Central Banks Take Coordinated Action (WSJ)
he Fed, the Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank and the Swiss National Bank agreed to lower the pricing on the existing temporary U.S. dollar liquidity swap arrangements by 50 basis points. That takes the new rate down to the U.S. dollar overnight index swap, or OIS, rate plus 50 basis points, the Fed said. The pricing will be applied to all operations conducted from Dec. 5. The authorization of these swap arrangements has been extended to Feb. 1, 2013.
Europe Enters Critical Ten Days To Save Itself (Reuters)
"We are now entering the critical period of 10 days to complete and conclude the crisis response of the European Union," Economic and Monetary Affairs Commissioner Olli Rehn said on Wednesday as EU finance ministers met. Euro zone ministers agreed on Tuesday night on detailed plans to leverage the European Financial Stability Mechanism (EFSF), but could not say by how much because of rapidly worsening market conditions, prompting them to look to the IMF.
Economist: Developed World Facing 'Mission Impossible' (CNBC)
"The developed world is facing a policy paradox. It needs inflation to rid itself of debt but deflation to encourage firms to boost production and employment," Karen Ward, senior global economist at HSBC told CNBC Tuesday. The only way to achieve the best of both worlds would be through a decrease in real exchange rates in the developed economies, she said. "If we don't do this exchange rate adjustment we are looking at a very long period of stagnant growth, high unemployment and ongoing uncertainty," Ward warned.
Goldman Focuses On Funding Others (WSJ)
After getting burned by investments in its own hedge funds during the financial crisis, Goldman Sachs Group Inc. is turning to the less risky, but potentially less lucrative, business of providing start-up money to hedge-fund managers. The New York securities firm has raised $600 million from clients such as pension funds, wealthy families and large institutions for a new fund. It plans investments in eight to 10 new hedge funds, to get them up and running, according to people familiar with the matter. Each hedge fund can expect to receive between $75 million and $150 million from Goldman's fund, which is expected to raise about $1 billion in total. Investors will earn returns based on the hedge funds' success, topped off with a percentage of the hedge-fund managers' fees, said people familiar with the matter.
Police Move To Evict LA Occupy Movement (Reuters)
Police in riot gear closed in on anti-Wall Street activists in Los Angeles early on Wednesday, determined to enforce the mayor's order to evict protesters who have camped outside City Hall for the past eight weeks. Hundreds of Occupy LA activists, joined by supporters streaming into the area in a show of solidarity, crowded the lawn, sidewalks and streets around City Hall as hundreds of helmeted officers moved into the encampment. They were followed by a separate line of police in white biohazard suits. Live local television news footage showed police shoving a man to the ground and arresting him after he confronted a line of officers. Except for some initial minor scuffling, the crowd remained boisterous but peaceful. Police declared the crowd an "unlawful assembly" around 12:30 a.m. (0830 GMT) and ordered people to disperse within five minutes or face arrest. The announcement was met by boos from the crowd. The crowd grew steadily more raucous before police arrived with protesters chanting "Move your feet, Occupy the street!" Several demonstrators climbed into trees, and fireworks were set.
Miami's Federal Jail Overrun With Strippers Posing As Paralegals, Lawyers Say (Miami Times)
Multiple attorneys interviewed say the Federal Detention Center visitor rooms have been taken over by South American pole dancers posing as paralegals for wealthy drug lords inside. Lawyers hired by the accused narco dons allegedly list the scantily clad women as "legal assistants," and the FDC lets them in. Meanwhile, attorneys who refuse to go along risk losing their clients to lawyers with busty beauties on staff. "They take off their tops and let the guys touch them," veteran defense attorney Hugo Rodriguez says. "The majority of these young, very attractive women are noncitizens brought in exclusively for the purposes of visiting the FDC. Any lawyer can sign a form and designate a legal assistant. There is no way of verifying it. The process is being abused."
MF Global Customers Catching A Break (NYP)
James Giddens, the trustee in charge of cleaning up the mess in the wake of MF’s Oct. 31 bankruptcy, said yesterday that he’s seeking approval to return a whopping $2.1 billion to thousands of burned brokerage customers. If approved by the bankruptcy judge, the latest distribution plan will boost the return rate to 66 percent of customers’ money — up from a previous estimate of 60 percent. Included will be customers who tried to liquidate their accounts before MF’s bankruptcy only to be stuck with bum checks and annoying bank fees.
Businesses Plan For Possible End Of Euro (FT)
Some businesses with global reach say a euro break-up would be grim but manageable. “We have made a first rough analysis about the consequences of the discontinuation of the euro as the Portuguese currency,” said Jürgen Dieter Hoffmann, finance director at Volkswagen Autoeuropa, the German carmaker’s Portuguese arm. “The conclusion is that overall the impact would not be so negative to our company, as we are mainly an exporter and belong to a worldwide group.”
Facebook Reaches Privacy Settlement (WSJ)
Facebook Inc. agreed to a 20-year privacy settlement with the U.S. government that would require the company to ask users for permission before changing the way their personal information is released. The settlement, the strongest government rebuke yet to the social network, stems from changes Facebook made to its privacy settings in December 2009 to make aspects of users' profiles—such as name, picture, gender and friends list—public by default. In an aggressive complaint, the Federal Trade Commission charged that Facebook's changes threatened the "health and safety" of users, in part, by exposing "potentially sensitive affiliations" such as political views, sexual orientation or business relationships.
Ratings Firms Misread Signs Of Greek Woes (NYT)
In a stern pronouncement, Moody’s Investors Service this week warned of rising prospects for multiple defaults by countries in the euro zone and credit rating downgrades of nations across Europe if leaders should fail to resolve the spreading debt crisis. When it comes to Greece, critics say Moody’s should have been tougher a lot earlier. Until two years ago, the ratings agency took a relatively lax approach to growing signs of troubles in Greece, epicenter of the current crisis, even as the country plowed ahead with a borrowing binge that jeopardized its fiscal condition. Moody’s held off dropping its strong A rating of Greece’s bonds despite growing political turmoil and economic woes through 2009. Investor fears over Greece’s short-term financing needs were “misplaced,” Moody’s said in a report in early December 2009. Twenty days later, after a review, the agency downgraded the nation’s debt, the last of the major ratings agencies to do so.
Gold Producers Poised Like ‘Coiled Spring’ to Rally (Bloomberg)
Gold miners’ earnings per share and per-share cash flow reached the highest levels in at least nine years during the third quarter, according to data compiled by Bloomberg. ���When earnings are reported, the market will be all goggle-eyed about how much cash is flowing in to these companies and what their balance sheets look like,” said Bergtheil. You tend to get a response at that time.”
Ax Falls At Smaller Banks (WSJ)
Some of the worst is being felt at small and midsize banks, defined as having less than $10 billion in assets. In the third quarter, those financial institutions cut a net of 2,714 jobs.
Trump Hints At Another Presidential "Run" (NYDN)
The real estate mogul-turned-reality show star told CBS News that if the Republican party doesn't nominate "the right person" he might enter the race in May - as a third-party candidate. "Come May, when the Celebrity Apprentice is completed, my contract to NBC is completed, I'm a free agent, as the expression goes," he said. "I can make a decision. You know, obviously it would have to be as an independent."