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The president of the European Council said Friday that a new intergovernmental treaty meant to save the single currency will include the 17 eurozone states plus six other European Union countries – but not all 27 EU members, http://ftalphaville.ft.com/thecut/2011/12/09/789181/eurozone-leaders-agree-236-accord/
China’s annual inflation fell in November to 4.2 per cent, the lowest level in more than a year, reports Reuters, fuelling expectations of further monetary policy easing. The rate has dropped rapidly since hitting a three-year high of 6.5 per cent in July. http://ftalphaville.ft.com/thecut/2011/12/09/789171/chinese-inflation-plunged-in-november/
Distressed debt investors are circling a number of European companies that have run into trouble as the continent’s mounting economic woes put pressure on smaller businesses that are often highly leveraged, http://ftalphaville.ft.com/thecut/2011/12/09/789161/distressed-debt-investors-eye-europe/
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China’s manufacturing sector contracted in November, marking the first decline since February 2009, the FT reports. The official purchasing managers’ index (PMI) fell to 49.0 in November from 50.4 in October, http://ftalphaville.ft.com/thecut/2011/12/01/774641/china-pmis-go-negative/
Asian markets retained their gains on Thursday on the back of the previous day’s central bank liquidity moves, despite poor manufacturing data from China. The wave of central bank action around the world to avert a liquidity crisis cheered financial markets on Wednesday but highlighted the depth of international concern about possible economic turmoil in Europe,http://ftalphaville.ft.com/thecut/2011/12/01/774701/markets-remain-bouyant-on-liquidity-move/
Zynga, the fast-growing online game maker, plans to value itself at as much as $10 billion in its forthcoming IPO, says NYT Dealbook, citing two people briefed on the matter. The company plans to file an amended prospectus on Friday with an estimated price range of about $8 to $10 a share, http://ftalphaville.ft.com/thecut/2011/12/01/775001/zynga-said-to-seek-10bn-ipo-valuation/
Japan’s two biggest carmakers warned that the record strength of the yen could drive more car manufacturing overseas and called for more aggressive official intervention to push the currency lower, reports the FT. http://ftalphaville.ft.com/thecut/2011/11/30/774551/toyota-and-nissan-call-for-more-action-on-yen/
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Moody’s Investors Service warned on Monday the rapid escalation of the euro zonesovereign and banking crisis threatens the credit standing of all European government bond ratings, reports Reuters. ”While Moody’s central scenario remains that the euro area will be preserved without further widespread defaults, http://ftalphaville.ft.com/thecut/2011/11/28/766191/crisis-threatens-all-eu-ratings-moodys/
Retail sales on Black Friday rose by their biggest margin since 2007 to hit a new record, the FT reports, while online sales grew even faster, according to initial estimates. Store sales on the frenetic shopping day that follows the US Thanksgiving holiday expanded by 6.6 per cent from the previous year to $11.4bn, http://ftalphaville.ft.com/thecut/2011/11/28/765991/big-gain-in-black-friday-sales/
Brussels is threatening to sue Britain unless ministers significantly alter a landmark tax deal with Switzerland, in a dispute that will cast doubt over the £4bn to £7bn of expected proceeds for the Treasury,http://ftalphaville.ft.com/thecut/2011/11/28/766101/eu-threatens-legal-action-of-uk-swiss-tax-deal/
France and Germany are urgently preparing contingency plans to jump-start tighter eurozone economic governance, the FT reports, amid a growing realisation in Berlin that a deal endorsed by all 27 member states may take too long. http://ftalphaville.ft.com/thecut/2011/11/28/765971/tighter-eurozone-fiscal-plans-canvassed/
and much more….
