Jittery traders focus on ‘safe haven’ investments as collapsing shares fuel panic at the exchanges Fresh turmoil on the world’s financial markets on Friday saw gold rise to record levels, the dollar sink to its lowest-ever level against the Japanese yen, and share prices gyrate wildly in Europe and North America. A day of rumours and extreme nervousness saw shares in Britain’s biggest companies lose all the gains in the market seen since the FTSE 100 index bottomed out on 11 August. Despite an afternoon rally, prompted by speculation that the US Federal Reserve was about to hold an emergency meeting to tackle the growing sense of market panic, the FTSE closed 51.47 points down at 5040.76, a decline of 1%. The Dow Jones industrial average also lost confidence later in the day as no announcement from the Fed was forthcoming and closed down 172.93 at 10,817.65, a fall of 1.6%. Earlier, London shares had collapsed after Thursday’s heavy selling on Wall Street prompted steep falls on Asian bourses. Fears that the global economy was heading for a double-dip recession, and signs that Europe’s bailout of Greece could collapse, saw the FTSE lose more than 3% of its value at one stage, sending it well below the 5000 mark. The steadier start to trading on Wall Street helped calm nerves in the City at the end of another frenetic week that saw markets once again focus on their two major concerns: growth and the fragility of Europe’s single currency. “This week has seen a continuation of the trend of weaker than expected data and political reaction to the European problems which pretty much amounts to ‘let’s have a get-together a couple of times a year’,” said Gary Jenkins, an analyst at Evolution Securities. The jittery atmosphere sent investors heading once again to the safe havens of the Swiss franc, the Japanese yen and gold. Bullion rose as high as $1,881 an ounce, with some dealers expecting it to test the $2,000 an ounce level over the coming weeks. On the foreign exchanges, the dollar dropped to just under ¥76 against the Japanese currency and was also down against the Swiss franc and the pound. The dollar’s fall helped underpin oil prices, with a barrel of Brent crude trading almost $2 higher at just under $109 a barrel. Switzerland’s two biggest banks, UBS and Credit Suisse, have denied that they made use of the Federal Reserve’s swap facility via the Swiss National Bank, insisting they have no liquidity problems. There had been speculation that a Swiss bank had accessed the US liquidity facility via a $200m repurchase transaction with the SNB last week. Evangelos Venizelos, Greece’s finance minister, said his country’s €109bn bail-out was not in doubt, despite the fissures within Europe being laid bare by the demands of five countries for collateral in exchange for paying into a rescue fund for the weaker countries in the monetary union. Venizelos also said the recession in his financially troubled country could be deeper than originally predicted for this year, with output potentially shrinking by more than 4.5%. His comments came a day after the Netherlands, Slovenia, Austria and Slovakia said on Thursday they wanted hundreds of millions of euros in collateral, in the same vein as Finland, which struck a deal with the Greek government earlier in the week to receive cash as security for its part of the bailout. Brussels sought to ease fears by stressing that Olli Rehn, Europe’s economic and monetary affairs commissioner, was looking at a plan for common European bonds, seen as a step towards closer financial integration among the 17 single-currency nations. European banking shares fell to near two-and-a-half-year lows, dragged down by rumours about banks’ potential losses on bonds issued by heavily indebted governments. Earlier, Asian shares took a beating, with Japan’s Nikkei 225 index dropping 2.5% to 8719.24 and Hong Kong’s Hang Seng down 3.1% to 19,399.92. Concerns that weak growth in Europe and the US would hit China’s exports affected sentiment in Shanghai, where the stock market’s composite index ended 1% lower at 2534.6 after dipping almost 2% earlier in the day. Some strategists said it was a good time to pick up stocks cheaply. Nick Bubb, retail analyst at Arden Partners, said: “If you want to buy when there’s blood on the streets, and on the screens, then today is a good day to pick up good quality, high-yielding general retail defensives like Marks & Spencer and WH Smith, as well as undervalued global retailers like Inchcape and Kingfisher. And in the food retailers, we wouldn’t want to be short of Wm Morrison, ahead of its interims on 8 September.” Investors continued to swap risky investments for those viewed as safe. The yield on the benchmark 10-year US Treasury bill rose, but only slightly, to 2.10%, after hitting a record low of just below 2% on Thursday. Bond yields fall as their prices rise in line with demand. Stock markets European debt crisis European banks Economic growth (GDP) Economics US economic growth and recession Global recession Global economy Commodities Bonds Currencies Financial crisis Banking Larry Elliott Julia Kollewe guardian.co.uk
