Reuters) - The number of Britons claiming unemployment benefit fell last month for the first time since July, but analysts said government spending cuts mean it may not be long before it starts rising again.

Continue Reading

 

 

 

EU/IMF team heads to Ireland to explore crisis steps

 

DUBLIN/BRUSSELS (Reuters) - Ireland agreed on Wednesday to work with a European Union-IMF mission on urgent steps to shore up its shattered banking sector, a process that could lead to a bailout despite Dublin's deep reluctance. | Video

5:53pm GMT

 

Bank's Tucker says economy improved in recent months

 

LONDON (Reuters) - Parts of Europe are experiencing difficulties but Britain's economy looks in better shape now than it was a few months ago Bank of England Deputy Governor Paul Tucker said on Wednesday.

5:55pm GMT

 

FTSE gains and Experian jumps after results

 

LONDON (Reuters) - The top share index closed higher on Wednesday, led up by Experian after robust first-half results, while strength was seen among banks which have been weighed down by concerns over Europe's debt problems.

5:41pm GMT

 

LCH.Clearnet doubles margin requirement on Irish debt

 

LONDON (Reuters) - European clearing house LCH.Clearnet has doubled its margin requirement on Irish government bonds to 30 percent of net positions, citing higher Irish yields over triple-A benchmarks such as German debt.

3:05pm GMT

 

James Murdoch warns UK not to snub BSkyB investment

 

BARCELONA, Spain (Reuters) - James Murdoch said the government must decide to back News Corp's 7.8 billion pound bid for BSkyB or risk losing its investment in the "world leader" digital TV operation.

1:48pm GMT

 

GM boosts IPO size to reduce U.S. government stake

 

DETROIT/NEW YORK (Reuters) - Riding a wave of investor demand, General Motors Co's landmark stock offering is now set to raise as much as $22.7 billion (14.2 billion pounds), allowing the U.S. government to drastically cut the controlling stake it acquired when taxpayers rescued the iconic automaker in 2009.

5:26pm GMT

 

Trade ties bind Britain closely to Ireland's fate

 

LONDON (Reuters) - Neighbouring Ireland remains one of Britain's largest export markets despite efforts to woo the big emerging economies, a factor that could draw the British into efforts to prop up the Irish economy.

UK, David Cameron 4:59pm GMT

 

Bank split 3 ways in November, majority still on fence

 

LONDON (Reuters) - Bank of England policymakers split three ways again in November, with the majority standing ready to move policy in either direction, boosting expectations of no change in the monetary stance for some time to come.

UK 12:45pm GMT

 

Ryanair will move more operations to meet demand

 

DUBLIN (Reuters) - Ryanair , Europe's largest low-cost carrier, will continue to respond to tax hikes and unfavourable investment regimes by moving its assets around, its new route development director said on Wednesday.

[interestrateripoff]

http://uk.reuters.com/article/idUKTRE6AG3XO20101117

 

Parts of Europe are experiencing difficulties but Britain's economy looks in better shape now than it was a few months ago Bank of England Deputy Governor Paul Tucker said on Wednesday.

 

"The world is still a hazardous place and there are obviously difficulties around Europe. But I think the UK is in a better position now than perhaps it was a few months ago," Tucker told BBC Radio Oxford.

 

Tucker said action to reduce Britain's budget deficit had also taken away some risks.

 

"The action that has been taken to put the UK public finances on a better footing over the next few years provides some insulation for our economy," he said.

 

Delusional?

 

If someone has reduced public and private sector debt I would feel that we are in a far better position but whilst we are still over leveraged it's hard to see how our position is better.

[interestrateripoff]

17 November 2010 Last updated at 17:52

 

EU downplays Irish bail-out talks

 

European finance ministers say they did not hold detailed discussions on a potential bail-out for the Irish Republic at a meeting in Brussels.

 

• Global banks set to avoid Irish losses
  
• Q&A: Irish crisis
  
• Europe's bad debt 'dominoes'?
  
• EU 'ready' to bail out Irish Watch
  
• Press review: Irish rescue plans
  

 

UK unemployment sees slight fall

 

UK unemployment falls slightly in the three months to September, but the unemployment rate remains unchanged at 7.7%.

 

 

 

• China introduces food subsidies
   
  China's government takes steps to tackle food shortages and inflation, as the stock market tumbles on fears of rate rises.
  
• Russia checks $4bn pipeline theft New
   
  Russia is checking papers that suggest some $4bn (£2.5bn) of state funds was stolen during the building of a big oil pipeline.
  
