End Of Days News
When visiting US Secretary of State John Kerry sat one-on-one with Egyptian
President Morsi in Cairo, Sunday, March 3, he talked at length about Egypt’s
calamitous economic straits, relations with Israel, democratization and
essential reforms. He had hoped to find the Egyptian president amenable to
getting to grips with his country’s fast approaching bankruptcy. In the event,
Morsi nodded politely but, debkafile’s Middle East sources report, he was far more preoccupied
with pushing forward the three-point plan he and the Muslim Brotherhood’s
supreme leader Mohammed Badie have begun implementing:
1. The Muslim Brotherhood will not settle for a parliamentary majority in the
coming general election – most likely in April or June; it is aiming for 100
percent of the seats.
2. To set the stage for this campaign, the Brothers
have installed their loyalists in the governates of Egypt’s 19 provinces. The
spreading of Brotherhood values in the national constituency is going full steam
ahead across Egypt.
The MB turned to this course when they saw they had no
hope of exercising total control over the restive capital and the protest
movements springing up regularly in Tahrir Square. So they decided to build up
their support in the country at large in the hope of making Cairo an isolated
Island in the predominantly Islamist country.
3. To boost their popularity in the coming election, Morsi and Badie decided
they could not afford the painful measures required by the International
Monetary Fund for a $4.8 billion loan to tide the economy over its current
crisis - spending cutbacks, downsizing the vast Egyptian civil service, reducing
food subsidies and cutting away dead wood.
Instead, they dropped their credit application to the IMF altogether and so
avoided mass unemployment and widespread hardship in the months leading up to
the election.
However, the US Secretary of State sternly called the Egyptian
president’s attention to three major concerns which need to be addressed with
the utmost urgency:
a) Egyptian foreign currency reserves continue to bleed
dangerously and no one knows how to stop the disastrous drain. By April, it is
predicted that no more than $4 billion will be left to sustain a population of
80-90 million souls.
2. Egypt’s industrial plants are working at just 50
percent capacity because fuel is scarce and the money to buy it even
scarcer.
3. Gas for powering electricity is running out. More and more areas
no longer receive regular electricity – some none at all. The water supply is
also affected.
debkafile’s
sources report two conflicting approaches on how to resolve Egypt’s calamitous
economic emergency:
Showing posts with label Economy. Show all posts
Showing posts with label Economy. Show all posts
Monday, March 4, 2013
Tuesday, February 12, 2013
Russia emerges as world's top gold buyer, adding 570 metric tons in last decade
End Of Days News
Over the last decade Russia’s Central Bank acquired 570 metric tonnes of gold. The amount is almost triple the weight of the American Statue of Liberty and makes Russia the world’s biggest buyer of gold.
The amount is a qurter more than runner-up China, Bloomberg reported on Monday.
Countries like Russia and China use such stockpiles as an economic buffer against another wave of economic crisis or US dollar devaluation, as both remain weary of the US Federal Reserve’s stability and prefer to edge their bets on gold.
It’s also proven a sound investment and opportunity for the Russian state to make money, with gold prices crawling upwards over the past 12 years, gaining 12% in 2012 alone. On Monday gold traded at $1650 per ounce and analysts expect the price to keep growing in 2013 to reach $1825 by the end of the year. However French investment bank Natixis dampened the outlook by forecasting a drop in price to $1500 by 2014, Finmarket.ru reports.
But the link between high gold prices and falling crude has plagued Russia in the past. In 1998, when Russia defaulted on $40 billion of domestic debt, it took 28 barrels of crude to buy an ounce of gold, according to Bloomberg research. Two years later, when Vladimir Putin came to power, an ounce was worth 11.5 barrels. By 2005 the ratio had dropped to 6.5 and that is when President Putin ordered his Central Bank to buy. In just a month the proportion of gold in Russia’s total reserve rose from 2.2% to 3.5%.
In 2000 Vladimir Putin inherited a country with 384 metric tons of gold and more than doubled its gold reserve in 12 years – according to official data from World Gold Council, in October 2012 gold made up 9.6% of Russia’s national forex reserve and stood at 936.7 metric tons.
However it is still far from its historic high – in 1941 Russia held a record 2800 tons of the precious metal and thanks to these reserves successfully recovered after World War II.
Russia’s gold rush still doesn’t mean it tops the list of global gold owners. The United States holds the leading position with 8133.5 tons of gold which make 75.4% of country’s total reserve. Germany runs second with 3391.3 tons and the IMF third with 2814 tons. China and Russia are sitting in sixth and eighth place respectively.