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India is to throw open its $450bn retail sector to foreign supermarkets, granting access for the first time to giants such as Walmart, Carrefour and Tesco that have long sought to enter an underserved market of 1.2bn people, http://ftalphaville.ft.com/thecut/2011/11/25/763771/india-opens-doors-to-supermarket-giants/
The US, backed by Saudi Arabia, is refusing to sign off on a flagship global climate fund, the FT reports, days ahead of an important UN climate summit. The fund is one of the few measures to emerge from seven years of talks on how countries should share the burden of cutting greenhouse gas emissions, http://ftalphaville.ft.com/thecut/2011/11/25/763591/us-blocks-key-climate-fund-as-carbon-prices-plunge/
France is pushing for a European oil embargo on Iran, breaking a diplomatic taboo that could have significant ramifications for the energy market and global economic growth, the FT reports. Paris has made the proposal to European Union members preparing a new round of sanctions following the release of a UN nuclear agency report this month. http://ftalphaville.ft.com/thecut/2011/11/24/763511/france-pushes-for-iranian-oil-embargo/
The Chinese government has launched a crackdown on hundreds of unregulated electronic equity and futures exchanges that have sprung up in recent years to trade everything from fine art and commodities to insurance products, http://ftalphaville.ft.com/thecut/2011/11/24/763481/china-cracks-down-on-rogue-exchanges/
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The failed German Bund auction on Wednesday dampened sentiment in Asian stock markets on Thursday, particularly in Japan where the Nikkei 225 in the morning hit its lowest level since April 2009, reports the FT. http://ftalphaville.ft.com/thecut/2011/11/24/761231/bund-auction-reverberates-through-markets/
Investors paid record amounts to protect themselves against the risk of default by Bank of America on Wednesday, as fears grow over US banks’ exposure to the eurozone debt crisis, says the FT. Credit default swaps on BofA rose as high as 495 basis points, http://ftalphaville.ft.com/thecut/2011/11/24/761211/us-bank-credit-default-swaps-jump/
The Brazilian government has suspended Chevron’s drilling rights in Brazil until it clarifies the causes of an offshore oil spill, reports Reuters. Brazil’s National Petroleum Agency said it decided to halt Chevron’s drilling rights after determining that there was evidence that the company had been “negligent” http://ftalphaville.ft.com/thecut/2011/11/24/761241/brazil-suspends-chevrons-offshore-drilling-rights/
The Irish government wants European authorities to share the cost of Ireland’s €63bn ($84bn) bank bail-out because “reckless lending” by international banks to Irish banks contributed to their collapse, http://ftalphaville.ft.com/thecut/2011/11/24/761181/ireland-seeks-eu-help-over-bank-bail-out/
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Nomura has approached big private equity firms about the possible sale of domestic businesses, including its real estate arm, as the Japanese bank moves to shore up its capital buffers, reports the FT. http://ftalphaville.ft.com/thecut/2011/11/23/759061/nomura-steps-up-its-asset-sale-plans/
The US Federal Reserve is unlikely to ease monetary policy any further until it has settled on a new communication strategy, according to the minutes of its November meeting released on Tuesday, reports the FT. http://ftalphaville.ft.com/thecut/2011/11/23/759041/fed-unlikely-to-institute-qe3-2/
Egypt’s ruling generals have promised to speed up the handover of power to elected civilians but the gesture failed to placate the hundreds of thousands of protesters who have packed Cairo’s Tahrir Square in a replay of the demonstrations that brought down the rule of Hosni Mubarak, http://ftalphaville.ft.com/thecut/2011/11/23/759011/egypt%e2%80%99s-generals-pledge-quick-handover-2/
Goldman Sachs’ planned redevelopment of one of the City of London’s largest unoccupied offices hit a snag on Tuesday after the government granted protected status to murals adorning the front of the building, http://ftalphaville.ft.com/thecut/2011/11/23/758981/goldman-hits-a-wall-over-city-hq-plan/
30,000 billion US dollars in ghost assets will disappear by early 2013
Must read article by GEAB on the Debt of the world and the crisis entering new dimensions…
As we come to the end of the second half of 2011, it is evident that 15,000 billion in ghost assets have gone up in smoke since last July, just as was anticipated by LEAP/E2020 (GEAB N°56 ). And, according to our team, this process figures to continue at the same rate throughout the year to come. Indeed we estimate that, with the introduction of a 50% discount on Greek government debt, the global systemic crisis has entered a new phase: that of the generalized discount on Western public debt and its corollary, the fragmentation of the global financial markets. Our team believes that 2012 will bring an average discount of 30% of total Western public debt (1), plus an equivalent amount in loss of assets from the balance sheets of worldwide financial institutions. Specifically, LEAP/E2020 anticipates the loss of 30,000 billion ghost assets by early 2013 (2), with an acceleration in 2012 of the partitioning process of the global financial market (3) into three increasingly disconnected currency areas: Dollar, Euro, and Yuan. These two phenomena feed into each other. They will also be the cause of a sharp decline of 30% on the part of US currency in 2012 (4), as we announced last April (GEAB N°54 ), which will occur amidst a sharp reduction in demand for the US dollar and the worsening of the US governmental debt crisis. The end of 2011 will therefore see, as anticipated, the trigger of the European debt crisis detonating a US bomb.
