EurAnalysis

Ok mate i like your post anyway no offense

Is this important? Federal Reserve Bank of Cleveland President Sandra Pianalto Speaks.

EU may test 2480 levels from here , PA has just given a hint and is weak to find a close above 2530 ? this is a range play in btw 2480 and 2565 for the day .

No offence taken bro. Just simply stating my position so that nobody thinks that I am over leveraged and underwater... coz I'm not

She is known to be a very dovish Fed president.

Intraday range trading is the way to go for this last week of holidays and also a pause and indecision leading up to the much anticipated speeches by Bernanke and Draghi this coming Friday and Saturday.

Caution would be prudent though as any spinning of the facts and diatribe by the talking heads can spike this puppy either way in the next few days.

Some chart would be better . right So here we go

Some pertinent info on the FOMC members and governers.

Current members

The members of the FOMC during 2012 are:

Ben S. Bernanke, Board of Governors, Chairman
William C. Dudley, New York
Elizabeth A. Duke, Board of Governors
Jeffrey M. Lacker, Richmond
Dennis P. Lockhart, Atlanta
Sandra Pianalto, Cleveland
Sarah Bloom Raskin, Board of Governors
Daniel K. Tarullo, Board of Governors
John C. Williams, San Francisco
Janet L. Yellen, Board of Governors, Vice Chairman

Alternate Members for 2013:

James Bullard, St. Louis
Charles L. Evans, Chicago
Esther George, Kansas City
Eric S. Rosengren, Boston
Christine M. Cumming, First Vice President, New York

Federal Reserve Bank Rotation on the FOMC:

Committee membership changes at the first regularly scheduled meeting of the year.
2012 Members - New York, Richmond, Atlanta, Cleveland, San Francisco
2013 Alternate Members - New York, St. Louis, Chicago, Kansas City, Boston
(Note: For the Federal Reserve Bank of New York, the First Vice President is the alternate for the President.)

Source: http://en.wikipedia.org/wiki/Federal...rket_Committee

Bernanke-Draghi: Jackson Hole vs. Leen’s Lodge
August 27, 2012

"Five years into the financial crisis, the exit for central banks from their stimulus efforts is nowhere in sight and even may be getting further away." (Richard Barley. “Central Banks’ Incredible Lightness of Easing.” Heard on the Street. WSJ.com. August 26, 2012)


Second-quarter GDP revisions will likely put the growth rate of the US economy above two percent. That estimate is high enough to stop any QE3 action from Jackson Hole. We expect lots of Fed rhetoric and some mixed comments as media interviews occur. The media will have nothing to do but cover a conference where presentations will be made and decisions will be deferred. The Fed retreat in Jackson Hole is the place for the national media to earn its pay.


Mario Draghi has already declared to do “whatever it takes.” We do not expect anything new from Draghi or the European Central Bank until several events occur. They are scheduled for September.

The troika (IMF, European Commission, and ECB) will inspect Greece but will not yank funding. Greece will likely pass the tests with a B+, a C-, or an intermediate grade that suggests Greece is trying but needs to do a little more, to try harder and achieve more results. Greece will get enough money to roll back the debt it owes to the institutions the troika represents.


That paves the way for the next issue. The German constitutional court decision (currently scheduled for September 12, 2012) may say yes to the ESM (European Stability Mechanism), it may say no (this is highly unlikely), or it may say yes with certain modifications. We do not know. Finding a form to complete the ESM is the most likely outcome. Furthermore, the brain trust that operates the eurozone will come up with a different mechanism if no form is found by the constitutional court.


Once the ESM is in place, it can be funded through the ECB, which means a very large QE at the ECB level. Perhaps a banking license will be granted to the ESM, and several countries will become immediate recipients. Spain, Italy, and Ireland will be among them. There will suddenly be a very large liquidity infusion of newly created euros that will drive down interest rates and narrow the spreads among the various members of the eurozone. That is the outcome to expect in September.


