600ft jellyfish crop circle found in Oxfordshire field

A 600ft jellyfish pattern has appeared in a barley field in Kingstone Coombes, Oxfordshire, in what is one of the most intriguing crop circles ever seen in Britain.

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The jellyfish crop circle measures 600ft across Photo: M AND Y

The vast pattern appeared in the field last week and experts are claiming it to be the first of its kind in the world.

Karen Alexander, a crop circle expert, said: “We have seen butterfly and bird patterns in the past, but this is the first jellyfish crop circle in the world.

“It is absolutely huge – roughly three times the size of most crop patterns and extremely interesting. People have been aghast at the size of it. It is a complete monster.

“We are looking into the meaning of it, but at present it just seems to have appeared out of nowhere.”

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Geithner tries to assure Chinese investors, draws laughter from the audience

Quotes from the Great Depression


timothy-geithner Mr Geithner is on a two-day visit to Beijing, America’s biggest creditor

US Treasury Secretary Timothy Geithner has told the Chinese government its investments in the US are “very safe”, despite a growing budget deficit.

Mr Geithner is on his first official visit to China, the biggest foreign investor in US treasury bonds.

Ahead of meetings with President Hu Jintao and Premier Wen Jiabao, he said the US and China must work together to fix the global economic system.

Mr Geithner said the US would move swiftly to get its debt under control.

In a speech at Beijing University at the start of his two-day visit, Mr Geithner reassured his Chinese hosts that they need not worry about the estimated $770bn (£475bn) they have invested in US treasuries, a class of US government debt.

“Chinese financial assets are very safe,” he said, drawing laughter from the audience.

He will be hoping that China’s president and premier take his reassurance more seriously, because America needs China’s confidence, and its money, says the BBC’s Quentin Sommerville in Beijing.

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Biggest Holders Of Gilts Rather Sell Than Buy British Government Bonds: Survey

Standard & Poor’s has cut the outlook on Britain’s AAA credit rating to “negative”

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Gordon Brown, U.K. prime minister, leaves number 10 Downing Street to give money to a charitable cause, in London, U.K., on Tuesday, May 5, 2009. Photographer: Chris Ratcliffe/Bloomberg News

June 1 (Bloomberg) — U.K. debt is losing its allure for the biggest owners of gilts as the nation’s worst recession since World War II batters the government’s finances, according to a Bloomberg survey.

Eight of 10 funds, which oversee a combined $2.9 trillion, said they are either more likely to sell than buy British government bonds in the next three months or have no plans to purchase them, the survey conducted last week showed. Two said they were more inclined to buy than sell the securities.

Prime Minister Gordon Brown’s government aims to sell a record 220 billion pounds ($355 billion) of debt in the fiscal year through March 2010 to finance bank bailouts and measures designed to drag Europe’s second-largest economy out of the recession. Standard & Poor’s cut the outlook on Britain’s AAA credit rating to “negative” from “stable” on May 21, citing the country’s growing debt burden.

The U.K. is “spending heavily to rescue the banking system,” said Yuuki Sakurai, general manager of finance and investment planning in Tokyo at Fukoku Mutual Life Insurance Co., which oversees $54 billion. “The rating should be lowered.” Fukoku, one of the money managers surveyed, has no plans to buy gilts this year, he said.

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Black Swan Hedge Fund Makes a Big Bet on Inflation

A hedge fund firm that reaped huge rewards betting against the market last year is about to open a fund premised on another wager: that the massive stimulus efforts of global governments will lead to hyperinflation.

The firm, Universa Investments L.P., is known for its ties to gloomy investor Nassim Nicholas Taleb, author of the 2007 bestseller “The Black Swan,” which describes the impact of extreme events on the world and financial markets.

Related article: Rising US bond yields may spark Credit Crisis II (Reuters)

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Nassim Nicholas Taleb

Funds run by Universa, which is managed and owned by Mr. Taleb’s long-time collaborator Mark Spitznagel, last year gained more than 100% thanks to its bearish bets. Universa now runs about $6 billion, up from the $300 million it began with in January 2007. Earlier this year, Mr. Spitznagel closed several funds to new investors.

Unlike last year’s sudden market implosion, inflation isn’t an unimaginable event that few currently anticipate. In fact, many fear inflation right now amid government efforts to goose the economy. Universa’s bet, however, is that inflation will reach levels few expect.

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Rising US bond yields may spark Credit Crisis II

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NEW YORK (Reuters) – The global financial crisis may morph into a second, equally virulent phase where borrowing costs rise again, hobbling an embryonic economic recovery, debilitating cash-strapped banks, and punishing investors all over again.

Early warnings signs of this scenario include surging government bond yields, a slumping U.S. dollar, and the fading of the bear market rally in U.S. stocks.