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US stocks turned sharply lower in late-day trading after a report warned of eurozone risks to US banks, with European Central Bank attempts to prop up the Spanish and Italian bond markets failing to stem investor fears over sovereign debts, http://ftalphaville.ft.com/thecut/2011/11/16/750921/bank-fears-hit-us-financial-stocks/
The exiled chief abbot of a monastery that has become the flashpoint of sustained Tibetan unrest has appealed to the Chinese government to end a repression campaign seen as the source of an unprecedented string of self-immolations by monks from the area, http://ftalphaville.ft.com/thecut/2011/11/16/750881/abbot-urges-china-to-help-stop-self-immolations/
Mario Monti will serve as both prime minister and finance minister in Italy’s caretaker government of technocrats that was sworn in on Wednesday, the FT reports. The new cabinet also includes Corrado Passera, http://ftalphaville.ft.com/thecut/2011/11/16/750841/italy-forms-cabinet-of-technocrats/
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The president of Germany’s powerful Bundesbank has firmly rebuffed international demands for decisive intervention in the bond markets by the European Central Bank to combat the eurozone debt crisis,http://ftalphaville.ft.com/thecut/2011/11/14/744541/look-away-from-our-ecb-says-the-bundesbank/
Barclays’ finance director has called for an overhaul of “opaque and complex” accounting rules that artificially boosted the profits of big European and US banks by billions of pounds in the third quarter of this year. http://ftalphaville.ft.com/thecut/2011/11/14/744521/barclays-asks-for-fair-treatment-on-fair-value-accounting/
Japan’s economy expanded strongly between July and September, returning to growth after three consecutive quarters of decline, according to a government preliminary estimate released on Monday, the FT reports. http://ftalphaville.ft.com/thecut/2011/11/14/744461/japan-lives-gdp-growth-seen-at-1-5-per-cent/
Mario Monti was handed the task on Sunday night of forming an emergency government led by technocrats as Italy’s head of state raced to win broad political consensus before financial markets opened on Monday, http://ftalphaville.ft.com/thecut/2011/11/14/744441/monti-takes-over-your-move-other-mario/
News That Matters
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The precedent set by the restructuring of Greek sovereign debt risks leaving banks more exposed to future financial crises of other countries, according to Deutsche Bank chief executive Josef Ackermann,http://ftalphaville.ft.com/thecut/2011/11/09/735701/ackermann-warns-of-greek-precedent/
A US federal judge on Tuesday ordered the convicted hedge fund titan Raj Rajaratnam to pay a $92.8m penalty, the largest ever assessed against a person in an SEC insider trading case, says NYT DealBook. Combined with the fines and forfeitures ordered last month when he was sentenced to 11 years in prison for insider trading, http://ftalphaville.ft.com/thecut/2011/11/09/735581/rajaratnam-ordered-to-pay-92-8m-sec-fine/
Chinese inflation fell sharply in October to 5.5 per cent year-on-year, the lowest in five months, the FT reports, clearing the path for a slight easing in monetary policy to support growth. It was the third straight month of slowing inflation and the biggest drop yet, http://ftalphaville.ft.com/thecut/2011/11/09/735571/chinese-inflation-falls-sharply/
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