european union

Raising the Debt Ceiling

Filed in BP, Debt, euro, european union, Gold, GOld juniors, Gold Market, lead, o, obama, silver, stimulus, target by on January 21, 2011 0 Comments
Raising the Debt Ceiling

The United States government seems to enjoy spending our money with the zeal of a rap star. They like it so much, in fact, that they’re going to need a little more from you… Last week, Treasury Secretary Timothy Geithner warned Congress that this year’s statutory limit on federal debt will be reached as early as spring — between March 31st and May 16th. Geithner alerted congressional leaders saying: Even a very short-term or limited default would have catastrophic economic consequences that would last for decades. For these reasons, I am requesting that Congress act to increase the limit early this year, well before the threat of default becomes imminent. I don’t buy it. We’ve already been down this road before… Bush’s TARP and Obama’s Economic Stimulus effectively did the same thing. And look what happened: more than 90% of the money went right to the banks, where it still resides. Bush and Obama did their jobs. They protected the banks at all costs. And that was, of course, the design from the start. To bring confidence back into the U.S. system, we’re simply going to have to cut out the reckless spending. This would point America in the right direction and reduce the risk of a default or devaluation that looms in our near future. Unfortunately, this does not appear to be the road our politicians want to take. ~~SIGNUP_WD~~ The trouble with this train wreck of a debt picture is that rates are going to have to go higher in the near future. That’s because the folks who have been buying our debt over the course of the last 30 years are no longer interested in our new debt offerings at current interest rates. Not only are they not interested in buying our new debt; but they’ve decided to dump the Treasury paper they already have. This puts the U.S. in a tricky situation. To make our obsessive borrowing more attractive, we’ll have to continue to raise rates. This is where things really start to go south… And the whole of society could fail because of unsustainable spending and debt scenarios at every level of government worldwide. This was typical of every other empire our world has ever known before their ultimate collapse: the Spanish, Greek, Roman, and British Empires all came to an end because they spent themselves into oblivion— just as the European Union, England, Japan, and the U.S. are doing today. Just consider how truly desperate some situations have become… Last week, the state of Illinois increased personal income tax by 66% and corporate income tax by 45%. These increases are designed to address a $15 billion state budget deficit that lawmakers said was leading the state into insolvency. How long is it before we start seeing headlines that include “State Bankruptcy”? On its current path, the United States could not possibly meet all of its future obligations. And the end game could mean collapse. That means as an investor, you need to get your ducks in a row. The

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Weekend: Wall of Worry

Weekend: Wall of Worry

Welcome to the Wealth Daily Weekend Edition— our insights from the week in investing and links to our most-read Wealth Daily and sister publication articles. Before the bulls break out the champagne today, I would warn them not to get too far ahead of themselves. After all, euphoria is a dangerous emotion that can lead to big losses — in this market or in any other. What is crystal clear is that our problems are not only ongoing but persistent. Certain cans have been kicked, but they are still in the road. Fundamentally, the picture is as clear as mud, even though the bulls are ready to break out the party hats in 2011, insisting that the markets really will grow to the sky. If only it were so… Advertisement Gold’s “Louisiana Purchase” Not long ago, the world’s largest uranium giant practically gave away billions of dollars worth of gold to one small exploration company… for only $250,000! Before their next set of drill results are posted, find out how this rare opportunity could easily triple your money by September! Click Here For Your Free Report Now! Of course, we know otherwise.I’m firmly in the camp that believes a “new normal” has begun; it springs from economic necessity as the middle class digests a greater new reality. This brave new world will be focused more upon frugality than on frivolity. As unemployment persists, home prices continue to drop, and more wealth evaporates, consumers are more likely to try living within their means, no matter how hard that may be. As a result, without a steady up-tick in jobs or boost in income, a repeat of the consumption-bubble we just lived through simply isn’t going to happen. Nor can it be recreated — despite the fact that the Fed is trying its best to do just that. So, what we’re essentially left with is a classic case of a reluctance to borrow or consume.And that’s a big problem, since that’s what the lion share of the U.S. economy has been based on since 1982… We have too many cars, too many houses, and too many debt holders who can’t support it all. Sure, Ben Bernanke and friends are providing plenty of liquidity; but those mountains of dollars will have very little velocity when a nation of good-time Charlies suddenly decides to live within their means. As I’ve said before, you can lead a horse to water, but you can’t make him drink. That being said, I thought we would play …

