Daily Digest

Daily Digest 10/19 - China Warns About Currency War, The Gathering Storm, World Bank Pressured Over Fossil Fuel Loans

Tuesday, October 19, 2010, 10:41 AM
  • The Empire Strikes Back: China Daily Warns About Currency War, Blames Dollar
  • The “Gathering Storm" warning on global economy
  • China's not the villain if the West tries to debase its debt through QE
  • World Bank pressured over fossil fuel loans
  • Energy the cornerstone of Russian ties with Venezuela
  • Fuel supplies low as protests hit France
  • Must Watch Video on Bank Fraud
  • Oil's Not Well

Learn how to protect your wealth against the Three E forces using our 'What Should I Do?' guide

Economy

The Empire Strikes Back: China Daily Warns About Currency War, Blames Dollar (pinecarr)

You didn't think China was just going to do the rockaway and lean back, lean back, lean back. Nope - China Daily says: "A currency war is spreading as the dollar's value against major world currencies has continued to decline in recent days" and calmly confirms what everyone esle knows: "It is the dollar that triggered the currency war. Seemingly a market move, the depreciation of the dollar is actually active." Check to you, Tim Geithner and your currency manipulation report.

The “Gathering Storm" warning on global economy (pinecarr)

A group of top Fund Managers says the global economy is risking Doomsday, much worse than the events of the past three years. Eighteen investment experts have published their views in the book “The Gathering Storm."

Business RT spoke with co-author Patrick Young to ask what governments and central banks are doing wrong.

China's not the villain if the West tries to debase its debt through QE (pinecarr)

The annual meetings of the International Monetary Fund in Washington are supposed to generate some kind of resolution. Instead, all we got was posturing and a slew of pious speeches saying that "co-operation is crucial".

What is now clear is that some of the world's leading economies are deliberately debasing their currencies in order to make their exports more competitive and lower the real value of the massive debts they owe the rest of the world.

World Bank pressured over fossil fuel loans (pinecarr)

With new figures showing a record World Bank funding for projects relying on coal power and other fossil fuels, the issue of reforming the institution's energy lending was again a hot topic at the recently concluded World Bank and International Monetary Fund annual meetings.

The bank lent US$3.4 billion to coal projects, or one quarter of all its energy lending, according to data released last month. If a transmission project meant to connect coal-powered stations to the grid in India is included, that number rises to about $4.4 billion, according to an analysis by the NGO Bank Information Center (BIC).

Energy the cornerstone of Russian ties with Venezuela (pinecarr)

The ten deals signed up to by Russia and Venezuela, during the visit by President Hugo Chavez to Moscow, underline the key role of energy in the ties between the two nations.

Fuel supplies low as protests hit France (pinecarr)

Frequent strikes in the last few weeks have hobbled French trains and airports, closed schools and docks, and left garbage piling up in the southern port of Marseille. But now the airline industry is getting worried, after all of France's 12 fuel-producing refineries went on strike and many depots were blocked by protesters. Police were called in to force three crucial fuel depots to reopen Friday, including one outside Marseille.

The Civil Aviation authority sent out an advisory Friday night to airlines requiring short- and medium-haul flights to Paris' Charles de Gaulle airport …quot; one of Europe's key hubs …quot; to arrive with enough fuel to get home, spokesman Eric Heraud said.

Must Watch Video on Bank Fraud (pinecarr)

Wonder why the banks are plummeting? They were never healthy in the first place, they were built upon multiple levels of fraud.

Oil's Not Well (Ilene)

What I love about investors and the MSM in this country is their ability to completely ignore the fact that, ultimately, someone must consume the oil that is leading the inflationary drive in the economy. Actually, we shouldn’t blame oil (I said as much last week) but, as I also said last week, QE is the wrong kind of inflation because we are not giving any money to the workers. Ultimately, it’s the workers who have to buy food and fuel….

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

10 Comments

saxplayer00o1's picture
saxplayer00o1
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Re: Daily Digest 10/19 - China Warns About Currency War, ...

"(Reuters) - Atlanta Federal Reserve Bank President Dennis Lockhart said on Tuesday that further easing by the Fed has to be large enough to help boost demand, and purchases of $100 billion of securities a month would be a possibility.

"If we're going to pursue another round of quantitative easing, it has to be a large enough number to make a difference," Lockhart said in an interview on CNBC.

"As a monthly number ($100 billion) is fairly consistent with what we did before, and so I think it would certainly be in the range of numbers one might consider ... but if you were talking about $100 billion as simply the overall program, I think that's too small," he said."

 

"New numbers posted today on the Treasury Department website show the National Debt has increased by more than $3 trillion since President Obama took office.