Continue reading …Jittery traders focus on ‘safe haven’ investments as collapsing shares fuel panic at the exchanges Fresh turmoil on the world’s financial markets on Friday saw gold rise to record levels, the dollar sink to its lowest-ever level against the Japanese yen, and share prices gyrate wildly in Europe and North America. A day of rumours and extreme nervousness saw shares in Britain’s biggest companies lose all the gains in the market seen since the FTSE 100 index bottomed out on 11 August. Despite an afternoon rally, prompted by speculation that the US Federal Reserve was about to hold an emergency meeting to tackle the growing sense of market panic, the FTSE closed 51.47 points down at 5040.76, a decline of 1%. The Dow Jones industrial average also lost confidence later in the day as no announcement from the Fed was forthcoming and closed down 172.93 at 10,817.65, a fall of 1.6%. Earlier, London shares had collapsed after Thursday’s heavy selling on Wall Street prompted steep falls on Asian bourses. Fears that the global economy was heading for a double-dip recession, and signs that Europe’s bailout of Greece could collapse, saw the FTSE lose more than 3% of its value at one stage, sending it well below the 5000 mark. The steadier start to trading on Wall Street helped calm nerves in the City at the end of another frenetic week that saw markets once again focus on their two major concerns: growth and the fragility of Europe’s single currency. “This week has seen a continuation of the trend of weaker than expected data and political reaction to the European problems which pretty much amounts to ‘let’s have a get-together a couple of times a year’,” said Gary Jenkins, an analyst at Evolution Securities. The jittery atmosphere sent investors heading once again to the safe havens of the Swiss franc, the Japanese yen and gold. Bullion rose as high as $1,881 an ounce, with some dealers expecting it to test the $2,000 an ounce level over the coming weeks. On the foreign exchanges, the dollar dropped to just under ¥76 against the Japanese currency and was also down against the Swiss franc and the pound. The dollar’s fall helped underpin oil prices, with a barrel of Brent crude trading almost $2 higher at just under $109 a barrel. Switzerland’s two biggest banks, UBS and Credit Suisse, have denied that they made use of the Federal Reserve’s swap facility via the Swiss National Bank, insisting they have no liquidity problems. There had been speculation that a Swiss bank had accessed the US liquidity facility via a $200m repurchase transaction with the SNB last week. Evangelos Venizelos, Greece’s finance minister, said his country’s €109bn bail-out was not in doubt, despite the fissures within Europe being laid bare by the demands of five countries for collateral in exchange for paying into a rescue fund for the weaker countries in the monetary union. Venizelos also said the recession in his financially troubled country could be deeper than originally predicted for this year, with output potentially shrinking by more than 4.5%. His comments came a day after the Netherlands, Slovenia, Austria and Slovakia said on Thursday they wanted hundreds of millions of euros in collateral, in the same vein as Finland, which struck a deal with the Greek government earlier in the week to receive cash as security for its part of the bailout. Brussels sought to ease fears by stressing that Olli Rehn, Europe’s economic and monetary affairs commissioner, was looking at a plan for common European bonds, seen as a step towards closer financial integration among the 17 single-currency nations. European banking shares fell to near two-and-a-half-year lows, dragged down by rumours about banks’ potential losses on bonds issued by heavily indebted governments. Earlier, Asian shares took a beating, with Japan’s Nikkei 225 index dropping 2.5% to 8719.24 and Hong Kong’s Hang Seng down 3.1% to 19,399.92. Concerns that weak growth in Europe and the US would hit China’s exports affected sentiment in Shanghai, where the stock market’s composite index ended 1% lower at 2534.6 after dipping almost 2% earlier in the day. Some strategists said it was a good time to pick up stocks cheaply. Nick Bubb, retail analyst at Arden Partners, said: “If you want to buy when there’s blood on the streets, and on the screens, then today is a good day to pick up good quality, high-yielding general retail defensives like Marks & Spencer and WH Smith, as well as undervalued global retailers like Inchcape and Kingfisher. And in the food retailers, we wouldn’t want to be short of Wm Morrison, ahead of its interims on 8 September.” Investors continued to swap risky investments for those viewed as safe. The yield on the benchmark 10-year US Treasury bill rose, but only slightly, to 2.10%, after hitting a record low of just below 2% on Thursday. Bond yields fall as their prices rise in line with demand. Stock markets European debt crisis European banks Economic growth (GDP) Economics US economic growth and recession Global recession Global economy Commodities Bonds Currencies Financial crisis Banking Larry Elliott Julia Kollewe guardian.co.uk