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Intel (Nasdaq:INTC) Receives US Approval for McAfee (NYSE:MFE) Deal

Filed in euro, european union, Gold Bullion prices, Intel Corp, Mcafee, o, silver by on December 21, 2010 0 Comments

Intel Corp. (Nasdaq:INTC) has received approval from the U.S. Federal Trade Commission to go forward with its acquisition of McAfee Inc. (NYSE:MFE).Now Intel awaits a decision from the European Commission, which, as usual, appears to be holding up another business deal. The antitrust regulator for the European Union has said behind the scenes that they’re concerned over the deal, which implies a

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Irish Relief Fleeting as `Day of Reckoning’ Nears

Borrowing costs for Europe’s most indebted nations are at record highs as Ireland’s capitulation in accepting a bailout of its banking industry stokes concern that other countries also will have to seek aid. “It’s no longer taboo to speak about a restructuring,” said Johannes Jooste, a portfolio strategist at Bank of America Corp.’s Merrill Lynch Global Wealth Management (*at least their in good hands !) Irish Relief Fleeting as `Day of Reckoning’ Nears Borrowing costs for Europe’s most indebted nations are at record highs as Ireland’s capitulation in accepting a bailout of its banking industry stokes concern that other countries also will have to seek aid. The average yield for 10-year debt from Greece, Ireland, Portugal, Spain and Italy reached 7.57 percent today, a euro- era record. The average premium investors demand to hold those securities instead of German bunds widened to as much as 492 basis points, the highest level of 2010. The average cost of insuring against default by the five nations using credit- default swaps reached a record 517 basis points on Nov. 23. “It’s no longer taboo to speak about a restructuring,” said Johannes Jooste, a portfolio strategist at Bank of America Corp.’s Merrill Lynch Global Wealth Management in London, which oversees about $1.4 trillion for clients. “The fact that bond yields continue to rise and put pressure on countries that have to fund from the market makes investors less and less confident, and it’s bringing forward the day of reckoning.” The Nov. 22 relief rally after Irish Prime Minister Brian Cowen conceded that the nation needed financial support proved transient. Irish 10-year bond yields fell 4 basis points, before jumping 104 basis points as of 3:13 p.m. in London today, exceeding 9 percent for the first time since 1995. The euro’s respite was more fleeting; the bailout inspired a 0.8 percent gain for the currency before it slumped to …

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Investment Management Association Hedge Fund Directive

Filed in BP, euro, european union, Gold Investing, hedge-funds, o by on November 26, 2010 0 Comments

Investment Management Association Head of IMA Condemns EU Hedge Fund Directive The head of the Investment Management Association has come out, perhaps unsurprisingly, against the hedge fund directive passed by the European Union. IMA head Richard Sau…

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Citigroup (NYSE:C) Sees Greek, Irish, Portuguese Bonds Continuing to Fall

As risks increase for the sovereign debt of Greece, Ireland and Portugal, Citigroup (NYSE:C) says they see bonds in the countries continuing to fall, as the crisis grows.Citigroup said, “Ireland, Portugal and Greece have underperformed significantly, but we do not think by anywhere near far enough yet. There’s a long way further to go if the situation deteriorates.”The yield on Irish bonds rose

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Traders and Investors Selling the Euro

Traders and Investors Selling the Euro

Filed under: International Markets , Currency The eurozone sovereign debt crisis has bubbled to the surface again. This time Ireland is in the cross hairs. Ireland may need aid, primarily to bail out its banks. Ireland says it has enough cash to carry it through next summer, but the key concern is keeping Irish banks afloat during this crisis. So far, Ireland hasn’t requested financial aid from the European Union. This uncertainty has set off a selling spree in the euro. About two weeks ago the euro was trading at $1.42. Since the Irish crisis began the euro dropped to $1.35. Continue reading Traders and Investors Selling the Euro Traders and Investors Selling the Euro originally appeared on BloggingStocks on Tue, 16 Nov 2010 11:00:00 EST. Please see our terms for use of feeds . Read | Permalink | Email this | Comments

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