• GM set for record share sale
   
  Strong orders let carmaker GM raise the size of its initial public offering of shares, positioning it for a record US sale.
  
• Police investigate currency firm
  
• US inflation moves closer to zero
  
• BP gas field shut down over Iran
  
• Three-way split on MPC continues
  
• New checks on estate agents begin
  
• Northern Foods up 24% on merger
  
• Centrica criticised over profits
  
• Drug firm Roche to cut 4,800 jobs
  
• Paddy Power outgrows home market
  
• Scottish budget cuts are unveiled
  
• Welsh draft budget cuts revealed
  
• Rotherham claims enterprise gong
  

Counting the cost

 

The potential impact of the Irish debt crisis on international banks

[interestrateripoff]

[/url]

 

 

Ireland resists bail-out as UK pledges £7 billion

 

Ireland punished by markets as it resists pressure for aid and horse trading begins on a debt rescue.

Ireland's debt crisis in pictures

 

 

Ireland bailout: the likely options

 

 

 

 

Jobs data provide solace as rate divide deepens

 

Unemployment has fallen unexpectedly in the UK as Bank of England policymakers remain split three ways on what to do with interest rates.

Hawk v Dove - the MPC dilemma

 

 

Best and worst universities for graduate jobs

 

 

 

Northern Foods to merge with Greencore

 

Northern Foods, which makes own-label food for UK retailers from Marks & Spencer to Aldi, is to merge with Greencore, the Irish company that is one of Britain's biggest sandwich and ready-meals makers.

 

BP shuts North Sea field over Iran ban

 

 

 

 

King tells Britain to brace for more high inflation

 

 

 

 

Police probe Crown Currency Exchange

 

 

 

 

Rothschild deal creates Indonesian coal giant

 

 

 

 

Fed denies QE is 'chapter in a currency war'

 

 

 

 

General Motors' IPO to be second-biggest in US history

 

 

The euro politicians who will decide Ireland's fate

 

Ireland’s fate now rests in the hands of a cadre of powerful European politicians.

Ireland's debt crisis in pictures

 

 

 

 

What the Bank of England's MPC minutes reveal

 

 

 

 

Ireland's Finance minister Brian Leniham on debt crisis

 

 

Renting a home is more expensive than buying one

 

Renting a home is more expensive than buying one in 80 per cent of British towns, new figures have revealed.

Peak in number of part-time workers

 

 

UK unemployment by numbers

 

Graphs tracking job trends, including long-term unemployment, the number of men and women in work, youth joblessness, and claimant count.

BoE to reveal deep division, as jobs data loom

 

 

 

 

Best and worst universities for graduate jobs

 

 

 

 

Claimant count set to reach 1.5m

[interestrateripoff]

A New G.M., but Not an End to the Bailout Era

 

By ERIC DASH and NELSON D. SCHWARTZ

 

General Motors’ stock offering is a milestone, but Washington is still contending with other costly rescues.

 

• G.M. Expands I.P.O. by 31%, Further Cutting U.S. Stake
  

Jeff Kowalsky/Bloomberg News

 

The General Motors initial public offering is expected to raise at least $16 billion.

 

 

 

Britain Signals Intention to Help Ireland in Debt Crisis

 

By JAMES KANTER and STEVEN ERLANGER 10:00 AM ET

 

Britain said on Wednesday that it could offer assistance, as the prospects for a European bailout increased at a meeting of finance ministers.

 

• Stocks Steady as Investors Watch Europe 1:02 PM ET
  
• Post a Comment | Read (62)
  

 

Stocks Steady as Investors Watch Europe

 

By THE ASSOCIATED PRESS 27 minutes ago

 

Markets were little changed after four days of declines as talks on an Irish bailout continued.

 

China Acts to Slow Rise in Food Prices

 

By KEITH BRADSHER 9:49 AM ET

 

Beijing is preparing measures to rein in double-digit rises in food prices in an effort to control surging living costs.

 

Currency Fight With China Divides U.S. Business

 

By DAVID BARBOZA

 

American businesses that import Chinese goods face higher prices, but exporters are predicting sales growth.

 

• Obama Sails Churning Trade Sea, Where Friends Are Foes
  

 

U.S. Consumer Prices Tame in October

 

By CHRISTINE HAUSER 12:07 PM ET

 

The monthly increase was less than expected, and the annual rate, excluding food and energy, was the lowest on record. Housing starts slumped.

