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Nation - Google News
Labour has secretly suspended 50 members for anti-Semitic and racist comments...
2 May 2016 at 3:01pm
Labour has secretly suspended 50 members for anti-Semitic and racist comments
Labour has secretly suspended 50 of its members over anti-Semitic and racist comments as officials struggle to cope with the crisis engulfing the party. Senior sources reveal that Labour's compliance unit has been swamped by the influx of hard-left ...
Labour suspends three councillors over alleged antisemitic remarksThe Guardian
The worst for Labour is yet to comeFinancial Times
Defiant Jeremy Corbyn weathers the storm saying I WILL NOT QUITMirror.co.uk
Daily Mail -BBC News -South Wales Guardian -Belfast Telegraph
all 1,092 news articles »
Ed Miliband joins rivals in EU exit environment warning - BBC News
2 May 2016 at 5:30am
Ed Miliband joins rivals in EU exit environment warning
Former Labour leader Ed Miliband has warned an EU exit would be bad for wildlife and the environment. Environment Secretary Liz Truss, Lib Dem ex-energy secretary Sir Ed Davey and Green Party MP Caroline Lucas also signed a declaration saying the ...
EU vote too important to be dominated by Tory politics, says ministerHITC
Ed Miliband in cross-party push to show Brexit will damage environmentSouth Wales Guardian
EU is central to tackling climate change, says Ed MilibandThe Guardian
Express.co.uk -BuzzFeed News
all 10 news articles »
Gerry Adams: Sinn Féin president apologises amid racist tweet claims - BBC News
2 May 2016 at 5:22am
Gerry Adams: Sinn Féin president apologises amid racist tweet claims
Sinn Féin president Gerry Adams has apologised for using the 'N-word' in a tweet comparing the plight of slaves in the United States to the treatment of Irish nationalists. The post on his Twitter account on Sunday night provoked an angry reaction on ...
Gerry Adams apologises for using N-word in tweetBelfast Telegraph
Adams comparing US slavery with nationalist plight 'overblown'Irish Times
Gerry Adams defends N-word tweetThe Guardian
Irish Independent -IrishCentral -MyWabashValley -The Sun
all 48 news articles »
ministers warn parents not to haul kids out of class in test protest - The Sun
2 May 2016 at 2:57pm
ministers warn parents not to haul kids out of class in test protest
MINISTERS have warned parents who take their children out of school for the nation's first ever pupils' strike tomorrow will harm their education. Tens of thousands of youngsters are expected to be kept away from classrooms in the revolt over seven ...
Thousands Support First School Kids' StrikeManx Radio
Thousands of parents will pull their children out of school tomorrow in 'strike' over SATs examsCornish Guardian
Parents threaten 'schoolchildren strike' over compulsory exams for six-year-oldsITV News
Worcester News -Bristol Post -ChronicleLive -Canterbury Times
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Brexit not enough to swing Scotland towards independence, says top pollster -...
2 May 2016 at 2:38pm
Brexit not enough to swing Scotland towards independence, says top pollster
Scotland being pulled out of the EU by the rest of the UK would not be enough to trigger a second independence referendum, according to the country's leading pollster. Professor John Curtice, of Strathclyde University, said opinion polls suggest a so ...
Five seats to watch out for on election nightSTV News
Clock ticking for Labour as new poll shows Tories could still nab second place in Scottish Parliament electionScottish Daily Record
Scottish voters set the stage for post-poll dramaFinancial Times
Telegraph.co.uk -The Independent -The National -BBC News
all 135 news articles »
Astrologer Jonathan Cainer dies - The Guardian
2 May 2016 at 2:07pm
Astrologer Jonathan Cainer dies
Jonathan Cainer 'was always adamant that astrologers should not look to predict the time of a person's demise'. Photograph: Channel 5. Press Association. Monday 2 May 2016 16.07 EDT. Share on Facebook · Share on Twitter · Share via Email · Share on ...
Astrologer Jonathan Cainer: Daily Mail horoscope writer diesBBC News
Daily Mail astrologer Jonathan Cainer dies from suspected heart attack aged 58Daily Mail
Jonathan Cainer dead aged 58 after suspected heart attackMirror.co.uk
International Business Times UK -Evening Standard -Digital Spy
all 11 news articles »
Armed robbery at BP petrol station in Bearsden - BBC News
2 May 2016 at 8:51am
Armed robbery at BP petrol station in Bearsden
An armed robber threatened a member of staff at a petrol station before making off with a three-figure sum of money. The man entered the BP station in Milngavie Road, Bearsden, at about 17:30 on Sunday and threatened the staff member with a weapon.
Police appeal for help from public for armed robbery at Hillfoot garageKirkintilloch Herald
Armed robbery probe after claw hammer-wielding thug holds up garage in Glasgow and steals cashScottish Daily Record
all 7 news articles »
New hopes for baby giant panda as Edinburgh Zoo's Tian Tian is artificially i...
