News Links 10/05/2011
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Follow the money: If Greece goes down, investors start fleeing Ireland, Spain, Italy, and Portugal as well. All of this sends big French and German banks reeling. If one of these banks collapses, or show signs of major strain, Wall Street is in big trouble. Possibly even bigger trouble than it was in after Lehman Brothers went down
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How did Europe’s bank stress tests give Dexia a clean bill of health? | Business | guardian.co.uk
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Elizabeth Warren doesn’t miss beat in Herald debate – BostonHerald.com
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If Google’s Management Doesn’t Use Google+, Then Why Should You?
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Samsung looks to block iPhone 4S sales in France, Italy — Engadget
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Bernanke Attacks China Over Currency Policy – CNBC
The chairman of the US Federal Reserve has accused China of damaging prospects for a global economic recovery through its deliberate intervention in the currency market to hold down the value of the renminbi.
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Apple squeezes out small carriers | Telecom | FP Tech Desk | Financial Post
Sprint Nextel Corp., the third-largest U.S. mobile operator, isn’t the only wireless company from which Apple Inc. is reportedly seeking steep terms for the iPhone, the newest version of which was unveiled Tuesday to less-than-stellar reviews.
At least one Canadian operator was in recent discussions to land the handset, people familiar with the matter said this week. Negotiations fell apart, however, because the Cupertino, Calif. company’s terms were too onerous.
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Tighter rules on capital: Bankers versus Basel – FT.com
According to some of the 30 or so people gathered in a meeting room at the archives, Mr Dimon lambasted Mr Carney – complaining vehemently that the Basel committee’s plan to subject his own and other large institutions to even higher capital requirements than those faced by smaller peers was ill-thought-out and economically and philosophically wrong. He also insisted that some provisions discriminated against US banks.
European bankers were left wide-eyed by the outburst but many of them have been launching their own, usually quieter, attacks on Basel III from the other side of the Atlantic. -
Banking’s Self Inflicted Wounds | The Big Picture
You may be wondering what is going on with the major firms in the financial sector. While each of these firms have different problems — vampire squids to Countrywide acquisitions — they all have something in common: Their balance sheets are opaque.
This is no accident. Indeed, it was by design that execs in the banking sector, and their outside accountants, hatched a scheme in 2008 to hide their balance sheets from public view. The bankers had been lobbying the Financial Accounting Standards Board to change the rules that governed “Fair Value Measurements” also known as FAS157 (September 2006).
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BBC News – Boehner says Senate currency bill is ‘pretty dangerous’
A top US Republican has criticised a Senate bill that could penalise China for alleged currency undervaluation.
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So the gamble Sprint is taking is that they will be able to sell iPhones at the same rate as Verizon and AT&T.
How is this risky?
The deal seems to be inline with what is known about the product’s popularity and the pattern of purchasing and upgrades that US consumers have been exhibiting for a few years.
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Sprint shares tumble on iPhone cost fears | Reuters
(Reuters) – Sprint Nextel shares fell as much as 17 percent on Tuesday as investors worried about the cost of selling the Apple Inc iPhone on top of its plans to upgrade its network and its debt obligations.
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Occupy Wall Street protests reach Boston, LA, St Louis and Kansas City, and are planned in cities across US and abroad
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Munis: The Shoe That Still Hasn’t Dropped – MarketBeat – WSJ
It seems, though, that state and local finances should still be at greater risk if we fall into another recession at the same time the federal government is tightening its own belt.
And muni debt has benefited from super-low borrowing costs at the federal level, which are in turn a function of the miserable state of the economy.
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Level 3 says to cut hundreds of jobs in U.S. | Reuters
(Reuters) – Level 3 Communications Inc (LVLT.O) expects to lay off hundreds of employees, mostly in the United States, as part of its effort to integrate its $1.9 billion Global Crossing purchase, a top executive said.
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Shorting Bans Do Little to Help Europe Banks, Instinet Says – Businessweek
Oct. 3 (Bloomberg) — Financial stocks subject to rules restricting short sales in France, Italy, Belgium and Spain have behaved about the same as banks in European countries with no such prohibitions, according to Instinet Inc.
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Dexia shares hit all-time low despite France and Belgium ‘guarantee’ – Telegraph
Shares in Dexia have hit an all-time low despite a joint statement of support for the troubled Franco-Belgian lender from the French and Belgian finance ministers.
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Eurozone to increase private sector burden in £136bn Greek bailout – Telegraph
Fears of a debt default by Greece were fuelled after eurozone finance ministers said they would increase the private sector’s burden in a second €159bn (£136bn) bailout for country.
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BBC News – Belgium approves ‘bad bank’ for Dexia assets
The Belgian government has approved the creation of a “bad bank” for risky assets held by the troubled Franco-Belgian bank Dexia.
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Moody’s cuts Italy credit rating by three notches | Reuters
(Reuters) – Moody’s Investors Service cut Italy’s bond ratings by three notches on Tuesday, saying it saw a “material increase” in funding risks for euro zone countries with high levels of debt.
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New Apple iPhone fails to wow investors, fans | Reuters
(Reuters) – Apple Inc’s newest iPhone left Wall Street and fans wishing for more than a souped-up version of last year’s device, igniting a rare storm of criticism and disappointment on the Internet.
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State outsourced allocation of federal disaster recovery funds to firm with ties to Perry
The state of Texas has quietly outsourced the management of more than $1 billion in federal disaster recovery funds to an engineering firm with close ties to Gov. Rick Perry’s administration, paying the Kansas City, Mo. -based firm HNTB $45 million so far to process infrastructure grants for communities damaged by Hurricanes Dolly and Ike.
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Perry Plummets, Cain Surges in Positive Intensity
PRINCETON, NJ — Rick Perry’s image is suffering, with his Positive Intensity Score among Republicans familiar with him down to 15, and below 20 for the first time. Meanwhile, Herman Cain’s score is now 30, the highest for any candidate this year.
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iPhone 4S vs. the smartphone elite: Galaxy S II, Bionic and Titan — Engadget
Now that we know how the iPhone 4S stacks up against the iPhone 4, let’s take a look at how Apple’s latest smartphone compares to its mightiest competitors on the other major platforms — Android and Windows Phone.
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CBO: Deficit Would Be One-Third Lower if Economy at Full Potential – Real Time Economics – WSJ
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ECB seen leaving rates on hold as Trichet bows out | Reuters
(Reuters) – The European Central Bank is likely to leave interest rates unchanged when it holds the last policy meeting of Jean-Claude Trichet’s presidency on Thursday, but may open the door to a cut under his successor and reintroduce some of its most potent crisis-fighting weapons.
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