 

DealBook

 

Dynegy Postpones Vote on Blackstone Takeover Bid

 

By MICHAEL J. DE LA MERCED 17 minutes ago

 

Dynegy delayed the shareholder vote on its proposed takeover by the Blackstone Group until next week, saying investors needed time to evaluate the latest offer.

 

Prescriptions Blog

 

Cholesterol Drug Shows Promise

 

By NATASHA SINGER 10:16 AM ET

 

An experimental treatment using anacetrapib appeared to reduce bad cholesterol, but larger studies are needed to assess the effects.

 

F.D.A. Panel Backs Drug for Lupus

 

By ANDREW POLLACK

 

Benlysta would be the first approved drug to treat lupus in decades.

 

Republican Proposal Takes Aim at Fed’s Dual Role

 

By SEWELL CHAN

 

Those who backed the proposal said that the Fed should stop trying to balance both inflation and unemployment.

 

Boeing and Airbus Waver on Reworking Their Smaller Jets

 

By CHRISTOPHER DREW and JAD MOUAWAD

 

Airlines want more fuel-efficient versions of the 737 and A320, but the planes’ makers are looking to new aircraft.

 

 

 

• Roche Takes Knife to Costs, Slashes 4, 800 Jobs 6:57 AM ET
  
• A Footnote Explains a Dispute Over Treasury’s Bailout Figures
  
• Square Feet: Frank Gehry (a Part Owner) Helps Develop a Landmark
  
• BP and Minerals Agency Faulted in Gulf Spill
  

[interestrateripoff]

CPI: Where Are My Zero-Inflation Eggs?

Here's the headline...

The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in October on a seasonally adjusted basis, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index increased 1.2 percent before seasonal adjustment.

This is amusing, really. Especially this claim:

The food index has risen 1.4 percent, with both the food at home index and food away from home index rising the same 1.4 percent.

If you believe that, I've got a bridge to sell you.

 

More at the link.

[interestrateripoff]

I Chris Whalen

But not in a gay sort of way....

“There’s a lot of losses in the system that investors haven’t seen yet,” he tells Henry in this clip. “All the industry is willing to do is admit to as much loss as they have cash flow, this quarter,” something banks are allowed to do now that the mark-to-market accounting rules have been removed.

Compounding the problem is a low interest rate environment that is becoming less beneficial to banks. Whalen says net interest rates margins are shrinking – meaning the spread between the rate banks borrow at and the rate they collect on their loans is shrinking, as older loans expire or get refinanced.

The big problem here is as I noted back in 07 and so have a few other people (including Chris) - Heloc and other loans that are being held under false valuations will eventually have to be recognized at the impaired (or worse) value that they have.

The entire point of things like QE2 is to find ways to give the banks the ability to steal some more money to try to paper over the hole - in this case off the spread in the transactions. But every dollar you take from someone to paper over a loss someone else doesn't get to keep.

Listen to the little video clip - Chris details exactly what's coming in terms of the Pension Funds and others who depend on fixed income. While ZIRP sounds good from a so-called "policy" perspective it totally screws any institution or person who is reliant on the ability to earn a return on their capital.

The din of the approaching tornado is getting louder and louder.....

[interestrateripoff]

Here We Go Again: AIG Part Deux (Ambac)

This really gets old, especially when the lies continue on a literal daily basis....

This week in

The Institutional Risk Analyst

, we return to the financial travails of

Ambac Financial Group ("AFG"),

which recently filed bankruptcy after several years of twisting in the wind due to questions about solvency related to RMBS exposures. AFG, as it turns out, is the latest project of

Treasury Secretary Tim Geithner,

who wants to again protect the largest bank dealers and the market in over-the-counter derivatives from legal discipline.

What is IRA referring to?

Simple, really. Once again Tim Geithner is attempting to protect banks by finding ways to pay off their credit default swaps at par while creditors who have a privileged position at the front of the line get screwed - again.

Wisconsin insurance boss

Sean Dilweg

is clearly toeing the "team player" line set down by Geithner in the collapse of

American International Group (AIG),

namely always pay the banks and screw the bond holders and the taxpayer. In this case the taxpayers are the good people of Wisconsin. Will AFG's insurance business really survive under this allegedly "optimal" rehabilitation plan proposed by Mr. Dilweg?

It looks to us like he and Geithner are cherry picking the remains of AFG's assets to pay the bank CDS counterparties

and leave the sinking ship for the WI state insurance fund to clean up a couple of years hence.

Nice.

So once again we have government officials interfering where they have no business being for the explicit purpose of bailing out the banks - while leaving those who bought insurance on the RMBS (that would be pension funds, including quite possibly yours!) to twist in the wind a couple of years from now when the money is all gone.