2 May 2016 at 1:41pm
New hopes for baby giant panda as Edinburgh Zoo's Tian Tian is artificially inseminated again
Britain's only female giant panda has been artificially inseminated in the latest attempt to breed the UK's first cub. The procedure on Sunday night was the fourth time Tian Tian has been inseminated since she arrived at Edinburgh Zoo at the end of 2011.
Edinburgh Zoo giant panda artificially inseminatedBelfast Telegraph
Maybe this time? Edinburgh Zoo giant panda Tian Tian artificially inseminated AGAINScottish Daily Record
Edinburgh Zoo's giant panda Tian Tian artificially inseminatedEvening Standard
Edinburgh Evening News -The Sunday Post
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British couple attacked on Thai holiday give court statements - The Guardian
2 May 2016 at 10:33am
British couple attacked on Thai holiday give court statements
A British couple who were punched and kicked unconscious while on a family holiday in Thailand have recounted their ordeal for court officials, as government officials apologised to them. Rosemary Owen, 65, her husband Lewis, 68, and their son, also ...
British family attacked in Thailand recount assault in courtDaily Mail
'I still have nightmares' British gran beaten unconscious by Thai thugs talks about ordealExpress.co.uk
Elderly Brits beaten up vow to return to ThailandThe Nation
Telegraph.co.uk -WalesOnline -Metro -Mirror.co.uk
all 58 news articles »
Student RAF pilots who died when plane crashed in North Yorkshire are named -...
2 May 2016 at 12:56pm
Student RAF pilots who died when plane crashed in North Yorkshire are named
Two RAF student pilots who died when their light aircraft crashed in North Yorkshire have been named. Cameron James Forster, 21, from Sussex, and Ajvir Singh Sandhu, 25, from Essex, were killed when their aircraft plummeted to the ground some 15 miles ...
Two RAF pilots killed in north Yorkshire after attempting 'crash landing' in field namedMirror.co.uk
RAF station commander leads tributes to pilots killed in light aircraft crashBelfast Telegraph
Young pilots who died in North Yorkshire plane crash namedMetro
Scarborough Today -Evening Standard -Express.co.uk -Gazette & Herald
all 17 news articles »
Business News continually updated from thousands of sources around the net.
Deutsche Bank Said to Be Faulted by FCA Over Lax Client Vetting
2 May 2016 at 10:41am
U.K. regulators faulted Deutsche Bank AG in a March letter for "serious" lapses in efforts to thwart money laundering, capping a review that already prompted the firm to make changes, according to a person with knowledge of the matter. Examiners criticized the bank's ability to verify some clients' identities and goals, or ensure that it wasn't aiding organizations subject to international sanctions, the Financial Conduct Authority found in the March 2 letter sent to the firm, according to the person, who asked not to be identified discussing confidential communications.
Halliburton, Baker Hughes Abandon $28 Billion Merger Agreement
2 May 2016 at 6:22am
Halliburton Co. and Baker Hughes Inc. called off their $28 billion merger that faced stiff resistance from regulators in the U.S. and Europe over antitrust concerns.
Oil Bulls Bet the Waning U.S. Shale Boom Will Curb Global Glut
2 May 2016 at 2:04am
Money managers turned the most bullish since May as West Texas Intermediate crude climbed to a five-month high on optimism that falling U.S. production and rising fuel demand will trim the global glut. Investors shrugged off an inventory gain that left supplies at the highest since 1929.
Frontier Fund Wins With Vietnamese Dairy, Pakistani Cement Bets
1 May 2016 at 9:57pm
While investors dumped trillions of dollars in emerging-market assets in the past three years, a Dubai-based frontier fund went looking for stocks to buy in even more exotic destinations: Pakistan, Vietnam, Saudi Arabia and Egypt. The strategy has worked well for Duet Mena Ltd., a manager of private-equity and hedge funds.
Vodafone Said to Pick Banks for $3 Billion IPO of India Unit
1 May 2016 at 5:50pm
Vodafone Group Plc has chosen banks to arrange a listing of its India business, which could raise as much as $3 billion and become the nation's largest initial public offering, people with knowledge of the matter said. The Newbury, England-based company picked Bank of America Corp., Kotak Mahindra Bank Ltd. and UBS Group AG to lead the offering, which could take place in the next year, according to the people.
AIG Raises $1.25 Billion Selling PICC Stock Near Bottom of Range
1 May 2016 at 1:52pm
American International Group Inc. raised $1.25 billion selling shares of Chinese insurer PICC Property & Casualty Co. near the low end of a marketed range.
SEC Vacates Order Allowing Rattner to Work for Guggenheim
1 May 2016 at 5:57am
U.S. regulators have vacated a March order that allowed Steven Rattner to work on deals for the investment-banking unit at Guggenheim Partners. The Securities and Exchange Commission announced the voiding of its earlier decision in an announcement late Friday on its website.
Munger Warns of Danger Facing AmEx While Buffett Affirms Support
1 May 2016 at 1:55am
Warren Buffett and Charles Munger acknowledged that American Express Co.' s business model is under threat while affirming their decision to hold onto the credit-card lender's stock at their Berkshire Hathaway Inc. "Anybody in payments who's an established long-time player with an old method has more danger than used to exist," Munger, Berkshire's 92-year-old vice chairman, said Saturday at the company's annual shareholders meeting in Omaha, Nebraska.
