Archive - Dec 16, 2009

One of the things that spooked the market yesterday was not so much any concerns of tightening language in today's FOMC statement, as much as a rumor that the Fed was planning on bumping up the discount rate. Krishna Guha, in a blog post, wondered, "might the Fed raise the discount rate at this week’s policy meeting? I think this is a possibility and should be considered as a risk factor. But I would not include a discount rate increase in my base case forecast for the meeting." The key reason for this would be the increasing desire of the Fed to "draw an increasingly sharp distinction between liquidity policy and monetary (interest rate) policy in the spirit of the ECB’s separation principle at this meeting and in subsequent communications." Yet the question remaind: is the Fed about to hike the Discount Rate?

• An unwelcome spotlight falls on SAC Capital (NYT)
• The middle class collapse (HuffPo)
• Congress punts problems to 2010 (Politico)
• As Goldman thrives, some say an ethos has faded (NYT)
• US gave up billions in tax money in deal for Citigroup's bailout payment (WaPo)
• 10 years of booms, busts and bubbles (MarketWatch)

• Asian stocks rise, led by Japanese financial companies; Dollar strengthens.
• Australia's Q3 GDP grew 0.2%- showing growth momentum isn't yet self sustaining.
• FDIC in 2010 plans to add more than 1,600 staffers, mostly to handle bank failures.
• India to levy antidumping duties of as high as more than 3x the value on some Chinese telecommunication equipments.
• Senate rejects plan to import low-cost drugs.
• Sugar jumps to highest price since 1981 in New York on deficit concerns.
• US Industrial output rises 0.8% - most in three months as recovery gains speed.

RANsquawk 16th December Morning Briefing - Stocks, Bonds, FX etc.

We bask in the generous glow of Abu Dhabi's merciful gift to Dubai. Hey, wait a second!