World economy talk

[uls]

Bernanke speech last night

FRB: Speech--Bernanke, The U.S. Economic Outlook--June 7, 2011

U.S. economic growth so far this year looks to have been somewhat slower than expected.

Against this backdrop, the Federal Open Market Committee (FOMC) has maintained a highly accommodative monetary policy, keeping its target for the federal funds rate close to zero and further easing monetary conditions through large-scale asset purchases. The FOMC has indicated that it will complete its purchases of $600 billion of Treasury securities by the end of this month while maintaining its existing policy of reinvesting principal payments from its securities holdings. The Committee also continues to anticipate that economic conditions are likely to warrant exceptionally low levels for the federal funds rate for an extended period.

[Ry_Tower]

Bad for Obama's re-election...

Bad talaga, IMO, he will not be reelcted. Too much stress on US economy. He was not able to effectively improve it. Parang stop-gap solution lang nagagawa but nothing really drastic to grab oppurtunity and improve their situation. The jobless data looks gloomy pa.

[tidus1203]

He will lose the elections (pending the Republican nominee of course) as I was saying even 2 years ago. Obama is left wing eh, and left wing people just know how to spend. Its not gonna work, Keynesian economics IS DEAD! Yeah some people laughed at me back in 2008 for being anti-Keynesian, o nasa na mga critics ko ngayon?

Sad to say though the problem is systematic and the only thing that can heal it is time.

[tidus1203]

TEPCO stock has fallen 90% since the March 11 earthquake

TEPCO won't be allowed to go down... They suipply power 1/3 of the Japanese economy... Instead shareholders should be wary of NATIONALIZATION... Cause if that happens they get wiped out...

[uls]

TEPCO won't be allowed to go down... They suipply power 1/3 of the Japanese economy... Instead shareholders should be wary of NATIONALIZATION... Cause if that happens they get wiped out...

ya TBTF ang tepco

[uls]

He will lose the elections (pending the Republican nominee of course) as I was saying even 2 years ago. Obama is left wing eh, and left wing people just know how to spend. Its not gonna work, Keynesian economics IS DEAD! Yeah some people laughed at me back in 2008 for being anti-Keynesian, o nasa na mga critics ko ngayon?

Sad to say though the problem is systematic and the only thing that can heal it is time.

basically the problem is there's too much debt in the system

consumers couldnt take on more debt and/or creditors wont lend more money

consumers have borrowed too much

now they're deleveraging

the US economy relies on consumer spending

but consumers can't spend while they're deleveraging

without increased consumer spending, the US economy isn't going anywhere

deleveraging is a slow process

the US economy will be slow for a long time

[Ry_Tower]

TBTF pala Tepco kaya nationalization lang pupuwede maka-save.

[tidus1203]

Ya you would imagine they power the Tokyo Metro area and the whole Kanto region which also includes Yokohama and other big cities, so go figure why they are too big to fail...

[Ry_Tower]

Ya you would imagine they power the Tokyo Metro area and the whole Kanto region which also includes Yokohama and other big cities, so go figure why they are too big to fail...

I hope Japan will somehow get through this early. Papunta brother-in-law ko dun sa August eh, sayang kung ganyan at baka magbalik agad siya.

[tidus1203]

Some Republicans are thinking of allowing the US to default as a scare tactic on the Obama administration! Idiotic politicians, politics can make a person stupid, no?

The idea of a technical default -- essentially delaying interest payments for a few days -- has gained backing from a growing number of mainstream Republicans who see it as a price worth paying if it forces the White House to slash spending, Reuters reported on Tuesday.

China warns U.S. debt-default idea is "playing with fire" - Yahoo! Finance

[jhnkvn]

TEPCO won't be allowed to go down... They suipply power 1/3 of the Japanese economy... Instead shareholders should be wary of NATIONALIZATION... Cause if that happens they get wiped out...

True. They won't go with bankruptcy, nationalization na talaga tawag dyan a.k.a. bail out. Firstly, Japan needs to go get their wiped out infrastructure back in place. It's not like somebody dropped a bomb over Hiroshima or something, kaya nila yan!

[Monseratto]

Some Republicans are thinking of allowing the US to default as a scare tactic on the Obama administration! Idiotic politicians, politics can make a person stupid, no?



China warns U.S. debt-default idea is "playing with fire" - Yahoo! Finance

Nagalit tuloy yung mga lenders nila...

China is the largest foreign creditor to the United States, holding more than $1 trillion in Treasury debt as of March, U.S. data shows, so its concerns carry considerable weight in Washington.

"How can the U.S. be allowed to default?" said an official at India's central bank. "We don't think this is a possibility because this could then create huge panic globally."

Indian officials say they have little choice but to buy U.S. Treasury debt because it is still among the world's safest and most liquid investments. It held $39.8 billion in U.S. Treasuries as of March, U.S. data shows.

Oman is concerned about the impact of a default on the currency reserves of the sultanate and its Gulf neighbors.