Sharp to Post Annual Net Loss of 250 Billion Yen: Mainichi
30 Apr 2016 at 9:31pm
Japan's Sharp Corp. will post a net income loss of 250 billion yen for the year through March, according to the Mainichi newspaper. The company had previously said it expects a loss of 170 billion yen on an operating level.
Valeant CEO Michael Pearson Had Chance at $2.66 Billion Payday
30 Apr 2016 at 5:23pm
Michael Pearson got an unusually big incentive in January 2015 to boost the share price of Valeant Pharmaceuticals International Inc.: a potential payday of $2.66 billion. A grant the company disclosed for the first time Friday would have given the chief executive officer 2.25 million shares if Valeant reached at least $1,181.81 on three specific dates between October 2019 and April 2020.
Stemcentrx Said to Return Record $1.7 Billion for Founders Fund
30 Apr 2016 at 1:27pm
Founders Fund has had some successes, but the acquisition of Stemcentrx Inc. tops them all. With the cancer drug maker's sale to AbbVie Inc., the venture firm will get as much as $1.7 billion, said people familiar with the matter.
Standard Chartered Said to Probe Banker Expenses, Personal Loans
30 Apr 2016 at 9:24am
Standard Chartered Plc has been conducting a probe into its bankers' conduct, including cases of padding expense reports and improperly lending money to colleagues, people with knowledge of the matter said. The investigation led to the departure of several bankers in Dubai in the past six months, including at least three managing directors, after Standard Chartered found they personally lent money to other employees in violation of internal compliance rules, two of the people said, asking not to be identified as the information is private.
Did I Pay Too Much for That Airline Ticket?
30 Apr 2016 at 5:18am
Deciding exactly when to buy a plane ticket, and whether it's a "good" price when you do, has thrown up a cottage industry around consumer doubt. Just like in a casino, passengers suspect they are the players and airlines are the house.
Amundi Names Credit Agricole's Musca Chairman, Inflows Fall
30 Apr 2016 at 1:21am
Amundi SA, France's largest fund manager, said Xavier Musca will replace Jean-Paul Chifflet as chairman as the company reported net inflows of 13.8 billion euros in the first quarter. Musca is deputy chief executive officer of Credit Agricole SA, Amundi's largest shareholder.
Can a $24 Billion Hedge Fund Blow the Whistle? Citadel Thinks So
29 Apr 2016 at 9:07pm
A whistleblower typically brings to mind the image of a back-office worker or disgruntled former employee, not a titan of finance. But Ken Griffin's Citadel, the operator of a $24 billion hedge fund and a global trading arm, is shattering that mental picture.
BBC News - Business
The latest stories from the Business section of the BBC News web site.
Leicester 'can make £150m from PL title'
2 May 2016 at 3:03pm
Leicester City will see their revenues grow after winning the Premier League title for the first time, sports marketing experts say.
Bitcoin industry 'sceptical' of Satoshi
2 May 2016 at 12:06pm
Scepticism has greeted claims by Australian entrepreneur Craig Wright's claim to be the mysterious creator of the digital currency.
Ferrari on course 'for record year'
2 May 2016 at 2:04pm
Ferrari says it is on course for a record 2016 after posting a rise in profits and sales for the first three months of 2016.
BHS was 'crashed into a cliff'
2 May 2016 at 2:56am
Failed retailer BHS was 'crashed into a cliff', the chairman of the Business, Innovation and Skills Committee, Iain Wright, tells the BBC.
Yahoo chief's $55m severance package
2 May 2016 at 9:12am
Yahoo boss Marissa Mayer will get $54.9m (£37.4m) in severance pay if she loses her job when the troubled internet firm is sold.
Restaurant staff 'should keep their tips'
2 May 2016 at 4:00am
Waiting staff should receive their tips in full and it should be clearer to customers that gratuities are optional, the business secretary says.
Argos recalls Mamas & Papas car seats
2 May 2016 at 4:28am
High Street chain Argos is immediately recalling five Mamas & Papas car seat models, over safety fears.
High pay targeted by huge Norwegian fund
2 May 2016 at 4:45am
Norway's sovereign wealth fund, the biggest of its kind, plans to target excessive executive pay at the companies it invests in.
Election looms over Australia's budget
2 May 2016 at 9:38am
Australian Treasurer Scott Morrison's budget on Tuesday will double as an unofficial election campaign launch.
Trump accuses China of trade 'rape'
2 May 2016 at 3:44am
Republican Party front-runner Donald Trump steps up his criticism of China's trade policy, accusing it of "raping" the US.
Reckitt Benckiser says sorry for deaths
2 May 2016 at 9:23am
The head of a South Korean division of a UK company is slapped by an angry relative as he apologises for selling a disinfectant that killed about 100 people.
Leak 'shows risk of EU-US trade deal'
2 May 2016 at 5:57am
Leaked documents from EU-US trade talks reveal a risk to European standards, says Greenpeace - but EU officials strongly reject the claim.
