Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including news the Dow has closed down 74 points and under 10,000 as worries about Europe's financial system and sovereign debt outlook continue to mount.
Investors remain concerned about America's economy too ahead of a speech this weekend by US Federal Reserve Chairman Ben Bernanke to a gathering of central bankers at Jackson Hole in Wyoming.
European fear deepened after a Spanish court ruled overnight that the government's tax collection techniques were illegal, sparking fear that Spain's fiscal position would worsen.
Spain has sinced denied the court decision reported by El Economista would cost billions of euros and now says it will just delay the collection of just a few hundred million euros.
Meanwhile in New Zealand, Bank of New Zealand's Chief Economist Stephen Toplis and JP Morgan Economist Helen Kevans have both changed their forecasts for when the Reserve Bank will next raise the Official Cash Rate.
BNZ's Toplis now sees the Reserve Bank holding the OCR at 3% until the December 9 meeting, leaving it on hold on September 16 and October 28. He had previously seen a hike in September and one more at either the October or December meetings. \
JP Morgan's Kevans was previously forecasting a hike in September, a pause in October and then another hike in December. She now sees a pause until December.
Meanwhile, on a lighter note, the Bank of Botswana has held its OCR at 10% and reported that GDP grew 36.4% in the first quarter. That is not a typo. Botswana is the world's largest diamond miner and has seen a recovery in demand and output.
And in China, the world's longest traffic jam is just starting to move after drivers were stuck in their trucks and cars for 10 days in a jam that extended 100 kilometres. There was a problem with road works.
The New Zealand dollar was solid around 70.3 USc.
No chart with that title exists.
22 Comments
The ongoing Chinese traffic nightmare has reduced commuting speeds to bicycle equivilents. That's progress I guess!
Whats next? Walking Pace?
Charles Hugh Smith
"Ironically, auto and truck traffic in Beijing has now slowed to the same pace of 20 years ago when 95% of the residents rode simple one-speed bicycles-- only now 30+% of the passengers are obese."
This "tea leaf reading" stuff.
Bernard,it seems that every economic "expert" has been provably wrong many times over our lifetimes.Should we return to the times that money was a means of exchange,rather than the commodity that it is now?
Could we?
Seems that while money is an industry,we are continuing to undermine the reality of living as human beings.
We bloggers are either laughing at others misery(mostly people who are wage earners who do mundane work so they can"live"),or telling others,and ourselves, that we have got it under control,when really we have no control and neither does our country.
We have a government run by a man who is proud of his cleverness at building a fortune buying and selling countries currencies(wealth),and a leader of a coalitian partner who lectured on economics,telling the "workers"that they need to live within their means ,while demonstrably not doing the same as a goverment.
It seems that whatever generation John Key belongs to, is running the world,one step away from the real movers and shakers who are above goverment,and are untouchable because they`re "running" our govements from their money houses.
Are fellow bloggers truly feeling any control on their lives in this present time?
Look to your friends,family,community,garden,countryside,and work out whats truly important"the money,or a life"?
Needed to get that off my chest.
and it would appear from this morning's Herald that the ACT party is actually the dominant partner....dictating the new 90-day employment law, as well as the super city legislation. how on earth dod we get hijacked by a party with 3% of the vote?
key,english and joyce are obviously even more scared of hide that heather roy was. good grief.
ACT are so full of contradictions its not funny. remember when some northland maori were talking about a charge for crossing their land and david garrett got all up in arms about it and went crying to the attorney general? so its ok for him as a lawyer to charge for his services or stop people trampling his garden but not ok for someone else? and hide the perkbuster?
i'm starting to think that john keys' use of act will actually be their downfall.....maybe a one-term govt after all......
My turn again....for all who cannot pick the winner....deflation or inflation....we have an answer....the zombie is in trouble!..... http://www.marketoracle.co.uk/Article22199.html
"The paper currency is losing value at a much faster pace than the official inflation statistics, people are waking upto this and will increasingly demand payment in terms of ability to track the price of goods and services not official indices therefore demand wage rises above official inflation indices and thus triggering the dreaded wage price spiral, "
Here in Noddyland we know how much we can trust the "official numbers" and we have the added bonus of a gst inflation spike to allow for........any wonder then that Bolly has decided to 'jawbone' down the wage demands....and he will have as much success in that as he had using the ocr to stop the flow of hot munny in Noddy.
Yes and no...or is that no and yes..errr...armmmm...it's hard to see past the Fed and BIS manipulating the gold price GBH...the thing about the inflation...that is coming...it will kick the you know what out of the already buggered western economies by destroying property values in the likes of here and aus as well as spain Ireland and the usa and elsewhere....which is why the liars are BSing the public about there being none.
Such a good kicking can only drive down western demand for copper. Eastern demand will still go up but overall you may get a flat market. Then the Mongolian monster begins to arrive...the copper deposit to beat all. That sod will produce enough to meet demand and then some. That is why long term copper prices are under $2us.
Gold on the other hand will be fiddled with by the Fed and the BIS to stop any breakout for some time to come. It is still worth picking up company shares if a div is paid franking free in aus cos you don't want to be double taxed...do you! That way you have a spot at the table with some cards worth holding when the bomb goes off.
As for Afghan mineral deposits...cheaper to mine the Moon...safer too!
For what it's worth , my take on it is that the Federal Reverse have alot of skin-in-the-game to ensure that QE kick-starts inflation . That inflation will ease the massive burden of their QE programme to date . ................ Expect inflation stimulatory policies to continue .
The USA is not entirely pulling out of Iraq, they are merely ceasing combat operations, then slowly reducing into an advisory role, where they remain armed, and ready to go at the Iraqi govt request. Some will always remain, to protect vital interests, I mean help the Iraqi's.
Put that Playboy down. Silicon under your nose indeed. How silicon you get?
Steven has the big picture. The problem now is that all our infrastructure is geared to oil, and we're out of time to convert to we-know-not-what. En-bigger-than-ever-before-masse.
And due to the levelling-off of real energy flows, we wobble across the plateau trying to kick-start our dead motorbike, rather than preparing for the downside.
At that point, appropriately, all bets are off.
Still reckon Mad Max plumbed with copper, though, Wally. Still reckon it's the one to own - one day you'll be pleased you held on to that old ballcock.
90 seconds at 8am Monday!...what's Bolly reading this morning?...probably this:
http://www.marketoracle.co.uk/Article22266.html
"... growth during the past year has been too slow and joblessness remains too high..."
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