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Frontrunning: August 20

Tyler Durden's picture




 
  • Caterpillar warns on global uncertainty (FT)
  • Only 3 years behind the curve as usual: Moody’s warns on California city defaults (FT)
  • Monti Says ‘Tragedy’ If Euro Became a Factor of Disruption (Bloomberg) - the same Monti whose disruptive comments recently enraged Germany?
  • China Home Prices Climb in More Cities Prompting Policy Concerns (Bloomberg)
  • China's Big Four boost new bank loans in Aug first half (Reuters)
  • EU Leaders Plan Shuttle Talks to Bolster Greece (Bloomberg)
  • US rule set to slash cars’ fuel use (FT)
  • Spain Seeks Commitment From Central Bank on Bond Buys (WSJ)... and preferably completely unconditional
  • Finnish Euro Doubts Hide Business Plea to Commit to Currency (Bloomberg)
  • Carlson Chief Steps Down To Take Best Buy's Top Job (WSJ)
  • German politicians say no leeway for Greece on reforms (Reuters)

Overnight Media Digest

WSJ

* Gu Kailai, the wife of ousted Communist Party official Bo Xilai, was found guilty and given a suspended death sentence on Monday for the murder of British businessman Neil Heywood. The judgment paves the way for an announcement on how the party plans to deal with Bo.

* Aetna has struck a deal to buy Coventry Health Care for $5.7 billion in cash and stock, a move that will make Aetna one of the largest providers of government-financed health care.

* General Motors is close to reaching an agreement with labor representatives to shorten the workdays at some of its German plants, a move to help stem financial losses in its European operations.

* The Chicago Mercantile Exchange Group plans to establish a European derivatives exchange and will submit its license application to the U.K.'s Financial Services Authority "within days."

* Lee Raymond, the brusque former chairman and chief executive of Exxon Mobil, will have the last say on James Dimon's role in the "London Whale" trading fiasco-an arrangement that presents risks for both men.

* Belize, a Central American nation with an economy the size of Pine Bluff, Arkansas, is running out of money to pay its debts. But the tiny country is playing hardball with its lenders.

* Novartis AG goes to India's Supreme Court on Wednesday to seek patent protection for its blockbuster cancer drug Glivec in a case that could deliver far-reaching ramifications for multinational pharmaceutical companies operating in India.

* Royal Dutch Shell is spending billions of dollars to drill the first oil wells in U.S. Arctic waters in 20 years, backed by an Obama administration eager to show it wasn't opposed to offshore exploration.

* Asian consumers have kept their countries' economies humming while exports to Europe and the U.S., long key sources of growth, have been a drag. Now there are signs consumer spending also is ticking down, which is bad news for one of the global economy's few bright spots.

* U.S. regulators are delaying rules that would allow hedge funds and other firms to solicit investors more broadly, a win for advocates who said hasty changes to solicitation rules could increase fraud.

* A federal court jury this week is set to begin tackling a question that has consumed the mobile-device market: Did Samsung Electronics Co rip off features of Apple Inc's iPhone and iPad? But there are actually many questions

 

FT

CALL TO LIMIT CHINA UK NUCLEAR SALE -

Chinese companies competing for one of the UK's biggest nuclear projects are unlikely to end up with a majority stake in any winning consortium.

ANTI-JAPANESE PROTESTS SWEEP CHINA

The biggest anti-Japan street protests in seven years flared across China on Sunday.

NORGES FUND PLANS TO TAKE ON MORE RISK

The world's largest sovereign wealth fund, the Norwegian oil fund, is planning to take on more risk.

CME PLANS EUROPE DERIVATIVES EXCHANGE

CME Group, the world's largest futures exchange operator, will on Monday unveil plans for a European derivatives market.

EARNINGS PROSPECTS IN EUROPE SCALED BACK

A disappointing second-quarter earnings season in Europe has prompted analysts to scale back their expectations for earnings growth for the rest of 2012.

CATERPILLAR WARNS ON GLOBAL UNCERTAINTY

The global economic outlook is more uncertain than at the start of the crisis in late 2008, according to Caterpillar .

HAY BECOME KEY US COMMODITY

Hay has become a key commodity in the U.S. agricultural market, with price gains in drought-stressed areas outpacing corn.

