IMF head in shock fiscal warning

The intensifying credit crunch is so severe that lower interest rates alone will not be enough “to get out of the turmoil we are in”, Dominique Strauss-Kahn, the managing director of the International Monetary Fund, warned at the weekend. In a dramatic volte face for an international body that as recently as the autumn called […]

Home sales, prices continue to fall

NEW YORK – Sales of existing homes, depressed by turmoil in credit markets, fell for a sixth straight month in August, pushing activity to the lowest point in five years an industry trade group said Tuesday. A separate report showed that t he nationwide decline in home prices accelerated in July, posting the steepest drop […]

From Prime to Subprime, America’s Home-Mortgage Meltdown Has Just Begun

by Eric Englund Inflation is an immoral tax that leads to immoral values ~ Anonymous South American banker Having been in the credit profession for the past 23 years, I have observed several cycles involving the loosening and then the inevitable tightening of credit-underwriting standards. Of course, the Federal Reserve stands at the epicenter of […]

Black day for shares as €4.5bn lost

By Brian O’Mahony, Chief Business Correspondent ON a black day for Irish shares a total of €4.5 billion was wiped off the value of the Irish Stock Exchange yesterday. Market sentiment was certainly not helped by fears that investors in one of Britain’s biggest mortgage lenders, Northern Rock, might lose their life’s savings as the […]

Investor panic takes toll on Speirs Group

Palmerston North-based loss-making finance company Speirs Group says its investor roll has plummeted 35% in the past three months, its secured stock funding has reduced and it is grappling with the collapse of its rental car client. Speirs Group, made up of Speirs Finance, Speirs Nutritionals and Spiers Foods, posted a loss of $1.9 million […]

Rising Energy Costs Could Affect BHP Billiton, Rio Tinto Share Prices

Posted by Dan Denning on May 25th, 2007 Finding the lowest-cost producer is becoming increasingly important in the mining industry. Prices for base metals are high. Some of this comes from supply/demand dynamics. And some is the result of inflation (a deteriorating U.S. dollar.) Either way, the price signals in the resource market are telling […]

Investors to blame for not assessing the risks

The United States is not the only nation confronting a household debt crisis. We, too, have a subprime lending market and it is managed by our collective bag of finance companies. The collective sum of savings at risk in this sector is reported to be $16 billion. Put another way, that’s nearly a third of […]

Failing banks, toxic bonds and mortgage laundering

The Triumph of Structured Finance By Mike Whitney  The entire global financial structure is becoming uncontrollable in crucial ways that its nominal leaders never expected, and instability is its hallmark. The scope and operation of international financial markets, their “architecture”, as establishment experts describe it, has evolved haphazardly and its regulation is inefficient — indeed, […]

Greenspan on 60 Minutes: It was all Bush’s fault

By Mike Whitney 09/17/07 “ICH” — – Alan Greenspan’s appearance on 60 Minutes was preceded with all the pomp and ceremony of a royal wedding. The public relations blitz dragged out for a whole week. What profound truisms would the elusive former-fed master divulge to the News Magazine’s withered-coquette, Leslie Stahl? Would he produce his […]

Greenspan: era of low inflation is over

Graeme Wearden and Ashley Seager Monday September 17, 2007 Guardian Unlimited Photograph: AP   Britain faces the prospect of falling house prices and rising inflation within a few years, according to Alan Greenspan, the former chairman of the Federal Reserve.In a series of interviews to promote his memoirs, the respected US economist warned that the […]

Cullen planned $1 billion in tax cuts

The Government planned to deliver $1 billion in personal tax cuts at the last budget, but shelved the plan due to fears it would fuel inflation, official papers show. The papers, issued under the Official Information Act, show the Government last year considered a package of personal tax cuts that would have equalled the $1 […]

Fed to meet for US rate decision

The Federal Reserve is preparing to meet to decide whether US interest rates should be reduced from 5.25%. Most analysts believe the Fed will cut rates to try and prevent a housing market downturn and the credit crunch from severely denting the economy. By making money cheaper to borrow, people would spend and invest more, […]

Families feel pinch as basic costs rise

By PAUL EASTON – The Dominion Post | Tuesday, 18 September 2007AdvertisementHouseholds are being squeezed by price increases on basic foods and petrol, even before higher power prices and a sliding Kiwi dollar begin to take effect. Budgeting agencies fear the increase in staple food prices, including butter’s 23 per cent increase yesterday and milk’s […]

Credit crisis: Meltdown!

