Daily Digest 12/19 - Citi: New Credit Cards, Ingredient Costs Push Up Food Prices, China and Pakistan
- Citi Deals a New Deck of Credit Cards
- Mauldin: Kicking the Can Down the Road
- PIMCO Investment Outlook - Allentown
- Ingredient Costs Expected To Push Food Prices Up
- IMF Chief Worried About Europe Domino Effect
- German Obstructionism Heightens Euro Fears
- China, Pakistan To Formalize Another US $10 Bil In Deals
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The bosses are desperate for new revenue after a couple of years of writing off bad loans. President Obama signed legislation making it harder to raise interest rates and impose fees. Meanwhile, many customers are paying down high-interest debt and have sworn off the companies’ products in favor of debit cards. Oh, and they mostly hate that card companies cut many of their credit limits in a time of need and then reduced perks on some cards as if to rub salt in their wounds.
While the US Congress is certainly an adept player at that game, I think the world champions at the present time have to be the political and economic leaders of Europe. Today we look at the extent of the problem and how it could affect every corner of the world, if not played to perfection. Everything must go mostly right or the recent credit crisis will look like a walk in the Jardin des Tuileries in Paris in April compared to what could ensue.
PIMCO Investment Outlook - Allentown (solidswede)
We’re all Allentowners now. Granted, 90% of the workforce is still reporting for work on time, but our standard of living, our confidence in the future – we’re standing in line in Allentown. Lost in the policy debate surrounding the elections and the subsequent demonization of the Federal Reserve’s Quantitative Easing (“QE2”) policies has been any recognition of why we no longer live on Ronald Reagan’s shining hill or how we might possibly reclaim higher ground.
General Mills hasn’t raised food prices in 3 1/2 years. The maker of Bisquick, Betty Crocker, Pillsbury and Gold Medal flour has stated it will raise prices on 25% of it’s cereal line on Monday. Last month, McDonald’s said it is planning on raising prices in order to offest rising costs. Kellogg is expected to raise cereal prices along with Unilever and Nestle who have signaled increases are likely in the near future.
Dominique Strauss-Kahn appeared to endorse the idea of common euro bonds, saying they could be a useful tool, but added the political will to give power to the center of Europe was the main hurdle to their creation. "I am worried, and that's why I am urging the Europeans ... to provide a comprehensive solution because this piecemeal approach ... obviously doesn't work," Strauss-Kahn told Reuters. "The markets are just waiting for what's next."
Speaking in front of the German parliament in Berlin, Merkel sang the praises of the "extraordinary ideas of peace and freedom which provide the foundation of European unity." It is a legacy, she went on, "to which I feel personally beholden." Fine words, to be sure. But there are some in Germany who have found cause to doubt the sincerity of Merkel's commitment to the European Union. The German chancellor, after all, has become a stick in the deep mud of the ongoing euro crisis, one which has seen country after country fall victim to skyrocketing interest rates on government bonds, making borrowing on the international financial markets virtually impossible.
Boosting trade and investment have been the main focus of the first visit in five years by a Chinese premier to the nuclear-armed Muslim nation on the front line of the U.S.-led war on al-Qaida. Pakistan regards China as its closest ally and the deals are seen locally as incredibly important to a moribund economy, which was dealt a massive blow by catastrophic flooding this year and suffers from sluggish foreign investment.
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