Questions: Will any of this improve the economic growth rates of the European countries? Perhaps some improvement will occur in some countries, but will those improvements be dramatic? That is not clear, since structural reforms have not been implemented meaningfully in those countries. What will this do for banking systems in countries like Spain? It should amount to some modest help, since it is a subsidy to the banking system. Not a lot of help, since the banking systems still hold assets that are under water and inadequately reserved for the upcoming damages. Will runs on banks in countries such as Greece, Portugal, Spain, and Italy subside, so that their banking systems can regain functionality? Perhaps there will be some restoration of confidence and the bleeding will lessen.


What does all of this mean for markets? That is the biggest unanswered question. Foreign markets are watching China’s weakness. The second largest economy in the world is struggling with serious questions about its regrowth. In Europe, growth rates are not expected to improve even if the ECB liquidity infusion occurs.


In the US, the slow-growth approach and fiscal-cliff uncertainties of an unclear election outcome impede an economy that is struggling under the burden of a large negative output gap (read: high unemployment). There is a realization that the Federal Reserve can not, will not, and should not do any more. It does not have a reason to.

The above leave us to end August with a large uncertainty premium.


What to do? The first thing to do is avoid 70 thousand of your closest personal friends on the west coast of Florida. Some of them will be in Sarasota, but they will miss us. The second thing is to try to duck the damage that may be done by Hurricane Isaac. Isaac’s most likely impact is on oil-drilling platforms in the Gulf of Mexico. It may go on to dump copious amounts of rain in sections of the US that need it.


We will escape to Maine and chase some friendly bass or pickerel in the pristine waters of the St. Croix River watershed at Leen’s Lodge. Our small group will talk about the economics and politics of the world and look for pre-autumn color. At last check there were a few empty spots at the lodge, in case any venturesome souls want to head in that direction at the last minute. We wish our readers all the best for the Labor Day weekend. There is much to observe and plenty of fireworks coming in September.


For the size of those growing central bank balance sheets and for the interest rates and credits spreads, see the weekly updated series in the middle of our homepage, www.cumber.com.


David R. Kotok, Chairman and Chief Investment Officer

good morning all,

what happen with oil price? why such a big drop when oil refineries are shutting down due to this gulf storm hitting? shouldn't oil go up because of lack of supply?
thanks,
G

it is my understanding that the contract price of refined products and crude oil float independently, thought usually with a high degree of correlation...however supply side factors that affect refined products alone (such as a refinery accident or weather shutdown) can cause divergence.

Top Stories

Samsung shares plunge after $1.05B patent loss to Apple. Samsung's (SSNLF.PK) shares tumbled 7.45% in Seoul today following its $1.05B patent defeat to Apple (AAPL) on Friday, with the latter climbing 2.35% premarket, Nokia (NOK) jumping 11.4% and Microsoft (MSFT) edging up 0.8%. Apple has until today to outline which Samsung devices it wants to ban from being sold in the U.S. Read market currents for a summary of the latest reaction and analysis.

Hertz doesn't thrift as it agrees to buy Dollar Thrifty for $2.3B. After two years of trying, Hertz (HTZ) is set to acquire Dollar Thrifty (DTG) in a deal worth $2.3B. The price of $87.50 a share represents a premium of 8% on the latter's close of $81 on Friday, and is more than double the $41 that Hertz offered in 2010. To help get regulatory approval, Hertz has agreed to sell its Advantage Rent-A-Car unit to Franchise Services of North America and Macquarie Capital.

Drought to lead to massive losses for insurers. The drought will probably cause insurers their biggest agricultural loss ever, with gross indemnities of $30B and an underwriting loss of $18B. However, the government will pay for $14B through reinsurance programs and private firms $4B-$5B. Companies with exposure include QBE (QBEIF.PK), American Financial (AFG) and Wells Fargo's (WFC) Rural Community.

