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    Daily Digest 12/3 – The Return of Currency Wars, Fed To Stay Agressive In 2015

    by saxplayer00o1

    Wednesday, December 3, 2014, 4:30 PM

Economy

Russian Woes Worsen as Recession Looms With Banks in ‘Panic’

Russia’s economic crisis deepened as the government acknowledged it’s heading for recession and a former central banker spoke of “some panic” in the financial system as oil prices plunged.

China stocks surge on PBOC stimulus hopes

It came amid rumors that the People’s Bank of China (PBoC) may unveil another round of stimulus, according to Reuters, citing analysts, which could include a cut in the reserve requirements for banks.


Indian Bonds Rally as RBI Signals Policy Easing Early Next Year

Indian bonds rallied, pushing the 10-year yield to a 16-month low, as the central bank signaled it may ease policy in early 2015 after keeping borrowing costs unchanged at a meeting today.

BOJ’s Negative Yields Seen Reaching Five-Year Bond: Japan Credit

Kokusai Asset Management Co., which oversees Japan’s second-biggest bond fund, is preparing for central bank buying to drive yields below zero all the way out to five-year notes.

The Return of Currency Wars (Nouriel Roubini)

The recent decision by the Bank of Japan to increase the scope of its quantitative easing is a signal that another round of currency wars may be under way. The BOJ’s effort to weaken the yen is a beggar-thy-neighbor approach that is inducing policy reactions throughout Asia and around the world.

Central banks in China, South Korea, Taiwan, Singapore, and Thailand, fearful of losing competitiveness relative to Japan, are easing their own monetary policies – or will soon ease more.

Greek opposition wants debt from bailout cut

The leader of Greece’s popular left-wing opposition said Tuesday he will demand a reduction in the country’s debt from its bailout, if his party comes to power in a possible snap election early next year.

Fed to stay aggressive in 2015 as it battles ‘lowflation’: Morgan Stanley

“Markets no longer believe that central banks will be able to bring inflation back to target any time soon. The longer this lasts, the more self-fulfilling these prophecies become,” Fels said.

“This is why central banks have a strong interest in lifting inflation […] We think they have already started the battle against lowflation, but there is more to come,” he added.

Central Bank ‘Evil’ (Russia)

The Prosecutor General’s Office is looking into the Central Bank’s operations after a ruling party lawmaker accused it being an “enemy of the country” by supposedly driving down the ruble and plotting “evil” against Russia.

Deflation looms as Europe’s economic bugbear

Deflation can also worsen public debt and that’s not what Europe needs. Though the nominal amount of debt remains the same, it in effect grows because prices are lower.

Capital controls feared as Russian rouble collapses

It is extremely rare for a major country to collapse in this fashion, and the trauma is likely to have political consequences. “This has become disorderly. There are no real buyers of the rouble. We know that voices close to president Vladimir Putin want capital controls, and we cannot rule this out,” said Lars Christensen, at Danske Bank.

Colombia Welcomes Weakest Peso Since 2009, Cardenas Says

Colombian Finance Minister Mauricio Cardenas welcomed the recent selloff that has pushed the peso to the weakest since 2009, describing it as a “breath of fresh air” that will boost exports.

Gold & Silver

Click to read the PM Daily Market Commentary: 12/2/14

Provided daily by the Peak Prosperity Gold & Silver Group

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