Vimeo buys video streaming rival VHX
2 May 2016 at 6:00am
Vimeo will let video-makers set up their own subscription video streaming services similar to Amazon and Netflix, the firm announces.
Japanese shares tumble on strong yen
2 May 2016 at 12:50am
Japanese shares fall more than 3% at the start of trading as yen strength saps the shares in big exporters.
Puerto Rico set to default on debt
1 May 2016 at 5:36pm
Puerto Rico's governor says the territory will not make a debt repayment on Monday after a weekend of crunch talks to resolve the financial crisis end without a deal.
Financial services company news - FT.com
SoFi offers equity to tempt new partners
2 May 2016 at 12:02pm
Online lenders latest fundraising could reach nearly $1bn
Settlement clears Apollo Education buyout
2 May 2016 at 9:52am
Private equity group?s bid values online learning company at $1bn
Western Union: transferring you now
2 May 2016 at 11:31am
incumbent remittances king does not have fat margins for the challengers to devour
UK regulator was urged to act before BHS fall
2 May 2016 at 11:00am
Pension Protection Fund called for tough stance on scheme funding
Q&A: Has bitcoin creator been revealed?
2 May 2016 at 10:32am
The claims of Australian Craig Wright that he invented the digital currency
Upstart lender SoFi maintains its bravado
2 May 2016 at 5:00am
CEO Mike Cagney says bricks-and-mortar banks deserve to become extinct
Australian claims to be bitcoin creator
2 May 2016 at 2:06am
Craig Steven Wright says he is Satoshi Nakamoto, creator of the virtual currency
?The City?, by Tony Norfield
1 May 2016 at 11:35pm
Banking as seen from the belly of the beast
Norway?s oil fund to target executive pay
1 May 2016 at 11:49am
World?s largest investor starts to exert its $870bn influence
Buffett fizzes in defence of Cherry Coke
1 May 2016 at 9:31am
Berkshire Hathaway AGM largely steers clear of politics but still gathers big crowds in Omaha and online
Movers & shakers: May 2
1 May 2016 at 3:02am
MSCI has appointed Kathleen Winters as chief financial officer. She joins from Honeywell
Australia pension alights at King's Cross
1 May 2016 at 3:01am
?Cost-conscious? AustralianSuper questions value offered by private equity and hedge funds
US public pensions crisis looms large
1 May 2016 at 3:01am
Huge problem of underfunding of retirement plans is crippling many cities and states
Banks? self-serving fund sales must stop
1 May 2016 at 3:01am
It is time for regulators to investigate sales practices at banks, says Madison Marriage
Banks told to stop pushing own funds
1 May 2016 at 3:01am
Brussels moves to prevent large banks funnelling clients towards poorly performing in-house products
Business News - Markets reports and financial news from Sky
Sky business news provides up to the minute reports on markets, share prices and the world economy, alongside expert business commentary.
UK Firm's Exec Slapped During Deaths Apology
2 May 2016 at 9:17am
A boss from the firm behind Dettol is shouted down as he offers a "heartbreaking" apology for harm caused by one of its products.
Tips Should Go Straight To Staff, Says Govt
2 May 2016 at 12:34pm
Restaurants could soon be forced to hand over every penny in tips to their staff and stopped from adding service charges to bills.
Pregnant Women 'Face Rise In Work Discrimination'
1 May 2016 at 7:31pm
Citizens Advice sees a 25% increase in the number of working women seeking advice on pregnancy and maternity issues.
Green Summoned To Parliament Over BHS Collapse
30 Apr 2016 at 9:47pm
MPs ask Sir Philip Green to attend two committees about the sale of BHS and pensions after the chain went into administration.
Eurozone Recovers To Pre-Recession Level
29 Apr 2016 at 4:23am
The economy of the single currency bloc has finally recovered to levels last seen before the 2008 financial crisis, figures show.
Mobile Roaming Charges In EU Cut By Up To 75%
30 Apr 2016 at 12:37am
New fees try to end the "bill shock" consumers have experienced after using their phones abroad without knowing how much it costs.
Time Out Plots Another Kind Of London Listing
29 Apr 2016 at 9:49am
Time Out Group is to announce plans to raise £80m from a flotation on the London Stock Exchange, Sky News understands.
Construction 'Blacklist' Settlement Reached
29 Apr 2016 at 9:49am
A four-year fight for compensation is over for workers who claimed they were struggling to find work because of a blacklist.
More Than 100 City Bosses Back EU 'Leave' Vote
29 Apr 2016 at 9:27am
A letter from City grandees comes two months after Remain campaigners claimed support from FTSE chairmen and chief execs.
Butterkist Owner To Pass On The Popcorn
29 Apr 2016 at 5:19pm
Booming British demand for popcorn has prompted Butterkist's owner to put it on the market, Sky News understands.
Learn about the world of Forex
Loonie and Aussie Share Downward Bond
by Adam Kritzer
30 Jun 2011 at 9:15am
In yesterday’s post (Tide is Turning for the Aussie), I explained how a prevailing sense of uncertainty in the markets has manifested itself in the form of a declining Australian Dollar. With today’s post, I’d like to carry that argument forward to the Canadian Dollar.
