All the talk about green shoots got the gardeners out this last few weeks . The markets have been fed a lot of fertilizer over a 4 month period. It's always the experts that get things moving. Then they appear to become complacent and send out the kids do do their part.
Of course the kids know everything and get straight to work. The peas are doing well wow look at the carrots and those onions are champions . So they invest in the top performers by adding a little feed here and there. Building up a nice portfolio for themselves. The big boy's like Goldman sucks and a few others tell them they did well with their choices and would be well fed this summer. They tell the kids to hold on for a while and that they will reap the benefits of their work. Little did the kids know that the big boys were starting to eat their early seeds....... and little less did they tell them where the fertilizer and plant food were kept. Perhaps the kids found the roundup and thought that's the stuff to use on our portfolios (some like to round things up)
Beware this garden could end up eating you
Monday, June 22, 2009
Meltdown coming ?
With this happening it tells a story.
Insiders Exit Shares at the Fastest Pace in Two Years .
Insiders Exit Shares at the Fastest Pace in Two Years .
This Guy is wrong
I noted this video on youtube today. It's by Jim and his stance on buying American . We have also seen of late a bit of a drive around the world of people advocating this idea to help their economies. Well history has shown that this in fact kills not only country economies but also global trade. Usually it's implemented by placing taxes or quotas on imports. What Jim asks for is just buy American . He says dont buy crap, thats ok nobody needs crap. He seems to think that there is an imbalance in wages between the 3rd world and the US He's right again. But he has to realize that as bad and low as the wages are in the 3rd world countries the US was paying it's workers to much too. As for no one is able to make good things as well as the US, he's very wrong. There are millions of examples of where the rest of the world are streets ahead of the US. The Auto industry just one example.
Has the World started the protectionist route ? I say most definitely yes. How you might ask. Well the most obvious thing is the bailouts of banks and most big business . The latest example is the state subsidies battle between the to big airline makers. Another protectionist route is also raising it's head and that is the battle ground of the Exchange Rates . That can be hidden in the quantitative easing that's going on now. Some think that the arguments for protectionism are good and will save them from the lows of a recession and carry them through . It could help in a short downturn but what the world is facing is something quite different . History shows that Protectionism has failed in a big way. Protectionism has also been accused of being one of the major causes of war.
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Yen, Dollar Rise on Iran Concern, World Bank Recession Forecast
By Yoshiaki Nohara and Ron Harui
June 22 (Bloomberg) -- The yen and the dollar gained as concern the political tension in Iran is worsening and a World Bank report saying the global recession will be deeper than earlier predicted fanned demand for the currencies as a refuge.
The yen strengthened versus all 16 major currencies after Iran’s government detained five members of former President Ali Akbar Hashemi Rafsanjani’s family and said at least 17 people had been killed during protests over this month’s disputed election. The Australian and New Zealand dollars and South Africa’s rand fell the most against the greenback and the yen after the World Bank also warned that a flight of capital from developing nations will increase the number of jobless.
“There is growing uncertainty over what will happen in Iran that seems to be sparking risk aversion,” said Ryohei Muramatsu, manager of Group Treasury Asia in Tokyo at Commerzbank AG, Germany’s second-largest bank. “This would be supportive of the yen.”
The yen advanced to 133.24 per euro as of 7:49 a.m. in London from 134.18 in New York last week, after rising as high as 133.02. Japan’s currency strengthened to 96.13 per dollar from 96.27. The dollar climbed to $1.3855 per euro from $1.3937.
Japan’s currency gained 1 percent to 76.80 versus the Australian dollar and climbed 1 percent to 61.26 to the New Zealand dollar as splits within Iran’s ruling elite deepened. Parliament Speaker Ali Larijani yesterday criticized the top election body for siding with President Mahmoud Ahmadinejad and said most Iranians don’t accept Ahmadinejad’s electoral victory.
World Bank Forecast
The yen typically strengthens in times of financial turmoil as Japan’s trade surplus makes the currency attractive as it means the nation does not have to rely on overseas lenders. The dollar benefits as it is the world’s reserve currency.
The World Bank forecast in a report that the world economy will contract 2.9 percent this year, compared with a previous estimate of a 1.7 percent decline.
