News That Matters

By www.thetrader.se

Ft.com
The European Union approved a ban on oil imports from Iran, overcoming misgivings about the economic hardship of its members to take its strongest measures yet to press Tehran into concessions on its nuclear programme,http://ftalphaville.ft.com/thecut/2012/01/24/847101/eus-iran-embargo-sen...

Japan will probably miss its goal of balancing the budget by fiscal 2020 even if it doubles the nation’s sales tax, according to government estimates, reports Bloomberg. The country will have a primary deficit of 3.1 per cent of GDP in the year,http://ftalphaville.ft.com/thecut/2012/01/24/847031/japan-to-miss-budget...

Orange juice prices hit an all-time high as worries over a possible US ban on Brazilian imports after the discovery of fungicide traces at the end of last year fuelled more speculative buying, the FT reports. http://ftalphaville.ft.com/thecut/2012/01/24/847021/orange-juice-hits-al...

Eurozone finance ministers on Monday night rebuffed a deal presented by private owners of Greek debt as a “maximum” offer for the losses they are willing to sustain, opening a fresh round of brinkmanship in tortuous negotiations to ease the country’s debt load,http://ftalphaville.ft.com/thecut/2012/01/24/846801/santer-to-head-efsf-...

Credit Suisse is to pay employee bonuses with a structured note backed by derivatives that bolsters the Swiss bank’s balance sheet and further cuts the amount of cash as a component of bankers’ pay, http://ftalphaville.ft.com/thecut/2012/01/24/846791/credit-suisse-pays-b...

Angela Merkel is prepared to let the existing EFSF, which has about €250bn in unused funds, run in parallel with its successor, the €500bn ESM, says the FT, citing unnamed German and eurozone officials. In return, http://ftalphaville.ft.com/thecut/2012/01/24/846671/berlin-ready-to-see-...

“Pakistan is facing very severe threats from both sides – India is one side, America and Nato forces are on the other, and the agenda of both is Pakistan,” Mr Saeed told the Financial Times. “We want to send a message to them that the defence of Pakistan is uppermost in our minds.” Fist-waving speakers told the throng – which included boys sporting black and white headbands and brandishing sticks – that India would be sundered into quarters.http://www.ft.com/intl/cms/s/0/4d3094f6-45ce-11e1-acc9-00144feabdc0.html...

Iran has attacked Brazilian President Dilma Rousseff for overseeing a chilling of ties between the two countries, jeopardising a relationship that had once been a major irritant to the US. Iran believed Ms Rousseff was undermining the efforts of her predecessor Luiz Inácio Lula da Silva, under whom Brazil had been virtually the only major western country with friendly ties to the regime of President Mahmoud Ahmadi-Nejad, a spokesperson said in the Brazilian press.http://www.ft.com/intl/cms/s/0/881b4494-45e7-11e1-9592-00144feabdc0.html...

Wsj.com
The global economy faces a depression-era collapse in demand if Europe doesn’t quickly act to dramatically boost the size of its debt-crisis firewall, implement pro-growth policies and further integrate the euro zone, the head of the International Monetary Fund warned Monday. “It is about avoiding a 1930s moment, in which inaction, insularity, and rigid ideology combine to cause a collapse in global demand,” IMF Managing Director Christine Lagarde said in prepared remarks before the German Council of Foreign Affairs in Berlin. “A moment, ultimately, leading to a downward spiral that could engulf the entire world,” she said. http://online.wsj.com/article/SB1000142405297020380650457717850169131880...

One of the world’s greatest export engines is running out of steam. For decades, Japan used the combination of manufacturing might and an export-oriented trade policy to shower markets around the world with its cars and consumer electronics and semiconductors. No longer. The Japanese government is expected to announce Wednesday that the country recorded its first annual trade deficit since 1980. If the yen remains strong and global demand weak, economists warn that Japan could run trade deficits for years to come.http://online.wsj.com/article/SB1000142405297020462420457717864252760599...

