Fed throws euro banks a lifeline

It's Europe's crisis
John Bolton The recent riots in Athens, London and Rome signal rising insecurity and uncer tainty within the European Union. The most profound and widespread challenge is the growing sense that the EU's common currency, the Euro, may not survive in its present form, if at all. The obvious reason is that, as a matter of economics, the euro project gives surrealism a bad name: A currency without a government was always doomed to fail. Now, there are only two choices: 1) Abandon or dramatically ...

Hedge funds may skirt direct Fed scrutiny: source
WASHINGTON (Reuters) - The Federal Reserve does not believe any one Hedge Fund can topple the Financial System and therefore the private pools of capital may escape direct supervision by the Central Bank, an industry source familiar with the Fed's position said. The newly created Financial Stability Oversight Council, which includes the Treasury Secretary and 14 U.S. supervisors, including the Fed, are in the early stages of determining which non-bank firms pose a threat to the financial system....

Hedge funds may skirt direct Fed scrutiny: source
By Rachelle Younglai and Dave Clarke WASHINGTON | Mon Dec 20, 2010 3:00pm EST WASHINGTON (Reuters) - The Federal Reserve does not believe any one Hedge Fund can topple the Financial System and therefore the private pools of capital may escape direct supervision by the Central Bank, an industry source familiar with the Fed's position said. The newly created Financial Stability Oversight Council, which includes the Treasury Secretary and 14 U.S. supervisors, including the Fed, are in the early ...

Congressman Paul Says Fed Transparency Is His Goal
WASHINGTON (Reuters) - Republican Congressman Ron Paul, the new head of the subcommittee that oversees the Federal Reserve, said on Sunday he will seek greater transparency but will not be sending Subpoenas to the Central Bank chairman from Day One. Paul, a longtime critic of the Fed, will be the new chairman of the domestic Monetary Policy subcommittee of the House Financial Services Committee when the new Congress is seated in January. "Now that doesn't mean that the first week in January I...

US Fed extends dollar lifeline for central banks
The US Federal Reserve on Tuesday extended until August an emergency tool for other Central Banks to access US dollars, amid market jitters and high demand for the safe haven greenback. The deal, which had been due to expire in January, allows the Central Banks of Britain, Japan, Canada and Switzerland, as well as the European Central Bank, to exchange local currency for US dollars. The swap agreements were sealed in May, but as a Debt crisis and slow Economic Recovery continues to roil markets ...

Special Report: Inside AIG's Tortuous Turnaround
NEW YORK/WASHINGTON (Reuters) - During a rainstorm in Washington in early 2009, amid the furor over Wall Street's post-bailout bonuses, an American International Group employee pulled out an umbrella that had the insurer's name on it. "Somebody came by, grabbed the umbrella and broke it," said AIG Chief Executive Robert Benmosche, who added that the attacker told the employee to engage in a sexual act impossible to perform on oneself. The anger over AIG's $182.3 billion Taxpayer-funded bailou...

It's Europe's Crisis
The recent riots in Athens, London and Rome signal rising insecurity and uncertainty within the European Union. The most profound and widespread challenge is the growing sense that the EU's common currency, the Euro, may not survive in its present form, if at all. The obvious reason is that, as a matter of economics, the euro project gives surrealism a bad name: A currency without a government was always doomed to fail. Now, there are only two choices: 1) Abandon or dramatically shrink the...

Let's Not Save the Euro or, For That Matter, The European Union
I am no fan of the European Union. It is an artificial contraption, run by the corporate and bureaucratic elites of the continent, without democratic sanction because the various peoples subsumed under its rule themselves see that it is without democratic values or ambitions. Had it at least energized the economies of Europe there might be some raison d'être for its intrusive rules which wreak havoc with every member nation's culture and identity. The fact is, however, that t...

