Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including news that French bank stocks rebounded after they reassured investors they had plenty of capital and access to funds in the event of a Greek default.
Shares in Societe Generale rose 15% and BNP Paribas rose 7.2% overnight, helping to drag European stock markets up 2.1% and lifting the Dow 0.4% by the close. See more here at Bloomberg.
Investors had slammed the French banks earlier this week, fearing they would be hit hard by any Greek default and subsequent writedown of the values of Greek bonds and other assets they have on their books. See more here from Reuters on European shares.
However, deep concerns remain about the Greek debt situation and the potential for a Greek exit from the Euro that could trigger much more serious financial market and banking system disruption.
German Chancellor Angela Merkel and French President Nicolas Sarkozy Angela Merkel mucked around overnight, failing to agree on a joint statement before agreeing to a teleconference call tomorrow with Greek Prime Minister George Papandreaou.
Concerrns about the deteriorating European situation have everyone worried, including Barack Obama, who overnight called for European leadership on the issue. See more here at Reuters.
Even our own Finance Minister Bill English warned yesterday that a global growth slowdown and/or European Financial meltdown could slow our growth.
Also overnight, Italy struggled to sell government bonds in an auction. See more here at Reuters.
The CEO of FIAT also warned the financial system could 'go off the rails'. See more here at Reuters.
See my explainer from last week on how the European mess developed and what it means for New Zealanders.
Meanwhile these concerns about the global economy are expected to see the Reserve Bank of New Zealand, hold the Official Cash Rate at 2.5% when it releases its September quarter Monetary Policy Statement at 9 am tomorrow.
Most bank economists expect the first hike to now be in December. Other economists see rates on hold until well into next year.
The New Zealand dollar was steady around 82 USc overnight, but remains firm just under 80 Australian cents on hopes the Reserve Bank of Australia will hold rates, which makes the Australian dollar relatively less attractive than the New Zealand dollar, where rates are still expected to rise. See more here in BNZ's currencies report.
(Updated with currencies detail, charts below)
No chart with that title exists.
15 Comments
Slightly different take (how technology is also playing its role in killing the US economy)
http://www.upi.com/Top_News/Analysis/Walker/2011/09/12/Walkers-World-A-…
Interesting..can't say i agree re health workers. There wil be more required due to ageing popn. Technology may mean more treatment for more people, but won't eliminate the human care element which is very important in health.
Education though is a biggey. If your kid has a crap maths (or whatever) teacher (and many are), they are better of using these short vid clips http://www.khanacademy.org/
the benefit of these clips is the kid works at own pace, freezes the lesson, repeats the lesson and so on. Have used it for mine - highy recommend it. Its also free.
Much of the discussion at the moment in the press is about the ability of the European banks to withstand a Greek default, but for me the real story is what's happening in Italy. Check out this graph of CDS on Italian sovereign debt - that's an ugly trend.
http://www.bloomberg.com/apps/quote?ticker=CITLY1U5:IND
The race to the bottom, who is first Europe or America pulling down each other?
Obama’s job growth
Bank of America will cut 30,000 jobs as part of the biggest cost-saving plan undertaken by any bank since the height of the financial crisis
Wall Street banks will see profits tumble in the third quarter as the weak global economy dents their once buoyant trading operations, Citigroup has warned.
Another “Black Friday” 28th of October 2011 - or even the ones before ?
A couple of claification points: The success of Amazon, yes, but it was also a failure on the part of Borders management in the policies they undertook.
The US postal service in the past 4 years has expediture of 20 billion dollars greater than their income. Should they change their management policies, yes, but their hands are tied by Congress who make the rules. As to the layoffs, the Unions have no-layoff clauses in their agreements.
The World is changing but those running the show seem wedded to the old way of doing things.
"Labour's acting state services spokesman, Grant Robertson, said the job cuts came on the back of thousands of jobs being axed across the public sector in organisations as diverse as Defence, Inland Revenue, and KiwiRail.
"They are a direct result of this Government's carve-up of the public sector, and simply add to the increasing number of unemployed Kiwis,'' Mr Robertson said. In the past year alone more than 1500 state sector jobs have been axed." herald
Wonderful isn't it Grant...and the money not dished out in salaries and wages will not need to be taxed off the income earners who will have a bit more to spend and the spending will create real jobs and the very same state sector employees will find many new jobs to pick from...
All part of Grant's educational experience...let's hope he applies himself in a diligent manner...hell he might even start to glow blue.....!
Aussie RE agents dump listings because the high prices asked for means its a waste of their time:
http://www.heraldsun.com.au/news/more-news/agents-dump-sellers-over-dre…
French Banks stare into the abscess
http://blogs.telegraph.co.uk/finance/jeremywarner/100011929/europes-ban…
Interesting that the highest rated comment should be this one mad GP Yesterday 04:29 PM Recommended by120 people Now just hold on one cotton-pickin' minute.
Last year, these banks paid their bankers record bonuses out of bank capital. Are you suggesting they now rob EU taxpayers to continue fradulently trading as solvent companies? The more equitable solution is for the banks to raid their staffs' bonus pots (that which hasn't been consumed on wee hookers and cocaine) to make up the shortfall.
If the scoundrels running these banks insist on raping EU taxpayers instead, I would suggest the most utilitarian outcome would result from EU taxpayers lynching these wealth creators instead. The greatest good for the greatest number (or in this case, the least worst misery for the greatest number).
I met a banker from ShittiBank recently who echoed your argument that bankers were obliged to buy Government bonds for liquidity requirements. Whilst this is true, they didn't need to buy Greek bonds, nor did they need to deplete their banks of capital when times were pseudogood back in the heady days of 2010.
The guillotine set to fall on these mens' necks is one of their own making. Karma can be a bitch.
Property boom times in Niamey....
"Niger says that Saadi Gaddafi, one of the sons of fugitive Libyan leader Col Muammar Gaddafi, has arrived in the capital, Niamey." bbc
but it's so hard to find property with gold vaults beneath...especially in Niamey...
Mud huts anyone!
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