Author: Gregory White

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Freedom’s Overrated: Growing Number Of Germans Want Berlin Wall Put Back Up

Berlin Wall

16 percent of respondents to a 1001 person survey by German newspaper Bild have said that “nothing better could possibly happen” than the Berlin wall going back up.

Freedom wasn’t high on the agenda either side of the wall, with 28% of East German respondents saying it was a political priority, and 42% of West Germans agreeing, according to Bild.

Many of the survey’s respondents were also willing to sell their votes for 5000 euros ($6869), 1 in 7 East Germans and 1 in 12 West Germans.

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Moody’s Presents: Here’s How To Know When Your AAA-Sovereign Is Going bust

Sovereign debt scenarios are pointing towards doubt where the market has usually had the most confidence, namely U.S. and European debt.

But even though these countries have become increasingly difficult to rate, Moody’s points to scenarios where things could go bad, or much much worse.

And while some of the traditional powerhouses may suffer, the cleaned up Scandinavians may be the place to hide in low risk bonds.

See when various countries are at risk of going bust >

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Cost Of Extracting Canadian Tar Sands Oil Could Turn All Of Europe’s Cars Electric

Shale Oil

Canadian shale oil projects are being attacked over their cost inefficiency compared to what could be major environmentally positive energy investments, according to The Guardian.

The Albian Sands project, which will cost 250 billion pounds ($380 billion), will see Shell, Chevron, and Marathon benefit from the production of crude oil, which will eventually go to market.

Opponents are arguing that the money could better be used to fund a European wide electric car scheme and Saharan solar panels to turn Europe carbon-neutral.

But with 4 million barrels of oil a day set to be produced by this shale oil tar sands investment by 2025, pulling out seems unlikely for major oil manufacturers.

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What It Means That The UK Pound Is Directly Correlated To Election Polls

pound red UK

Following the UK election could make you a tidy bit of cash, if the Conservatives continue to drop in the polls.

The trend when Labour gains and the Conservatives lose in the polls is that the value of the pound drops, according to FT Alphaville.

Nomura is trying to convince everyone that the Conservatives are still going to win due to their leads in key swing districts. Markets this morning aren’t buying it after a new poll points to the Conservatives on a mere 4 point lead, according to FT Alphaville.

Currency traders might be pouring over polling data, as politics seem to actually matter again.

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Meet The 20 Emerging Markets Billionaires Wiping Americans Off The Map

Forbes released its infamous billionaire rankings this week, and it points to a trend away from America dominating the list to new countries making appearances.

In the economic version of an Olympic medal count, countries outside the U.S., EU, and BRIC states are finally making a showing.

Here we’ve profiled the top 20 billionaires from our MAVINS list, which includes Mexico, Australia, Indonesia, Nigeria, and South Africa. Unfortunately, Vietnam had no appearances.

Meet these 20 emerging market kingpins >

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March 12, 2010

China Faces Africa Resource Setback In Squabble Over Congo Copper Deal

One of China’s biggest African investments has hit the skids due to IMF dissent over the project, according to Asia Times Online.

The Congo copper deal, which was set to involve $9 billion in Chinese investment in infrastructure and mining projects, would have paid out returns to a China-Congo company called Sicomines.

This deal was meant to involve access to 10 million metric tons of copper, according to Bloomberg.

Beyond the IMF and the West’s displeasure, local corruption is also holding up the project.

China’s demand for copper may be dimming, but this certainly is not a positive for a regime seeking greater access to minerals.

Now Check Out How China’s African Investments Compare To Charity–>

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March 10, 2010

There Are 37 States On The Brink Of Unemployment Solvency

There are 37 states with the bare minimum in funds for unemployment outlays, this according to the Financial Report of the United States Government.

The Treasury Department assessment points to the 37 states with the ‘minimum solvency ratio’ of 1. Important to note, these numbers are as of September 30, 2009 and could have become much worse since.

Unemployment

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Here’s How Republicans Alone Are Directly Responsible For $7.3 Trillion In Unfunded Liabilities

Bush Medicare

With all the talk of the inefficiencies of current health care reform, Michael Panzner at Financial Armageddon, via Econbrowser, highlights a historical example of how such programs can go very, very wrong.

Medicare Part D, the expansion of the program to assist in the funding of prescription drugs, has now chalked up a present value deficit of $7.2 trillion, according to the Financial Report of the United States Government.

This is over a 75 year period of expenditures less revenues and could be extremely volatile based on the health conditions of the broader American public or changes in health care being discussed now.

It shows that health care reform, whomever is handling it, is extremely costly.

Medicare D Graph

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15 Reasons To Stop Complaining About Taxes

April 15th approaches and as tax season starts to heat up we all start steaming about the cash the government wants from us for living in the U.S.A.

But let’s just put something into perspective real quickly.

In other countries taxes are way higher.

And in fact, it’s only because our own taxes can go way higher that foreign bond investors haven’t totally freaked out yet about lending us so much money.

So without further ado.

See the 15 countries that will make you stop complaining about taxes >

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Goldman: Forget Pound Doom And Gloom, The UK Is In Much Better Shape Than You Think

london thames river 4x3

While the news on export weakening this morning is pushing the pound downward, Goldman’s Erik F. Nielsen is arguing that the UK is in much better shape for a rebound than continental Europe.

Nielsen says that the pound is likely to rise to $1.73 in half a years time, due to improving economic conditions for the country, while the Euro could be on parity with the dollar, according to Bloomberg.

The pound is certain to experience more short term volatility due to the uncertainty of the UK elections. A low exchange rate now will help the UK’s economic results in the coming months.