VIRGIN RAIL SEEKS REASONS FOR FRANCHISE LOSS

Virgin Rail is pushing the government to provide detailed feedback on why it lost the contest to run the UK's West Coast rail franchise.

TREASURY WEIGHS GERMAN 'MINI JOBS' SCHEME

British treasury ministers are considering the introduction of German-style "mini jobs", which exempt workers from tax and national insurance.

G4S TO WITHDRAW FROM PAKISTAN

G4S is set to pull out of Pakistan amid an increasingly hostile environment for foreign security companies.

 

Canada

THE GLOBE AND MAIL

* Corrections Canada faces years of big budget cuts even as its resources are stretched increasingly thin. The federal agency must trim $295 million in spending by 2015 as part of the Conservative government's deficit-reduction program.

Reports in the business section:

* General Motors of Canada Ltd is tackling a broad array of costs, making substantial changes to pension plans and health-care benefits for its salaried employees as it kicks off wage negotiations with its unionized workers.

NATIONAL POST

* It has little money or organization, but Quebec's Conservative party, which once ruled the province before falling into oblivion, is trying to make a comeback in the Sept. 4 election.

FINANCIAL POST

* With home-ownership rates headed for record levels and the federal government tightening lending rules to cool the market, the question now is whether we have reached the saturation point.

 

Russia

VEDOMOSTI

- Russia's central bank has authorized commercial banks to monitor from Oct. 1 the export transactions of their clients as a measure to establish pathways of illegal capital outflow.

- President Vladimir Putin has approved the merger of assets of Moscow airports land facilities to set up a state company, the daily reports.

- Russian authorities consider the two-year jail sentences handed down to three women from punk band Pussy Riot appropriate and not severe, the daily says.

KOMMERSANT

- Apple Inc. is planning to ensure direct computer supplies to Moscow and St Petersburg by 2013 through its subsidiary Apple-Rus, which has been recently registered in Russia.

IZVESTIA

- The Federation of Independent Trade Unions plans to initiate a bill to raise Russia's mininum monthly wage from 4,611 roubles ($140) to match the minimum subsistence level of 6,307 roubles ($200). Almost 13 percent of Russia's population is earning less than that, the daily says.

ROSSIISKAYA GAZETA

- Russia's economy will be able to survive a fall in oil prices $60 per barrel, though it could affect the value of the rouble and peoples' incomes, the daily says citing analysts.

MOSKOVSKY KOMSOMOLETS

- The growth of wholesale prices for petrol in Moscow over the last month will inevitably lead to a price hike for the fuel on the local market. Russia's oil producers prefer exporting oil to selling it to local consumers at the price monitored by the federal anti-monopoly watchdog, the daily says.

 

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Mon, 08/20/2012 - 07:42 | 2720075 lolmao500
lolmao500's picture

Bullish in South Africa...

http://www.wnd.com/2012/08/genocide-looms-for-white-farmers/

Genocide looms for white farmers

Last month, however, when Genocide Watch chief Gregory Stanton declared that white South African farmers were facing a genocidal onslaught and that communist forces were taking over the nation, virtually nobody noticed.

Few outside of South Africa paid attention either when, earlier this year, the president of South Africa began publicly singing songs advocating the murder of whites.

The silence is so deafening that Secretary of State Hillary Clinton didn’t even publicly mention the problems when she was there last week. Instead, she was busy dancing, pledging billions of dollars and praising the ruling government.

“I find that quite disturbing, as if Afrikaner lives do not count for the Obama administration,” Dan Roodt of the Pro-Afrikaans Action Group, PRAAG, told WND.

He says the situation is rapidly deteriorating.

Many more victims have been savagely tortured, raped, disemboweled, drowned in boiling water or worse. The horrifying evidence is available for the world to see on countless sites throughout the Internet: pictures of brutalized dead women and children – even babies.

When ANC Youth League boss Julius Malema began singing “Kill the Boer,” Genocide Watch moved up South Africa to stage six out of eight on the road to genocide – the preparation and planning. The seventh phase is extermination of the target group. The final stage is denial.