Continue reading …Jittery traders focus on ‘safe haven’ investments as collapsing shares fuel panic at the exchanges Fresh turmoil on the world’s financial markets on Friday saw gold rise to record levels, the dollar sink to its lowest-ever level against the Japanese yen, and share prices gyrate wildly in Europe and North America. A day of rumours and extreme nervousness saw shares in Britain’s biggest companies lose all the gains in the market seen since the FTSE 100 index bottomed out on 11 August. Despite an afternoon rally, prompted by speculation that the US Federal Reserve was about to hold an emergency meeting to tackle the growing sense of market panic, the FTSE closed 51.47 points down at 5040.76, a decline of 1%. The Dow Jones industrial average also lost confidence later in the day as no announcement from the Fed was forthcoming and closed down 172.93 at 10,817.65, a fall of 1.6%. Earlier, London shares had collapsed after Thursday’s heavy selling on Wall Street prompted steep falls on Asian bourses. Fears that the global economy was heading for a double-dip recession, and signs that Europe’s bailout of Greece could collapse, saw the FTSE lose more than 3% of its value at one stage, sending it well below the 5000 mark. The steadier start to trading on Wall Street helped calm nerves in the City at the end of another frenetic week that saw markets once again focus on their two major concerns: growth and the fragility of Europe’s single currency. “This week has seen a continuation of the trend of weaker than expected data and political reaction to the European problems which pretty much amounts to ‘let’s have a get-together a couple of times a year’,” said Gary Jenkins, an analyst at Evolution Securities. The jittery atmosphere sent investors heading once again to the safe havens of the Swiss franc, the Japanese yen and gold. Bullion rose as high as $1,881 an ounce, with some dealers expecting it to test the $2,000 an ounce level over the coming weeks. On the foreign exchanges, the dollar dropped to just under ¥76 against the Japanese currency and was also down against the Swiss franc and the pound. The dollar’s fall helped underpin oil prices, with a barrel of Brent crude trading almost $2 higher at just under $109 a barrel. Switzerland’s two biggest banks, UBS and Credit Suisse, have denied that they made use of the Federal Reserve’s swap facility via the Swiss National Bank, insisting they have no liquidity problems. There had been speculation that a Swiss bank had accessed the US liquidity facility via a $200m repurchase transaction with the SNB last week. Evangelos Venizelos, Greece’s finance minister, said his country’s €109bn bail-out was not in doubt, despite the fissures within Europe being laid bare by the demands of five countries for collateral in exchange for paying into a rescue fund for the weaker countries in the monetary union. Venizelos also said the recession in his financially troubled country could be deeper than originally predicted for this year, with output potentially shrinking by more than 4.5%. His comments came a day after the Netherlands, Slovenia, Austria and Slovakia said on Thursday they wanted hundreds of millions of euros in collateral, in the same vein as Finland, which struck a deal with the Greek government earlier in the week to receive cash as security for its part of the bailout. Brussels sought to ease fears by stressing that Olli Rehn, Europe’s economic and monetary affairs commissioner, was looking at a plan for common European bonds, seen as a step towards closer financial integration among the 17 single-currency nations. European banking shares fell to near two-and-a-half-year lows, dragged down by rumours about banks’ potential losses on bonds issued by heavily indebted governments. Earlier, Asian shares took a beating, with Japan’s Nikkei 225 index dropping 2.5% to 8719.24 and Hong Kong’s Hang Seng down 3.1% to 19,399.92. Concerns that weak growth in Europe and the US would hit China’s exports affected sentiment in Shanghai, where the stock market’s composite index ended 1% lower at 2534.6 after dipping almost 2% earlier in the day. Some strategists said it was a good time to pick up stocks