(Reuters) - The dollar hovered around three-week highs against a basket of major currencies in Asia on Monday, having gained ground late last week after upbeat U.S. jobs data was seen lessening the chance of fresh stimulus from the Federal Reserve this week.
Sunday, March 11, 2012
Dollar holds gains in Asia
(Reuters) - The dollar hovered around three-week highs against a basket of major currencies in Asia on Monday, having gained ground late last week after upbeat U.S. jobs data was seen lessening the chance of fresh stimulus from the Federal Reserve this week.
Euro Zone Debt - Not All Toxic
Against what would appear to be insurmountable odds, and in the midst of a once-in-a-generation sovereign-debt debacle, the European corporate bond market is thriving. And according to industry experts, that is not at all surprising.
Greece Defaults - World Does Not End
So after all the weeks of angst and protest, Greece was able to restructure its debt. But it couldn't do so without imposing losses on unwilling creditors, and so late Friday the International Swaps and Derivatives Association declared that Greece had defaulted at last, triggering among other things credit default swaps on Greek debt. The world did not end. Credit default swaps (CDS) are a form of insurance against a bond defaulting. They are private contracts between private parties, even if the bond insured against is issued by a government.
Beware the Safety Catch for Bond Buyers - There Is No Perfect Hedge
There is no such thing as a perfect hedge. That is one lesson from Greece's debt exchange, even if the maneuver triggers a form of insurance meant to protect bondholders from losses.
An initial attempt by Greece to circumvent that insurance has raised lasting doubts about how effective it is for hedging sovereign debt. It turns out, though, that investors can't always count on credit default swaps for protection in even seemingly safe areas like U.S. corporate bonds.
India Ends Cotton Export Ban
India, the world’s second-biggest cotton producer, scrapped a one-week-old ban on exports of the fiber after protests from growers, traders and China, the nation’s largest customer. Prices dropped.
“Keeping in view the interests of the farmers, industry, trade, a balanced view has been considered by the Group of Ministers to roll back the ban,” Trade Minister Anand Sharma said in an e-mailed statement yesterday.
Turkish Banks Expand Lending
Turkish banks are winning the confidence of Italy’s biggest lender as it leads the nation’s first sale of asset-back securities known as covered bonds. UniCredit SpA’s Turkish joint venture is underwriting a program for Istanbul-based Sekerbank TAS (SKBNK) to raise 800 million liras ($448 million) through arranging the sale of securities backed by loans to small and medium-sized businesses in Turkey. UniCredit bought 117.6 million liras of the covered bonds to sell on to foreign lenders after underwriting the equivalent of 408 million liras of the same debt last year, Sekerbank said in a March 8 filing with the Istanbul Stock Exchange.
Coffee falls as record crop looms
NEW YORK/LONDON, March 9 (Reuters) - Arabica coffee futures on ICE Friday retreated toward the 16-month low set earlier this week as prospects of a record global crop in 2012/13 threw the market on the defensive. ICE cocoa extended the gains from its technically driven surge of Thursday, while sugar drifted lower in dull dealings.
Hedge Funds: A Day Late and a Dollar Short?
Hedge funds reduced bets on higher commodity prices for the first time in seven weeks after China cut its growth target, just as prices rallied on signs the U.S. economy is improving and Greece is containing its debt crisis. Money managers reduced combined bullish positions across 18 U.S. futures and options by 1.1 percent to 1.17 million contracts in the week ended March 6, Commodity Futures Trading Commission data show. Investors cut bets on copper by the most in two months and those on oil by the most since December. China uses more copper and energy than any other nation.
MF Global Rattles Traders' Cage
The closely knit futures industry has confronted scandals before, but the collapse of MF Global Holdings Ltd. still has seasoned brokers and exchange officials on edge. Confusion over what went wrong at MF Global and how it could have been prevented have prompted some of the world's biggest agricultural trading firms to consider dumping brokerage middlemen and bringing their business in-house, to avoid being caught up in another such debacle.
Currency Trading at $5 Trillion a Day
Currency trading may have risen to a record $5 trillion a day in September, surpassing the peak reached before Lehman Brothers (LEHMQ) Holdings Inc.’s collapse in 2008, according to the Bank for International Settlements. Trading then declined to about $4.7 billion a day in October and is likely to have fallen considerably in early 2012, the Basel, Switzerland-based bank said in a report. The BIS said it derived its estimates from supplementing the data in its foreign-exchange survey, which is undertaken every three years, with information collected from central banks and electronic- trading platforms.
Continued drought in West Texas could help Arkansas farmers
JONESBORO, Ark. - For the 2012 crop year, corn and cotton acreage in Arkansas may converge at the 600,000-acre mark, but from different directions, according to Scott Stiles of Jonesboro, Extension economist for the University of Arkansas System Division of Agriculture. "The recent National Cotton Council survey indicated that Arkansas' 2012 cotton acreage may dip to 619,000, down from 680,000 last year," Stiles told the University of Arkansas Extension service. "Questions remain as to how many corn acres we will gain in the state. Last year we had 560,000. The most recent high in corn acreage was 610,000 in 2007."
Goodbye Greece, Hello . . . Iceland?
Iceland will either adopt the euro after joining the European Union or drop the krona and unilaterally adopt another currency as “the situation can’t remain unchanged,” said Prime Minister Johanna Sigurdardottir. “The choice is between surrendering the sovereignty of Iceland in monetary policy by unilaterally adopting the currency of another country or become a member of the EU,” Sigurdardottir said in a speech delivered at a Social Democrat Alliance party convention today in Reykjavik, the capital. EU membership will allow Iceland to “cooperate with EU countries as a sovereign nation, which has a say in the decision and policy making in all fields of cooperation.”
The pros and cons of an all electronic cashless society
I was quite intrigued by the mobile money world Wolman advocates in his book “The End of Money: Counterfeiters, Preachers, Techies, Dreamers — and the Coming Cashless Society.”
Can a case be made for paying bonuses at MF Global? MF What?
The story has been making the rounds of various wire services and MF Global forums. Obviously and appropriately this is causing outrage by those involved with MF Global, particularly those that are still waiting for their money to be returned. The outrage is fair but we have seen this before with bankrupt firms like American Insurance Group (AIG). However, there is a more disturbing element to this. The decision on any bonuses received apparently will be made by MFGH trustee Louis Freeh. Freeh has been negotiating what information he will release to the various Federal investigators looking into the MF Global mess. It has always seemed odd to us that with an ongoing criminal investigation a government appointed trustee can determine what information he will release, particularly when you examine the different roles the two trustees are playing.
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