Federal Reserve Chairman Ben Bernanke reiterated his opinion that "at this stage conditions in financial markets are still far from normal."
Liquidity is better in several market segments and the Fed's interventions have helped relieve much stress, he told a Bank for International Settlements conference in Basel, Switzerland by videoconference.The Fed chairman was largely repeating a speech he gave May 13 to an Atlanta Fed conference. Back then, he said that although improving, at this stage conditions in financial markets are still far from normal.In today’s conference, he also said that the Fed stood ready to expand its liquidity-providing facilities, the Term Auction Facility for banks in particular, if financial market difficulties demand it. Much of Bernanke's speech was devoted to explaining the extraordinary expansion of direct Fed lending to Wall Street in the wake of the credit crisis. He reiterated that the Fed’s decision to shepherd and help finance takeover of Bear Stearns by JP Morgan Chase was aimed to prevent a much broader liquidity crisis.
Thursday, May 29, 2008
Monday, May 26, 2008
US ready in recession
he world’s richest man, Warren Buffet said that United States is already in recession.
In an interview with German magazine Der Spiegel on Saturday, he said said the United States is already in recession and added: "Perhaps not in the sense that economists would define it" with two consecutive quarters of negative growth.
"But the people are already feeling the effects," said Buffett,"It will be deeper and last longer than many think."
Buffett, the 77-year-old chief of the Berkshire Hathaway holding company, just overtook Bill Gates this year as the world's richest man. His wealth jumped from 52 billion dollars last year to 62 billion.
Buffett also blamed financial institutions for introducing instruments 'they can no longer control. He also said he believed the financial markets should be more tightly regulated.
US economic growth has slowed dramatically in recent months and many economists say the US economy will experience a recession during 2008 amid a housing slump and related credit crunch.
Thursday, May 22, 2008
BoJ Is Watching Inflationary Expectations
Bank of Japan policy makers said they need to monitor consumers' rising expectations for inflation.
Some members said that consumers' inflation expectations were rising, reflecting the ongoing rise in the price of daily necessities, and this warranted attention, some members said at the April 8-9 policy meeting, according to the minutes released today in Tokyo. A few members said rising prices have damped consumer sentiment.
Since the meeting, the central bank cut its growth forecast and shelved a policy of gradually raising interest rates. Governor Masaaki Shirakawa told parliament yesterday that costlier energy and raw materials will erode corporate profits and household incomes and that may force companies and consumers to pare spending, slowing Japan's longest postwar expansion.
The central bank dropped a call for gradual rate increases in its twice-yearly outlook on April 30 and cut its estimate for this fiscal year's expansion to 1.5 percent from 2.1 percent. It said consumer prices excluding fresh food will climb 1.1 percent, raising its inflation projection from 0.4 percent.
The Bank of Japan has kept borrowing costs unchanged since February 2007, when it doubled the overnight lending rate to 0.5 percent. The rate remains the lowest in the industrialized world.
The International Monetary Fund said this week that the central bank's policy represents a wait-and-see attitude. That's the appropriate stance to safeguard growth.
The greenback bertahan dari tekanan major
Penguatan dolar ini selain disinyalir adanya aksi profit taking oleh para investor, juga didukung oleh terkoreksinya harga minyak dunia
Ulasan Fundamental
Perdagangan currency sampai penutupan pasar AS, dolar berhasil bertahan dari tekanan major currency, kecuali oleh pound. Faktor pendorong penguatan dolar ini selain disinyalir adanya aksi profit taking oleh para investor, juga didukung oleh terkoreksinya harga minyak dunia menembus kembali level $ 130 per barel. Sedangkan poundsterling kembali menunjukan dominasinya sampai penutupan karena penurunan data ekonomi retail sales U.K tidak seperti yang dikhawatirrkan sebelumnya hanya sebesar 0.2 persen dari perkiraan sebelumnya 0.5 persen. Spekulasi kemungkinan kenaikan suku bunga BOE turut pula mendukung the cable berjaya.
Untuk perdagangan currency hari ini fokus pasar akan menantikan serangkaian data ekonomi baik dari kawasan Eropa ataupun dari Amerika sendiri. Pergerakan dolar diperkirakan akan melemah diakhir pekan ini, masalah stagflasi ekonomi Amerika, ketidakjelasan interest rate outlook the fed, serta meroketnya harga minyak dunia akan menjadi faktor yang bisa memberatkan the greenback. Sedangkan disisi lainya baik pihak ECB ataupun BOE justru berpotensi akan mempertahankan kebijakan suku bunga tingginya dalam usaha meredam gejolak inflasi yang terjadi di kedua kawasan tersebut.
Forex (valid 23 Mei / 13.00-19.00 WIB)
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US Stagflation become a nightmare
Wall street going dip again, and Asia bourse expected open lower following the US market last night.
The projection that unemployment rate rise up these year thus US consume will decrease and economic growth become slower. The Fed signaled that they open mind to cut interest again.
Consumer good, industry, and transportation are strike by these projection and make investors put them sell especially when the oil price creeping to $ 134 per barrel.
Consumers will reduce their spend while energyu price are high, it would make company gain are lower where divide to stock holder are lowest.
Financial sector has damped bay US financial institution where their gain average are turn lower average 19% in near term. Profit taking are predicted happen to these sector today in Asia market. Real sector facing default by financial sector after US micro conditions are not favorable. Technology sector probably crushed by US negative sentiment where energy price are so high.
Yen appreciated to Dollar US and could push export shares are lower today. For Hangseng, these afternoon are data released for Hong Kong economy growth, market estimated are consolidated, and effected to the market probably tomorrow.
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