“It’s the reaction to the potential deflation that gets to the inflation,” Boockvar says. “The more deflationary type steps we see, the more money printing that will go on around the world that will set us up for that inflation. More deflation will eventually get us more inflation.”

Continue reading

Five days ago a great white hope appeared for the great bankrupt Golden State (Baa1/A-), in the form of $2 billion in GO bonds, which were supposed to be promptly syndicated via underwriters JPMorgan and Morgan Stanley. This would have been the first bond sale for California since November: a critical milestone as the state creeps ever closer to a full-on default. Unfortunately, the creeping just turned into a casual jog after Jane Wells (@janewells) just tweeted that California has cancelled its bond sale “after legislature fails to approve cash management flexibility bill [the] Treasurer said he needed to attract investors.”And seriously, did California think it would succeed where so many other high yield issuers have recently failed?

Continue reading

The United States has unveiled plans for its new $1 billion high-security embassy in London — the most expensive it has ever built.

The proposals were met with relief from both the present embassy’s Mayfair neighbours and the residents and developers of the Battersea wasteland where the vast crystalline cube, surrounded by a moat, will be built.

Continue reading

European banks need to roll over €1 trillion (£877bn) of debt over the next two years at a much higher cost and in direct competition with hungry sovereign states, according to a report by Morgan Stanley.

Continue reading

Jim Rogers has absolutely no faith in Britain’s credit. Prepare for a downgrade in the very near future:

Continue reading

Feb. 24 (Bloomberg) — China’s economic growth will plunge to as low as 2 percent following the collapse of a “debt- fueled bubble” within 10 years, sparking a regional recession, according to Harvard University Professor Kenneth Rogoff.

“You’re not going to go a decade without having a bump in the business cycle,” Rogoff, former chief economist at the International Monetary Fund, said in an interview in Tokyo yesterday. “We would learn just how important China is when that happens. It would cause a recession everywhere surrounding” the country, including Japan and South Korea, and be “horrible” for Latin American commodity exporters, he said.

Continue reading

In February 2009, Robert Prechter of Elliott Wave International predicted a market rally that would be “sharp and scary for anyone who is short.”

In recent months, Prechter returned to more familiar territory, declaring here in November the market was in a “topping area.”

A few weeks ago, the veteran market watcher told the Society of Technical Analysts in London that a “grand, super-cycle top” is at hand, The WSJ reported.

“What has happened is a complete change in psychology from extreme negativity [a year ago] to extreme optimism” heading into the market’s recent top in January, Prechter says.

Continue reading

Feb. 23 (Bloomberg) — Former Federal Reserve Chairman Alan Greenspan said the financial crisis was “by far” the worst in history and called the recovery from the global recession “extremely unbalanced.”

The world economy has undergone “by far the greatest financial crisis globally ever,” Greenspan said today in a speech to the Credit Union National Association’s Governmental Affairs Conference in Washington.

Continue reading

Someone has uploaded a PDF to a Google Group that is claimed to be the proposal for Internet copyright enforcement that the USA has put forward for ACTA, the secret copyright treaty whose seventh round of negotiations just concluded in Guadalajara, Mexico. This reads like it probably is genuine treaty language, and if it is the real US proposal, it is the first time that this material has ever been visible to the public. According to my source, the US proposal is the current version of the treaty as of the conclusion of the Mexico round.

Continue reading

A top Federal Reserve official warned Monday that even as the economy starts to grow again, employers are likely to continue squeezing more productivity out of workers rather than start hiring new ones, thereby prolonging the economic crisis for the millions of unemployed.

In remarks at the University of San Diego, Federal Reserve Bank of San Francisco President Janet Yellen said that rather than experiencing a “V-shaped recovery,” the economy will continue to be sluggish and won’t be operating at its full potential until 2013.

Continue reading