World economy talk

[tidus1203]

Big sell-off yesterday. Yesterday was the day that I wished I had more money so I could invest *sigh*

All I say is "Don't catch falling knives"! I have been trading the markets long enough to know that you should trade on momentum instead of bargain hunting... You can be lucky fishing the markets but the chances are very slim. Trading is like gambling but in a more predictable and systematic way.

[tidus1203]

mga peeps ano ba meron sa diesel? talaga bang mas mura siya iproduce compared sa gasoline?

last week kakapunta ko lang ng SG (first time to be there too) and pansin ko a lot of their taxis are being powered by Diesel. Their diesel by the way is much cheaper by a few cents.. so ganun ba talaga diesel mas cheap iproduce or artificial lang ang pagka cheap nito?

Its artificial! A barrel of DIESEL is more expensive than a barrel of GAS in the world markets. Countries which have cheaper diesel is subsidized by their governments to help industry and the transport sector who use diesel... Sa US and Canada mas mahal ang diesel than gas....

[tidus1203]

Pandora

Wala na mga super hot tech IPO's...

Look at LinkedIn (LNKD). At one point it went to $120/share now its just $68...

Russia's Yandex (YNDX) was $40 at one point, now its just $30.

Tech IPO's are good for day trading only hahaha

[uls]

mga peeps ano ba meron sa diesel? talaga bang mas mura siya iproduce compared sa gasoline?

last week kakapunta ko lang ng SG (first time to be there too) and pansin ko a lot of their taxis are being powered by Diesel. Their diesel by the way is much cheaper by a few cents.. so ganun ba talaga diesel mas cheap iproduce or artificial lang ang pagka cheap nito?

mas mura i-produce ang diesel sa gasoline

in the refining process, it takes less refining to produce diesel from crude oil than to produce gasoline

but coz of stricter emissions regulations in some countries, additional refining is done to remove more sulfur from diesel so higher refining cost = higher price

there's supply and demand. refiners break down (crack) crude oil into many end-products (gasoline, kerosene, diesel, heating oil etc). but they can't produce all of it at the same time. there are times they produce more diesel, there are times they produce more gasoline. kung ano mas konte sa market, tataas ang presyo

then there's taxes. some governments tax diesel more than gasoline

[Monseratto]

Oil spread shrinking...

MARKET WATCH: Energy prices tumble; Brent-WTI spread at 3-month low - Oil & Gas Journal
Jun 16, 2011
Sam Fletcher
OGJ Senior Writer


HOUSTON, June 16 -- Energy prices fell sharply June 15 with the August contract for North Sea Brent dropping more than $6/bbl, wiping out “all the gains of the last 15 trading days” and closing its price spread vs. West Texas Intermediate to “the weakest level” since March, said Olivier Jakob at Petromatrix, Zug, Switzerland.

[uls]

Brent front month futures $113.83

WTI front month futures $94.96

it's still an 18-19 dollar spread. but below the record 21-22 dollar spread

--

Brent spot is above $117

[Ry_Tower]

Brent front month futures $113.83

WTI front month futures $94.96

it's still an 18-19 dollar spread. but below the record 21-22 dollar spread

--

Brent spot is above $117

Mahal pa rin, no roll back sa tingin niyo mga guru this weekend?

[tidus1203]

Dapat may rollback na yan... Malaki binagsak ng oil this week...

[uls]

Spain 10 yr yield

[Ry_Tower]

Mahal pa rin, no roll back sa tingin niyo mga guru this weekend?

Sunday IMO or early Monday pa noh?

[tidus1203]

Comparative European 10 year debt...

102.380 Germany
49.801 Greece
99.246 Spain
58.702 Portigal

Greece less than half. Bargain!

[Monseratto]

Hmm...parang the same banana, they just changed the wording from "restructure" to "rollover". I doubt they'll get the same rates in this so called "voluntary" rollover. Would this action still be construed as a default?

Europe Shifts Path for Greek Rescue - WSJ.com

Road Runs Through 'Vienna,' but It Has Bumps; Key Question—What's Voluntary?

Standing together in Berlin Friday, Angela Merkel and Nicolas Sarkozy said they see a way forward for Greece. And it goes via Vienna.

Both cited the "Vienna Initiative" as the way to draw a contribution to the new Greece rescue package from the holders of the roughly €280 billion ($400 billion) of Greek government bonds. It is another piece of jargon in a head-spinning lexicon that also includes reprofiling, rescheduling, restructuring, and rollovers.

But will it help Greece's official creditors reduce the amount they must lend to keep Athens afloat? At first, the Vienna Initiative appears more like a metaphor than a template for Greece.

The original initiative, conceived in 2009 in the Austrian capital, was triggered by worries then that a flight of funds from Romania, Hungary, Serbia, Latvia and Bosnia would worsen economic crises in those countries. The main part of it was a voluntary commitment by Western banks to keep capital in their subsidiaries in those countries and maintain loan volumes.

As a "private sector contribution," investors could be compelled to extend the maturities of their debts or payoff maturing bonds with new bonds. But that would lead rating agencies to call the bonds in default, which could trigger a damaging contagion to other countries. (Greece would be declared in 'selective default,' because it would still be servicing other bonds.)

Leave it as a truly voluntary participation instead, with holders of maturing bonds given something else to buy, and the "private sector contribution" would be close to zero.

But lots of techniques that look voluntary could trigger a default call. If an investor exchanges maturing bonds for new paper paying less than the current 20%-30%, there's a default.

