Note: I am still off on vacation so the posting schedule is light for this week. Next week will be back to a medium load.
I do have a lot of links though and here they are. The big issue is the economic slowing in the US and Europe.
ECONOMY
These articles demonstrate that the global slowdown is spreading beyond the eurozone periphery and is well entrenched in the US and Western Europe.
BBC News – Germany’s exports decline in June on eurozone woes
"Exports in June totalled 92.3bn euros ($114bn; £73bn), 1.5% lower than May, said the Federal Statistics Office.
At the same time, Germany’s imports dropped 3% to 76.1bn euros, resulting in a trade surplus of 16.2bn euros."
France headed for recession: central bank | Reuters
"France’s economy is likely to slip into a shallow recession in the third quarter, the Bank of France said on Wednesday, dashing hopes for a robust recovery this year and adding to signs that Europe’s economic prospects are worsening."
La producción industrial de Andalucía baja un 8,6% en junio respecto a 2011
In Spain, production in the southern region of Andalusia has taken a tumble of 8.6% in one year. This is evidence of a very nasty downturn.
McDonald’s Same-Store Sales Report Is a Warning Sign – MarketBeat – WSJ
I agree with the headline here. McDonalds is a diversified business that can serve as a proxy for consumer demand in Europe and the US. If McDonalds is having this kind of quarter, you have to think it is a warning sign indeed.
McDonald’s July same-store sales flat, worst in 9 years | Reuters
"The results came in far below Wall Street’s expectation and marked the first time since April 2003 that sales at restaurants open at least 13 months did not rise." "July sales in the United States and Europe were down 0.1 percent and 0.6 percent, respectively."
McDonald’s sales worst in two years as US recession bites – Telegraph
EURO CRISIS
Fitch cuts Slovenia’s rating by a notch, outlook negative | Reuters
This is generous given the problems Slovenia has had of late: "Fitch ratings on Wednesday downgraded its credit rating on European Union member Slovenia by one notch to A-minus citing a deterioration in the country’s banking sector during 2012."
Ireland has the most shopping centres per capita in EU – Irish, Business – Independent.ie
"Most of our shopping centres had being constructed during the boom and many are located in regional locations which cannot now sustain all their units.
The survey does not take into account the swathe of other non-shopping centre shops built in cities and towns during the boom."
Bankia se dispara un 24,44% y lidera las subidas en el Ibex – ABC.es
Bankia led all advancers on the IBEX today with over 24% gain. It’s now trading at 1.268 euros which is nearly double where it was two weeks ago. Still, this is down two-thirds from the IPO. If Bankia is getting bailed out, why does it even have shares. It’s ridiculous.
Bankia vende un 17% más de viviendas en el primer semestre gracias a los fuertes descuentos – ABC.es
Bankrupt Spanish caja Bankia sold 17% more houses in the first half of 2012 thanks to heavy discounting.
German money printing – Telegraph Blogs
Ambrose Evans-Pritchard thinks that the Europeans’ problem is a fall in money supply because he is a monetarist and so he points to where the Bundesbank allowed QE in the 1970s, calling their opposition now hypocrisy.
Debt crisis: euro founder Otmar Issing admits some countries could leave EMU: live – Telegraph
Monti under pressure to renounce bailout – FT.com
Hat tip.,Ida. Eventually Italy will succumb as well. Without unlimited central bank support, the euro zone will not be able to help Italy sustainably. This means the integrity of the euro zone is in great jeopardy as unlimited support is politically difficult. The concern here has to be the anti-German, nationalist turn in Italy. That will be the catalyst for breakup as depression takes hold. We have seen this in Greece and Spain as well.
Geldprofi Felix Zulauf: "Unendliches Leid über Europa" – Geldanlage – Finanzen – Wirtschaftswoche
STANDARD CHARTERED
Standard Chartered: Q&A on money laundering scandal – Telegraph
In U.K., a Backlash Over Standard Chartered Probe – WSJ.com
"While U.K. officials largely showed contrition in the Barclays and HSBC cases, they are now striking back and speaking up for Standard Chartered, an institution that had enjoyed a sterling reputation."
King questions StanChart probe – FT.com
"The governor of the Bank of England has questioned the approach of the US regulator that accused Standard Chartered of breaching sanctions by hiding $250bn of transactions linked to Iran."