Anything new here? Uh, no.

"Change"?

That's all you're going to have left when these thieves get done with you.

 

The taxpayer always gets to pick up the tab. Taxpayers are a bottomless pit.

[interestrateripoff]

http://www.zerohedge.com/article/hinde-capital-what-do-when-there-no-debt-jubilee

 

A whopping 55 page presentation from Hidne Capital summarizing the key legacy dynamics of the credit boom, and what the future holds.

Debt: there is no jubilee (pdf)

[interestrateripoff]

http://www.zerohedge.com/article/knight-research-stunning-call-game-over

 

The Game Is Over

The simple story is this: We believe the structural and cyclical terms of global trade have finally reached their tipping point. This will catalyze a wholesale change in sentiment and a historic repositioning of risk assets. The emerging market global growth story is over.

 

• In meetings with clients throughout October, we began emphasizing our growing concerns about the nearly ubiquitous confidence the financial markets—and for that matter, global leaders and their body politic—have in China; and by extension, the rest of the emerging market story, commodities, and the direction of foreign exchange cross-rates.
  
• Not surprisingly, our concerns were met with varying degrees of resistance; but the overall consensus clearly favored a very bullish, asymmetric outcome over both the near and intermediate terms. When pressed as to our own sense of timing and specific catalysts for broad-based trend reversal, candidly we were unclear. Our sense then, was that the higher and faster the commodity markets pushed, the sooner the reversal would occur. But we have now clarified our view.
  
• In just the past several weeks, we believe the data and government actions out of China, the back-up in US interest rates, the Fed’s emphatic commitment to QE2, intensifying pressures across the EU, broadly rising commodity prices, government efforts to control hot money flows, have finally pushed the global terms of trade to their tipping point.
  
• And now, as is evident by the flight to safety, and growing evidence that China will soon try and effect price controls in addition to raising interest rates and significantly changing the rules for their vast network of Local Government Funding Vehicles (LGFVs); the writing is on the wall. The game is over.
  
• The simple story is this: The structural and cyclical terms of global trade have reached their tipping point which will effect a wholesale change in sentiment and a historic repositioning of risk assets.
  
• So what do we consider the “terms of global trade”? Structurally, per our top chart, they are the intersection of Government Policy (viz., rule of law, market systems, trade law, etc.,) Resource and Industry (viz., natural resources, labor/demographic pools, industrial advantages, import dependencies, etc.,) and Economic Security (viz., the sovereign’s competitive standing, the relative power/needs of the citizenry, the mandate/control of the government, etc.) And cyclically, (as represented by the light blue, bold arrows) the terms of trade are defined by the intersection of foreign exchange rates, commodity prices, and the cost and availability of trade finance.
  

 

• And in our assessment given:
  

 

1. The structural breakdown of the credit and labor markets in the developed world and the anemic outlook for nominal GDP growth
   
2. The immaturity of the developing world and their vulnerability to credit shocks and uncontrollable inflation
   
3. China’s dependence upon non-economic, and unsustainable credit expansion to maintain growth far beyond natural export and domestic demand, and
   
4. Asia’s dependence upon imported energy and agriculture
   

the game is over. Presently, we believe that the broad-based resurgence of investor confidence in the emerging market and secular bull market in commodities will end badly; proving that the rally which commenced in Q2 2009, was in fact an “echo bubble” facilitated by massive—and unsustainable—stimuli from the Chinese Government

 

• And although such cataclysmic shocks rarely result in rhythmic, straight line fractures, the chain of price adjustments should be relatively clear. Accordingly, we expect a shockingly powerful rally in the dollar, broadbased weakness across the commodity sector, a dramatic widening of emerging market credit spreads, and what could prove to be a stampede of hot fund flows out of the emerging markets.
  
• We appreciate both the gravity and the brevity of this note; but then again, the story is simple.
  

We believe that the end of the Great Consumer Credit Cycle and the vast structural differences in the terms of trade between the United States, the EU, and China, have finally caught up with the secular bull thesis on Emerging Market and Commodities. Quite ironically, the Fed’s aggressive policies will likely prove to be the catalyst which breaks China’s unbridled expansion of credit and non-economic growth, ushering in a wholesale rebalancing of risk assets.

[interestrateripoff]

http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100008667/the-horrible-truth-starts-to-dawn-on-europes-leaders/

 

The entire European Project is now at risk of disintegration, with strategic and economic consequences that are very hard to predict.

