Here's my summary of the key news overnight in 90 seconds at 9 am, including news of some big global events brewing.
Americans may winding down to an extended holiday weekend, but there are crises brewing worldwide, despite some good local jobs news. The American summer 'driving season' has started.
Firstly in Egypt. The latest news is that the army has been deployed, Morsi is gone, and the country is to have an interim technocrat government. This affects the rest of the world economically via the Suez Canal and the oil price. Oil has risen sharply and is up over 2%.
US benchmark prices are over US$100/barrel and Brent is over US$105/barrel. Low American inventories are accentuating the rises, although there are market suggestions that the military takeover in Egypt may not hurt prices further. At our pumps, petrol is now at its highest level ever, rising seven cents this week, although half of that was a local tax increase. But higher pump prices are expected.
In Portugal, borrowing costs have risen sharply and stocks have fallen amid growing concern over the political crisis in the country. The finance minister resigned recently, followed by the foreign minister and others are expected to follow. There are elections due and the departing politicians were key to the country meeting its bailout obligations.
There are now serious doubts about Portugal's ability to deliver the fiscal reforms necessary under the terms of its troika bailout. Portugal can't survive higher debt costs.
In Australia, their currency is falling fast this morning. Aussies will be waking to their currency at its lowest level against the US dollar in almost three years.
Against the Kiwi, we are now over 86 AUc and that is our highest against the Aussie since November 2008. Active RBA statements by Glenn Steven is raising expectations of more rate cuts, and a push to lower the currency value.
And finally in China, investors are bailing out of China's markets as fears grow over their slowing economy and as Beijing discourages ideas that it might try to juice it back up. The amounts of money involved in these outflows has grown to be a significant drag.
The NZ dollar starts today at 77.7 USc, 86.0 AUc, and the TWI is at 74.0.
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9 Comments
Nothing very new, this are at least messages one is conscously aware of compared to subliminals (below conscousness level) inaudible, which are embedded in music and other surface noise, mainly in shopping malls ore stores with background music. Very efficient and proven to work. Supposedly been banned now, but was (or is still) general practice for years.
Went to an interesting lecture this week. Two international lawyers, dealing with water. One of the case studies was the Nile. Their take was that Egypt is a manifestation of water poverty; population vs increasingly-contested supply. Being specialists, they missed energy completely - says a lot about the failure of our specialised society.
They mentioned 'virtual water', though - an important thing to keep a global eye on. Even your cell-phone needed Chinese water in it's construction, so you bought part of a Chinese river. Applies hugely to food. Same thing with virtual energy; you buy a flat screen which started ourt in an Australian coal-mine.
Water will be owned, and the poor will die. Even now, some US states allow other parties to own the water which lands on your roof. Energy? Slightly harder to police, but I bet they'll try.
Water, yep there are comments Ive seen that the big food conglomerates want to and expect to own water, its a commodity that will get scarce and hence can be monopolised...and over-charged for.
As per the lawyers though when push comes to shove any Govn that doesnt nationalise these sorts of things back into soverign ownership will be toast, either in the election booth or at the muzzle of a gun....thats what I think they dont understand "let them eat cake" wont work. Egypt is one that it seems will go the ak47 way, pity they didnt control population earlier, now nature and/or lead look set to do it for them.
NB In the UK water authorities "own the water" and charge you if the runoff is piped even into your own soak-away. When my parents did their house there had to be a gap between the drain in the ground and the runoff pipe from the roof or the water authority charged more...
Have you looked at the solar panel industry in Germany? they lease roofs for decades and plant panels on them.
Really its our own fault, we wont pay the taxes for the services we want so pollies find other ways to finance the wants....we need to get real.....
regards
Strange how you ignored the huge miss by the US non manufactuting (service) sector PMI (estimated to expand to 54.3, but crumpled to 52.2). A three year low.
http://www.cnbc.com/id/100861028
Given that it represents 80% of the US economy some might say it is an indicator to be watched closely.
Re; oil. Isn't it amazing with all that 'extra' oil the US is producing that the WTI price continues upwards? That wasn't supposed to happen in cornucopia land now was it?
"Against the Kiwi, we are now over 86 AUc and that is our highest against the Aussie since November 2008. Active RBA statements by Glenn Steven is raising expectations of more rate cuts, and a push to lower the currency value."
Not good news for RBNZ, a higher dollar will tie their hands even harder, we might not see interest rate rises next year...
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