Beyond this, both currencies are seen as attractive proxies for risk. Even though the chaos in the eurozone has very little actual connection to the Loonie and Aussie (which are fiscally sound, geographically distinct, and economically insulated from the crisis), the two currencies have recently taken their cues from political developments in Greece, of all things. Given the heightened sensitivity to risk that has arisen both from the sovereign debt crisis and global economic slowdown, it’s no surprise that investors have responded cautiously by unwinding bets on the Canadian dollar.
In the near-term, then, the prospects for further appreciation are not good. The currency’s rise was so solid in 2009-2010 that it now seems the forex markets may have gotten ahead of themselves. A pullback towards parity – and beyond – seems like the only realistic possibility. If/when the global economy stabilizes, central banks resume heightening, and risk appetite increases, you can be sure that the Loonie (and the Aussie) will pick up where they left off.Tide is Turning for the Aussie due to lower commodity prices, low interest ra...
by Adam Kritzer
29 Jun 2011 at 10:40am
“Australia is about to enter a boom that should last decades…The Australian dollar is unlikely to go back to where it was, and manufacturing will shrink in importance to the economy, perhaps even faster than it has been.” This, according to Martin Parkinson, Treasury Minister of Australia. While 30 years from now, Mr. Parkinson’s prognosis might probe to be accurate, I’m not so sure it applies to the period 3 months from now. Here’s why:
First of all, the putative economic boom that is taking place in Australia is being driven entirely by high commodity prices and surging production and exports. Since peaking at the end of April, commodity prices have fallen mightily. You can see from the chart above that there continues to exist a tight correlation between the AUD/USD and commodities prices. As commodities prices have fallen over the last two months, so has the Australian Dollar.
Finally, the mining sector directly accounts for only 8% of Australia’s economy, which means that only to a limited extent to high commodities prices contribute to the bottom line of Australian GDP. This notion is reinforced by the 1.2% economic contraction in the second quarter – the biggest decline in 20 years – and the fact that GDP is basically flat over the last three quarters. Many non-mining economic indicators are sagging, and the number of corporate bankruptcies is 10% higher than in 2010. In the end, then, the ebb and flow of Australia’s fortune depends less on commodities, and more on other sectors.
That’s because anecdotal reports suggest that the Australian Dollar remains a popular long currency for carry traders, funded by shorting the US Dollar, and to a lesser extent, Japanese Yen. Given that many of these carry trades are heavily leveraged, it wouldn’t take much to trigger a short squeeze and a rapid decline in the AUD/USD. For evidence of this phenomenon, one has to look no further back than May 2010, when the Aussie fell 10-15% in only three weeks.
Emerging Market Currencies Brace for Correction Due to Market Uncertainty and...
by Adam Kritzer
28 Jun 2011 at 2:42am
“It was the spring of hope, it was the winter of despair,” begins Charles Dickens’ The Tale of Two Cities. In 2011, the winter of despair was followed by the spring of uncertainty. Due to the earthquake/tsunami in Japan, the continued tribulations of Greece, rising commodity prices, and growing concern over the global economic recovery, volatility in the forex markets has risen, and investors are unclear as to how to proceed. For now at least, they are responding by dumping emerging market currencies.
There are a couple of factors that are driving this ebbing of sentiment. First of all, risk appetite is waning. Over the last couple months, every flareup in the eurozone debt crisis coincided with a sell-off in emerging markets. According to the Wall Street Journal, “Central and eastern European currencies that are seen as being most vulnerable to financial turmoil in the euro zone have underperformed.” Economies further afield, such as Turkey and Russia, have also experienced weakness in their respective currencies. Some analysts believe that because emerging economies are generally more fiscally sound than their fundamental counterparts, that they are inherently less risky. Unfortunately, while this proposition makes theoretical sense, you can be assured that a default by a member of the eurozone will trigger a mass exodus into safe havens – NOT into emerging markets.
NO QE3: What are the Implications for the Dollar?
by Adam Kritzer
25 Jun 2011 at 7:28am
The verdict is nearly in; there will be no QE3. The second round of quantitative easing (?QE2?) will expire at the end of this month, and while it will not be unwound for quite some time, the Fed has indicated that it will not be followed by yet another round. The question on the minds of forex traders, of course, is what does this mean for the Dollar?
In his most recent press conference, Ben Bernanke, himself, indicated that QE3 was unlikely. According to a survey conducted by Bloomberg News, the majority of FX analysts (65%) believe him. Simply, the circumstances don?t support further easing. To be sure, the unemployment rate remains high, and the economy is teetering on the verge of double-dip recession. However, the last two rounds did little to address either of these problems, and companies have hoarded cash rather than investing in new plant and workers.
Interest rates are still hovering around record lows, and there isn?t anything to be gained from trying to lower them further. Besides, given that inflation is now above 3% ? due to an explosion in good and energy prices ? QE3 would simply be too risky. Economist Ken Goldstein summarized the situation as follows: “We will come to the end of QE2 and largely we mark about how little happened when it ended and that?s also an argument about why there may not be persuasive argument to do a QE3.”