In a speech this morning, EU President Herman Van Rompuy (poet, and writer of Japanese and Latin verse) warned that if Europe’s leaders mishandle the current crisis and allow the eurozone to break up, they will destroy the European Union itself.

“We’re in a survival crisis. We all have to work together in order to survive with the euro zone, because if we don’t survive with the euro zone we will not survive with the European Union,” he said.

Well, well. This theme is all too familiar to readers of The Daily Telegraph, but it comes as something of a shock to hear such a confession after all these years from Europe’s president.

 

More at the link.

[interestrateripoff]

Breaking news

 

• 
  
• Fitch to review Ireland rating based on EU/IMF aid - Reuters
  
• FTSE up as Irish debt concerns ease; banks firm - Reuters
  
• Keydata founder urges UK govt to launch FSA probe - Reuters
  
• BoE's Posen says still favors more easing in UK - Reuters
  
• Bonds fall as Ireland, data prompt more unwinds - Reuters
  
• S.Africa lowers repo rate, room for more cuts limited - Reuters
  
• GLOBAL MARKETS-GM's IPO and US data lead to stocks' strength - Reuters
  
• US STOCKS-Wall St rallies on GM debut, Ireland optimism - Reuters
  

 

 

 

• Ireland has not surrendered sovereignty, says Cowen
   
  Last updated three minutes ago
  Taoiseach Brian Cowen rubbished accusations today that the government had surrendered Ireland's sovereignty
   
  
  • Bailout worth 'tens of billions', says Irish central bank
    
  • Central bank governor's interview in full
    
  • Nils Pratley: Another test for Ireland
    
  • IMF rides in as Osborne pledges aid
    
  • Who are the 'bond vigilantes'?
    
  • Q&A: What if I've got money in an Irish bank?
    
  • TV resignation hoax causes further anguish
    
  • Lisa O'Carroll: Ireland 'shamed' by arrival of IMF
    

  [*] Ireland's debt crisis - live coverage

   

  Live The governor of Ireland's central bank has predicted that it will accept a 'large loan', as IMF officials fly into Dublin

  64 comments

  • Latest “5.14pm: Brian Lenihan, Ireland's finance minister, has made a frank admission that there are "very big isues" in the country's banking sector…”
    Ireland's debt crisis - live coverage
     
    

  [*] OECD cuts UK economic growth forecast

   

  Organisation for Economic Co-operation and Development says the government's deep spending cuts will increase the 'headwinds' facing the economy

  102 comments

  • UK retail sales show signs of recovery
    

 

 

• 50% of Airbus Rolls-Royce engines need replacing, says Qantas
   
  After explosion, Trent 900s are stripped from new aircraft on production line to keep airline planes flying
  
• Osborne backtracks on City reforms
   
  Chancellor forced to reverse plan to give economic crime agency power to prosecute insider dealing
   
  
  • Chancellor's regulatory rethink should go further
    

  [*] Northern Foods and Greencore to merge

   

  Merged entity, to be known as Essenta, will supply about a third of all ready meals and sandwiches in UK supermarkets

   

  • Nils Pratley: Northern no more
    

  [*] More business news

  [*] GM increases IPO as demand surges from Asia

  [*] Capita shares fall as government cuts bite

  1 comment

  [*] Glaxo edges close to FDA approval for lupus drug

  [*] Betfair loses legal case in Australia

[interestrateripoff]

Climate change and disease will spark new food crisis, says UN

 

Sean O'Grady: A food crisis could overtake the world in 2011, according to the Food and Agriculture Organisation, an agency of the United Nations.

 

• Economic crash to drive 100,000 out of Ireland
  
• Retail sales pick up ahead of VAT rise
  
• 40 engines need to be replaced on A380s, says Qantas
  
• Unemployment falls but Britain is now part-time
  
• Asda's ambitions on hold as non-food chain falters
  
• Northern Foods to merge with Greencore
  
• MPC remains split over best rates policy for the economy
  

 

David Prosser: Ireland's defiant stand against a bailout shames the bullies in the eurozone

 

 

Outlook One can't fail to be impressed by the stubbornness with which the Irish have resisted the efforts of their eurozone partners to force them to ask for a bailout they do not want and believe they do not need.