A Vote for Gold
Carney did not calm the nerves of Hans Merkelbach, investor, advisor, investor advocate, and watch dog of money manipulators, who wrote to the central Banker from his office on Bowen Island, British Columbia. After quoting the above, Merkelbach rebuked Carney: "Let’s get real! Would you explain to me why you, the ex-Goldman Sachs partner, besides having a warped idea of monetary matters, made such a ridiculous statement? The houses of cards are falling all around you, dear sir, but I ...

Extended Fed Currency Swaps Not Sign of Fresh Concern
By Michael S. Derby The Federal Reserve ’s extension of it currency swap arrangements with other major Central Bank reflects continued unease around the state of European Financial Markets. That said, the decision to maintain the swap lines with the Bank of Canada , Bank of England , the European Central Bank , the Bank of Japan and Swiss National Bank , should be viewed more as a protective action on the part of American officials. It is not, most Economists reckon, a sign that some new ...

Fed Extends Currency Swap Lines Over Eurobank Dollar Funding Concerns
The party line is everything is fine in bank land….even Eurobank land. But some recent developments suggest otherwise. The business news on Europe has pretty much daily updates on the unfolding and linked Sovereign Debt/ bank solvency crisis. The officialdom insists this looming problem can be resolved but most observers think it can’t be in the absence of a fiscal union, which is a political bridge too Far Right now. In a not-widely-noticed replay of pre-crisis conditions, the co...

Reserve Currency Roulette
Following up on our post from Friday, in which we illustrated the currency reserve and GDP market share of a number of different countries, a kind reader asked a question: “I wonder what percentage of the world’s foreign exchange reserves The Dollar had when it was redeemable among central banks in gold?” Our source for the graph, the IMF, only showed data going back to 1995, so we dug a little more and found the answer in a paper written by Barry Eichengreen of the University ...

WHO IS ALICIA MUNNELL? AND WHY IS SHE DRAWING FIRE?
Presidential nominations to the Federal Reserve Board are normally humdrum affairs. In fact, Congress hasn't rejected a central-bank nominee in more than eight decades. But this is the Clinton White House, which seems unable to fill any job easily. And that creates uncertainty for the Clintonites' expected choice for a Fed opening: Alicia H. Munnell. Munnell, Assistant Treasury Secretary for Economic Policy, hasn't yet been formally nominated to replace Governor John P. LaWare. But Senate Republ...

The economic outrage of 2010: Cowardly leaders failed to help working people
As we look back on 2010, the most significant economic event of the year was what didn't happen: Unemployment failed to come down, stubbornly hovering around 9.5% almost four years after the bubble broke, three years after the beginning of the Recession and more than two years after the collapse of Lehman Brothers. And, above and beyond any other reason, this stagnation persisted because our political leaders failed to muster the requisite courage to tackle our problems at their source. With o...

Special report: Inside AIG's tortuous turnaround
NEW YORK/WASHINGTON (Reuters) - During a rainstorm in Washington in early 2009, amid the furor over Wall Street's post-bailout bonuses, an American International Group employee pulled out an umbrella that had the insurer's name on it. "Somebody came by, grabbed the umbrella and broke it," said AIG Chief Executive Robert Benmosche, who added that the attacker told the employee to engage in a sexual act impossible to perform on oneself. The anger over AIG's $182.3 billion Taxpayer-funded Bailout w...

63382
When the financial world tries to anticipate the next meltdown, all eyes turn to Europe. Greece needed a Bailout, then Ireland did. Talk is that Spain will follow, though the country denies that it has a problem. ...

Mexican Banks Save Millions Using IBM Software
ARMONK, N.Y. and Mexico City, Dec. 22, 2010 /PRNewswire/ -- IBM (NYSE: IBM) today announced that Indeval, Mexico's central securities depository (CSD), is using IBM software to settle securities trades in seconds, reducing the risk of financial losses and shielding the country from fluctuating market conditions. Rapid trade settlement has reduced the amount of cash that banks must have on hand to cover trades by 52 percent and saved Mexican banks more than $240 million in interest in 18 months. ...

