Daily Digest

Daily Digest 1/9 - Risks from U.S. Debt, Banks Slow Foreclosure Pace, BP to Cut Alaska Oil Production

Sunday, January 9, 2011, 12:00 PM
  • Greenspan Warns of Risks From U.S. Debt
  • U.S. Stock Investors Ready For Earnings Start
  • Yellen Says Fed Asset Purchases Avert Deflation, to Create 3 Million Jobs
  • A Tale of 2 Employment Surveys, at a Glance
  • Facing Scrutiny, Banks Slow Pace of Foreclosures
  • BP to Cut Alaskan Oil Production
  • Duke Is Said to Be Near Deal to Buy Progress Energy

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Economy

Greenspan Warns of Risks From U.S. Debt (phil)



In an interview Friday with The Wall Street Journal, Mr. Greenspan said that eventually Congress would pass a budget that includes many proposals by a White House debt-reduction panel. "I think that the type of budget agreement that was put together by Alan Simpson and Erskine Bowles is the type of budget that will be passed by Congress," Mr. Greenspan said. "The only question is, will it be before or after the bond-market crisis."

U.S. Stock Investors Ready For Earnings Start



Expectations for some retailers may come down following largely disappointing holiday-sales growth, but Wall Street analysts have been busily raising their profit targets across the board. The biggest jump is expected to come from financial services, with profit growth of 250%, according to Standard & Poor’s, followed by energy at 118%, materials at 70% and consumer discretionary at 63%.

Yellen Says Fed Asset Purchases Avert Deflation, to Create 3 Million Jobs



Yellen gave the most detailed accounting yet of the benefits the central bank sees from its November decision to start a second round of asset buying, adding her voice to a defense of the policy by Chairman Ben S. Bernanke and other officials. Republican lawmakers and officials in China, Germany and Brazil have criticized the policy, saying it threatens to weaken the dollar and stoke asset-price bubbles.

A Tale of 2 Employment Surveys, at a Glance



The number of unemployed fell by 556,000 to 14.5 million last month, according to the household survey. Slightly more than half, or 297,000, of those people said they had found jobs. That's many more than the 103,000 new jobs that employers said they created. The two figures vary month to month but over time they tend to even out. The rest of the drop in the number of unemployed came from people who left the work force. As jobs remain scarce, many people who are out of work and have looked for months give up.

Facing Scrutiny, Banks Slow Pace of Foreclosures



The Obama administration, in its most recent housing report, said foreclosure activity fell 21 percent in November from October, the biggest monthly decline in five years. Here in Phoenix, foreclosures fell by more than a third in the same period, reflected in the severe drop in foreclosed homes being auctioned on the courthouse plaza. “There’s no product, just nothing to buy,” complained Sean Waak, an agent for investors, during a recent auction.

Energy

BP to Cut Alaskan Oil Production



Michelle Egan, a spokeswoman for Alyeska, said that Saturday morning at 8:15, personnel at pump station 1 discovered oil leaking into the station's booster pump building. The leak appeared to be from a section of piping at the station that is encased in concrete. Alyeska shut down the Trans Alaska Pipeline at 8:50 a.m. and crews are currently on site to assess the situation and isolate the source of the leak.

Duke Is Said to Be Near Deal to Buy Progress Energy



Duke is weighing a stock merger valuing Raleigh, North Carolina-based Progress at slightly more than its Jan. 7 market value of $13.1 billion, and may be prepared to announce a deal by tomorrow, said one of the people, who spoke on condition of anonymity because the talks are private. Progress’s market capitalization is based on the last closing price of $44.72 on the New York Stock Exchange.

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4 Comments

DavidC's picture
DavidC
Status: Silver Member (Offline)
Joined: Sep 29 2008
Posts: 243
Re: Daily Digest 1/9 - Risks from U.S. Debt, Banks Slow ...

Phil, Chris,

Thanks fot the "Greenspan Warns of Risks From U.S. Debt" video link. I have to say that watching Greenspan and his repsonses made me feel ill!

DavidC

rjs's picture
rjs
Status: Gold Member (Offline)
Joined: Aug 8 2009
Posts: 445
Re: Daily Digest 1/9 - Risks from U.S. Debt, Banks Slow ...

re: tale of 2 surveys:

the bottom line is that the workforce is the lowest it's been in 27 years...over the past year the economy has only added back 1.1 million of the 8.4 million jobs that were lost during the recession; however, just to create jobs to make up for the increase in the population, we should be adding at least 1.5 million jobs a year; thus at the rate jobs are being added in this "recovery", the labor force participation rate will continue to shrink, and we'll never get out of this hole...

Johnny Oxygen's picture
Johnny Oxygen
Status: Diamond Member (Offline)
Joined: Sep 9 2009
Posts: 1443
Re: Daily Digest 1/9 - Risks from U.S. Debt, Banks Slow ...

 

"The probability that we will go through the next two or three years with no bond-market problems, no inflation problems, is probably better than 50-50," he said. "But not much."

Mr. Greenspan said he thought the economy was gaining momentum, with the strongest signals of growth coming since the middle of last month.

He credited the "wealth effect," which refers to an increase in spending that accompanies escalating stock prices.

Mr. Greenspan also defended his legacy, saying he had answered his critics with facts.

"If they prove I'm wrong, I'll change," he said.

The cult of Keynesian is still going strong.

 

Denny Johnson's picture
Denny Johnson
Status: Gold Member (Offline)
Joined: Aug 13 2008
Posts: 348
Re: Daily Digest 1/9 - Risks from U.S. Debt, Banks Slow ...

The Bill Daley Problem by Simon Johnson

http://baselinescenario.com/

Another fox in the henhouse.

 

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