China however is suspected of downplaying its actual volume of gold by 3-4 times, Zerohedge news website reports, and prepares to introduce Yuan as world’s reserve currency. Back in 2009 China set a goal to overtake the US in the rankings. When the Chinese Central bank is ready to officially declare its actual gold reserve volume, world markets will experience serious problems, Zerohedge.com believes.
Major global investor and consulting adviser to the Obama administration, George Soros also appears to have a golden investment streak. In August 2012 it was reported, Mr. Soros offloaded over a million shares in financial companies and banks and purchased $130 million in gold. His move to sell stocks and beef up on gold, is being interpreted by some as a sign of changing investment strategy in the world market.
Countries like Russia and China use such stockpiles as an economic buffer against another wave of economic crisis or US dollar devaluation, as both remain weary of the US Federal Reserve’s stability and prefer to edge their bets on gold.
It’s also proven a sound investment and opportunity for the Russian state to make money, with gold prices crawling upwards over the past 12 years, gaining 12% in 2012 alone. On Monday gold traded at $1650 per ounce and analysts expect the price to keep growing in 2013 to reach $1825 by the end of the year. However French investment bank Natixis dampened the outlook by forecasting a drop in price to $1500 by 2014, Finmarket.ru reports.
But the link between high gold prices and falling crude has plagued Russia in the past. In 1998, when Russia defaulted on $40 billion of domestic debt, it took 28 barrels of crude to buy an ounce of gold, according to Bloomberg research. Two years later, when Vladimir Putin came to power, an ounce was worth 11.5 barrels. By 2005 the ratio had dropped to 6.5 and that is when President Putin ordered his Central Bank to buy. In just a month the proportion of gold in Russia’s total reserve rose from 2.2% to 3.5%.
In 2000 Vladimir Putin inherited a country with 384 metric tons of gold and more than doubled its gold reserve in 12 years – according to official data from World Gold Council, in October 2012 gold made up 9.6% of Russia’s national forex reserve and stood at 936.7 metric tons.
However it is still far from its historic high – in 1941 Russia held a record 2800 tons of the precious metal and thanks to these reserves successfully recovered after World War II.
Russia’s gold rush still doesn’t mean it tops the list of global gold owners. The United States holds the leading position with 8133.5 tons of gold which make 75.4% of country’s total reserve. Germany runs second with 3391.3 tons and the IMF third with 2814 tons. China and Russia are sitting in sixth and eighth place respectively.
China however is suspected of downplaying its actual volume of gold by 3-4 times, Zerohedge news website reports, and prepares to introduce Yuan as world’s reserve currency. Back in 2009 China set a goal to overtake the US in the rankings. When the Chinese Central bank is ready to officially declare its actual gold reserve volume, world markets will experience serious problems, Zerohedge.com believes.
Major global investor and consulting adviser to the Obama administration, George Soros also appears to have a golden investment streak. In August 2012 it was reported, Mr. Soros offloaded over a million shares in financial companies and banks and purchased $130 million in gold. His move to sell stocks and beef up on gold, is being interpreted by some as a sign of changing investment strategy in the world market.
Wednesday, February 6, 2013
This makes me cry! These poor people need our prayers! Man trampled as hundreds of desperate Greeks scuffle for food
End Of Days News
A fruit and vegetable handout in Greece led to one man being trampled on Wednesday, calling attention to the desperate conditions in the crisis-hit country. Some 55 tons of produce was given away by farmers who were protesting high production costs.
The person was injured when he was pushed by a crowd trying to grab the goods and fell and hit his head.
The chaos was sparked when food stalls ran out of fruits and vegetables, prompting dozens of people to rush to a nearby truck.
It was an “every man for himself” situation as the Greeks shoved their way to the front of the truck, competing for the food that was left. The 55 tons of food was completely gone in under two hours.
A Reuters employee at the scene was hit on the head with cauliflower heads as he attempted to photograph the situation.
People reach out for a bag of oranges during a free distribution of fruit and vegetables by Greek farmers outside the Agriculture Ministry in Athens part a farmers protest against high production costs, including petrol, on February 6, 2013. (AFP Photo / Louisa Gouliamaki)
Kostas Barkas, a lawmaker from the leftist Syriza party, told Reuters.
Other Greek lawmakers said the situation showed images “of people on the brink of despair” and the sense of “sadness for a proud people who have ended up like this.”
It’s a reality that many Greek citizens find hard to comprehend.
"It's difficult. I never imagined that I would end up here," 65-year-old Panagiota Petropoulos said.
"I can't afford anything, not even at the fruit market. Everything is expensive, prices of everything are going up while our income is going down and there are no jobs," she continued.