Taking a drastic step to stem a glut of natural gas that has pushed prices down 45% in the last year, the nation’s second-largest producer said it will slash gas drilling by nearly half. The move is an abrupt turnabout by Chesapeake Energy Corp., which calls itself “America’s Champion of Natural Gas” and helped pioneer drilling techniques that have opened up swaths of the U.S. to energy produced from shale rock. So much gas-rich shale has been found, however, that federal and private forecasters predict an oversupply will last for years.http://online.wsj.com/article/SB1000142405297020380650457717865173251197...

The U.K. government announced plans to curb excessive executive pay Monday, including increasing transparency and shareholder control of salaries, greater diversity of boards and remuneration committees, and encouraging best practice in the business community. Business Secretary Vince Cable told lawmakers there was a recognized disconnect between top pay and company performance and something must be done, although he acknowledged it wasn’t the government’s role to micro-manage company pay. http://online.wsj.com/article/SB1000142405297020380650457717897381197013...

Investors, economists and politicians are increasingly concerned that Portugal will need a second bailout as fears mount that it won’t be able to return to markets for financing next year. While the Portuguese government’s finances are covered this year as long as it abides by its bailout agreement, Portugal must regain full access to capital markets next year to help repay €9 billion ($11.64 billion) in debt coming due in September 2013.http://online.wsj.com/article/SB1000142405297020380650457717891128172092...

Average annual salaries for Silicon Valley technology workers surpassed the $100,000 mark last year, according to a new survey, pushed higher by the strength of the region’s latest boom.Tech-jobs website operator Dice Holdings Inc. said salaries for software and other engineering professionals in California’s Silicon Valley rose 5.2% to an average $104,195 last year, outstripping the average 2% increase, to $81,327, in tech-workers’ salaries nationwide. It was the first time since Dice began the salary survey in 2001 that the wage barometer broke the $100,000 barrier, said Tom Silver, a Dice senior vice president.http://online.wsj.com/article/SB1000142405297020462420457717919375243559...

Marketwatch.com
Asian shares advanced modestly Tuesday, with energy firms higher after the European Union announced it’s planning an embargo of Iranian oil exports. The Japanese Nikkei Stock Average ended the morning session with a gain of 0.4%, while the Australian S&P/ASX 200 index  advanced 0.3%. South Korean, Chinese and several other Asian stock markets were closed for the Lunar New Year holiday. http://www.marketwatch.com/story/asian-stocks-advance-with-energy-shares...

Reuters.com
- Russian liberal opposition leader Grigory Yavlinsky could be barred from running against Vladimir Putin in a presidential election after officials said Monday there were problems with his registration as a candidate. Opinion polls show Yavlinsky has no chance of winning the March 4 election but the refusal to let him run would be a slap in the face for leaders of protests by tens of thousands of demonstrators demanding fair elections and political reform.http://www.reuters.com/article/2012/01/23/us-russia-yavlinsky-idUSTRE80M...

The Federal Reserve could take the historic step this week of announcing an explicit target for inflation, a move that would fulfill a multi-year quest of the central bank’s chairman, Ben Bernanke. An inflation target would be the capstone of Bernanke’s crusade to improve the Fed’s communications, an initiative aimed at making the central bank more effective at controlling growth and inflation. It would, at long last, bring the Fed into line with a policy framework used by most other major central banks. http://www.reuters.com/article/2012/01/22/us-usa-fed-target-idUSTRE80L0N...

Brent crude held above $110 on Tuesday on supply concerns as some Iranians renewed their threat to block Arab oil from leaving the Gulf, while fears over demand growth stemming from protracted negotiations over Greece’s debt capped any gains. Front-month Brent crude rose 6 cents to $110.64 a barrel by 0215 GMT, gaining for a second day. U.S. crude fell 5 cents to $99.53, closing above the 50-day moving average of $99.13 and touching an intraday high of $100.24 http://www.reuters.com/article/2012/01/24/us-markets-oil-idUSTRE7AD06820...

Bloomberg.com
Republican presidential candidate Mitt Romney earned $21.6 million in 2010 and paid 13.9 percent of that amount in income taxes, using the preferential rate on investment income and charitable deductions to pay a smaller share of his earnings than top wage earners typically do.  The former private-equity executive and Massachusetts governor earned more than half of his income from capital gains and dividends, which are taxed at a top rate of 15 percent, rather than the 35 percent top rate for ordinary income. His campaign showed his tax returns to reporters last night and will release them publicly today.http://www.bloomberg.com/news/2012-01-24/romney-paid-13-9-percent-tax-ra...