Jesse’s Café Américain: Neil Barofsky on the Fed and Treasury Anger over Standard Chartered
"You can often, and I would say more often than not, in leading opinion-making elite circles, find an expressed renouncement or repudiation of that principle…All of these acts entail very aggressive and explicit arguments that the most powerful political and financial elites in our society should not be, and are not, subject to the rule of law because it is too disruptive, it is too divisive, it is more important that we should look forward, that we find ways to avoid repeating the problem…the rule of law is not that important of a value any longer"
Standard Chartered: Boris accuses US regulators of being "motivated by jealousy" – Telegraph
FT Alphaville » What’s StanChart’s plan B?
Standard Chartered and Iran: Banking for the bad guys | The Economist
TECHNOLOGY
"Apple is going to have to make long-term changes, both practical and symbolic, that communicate to users that they can trust iCloud and Apple’s security measures. But what those will be isn’t clear. And it’s not even clear Apple knows yet."
Why It Matters That Samsung Copied Apple [Opinion] – Droid Life
This piece argues that Samsung stole an unfair advantage on its Android competitors by copying the iPhone
HP Boosts Forecast, Sees $8 Billion Writedown – Bloomberg
"“They’re making changes, but it’s going to be several years before they get it right,” Seyrafi said. “The charges are a recognition that the prior management strategy did not succeed.”"
Hewlett-Packard’s Raised View Not as Good as it Looks – MarketBeat – WSJ
"The computer giant gave a downbeat target back in May, so today’s revision merely puts the forecast back in line with what analysts’ anticipated before the initial warning.
Since then, the stock fell 10% through Tuesday. So today’s 2.4% increase to $19.41 is but a blip for a company still going through myriad challenges. And the stock is still down 37% over the past year."
H-P’s stock rises on higher earnings outlook – MarketWatch
It’s complete hocus pocus to raise an adjusted earnings when you are taking a record impairment charge. This raised outlook is meaningless in my view. HP needs to deliver.
IDC: 68.1 percent of smartphones sold in Q2 were Android, Samsung led the surge
Apple sells 1.7 million iPads in China during Q2 to capture 72% of market
Android smartphone lead over Apple, RIM widens thanks to Samsung | FP Tech Desk | Financial Post
How Apple and Amazon Security Flaws Led to My Epic Hacking | Gadget Lab | Wired.com
This is a must-read for anyone concerned about their own Internet security.
Turn On Gmail’s ‘2-Step Verification.’ Now. – James Fallows – The Atlantic
Amazon Quietly Closes Security Hole After Journalist’s Devastating Hack | Gadget Lab | Wired.com
ELSEWHERE
In contrast to the fading growth prospects in the BRIC countries, Jim O’Neill sees Mexico, Indonesia, South Korea and Turkey as good bets for the coming years. I agree that these are economies to watch
The balance of payments: BoP until you drop | The Economist
Capital flight (and human flight) remains a concern in China. Here’s why: "more than 16% of China’s rich have already emigrated, or handed in immigration papers for another country, while 44% intend to do so soon. Over 85% are planning to send their children abroad for their education, and one-third own assets overseas."
A decade after the 9/11 attacks, Americans live in an era of endless war – The Washington Post
America is in a state of perpetual war. This has to lower GDP over the longer term as the military spending diverts capital to defense from other uses that could increase productivity
Tim Geithner’s principal hypocrisy | The Great Debate
Argentina: seizing the currency printer | beyondbrics
Argentina continues on the path toward Venezuelan-style socialism.
Treasury’s Secretive $2.4 Trillion Mutual Fund Guarantee – CNBC
"Acting without any explicit Congressional authority, the U.S. Treasury guaranteed in excess of $2.4 trillion of money market funds after the giant Reserve Primary Fund "broke the buck" following the bankruptcy of Lehman Brothers. The program, which ended on Sept. 18, 2009, seems to have successfully prevented a panicked run by money-market fund investors."
July was hottest month in US on record, reports NOAA – CSMonitor.com
Morgan Stanley price-fixing pact fought by AARP wins OK | Reuters
Population falls for third year; pace increases | The Japan Times Online
FT Alphaville » How to kill a bank, Denmark edition
US Supreme Court Allows Execution of Texas Inmate | Swampland | TIME.com