Top Stock News

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Tiffany earnings edge up. Tiffany's (TIF) Q2 earnings were in line with its own expectations but came in just below those of analysts. Net profit rose 2% to $92M, or $0.72 a share, while revenue increased by the same amount to $887M. Sales to the Americas and Europe slipped 1% but grew 1% in Asia Pacific. The jeweler lowered its FY EPS guidance to $3.70-$3.80 from a prior outlook of $3.95-$4.04.

Opel denies plans to cut 1/3 German jobs. GM's (GM) European unit Opel has denied a report in Germany's Bild newspaper that it intends to slash a third of jobs in the country. The cuts would be part of a phased strategy that also includes reducing working hours, a move that Opel announced last week.

Insurers could face rules to up capital requirements by billions. State regulators are looking at changes that would force insurers such as AIG (AIG) and MetLife (MET) to increase by billions of dollars the amount that they would have to hold against the riskier mortgage bonds they've been acquiring lately. The National Association of Insurance Commissioners could implement the changes later this year in a move that could cool interest in the once-toxic assets.

Ford breaks ground on new China plant in quest for growth. Ford (F) has broken ground on a factory in Chongqing in southwest China, where it plans to start making its 2-liter EcoBoost turbocharged engine. Although the country's market is cooling, Ford - and other car makers - see "a tremendous growth opportunity in the middle and the west."

U.S. probes Unicredit over Iran. Add Unicredit (UNCFF.PK), Italy's largest bank, to the growing list of financial institutions being investigated in the U.S. for breaking sanctions on certain countries, with reports saying that one of those countries is - surprise surprise - Iran.

Top Economic & Other News

ECB mulls flexibility for any bond-buying program. The latest bond-buying scheme that the ECB is considering involves using informal, flexible yield targets, the WSJ reports. It's a strategy that would theoretically preserve the bank's ability to change course and maintain pressure on governments over reform and budgets. Unlike before, the ECB would divulge far more details of its activities in order to guide the markets as to its intentions.

Spain will probably need €60B of bailout - Economy Minister. Spain expects to use approximately €60B of the €100B available for its bank rescue, Economy Minister Luis de Guindos has told the NYT. Meanwhile, economists have found a discrepancy that allows Spain's regional governments to exceed their agreed 2012 budget deficit targets by €1.2B, or 8%, which won't do much for the credibility of the country in its program to cut its overall deficit and get that bailout.

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Today's Markets:

In Asia, Japan +0.2%. Hong Kong -0.4%. China -1.7%. India -0.6%.
In Europe, at midday, London closed. Paris +0.1%. Frankfurt +0.3%.
Futures at 7:00: Dow +0.1%. S&P +0.3%. Nasdaq +0.5%. Crude +1% to $97.08. Gold flat at $1672.90.

Today's economic calendar:
10:30 Dallas Fed Manufacturing Outlook
12:15 PM Fed's Pianalto: Monetary Policy and Economic Outlook
6:15 PM Fed's Evans: Economic Outlook and Monetary Policy

CNBC is saying that hurricane Isaac was downgraded.
Also hearing reports that Iran is now going to allow the IAEA to visit and inspect their nuclear site so geopolitical risk now reduced. Don't know which one caused it or if it was a combination of the two.

Spain revises 2011 GDP growth to 0.4% from 0.7% --Revision doesn't affect 2011 debt-to-GDP ratio --Revision also hits economic contraction in 2010

2011 debt to GDP ratios are history and now irrelevant.
What I would like to see is some projections for the 2012 debt to GDP ratio.

It could be due to Japan export slump hearing few days ago. Not sure.

But U/CAD is not picking up yet. So really not sure.

Uh this thread is moving too fast for me. Hope U/CAD can move as fast. It doesn't move at all

Something is not right U/CAD doesn't move. Intervention?

hello, i want to ask u? what it mean? are the spain economic condition are not good? so what the impact to the EUR currency?