U.S. Stock Futures Advance on Earnings Forecasts, Retail Data
Dec. 21 (Bloomberg) -- U.S. stock futures rose, indicating the Standard & Poor’s 500 Index may advance for a fourth day, as earnings forecasts from Adobe Systems Inc. to Jabil Circuit Inc. beat analyst estimates and a gauge of Retail Sales accelerated. Adobe, the top maker of graphic-design programs, and Jabil Circuit, an electronics manufacturer, rallied more than 5.7 percent. Macy’s Inc. and Abercrombie & Fitch Co. gained after the International Council of Shopping Centers ...

Spain makes progress, but huge reforms vital: OECD
Spain has every chance of rising above its economic crisis if it enacts bold reforms, the OECD said on Monday, just as the government a Pension overhaul, the latest in steps over two weeks to regain market confidence. Spain, in the eye of Financial Markets which are shunning its Debt bonds, has done much right in fighting the crisis, but must reform its labour Legislation and employment practices, the Organisation for Economic Cooperation and Development said. The Economy, which stalled in the t...

Spain makes progress, but huge reforms vital: OECD
Spain has every chance of rising above its economic crisis if it enacts bold reforms, the OECD said on Monday, just as the government announced details of a Pension overhaul, the latest in a series of steps over two weeks to regain market confidence. Spain, in the eye of Financial Markets which are shunning its Debt bonds, has done much right in fighting the crisis, but must reform its labour Legislation and employment practices, the Organisation for Economic Cooperation and Development said. Th...

EUR/CHF Continues To Make Historic Lows On Euro Zone Tensions
The euro is slightly firmer today vs. The Dollar today, but continues to make new historic lows vs. Swiss franc just below 1.25, suggesting that euro zone tensions remain strong. EM currencies continue to firm, suggesting a bit of decoupling from the euro zone crisis. However, trading ranges are fairly narrow as we head into the holiday weekend. The ECB said will lend out EUR149.5 bln in 3-month loans, and that 270 banks bid for the money. Banks need to repay EUR96.9 bln in maturing 12-month l...

China's forex inflows slow in November but still high
The amount of foreign currency flowing into China slowed in November but was still the second highest monthly total in 2010, the government said on Monday, amid official efforts to contain Inflation. Beijing has expressed concern about the flood of overseas money into the world's second-largest economy which it fears is fuelling inflation and helping to push property prices out of the reach of most ordinary Chinese. The large flow of foreign currency -- partly driven by strong demand for Chinese...

Fed extends dollar lifeline for central banks
The Federal Reserve Building in Washington, DC. The US Federal Reserve on T... The US Federal Reserve on Tuesday extended until August an emergency tool for other Central Banks to access dollars, amid market jitters and high demand for the safe haven greenback. The deal, which had been due to expire in January, allows the Central Banks of Britain, Japan, Canada and Switzerland, as well as the European Central Bank, to exchange local currency for dollars. The swap agreements were sealed in May,...

China may try new ways to manage bank credit
Beijing | Tue Dec 21, 2010 8:58am EST Beijing (Reuters) - China's Central Bank is considering changing a key component of its Monetary Policy management by altering the way it manages bank credit, three sources close to the matter told Reuters on Tuesday. Under the proposed changes, the People's Bank of China (PBOC) may judge how much a bank can lend by looking at its capital adequacy ratio, Liquidity conditions and provisions for bad loans. That means the PBOC may set different deposit reser...

Sheriff: Banker probably killed himself
Published: Dec. 21, 2010 at 4:19 PM Mich. police seek missing bank executive MOUNT CLEMENS, Mich., Dec. 21 (UPI) -- A Detroit-area bank executive whose body was found after he had been missing for a month almost certainly took his own life, investigators say. David Widlak's family disputes the Macomb County Sheriff's finding of Suicide, The Detroit News reported. The family arranged for a private Autopsy by the Oakland County Medical Examiner and has hired a Law Firm to investigate the death. Wi...