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ECONOMICS – FINANCE – WORLD NEWS – GREEK DEBT

Eurozone recession here to stay, UK gets ready for exit

Yesterday…
David Cameron and his comrades of the Conservative Party published a policy draft for a referendum for a possible EU-exit of the UK. The draft says the referendum has to be completed by December 2017, given the Tories win the 2015 elections. I think the campaigning just began. read BBC

While the global “recovery” continues to force deficits to skyrocket and imports to slump, India has managed to become the outlier in the trend on Monday afternoon. Taking advantage of the low gold price, imports rose 138% since April 2012 to $7.5bn, or 18% of all imports, while the trade deficit hit 17.8bn. read Zerohedge

And of course the drama over Bloomberg‘s use of user data continued… read FT Alphaville

This morning…
there was a flood of data, with the German economy growing 0.1% from 4Q12 to the first quarter of 2013, undercutting the depressing estimate of 0.3% growth. The French economy contracted by 0.2% over the same period of time. read Bloomberg
Franco-German relations haven’t been great since Hollande got into office, but this morning’s result may just worsen the atmosphere of any policy discussion. The eurozone as such, contracted 0.2% in 1Q13. The recession continues…

Simultaneously, Mervyn “it’s-almost-his-last-day” King of the Bank of England raised the outlook for the UK economy [with lower inflation] and raised his eyebrows at eurozone performance, as well as the continental Financial Transaction Tax. read Guardian

Meanwhile, the US is preparing to become the model student again. The Congressional Budget Office is forecasting the deficit to fall as far as $378bn by 2015, much faster than anticipated. The 2013 forecast was cut by $203bn to an overall $642bn. read Reuters
And that is not all: Formerly the largest corporate debt market in the world, providing ample opportunity for the Michael Milken followers of the world to make money, China is going to take that spot within the next two years, according to S&P. Soon America will be debt and deficit free and flow with milk and vodka (we’re all grown-ups here). read Financial Times

In the kerfuffle over whether Jamie Dimon is allowed to stay in in his double-role as chairman and CEO of JPMorgan seems to be blowing over (much like Lloyd Blankfein expected), as fewer shareholders than expected are looking to back the leadership reform. Another bullet dodged for the industry. read Financial Times

And in case you’ve been in a good mood this morning, have a look at this: 10 Scenes from the ongoing global economic collapse (Zerohedge)

So long.

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T-1 month for Japanese election; $4.5bn settlement for BP

One election down, one to go: Japan is getting ready for December 16, when, rumor has it, the Liberal-Democratic Party will be re-elected over the incumbent Democratic Party of Japan. Over the past six years, Japan has elected a prime minister seven times. In between it was struck by disasters of all kinds. Shinzo Abe, leader of the liberal democrats, is determined to get the economy back on track, revisit US-Japanese relations and try not to go to war with China. Now there we have a reasonable approach to governing. Unfortunately, the world of money won’t have any of this. US hedge funds are increasingly betting against Japan’s corporate futuresays the Wall Street Journal, buying CDS’ for Sony, Panasonic, Nippon Paper Group and Kobe Steel.

In The Hague, Ante Gotovina and Mladen Markac have been released from prison after they had been charged with a 24 and 18 year prison sentence respectively for war crimes against ethnic Serbs during an offensive to retake Croatia’s Krajina region in 2011. read article

In the UK, some MPs have claimed that is is unlikely that £66bn poured into Lloyds and Royal Bank of Scotland will ever be recovered. Two weeks ago, Jim O’Neil, who is responsible for the two bank investments on behalf of the government, admitted that the purchase may not have been absolutely necessary at the time. This is angering all the anti-Keynesians who are chanting “we told you so”. Yet, the US Treasury managed to recover its bailout payments to AIG and actually sell the stake at a profit, maybe not all is lost. American public funds are going to be redirected towards the recovery of the housing marketsaid Bernanke yesterday. Today, the Federal Housing Administration reported that its insurance fund is running $16bn deficit for the year leading up to October. read article

Updating yesterday’s news of BP’s fine, the company has to pay $4.5bn in settlement charges. This includes an actual fine worth $1.256bn, the biggest penality of its kind in history. The Deepwater Horizon disaster let 4.9 million barrels of crude oil flow into the Gulf of Mexico. read article

Weekend reading:

– Lloyd Blankfein got America’s recovery all figured out, read article

– American oil and gas for everyone, read article

– Questions for and a defense of left-libertarianismread questionsread defense

– Making “fiscal history”: India’s tax reformread article

– reality HomelandPatraeus‘ affair, read article

Have a good one.

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