On the other hand, there are some analysts who think that QE3 is inevitable (29%). PIMCO?s Bill Gross, manager of the world?s biggest bond fund, recently indicated that, ?Next Jackson Hole in August will likely hint at QE3/interest rate caps.? (Personally, I think that he?s probably just bitter that his forecast of a decline in Treasury Bond prices hasn?t materialized). One columnist wrote that the Fed?s arm will be twisted by the ongoing collapse of the housing market, while others have argued that the recent decline in the S&P 500 will spur the Fed into action. Most of us, however, believe that the Fed will adopt a wait-and-see approach before ultimately conceding that more easing is necessary.
For now at least, then, the prevailing assumption is that there will not be a QE3. As for how forex markets have digested this news, they have taken it in stride. The Dollar is now holding its value, and as I wrote in a previous post, it may even have bottomed out. Of course, it doesn?t hurt that the Euro is being punished by another flare-up in the sovereign debt crisis and investors are getting nervous about bubbles in emerging market currencies, all of which provide support for the dollar.
The fact that QE2 will soon end without having triggered financial apocalypse or hyperinflation ? as some cassandras initially predicted ? is something that is worth nothing. Of course, the proceeds of QE1 and QE2 will be recycled indefinitely into the markets, and forex investors can?t completely put quantitative easing behind them. Still, that there won’t be any more additional cash injected into commodities markets and emerging economy asset markets means that one of the main sources of downward pressure on the dollar has been eliminated.
Ironically, it is possible that the unveiling of QE3 could actually cause the dollar to rally. The reason is that there is still a tremendous amount of uncertainty in the markets, which provides the dollar with some safe haven demand. If the Fed were to concede that all is not well on the economic front and respond by more money printing, it could drive some safe haven flows into the US, even to the extent that it would overwhelm outflows driven by concerns over inflation.
Personally, I think the dollar will continue to hold its value, and perhaps even appreciate slightly in the near-term, as forex markets dither over the way forward.http://www.forexblog.org/2011/06/has-the-us-dollar-hit-bottom.html Swiss Franc is the Only Safe Haven Currency. The Franc is Starting to Distanc...
by Adam Kritzer
23 Jun 2011 at 10:11am
According to conventional market wisdom, there are three safe haven currencies: the Swiss Franc, Japanese Yen, and US Dollar. It is to these currencies that investors flock whenever there is a crisis, or merely an outbreak of uncertainty, and for much of the period following the collapse of Lehman Brothers, the three were closely correlated. As you can see from the chart below, however, one of these currencies has begun to distinguish itself from the other two, leading some to argue that there is now only one true safe haven currency: the Swiss Franc.
Ironically, the only thing that makes investors nervous about the franc is that it has already risen so much. Remember when it reached the milestone of parity against the dollar in 2010? Since then, it has appreciated by an additional 20%, and seems to breach a new record on an almost weekly basis. The same goes for the CHF/EUR and CHF/JPY. The President of Switzerland’s export association is expecting further gains: “Parity is a realistic scenario. Given the indebtedness of the eurozone and the strong attraction of the franc, the euro is likely to continue to lose value.”
The main variable in the Swiss Franc is the Swiss National Bank (SNB). Having booked a loss of CHF 20 Billion from failed intervention in 2010, the SNB is not in a position to make the same mistake again. In fact, SNB President Philipp Hildebrand has not even stooped to verbal intervention this time around, undoubtedly cognizant of the fact that he has very little credibility in forex markets.
At the same time, the SNB is not in any hurry to raise interest rates, lest it stoke further speculative interest in the Franc. Its June meeting came and went without any indication of when it might tighten. Interest rate futures currently reflect an expectation that the first rate hike won’t come until March 2012. Thus, the downside of holding the Franc is that it will continue to pay a negative real interest rate. The only upside, then, is the possibility of further appreciation. Fortunately, the SNB is unlikely to stop the Franc from rising, since it serves the same monetary end as higher interest rates. In other words, a more valuable Franc serves as a direct check on inflation because it lowers the cost of commodity imports and should (eventually) soften demand for Swiss exports.
It is possible that the Swiss Franc will suffer a correction at some point, if only because it rose by such a large margin in such a short period of time. On the other hand, given that its economy has proved its ability to withstand the Franc’s appreciation, it’s no wonder that investors continue to bet on its rise.Is it Possible to Trade Forex Part-time?
by Adam Kritzer
22 Jun 2011 at 10:17am
This week, I came across an article in the San Francisco Gate (which, incidentally, has really ramped up its forex coverage over the last year) that addressed this very topic. Given that part-time forex traders probably outnumber those that practice the craft full-time, such an article was long overdue.
In sum, the author advises part-time traders to concentrate their trading during the busiest times of the day, or failing that, to simply trade the most active currency pairs during the period of the day that one happens to have time to trade. For example, if you wish to trade the USD/EUR but only have a limited amount of time to do so, you are advised to trade the opening of the New York and/or London sessions, at 8AM EST and 3AM EST, respectively. Alternatively, if you only have time to trade from midnight to 2am, for example, you are advised to trade currency pairs in which the quote currency is the Yen, because during that time the Tokyo session is “in full swing.”