Related article: Black Swan Hedge Fund Makes a Big Bet on Inflation (Wall Street Journal)

Optimists hope that a fragile two-month rally in world stock markets, a rise in U.S. Treasury yields from record lows during the depths of the crisis in late 2008, and some less scary economic data all signal that a recovery is around the corner.

But gloomy analysts insist that thinking is delusional.

Once Credit Crisis Version 2.0 ramps up, foreign investors may punish the U.S. government for borrowing trillions of dollars too much by refusing to buy its debt until bond prices plunge to much cheaper levels.

The telling harbinger is benchmark Treasury note yields’ surge to six-month highs around 3.75 percent this week, as investors began to balk at the record U.S. government borrowing requirement this year.

The U.S. Treasury plans to sell about $2 trillion (1.2 billion pounds) in new debt this year to fund a $1.8 trillion fiscal deficit.

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Chinese economists deem huge holding of US bonds RISKY

BEIJING, May 31 (Xinhua) — On the first day of U.S. treasury secretary Timothy Geithner’s visit to China, the Beijing-based Global Times published a survey of 23 famous Chinese economists on Sunday, saying that the majority of them deemed the vast holding of U.S. bonds “risky.”

Among the 23 experts polled, 17 said they believed that U.S. equities pose great risks to China’s economy.

Geithner will begin his first visit to Beijing as US treasury secretary in an attempt to assure the U.S.’ biggest creditor that its large holding of purchased US bonds is safe.

The visit also highlights Geithner’s comments made earlier this year alleging that China has manipulated its currency.

Li Wei, an expert with the Institute of Ministry of Commerce, and Tian Yun, a scholar at the China Macro Economics Institute, expressed concerns over the risks, saying that the United States may export its deepening crisis to China “by printing U.S. dollar notes uncontrollably.”

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Jimi Hendrix murdered by his manager, says former aide

John Bannister, the surgeon who dealt with Hendrix at hospital, has said he was convinced the star had drowned in red wine, despite having very little alcohol in his bloodstream.

“I recall vividly the very large amounts of red wine that oozed from his stomach and his lungs and in my opinion there was no question that Jimi Hendrix had drowned, if not at home then on the way to the hospital,” he wrote in 1992.


Source: The Independent

Star ‘stuffed with pills as part of insurance scam’

The rock legend Jimi Hendrix was murdered by his manager, who stood to collect millions of dollars on the star’s life insurance policy, a former roadie has claimed in a new book.

James “Tappy” Wright says that Hendrix’s manager, Michael Jeffrey, drunkenly confessed to killing him by stuffing pills into his mouth and washing them down with several bottles of red wine because he feared Hendrix intended to dump him for a new manager, according to a report in the Mail on Sunday.

In his book, Rock Roadie, Mr Wright says Jeffrey told him in 1971 that Hendrix had been “worth more to him dead than alive” as he had taken out a life insurance policy on the musician worth $2m (about £1.2m at the time), with himself as the beneficiary. Two years later, Jeffrey was killed in a plane crash.

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Ireland set to go bust, claims Harvard professor and author Niall Ferguson

A dire warning that the Republic is a prime candidate to go bust has come from one of the world’s leading economic historians.

“The idea that countries don’t go bust is a joke,” said Niall Ferguson, Harvard professor and author of The Ascent of Money.

“The debt trap may be about to spring” he said, “for countries that have created large stimulus packages in order to stimulate their economies.”

His chosen prime candidate to go bust is “Ireland, followed by Italy and Belgium, and UK is not too far behind”.

Argentina is top of his list of shaky countries but “the argument that it can’t happen in major western economies is nonsense”.

Professor Ferguson believes the economists are ill qualified to analyse the current economic situation since they lack the overview of historians such as himself.

“There are economic professors in American universities who think they are masters of the universe, but they don’t have any historical knowledge. I have never believed that markets are self correcting. No historian could.”

The historian does not subscribe to the theory of the “Great Depression” repeating and says this scenario is unlikely because the Federal Reserve has “massively expanded the monetary base which is the opposite of what happened in the 1930s”.

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General Motors to file for bankruptcy

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General Motors, once the largest company in the world, is expected to file for bankruptcy in a New York court tomorrow. Executives and politicians on both sides of the Atlantic are spending the weekend finalising details ahead of the historic capitulation that comes after months of talks and billions of dollars of government investment.

The filing will come on the heels of an eleventh-hour deal this weekend under which Magna International, the Canadian motor-parts group, agreed to rescue its European operations, which include two British plants employing 5,500 workers.

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Dollar Posts Biggest Drop Versus Euro in 2009

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May 30 (Bloomberg) — The dollar declined beyond $1.41 for the first time in 2009 in the year’s biggest monthly drop after investors dumped dollar-denominated assets as the U.S. budget deficit was projected to quadruple to $1.85 trillion.

