Here are my Top 10 links from around the Internet at 10am. I welcome your additions and comments below or please send suggestions for Thursday's Top 10 at 10 to bernard.hickey@interest.co.nz 1. Strategic decision due 'shortly' - Perpetual Trust has told Adam Bennett at the NZHerald that a decision is due shortly on Strategic Finance's situation, which could include either receivership or a Hanover-style debt-for-equity swap, says McDouall Stuart analyst John Kidd.

The company's management is in negotiations with trustee Perpetual Trust over Strategic's future and Perpetual's Matthew Lancaster last week said these were progressing. "An announcement of their outcome is expected to be made shortly," he said.

2. China's crackdown - China has told its banks to raise interest rates on third mortgages and cut loan-to-value ratios in its latest attempt to take the steam out of an overheated property market, Bloomberg reported. Global markets are watching this attempt to apply the brakes closely and it may well spill over indirectly into New Zealand's property market as hot money leaking out of China into the Auckland property market dries up.

The regulator also told banks to stop granting new loans to developers found to be hoarding land or intentionally delaying property sales, and to take measures to make sure existing advances are repaid, the person said. Banks were told they should reject loan applications from people buying homes for "investment and speculation" purposes, the person said. Lenders were asked to raise down payments and interest rates for third mortgages by a "broad margin" if they're unsure of a borrower's intentions, the person said.

3. Australian bubble - Widely watched blogger Mike 'Mish' Shedlock is now focused on what he sees as a housing bubble in Australia. He suggests yesterday's decision by the Reserve Bank of Australia to leave its OCR on hold at 3.75% was a sign of panic from the central bank about not wanting to burst the bubble.

Fear in the board of governors over the pending crash is palpable. Prime Minister Kevin Rudd did not learn a single thing from the US and the disastrous policies of Greenspan. He gave one last goose to the housing market with $14,000 tax credits in a foolish attempt to stem the tide of the global recession that started two years ago. Prime Minister Rudd brags about Australia's ability to duck the recession. It did not work. All Rudd did was delay the inevitable, fueling an even bigger housing bubble. The bigger the bubble, the bigger the crash, and rest assured Australia is headed for a housing crash.

I certainly got that sense of a bubble mentality in Melbourne when I visited over Christmas. My brother showed me a small, empty section in a middle to lower income suburb half an hour's drive from the CBD that sold at auction in early December for A$890,000 after being advertised for around A$700,000. Just plain nuts. 4. Cooking the books - The US budget understates the government's liabilities by the US$6.3 billion trillion that is owed by Fannie Mae and Freddie Mac, but curiously includes dividends from these two broken mortgage guarantors in its income, Bloomberg points out. These debts would easily pump US public debt to GDP towards the 100% mark generally seen as fatal without significant tax hikes and spending cuts.

White House budget director Peter Orszag delayed a decision on whether to bring the companies' $1.6 trillion in corporate debt and $4.7 trillion mortgage obligations onto the federal budget. As the director of the Congressional Budget Office, Orszag criticized the Bush administration for keeping the 2008 rescue of the government-sponsored enterprises off budget. At the time, Orszag said "the degree of federal control over Fannie and Freddie is so strong, we are incorporating them into the federal budget."

Zerohedge tells it like it is here.

As readers can see, we are not talking about just any paltry amount: the most recent US total debt balance was $12.222 trillion. It would seem a little presumptuous that an amount representing more than half of the total US sovereign debt is conveniently swept under the rug. And with the omission from the Federal Budget, America's population once again has absolutely no visibility into the real fiscal costs associated with the government's support for the Debtor Nation Sponsored Entities (aka DeNSEs). Not only that, but at some we really should have a discussion over just what the delicate transition from the existing "conserved" [sic] status to a full nationalization and permanent US debt onboarding. What we definitely know is that we now live in a system where delusion is the norm: we have an administration that willfully and consistently deludes its population from representing just how bad our economic debacle really is, and we have a population, that willfully and consistently is happy to accept lies and delusions from every media and administrative outlet, and in turn deludes the administration that it will pays it taxes, or not walk away from yet another underwater mortgage. Rinse. Repeat. What we are positive, is that this arrangement of mutual delusion will persist will spectacular success. Until it doesn't.

5. The big picture - Rolfe Winkler at Reuters puts the US budget and the debt situation into perspective in this great column with two equally excellent charts here.

Winkler argues rightly that the deficit spending now may look better than during World War II, but that spending during the 1940s happened when US total debt/GDP was low after the massive de-leveraging of the depression and private debt was low. Obama is relying on GDP growth to get him out of trouble. The problem is the private sector is not consuming. Where will the growth come from? Apart from government? A brutally circular argument that will only end in a compounding debt spiral and default by the US government.

GDP "” a measure of spending "” can't grow unless we're spending more. Seems to me the only way for aggregate spending to grow faster than government spending is for the private sector to spend more. But households are tapped out. They're saving more to repair already busted balance sheets. At 10%, the deficit is far smaller as a share of GDP than during WWII. We've spent far more before, the argument goes, so it's no trouble to spend so much today. One problem with this argument is that it ignores unfunded liabilities for Medicare and Social Security . If the budget was calculated according to the same accounting principles that apply to corporations, the deficit would look much worse. We had no such unfunded liabilities in the '40s. The argument is also incomplete. Americans' total debt burden amounts to much more than what the federal government owes. Including private debt makes the picture look far worse than the '40s: It was easier to service higher public debt in the '40s because de-leveraging during the Depression had wiped out most private debts. Debt is the problem. We (should have) learned that after the Depression, yet we're piling on more in a misguided effort to prop up an economy that desperately needs to de-lever.

