As QE2 Sets Sail, Bond Rally Sinks (WSJ)
For the third consecutive session, Treasury investors on Wednesday balked at buying new bonds at a large government-debt auction, sending prices lower and yields higher. The yield on the benchmark 10-year note reached 3.11%, its highest since May 25. Yields on the 10-year note have risen every day this week, adding about 0.24 percentage point since Friday and sparking speculation that the bull run in the bond market may have passed its peak.
Greece to Vote on Austerity Details (WSJ)
Greece’s parliament is expected to approve legislation implementing a crucial five-year austerity plan later Thursday, analysts said, one day after a closely fought parliamentary vote approved the overall outlines of the plan. A single roll-call vote on the implementing legislation is expected at around 1100 GMT, but with deputies also being allowed to express their support or dissent for individual articles in the legislation.
Institutions Pull Most From Prime Money Funds Since March 2010 on Greece (Bloomberg)
Institutions pulled out of U.S. prime money-market funds at the fastest pace in 15 months, shifting to funds that invest only in U.S. government-backed securities out of concern the European debt crisis would worsen.
Austerity Aside, E.U. Plans to Spend More (NYT)
With the European Union’s 27 nations facing years of austerity, and Greece nearly bankrupt, now might be a good time for the bloc to prepare to spend less. Instead, top E.U. officials went into battle Wednesday for an increase in spending under a seven-year funding plan worth about €1 trillion, or $1.4 trillion.
Moody’s: may cut US state ratings if sovereign downgrade (Reuters)
Moody’s on Wednesday warned it may downgrade the credit ratings of U.S. states and municipalities with strong credit links to the federal government in the event of a downgrade of U.S. sovereign ratings.
Chinese Largesse Supports Euro, But For How Long? (DJ Newswires via WSJ)
China’s secretive financial dealings and the FX market’s own opacity make exact figures for China’s affinity for euro-denominated assets hard to come by. Yet analysts point to official data showing that Chinese U.S. Treasurys holdings have fallen by at least $300 billion recently. Analysis of flows by Bank of America-Merrill Lynch shows that monetary authorities have been net sellers of dollars over the past four weeks, translating them into euros.
SEC Civil Action Against Ex-Goldman Director ‘Postponed Indefinitely’ (Law Blog)
A civil action against a former Goldman Sachs Group Inc. director who allegedly gave Galleon hedge fund founder Raj Rajaratnam inside tips about the investment bank has been “postponed indefinitely,” according to a notice posted by the Securities and Exchange Commission.
Summers Joins Andreessen Horowitz (DealBook)
Late Wednesday, Andreessen Horowitz, the venture capital firm led by the entrepreneur Marc Andreessen, announced that Mr. Summers was joining the team as a part-time special adviser. The announcement comes just one week after Square added Mr. Summers to its board of directors.
I.D. Could Get IMF Chief Off Rape Hook (Fox)
Dominique Strauss-Kahn’s lawyers could exploit a possible flaw in the identification procedure to get the former International Monetary Fund head off the hook for suspected rape, the French daily Liberation reported Thursday…She identified Strauss-Kahn in an identity parade the afternoon of May 15. But according to the disclosure form, the 32-year-old Guinean woman had already seen images of the silver-haired Frenchman twice beforehand.
Biography Gives Strauss-Kahn’s Allies a Forum (NYT)
Dominique Strauss-Kahn’s wife said she was “very worried” about the sexual-assault charges against her husband in New York, but predicted the couple would emerge from the ordeal “dignified and standing tall,” and with their marriage intact. The comments by the wife, Anne Sinclair, appear in a revised version of “Le Roman Vrai de Dominique Strauss-Kahn” (“The True Story of Dominique Strauss-Kahn”), which will be released in France on Thursday.
Justin Timberlake Takes Stake In Myspace (THR)
Justin Timberlake is taking a minority stake in MySpace after its acquisition by online advertising network Specific Media and will help the company develop its new strategy and creative direction. Under its new owner, which finalized an acquisition for $35 million on Wednesday, MySpace is expected to focus on music. Read more »