 

• David Prosser: No easy answers on bandwidth charging
  
• David Prosser: Flat Earthers take note: deflation is the enemy
  
• David Prosser: Bolton's faith in Chinese consumers points to the future of global economy
  
• Ian Burrell: As a new advertising dawn breaks, ITV stands ready
  
• David Prosser: Rethink policy on VAT before we hit a trough
  

 

How General motors came back from the brink

 

The largest share offering in US history begins today and marks the rebirth of the car-making giant

 

• Webcast: How to turn a market stall into a business
  
• Stephen Foley: Republicans take aim in battle to sink the Fed's QE2
  
• Third time unlucky as BHP drops $39bn bid for Potash Corp
  
• The Business on: Robert Wiseman, Chairman, Robert Wiseman Dairies
  
• M&S's U-turns: Will the latest plans last?
  

[interestrateripoff]

Home prices expected to be flat next year - Reuters poll

 

LONDON (Reuters) - The housing market will bear witness to more falls in prices as rising unemployment, severe government budget cuts and tough new mortgage rules chip away at buyer demand, the latest Reuters poll of analysts found.

Continue Reading

 

 

 

GM shares jump in post-IPO return to market

 

NEW YORK (Reuters) -General Motors Co shares gained as much as 9 percent on Thursday as investors bet that the top U.S. automaker can make a lasting recovery after repaying a big chunk of last year's government bailout with funds raised in a landmark initial public offering. | Video

4:41pm GMT

 

United Biscuits £2 billion sale opens up - sources

 

LONDON (Reuters) - The private equity owners of United Biscuits are opening up a possible 2 billion pound sale to new bidders after exclusive talks with a preferred suitor ended, people familiar with the matter said.

4:59pm GMT

 

Retail sales recover, borrowing hits October record

 

LONDON (Reuters) - Retail sales recovered in October after two months of declines but government borrowing hit another record high for the month, underscoring the need for tough fiscal retrenchment ahead.

UK 1:01pm GMT

 

Debris from Qantas A380 engine severed cables - memo

 

LONDON (Reuters) - Pilots struggled to shut down an engine on the Qantas A380 that made an emergency landing this month, because debris from the Rolls-Royce engine that broke up mid-flight severed cables.

5:06pm GMT

 

FTSE up as Irish debt concerns ease and banks firm

 

LONDON (Reuters) - The top share index closed higher on Thursday, boosted by banks on growing hopes for a deal to ease Ireland's debt crisis and by mining stocks which followed metals prices higher.

5:23pm GMT

 

Bank's Posen says still favours more easing

 

WASHINGTON (Reuters) - Bank of England policymaker Adam Posen said on Thursday he still believes further monetary easing would be appropriate given weak economic conditions in the United Kingdom despite opposition from his colleagues.

5:14pm GMT

 

Irish central bank expects EU/IMF loan; markets rebound

 

DUBLIN (Reuters) - Ireland's central bank chief said on Thursday he expected Dublin to receive tens of billions of euros in loans from European partners and the IMF to provide contingency capital for its shattered banks. | Video

David Cameron 4:00pm GMT

 

CBI factory orders balance rises in November

 

LONDON (Reuters) - Factory orders fell at a slower-than-expected pace in November, but manufacturers expect output growth to slow markedly in the months ahead, the CBI's monthly Industrial Trends survey showed on Thursday.

11:01am GMT

 

Special report - In the rough with SAC Capital

 

NEW YORK (Reuters) - Sam Evans may not have the most powerful or lucrative position in the hedge fund world. But his job at SAC Capital Advisors is one a lot of people, and not just financial industry types, would die for.

[interestrateripoff]

18 November 2010 Last updated at 17:17

 

Irish Republic 'to get bail-out'

 

The governor of the Irish Central Bank says he expects the Irish Republic to accept a "very substantial loan" as part of an EU-backed bail-out.

 

• Flanders: The stages of Ireland's grief
  
• Peston: The big uncertainties
  
• Q&A: Irish crisis
  
• Portuguese fear EU debt contagion
  
• Global banks set to avoid Irish losses
  

 

 

• GM shares jump on market return
   
  Shares in General Motors rise 7% on the first day of trading following the carmaker's record public share offering.
  
• UK borrows £10.3bn during October
   
  The UK government borrowed £10.3bn to plug the gap in the public finances in October, official figures show.
  
• 'Forty new A380 engines needed'
   
  Up to 40 Rolls-Royce engines on Airbus A380 superjumbos worldwide will need to be replaced, Australian airline Qantas says.
  
