WELLINGTON: The current financial crisis is the worst the world has seen since the Great Depression of the 1930s and the US Federal Reserve move to cut interest rates will not make much difference, the Nobel Prize winning economist Joseph Stiglitz said on Wednesday.
"It will have some impact - it will do a little bit to stem the blood - but it's not addressing the fundamental problems underlying the collapse of the financial sector," Joseph said.
Stiglitz, who won the Nobel Prize in economics in 2001, is a former chief of the World Bank and chaired former US president Bill Clinton's council of economic advisers. He is in New Zealand on a lecture tour.
He said the Federal Reserve's move to cut its funds rate by three-quarters of a percentage point was "just trying to ease the economy down rather than try to address the underlying problems."
Stiglitz said the main problem was the fact that an estimated 2 million Americans were going to lose their homes because they could not repay mortgages which exceed the value of their property as house prices fell dramatically.
"As people walk away from their mortgages there will be more and more defaults - that undermines the whole financial system," he said.
If you are long gold remember this is an engineered sell of from central bankers and blue chip brokerage firms as seen in the commitment of traders report. the c.o.t. has the highest short position of all time (via bob chapman's radio show this week.)
Russian infectious disease specialists are reporting in the Kremlin today that the World Health Organization (WHO) is set to approve an ‘emergency measure’ mandating that all human beings on our planet have implanted within their bodies a newly invented microchip said to be able to prevent the deaths of over a billion people from the dreaded avian flu virus H5N1.
Prompting this horrific WHO actions, these reports continue, is Europe's top semiconductor maker, STMicroelectronics, announcement of its development of this new microchip, and as we can read as reported by the Reuters News Service, and as we can read:
Indonesia, the World’s largest Muslim Nation, however, and which the United Nations has stated is ‘losing the battle against the bird flu’, has accused the United States of using the avian flu virus to produce biological weapons, and as we can read as reported by China’s Xinhua News Service, and as we can read:
Russian Military Analysts further state in these reports that the United States, and its Western Allies, have long sought to microchip their population, indeed the entire World, to further their goal of establishing a New World Order through the establishment of a One World Government, and Religion, under their complete control.
But, these madmen in the West have been constantly thwarted in their efforts to have mass public acceptance for the microchiping of human beings by their Christian believers, and who say that such a scheme would introduce into our World their prophecies of the Anti-Christ, and who, according to these Christians, would seek to have all of humanity accept the Mark of the Beast.
The Christian’s prophetic book of Revelations says about this ‘mark’ that,"He also forced everyone, small and great, rich and poor, free and slave, to receive a mark on his right hand or on his forehead.", and further warns of ‘eternal destruction’ for any human being accepting it.
New York Gov. Eliot Spitzer announces his resignation Wednesday, March 12, 2008, in his offices in New York. An analysis by The Associated Press of a year's worth of expense reports for Spitzer's office and his 2010 campaign shows little sign that those funds were used to pay for illicit activities.
Almost four months before Gov. Eliot Spitzer resigned in a sex scandal, a lawyer for Republican political operative Roger Stone sent a letter to the FBI alleging that Spitzer ''used the services of high-priced call girls'' while in Florida.
The letter, dated Nov. 19, said Miami Beach resident Stone learned the information from ''a social contact in an adult-themed club.'' It offered one potentially identifying detail: the man in question hadn't taken off his calf-length black socks ``during the sex act.''
Stone, known for shutting down the 2000 presidential election recount effort in Miami-Dade County, is a longtime Spitzer nemesis whose political experience ranges from the Nixon White House to Al Sharpton's presidential campaign. His lawyer wrote the letter containing the call-girl allegations after FBI agents had asked to speak to Stone, though he says the FBI did not specify why he was contacted.
''Mr. Stone respectfully declines to meet with you at this time,'' the letter states, before going on to offer ''certain information'' about Spitzer.
''The governor has paid literally tens of thousands of dollars for these services. It is Mr. Stone's understanding that the governor paid not with credit cards or cash but through some pre-arranged transfer,'' the letter said.
''It is also my client's understanding from the same source that Governor Spitzer did not remove his mid-calf length black socks during the sex act. Perhaps you can use this detail to corroborate Mr. Stone's information,'' the letter said, signed by attorney Paul Rolf Jensen of Costa Mesa, Calif.
Gapping down in reaction to weak earnings/guidance: SMOD -13.1%, EGLS -11.4%, SHW -7.5%, MEG -4.8%, PALM -4.7%... M&A news: JPM -1.1% (several reports out that JPM may have to raise bid for BSC to $10/share)... Other news: MALL -13.9% (giving up some of Thursday's late surge), AYR -10.2% (decreases dividend to $0.25 from $0.70 last qtr), VRNM -8.0% (announced that its Form 10-K filed with the SEC on 3/17 included an audit opinion that contained a going concern qualification), TMA -7.1% (postpones pricing on $1 bln offering to Monday - DJ), CC -6.8% (activists circle Circuit City - WSJ), SRVY -2.1% (updates estimate for litigation-related expenses to $800K-$1 mln)... Analyst downgrades: SIGI -3.5% (downgraded to Neutral at BofA and downgraded to Market Perform at Raymond James ), HERO -3.2% (downgraded to Neutral at Capital One Southcoast), AUXL -2.6% (downgraded to Sell at Merriman), LEH -1.5% (downgraded to Mkt Perform at Oppenheimer), SMA -1.4% (downgraded to Mkt Perform at Wachovia), WFC -1.1% (downgraded to Underperform at Baird).