People line up for fruits and vegetables freely distributed by farmers during a protest against high production costs outside the Agriculture Ministry in Athens February 6, 2013. (Reuters / John Kolesidis)
Greece, which is currently in its sixth year of recession, is experiencing record high unemployment rates. Citizens have been forced to endure wage and pension cuts to satisfy European Union and International Monetary Fund demands.
The handout was an attempt by farmers to persuade the government to give them a 50 per cent price reduction on diesel-powered farm equipment, abolish the obligatory declaration for cultivation and cut Value Added Tax from 23 per cent to 6 per cent on their products and agricultural machinery and equipment.
Strikes continue to take place in various sectors, as workers protest the government’s austerity plan
On Wednesday, Greece’s ruling coalition forced striking seamen to return to work after a six-day action that suspended ferry services to dozens of Greek Islands. The strike led to food and medical shortages.
But when one strike ends, others continue.
Farmers throughout the country are in their ninth day of demonstrations, staging roadblocks with their tractors on highways across Greece on Wednesday.
Journalists working for state broadcasters went into a third day of strikes on Wednesday, protesting against the government’s policies regulating the sector. The strike is scheduled to continue until Thursday.
Various Greek Unions have held a wave of strikes over the past three years to protest the harsh austerity measures taken to secure international rescue loans.
People reach out for a bag of vegetables during a free distribution of fruit and vegetables on February 6, 2013. (AFP Photo / Louisa Gouliamaki)
People reach out to take fruits and vegetables distributed for free by farmers during a protest against high production costs outside the Agriculture Ministry in Athens February 6, 2013. (Reuters / John Kolesidis)
People reach out to take fruits and vegetables distributed for free by farmers during a protest against high production costs outside the Agriculture Ministry in Athens February 6, 2013. (Reuters / John Kolesidis)
People reach out for vegetables during a free distribution of fruit and vegetables on February 6, 2013. (AFP Photo / Louisa Gouliamaki)
The chaos was sparked when food stalls ran out of fruits and vegetables, prompting dozens of people to rush to a nearby truck.
It was an “every man for himself” situation as the Greeks shoved their way to the front of the truck, competing for the food that was left. The 55 tons of food was completely gone in under two hours.
A Reuters employee at the scene was hit on the head with cauliflower heads as he attempted to photograph the situation.
People reach out for a bag of oranges during a free distribution of fruit and vegetables by Greek farmers outside the Agriculture Ministry in Athens part a farmers protest against high production costs, including petrol, on February 6, 2013. (AFP Photo / Louisa Gouliamaki)
"These images make me angry. Angry for a proud people who have no food to eat, who can't afford to keep warm, who can't make ends meet,"
Other Greek lawmakers said the situation showed images “of people on the brink of despair” and the sense of “sadness for a proud people who have ended up like this.”
It’s a reality that many Greek citizens find hard to comprehend.
"It's difficult. I never imagined that I would end up here," 65-year-old Panagiota Petropoulos said.
"I can't afford anything, not even at the fruit market. Everything is expensive, prices of everything are going up while our income is going down and there are no jobs," she continued.
People line up for fruits and vegetables freely distributed by farmers during a protest against high production costs outside the Agriculture Ministry in Athens February 6, 2013. (Reuters / John Kolesidis)
The handout was an attempt by farmers to persuade the government to give them a 50 per cent price reduction on diesel-powered farm equipment, abolish the obligatory declaration for cultivation and cut Value Added Tax from 23 per cent to 6 per cent on their products and agricultural machinery and equipment.
Strikes continue to take place in various sectors, as workers protest the government’s austerity plan
On Wednesday, Greece’s ruling coalition forced striking seamen to return to work after a six-day action that suspended ferry services to dozens of Greek Islands. The strike led to food and medical shortages.
But when one strike ends, others continue.
Farmers throughout the country are in their ninth day of demonstrations, staging roadblocks with their tractors on highways across Greece on Wednesday.
Journalists working for state broadcasters went into a third day of strikes on Wednesday, protesting against the government’s policies regulating the sector. The strike is scheduled to continue until Thursday.
Various Greek Unions have held a wave of strikes over the past three years to protest the harsh austerity measures taken to secure international rescue loans.