The greenback fell against all of its major counterparts in May including the Australian and New Zealand dollars as the yield on the benchmark 10-year Treasury note touched the highest level since November. The pound rose above $1.60 as speculation an economic recovery is starting enhanced the appeal of sterling.

Related articles:
Rising US bond yields may spark Credit Crisis II (Reuters)
Bond Vigilantes Confront Obama as Housing Falters
(Bloomberg)
Marc Faber: U.S. will go into Hyperinflation, Approaching Zimbabwe Levels (Bloomberg)
US Will Eventually Lose Its AAA Credit Rating: Bill Gross (Bloomberg)
U.S. Treasury Blues: The Bond Bubble Has Burst (Barrons)

“It’s a fundamental dollar-down trade,” said James McCormick, global head of foreign exchange and local market strategy at Citigroup Inc. in London. “The truth is that countries like the U.S. with handicapped banking systems, with overextended fiscal policy, are going to see very shallow recoveries.”

The dollar weakened 6.3 percent this month to $1.4158 per euro, from $1.3230 on April 30. It was the biggest drop since December’s 9.2 percent decline. The greenback fell 3.3 percent to 95.34 yen from 98.63 at the end of last month. The yen slid 3.3 percent to 134.96 per euro, from 130.52.

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US Association of Physicians calls for Moratorium on GMO Foods

The American Academy of Environmental Medicine (AAEM) has just issued a call for an immediate moratorium on Genetically Manipulated (GMO) Foods.

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In a just-released position paper on GMO foods, the AAEM states that ‘GM foods pose a serious health risk’ and calls for a moratorium on GMO foods. Citing several animal studies, the AAEM concludes ‘there is more than a casual association between GMO foods and adverse health effects’ and that ‘GM foods pose a serious health risk in the areas of toxicology, allergy and immune function, reproductive health, and metabolic, physiologic and genetic health.’ The report is a devastating blow to the multibillion dollar international agribusiness industry, most especially to Monsanto Corporation, the world’s leading purveyor of GMO seeds and related herbicides.

In a press release dated May 19, the American Academy of Environmental Medicine, which describes itself as ‘an international association of physicians and other professionals dedicated to addressing the clinical aspects of environmental health,’ called immediately for the following emergency measures to be taken regarding human consumption of GMO foods:

* A moratorium on GMO food; implementation of immediate long term safety testing and labelling of GMO food.

* Physicians to educate their patients, the medical community and the public to avoid GMO foods.

* Physicians to consider the role of GMO foods in their patients’ disease processes.

* More independent long term scientific studies to begin gathering data to investigate the role of GMO foods on human health.

The AAEM chairperson, Dr Amy Dean notes that ‘Multiple animal studies have shown that GM foods cause damage to various organ systems in the body. With this mounting evidence, it is imperative to have a moratorium on GM foods for the safety of our patients’ and the public’s health.’ The President of the AAEM, Dr Jennifer Armstrong stressed that ‘Physicians are probably seeing the effects in their patients, but need to know how to ask the right questions. The most common foods in North America which are consumed that are GMO are corn, soy, canola, and cottonseed oil.’ The AAEM’s position paper on Genetically Modified foods can be found at http:aaemonline.org.

Related information:
Exposed: the great GM crops myth
The World According to Monsanto – A documentary that Americans won’t ever see
At stake is no less than control of the world’s food supply.

The paper further states that Genetically Modified Organisms (GMO) technology ‘abrogates natural reproductive processes, selection occurs at the single cell level, the procedure is highly mutagenic and routinely breeches genera barriers, and the technique has only been used commercially for 10 years.’

The AAEM paper further states, ’several animal studies indicate serious health risks associated with GM food consumption including infertility, immune dysregulation, accelerated aging, dysregulation of genes associated with cholesterol synthesis, insulin regulation, cell signalling, and protein formation, and changes in the liver, kidney, spleen and gastrointestinal system.’

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Bond Vigilantes Confront Obama as Housing Falters

May 29 (Bloomberg) — They’re back.

For the first time since another Democrat occupied the White House, investors from Beijing to Zurich are challenging a president’s attempts to revive the economy with record deficit spending. Fifteen years after forcing Bill Clinton to abandon his own stimulus plans, the so-called bond vigilantes are punishing Barack Obama for quadrupling the budget shortfall to $1.85 trillion. By driving up yields on U.S. debt, they are also threatening to derail Federal Reserve Chairman Ben S. Bernanke’s efforts to cut borrowing costs for businesses and consumers.

The 1.4-percentage-point rise in 10-year Treasury yields this year pushed interest rates on 30-year fixed mortgages to above 5 percent for the first time since before Bernanke announced on March 18 that the central bank would start printing money to buy financial assets. Treasuries have lost 5.1 percent in their worst annual start since Merrill Lynch & Co. began its Treasury Master Index in 1977.

