Daily Archives: January 30, 2013

Financial Times: Other Countries Should Follow Germany’s Gold Repatriation Lead

"The Bundesbank's move is important: not for what it says about Germany's faith in French or American vaults; nor for the cost of shifting 674 tonnes of gold; but because it is a major victory for transparency in the gold market. Central banks are notoriously secretive about their gold-trading activities. Most report, on a monthly basis, their gold reserves to the International Monetary Fund. But these data fall a long way short of full transparency. They tell us nothing about derivative positions in the gold market -- for example, gold loans, agreements for future sales, or options transactions." Continue reading →

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Tripling in Chinese Debt to $1.7 Trillion Drags on Economy

"Chinese companies are spending more than ever to service debt after their borrowing almost tripled over five years, prompting strategists to warn of rising default risk and a threat to economic growth. Total short- and long-term borrowing by 3,895 publicly traded non-financial companies rose to almost $1.7 trillion in their latest filings, from $604 billion at the end of 2007, data compiled by Bloomberg show. Financing costs, including interest, on all forms of debt climbed to the highest level as a percentage of gross domestic product last year, according to Sanford C. Bernstein & Co." Continue reading →

Continue ReadingTripling in Chinese Debt to $1.7 Trillion Drags on Economy

China tells U.S. to slow money printing presses

"A senior Chinese official said on Friday that the United States should cut back on printing money to stimulate its economy if the world is to have confidence in the dollar. Asked whether he was worried about the dollar, the chairman of China's sovereign wealth fund, the China Investment Corporation, Jin Liqun, told the World Economic Forum in Davos: 'I am a little bit worried.' China is the biggest purchaser of U.S. Treasury bonds, using its enormous foreign currency reserves primarily to buy U.S. securities as a long-term investment." Continue reading →

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Antigua set to bypass US copyright law with WTO green-lit media, software sales website

"In a surprisingly legal move, the government of Antigua is planning to open a website selling media and software without paying any fees to American copyright holders. It comes after the US closed its market to Antiguan gambling companies. The small Caribbean nation once thrived on its gambling industry, which at one point employed 5 per cent of its people, TorrentFreak reports. When the US blocked the island's gambling companies from accessing American players, it pulled the rug out from under the whole industry. Antigua is now set to begin selling music, movies and software without having to pay a cent to the American firms holding copyrights on the wares." Continue reading →

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Feinstein “Assault Weapons” Bill: Give Government an Inch…

Last week, I wrote about President Barack Obama’s gun-control executive orders, and in it, I said, “You don’t have to be a firearms enthusiast to know that this isn’t a final triumph for gun-control advocates. It’s only the latest chapter.” My argument was that any time you give the government an inch, they will always [...]

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Treasury Gets a Citibanker

"There was a time when you had to be successful on Wall Street to become secretary of the Treasury. Now along comes presidential nominee Jack Lew, whose only business credential is a stint at the most troubled too-big-to-fail bank. During the darkest days of the financial crisis Mr. Lew served as the chief operating officer of Citigroup's Alternative Investments unit (CAI). CAI no longer exists. At the end of Mr. Lew's first quarter on the job, the unit reported a $358 million loss. Things got much worse after that but Citi stopped breaking out CAI results in its earnings releases. The unit was eventually shuttered and many of its assets were sold." Continue reading →

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At Bank of England, Carney to put growth at top of list

"The new Governor of the Bank of England has signalled that he will put growth at the heart of his approach to the job and is willing to see higher inflation for longer in order to support the economy. Using the US as an example, Mr Carney said economies needed to be allowed to reach an 'escape velocity' in which they were out of danger of slipping back into recession. That would suggest keeping interest rates lower for longer while considering further quantitative easing, indirect provision of monetary stimulus via the financial system." Continue reading →

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Mark Carney Leaves Canada With ‘Stealth QE’ Rising At Fastest Pace Since 2009

"As Mark Carney steps aside from his role at the Bank of Canada to undertake all manner of easy money in the UK, we thought a reflection on the 'stealth' QE that he has been engaged with, very much under the radar, in the US' neighbor-to-the-north was worthwhile. It seems quietly and with little aplomb, Carney's BoC has grown its balance sheet by over 21% YoY - the most since 2009. If that was not enough to make someone nervous, the quantity of Canadian government bonds on the BoC's balance sheet has grown at a remarkable 46% YoY! With Canada's CAD267bn debt due in 2013, we suspect this 'stealth' QE will continue to rise." Continue reading →

Continue ReadingMark Carney Leaves Canada With ‘Stealth QE’ Rising At Fastest Pace Since 2009

Japan welfare payments to be slashed ¥74 billion to root out the comfortably poor

"Welfare benefits will be slashed by ¥74 billion over a three-year period starting from fiscal 2013, after a government panel found that some people are making more on the dole than the average low-income person who is not spends on living costs, it was learned Sunday. The decision to lower standard benefit payments by 6.5 percent was made by welfare minister Norihisa Tamura and Finance Minister Taro Aso. The reduction will hit in August." Continue reading →

Continue ReadingJapan welfare payments to be slashed ¥74 billion to root out the comfortably poor