Skandinaviska Enskilda Banken AB (SEBA) and Daiwa Securities Group Inc. (8601) have underwritten the most green bonds since the securities were first issued in 2007, indicating the dominance of Swedish and Japanese banks in the market. Five of the 10 top underwriters on about $7 billion of the bonds issued by international finance institutions were drawn from the two countries, according to a ranking by Bloomberg New Energy Finance released today. London-based HSBC Bank Plc and JPMorgan Chase (JPM) & Co. of New York took third and fourth place. http://www.bloomberg.com/news/2012-01-23/green-bond-underwriters-from-ja...

Cnbc.com
The regulator for Fannie Mae and Freddie Mac told lawmakers that forcing the two mortgage firms to write down loan principal would require more than $100 billion in fresh taxpayer funds. In a letter sent Friday to the Republican and Democratic leaders of a U.S. House of Representatives government oversight panel, the Federal Housing Finance Agency explained why it has long opposed principal reductions for borrowers who owe more than their homes are worth.http://www.cnbc.com/id/46106075

Foxbusiness.com
Xi Jinping, China’s vice president who is widely expected to become president this year, will visit the White House on Feb. 14, the White House said. It’s the second of planned reciprocal visits between the vice presidents, as U.S. Vice President Joe Biden visited China in August. Xi will meet with President Barack Obama, Biden and other senior officials, and also travel to Iowa and California, the White House said.http://www.foxbusiness.com/markets/2012/01/23/chinas-xi-to-visit-white-h...

BBC.co.uk
The outlook for the global labour market has worsened from last year, the International Labour Organization (ILO) says. It called the situation an “urgent challenge” and said governments needed to create 600 million jobs over the next decade. The ILO said it was more pessimistic because of the weaker global economy.  It added that globally some 1.1 billion people were either unemployed or living in poverty. http://www.bbc.co.uk/news/business-16695096

Telegraph.co.uk
Controversial plans for a Europe-wide financial transaction tax “will not be imposed on the UK against its will”, according to EU markets chief Michel Barnier. Mr Barnier, who was addressing a sceptical audience at London’s Guildhall, sparked audible laughter when he claimed “there is no plot in Europe to undermine the City”. Instead, he insisted the UK’s place was “at the heart of Europe” and that the City must learn to “play the European game” and give up seeking UK exemptions that threaten to endanger open trade.http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9034159/...

The Spanish economy shrank by 0.3pc in the fourth quarter of 2011, the country’s central bank said, reflecting falling domestic demand and slowing exports. The Bank of Spain warned the nation’s economy would fall back into recession this year, contracting by 1.5pc in 2012 as a whole. It estimated the economy grew by 0.7pc last year. “During 2011, the modest recovery on which the Spanish economy had embarked a year earlier lost momentum as the euro area sovereign debt crisis spread to a larger number of countries and strains on financial markets heightened,” the Bank said in a report.http://www.telegraph.co.uk/finance/financialcrisis/9032318/Spanish-centr...

Mortgage lending increased for the fifth month running in December but the housing market faces a weak first half of 2012 as demand from buyers wanes and lenders raise rates, a leading trade body has warned. The Council for Mortgage Lenders (CML) said the “challenging” economic outlook suggested “a weak first half for the housing market” despite the improving trend at the end of last year. Gross mortgage lending for 2011 totalled £140bn, marginally above the CML’s forecast of £138bn and a 3pc increase on 2010. Lending in December was an estimated £11.7bn, a 12pc rise year-on-year.http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/9...

Independent.co.uk
The International Monetary Fund will next week forecast a return to recession for the eurozone in 2012, a move likely to increase the pressure on governments to contribute to its latest $600bn (£388bn) fundraising drive. The IMF is scheduled to release its revised World Economic Outlook (WEO) estimates on Monday, with analysts expecting a sharp reduction because of the ongoing eurozone crisis. According to the Italian agency, Ansa, citing a leaked draft of the WEO, the IMF will forecast that the eurozone economy will contract by 0.5 per cent over the course of this year, with Italy shrinking by 2.2 per cent and Spain by 1.7 per cent. At the IMF’s meeting in September 2011, it forecast eurozone growth in 2012 of a comparatively healthy 1.1 per cent.http://www.independent.co.uk/news/business/news/eurozone-back-in-recessi...