"Whether it's voluntary or not isn't the primary determinant," said David Riley, managing director of the sovereign group at Fitch Ratings, adding that the key issue will be whether bond holders suffer some sort of economic loss in a deal. "It's hard to see how you're going to get substantive debt relief for Greece without implying some kind economic loss for holders."

[uls]

rollover means a bond investor reinvests money from maturing bonds in new bonds issued by the same entity. a bond investor will only rollover when there's financial incentive to do so

in Greece situation, bond investors will take losses in the rollover. the new bonds will have much lower yield

there's no financial incentive for Greece bondholders to rollover

[uls]

whatever terminology they use, they're gonna present Greece bondholders with 2 options --

extend the maturity date of near-maturing bonds years into the future

or payoff maturing bonds with new bonds (which will be worth 50% or less face value in the secondary market)

either way, ratings agencies consider it default

and bond insurance payouts will be triggered

[Monseratto]

How will Merkel involve the private bondholders without triggering ratings agencies' default? I guess all she's doing is for show, knowing no idiot will voluntarily like to keep their money in a sinking ship. THey're just delaying the inevitable. Even though Greece hasn't met the pre-conditions for the second tranche of the first bailout, they'll release it anyway just to avoid a market crash...

Funny how the Euro was concieved with stringent penalties if certain countries don't meet certain economic parameters, yet they let those countries get away with it and look at the mess.

The chancellor, normally the most cautious of politicians, appears to be taking a calculated risk with her compromise over Greece.

Both she and Wolfgang Schäuble, her finance minister, repeated their insistence at the weekend that private bondholders should make a “substantial” contribution to the Greek rescue. Mr Schäuble added the words “quantifiable and reliable”, although officials say a voluntary rollover would only be “quantifiable” at the end of the process, not at the start.

Details of which holders of Greek bonds would participate in a voluntary rollover, and how this would happen, remain unclear in spite of theoretical support from some in the private sector for the move.

A German bank representative told the Financial Times a rollover had to involve “no deterioration of conditions” for participating banks, insurers, pension funds and other bondholders. Many would be concerned at the risk of complaints from their own investors if they were seen to be taking a risk in maintaining exposure to Greece.

http://www.ft.com/intl/cms/s/0/1c68c...#axzz1Pm9rARPC

[uls]

How will Merkel involve the private bondholders without triggering ratings agencies' default? I guess all she's doing is for show, knowing no idiot will voluntarily like to keep their money in a sinking ship. THey're just delaying the inevitable. Even though Greece hasn't met the pre-conditions for the second tranche of the first bailout, they'll release it anyway just to avoid a market crash...

Funny how the Euro was concieved with stringent penalties if certain countries don't meet certain economic parameters, yet they let those countries get away with it and look at the mess.




FT.com / Europe - Merkel faces backlash over Greek deal

talaga naman they're delaying the inevitable

we keep hearing "kicking the can down the road"

they're postponing a default for as long as they possibly can. pag malapit na, they push it months into the future, then pag malapit na uli, they push it months into the future again. they'll keep doing it hanggang di na talaga kaya

EU leaders know European banks arent strong enough to take a hit like Greece defaulting (even if they were strong enough, there's no way they can withstand another hit like Portugal defaulting. or Ireland)

if Greece defaults now, Greece banks will instantly become insolvent. there will be bank runs. there are already bank runs

look at the EUR/CHF



the euro is all time weakest against the swissie



people taking euros out of Greece banks (and other Euro banks), convert to swiss francs for deposit in Swiss banks

if Greece defaults, some European banks will need capital injections just to stay solvent

keep in mind the interconnectedness of the global financial system

when a bank's financial standing is in doubt, nobody will want to lend to that bank

and whoever the bank owes money to, the financial standing of the counterparty will also be in doubt

interbank lending will freeze just like a some years ago

[boybi]

What happened? $92 nalang WTI.

[Monseratto]

What happened? $92 nalang WTI.

Glut in Saudi oil
Stronger US Dollar
Weakening demand
Greece...Greece...Greece

SINGAPORE (Reuters) - Brent crude fell more than $1 on Monday, extending last week's losses, as concern over a debt crisis in Greece and a weaker economic outlook for the world's top oil consumer, the United States, weighed on prices.

Brent crude slipped $1.41 a barrel to $111.75 a barrel, while U.S. oil declined $1.73 a barrel to $91.28 a barrel by 0651 GMT.

Euro zone finance ministers postponed a final decision on extending 12 billion euros in emergency loans to Greece, saying Athens would first have to introduce harsh austerity measures, pushing the euro lower.

The dollar index gained 0.5 percent against a basket of currencies, weighing on oil prices.

Mitsubishi's Nunan also attributed the fall in part to higher supplies by top oil exporter Saudi Arabia after OPEC talks collapsed earlier this month.

"If they are increasing supplies to Asia, they must have done so for Europe as well," Nunan said.

"Two factors have contributed to the collapse in oil futures -- Greece and the U.S. economic outlook," Shum said. "But the pull-back in prices is temporary because the Greece crisis will pass and supply side concerns remain."

[uls]

any moderator out there? favor... pa-tanggal yung "a"

interbank lending will freeze just like a some years ago

tanx. i'm OC eh hehe

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risk off

US stock futures down

EUR down

AUD down

CAD down

oil down

where's money going?

US Treasuries

[uls]

Shanghai stocks