Japan’s gross domestic product will shrink 6.8 percent this year, more than the Washington-based bank’s prediction in March of a 5.3 percent decline, while the euro area will shrink 4.5 percent, almost twice as much as the previous forecast for a 2.7 percent contraction.
“The reality is that economic numbers speak for themselves, and the data in Europe has been more negative than elsewhere,” said Mitul Kotecha, Hong Kong-based head of global foreign- exchange strategy at Calyon. “Equity markets are really struggling at the moment. When equity markets struggle, the U.S. dollar generally benefits.”
Dollar Index
The Dollar Index, which tracks the greenback against the currencies of six major U.S. trading partners including the euro, yen and pound, gained 0.3 percent to 80.48.
The yen also rose as rising volatility damped demand for so-called carry trades. Volatility implied by one-month euro options against the yen climbed to 17.6 percent from 17.1 percent on June 19, indicating a greater risk of exchange-rate fluctuations that can erode profit on such trades.
In carry trades, investors get funds in a country with relatively low borrowing costs and invest in another with higher interest rates. The risk is market moves can erase those profits. The benchmark interest rate is 0.1 percent in Japan, compared with 3 percent in Australia and 2.5 percent in New Zealand.
Asian Currencies
Indonesia’s rupiah led Asian currencies lower as concern the global slump will be prolonged curbed demand for emerging- market assets.
“Markets are cautious about the global growth story,” said Thio Chin Loo, a senior currency analyst at BNP Paribas SA in Singapore. “The outlook is mixed and I don’t expect it to clear up for the next few days.”
Foreign investors sold $42 million more Indonesian stocks than they bought last week, and cut their holdings of local- currency bonds to 86.4 trillion rupiah ($8.3 billion) as of June 16, from 89 trillion rupiah on June 5, government and stock exchange data showed.
The rupiah fell 0.5 percent to 10,455 per dollar, according to data compiled by Bloomberg. It dropped 2.9 percent last week. India’s rupee lost 0.7 percent to 48.44 per dollar.
Analyst forecasts about the dollar have become the most scattered in two years, driving up foreign-exchange price swings and increasing risks that trading strategies and corporate hedges will backfire.
Redtower Asset Management, an Aberdeen, Scotland, investment adviser, sees the currency strengthening to $1.16 per Euro by year’s end, from $1.3906 today, as the world economy recovers from the first global recession since World War II. Standard Chartered Plc predicts a more stable economy will weaken the dollar to $1.55 as the Federal Reserve keeps its benchmark interest rate near zero to sustain growth, prompting investors to sell greenbacks for higher-returning assets.
Rising Volatility
The 39-cent gap between the high and low calls in Bloomberg’s strategist survey is almost double August 2007’s 20- cent divide. Wider fluctuations increase the risk for so-called carry trades, where money borrowed from countries with low rates is used to invest for higher yields. A move to unwind such investments probably would drive down the Brazilian real, South African rand and other developing nations’ currencies.
“It’s usually in this environment when volatility starts to pick up, before you have a real big move toward one camp,” said Paresh Upadhyaya, who helps manage $21 billion in currencies as senior vice president at Putnam Investments in Boston. “The dollar’s at a critical juncture, and to me it’s a sign we’re going to see a more significant move one way or the other.”
To contact the reporter on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net; Ron Harui in Singapore at rharui@bloomberg.net. Last Updated: June 22, 2009 02:53 EDT
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June 22 (Bloomberg) -- The yen and the dollar gained as concern the political tension in Iran is worsening and a World Bank report saying the global recession will be deeper than earlier predicted fanned demand for the currencies as a refuge.
The yen strengthened versus all 16 major currencies after Iran’s government detained five members of former President Ali Akbar Hashemi Rafsanjani’s family and said at least 17 people had been killed during protests over this month’s disputed election. The Australian and New Zealand dollars and South Africa’s rand fell the most against the greenback and the yen after the World Bank also warned that a flight of capital from developing nations will increase the number of jobless.
“There is growing uncertainty over what will happen in Iran that seems to be sparking risk aversion,” said Ryohei Muramatsu, manager of Group Treasury Asia in Tokyo at Commerzbank AG, Germany’s second-largest bank. “This would be supportive of the yen.”