"Our economies are substantially tied up with the U.S. financial developments," said a senior central bank official, who spoke on condition of anonymity.


Yuan Gangming, a researcher with the Chinese Academy of Social Sciences, a government think tank, smelled some political wrangling behind the U.S. debt debate as the 2012 presidential election draws nearer and said Republicans "want to make things difficult for Obama."

But with time running short before the U.S. Treasury exhausts its borrowing room, Yuan said default was a real risk.

"The possibility is quite high to see a default of the U.S. debt, which would harm many countries in the world, and China in particular," he said.

[tidus1203]

Well obviously... Eh kung pinautang mo isang tao tapos sasabihin sayo baka di muna sila magbayad. Typical reaction...

[uls]

now it's beginning to make sense (to me) why PIMCO dumped US Treasuries (betting interest rates will rise)

so far the bet isnt paying off

the 10 yr yield has fallen below 3%





at this point in time, we can say PIMCO is definitely wrong

but if the Republicans are crazy enough to not raise the debt ceiling before Aug. 2 and let the USG default -- Treasury interest rates will rise

PIMCO is plugged in. they have heavy connections in DC. they probably know something well in advance

[Monseratto]

Oil rises as OPEC maintains production level - Yahoo! Finance

NEW YORK (AP) -- A contentious meeting of oil ministers ended Wednesday with a clear message: Don't count on OPEC to do much about oil prices.

The 12-nation group decided not to boost production, which likely would have resulted in lower prices. That sent oil back above $100 a barrel. And more importantly, it sets the stage for higher prices later this year.

Saudi Arabia has indicated a willingness to supply whatever the market needs. Analyst Jim Ritterbusch thinks the Saudis will quietly increase exports regardless of their quota, since keeping prices under control is in their best interest.

"They don't want countries to turn to alternative fuels," he said. "They don't want people on buses."

But J.P. Morgan analyst Lawrence Eagles questioned if Saudi Arabia really could meet increased demand and believes the lack of an agreement "seems to highlight the limited spare capacity among many (OPEC) members." That's one reason he expects Brent crude will rise to an average of $130 per barrel this year.

[Ry_Tower]

Oil rises as OPEC maintains production level - Yahoo! Finance

Sama naman ng Pasko niyan!

[uls]

OPEC is dead

Saudi Arabia and friends (Kuwait, Qatar, UAE) want to raise output

the other members opposed

so much for that "cartel"

[ame=http://www.youtube.com/watch?v=Z9poHVhI7Zs]YouTube - ‪OPEC: Oil Levels Unchanged [NBC: 6-08-2011]‬‏[/ame]

[Monseratto]

More bad news

Jobless Claims Unexpectedly Climb in the U.S. - Bloomberg

U.S. initial jobless claims unexpectedly rose last week, a sign that the labor market is struggling to gain traction.

Jobless claims increased by 1,000 to 427,000 in the week ended June 4, Labor Department figures showed today in Washington. Economists surveyed by Bloomberg News projected a drop in claims to 419,000, according to the median forecast. The number of people on unemployment benefit rolls and those receiving extended payments decreased.

Some employers are cutting staff as demand slows because of elevated energy prices, falling house prices and tight credit. The economy generated the fewest jobs in May in eight months and the unemployment rate rose, a report showed last week.

“The labor market is obviously struggling,” Michael Feroli, chief U.S. economist at JPMorgan Chase & Co. in New York, said before the report. “I expect claims to stabilize and eventually come down.”

Today’s data showed the four-week moving average, a less volatile measure than the weekly figures, fell to 424,000 last week from 426,750.

The number of people continuing to receive jobless benefits fell by 71,000 in the week ended May 28 to 3.68 million.

The continuing claims figure does not include the number of Americans receiving extended benefits under federal programs.

Those who’ve used up their traditional benefits and are now collecting emergency and extended payments decreased by about 52,100 to 3.99 million in the week ended May 21.

The unemployment rate among people eligible for benefits, which tends to track the jobless rate, fell to 2.9 percent from 3 percent, today’s report showed.

Initial jobless claims reflect weekly firings and tend to fall as job growth -- measured by the monthly non-farm payrolls report -- accelerates.

Some employers are still considering possible cuts to their workforce.

Morgan Stanley (MS), owner of the world’s largest brokerage, may eliminate more jobs at its wealth management unit as Barclays Capital cuts positions in its equities division worldwide.

“As we continue to take actions to improve broker efficiency we may reduce our broker headcount below previously announced targets,” Morgan Stanley Chief Financial Officer Ruth Porat said at the Deutsche Bank Global Financial Services Conference on June 7. The unit, which had about 17,800 employees at the end of March, was previously aiming to reduce that figure to as little as 17,500, according to a spokesman for the bank. The firm cut 300 brokers at the division in the first quarter.

Barclays Capital, the investment-banking unit of London- based Barclays Plc (BARC), cut as many as 50 jobs in its equities unit, a person familiar with the matter said.

[uls]

[tidus1203]

ECB maintained rates, when people were expecting them to at least be hawkish...