6. Wall of junk - The New York Times reports that Moody's is reporting that more than US$700 billion worth of high yielding corporate debt is due between 2012 and 2014. The day of reckoning was just postponed, not avoided.

The story of the explosion in cheap lending during the credit boom is well known at this point, and that bubble's popping has already led to big bankruptcy filings and bracing debt reorganizations. Of the top ten issuers with debt maturities coming due between 2010 and 2014, several are tied to boom-era buyouts, including a subsidiary of the utility player TXU (now known as Energy Future Holdings); the hospital operator HCA; the data services provider First Data; and the chip maker Frescale Semiconductor. But 2009 also saw a wave of high-yield debt offerings as well, some $145 billion in new junk bond issuances. Over all, speculative-grade companies raised about $200 billion in new debt for the year. What's especially notable is that about 78 percent of that debt was for refinancing existing obligations, Moody's points out. While those loans and, increasingly, bonds has postponed the day of reckoning for companies, it does nothing to relieve their overall debt loads. "Despite significant spread-tightening in the credit markets, there remain only limited options for rolling over this debt," Peter Fitzsimmons, the North America president for the consulting firm AlixPartners, said in a press release last week. "Therefore, the potential for a very serious cash crunch could be knocking on the door of Corporate America."

7.Move your money - The revolt against the 'Too Big To Fail' banks in the United States is gathering pace. Former IMF economist Simon Johnson calls here at baseline scenario for US taxpayers to move their money to credit unions and community banks.

After 30 years of deregulation and financial "innovation", our problem today is rather different.  The idea of banks being so big they can extract enormous resources from the state would have been incomprehensible to Jackson and ludicrous even to FDR "“ in their day the federal government did not have anywhere near enough resources to "save" massive failing banks as we have done in the past few years. The essence of our current difficulties is that so many people "“ both in power and from all walks of life "“ still actually think our biggest banks are good for their customers and for society as a whole, so we must hold our noses and live with them.  This view must be challenged, directly and repeatedly. In this context, moving your own money is more than an important gesture, and if enough people get on board, it will make a difference.  More likely, thinking hard "“and talking with others "“ about your various monetary transactions also beings to change the rules of the political game.  How can politicians claim to be against Too Big To Fail banks when they actually have an account or a credit card or a mortgage at one such offender?  Shouldn't state officials be held accountable for where they park the taxpayers' funds?  Which governor wants to risk reelection while heavily dependent on big banks?  Who got what kind of commission last time a government body issued bonds?

8. Quit the euro - Arch euro sceptic Ambrose Evans Pritchard asks whether Germany should pull out of the euro (Nein!) in this piece in The Daily Telegraph. You've got to give the guy credit for persistence. It will never happen if the German and French elites have anything to do with it.

Germany faces a terrible dilemma. Either Europe's paymaster agrees to underwrite a Greek bail-out and drops its vehement opposition to a de facto EU economic government, treasury, and debt union, or the euro will start to unravel, and with it Germany's strategic investment in the post-war order. The spike in yields on 10-year Greek bonds to 400 basis points above German Bunds has been shockingly swift "“ a warning to Britain, too, that markets can suddenly strike any country that takes creditors for granted. We can argue over whether Greece, Portugal, or Spain are at risk of being forced out of the euro. But there is another nagging question: whether events will cause Germany and its satellites to withdraw, bequeathing the legal carcass of EMU to the Club Med bloc. This is the only break-up scenario that makes much sense. A German exit would allow Club Med to uphold contracts in euros and devalue with least havoc to internal debt markets. The German bloc would enjoy a windfall gain. The D-Mark II would be stronger. Borrowing costs would fall. The North-South gap in competitiveness could be bridged with less disruption for both sides.

9. The power of factory dairy farms - Here's how the lobbyists for factory dairy farms in the United States have perverted the rules for organic dairy farmers so they can claim 'access to pasture' includes a strip of dirt outside the mega-shed. More evidence to say our diplomats shouldn't trust American trade negotiators to do anything other than feather the nests of the Agri-corporates. The story is in the politicsoftheplate blog.

Beginning in the mid-2000s, at about the time when it became evident that the green "USDA Organic" label translated into bigger profits, huge Confined Animal Feeding Operations (CAFOs) with herds of up to 10,000 cows located in western states got into the organic milk business. There was one obvious problem. How do you provide pasture for thousands of hungry cows in a semi-arid landscape that would, at best, produce enough feed for a few dozen animals? The answer, according to Mark Kastel, co-founder of the Cornucopia Institute, an advocacy group for organic family farms based in Wisconsin, is that the corporations that owned the CAFO's did everything they could to muddy the definition of "access to pasture." In some cases, a narrow, grassless strip outside the vast barns in which the animals were kept was considered "pasture" because some hay had been spread there. National Organic Standard Board (NOSB) allowances for cows and their very young calves to be kept indoors for a short period after birth were twisted to include all milking cows being kept inside 24/7 for 310 days a year.

10. Totally irrelevant video (but great for laugh) - A Macquarie bank trader got caught ...er...red handed watching a near naked woman on his screen during a live television cross on Channel 7. Now it's on Youtube for our viewing pleasure. Woops. Here's the article about it in the Daily Mail>, which my wife pointed me to...