cheaply. Nick Bubb, retail analyst at Arden Partners, said: “If you want to buy when there’s blood on the streets, and on the screens, then today is a good day to pick up good quality, high-yielding general retail defensives like Marks & Spencer and WH Smith, as well as undervalued global retailers like Inchcape and Kingfisher. And in the food retailers, we wouldn’t want to be short of Wm Morrison, ahead of its interims on 8 September.” Investors continued to swap risky investments for those viewed as safe. The yield on the benchmark 10-year US Treasury bill rose, but only slightly, to 2.10%, after hitting a record low of just below 2% on Thursday. Bond yields fall as their prices rise in line with demand. Stock markets European debt crisis European banks Economic growth (GDP) Economics US economic growth and recession Global recession Global economy Commodities Bonds Currencies Financial crisis Banking Larry Elliott Julia Kollewe guardian.co.uk
Continue reading …Jittery traders focus on ‘safe haven’ investments as collapsing shares fuel panic at the exchanges Fresh turmoil on the world’s financial markets on Friday saw gold rise to record levels, the dollar sink to its lowest-ever level against the Japanese yen, and share prices gyrate wildly in Europe and North America. A day of rumours and extreme nervousness saw shares in Britain’s biggest companies lose all the gains in the market seen since the FTSE 100 index bottomed out on 11 August. Despite an afternoon rally, prompted by speculation that the US Federal Reserve was about to hold an emergency meeting to tackle the growing sense of market panic, the FTSE closed 51.47 points down at 5040.76, a decline of 1%. The Dow Jones industrial average also lost confidence later in the day as no announcement from the Fed was forthcoming and closed down 172.93 at 10,817.65, a fall of 1.6%. Earlier, London shares had collapsed after Thursday’s heavy selling on Wall Street prompted steep falls on Asian bourses. Fears that the global economy was heading for a double-dip recession, and signs that Europe’s bailout of Greece could collapse, saw the FTSE lose more than 3% of its value at one stage, sending it well below the 5000 mark. The steadier start to trading on Wall Street helped calm nerves in the City at the end of another frenetic week that saw markets once again focus on their two major concerns: growth and the fragility of Europe’s single currency. “This week has seen a continuation of the trend of weaker than expected data and political reaction to the European problems which pretty much amounts to ‘let’s have a get-together a couple of times a year’,” said Gary Jenkins, an analyst at Evolution Securities. The jittery atmosphere sent investors heading once again to the safe havens of the Swiss franc, the Japanese yen and gold. Bullion rose as high as $1,881 an ounce, with some dealers expecting it to test the $2,000 an ounce level over the coming weeks. On the foreign exchanges, the dollar dropped to just under ¥76 against the Japanese currency and was also down against the Swiss franc and the pound. The dollar’s fall helped underpin oil prices, with a barrel of Brent crude trading almost $2 higher at just under $109 a barrel. Switzerland’s two biggest banks, UBS and Credit Suisse, have denied that they made use of the Federal Reserve’s swap facility via the Swiss National Bank, insisting they have no liquidity problems. There had been speculation that a Swiss bank had accessed the US liquidity facility via a $200m repurchase transaction with the SNB last week. Evangelos Venizelos, Greece’s finance minister, said his country’s €109bn bail-out was not in doubt, despite the fissures within Europe being laid bare by the demands of five countries for collateral in exchange for paying into a rescue fund for the weaker countries in the monetary union. Venizelos also said the recession in his financially troubled country could be deeper than originally predicted for this year, with output potentially shrinking by more than 4.5%. His comments came a day after the Netherlands, Slovenia, Austria and Slovakia said on Thursday they wanted hundreds of millions of euros in collateral, in the same vein as Finland, which struck a deal with the Greek government earlier in the week to receive cash as security for its part of the bailout. Brussels sought to ease fears by stressing that Olli Rehn, Europe’s economic and monetary affairs commissioner, was looking at a plan for common European bonds, seen as a step towards closer financial integration among the 17 single-currency nations. European banking shares fell to near two-and-a-half-year lows, dragged down by rumours about banks’ potential losses on bonds issued by heavily indebted governments. Earlier, Asian shares took a beating, with Japan’s Nikkei 225 index dropping 2.5% to 8719.24 