Gapping up in reaction to strong earnings/guidance: TIF +11.4%, CFSG +5.3% WAG +3.3%, ACMR +1.3%... M&A news: BSC +67.8% (several reports out that JPMorgan is in negotiations to raise Bear Stearns bid to $10/share)... Select Taiwan names showing strength after stocks gain 4% in Taiwan trading following presidential election: TWN +9.2%, SPIL +8.8% (also initiated with Buy at Standpoint), EWT +6.7%, TSM +6.1%, UMC +3.7%... Other news: FMT +81.8% (announces sale of mortgage servicing rights), CIT +16.6% (held conference after close on Thursday regarding liquidity actions; in talks with overseas banks - WSJ; upgraded to Buy at Stifel), MTEX +11.3% (reaches settlement in securities class-action lawsuit; admits no wrongdoing), CYTK +8.5% (announces positive results from an interim analysis of an ongoing Phase IIa clinical trial of CK-1827452 in patients with stable heart failure), XMSR +7.0% (FCC may be nearing Sirius-XM decision - WSJ), RATE +6.5% (mentioned positively in Barron's), IBN +5.7% (still checking), RAD +5.5% (up in sympathy with WAG), SIRI +5.2% (FCC may be nearing Sirius-XM decision - WSJ), STP +4.6% (signs 8-yr polysilicon supply agreement with DC Chemical), SEED +3.5% (updates genetically modified pipeline; phytase corn is expected to be commercially launched in 2009), VMW +2.3% (announces a multi-year initiative aimed at expanding its India-based research and development operations. Co will invest $100 mln in India by 2010), NUAN +2.1% (Samsung Electronics signs multi-year global agreement with Nuance Mobile; terms not disclosed), ORCL +2.0% (discloses in 8-k that it entered into a new $2 bln revolving credit agreement), PETD +2.0% (files form 10-K;accounting unchanged following resolution of SEC comment letter), BIDU +1.5% (announces the appointment of Jennifer Li as chief financial officer)... Analyst upgrades: PMCS +4.6% (upgraded to Overweight at Lehman), GW +3.4% (upgraded to Outperform at Credit Suisse), MON +3.2% (upgraded to Buy at UBS), RIO +2.8% (hearing added to Conviction Buy List at tier 1 firm), POT +2.8% (upgraded to Top Pick at RBC), FPL +2.3% (upgraded to Overweight at Lehman), CAM +1.2% (upgraded to Outperform at Wachovia), COL +1.0% (upgraded to Overweight at JPMorgan).
In overseas markets, shares in Taiwan paced Asian gains after a presidential vote there saw a China-leaning candidate swept into power in a landslide victory. Exporters in Japan fared well as the yen weakened somewhat against the U.S. dollar. See Asia Markets.
European markets were mostly shuttered for the Easter holiday
Perhaps the stickiest concern has to do with lawsuits, as Visa puts it, over the amount of money the credit-card companies charge merchants.
This has been a long-running feud. In preparation for an eventual settlement, Visa has put aside $3 billion of the $17.3 billion raised in the IPO to pay any possible claims. But (boilerplate alert!) the company acknowledges even that mightn't be enough.
But legal risks are only part of the story. When Visa states that its "operating results may suffer because of intense competition in the global payments industry," it isn't kidding. There are the usual competitors, but "the Achilles' heel," says David Robertson, publisher of the Nilson Report, a newsletter that tracks the credit-card industry, is that roughly half its revenue comes from the U.S.
The roll over of precious metals futures will be completed by the end of March as the April futures are rolled mainly into June to kick off the next rally. A very bullish opportunity lies here now that the large specs have temporarily cashed out. A requirement of physical delivery under futures contracts in gold and silver would at this point destroy the cartel and cause gold and silver to double or more. We keep hoping that the large specs will take us up on this theory, but they have their hands full of problems which we most certainly understand. Perhaps this surprise demand for delivery will be put off to June to absorb any IMF gold that comes up for sale, if any. We remain hopeful on this point, especially if a killing is made on the small resource stocks. What better to do with your profits than plow them back into physical gold and silver as the dollar is systematically destroyed by the Fed.
Once the bond markets implode due to rising interest rates as risk and inflation grow ever higher, all those trillions of dollars will be plowed into gold, silver and commodities and it will be "GAME OVER" for the cartel as the precious metals blast off on a space trip to the Einstein-DeSitter Radius at the outermost bounds of the visible universe. This event is not far off, and will be the greatest bear market in bonds of all time. Between rising rates due to hyperinflation and risk reassessment resulting from the subprime and credit-crunch debacles along with endless bailouts and nationalizations, dollar pegs broken by oil producers and flights by foreigners from dollar-denominated bonds and treasury securities, this event is baked into the cake.
