Rampant overproduction, channel stuffing, and an inventory glut: the China auto bubble is hissing.
Investing in an uncompetitive company in the ugly EU auto market to bail out its own failing subsidiary.
- With a 2 Year delay, both FT and WSJ start covering the shadow banking system. For our ongoing coverage for the past 2.5 years see here.
- Trouble in shipping turns ocean into scrapheap (Telegraph)
- First-Quarter Home Prices Down 20.7% in Capital (China Daily)
- Bernanke Says Banks Need Bigger Capital Buffer (Reuters)
- Monti’s Overhaul Can’t Stop Pain From Spain: Euro Credit (Bloomberg)
- Spain Confronts Crisis Threat as Rajoy Seeks Deficit Cuts (Bloomberg)
- Japan’s Noda Announces Anti-Deflation Talks as BOJ Sets Policy (Bloomberg)
- White House makes case for Buffett Rule (CNN)
- Cameron to Make Historic Myanmar Trip (FT)
- 'Time for Closer Ties' With India (China Daily)
As Iran tensions mount, even the US Military needs a break and where better than The Hamptons to practice desert-driving skills? As SouthamptonPatch notes, a military spokesman said M1117s that drove through Southampton, East Hampton and Southold were not on the East End for a funeral, as previously reported. Perhaps its nothing more suspicious than a cabal of FX traders and hedge fund managers building their own fortification to protect their champagne but we must all appreciate them filling up with gas and helping our economy recover (credit or debit?).
- Angela Merkel casts doubt on saving Greece from financial meltdown (Guardian)
- Germany Rejects ‘Indecent’ Call to ECB on Greece, Meister Says (Bloomberg)
- Obama Calls for Higher Taxes on Wealthy (Bloomberg)
- Fed set to push back timing of eventual rate hike (Reuters)
- Recession Looms As UK Economy Shrinks By 0.2%, more than expected (SKY)
- King Says BOE Can Increase Bond Purchases If Needed to Meet Inflation Goal (Bloomberg)
- When One Quadrillion Yen is not enough: Japan's first trade deficit since 1980 raises debt doubts (Reuters)
- Sarkozy to quit if he loses poll (FT)
- U.S. Shifts Policy on Nuclear Pacts (WSJ)
- ECB under pressure over Greek bond hit (FT)
- Fed Holds Off for Now on Bond Buys (Hilsenrath)
- Bonds Show Return of Crisis Once ECB Loans Expire (Bloomberg)
- Greek Debt Talks Enter Third Day After ‘Substantial’ Discussions (Bloomberg)
- Sharp clashes at Republican debate ahead of vote (Reuters)
- Lagarde Joins Warning on Fiscal Cuts Before Davos (Bloomberg)
- Investors exit big-name funds as stars fail to shine (Reuters)
- Payday lenders plead case to consumer agency (Reuters) - the EFSF included?
- EU Toughens Fiscal Pact Bowing to ECB Objections, Draft Shows (Bloomberg)
- Minister Urges Japan to Use Strong Yen (FT)
- China Eyes Pension Fund Boost for Stock Market (Reuters)
- China Manufacturing Contraction Boosts Case for Easing: Economy (Bloomberg)
- Italy Is Biggest Risk to Euro, Says Fitch (WSJ)
- Greek Bailout in Peril (WSJ)
- Swiss Currency Test Looms for SNB’s Jordan in Race to Replace Hildebrand (Bloomberg)
- Daley to Depart as Obama Shifts Strategy From Compromise to Confrontation (Bloomberg)
- BOE Stimulus Expansion May Not Be Enough to Revive U.K. Recovery, BCC Says (Bloomberg)
- Geithner in China to Discuss Yuan, Iran (Bloomberg)
- China Won’t See Hard Landing in 2012, Former PBOC Adviser Yu Yongding Says (Bloomberg)
- Measures to boost China financial markets (China Daily)
- Obama Panel to Watch Beijing (WSJ)
Remember the massive surge to world GDP courtesy of the Japanese disaster spouted by every idiot on CNBC? Well, here we go:
- TOYOTA SAYS WILL HAVE TO SHUT DOWN N. AMERICAN FACTORIES
- TOYOTA SAYS SHUTDOWNS MAY AFFECT 25,000 WORKERS
This is massively bullish for horse buggies and Flintstonemobiles.
Skip General Motors, which is getting over inflated through a combination of media and government hype. Today Toyota, the world’s largest car maker, has been slammed by the perfect storm. Toyota has become the BP of the auto industry. Since the company is Japan’s largest exporter, it would benefit greatly from any weakness in the yen. Buy when there is blood in the streets. (TM), (FXY).
There should be no excuses for a better than expected February for auto sales... Toyota is down (and the domestic competition would have you believing "out" as well...) But how did the other major brands perform in February, which is traditionally a shitty month to sell a car?