It's starting to appear that the rest of the world is counting on the April 2 meeting in London as a last resort. Sort of like risking the house mortgage on one roll of the dice.
The IMF's latest bulletin warned: "Delays in implementing comprehensive polices to stabilise financial conditions would result in a further intensification of negative feedback... leading to an even longer and deeper recession". Stimulus packages would also need to be maintained in 2010, the IMF said.
The fund also issued a stark warning that the collapse of some national economies in central and eastern Europe could still trigger another wave of banking failures.
If you haven't seen this one yet from the Huffington Post, the article goes into shocking detail on how the U.S. Federal Reserve has been dumping money into foreign central banks:
The most recent balance sheet released by the Fed shows that $314 billion U.S. dollars are currently doled out to foreign central banks under the foreign exchange program. That's down from a December peak of nearly $600 billion, as central banks have repaid some of the loans.
In exchange for U.S. dollars, the Fed has received foreign currency of equivalent value in an exchange known as a swap. To protect the Fed from losses due to currency fluctuation, the deals include a provision that when the moneys are swapped back, the transaction will be done at the same exchange rate as the initial transaction.
U.S. companies are being advised to batten down the hatches for their annual meetings this year amid rising anger among investors and the public over bonuses, bailouts, layoffs and slumping share prices.
...
Protests were organized for Thursday outside offices of American International Group, Goldman Sachs, Wells Fargo and Bank of America across the country.
AIG employees have been getting death threats since a national furor erupted this week about more than $160 million in bonuses the troubled insurer recently paid.
This just makes me furious. There is no excuse for this.
A ranking member of the House Financial Services Committee has proposed legislation that would allow public pension funds to buy preferred stock from ailing U.S. banks, prompting apprehension from public pension plan trustees.
The legislation introduced by Rep. Gary Ackerman, D-N.Y., offers public pension funds a guaranteed rate of return in exchange for buying the preferred stock, or for loaning the government their money to loosen the credit freeze.
"By guaranteeing public employee pension fund investments in financial institutions, the federal government will use its balance sheet as a way to inject much needed funds into the nation's banking system rather than using more public money," the New York Democrat said.
The fact that this news is coming out the very next day after the Treasury announced that it would start printing money by the trillions is not a coincidence.
(Reuters) - A U.N. panel will next week recommend that the world ditch the dollar as its reserve currency in favor of a shared basket of currencies, a member of the panel said on Wednesday, adding to pressure on the dollar.
Galbraith conducts an introductory inquiry into the basic assumptions behind the economic policy responses of Team Obama, and warns that they fail to come to grips with the severity of the liquidity trap the entire world has now fallen into.
The deepest belief of the modern economist is that the economy is a self-stabilizing system. This means that, even if nothing is done, normal rates of employment and production will someday return. Practically all modern economists believe this. . . The difference between conservatives and liberals is over whether policy can usefully speed things up.
The blogs are simply ablaze over bonuses, who allowed it, finger pointing and outrage. To that effect, I thought putting the focus on a fairly detailed and informative Congressional hearing is in order.
Firstly one might read the Government Accountability Office testimony. It's quite a mixed bag and one must really be concerned in AIG taking years to rid itself of the London Financial unit, referred to as AIGFP. Later in the testimony, Liddy himself says this is the problem and it needs to be wound down quickly. Quickly is assuredly not years.
On Tuesday, March 18th, Senator Dodd gave a comletely different asnwer than the one he gave the day before. On Monday he said he had no idea how or why the key paragraph that limited Executive's bonuses to not more than $100,000 was removed from the TARP legislation.
Today, Tuesday, Senator Dodd had a miraculous revovery of his recollection as to what happened.
He said people from the Treasury Dept. were responsible for removing the key paragraph. When asked by Wolf Blitzer who from the Treasury Dept.had contacted him, Senator Dodd CONVENIENTLY said he didn't know who it was from Treasury and they had talked to his staff, but not him!!!!
i.e. Dodd stated it was his legislation but inferred that the paragraph that essentially gutted his legislation of any teeth had been removed by his staff without his knowledge and he had no idea who from Treasury had contacted his staff!
The Federal Reserve is coughing up yet another $1 trillion dollars to buy ....
As expected, the Fed kept its benchmark interest rate at virtually zero. But in a surprise, it dramatically increased the amount of money it will create out of thin air to thaw out the still-frozen credit markets that have cramped lending to consumers and businesses alike.
Indeed, the immediate effect on the bond markets was striking, with prices rising and yields dropping sharply on the news. The yield on the 30-year Treasury bond, about 3.75 percent before the announcement, fell quickly to 3.4 percent and remained volatile.
The action also gave a boost to stocks. The Dow Jones industrial average was down about 50 points before the 2:15 p.m. announcement, but within a half-hour it was up 80 points for the day.
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