The yen advanced to 133.24 per euro as of 7:49 a.m. in London from 134.18 in New York last week, after rising as high as 133.02. Japan’s currency strengthened to 96.13 per dollar from 96.27. The dollar climbed to $1.3855 per euro from $1.3937.
Japan’s currency gained 1 percent to 76.80 versus the Australian dollar and climbed 1 percent to 61.26 to the New Zealand dollar as splits within Iran’s ruling elite deepened. Parliament Speaker Ali Larijani yesterday criticized the top election body for siding with President Mahmoud Ahmadinejad and said most Iranians don’t accept Ahmadinejad’s electoral victory.
World Bank Forecast
The yen typically strengthens in times of financial turmoil as Japan’s trade surplus makes the currency attractive as it means the nation does not have to rely on overseas lenders. The dollar benefits as it is the world’s reserve currency.
The World Bank forecast in a report that the world economy will contract 2.9 percent this year, compared with a previous estimate of a 1.7 percent decline.
Japan’s gross domestic product will shrink 6.8 percent this year, more than the Washington-based bank’s prediction in March of a 5.3 percent decline, while the euro area will shrink 4.5 percent, almost twice as much as the previous forecast for a 2.7 percent contraction.
“The reality is that economic numbers speak for themselves, and the data in Europe has been more negative than elsewhere,” said Mitul Kotecha, Hong Kong-based head of global foreign- exchange strategy at Calyon. “Equity markets are really struggling at the moment. When equity markets struggle, the U.S. dollar generally benefits.”
Dollar Index
The Dollar Index, which tracks the greenback against the currencies of six major U.S. trading partners including the euro, yen and pound, gained 0.3 percent to 80.48.
The yen also rose as rising volatility damped demand for so-called carry trades. Volatility implied by one-month euro options against the yen climbed to 17.6 percent from 17.1 percent on June 19, indicating a greater risk of exchange-rate fluctuations that can erode profit on such trades.
In carry trades, investors get funds in a country with relatively low borrowing costs and invest in another with higher interest rates. The risk is market moves can erase those profits. The benchmark interest rate is 0.1 percent in Japan, compared with 3 percent in Australia and 2.5 percent in New Zealand.
Asian Currencies
Indonesia’s rupiah led Asian currencies lower as concern the global slump will be prolonged curbed demand for emerging- market assets.
“Markets are cautious about the global growth story,” said Thio Chin Loo, a senior currency analyst at BNP Paribas SA in Singapore. “The outlook is mixed and I don’t expect it to clear up for the next few days.”
Foreign investors sold $42 million more Indonesian stocks than they bought last week, and cut their holdings of local- currency bonds to 86.4 trillion rupiah ($8.3 billion) as of June 16, from 89 trillion rupiah on June 5, government and stock exchange data showed.
The rupiah fell 0.5 percent to 10,455 per dollar, according to data compiled by Bloomberg. It dropped 2.9 percent last week. India’s rupee lost 0.7 percent to 48.44 per dollar.
Analyst forecasts about the dollar have become the most scattered in two years, driving up foreign-exchange price swings and increasing risks that trading strategies and corporate hedges will backfire.
Redtower Asset Management, an Aberdeen, Scotland, investment adviser, sees the currency strengthening to $1.16 per Euro by year’s end, from $1.3906 today, as the world economy recovers from the first global recession since World War II. Standard Chartered Plc predicts a more stable economy will weaken the dollar to $1.55 as the Federal Reserve keeps its benchmark interest rate near zero to sustain growth, prompting investors to sell greenbacks for higher-returning assets.
Rising Volatility
The 39-cent gap between the high and low calls in Bloomberg’s strategist survey is almost double August 2007’s 20- cent divide. Wider fluctuations increase the risk for so-called carry trades, where money borrowed from countries with low rates is used to invest for higher yields. A move to unwind such investments probably would drive down the Brazilian real, South African rand and other developing nations’ currencies.
“It’s usually in this environment when volatility starts to pick up, before you have a real big move toward one camp,” said Paresh Upadhyaya, who helps manage $21 billion in currencies as senior vice president at Putnam Investments in Boston. “The dollar’s at a critical juncture, and to me it’s a sign we’re going to see a more significant move one way or the other.”
To contact the reporter on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net; Ron Harui in Singapore at rharui@bloomberg.net. Last Updated: June 22, 2009 02:53 EDT
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