If you read the Forex Blog with any regularity and are ware that my bend is towards fundamental analysis, it’s probably already obvious to you that I don’t think this is necessarily the case. Consider that forex is a zero-sum game. In other words, on average, 50% of traders win and 50% lose. [When you account for trading costs (i.e. spreads), its probably closer to 30% win and 70% lose, but let’s ignore this for the sake of argument]. Thus, the way I see it, a trader that enters the market during the busiest times has the same chance of winning (~50%) as a different trader that enters the market during the least busy time of day. Either way you cut it, someone has to win and someone has to lose, and no amount of liquidity or volatility can rectify this situation.
Thus, my advice for part-time traders is to forget trading altogether. If you don’t have the time to constantly monitor the market, pore over charts, and develop technical strategy, the odds of winning are pretty low. On the other hand, why not shift your focus from trading to investing? Trading is difficult under the best of circumstances and even more difficult when you don’t have enough time to make a real commitment.
This way, you also don’t have to worry about carefully planning your entry and exit into positions. Entering a swing trade with a targeted profit of 500pips is probably just as good at 4am as it is at 7am, all else being equal. While this doesn’t necessarily increase the odds of success (above 50%), at least it gives you a great deal more flexibility in being a part-time trader.Japanese Yen In "No Man's Land." When will the BOJ Intervene to stop its rise?
by Adam Kritzer
20 Jun 2011 at 8:52am
This, according to a hedge fund manager that has decided to cancel all of his fund’s bearish bets on the Japanese Yen. The reason: the yen is rising, and it’s unclear when – or even if – the government will intervene to push it back down. Even though the yen’s strength is fundamentally illogical, it seems that investors are growing increasingly wary of betting against it.
Japanese government analysis has indeed confirmed that “speculators” are behind the strong yen, as the alleged wide-scale repatriation of yen by Japanese insurance companies has yet to materialize. Of course, there isn’t really much doubt: Japan’s economy is contracting, due to decrease in output spurred by the tsunami. In May, it recorded its second largest monthly trade deficit ever.
Meanwhile, interest rates and bond yields are pathetically low, and the Bank of Japan is being urged to expand its asset buying program, which would theoretically result in a devaluation of the yen. As a result, retail Japanese forex traders (nicknamed “Mrs. Watanabes“) have resumed shorting the Yen as part of a carry trade strategy.
Alas, speculators either don’t share their pessimism or are running out of patience. While everyone continues to assume that the BOJ will intervene if the Yen rises to 80 against the dollar, no one can be sure whether the line in the sand might not be 78 or even 75. At this point, intervention seems to hinge more on politics than on economics, which means predicting it is beyond the scope of this post. In other words, “There is too much uncertainty and volatility in markets right now to make that yen trade appealing.” And sure enough, the most recent Commitments of Traders data shows that speculators have been re-building their yen long positions over the last month.
I’m personally still bearish on the yen, but I also think it’s too risky to short it against the dollar, which seems to be declining for its own reasons. As you can see from the chart below, the yen has fallen against virtually every other major currency. Yen shorters, then, might be wise to avoid the dollar altogether and focus instead on any number of other currencies.
http://www.bloomberg.com/news/2011-06-17/japan-recovery-means-boj-can-avoid-adding-stimulus-muto-says.html Forex Volatility Continues Rising. What are the Implications for the Euro?
by Adam Kritzer
17 Jun 2011 at 9:38am
This week witnessed another flareup in the eurozone sovereign debt crisis. As a result, volatility in the EUR/USD pair surged, by some measures to a record high. Even though the Euro rallied yesterday and today, this suggests that investors remain nervous, and that going forward, the euro could embark on a steep decline.
For specific volatility measurements, there is no better source of data than Mataf.net (whose founder, Arnaud Jeulin, I interviewed only last month). Here, you can find data on more than 30 currency pairs, charted across multiple time periods. You can see for the EUR/USD pair in particular that volatility is now at the highest point in 2011 and is closing in on a two-year high.
What does all of this mean? In a nutshell, it shows that panic is rising in the forex markets. Last month, I used this notion as a basis for arguing that the dollar safe-haven trade will make a come-back. This would still seem to be the case, and should also benefit the Swiss Franc, which is nearing an all-time high against the euro. Naturally, it also implies that forex investors remain extremely concerned about a continued decline in the euro, and are rushing to hedge their exposure and/or close out long positions altogether.
Mataf.net suggests that this could make the EUR/USD an interesting pair to trade, since large swings in either direction will necessarily create opportunities for traders. While I have no opinion on such indiscriminate trading [I prefer to make directional bets based on fundamentals], I must nonetheless acknowledge the logic of such a strategy.http://www.forexblog.org/2011/05/interview-with-arnaud-jeulin-of-mataf-net-try-a-lot-of-strategies.html Euro Nears Breaking Point
by Adam Kritzer
16 Jun 2011 at 8:33am
It’s deja vu all over again in the forex markets as another twist in the sovereign debt crisis has sent the euro tumbling by the greatest margin in nearly a year. It was only last month that I posted “The Euro (Still) has a Greek Problem,” and yet, forex markets are once again reacting to the possibility of a Greek default as thought it were a new development. At the very least, investors finally seem to be acknowledging the inevitable.
