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Breaking Up is Hard To Do

November 06, 2009
The financial crisis is usually dated as of mid 2007, but officials did not appear to coordinate an international response until Lehman’s failure sent shock waves through the global financial system a little more than a year later. And even then it seemed like officials acted in concert, like slashing interest rates rather than pursuing a coordina…
Breaking Up is Hard To Do Breaking Up is Hard To Do Reviewed by magonomics on November 06, 2009 Rating: 5
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Liquidity Ample--Music Playing, Risk On

November 05, 2009
This week's rash of central bank meetings have concluded. And the take away message is that the major central banks have not begun to remove the extraordinary liquidity provisions. And even in Australia, which hiked rates for the second time, seem to be signalling a gradual approach.
Liquidity Ample--Music Playing, Risk On Liquidity Ample--Music Playing, Risk On Reviewed by magonomics on November 05, 2009 Rating: 5
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New Initiative from Brazil?

November 05, 2009
Media reports are playing up local press stories that Brazil officials are evaluating additional measures to slow capital inflows which are driving the Brazilian real higher. The 2% tax may have led to some greater volatility in the currency, but net-net the currency remains firm. Other ideas being considered include the government selling a BRL d…
New Initiative from Brazil? New Initiative from Brazil? Reviewed by magonomics on November 05, 2009 Rating: 5
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More Thoughts on Brazil's 2% Transaction Tax

November 04, 2009
Investors continue to grapple with the 2% front-end tax BRL purchases for bond and equity investments. One might expect that the efficiency of the market is such that arbitrage will keep the ADR in line with what one would pay for the local shares. This does not seem to be the case, making the ADR a potentially viable alternative to the local shar…
More Thoughts on Brazil's 2% Transaction Tax More Thoughts on Brazil's 2% Transaction Tax Reviewed by magonomics on November 04, 2009 Rating: 5
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European Bond Update

November 04, 2009
There are three main stories to be aware of in the European bond market today.
First, Fitch cut its Irish bond rating of AA+ to AA-, citing widening fiscal shortfall and the rising cost of the financial support programs. S&P and Moody's had reduced Ireland's sovereign rating earlier this year, but the Fitch move puts its rating one not…
European Bond Update European Bond Update Reviewed by magonomics on November 04, 2009 Rating: 5
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New EC Forecasts--a bit more optimistic than the IMF

November 03, 2009
The European Commission released new forecasts earlier today that generally upgrade its outlook, the first time in two years. On Thursday the ECB staff will provide updated forecasts as well.
The EC now expects the euro zone economy to expand by 0.7% next year. Previously it though the region's economy would contract by 0.1%. The IMF is less s…
New EC Forecasts--a bit more optimistic than the IMF New EC Forecasts--a bit more optimistic than the IMF Reviewed by magonomics on November 03, 2009 Rating: 5
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Q4 US Borrowing Slashed

November 02, 2009
Late yesterday the US Treasury announced a dramatic cut in its anticipated borrowing requirements for this quarter. The net borrowing is expected to now be near $276 bln. This is down by almost half (43%) from the previous estimate of $486 bln.
Q4 US Borrowing Slashed Q4 US Borrowing Slashed Reviewed by magonomics on November 02, 2009 Rating: 5
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RBA Kicks Off Central Bank Meetings

November 02, 2009
The Reserve Bank of Australia is widely expected to hike rates early Tuesday. This would be the second move in the cycle. A Bloomberg survey found 18 of 22 expect a 25 bp hike while the remaining four expect a 50 bp move. We are inclined to be part of the majority here, believing that fragility of the global recovery and strength of the Australian…
RBA Kicks Off Central Bank Meetings RBA Kicks Off Central Bank Meetings Reviewed by magonomics on November 02, 2009 Rating: 5
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Iceland Scales Back Capital Controls

November 02, 2009
Effective today, Iceland lifted restrictions on capital outflows. New investors can now exchange their holdings for foreign currencies, provided the transactions are duly registered.
Iceland Scales Back Capital Controls Iceland Scales Back Capital Controls Reviewed by magonomics on November 02, 2009 Rating: 5
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