In the past 100 years, the rollercoaster ride that is the world of high finance has seen some spectacular lows. Sean O’Grady looks back at four episodes that not only came to define their times but also served as lessons for the future Published: 15 September 2007 1907: The Bankers’ Panic Sometimes, all that is necessary […]

House prices surge ahead of pay

The cost of buying a home has blown out to a record high. In August it took 81.6 per cent of a median weekly income to pay the mortgage on a median-priced house. That is more than twice the amount considered affordable, according to the latest Fairfax Media home loan affordability report. That makes the […]

Bank of England in dramatic intervention

 Northern Rock forced to seek emergency funding · Savers are assured that their money is secure Ashley Seager Friday September 14, 2007 The Guardian The Bank of England was last night forced to hand emergency funding to one of Britain’s biggest mortgage providers – Northern Rock – as it became the first major financial institution […]

US Economy Headed for Recession as Housing Bubble Bursts

Posted by Dr. Kurt Richebacher on Sep 14th, 2007 “America’s income-short, consumer-led recovery is the aberration – not the norm – in this Brave New World. It is all about ever-declining saving rates, ever-widening current account deficits, mounting debt burdens and increasingly wealth-dependent consumers. It personifies what I believe is one of the most precarious […]

More Mortgage Lenders to Close as Impact of Real Estate Slump Hits

Posted by Bill Bonner on Sep 13th, 2007 The Dow bounced right back – up 180 points Tuesday. Gold soared over US$721. What do you think, dear reader? Both went up…but which is the surer bet? We have our opinion. What bothers us is that it is too obvious. Central banks and financial intermediaries have […]

Graft inquiry condemns World Bank

The World Bank has not taken corruption seriously enough and has resisted the efforts of anti-graft investigators, an official inquiry has found. Paul Volcker, former head of the US Federal Reserve Bank, said his inquiry into the bank had revealed a “siege mentality” at the troubled institution. Read more

Recession Time! The Housing Bubble Bursts the Economy

By Dean Baker     t r u t h o u t | Perspective    Tuesday 11 September 2007     The downturn in jobs reported last month by the Labor Department provided evidence of an economic downturn that even the economy’s greatest cheerleaders could not ignore. Healthy economies do not shed jobs.     During the core periods of the upturns […]

Leading article: A crisis that spread from Wall Street to the high street

Published: 13 September 2007   Have we reached the moment when the contagion in the rarefied world of the credit markets finally begins to infect the real economy? This week two well-known fashion retailers, French Connection and Next, warned that trading conditions are likely to become a lot more difficult in the coming months. And yesterday, […]

Fed can’t stop recession

Even if the central bank starts to cut rates aggressively, many of the risks for the U.S. economy are beyond its reach. By Chris Isidore, CNNMoney.com senior writer September 13 2007: 1:35 PM EDT NEW YORK (CNNMoney.com) — Problems in housing, the financial markets and the first job decline in four years have made a […]

US, NZ ‘on a date’ for free trade pact

By Audrey Young  Richard Armitage Former US Deputy Secretary of State Richard Armitage likens US relations with New Zealand at present to “dating”. “It’s just like dating. I think we are on a date now,” he said at the second US-NZ Partnership Forum in Auckland, which finished yesterday. “We’re going to see if this works.” […]

Retirement Funds Vanish as Bankruptcies Hit Tax-Deferred Scheme

By Erik Larson Sept. 11 (Bloomberg) — Marsha Slotten’s bad news came in April by e-mail, from a tipster warning that the company holding her retirement nest egg had collapsed. After racing in a panic to the office of Southwest Exchange Inc. outside Las Vegas, she found a locked door and a sign saying the […]

Realtors Cut Forecast, Say Slump Will Extend to 2008

By Kathleen M. Howley Sept. 11 (Bloomberg) — The National Association of Realtors reduced its home sales forecast for the ninth time this year and said the housing slump will extend into 2008. Existing home sales will fall 8.6 percent in 2007, exceeding the 6.8 percent drop estimated a month ago. New-home sales probably will […]

Is China Dumping the U.S. Dollar?

« U.S. dollars change hands in Beijing, China. (STR/AFP/Getty Images) Is China Dumping the U.S. Dollar? September 10, 2007 | From theTrumpet.com Questions loom whether China is behind recent dollar sales—if it is, America’s way of life is about to change. The only question is how badly and how fast. By Robert Morley The U.S. […]

NZ Super Fund just grows and grows

By Graeme Hunt Adrian Orr says the fund is committed to ‘responsible investment’. Photo / Paul Estcourt It’s less than four years since the country’s most unusual Crown entity started investing with $2.4 billion of Government money. It received a further $7.7 billion from the state along the way and now has a fund worth […]

Nervous US investors start to fear recession

Friday’s news of a buckling United States job market sent stock investors running for the exits, and this week promises to be no less stressful as investors grapple with the increasing possibility of an economic recession. The weekend also gave investors time to reflect on news that US employers cut payrolls by 4000 jobs last […]