There have been several factors at work in this latest episode. On Monday, S&P downgraded its credit rating for Greece to CCC, following on a similar move by Moody’s. That means that Greece’s sovereign credit rating is now the lowest in the world, behind such eminent economies as Grenada and Ecuador. While the move was hardly noteworthy in itself, it represents one more straw on the camel’s back.
Greece’s government is increasingly unstable, and Prime Minister George Papandreou has become so desperate that he has suggested forming an alliance with Greece’s most powerful opposition party. Meanwhile, violent riots outside Greek Parliament have reportedly become a daily occurrence, as the Greek populace has proven unwilling to accept wage cuts and tax increases.
As if that weren’t enough, there is tremendous uncertainty surrounding the next stage of the Greek bailout. No one can agree on what amount to give and what should be stipulated in return. Some parties think that private investors should be involved in the bailout by taking a “haircut” on the bonds that they own. Some members of the eurozone are balking about contributing any funds at all, wary of justifying it to their own citizens and that it is merely forestalling the inevitable.
I think the NYTimes offered the best summary: “Funding fatigue is growing in the north European creditor countries, especially Germany, the Netherlands, Finland and Austria, just as austerity fatigue is mounting in Greece.” When you consider that Greek interest rates and credit default swap spreads have surged to record highs, it seems that default is really inevitable. If the IMF and European Union are so determined, they can push off default until 2013. Still, default now or default then is still default.
At this point, then, the only real question is what happens when Greece defaults. Will it be forced to leave the Eurozone? Will that push the rest of the Eurozone fringe closer towards default? Will the Euro collapse and cease to exist as a currency? What will happen then?
Unfortunately, I think the answer to all of these questions is yes. At the very least, Greece will be forced out of the eurozone. Bondholders will push interest rates in Ireland, Spain, and Portugal up to double-digit levels, trapping them in the same cycle in which Greece is currently ensnared. Given the exposure of French and German banks to the sovereign debt of financially troubled eurozone members, they will also require state bailouts, and so on.
In a recent op-ed published in The Financial Times, celebrity economies Nouriel Roubini argued that the only way to avoid a complete eurozone meltdown is if the euro depreciates rapidly “to restore competitiveness to the periphery” or if the European Union is able to rapidly achieve complete fiscal and economic union. Roubini argues that the former is difficult because of the ECB’s hawkishness, while the latter is precluded by political hurdles that remain too formidable to overcome.
As Greece inches ever closer to default, the markets will increasingly become gripped by utter uncertainty over the questions that I posed above. Central Banks will stop accumulating euro-denominated assets, and investment funds will similarly shun Europe. (In fact, there is already evidence that this is happening). While European interest rates are attractive relative to the rest of the G4, they are hardly enough to compensate investors for this uncertainty. And when the markets come to terms with this, the euro might finally reach its breaking point.S&P 500 Decouples from Euro?
by Adam Kritzer
14 Jun 2011 at 9:58am
While I have written quite about forex correlations in recent posts, the focus has primarily been on correlations that exist between currencies. In this post, I would like to address a correlation that exists between currencies and other forex markets- specifically the relationship between the Euro and US stocks.
Why is this the case? In a nutshell, it is because the Euro – especially relative to the dollar – is a proxy for risk appetite. The same is necessarily true for US stocks. When investors are confident in the strength of the global economic recovery and the possibility of crisis is distant, the euro will rise. This has nothing to do with fundamentals in Europe, which are probably at least as bad as they are in the US. Of course, it may be connected with dollar weakness, since it is arguably the case that quantitative easing has both depressed the dollar and buoyed US stocks.
As I intimated in the title of this post, however, the S&P recently decoupled from the euro. Since the beginning of June, US equities have declined sharply, to the extent that they have given back most of their gains in the year-to-date. The EUR/USD, meanwhile, continued rising all the way until last week. While this has happened on a couple previous occasions, this was perhaps the sharpest break between the two.
I’m personally at a loss to explain why this happened. It has been conjectured that the driving force behind the correlation is algorithmic trading, and that hence, it must also represent the source of the break. In other words, high-frequency traders – which account for an ever-increasing proportion of forex volume – tweaked their trading algorithms so as not to buy the S&P 500 when the EURUSD rises, and vice versa.
It’s probably also the case that S&P 500 was falling for endogenous reasons- specifically a decline in GDP growth and earnings expectations which need not necessarily reflect itself in a stronger euro. In fact, in a normal functioning market, you would expect an inverse correlation; strong US economic fundamentals should translate into both a strong dollar and rising stocks. Could it be that worsening fundamentals are manifesting themselves in the form of a weak dollar and weak stocks?
Alas, the correlation has re-established itself over the last week, which means this is largely a moot issue. At the very least, it’s still worth being aware of, both insofar as it remains intact and in the event that it breaks down again.
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