People reach out for a bag of vegetables during a free distribution of fruit and vegetables on February 6, 2013. (AFP Photo / Louisa Gouliamaki)
People reach out to take fruits and vegetables distributed for free by farmers during a protest against high production costs outside the Agriculture Ministry in Athens February 6, 2013. (Reuters / John Kolesidis)
People reach out to take fruits and vegetables distributed for free by farmers during a protest against high production costs outside the Agriculture Ministry in Athens February 6, 2013. (Reuters / John Kolesidis)
People reach out for vegetables during a free distribution of fruit and vegetables on February 6, 2013. (AFP Photo / Louisa Gouliamaki)
Some Trader Has Made A Very Big Bet That Something Very Bad Will Happen Within The Next 60 Days
End Of Days News
Meanwhile, the volatility index (aka the VIX, aka the "fear index") is near historic lows.
But according to UBS's Art Cashin, some options trader has made an enormous $11.25 million bet that the VIX will explode higher very soon.
And a rally in the VIX is usually accompanied by a drop in the stock markets
.
From this morning's Cashin's Comments (emphasis ours):
Hopefully, this person is wrong.
Stocks have been rallying relentlessly to post-crisis highs.
Meanwhile, the volatility index (aka the VIX, aka the "fear index") is near historic lows.
But according to UBS's Art Cashin, some options trader has made an enormous $11.25 million bet that the VIX will explode higher very soon.
And a rally in the VIX is usually accompanied by a drop in the stock markets
.From this morning's Cashin's Comments (emphasis ours):
A Very Big Bet In A Somewhat Unlikely Instrument – My friend, Jim Brown, the ever-alert consummate professional over at Option Investor pointed us to a rather unusual trade. Here's what he wrote in last night's edition of his valuable newsletter:
. Here's what he wrote in last night's edition of his valuable newsletter:
In past years I have reported on trades that were so large it appeared someone had inside knowledge of a pending event. Sometimes those were massive put positions on the S&P. A new trade just appeared that suggests there will be a market event in the near future. Last week somebody put on a call spread on the VIX using the April 20 and 25 puts. They bought 150,000 contracts for a net of $75 per contract. That is an $11,250,000 bet that the VIX will move over 20 over the next 60 days. You would have to be VERY confident in your outlook to risk $11 million on a directional position with the VIX at five year lows and the markets trying to break out to new highs.
Jim then goes on to list some of the scheduled events and deadlines visible over the next 60 days (mostly in Washington). When you add in the broad variety of geo-political possibilities, it's a decent reason to stay extra alert.
Panetta: Defense Budget Cuts Will Damage Economy
End Of Days News
Defense Secretary Leon Panetta on Wednesday laid out a grim list of spending
cuts the Pentagon will have to make in the coming weeks that he said will
seriously damage the country's economy and degrade the military's ability to
respond to a crisis.
Slamming members of Congress as irresponsible, Panetta said lawmakers are willing to push the country off a fiscal cliff to damage their opposing political parties.
He said that if Congress doesn't pass a budget the Pentagon will have to absorb $46 billion in spending reductions in this fiscal year and will face a $35 billion shortfall in operating expenses.
"My fear is that there is a dangerous and callous attitude that is developing among some Republicans and some Democrats, that these dangerous cuts can be allowed to take place in order to blame the other party for the consequences," Panetta said in a speech at Georgetown University. "This is a kind of 'so what?' attitude that says, 'Let's see how bad it can get in order to have the other party blink'."
In separate, highly detailed memos sent to Congress, the military services described widespread civilian furloughs, layoffs and hiring freezes that will hit workers all around the country. Overall, the military will furlough 800,000 civilian workers for 22 days, spread across more than five months, and will lay off as many as 46,000 temporary and contract employees.
The Navy says it will cease deployments to South America and the Caribbean and limit those to Europe.
The Air Force warned that it would cut operations at various missile defense radar sites from 24 hours to eight hours. And the Army said it would cancel training center rotations for four brigades and cancel repairs for thousands of vehicles, radios and weapons.
"These steps would seriously damage the fragile American economy, and they would degrade our ability to respond to crisis precisely at a time of rising instability across the globe," Panetta said, adding that the self-made crisis "undermines the men and women in uniform who are willing to put their lives on the line in order to protect this country."
In addition to all of the more immediate cuts, U.S. troops are also likely to see a smaller pay hike next year than initially planned, due to strains on the budget. According to a defense official, the Pentagon will recommend that the military get a 1 percent pay increase in 2014, instead of a 1.7 percent raise.
The Georgetown appearance was likely one of Panetta's last speeches. He is set to leave the Pentagon this month. Former Republican senator Chuck Hagel has been nominated to take his place and a vote by the Senate Armed Services Committee is expected this week.
