Apr 19

Jean-Claude Juncker, the EU’s ‘Mr Euro’, has given the clearest warning to date that the world authorities may take action to halt the collapse of the dollar and undercut commodity speculation by hedge funds.

Jean-Claude Juncker, who is calling for Washington to
take steps to halt the slide of the dollar

Momentum traders have blithely ignored last week’s accord by the G7 powers, which described “sharp fluctuations in major currencies” as a threat to economic and financial stability. The euro has surged to fresh records this week, touching $1.5982 against the dollar and £0.8098 against sterling yesterday.

“I don’t have the impression that financial markets and other actors have correctly and entirely understood the message of the G7 meeting,” he said.

Mr Juncker, who doubles as Luxembourg premier and chair of eurozone financiers, told the Luxembourg press that he had been invited to the White House last week just before the G7 at the urgent request of President George Bush. The two leaders discussed the dangers of rising “protectionism” in Europe. Mr Juncker warned that matters could get out of hand unless America took steps to halt the slide in the dollar. Continue reading »

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Apr 09

Shortages of the staple crop of half the world’s people could bring unrest across Asia and Africa, reports foreign affairs editor Peter Beaumont

A global rice shortage that has seen prices of one of the world’s most important staple foods increase by 50 per cent in the past two weeks alone is triggering an international crisis, with countries banning export and threatening serious punishment for hoarders.

With rice stocks at their lowest for 30 years, prices of the grain rose more than 10 per cent on Friday to record highs and are expected to soar further in the coming months. Already China, India, Egypt, Vietnam and Cambodia have imposed tariffs or export bans, as it has become clear that world production of rice this year will decline in real terms by 3.5 per cent. The impact will be felt most keenly by the world’s poorest populations, who have become increasingly dependent on the crop as the prices of other grains have become too costly.

Continue reading »

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Apr 03

According to Bill Gross, a fixed income market guru, the size of the credit default swap market is “$43 trillion, more that half the size of the entire asset base of the global banking system.” If that is not scary enough he goes on to tell is that “total derivatives amount to over $500 trillion, many of them finding their way”………………….well, everywhere.

You are going to be hearing a lot more about these markets in coming weeks and months, which begs the question, why don’t most people even know what they are? And more importantly, why should we care? Continue reading »

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