Wednesday, August 1, 2012

Wednesday roundup (08-01-12)


Confidence teetering in Eurozone, economists warn (The Los Angeles Times blogs)

What could the ECB do to save the euro?: The attention of world markets will be firmly fixed on the European Central Bank on Thursday, as it announces its monthly policy decision. (The Telegraph) ECB's Draghi faces leadership test over euro pledge (Reuters) Draghi Reshapes ECB Crisis Pragmatism As Trichet’s Dogma Fades (Bloomberg)

Europe's Dangerous Dream of Unlimited Money: This week, some euro-zone members have been calling for the permanent bailout fund to be provided with a banking license that would provide it with unlimited access to money from the European Central Bank. The "bazooka" option might help crisis countries in the short term, but it would entail massive risks in the long run. (Spiegel Online)

Euro-Zone Manufacturing Decline Steepens (The Wall Street Journal) Eurozone factory downturn worsens (EuroNews)



Bankers responsible for eurozone debt crisis (Press TV)



Pressure on Spain to bow to bail-out: Italy’s leader Mario Monti is to make a last-ditch effort tomorrow to persuade Spain to swallow its pride and accept a formal rescue, hoping to clear the way for double-barrelled action by bail-out funds and the European Central Bank. (The Telegraph)

IMF Chief Lagarde: EU Needs to Solve Spanish Bank-Bailout Question (The Wall Street Journal)

Spanish regions rebel against government deficit plans aimed at convincing investors (The Associated Press)

Spain faces tough debt auction [on Thursday] as ECB jitters grow (Reuters)

JOHN MAULDIN: FRANCE IS SCREWED, GERMANY WON'T HELP (Financial Advisor)

British factories hit by falling demand amid global meltdown for manufacturers (This is Money)

IMF: Downside Risks Cloud Japan's Economic Outlook (The Wall Street Journal)

Fed stands pat as economy 'decelerates' (CNNMoney) Fed says US economy has slowed, takes no new steps (The Associated Press) FOMC Statement: "Economic activity decelerated", Takes no action (Calculated Risk blog)

Economy may be permanently stuck in slow-growth mode (NBCNews)

Bernanke is Bluffing: Fed Powerless to Avert Recession (FoxBusiness) Central Bank Action Won’t Stop Global Slowdown: Pro (CNBC)

Manufacturing in U.S. Unexpectedly Contracted: Economy (Bloomberg) U.S. Manufacturing Sector Starting to Teeter? (Iacono Research)

Postal Service could run out of cash in October (CNNMoney)

Insurers seek softening of "too big to fail" criteria [regarding their own businesses] (Reuters)

Ludicrous Times Op-Ed Forgets Entire Year of Wall Street History (Rolling Stone blogs)

Hope for MF Global Clients: Bankruptcy Trustee [Louis J. Freeh] Tells Congress U.S. Customers 'Eventually Will Be Made Whole' (The Wall Street Journal) [Well, perhaps not quite WHOLE ...] MF Global Trustee Giddens: Customers Should Get 90% of Missing Funds (The Wall Street Journal)

Family Can't Move Into Their Home After Squatters File for Bankruptcy (ABCNews)

Drought Declaration Widened to Cover Half U.S. Counties (Bloomberg) Toll of drought widens as half of U.S. counties now disaster areas: While the nation's ongoing drought is expected to have some impact on food prices, the increases are months off. Meanwhile, the federal government is concentrating on helping beleaguered farmers and ranchers. (The Seattle Times) Drought: the 'new normal'?: On Wednesday, the U.S. Department of Agriculture reported half of the nation's counties have been declared disasters because of severe droughts that has affected the West, Midwest and Southeast. NBC's Anne Thompson reports. (NBC Nightly News)


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     The aim of this blog is to show (mostly from reports in mainstream respected news sources) that there is reason to believe that both the United States and the global economies remain fragile in the wake of the financial crisis of 2008 and that a number of threats that exist today could, if they worsened, bring about economic depression -- not just a minor depression, but a depression worse than the Great Depression. This blog further attempts to show that the financial crisis of 2008 was largely a result of the devastating consequences of excessive risk taking and the absence of effective regulation of such behavior. Furthermore, this blog maintains that not only have the lessons that should have been learned from this experience not been learned, but that the risks to the economy, including the persistent building up of "too big to fail" institutions, have actually increased since the crisis began. Finally this blog also brings to light, from time to time, reports of a parallel threat to economic well-being developing in the energy industry, which suggest that an energy shock may be coming much closer in time than is generally imagined. 

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