The National Debt stood at $10.626 trillion the day Mr. Obama was inaugurated. The Bureau of Public Debt reported today that the National Debt had hit an all time high of $13.665 trillion.

The Debt increased $4.9 trillion during President Bush's two terms. The Administration has projected the National Debt will soar in Mr. Obama's fourth year in office to nearly $16.5-trillion in 2012. That's more than 100 percent of the value of the nation's economy and $5.9-trillion above what it was his first day on the job."

"Oct. 19 (Bloomberg) -- California, the U.S. state with the largest public-pension fund, faces liabilities that may exceed five times its annual tax revenue within two years unless lawmakers rein in benefits, according to a study.

To keep their promises to retirees, the California Public Employees Retirement System, the biggest plan, the California State Teachers Retirement System, the second-largest, and the University of California Retirement System may have combined liabilities of more than 5.5 times the state’s annual tax revenue by fiscal 2012, according to the study released today by the Milken Institute. Levies are forecast to reach about $89 billion in the year that began July 1.

Debts to government retirees including those in California, the biggest state by population, have grown into a national crisis as pension plans strive to meet obligations to more than 19 million active and retired firefighters, police officers, teachers and other state workers. Fewer than half the plans had assets to cover 80 percent of promised benefits in fiscal 2009, according to data compiled for last month’s Cities and Debt Briefing hosted by Bloomberg Link.

“California simply lacks the fiscal capacity to guarantee public-pension payments, particularly given the wave of state employees set to retire” in future years, said researchers Perry Wong and I-Ling Shen in the Milken report. “Structural shifts, coupled with the financial design and the accounting practices of state pension funds, all point to the fact that reform is imperative.”

Driven by Demographics

The state’s pension costs are being driven in part by demographics such as an aging workforce and longevity gains among retirees, as well as an increasing demand for government public services, the researchers said."

"More than 150 neighborhood council Budget Representatives on Saturday heard the City’s Administrative Officer Miguel Santana report that the current city budget … which took effect July 1 … is already in a $63 million hole.

Santana told the neighborhood councils that the shortfall could be covered by the City’s reserve and unappropriated balance accounts but that agencies needed to engage in even more fiscal discipline because the deficit projected for next year is at least $318 million."

............................4A) Report: Los Angeles's $63.7 million 1st quarter deficit caused by delays

"Much has been made of retiring Mayor Richard Daley's plan to draw down reserve funds to balance next year's city budget and how it could burden his successor.

But the chairman of the Finance Committee, Ald. Ed Burke, today talked about a far larger problem. One in four pension funds for city workers will go broke in the next decade, if current funding levels continue and markets don't improve, and all will be belly up by 2032 if nothing gives.

"It's similar to watching the house burn down without turning on the fire hydrant," said Burke, 14th, during the first day of hearings on Daley's proposed $6.15 billion budget. "At the present time, the city pension funds are actually selling assets to meet obligations.""

  • Other news, headlines and opinion:

US Treasury chief Timothy Geithner says America will not engage in dollar devaluation

Geithner Weak Dollar Seen as US Recovery Route Versus BRICs

Korea strives to contain fallout of currency war

PBOC's 'Vicious Cycle' Worsened by Fed, Yu Says: China Credit

Japan Says Economy Weakening As Strong Yen Hits and Japan Cuts Economic Assessment on Strenghtening Yen, Easing Global Demand

Commodities to Rally on Fed 'Game Changer,' UBS Says

Foreclosure Crisis Triggers Debate on Role of Mortgage Registry

HSBC May Face $5 Billion Cost From Foreclosures, Canaccord Says

Mortgage Buybacks May Cost Lenders $120 Billion, JPMorgan Says

Rehn Says Greece May Need to Do More to Meet 2011 Deficit Goal

Greek Government Announces EUR2.6 Billion Jobs Package

California state parks in dire straits

Lehman Bankruptcy Fees Top $1 Billion

Nearly 1000 LAUSD workers to lose jobs on Nov. 30 (Los Angeles)

Investors Should Cut `Frothy' China Property Stake, Gave Says

South Africa's Gordhan Warns of Global 'Trade War'

Natomas schools' choice: Cut, or see state takeover (California)

China Raises Benchmark Rates for First Time Since 2007

Fuel Short, Flights Canceled as France's Strikes Intensify

Generation Homeless: The New Faces of an Old Problem

Banks Face Mortgage Scrutiny as $49 Billion in Value Vanishes

A "Watershed Event" for Bernanke: The Fed Is "Pushing Water with a Fork," Harrison Says (Tech Ticker Video)

Foreclosures Sales, REO Inventories Increase Along West Coast: Report

r's picture
r
Status: Gold Member (Offline)
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Posts: 262
Re: Daily Digest 10/19 - China Warns About Currency War, ...