• Crime gangs may target festivals
  
• Mortgage lending 'still subdued'
  
• Osborne to give economic update
  
• Greece unveils austerity budget
  
• EU plans big farm budget changes
  
• Emerging markets lift SABMiller
  
• Car production rises in October
  
• Retail sales see sign of pick-up
  
• Arcadia targets overseas growth
  
• Paris Club cancels DR Congo debt
  
• National Grid profits surge 45%
  

 

 

• The big uncertainties
   
  Ireland's Central Bank governor is frank but there are huge unknowns
  
• The big bail-out
  
• Counting the cost
  

 

Irish woes

 

The stages of Ireland's grief

[interestrateripoff]

[/url]

 

 

Ireland denies 'surrendering sovereignty'

 

Irish PM Brian Cowen has dismissed claims over bail-out, as IMF and EU officials pore over its debt-ridden accounts.

Ireland opens door to IMF mission

 

 

Ireland's debt crisis in pictures

 

 

 

 

Sir Philip's profits rise as UK retail sales pick up

 

Sir Philip Green, the man behind Topshop and BHS, has given the UK high street a welcome fillip by posting higher sales and profits and underlining his cautious optimism for 2011.

Analysis: Retail sales boom will be 'short-lived'

 

 

 

Lenders deny 'crying wolf' over mortgage rules

 

Large numbers of people will be excluded from owning a home if strict new mortgage rules are introduced, warns the head of the Council of Mortgage Lenders.

 

GM shares jump as it returns in record $20bn float

 

 

 

 

Rolls-Royce may have to replace half of all A380 engines

 

 

 

 

Deficit target still in sight despite new UK borrowing high

 

 

 

 

Coalition U-Turn over FSA crime powers

 

 

 

 

Bank of America's Lehman asset grab 'brazen'

 

 

 

 

James Murdoch: block News Corp and we'll go abroad

 

 

UK retail sales rise: key statistics and economists reaction

 

British retail sales rose slightly faster than expected in October after two months of falls, the Office for National Statistics said on Thursday. Here are the key facts and views.

Ireland set to tap €80bn loan as it opens door to IMF mission

 

 

 

 

Rules and rhetoric are strangling the City

 

 

 

 

Massive restructuring of eurozone debt now inevitable

 

 

GM shares jump as carmaker returns to the stock market in $20bn float

 

General Motors shares climbed more than 6pc within minutes of the opening bell ringing on Thursday, marking a remarkable return to the stock market for the US carmaker.

Halfords posts 13pc profit rise as cost savings offset sales dip

 

 

 

 

Emerging markets push up SABMiller sales

 

 

 

 

Oxford Street rents soar as demand for retail space rebounds

[interestrateripoff]

Shares of G.M. Make Debut on Market With a Price Surge

 

By MICHAEL J. DE LA MERCED and BILL VLASIC 56 minutes ago

 

 

Shares of General Motors opened on Thursday at $35 and rose nearly 8 percent in the first few minutes on the New York Stock Exchange.

 

• Ford to Sell Most of Its Mazda Stake 8:21 AM ET
  
• Chrysler Trailing G.M. and Ford
  
• The Vanishing I.P.O.
  
• DealBook: Return to Market Validates G.M., Executive Says
  

 

 

 

Fabrizio Costantini for The New York Times

 

The sale, the largest initial stock offering ever, came 17 months after G.M. emerged from a government-brokered bankruptcy.

 

 

 

 

 

DealBook

 

Rattner Settles With S.E.C. for $6.2 Million as Cuomo Sues

 

By PETER LATTMAN 15 minutes ago

 

The New York attorney general’s suit against Steven L. Rattner in a kickback case came as the S.E.C. on Thursday announced a settlement with Mr. Rattner.

 

Stocks Rise as G.M. Makes Its Debut

 

By CHRISTINE HAUSER and DAVID JOLLY 38 minutes ago

 

U.S. stocks followed markets in Asia and Europe higher as expectations grew that Ireland would receive billions to rescue its banks and as shares of General Motors opened for trading.

 

Irish Officials Acknowledge Need for Aid in Debt Crisis

 

By DAVID JOLLY and NIKI KITSANTONIS 8 minutes ago

 

Irish officials on Thursday said for the first time that the country was seeking “a very substantial loan” to restore confidence in its long-term finances.

 

• For Euro Nations, There Are Strings Attached
  

 

DealBook

 

2 Former Madoff Aides Are Arrested

 

By PETER LATTMAN 28 minutes ago

 

Bernard L. Madoff's longtime personal secretary and one of his former top aides are expected to be charged on Thursday.

 

Delinquency Rate on U.S. Mortgages Declines

 

By REUTERS 10:41 AM ET

 

But the report, from the Mortgage Bankers Association, also found a rising rate of new foreclosure applications.

