Bernard Hickey details the key news overnight in 90 seconds at 9 am in association with Bank of New Zealand, including news much of the lower half of the North Island and the South Island is dusted in snow this morning and the Antarctic blast may drag on for a few days, weather forecasters say.
Stuff reported up to 1,700 dairy farms may be forced to dump their milk today because Fonterra's milk tankers may not be able to get through snow-blocked roads.
However, Federated Farmers has said the storm is unlikely to cause major stock losses because lambing has yet to start in the lower parts of the South Island and because farmers had plenty of warning to move vulnerable stock into sheltered areas. See our article yesterday with details from readers in rural areas.
Meanwhile, the return of merger and acquisition activity has given stock markets a boost overnight.
Google announced it would spend US$12.5 billion of its cash pile to buy Motorola Mobility (it's mobile phone business). See more here at Bloomberg.
Also, Time Warner is spending US$3 billion to buy Insight and TD Bank is buying Bank of America's cards business for US$8.6 billion.
All this activity boosted hopes that cashed up corporates will start deploying their cashpiles to buy and invest, boost share values and economic activity.
The Dow rose 1.9% and the S&P 500 rose 2.1%. See more here at Bloomberg.
European markets were also more stable overnight on hopes a meeting of German and French leaders may agree on a solution to common Euro bond issuance, which some believe may solve Europe's sovereign debt crisis. See a preview of the meeting from Reuters.
Also, the Swiss franc fell on fresh talk its central bank may set a target or peg for the currency. The Yen also fell on talk of Bank of Japan intervention to stop the Japanese currency from rising further against the US dollar.
Both the franc and yen are seen as safe havens amid financial market turmoil and expectations of further money printing in both Europe and the United States. See more here at Bloomberg.
Meanwhile, some better news from Japan. GDP contracted by 1.3% on annnualised basis in the June quarter, which was half what economists expected. See more here at BBC.
The New Zealand dollar was broadly unchanged around 83.2 USc in morning trade.
No chart with that title exists.
21 Comments
"German Chancellor Angela Merkel's coalition partners are threatening a withdrawal from government if she agrees to eurobonds or any form of fiscal union to prop up southern Europe."
This should be fun!
Forget the rises on the Dow etc !...Never catch a " falling knife " time, kids !
We have a clear bear market signal across a wide range of indexes and current behavior is typical of the early “Denial” stage. If we look at 2008, the Dow broke primary support at 12800 in January, falling sharply before encountering strong buying support at 12000, signaled by weekly volume over 1.5 billion [1]. The rally failed, but buyers again snapped up bargains, with weekly volumes [2] above 1.5 billion. A third rally even penetrated resistance, but buyers soon lost interest and the next down-swing [3] led to a strong bear market over the next year.
Keep ya powder dry..
Listening to the world economic and financial news, leaders and experts this morning and then make my own judgments where we should be going - this is the only way:
http://www.youtube.com/watch?v=EQqDS9wGsxQ
Yeah - milk- tankers stuck in snow - a litre of milk could be a $ 1.-
"Karl Marx had it right," Roubini said in an interview with wsj.com."At some point capitalism can self-destroy itself. That's because you can not keep on shifting income from labor to capital without not having an excess capacity and a lack of aggregate demand.
http://www.ibtimes.com/articles/197468/20110813/roubini-nouriel-roubini…Worth the time to watch Andrew, thanks. I guess this is why someone emailed this quote to Bernard last week:
“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning."
My suggestion to Bernard was to do an article explaining why Henry Ford said that. (No doubt Iain and Raf could lend a hand, Bernard.)
Cheers, Les.
Les - Baron de Rothschild beat him to it, here he is from 1867:
A few who can understand the system will either be so interested in its profits, or so dependent on its favours, that there will be no opposition from that class. On the other hand the great body of the people mentally incapable of comprehending (the system), will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests”.
Then read Greg Pytel on the Credits rating agencies
'' Hong Kong's export-led economy, a barometer of global growth, is sinking into a recession that is likely to last for at least a year, said Daiwa Capital Markets economist Kevin Lai''.
http://www.bloomberg.com/news/2011-08-15/hong-kong-to-enter-recession-f…
De ducks are all lining up, quack, quack........
Roubini on where his money is,
cash...
http://online.wsj.com/video/roubini-warns-of-global-recession-risk/C036…
17mins in....but its all worth listening to...
regards
The Automatic earth has its yearly review and support deflation,
Deflation:
When bubbles reach their maximum extent, they invariably deflate. Our explanation as to why this is inevitable can be found in Inflation Deflated, followed by, The Unbearable Mightiness of Deflation, a rebuttal to inflationist Gary North, and Debunking Gonzalo Lira and Hyperinflation.
theautomaticearth.blogspot.com
1) Hold no debt (for most people this means renting)
2) Hold cash and cash equivalents (short term treasuries) under your own control
3) Don't trust the banking system, deposit insurance or no deposit insurance
4) Sell equities, real estate, most bonds, commodities, collectibles (or short if you can afford to gamble)
5) Gain some control over the necessities of your own existence if you can afford it
6) Be prepared to work with others as that will give you far greater scope for resilience and security
7) If you have done all that and still have spare resources, consider precious metals as an insurance policy
8) Be worth more to your employer than he is paying you
9) Look after your health!
Thx, Andrew. Good refresher reading on a chilly winter's day.
Fonterra says the majority of South Island sites are now collecting milk - Edendale, Clandeboye, Takaka and Kaikoura. Three remain closed. Says: "We'll continue to monitor the weather and road conditions closely. The safety of our tanker drivers remains the priority."
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