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90 seconds at 9 am with BNZ: Krugman eyes US$10 trln QE II; Fed may buy corporate bonds; A$ hit 99.9 USc; Singapore tightens; India may intervene

90 seconds at 9 am with BNZ: Krugman eyes US$10 trln QE II; Fed may buy corporate bonds; A$ hit 99.9 USc; Singapore tightens; India may intervene
15th Oct 10, 9:02am by Bernard Hickey

Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including more news in the currency wars being stoked by talk of a second round of Quantitative Easing or money printing by the US Federal Reserve to try to pump up a depressed US economy.

Closely watched economist Paul Krugman has suggested the Federal Reserve may need to print between US$8  trillion to US$10 trillion to get the economy, which is equivalent to 50-70% of US GDP and equivalent to 200% of Chinese GDP.

Also, Federal Reserve Boston President Eric Rosengren has suggested the Federal Reserve could buy corporate bonds to try to restart the economy.

Elsewhere in the Currency Wars, Singapore announced it was letting its currency appreciate vs the US dollar to control inflation, while India said it was considering intervening to keep its currency down vs the US dollar.

Meanwhile across the Tasman, the Australian dollar almost hit parity overnight, rising to 99.93 USc before receding from its highs to be around 98.9 USc this morning. The New Zealand dollar also edged up towards 26 month highs around 76.5 USc before easing back.

Meanwhile the American economy continues to struggle. America's trade deficit rose to US$46.3 billion and jobless claims surprisingly rose 13,000 to 462,000.

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13 Comments

by  David George  |  15th Oct 10, 9:21am 1287087706

That Krugman! Nobel prize in economics?  Why stop at  ten trillion, surely a hundred trillion would be better, why not try a gazillion?

This is the sort of crap that convinces you that teotwawki is upon us.

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by  Vanderlei Luxemburgo  |  15th Oct 10, 10:52am 1287093168

good call KD. 

the further into this we get the more obvious it is that the finance industry is loaded with people who have no idea what the hell they are talking about. furthermore, i don't see how this system can recover without the finance industry being almost completely wiped out...... a big stinking messy reset. 

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by  martinv  |  15th Oct 10, 11:39am 1287095947

The future, at an elementary school somewhere in the US:

"Now if Samantha has 100 trillion Dollars, and she buys two apples for 1.5 trillion Dollars each and a kilo of brocolli for 25 trillion Dollars, how much does she have left?"

 

Actually, this is highly unlikely to happen - in the future the government will not be able to afford to run schools.

 

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by  Gareth Vaughan  |  15th Oct 10, 11:05am 1287093941

Good news for Fletcher Building here.

Fletcher Construction to manage Earthquake Commission’s (“EQC”) Canterbury earthquake project management office



Auckland, 15 October 2010 - Fletcher Building Limited confirmed today that its subsidiary, The Fletcher Construction Company Limited (“Fletcher Construction”), has been selected to manage EQC’s Canterbury earthquake project management office following the recent Canterbury earthquake.

The appointment was made following a tender process.



Fletcher Construction will act as the EQC’s agent in delivering the rebuilding programme.

The Fletcher Construction team will meet the EQC’s team in Christchurch today for an initial briefing. Work on establishing systems and setting priorities will commence on Monday 18 October.

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by  FCM  |  15th Oct 10, 11:53am 1287096816

I hope Fletcher Construction have some really good customer service people on the ground, as there are a lot of angry people down here waiting on some form of communciation from someone as EQC are lost for answers in regards to timelines etc for rebuilds.

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by  kin  |  15th Oct 10, 11:32am 1287095532

I heard Krugman on CNBC yesterday..something like this (not exact words as I did not record it :

CNBC: US is devalueing it's currency via QE, what's the difference with China's currency control in holding it's currency value ??

Krugman: A devalueation by easy money and credit creation is different from a manipulation of a country's currency by sustain invervention by that country.

 

Rough translation: It is not important if the person dies...but it's important how you kill him as that will find you whether guilty or not guilty...

No wonder the Noble price no longer has any value....

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by  JP  |  15th Oct 10, 12:03pm 1287097398

American's are doing a controlled demolition of their currency. This is to let all the creditors know who is boss. Only thing that going to happen is its going to hurt all parties.

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by  David George  |  15th Oct 10, 12:52pm 1287100379

Could anything be sweeter for the big banks? No.

The incestuous nature of the system is breathtaking. The Fed creates the credit which enables the mortgages, the Treasury guarantees the mortgages via Fannie, Freddie and FHA, the Fed buys the mortgages ($1.3 trillion in mortgages are on their balance sheet) and the private banks collect the fees and profits.

There are many examples of this partnership (crony capitalism in which the State is the "enforcer" which collects the national income and distributes it to its private-sector cronies), but perhaps none so blatant and pure as the mortgage/banking sector.

But now the entire legal basis for that privatized-profits, socialized losses system has dissolved. The foreclosure scandal is not just a "scandal" in which various frauds were brought to light; it is the failure of the entire system of originating mortgages that props up the entire real estate market.

http://www.oftwominds.com/blogoct10/foreclosure-collapse10-10.html

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by  puketepapa  |  15th Oct 10, 1:38pm 1287103103

federal reserve - is not a government authority

Who are the owners or chief shareholders of the privately owned Federal Reserve?. Originally there were reportedly 203,053 shares of privately owned Federal Reserve stock of which approximately 65% were owned by foreigners, and 35% (72,000 shares) were owned by the following:

1. Rockefellers' National City Bank * 30,000 shares

2. Chase National * 6,000 shares (currently Chase Manhattan and owned by David Rockefeller)

3. The National Bank of Commerce * 21,000 shares (now known as Morgan Guaranty Trust)

4. Morgans' First National Bank * 15,000 shares

The total shares owned by Rockefellers' interests equal 36,000 shares. The total of Morgans' equals 36,000 shares. Although the privately owned Federal Reserve Act of 1913 provided the names of the owner banks be kept a secret, R. E. McMaster, discovered through confidential Swiss banking connections the following banks have controlling interest in the privately owned Federal Reserve: R E McMaster see http://trusaorg.tripod.com/base/cc2p.html

1. Rothchild Banks of London and Berlin

2. Lazard Brothers Bank of Paris

3. Israel Moses Sieff Banks of Italy

4. Warburg Bank of Hamburg, Germany and Amsterdam (UBS)

5. Kuhn Loeb Bank of New York

6. Lehman Brothers Bank of New York

7. Goldman Sachs Bank of New York

8. Chase Manhattan Bank of New York (Controlled By Rockefellers)

wikipedia: Eustace Mullins, 1952  Secrets of Privately owned Federal Reserve see http://en.wikipedia.org/wiki/Eustace_Mullins

The shareholders on Mullins list are almost identical to the one compiled by the Swiss banking source.

1. Rothchilds

2. Lazard Freres (Eugene Mayer)

3. Israel Sieff

4. Kuhn Loeb Company

5. Warburg Company (UBS)

6. Lehman Brothers

7. Goldman Sachs

8. The Rockefeller family and J.P. Morgan interests

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by  Number 6  |  15th Oct 10, 2:09pm 1287104949

So do we get to supplant my namesake with Barclays Bank?

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by  Christov  |  15th Oct 10, 1:49pm 1287103743

Moderator....I had read this in a cracking book a while back ....thanks for taking the time to post this......always handy.

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by  Boatman  |  15th Oct 10, 3:39pm 1287110354

Hi Guys 

Are we going to get our top 10 stories for Friday?

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