and Hong Kong’s Hang Seng down 3.1% to 19,399.92. Concerns that weak growth in Europe and the US would hit China’s exports affected sentiment in Shanghai, where the stock market’s composite index ended 1% lower at 2534.6 after dipping almost 2% earlier in the day. Some strategists said it was a good time to pick up stocks cheaply. Nick Bubb, retail analyst at Arden Partners, said: “If you want to buy when there’s blood on the streets, and on the screens, then today is a good day to pick up good quality, high-yielding general retail defensives like Marks & Spencer and WH Smith, as well as undervalued global retailers like Inchcape and Kingfisher. And in the food retailers, we wouldn’t want to be short of Wm Morrison, ahead of its interims on 8 September.” Investors continued to swap risky investments for those viewed as safe. The yield on the benchmark 10-year US Treasury bill rose, but only slightly, to 2.10%, after hitting a record low of just below 2% on Thursday. Bond yields fall as their prices rise in line with demand. Stock markets European debt crisis European banks Economic growth (GDP) Economics US economic growth and recession Global recession Global economy Commodities Bonds Currencies Financial crisis Banking Larry Elliott Julia Kollewe guardian.co.uk
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A growing belief that the country is headed toward recession gave the stock market its fourth straight week of losses. (Aug. 19)
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A growing belief that the country is headed toward recession gave the stock market its fourth straight week of losses. (Aug. 19)
Continue reading …Dean Baker On Super Committee Dems: ‘If They’d Bothered To Do Their Damn Jobs,’ We Wouldn’t Be In This Mess
August 19, 2011 No CommentEconomist Dean Baker really lets John Kerry, Patty Murray and Max Baucus have it for the column that appeared in the Wall St. Journal this week — but he’s especially savage with Kerry: Senator John Kerry, along with the two other Democratic senators appointed to the “Super Committee”, had a column in the Wall Street Journal yesterday on their approach to the committee’s work. This piece is infuriating for its empty platitudes and the refusal to acknowledge economic reality. In just 700 words the piece promulgated 3 major economic myths while ignoring the fundamental truths about the economy and the budget. The reason that we actually had a $240 billion surplus (2.4 percent of GDP) in 2000 was that the United States had a stock bubble propelled boom at the end of the decade. This caused the economy to grow much more rapidly than CBO expected with the unemployment rate falling to 4.0 percent in 2000, rather than the 6.0 percent predicted by CBO. Do the senators not remember the stock bubble? In addition to promoting these false stories about the economy and the budget, the senators fail to tell the true story. The large deficits the country currently faces are not the result of an ongoing pattern of excessive profligacy. They are the result of the economy’s plunge following the collapse of the housing bubble. Even with the cost of the wars, the Medicare drug benefit and the Bush tax cuts, the projected deficits were relatively modest prior to the collapse of the housing bubble. The true story is that our deficit problem is really an economic problem – we let a huge housing bubble grow, which would inevitably collapse and sink the economy. The deficit is needed now to make up for the $1.2 trillion loss in annual demand from the private sector, which had been generated by the housing bubble. The bubble had led to booms to both construction and consumption that have gone bust now that house prices have crashed. Senator Kerry deserves special blame in this story because he could never be bothered to pay attention to the housing bubble, even when he was running for president in 2004. I recall urging his campaign staffers to pay attention to the bubble. It was like talking to Barney Frank’s dining room table. Of course Robert Rubin was one of Kerry’s top economic advisers. Rubin was making tens of millions of dollars at Citigroup whose profits were derived largely from marketing subprime junk loans. So perhaps it is not surprising that Kerry had little interest in learning anything about the housing bubble. Still it is more than a bit infuriating that Senator Kerry and his colleagues would now be lecturing the country on the need for hard choices. If they could have been bothered to do their damn jobs just a few years ago, we would not be in this situation today. As a result of their failure, tens of millions of workers are unemployed or underemployed. Yet the senators, who are still drawing their paychecks, want the country to sacrifice even more. Maybe now they can be persuaded to learn a little economics.