 

U.S. Jobless Claims Rise Slightly

 

By REUTERS 10:41 AM ET

 

But the four-week average of new claims dropped. Separately, a gauge of future economic activity showed a solid rise.

 

In Unusual Move, Fed Bolsters Its Defense of Its Plan

 

By SEWELL CHAN

 

The Fed chairman, Ben S. Bernanke, met with 11 members of the Senate banking committee to explain the move to inject $600 billion into the banking system.

 

Beijing’s Focus on Food Prices Ignores Broader Inflation Risk

 

By KEITH BRADSHER

 

Chinese policy makers are striving to curb inflation, but their approach carries risks. For one thing, their plan flies in the face of steps the U.S. has been urging.

 

In Small Test, Experimental Prostate Drug Shows Promise

 

By ANDREW POLLACK

 

The treatment XL184 seems to clear up cancer that has spread to the bone. Meanwhile, Medicare appears more likely to pay for the expensive prostate cancer drug Provenge.

 

 

 

• DealBook: Cablevision Exploring Spinoff of Rainbow Media
  
• O.E.C.D. Sees Global Recovery Slowing 9:15 AM ET
  
• New Exotic Investment: Latin Baseball Futures
  
• Foreclosure Fix Is Seen as Distant
  
• Fed Requires Test for Banks Before Restoring Dividend
  
• DealBook: Massey Will Review Any Offer, Chief Says
  
• Merck Drug for Cutting Cholesterol Is Promising
  

[interestrateripoff]

Breaking news

 

• 
  
• US STOCKS-Markets lower on China moves, tech a bright spot - Reuters
  
• Imminent supply weighs on shorter maturities - Reuters
  
• Heinz sales disappoint, hurt by consumer "funk" - Reuters
  
• Medco sees 'sustainable' profit path through 2020 - Reuters
  
• Euro rises on Ireland hopes, resistance to cap gain - Reuters
  
• European bank revolt over regulation grows - Reuters
  
• Budget cuts to hurt European IT services firms - Reuters
  
• FUND VIEW-Mirae likes Russian retail, bank stocks - Reuters
  

 

 

 

• Ireland's debt crisis - live coverage
   
  Live Taoiseach Brian Cowen faces fresh calls to resign as Ireland remains in the spotlight as formal talks begin with the IMF
  63 comments
  
  • Latest “2.43pm: Allied Irish Banks has finally released its interim management statement. Reading through it quickly now, these seem to be the key points…”
    Ireland's debt crisis - live coverage
     
    

  [*] Brian Cowen resists calls to resign over Irish debt crisis

   

  Leader of opposition Labour party urges Taoiseach to step down in national interest to allow new government to conclude talks

   

  • Should Brian Cowen resign?
    
  • Ireland takes tough stance on corporation tax
    
  • Mixed feelings in Dublin as the IMF arrives
    
  • Analysis: UK must help out to save its own banks
    
  • Nils Pratley: An Irish jig is not yet in order
    
  • Ireland has not surrendered sovereignty, says PM
    
  • Bailout worth 'tens of billions', says Irish central bank
    
  • Ireland crisis - Thursday's action
    
  • Central bank governor's interview in full
    
  • Q&A: What if I've got money in an Irish bank?
    
  • TV resignation hoax causes further anguish
    

  [*] Ireland is losing the propaganda war

   

  Lisa O'Carroll's Ireland business blog: Anyone arriving at Dublin's futuristic new airport terminal will get an different impression of Ireland from that portrayed in the world's media

  41 comments

  • Video: Ireland not humiliated by bailout, says PM
    

 

 

• Philip Green gives up his dividend again as Arcadia profits top £200m
   
  Tycoon takes no dividend for fifth year in a row
  
• OECD cuts UK economic growth forecast
   
  Organisation for Economic Co-operation and Development says the government's deep spending cuts will increase the 'headwinds' facing the economy
  107 comments
  
  • UK retail sales show signs of recovery
    
  • Comment: Larry Elliott
    

  [*] FBI arrests two former secretaries 0f Bernie Madoff

   

  Ponzi swindler's aides charged with 'knowingly assisting' in billion-dollar fraud

  [*] Osborne backtracks on City reforms

   

  Chancellor forced to reverse plan to give economic crime agency power to prosecute insider dealing

  [*] Qantas to replace half of its Rolls-Royce A380 engines

   

  Qantas boss says up to 40 Rolls-Royce Trent 900s will need to be repaired as Germany's Lufthansa changes a second engine

  [*] More business news

  [*] Huhne signals frustration over green investment bank

  25 comments

  [*] Capita says public sector cuts will not hit profit margins