Here is a NY Times video showing "how banks use securities lending to make a profit at no risk to themselves, while their customers cover their losses":

http://video.nytimes.com/video/2010/10/18/business/1248069197408/a-finan...

http://video.nytimes.com/video/2010/10/18/business/1248069197408/a-finan...

nickbert's picture
nickbert
Status: Diamond Member (Offline)
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Posts: 1208
SNL clip - Obama & Hu Jintao.... hilarious!

For those who may have missed it, here's a terrific SNL skit with "Obama" and "Hu Jintao" having a conference about the monetary policy and the debt:

http://www.hulu.com/watch/110317/saturday-night-live-china-cold-open

 

- Nickbert

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aggrivated
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Posts: 543
Re: Daily Digest 10/19 -Geithner says US not 2 devalue $ ...

Geithner's comments on devaluation of the dollar gave me a flashback to my youth and hearing Pres. Bush Sr. saying 'Read my lips--no new taxes'! 

rjs's picture
rjs
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Re: Daily Digest 10/19 - China Warns About Currency War, ...

The New Tax Man: Big Banks And Hedge Funds - Nearly a dozen major banks and hedge funds, anticipating quick profits from homeowners who fall behind on property taxes, are quietly plowing hundreds of millions of dollars into businesses that collect the debts, tack on escalating fees and threaten to foreclose on the homes of those who fail to pay. The Wall Street investors, which include Bank of America and JPMorgan Chase & Co., have purchased from local governments the right to collect delinquent taxes on several hundred thousand properties, many in distressed housing markets, the Huffington Post Investigative Fund has found. In many cases, the banks and hedge funds created new companies to do their bidding. They gave the companies obscure, even whimsical names and used post office boxes as their addresses, masking Wall Street's dominant new role as a surrogate tax collector.

 
In exchange for paying overdue real estate taxes, the investors gain legal powers from local governments to collect the debt and levy fees. At first, property owners may owe little more than a few hundred dollars, only to find their bills soaring into the thousands. In some jurisdictions, the new Wall Street tax collectors also chase debtors over other small bills, such as for water, sewer and sidewalk repair.
VIDEO by Lagan Sebert
The Big Business Wall Street Won't Discuss Full Video

Some states allow the investors to tack on as much as 18 percent interest and a passel of legal fees and other charges. When property owners fail to make full payment, the investors can sue to foreclose - in some states within as little as six months.

 

jhart5's picture
jhart5
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Posts: 89
Re: Daily Digest 10/19 - China Warns About Currency War, ...

The two charts below tell the whole story. In the space of a decade, we went from a country of homeowners with equity in their homes to a country where wide swaths of the population are deeply underwater. Nothing like a little delusion mixed with a lot of fraud. - Aquaman

Underwater Homes, Q4 2000

Underwater Homes, Q4 2009

pinecarr's picture
pinecarr
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Re: Daily Digest 10/19 - China Warns About Currency War, ...

jhart5, those two charts are incredible!  Talk about a picture being worth a thousand words!!

Craigievos's picture
Craigievos
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Re: Daily Digest 10/19 - China Warns About Currency War, ...

http://www.nytimes.com/2010/10/20/business/global/20rare.html?_r=2&hp

jhart5's picture
jhart5
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Posts: 89
Re: Daily Digest 10/19 - China Warns About Currency War, ...

Big banks, hedge funds hide roles in foreclosure schemes

Huffington Post Investigative Fund - By Fred Schulte

Nearly a dozen major banks and hedge funds, anticipating quick profits from homeowners who fall behind on property taxes, are quietly plowing hundreds of millions of dollars into businesses that collect the debts, tack on escalating fees and threaten to foreclose on the homes of those who fail to pay.

The investors, which include Bank of America and JPMorgan Chase, have purchased from local governments the right to collect delinquent taxes on several hundred thousand properties, many in distressed housing markets, the Huffington Post Investigative Fund has found.

Condensed : http://www.denverpost.com/business/ci_16372174?source=rss

http://www.huffingtonpost.com/2010/10/18/the-new-tax-man-big-banks_n_766169.html

dickey45's picture
dickey45
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Posts: 77
Re: Daily Digest 10/19 - China Warns About Currency War, ...

"The investors, which include Bank of America and JPMorgan Chase, have purchased from local governments the right to collect delinquent taxes on several hundred thousand properties, many in distressed housing markets"

Ewwwww, that is pretty darn gross. Reminds me of vultures, on steroids.

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