“The bond-market vigilantes are up in arms over the outlook for the federal deficit,” said Edward Yardeni, who coined the term in 1984 to describe investors who protest monetary or fiscal policies they consider inflationary by selling bonds. He now heads Yardeni Research Inc. in Great Neck, New York. “Ten trillion dollars over the next 10 years is just an indication that Washington is really out of control and that there is no fiscal discipline whatsoever.”

Don’t miss:
Marc Faber: U.S. will go into Hyperinflation, Approaching Zimbabwe Levels (Bloomberg)
US Will Eventually Lose Its AAA Credit Rating: Bill Gross (Bloomberg)
U.S. Treasury Blues: The Bond Bubble Has Burst (Barrons)

Investor Dread

What bond investors dread is accelerating inflation after the government and Fed agreed to lend, spend or commit $12.8 trillion to thaw frozen credit markets and snap the longest U.S. economic slump since the 1930s. The central bank also pledged to buy as much as $300 billion of Treasuries and $1.25 trillion of bonds backed by home loans.

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FDIC: Troubled Bank Loans Hit a Record High

money-banks

OVERALL loan quality at American banks is the worst in at least a quarter century, and the quality of loans is deteriorating at the fastest pace ever, according to statistics released this week by the Federal Deposit Insurance Corporation.

The report highlighted that even as the government and major banks have scrambled to deal with the impaired securities the banks own, the institutions have been plagued by an unprecedented volume of old-fashioned loans going bad.

Of the entire book of loans and leases at all banks — totaling $7.7 trillion at the end of March — 7.75 percent were showing some sign of distress, the F.D.I.C. reported. That was up from 6.9 percent at the end of 2008 and from 4.1 percent a year earlier. It also exceeded the previous high of 7.26 percent set in 1990 and 1991, during the last crisis in American banking.

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Gates: U.S. will not accept nuclear North Korea

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South Korean sailors take part in exercises Friday in disputed waters off the Korean Peninsula.

(CNN) — The United States will not accept North Korea as a nuclear-armed state, Defense Secretary Robert Gates said Saturday at an international conference.

“We will not stand idly by as North Korea builds the capability to wreak destruction on any target in the region — or on us,” said Gates, speaking at the International Institute for Strategic Studies in Singapore.

“Our goal is complete and verifiable denuclearization of the Korean Peninsula, and we will not accept North Korea as a nuclear weapons state,” he said.

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Bond markets defy Fed as Treasury yields spike

The US Federal Reserve may soon be forced to launch fresh blitz of quantitative easing whatever the consequences for the US dollar, or risk seeing economic recovery snuffed out by the latest surge in long-term borrowing costs.

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Market expects Fed will have to double purchases of Treasuries. Photo: Getty Images

Yields on 10-year Treasury bonds have risen relentlessly since March when the Fed first announced its plan to buy $300bn (£188bn) of US government debt directly, a move that briefly forced rates down to nearly 2.5pc, a level thought to be the Fed’s implicit target.

Yields have jumped to 3.69pc – after spiking as high as 3.74pc on Wednesday – pushing up the standard 30-year mortgage loan to 5.08pc and lifting the borrowing cost for corporations.

“The Fed is going to have to consider doubling its purchases of Treasuries,” said Ashraf Laidi, from CMC Capital Markets. “We could be nearing the end-game for the US dollar but the Fed has little choice at this point. We’re in a vicious circle where any policy aimed at supporting the US economy must be at the expense of the dollar.”

Related article:
Marc Faber: U.S. will go into Hyperinflation, Approaching Zimbabwe Levels (Bloomberg)

The US Mortgage Bankers Association yesterday highlighted the fragility of the US housing market, reporting that 12pc of homeowners are either behind on their payments or facing foreclosure, the highest level since records began.

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About 12 pct of US homeowners late paying or foreclosed

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2008 World Press Photo Foreclosure

NEW YORK, May 28 (Reuters) – One of eight U.S. households with a mortgage ended the first quarter late on loan payments or in the foreclosure process in a crisis that will persist for at least another year until unemployment peaks, the Mortgage Bankers Association said on Thursday.

U.S. unemployment in April reached its highest rate in more than a quarter century and is still rising, helping propel mortgage delinquencies and foreclosures to record highs.

Such economic weakness drove up foreclosures of prime fixed-rate loans, which are made to the most creditworthy borrowers. The foreclosure rate on those loans doubled in the last year and represented the largest share of new foreclosures in the first three months of this year.

“We clearly haven’t hit the top yet in terms of delinquencies or the bottom of the housing market,” Jay Brinkmann, the association’s chief economist, said in an interview.

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