Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including news that European and US stocks fell sharply overnight on growing fears the European financial crisis is threatening again to stumble out of control again.
European stocks fell more than 2% and US stocks were down more than 1% in late trade.
Rumours that France's AAA credit rating may be cut helped undermine investor confidence, although a denial help boost US stocks in the last two hours of trade. See more here at Bloomberg.
Measures of stress inside the European banking system are growing to Lehman Crisis levels as banks worried about other banks' exposure to sovereign debt hold back from lending to each other.
This is forcing many to go to the European Central Bank to borrow money as a lender of last resort. Germany remains implacably opposed to the European Central Bank massively printing money to buy sovereign bonds, widely seen as the only measure likely to stabilise the situation.
There have been reports in recent days that Germany's second largest bank, Commerzbank, is in talks about a bailout by the German government. France's largest banks are also under significant stress.
Credit Agricole, which sold NZ$250 million worth of deeply subordinated bonds to New Zealand investors in 2007, is expected to report a loss this year and announce plans to cut 2,350 jobs to strengthen its balance sheet. See more here at Bloomberg.
Meanwhile, Italy sold €3 billion of 5 year bonds at almost 6.5% overnight, which is widely seen as unsustainable for Italy as it prepares to refinance €53 billion in the first quarter of 2012. See more here at Bloomberg.
Assets seen as riskier were sold off around the world, particularly those that had previously been bought with borrowed money.
The gold price slumped to under US$1600/oz.
The New Zealand dollar was also weak in early morning trade at 75 USc.
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12 Comments
Berno, you are rocking the Perry look today, looking good.
Silver is down 10% for the month to date. NZD is down a mere 5%, buy 20z get one free.
Also noticed physical silver is more expensive on trademe, then at NZmint. Potential there for owners of physical silver to simultaniously sell on trademe, and buy from NZmint.
Skudiv.....people buying silver ingots whatever are fools...this is what they ought to swap their used toilet paper currency for... http://www.maineantiquedigest.com/stories/?id=1322
Good luck to you skudiv....if I were to go the silver way it would be the route I suggested..beware of 'rare' silver coins skudiv and gold ones for that matter...the fakes are flooding the markets....nothing like discovering a hoard of coins under the 'fool glare' of the media having made them yourself and buried them just so....no end of 'experts' around to say they are dinkum.
Yeh I'm not keen on buying off trademe, get the offical stuff comes with a bit of paper saying it's 9999 fine. If I ever had to sell, there is a liquid market there for the stuff.
A bit of old wisdom is to have 5% of your investments in Precious Metals. So for every $20k of investments, you could easily buy 20oz of silver, which are currently only $900 + P&P. The old ratio of silver to gold puts silver at USD$100oz, so for me this is a great way to diversify.
It is hard to obtain good data in China, but something is wrong when the country's Homelink property website can report that new home prices in Beijing fell 35pc in November from the month before. If this is remotely true, the calibrated soft-landing intended by Chinese authorities has gone badly wrong and risks spinning out of control.
http://www.telegraph.co.uk/finance/china-business/8957289/Chinas-epic-h…
all you housing freaks need to read the above article, China housing is in a deflationary spiral wealth is being destroyed, its not going to stop in China its goping to spread, hard had time guys.
Oh, and a clip on MF
"It was about bricks and mortar and property prices," Herald on the EQC farcical policies
What we have here, should be burned into the timber panelling in the PM's office on the 9th floor of the Beehive and into the panelling inside the debating chamber in Parliament.
That way, the morons pretending to govern this country, will never have a problem answering the question......"WHY ARE WE HERE"
The Coalition says Labour’s welfare legacy means there are many parts of Britain where three generations of families have never worked and live a life funded by state benefits.
Hah...you thought this news item was about New Zealand didn't you!.......oh....you're right....we have the same problem.
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