Read Latest Breaking News from Newsmax.com http://www.moneynews.com/StreetTalk/panetta-Defense-Budget-economy/2013/02/06/id/489181#ixzz2K97pR94k
Slamming members of Congress as irresponsible, Panetta said lawmakers are willing to push the country off a fiscal cliff to damage their opposing political parties.
He said that if Congress doesn't pass a budget the Pentagon will have to absorb $46 billion in spending reductions in this fiscal year and will face a $35 billion shortfall in operating expenses.
"My fear is that there is a dangerous and callous attitude that is developing among some Republicans and some Democrats, that these dangerous cuts can be allowed to take place in order to blame the other party for the consequences," Panetta said in a speech at Georgetown University. "This is a kind of 'so what?' attitude that says, 'Let's see how bad it can get in order to have the other party blink'."
In separate, highly detailed memos sent to Congress, the military services described widespread civilian furloughs, layoffs and hiring freezes that will hit workers all around the country. Overall, the military will furlough 800,000 civilian workers for 22 days, spread across more than five months, and will lay off as many as 46,000 temporary and contract employees.
The Navy says it will cease deployments to South America and the Caribbean and limit those to Europe.
The Air Force warned that it would cut operations at various missile defense radar sites from 24 hours to eight hours. And the Army said it would cancel training center rotations for four brigades and cancel repairs for thousands of vehicles, radios and weapons.
"These steps would seriously damage the fragile American economy, and they would degrade our ability to respond to crisis precisely at a time of rising instability across the globe," Panetta said, adding that the self-made crisis "undermines the men and women in uniform who are willing to put their lives on the line in order to protect this country."
In addition to all of the more immediate cuts, U.S. troops are also likely to see a smaller pay hike next year than initially planned, due to strains on the budget. According to a defense official, the Pentagon will recommend that the military get a 1 percent pay increase in 2014, instead of a 1.7 percent raise.
The Georgetown appearance was likely one of Panetta's last speeches. He is set to leave the Pentagon this month. Former Republican senator Chuck Hagel has been nominated to take his place and a vote by the Senate Armed Services Committee is expected this week.
Read Latest Breaking News from Newsmax.com http://www.moneynews.com/StreetTalk/panetta-Defense-Budget-economy/2013/02/06/id/489181#ixzz2K97pR94k
Sunday, January 27, 2013
AGAIN: US banks shaken by biggest fund withdrawals since 9/11
End Of Days News
US Federal Reserve is reporting a major deposit withdrawal from the
nation’s bank accounts. The financial system has not seen such a massive
fund outflow since 9/11 attacks.
The first week of January 2013 has seen $114 billion withdrawn from 25 of the US’ biggest banks, pushing deposits down to $5.37 trillion, according to the US Fed. Financial analysts suggest it could be down to the Transaction Account Guarantee insurance program coming to an end on December 31 last year and clients moving their money that is no longer insured by the government.
The program was introduced in the wake of the 2008 crisis in order to support the banking system. It provided insurance for around $1.5 trillion in non-interest-bearing accounts with a limit of $250,000. It was aimed at medium and small banks as the creators of the program believed bigger banks would cope with the crisis themselves.
So the current “fast pace” of withdrawal comes as a surprise to financial analysts because the deposits are slipping away from those banks which supposedly were safe. Experts expected savers in small and medium banks would turn to bigger players come December 31.
There are a number of reasons behind this unpredicted fund outflow. Some experts believe it has to do with the beginning of the year when the money is randomly needed here and there. Others have concluded the funds are getting down to business and being invested.
Another set of data from the US Federal Reserve shows some deposits may have moved within the banking system from one type of account to another.
The first week of January 2013 has seen $114 billion withdrawn from 25 of the US’ biggest banks, pushing deposits down to $5.37 trillion, according to the US Fed. Financial analysts suggest it could be down to the Transaction Account Guarantee insurance program coming to an end on December 31 last year and clients moving their money that is no longer insured by the government.
The program was introduced in the wake of the 2008 crisis in order to support the banking system. It provided insurance for around $1.5 trillion in non-interest-bearing accounts with a limit of $250,000. It was aimed at medium and small banks as the creators of the program believed bigger banks would cope with the crisis themselves.
So the current “fast pace” of withdrawal comes as a surprise to financial analysts because the deposits are slipping away from those banks which supposedly were safe. Experts expected savers in small and medium banks would turn to bigger players come December 31.
There are a number of reasons behind this unpredicted fund outflow. Some experts believe it has to do with the beginning of the year when the money is randomly needed here and there. Others have concluded the funds are getting down to business and being invested.
Another set of data from the US Federal Reserve shows some deposits may have moved within the banking system from one type of account to another.
Subscribe to:
Comments (Atom)