Mon, 08/20/2012 - 09:11 | 2720238 You Didn't Buil...
You Didn't Build That's picture

<<Russia's central bank has authorized commercial banks to monitor from Oct. 1 the export transactions of their clients as a measure to establish pathways of illegal capital outflow.>>

 

Who's gonna buy all those $4 million dollar apartments in NYC and Miami and Cali then?

Mon, 08/20/2012 - 07:47 | 2720079 Catullus
Catullus's picture

The tradegy is not the result.  The tradegy is the sequence of events.  You're living through the euro tradegy every day. 

The irony for those who understand economics is that the government can never truly decide what people will use as a medium of exchange.  Just as a government cannot centrally plan a language.  Money communicates value to people and how they choose to communicate that value to others is determined on what they're willing to exchange for the things that they have. 

Mon, 08/20/2012 - 08:04 | 2720099 Snidley Whipsnae
Snidley Whipsnae's picture

Catullus... I cannot totally agree with your comments.

"The irony for those who understand economics is that the government can never truly decide what people will use as a medium of exchange."

When the US Gov demands that 'all debts, public and private' be paid in FRNs the people have little choice but to comply. Of course, in the long run you are correct since the average life span of a fiat currency is ~ 40 years... but, 40 years is a life time in many countries.

In other news: China's PBoC advison Xia reccommends adding SILVER to China's PM reserves...

" PBoC advisor Xia recommends holding only USD 1,000bn in currency reserves, with the rest to be earmarked for strategic investments. He goes on to suggest a gradual increase in gold reserves and recommends pursuing a “buy the dip” strategy over an extended period of time. He also advises PBoC to add silver to the official reserves."

Hat tips to Max Keiser and ZH/TD...

http://maxkeiser.com/2012/08/20/we-expect-chinese-central-bank-continue-gradually-accumulating-gold-think-might-planning-gold-backing-renminbi/

Mon, 08/20/2012 - 08:46 | 2720171 Catullus
Catullus's picture

But the US does not rule the world.  If people around the world don't want to accept the dollar, they don't have to.  Same thing with the euro.  And besides, it's only a law.  People can choose to ignore a law.  Just like a lot of convience stores won't accept bills larger than $50.  They'll take your debit card bank notes being cleared electronically, but won't clear a transaction with a $50 bill.  You're free to advise the store clerk about the legal tender laws, not sure where that's going to get you. 

And spare me on Max Keiser.  The guy doesn't deserve a click-through until he starts appologizing to people like Gary North or Lew Rockwell.

Mon, 08/20/2012 - 10:05 | 2720372 Snidley Whipsnae
Snidley Whipsnae's picture

Keiser is funny at times and I need all the laughs I can get. Rockwell?... not so funny but I read him occasionally. Gary North? ... nah, but Chris Hedges might interest you. Hedges is agnostic, Harvard divinity education, fired from NY Times for telling the truth about Iraq, but he was a war correspondent for a long time and he knows the score in the Mid East... and a far better speaker and writer than Rockwell or North.

Mon, 08/20/2012 - 07:51 | 2720083 SWRichmond
SWRichmond's picture

Only 3 years behind the curve as usual: Moody’s warns on California city defaults

Yes, and only immediately after the media has had its circus flaying of Meredith Whitney for her "bad call."

Mon, 08/20/2012 - 08:17 | 2720111 dannyboy
dannyboy's picture

yeah i saw that.. 2008 timing could be the same again, august / sep they remove the rug with martial law drills all over the world planned for oct.

Mon, 08/20/2012 - 09:01 | 2720199 You Didn't Buil...
You Didn&#039;t Build That's picture

It's no wonder the Chinese are buying the only two hard assets they have access to: Gold and apartments. I read they have been ripped off so much by the Chinese counterparts of  Madhoffs and Corzines, they no longer trust anyone. This also expalins why their stock market has not re-Bubbled; they have no faith in the heavily manipulated stock market.  Unfortunately, the box buyers entering their market now at their highs may be in for a letdown ...and a loss.

Sat, 08/25/2012 - 09:12 | 2736618 JJSF
JJSF's picture

All this talk about the evil chinese police state check out Jim Puplava's interview with Lew Rockwell from yesterday.

The US domestically is going much further..

http://mlatrader.com/?p=31

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