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ECONOMICS – FINANCE – WORLD NEWS – GREEK DEBT

(Black) Friday, #25

Today is Black Friday, the Friday after Thanksgiving, which marks the begin of the serious Christmas business for the retail sector. In the United States, retailers are expected to meet sales of $700m, but that’s only half the story. For the coming Monday, also called Cyber Monday, sales estimates go up to $1.2bn. I’m sure Amazon is enjoying the holidays. see graph

Angela Merkel, Nicholas Sarkozy and Mario Monti met ahead of the next EU summit on 9 December (which will discuss treaty amendments concerning national budgets) to talk crisis. Unfortunately, they did not come up with a plan on how to save the euro. Germany and France are particularly disagreeing about the course of action the European Central Bank should take. France, recently backed by the Netherlands, is in favor of the ECB as a lender of last resort. This role, assumed by the Bank of England and the Federal Reserve, allows a [central] bank to buy unlimited amounts of debt from the debtor in question, lowers interest rates and, in turn, increases inflation. Ze Germans don’t like the idea, but many, like Paul Krugman, think it’s about time. Meanwhile, Italian 5 and 10-year bond yields are well above the 7% again, but not to worry, Monti wants to balance the budget in a year’s time. read article

Moody’s downgraded Hungary to junk-status Ba1 (in case you’re getting confused between Ba1 and BB+, they mean the same, there are just two systems in place). Hungary got €20bn from the EU and IMF in 2008, when the country couldn’t pay its debts the last time. Now, the worries are that the Hungarians won’t be able to make the debt repayments of €4.7bn that are due next year. Just for comparison, Hungary’s sovereign debt is at 81.3% of GDP (stats of 2010), which is 1% and 2% lower than France and Germany respectively. However, Hungary’s GDP of $130.42bn is only 3.9% of Germany’s GDP of $3.31tn. You get the drill. read article

But America is distracted by far more important things, namely Obama’s mentioning (or lack thereof) of God in his Thanksgiving speechread article

And finally, something to play around with: the World Bank does climate change (‘does’, not ’causes’), an interactive graphic that shows you things like historical rainfall rates in Uganda and finally settles the debate whether the Netherlands or England have more annual precipitation. see infographic

Have a good weekend people, and don’t forget to go out and spend that money..

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