Mainstream News

European Union Stripped of AAA Credit Rating at S&P

"The European Union lost its top credit rating from Standard & Poor’s, which cited the deteriorating creditworthiness of the bloc’s 28 member nations. Ratings remain under pressure more than four years after the outbreak of the European debt crisis, which led the EU to offer emergency financing to Greece, Ireland, Portugal, Spain and Cyprus to shore up their bonds and banks. European Central Bank President Mario Draghi’s pledge to do what it takes to save the euro has helped stabilize debt markets, while deficits and debt in most euro-area countries remain well above the limits set for membership in the single currency." Continue reading →

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Saving Europe’s banks: EU gets landmark deal

"Europe has agreed the core elements of a banking union that mark the most significant pooling of national power since the birth of the euro. European Union leaders meeting in Brussels Thursday will sign off a compromise deal hammered out overnight by their finance ministers after months of difficult negotiations. It will then go to European lawmakers for final approval before May 2014. The banking union is central to the eurozone's response to future financial crises. The aim is to stop bank collapses from trashing national economies -- a fate Ireland suffered in 2010 -- and destabilizing the euro." Continue reading →

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China credit crisis fears as central bank injects funds

"China’s central bank has rushed to pump money into the stalling banking system but markets across Asia still fell sharply amid fears that the world’s second-largest economy faces a credit crisis. State media in China had reported that the PBOC has unexpectedly pumped $33bn (£20bn) into the domestic money market through what it refers to as 'short-term liquidity operation'. Fears over a looming Chinese debt crisis spurred by a poorly regulated and opaque financial system stoked fears over the summer that the Asian powerhouse could finally be on the brink of a sharp slowdown in growth." Continue reading →

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Bank of Japan “Very Interested” in Bitcoin: Kuroda

"The Bank of Japan is 'very interested' in the online virtual currency Bitcoin, Governor Haruhiko Kuroda said Friday. The central bank's Institute of Monetary and Economic Studies is studying it, Kuroda said at a regular news conference. 'Compared with traditional ways of money transfers and existing electronic money, Bitcoin has both similar and different aspects,' Kuroda said. Central banks around the world are closely watching Bitcoin, the value of which has been swinging wildly due to speculative trading. The BOJ currently has no plans to take action on the situation surrounding Bitcoin, Kuroda said." Continue reading →

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Overstock CEO: money ’too important to leave to government officials’

"Overstock.com Inc., an online discount retailer, is preparing to accept the virtual currency bitcoin as payment in the second half of 2014, according to Chief Executive and Chairman Patrick Byrne. The news was first reported by the website newsBTC, and confirmed in a Thursday morning phone interview with Byrne. The project is in an early stage, with no decision yet on whether Overstock.com would work with bitcoin companies to allow bitcoin payments or create its own system. A team of six to 12 people is expected to work on bitcoin payments at the company, said Byrne." Continue reading →

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What Happened to the Fed’s Trillions? Back on Deposit…at the Fed!

"So you can understand why they wanted to have the tool. Now the question is whether or not this tool as it was implemented throughout this financial crisis, and aftermath, has exacerbated the problems with the credit channel. A bank can decide, 'Do I want to give a three-year loan to a risky borrower, or do I want to get 25 basis points at the Federal Reserve? I'm really risk averse right now. I don't really want to lend to anybody so I'd rather take my 25 basis points.' So I believe that at the margin, this has affected the credit channel, the effectiveness of the credit channel." Continue reading →

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Yellen Strikes Out

"Mrs. Yellen insisted that she supports 'transparency and openness on the part of the Fed.' She claimed that in terms of the 'range of information and the timeliness of that information, we are one of the most transparent central banks in the world.' That’s not only irrelevant but wan. She then declared that she would not support 'a requirement — any requirement — that would diminish the independence of the Federal Reserve in implementing, and deciding on implementing, monetary policy.'" Continue reading →

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Chinese Bitcoin crackdown sparks revenge cyber-attack

"China’s central bank is thought to have been targeted in a revenge cyber-attack by investors infuriated at government attempts to destroy the local Bitcoin market. As the yuan-denominated value of Bitcoins collapsed today, the website and official, Twitter-style weibo account of the People’s Bank of China suffered a series of crashes believed to have been caused by hackers. Although the attacks were not claimed by any group, they followed a decision by Beijing earlier this week that will effectively shut down Bitcoin trading on China’s online exchanges. Bitcoins have proved exceptionally popular in China." Continue reading →

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Bitcoin Value Sinks After Chinese Exchange Blocked

"China’s biggest Bitcoin exchange was forced to stop accepting deposits in the Chinese currency on Wednesday, sending the price of the virtual money tumbling in one of its biggest markets globally. The development comes less than two weeks after China’s central bank and four other government agencies that regulate finance and technology issued a joint announcement banning Chinese financial institutions from dealing in the virtual currency. By Wednesday evening, the Shanghai-based BTC was quoting Bitcoins at about 2,300 renminbi, or about $380, apiece. That was nearly 40 percent lower than where they had traded on Tuesday." Continue reading →

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U.S. Treasury cautions Bitcoin businesses on legal duties

"Treasury's Financial Crimes Enforcement Network (FinCEN) has sent 'industry outreach' letters to about a dozen firms, regarding potential anti-money laundering compliance obligations related to Bitcoin businesses, FinCEN spokesman Steve Hudak told Thomson Reuters' regulatory information service Compliance Complete. The letters have had a 'chilling effect' on Bitcoin businesses, which are intimidated by the threat of civil and criminal sanctions for non-compliance, said Jon Matonis, executive director of the Bitcoin Foundation, an advocacy group. The firms, he said, may effectively be 'put out of business in an extrajudicial manner.'" Continue reading →

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