But the E.U., particularly Euro zone members, is one of the UK’s biggest trading partners. Low demand there could slow the UK’s real export recovery, which may also impact the pound.

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Hung Parliament Watch: New Poll Shows UK Conservatives Crumbling

Cameron Shame

The Conservatives have lost any sense of superiority in the run-up to the UK elections as Labour have narrowed the nationwide poll gap and taken a sizable lead in seats in Parliament.

The Daily Mail reports this morning that new poll numbers show Labour on 314 seats and the Conservatives on 259.

While that prevents Labour from getting the all important parliamentary majority, it does put them in lead of the hung parliament, and budget chaos, now predicted to result.

The Conservatives have been sputtering since late last year, but two important revelations have hit them this week. First, their chief campaign donor Lord Ashcroft was outed for a series of scrupulous off shore tax engagements. And just this morning, it has come to light that the wife of Conservative leader David Cameron has voted Labour in the past, for Tony Blair, and is considering doing so at the next election, according to The Daily Mail.

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March 7, 2010

Tanker Terror Alert In Crucial Shipping Lane The Straits Of Malacca

Preparations for terrorist attacks have increased in the Straits of Malacca as a result of intelligence suggesting plans for attacks on oil tankers are imminent, according to The Straits Times.

The Straits of Malacca are a key shipping route for goods in Asia, particularly oil, and this latest threat level increase has put Singapore, Malaysia, and Indonesia on a front footing.

There is concern that the threat of an attack could have an impact on trade in what is the world’s top container port, Singapore.

Is this the new Horn of Africa?

Malacca

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The Nightmare Scenario: How The U.S. Government Would Look Under An Austerity Budget

As lending to sovereigns dreis up, the world is talking about austerity budgets.

For now though, despite sky-high debts, the US can borrow at ease

But what would the United States look like under one?

The Irish have instituted a wide ranging austerity budget that has cut everywhere in order to bring the country’s debt as a percentage of GDP back into line with Euro requirements.

So let’s imagine for a moment…

Who would get killed in a US austerity budget >

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90% Of Public Health Workers Skip Work To Protest Budget Cuts In Portugal

Portugal

Government employees took to the streets of Lisbon today to protest the Portuguese government’s cuts in public sector wages.

According to a Correio da Manha translation, ninety percent of public health workers participated in the protest.

The government is attempting to freeze public wages in an effort to battle the country’s 9.3% deficit, which it much trim to 3% in order to get back into the Euro zone standards.

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Credit Suisse: UK Is The Winner For G7 Country Most Likely To Be In A Funding Crisis

london UK

Credit Suisse says Britain is the country most likely to experience a funding crisis this year in the G7, according to FT Alphaville.

The report highlights problems across developed nations and the usual debt perpetrators are there, including Greece, Ireland, and Spain, who all fall in front of the UK.

But the UK comes next, and FT Alphaville points out that Credit Suisse sees the British situation as particularly dangerous. From a hung parliament to high inflation, a series of problems are facing the UK which will make financing their debt difficult.

This might contribute to downward speculation on the Pound, but there have yet to be signs of that this morning.

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Proposed UK Budget Leaks And Points To Brutal Post-Election Slashing

axe hatchet cleaver knife meat

The Guardian has the scoop on what the UK austerity budget might look like and it calls for 11 billion pounds ($16.6 billion) in cuts.

The numbers coming from UK treasury officials point to senior civil service officials getting hammered 20%, marketing budgets getting crushed by 25%, and the National Health Service finding 10 billion pounds ($15 billion) in savings itself, according to The Guardian.

The leaked cut details may come as a result of increased pressure on the Labour Party leadership after the Pound’s plummet on March 1, even though Business Secretary Peter Mandelson blamed that on HSBC and the AIG – Prudential deal on March 3.

According to The Sun’s daily poll, Labour lost a point against the austere Conservatives in the last 24 hours.

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March 3, 2010

Citi: Yep, A UK Hung Parliament Is Coming

Citi is now calling for a hung parliament in the UK as a result of further poll tightening.

Analysts envision the election outcome halting progress towards an austerity budget, and impacting yields on government debt as a result.

This is similar to our previous analysis. The latest poll results, according to ICM on The Guardian, point towards a 7 point lead for the Conservatives.

CITI UK Elections

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March 3, 2010

This Is What Your Greek ‘Austerity’ Plan Looks Like

greece greek strike

Overnight, Greece announced a new plan set to bring the country in line with EU directives on its budget.

Government workers will have their vacation time pay cut 30% and their pensions frozen as a result of the new rules, according to the Times of London. Bonuses for government workers will also be impacted.

Nationwide increases to the value added tax, or VAT, will occur seeing taxes increase on all VAT eligible purchases to 21%. Alcohol and tobacco will see a tax rise of 20% and an 8 Euro cent increase on the gas tax will also be put in place. There will also be a luxury goods tax put in place, according to the Times of London.

This will all amount to $6.6 billion increase in revenue for the Greek government.

The Greek Communist Party, which received 7.5% of the vote in the last election, have called for massive protests in response, according to the FT.

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March 3, 2010

Citi Strategist: There Couldn’t Be More Of A Difference Between Chile And Greece

Geoffrey Dennis, Citi Global Emerging Markets Equity Strategist, was just on CNBC talking about the stark differences between Chile and Greece in their preparations for their respective crises.

At 1:00 – Chile is unique in that it has prepared for a rainy day, and has money on hand from copper sales to protect itself from its earthquake crisis.
At 2:55 – Greece is in the middle of a crisis its not economically prepared for with many neighbors in the same boat. It could lead to contagion, as many other Mediterranean states are in a similar predicament.