Guardian.co.uk
US mortgage lenders ‘close to $19bn foreclosure settlement’. US president Barack Obama could announce a deal – the largest multi-state agreement since the 1998 tobacco settlement – in Tuesday’s state of the union address. The US’s five largest mortgage lenders are close to signing off on a massive settlement over deceptive foreclosure practices that drove people out of their homes, according to government officials.The price of the settlement has been estimated at between $19bn (£12.2bn) and $25bn and would be the largest multi-state agreement since 1998?s deal with the tobacco companies. On Monday Democrat politicians suggested President Barack Obama could announce a deal later today, when he delivers his state of the union address.http://www.guardian.co.uk/business/2012/jan/23/us-mortgage-lenders-forec...

Theglobeandmail.com
The euro zone may be suffering from a severe debt crisis that threatens to unravel the currency union, but at least one outsider still wants to join the 17-country club. That would be tiny Iceland, which barely survived a crushing financial crisis in 2008 that blew up its banking system, nearly wiped out the economy and flattened its independent currency, the krona.http://www.theglobeandmail.com/report-on-business/international-news/eur...

Economictimes.com
The Reserve Bank of India in its quarterly review meet on Tuesday cut the cash reserve ratio (CRR) by 50 bps to ease tight liquidity pressure in the banking system. RBI kept repo and reverse repo rates unchanged at 8.5% and 7.5% respectively, despite mounting anxiety over slowdown in growth.  The cash reserve ratio, the proportion of deposits that banks have to hold with the RBI, is a popular instrument to inject cash into the system. It now stands at 5.5%. Tuesday’s cut lowers the CRR to 5.50 per cent from 6.00 per cent, where it had stood since April 2010, and releases Rs 32,000 crore ($6.4 billion) of liquidity into the banking system, the RBI said. http://economictimes.indiatimes.com/news/economy/policy/credit-policy-rb...

The government is ready with a plan to act against countries that provide subsidy to local producers and make exports more competitive. Although anti-subsidy action is a trade defence measure, permitted by the World Trade Organisation (WTO), the move is expected to hit China the most. Commerce department officials told reporters that the government is setting up a Directorate General of Trade Remedies ( DGTR) over the next few weeks, which will deal with anti-subsidy and countervailing action. http://economictimes.indiatimes.com/news/economy/foreign-trade/indias-an...

Yonhapnews.co.kr
South Korea’s potential growth rate may have fallen into the upper 3 percent range due to a drop in business investments and labor input, a private think tank said Tuesday. The findings by the Hyundai Research Institute (HRI) showed the country’s growth potential slipping to 3.8 percent in the 2008-2012 period from 4.7 percent reached in the preceding 10 years. “Less business investments, labor input and the relatively weak domestic economy, as well as delays in the development of new economic growth industries, have all contributed to weaker potential growth numbers,” the institute said.http://english.yonhapnews.co.kr/business/2012/01/24/3/0501000000AEN20120...

Khaleejtimes.com
Argentina’s economy grew 7.6 percent in November from a year earlier, marking the slowest expansion in 13 months as sluggish global demand and fallout from Europe’s debt woes began to take a toll.  The EMAE economic activity index, a close proxy for gross domestic product, rose 0.8 percent in November versus October.  Latin America’s No. 3 economy is being driven by state-stimulated domestic demand, lucrative grains exports and factory output that relies heavily on the Brazilian market. But the incipient slowdown is expected to deepen this year. http://www.khaleejtimes.com/biz/inside.asp?xfile=/data/economicindicator...

Thetrader.se
Biggs is bullish on stocks, but nervous at the same time. Not really what we wanted to hear after this Santa run up. Biggs is according to himself, “nervous he is not long enough, but if the market goes down, he is nervous he is still 65% long”. Video below. http://www.thetrader.se/2012/01/23/bigg-nervously-bullish-on-stocks/