Continue reading …Dean Baker On Super Committee Dems: ‘If They’d Bothered To Do Their Damn Jobs,’ We Wouldn’t Be In This Mess
August 19, 2011 No CommentEconomist Dean Baker really lets John Kerry, Patty Murray and Max Baucus have it for the column that appeared in the Wall St. Journal this week — but he’s especially savage with Kerry: Senator John Kerry, along with the two other Democratic senators appointed to the “Super Committee”, had a column in the Wall Street Journal yesterday on their approach to the committee’s work. This piece is infuriating for its empty platitudes and the refusal to acknowledge economic reality. In just 700 words the piece promulgated 3 major economic myths while ignoring the fundamental truths about the economy and the budget. The reason that we actually had a $240 billion surplus (2.4 percent of GDP) in 2000 was that the United States had a stock bubble propelled boom at the end of the decade. This caused the economy to grow much more rapidly than CBO expected with the unemployment rate falling to 4.0 percent in 2000, rather than the 6.0 percent predicted by CBO. Do the senators not remember the stock bubble? In addition to promoting these false stories about the economy and the budget, the senators fail to tell the true story. The large deficits the country currently faces are not the result of an ongoing pattern of excessive profligacy. They are the result of the economy’s plunge following the collapse of the housing bubble. Even with the cost of the wars, the Medicare drug benefit and the Bush tax cuts, the projected deficits were relatively modest prior to the collapse of the housing bubble. The true story is that our deficit problem is really an economic problem – we let a huge housing bubble grow, which would inevitably collapse and sink the economy. The deficit is needed now to make up for the $1.2 trillion loss in annual demand from the private sector, which had been generated by the housing bubble. The bubble had led to booms to both construction and consumption that have gone bust now that house prices have crashed. Senator Kerry deserves special blame in this story because he could never be bothered to pay attention to the housing bubble, even when he was running for president in 2004. I recall urging his campaign staffers to pay attention to the bubble. It was like talking to Barney Frank’s dining room table. Of course Robert Rubin was one of Kerry’s top economic advisers. Rubin was making tens of millions of dollars at Citigroup whose profits were derived largely from marketing subprime junk loans. So perhaps it is not surprising that Kerry had little interest in learning anything about the housing bubble. Still it is more than a bit infuriating that Senator Kerry and his colleagues would now be lecturing the country on the need for hard choices. If they could have been bothered to do their damn jobs just a few years ago, we would not be in this situation today. As a result of their failure, tens of millions of workers are unemployed or underemployed. Yet the senators, who are still drawing their paychecks, want the country to sacrifice even more. Maybe now they can be persuaded to learn a little economics.
Continue reading …Sprint’s Epic Touch 4G may be first US-bound Galaxy S II, arriving September 9th?
August 19, 2011 No Comment
Samsung is expected to unveil its US Galaxy S II lineup on August 29th, and if you have that date highlighted on your calendar for that very reason, this rumor will likely turn you ancy for the next ten days. We’re hearing from SprintFeed that the Samsung Epic Touch 4G , Sprint’s variant of the upcoming device, may win the race to market by launching on September 9th. It’s no surprise that the Now Network would beat T-Mobile, given whisperings that the Samsung Hercules won’t make it to stores until October 26th , but we’re still unsure of when to expect Big Red and Ma Bell. Regardless of if this report is accurate, the next two months are still gearing up to be rather exciting, wouldn’t you say? Sprint’s Epic Touch 4G may be first US-bound Galaxy S II, arriving September 9th? originally appeared on Engadget on Fri, 19 Aug 2011 17:44:00 EDT. Please see our terms for use of feeds . Permalink
Continue reading …Retina Display-equipped iPad 3 looking more and more likely for early 2012
August 19, 2011 No Comment
Well, the Wall Street Journal’s headline certainly isn’t going to surprise you — Apple Developing New iPad — that has been a safe assumption since the iPad 2 was announced. Rumors are circulating though (some, for quite a while) that are painting an increasingly convincing picture of a Retina Display -equipped slate shipping in early 2012. Reports are in that suppliers have already received Q4 orders for parts that may eventually find their way into Apple’s next tablet. Can we say for certain that the iPad 3 will hit shelves in Q1 of next year sporting a 2048 x 1536 screen? No, but it’s starting to look more and more likely. Retina Display-equipped iPad 3 looking more and more likely for early 2012 originally appeared on Engadget on Fri, 19 Aug 2011 18:07:00 EDT. Please see our terms for use of feeds . Permalink
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