Larry's Blog
Super Committee’s Failure Blamed for Falling Stock Prices Today
November 21, 2011
No deal was struck by the Super Committee on deficit reduction, as Republicans wouldn’t budge on their refusal to lift taxes and Democrats dug in their heels against gutting entitlement spending. Equity prices fell in response as they had during the summer deficit battles that resulted in S&P’s downgrading of America’s credit rating to AA+. […] More
New Overnight Developments Abroad - Daily Update
Debt Concerns Intensify
November 21, 2011
Investors began this week is a risk-off mood, fanned by An expected admission from the U.S. congressional super-committee of failure to strike a budget cutting deal, which will trigger automatic across-the-board reductions and a possible additional U.S. credit rating downgrade. A warning from NYU Professor Roubini that an Italian debt restructuring will be unavoidable. The […] More
Foreign Exchange Insights and Next Week
Next Week
November 18, 2011
Next week will be holiday-shortened, with Japan closed Wednesday for Labor Thanksgiving and the United States shut Thursday for Thanksgiving. Spanish voters are expected to elect a new Conservative government on November 20. The Federal Reserve, Bank of Japan and Bank of England will be publishing minutes from the prior meeting, and Turkey holds a […] More
Foreign Exchange Insights and Next Week
Thanksgiving Week 2011
November 18, 2011
Currency markets next week will be contending with the still unfolding euro debt crisis as well as the peculiarities of the U.S. Thanksgiving Holiday closure. During Europe’s crisis, which began its third year this month, conventional wisdom has felt that currency movement was only weakly related to national economic fundamentals and instead dominated by frequent […] More
New Overnight Developments Abroad - Daily Update
Europe Burning… and Draghi No Help
November 18, 2011
Although the dollar has given back some gains, stock markets in Asia and Europe tell the story of a euro debt crisis that’s still raging and threatening to drag the rest of the world down with it. The dollar fell overnight by 0.7% against the Swissie, 0.5% versus sterling, 0.4% relative to the euro, 0.3% […] More
Deeper Analysis
Dow Jones Industrial Average Hovering Near January 2000 Peak
November 17, 2011
U.S. equities experienced an incredible bull run from mid-August 1982 to mid-January 2000, with the Dow Jones Industrial Average advancing at a 16.9% per annum pace from 777 to a peak of 11,723. The index recorded sequential five-year averages of 3,244 in 1990-94, 7,358 in 1995-99, and 9,897 in 2000-04. At 11,742 at 20:00 GMT […] More
New Overnight Developments Abroad - Daily Update
Euro Debt Crisis Infecting Healthier Economies
November 17, 2011
Equities have fallen by a further 1.4% in France, 1.3% in Great Britain and 0.9% in Germany. Stocks slumped 1.9% in India, 1.0% in Singapore, 0.8% in Hong Kong and Malaysia, 0.6% in Singapore and 0.3% in China. Equities firmed 0.3% in Australia and 0.2% in Japan. German ten-year bund yields dipped another two basis […] More
Deeper Analysis
United States on a Data Roll
November 16, 2011
Since Friday, a string of better-than-expected U.S. economic indicators have been reported and, along with a solid Japanese 3Q GDP report, has presumably helped to mitigate market reaction to the bad news coming out of Europe. Enjoy the data roll now because it is unlikely to extend for long. Treasury-reported international capital flows were considerably […] More
Central Bank Watch
Bank of England Quarterly Inflation Report
November 16, 2011
The striking thing about today’s report is not that lower paths for growth and inflation are projected now than in the August Report but how much more bearish in the intervening three months. The forecasts assume unchanged monetary policy, that is a 0.5% Bank Rate and GBP 275 billion of quantitative easing versus the same […] More
Central Bank Watch
Bank of Japan
November 16, 2011
The Bank of Japan issued a more somber economic assessment, flagging near-term depressants due to slower global growth, the yen’s appreciation, and the flooding in Thailand. However, today’s statement, issued after the Policy Board had met over two days for a total of five hours and 50 minutes, left the policy settings as they’ve been. […] More
