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Friday, 31 January 2014

January 31, 2014 Financial News Notes

China e-investing sparks ‘rate war’ with banks

Bank executive speaks of ‘all-out counterattack’

By Zhang Yuzhe and Liu Zhuozhe

BEIJING ( Caixin Online ) — Many big banks in the country have moved to offer the highest possible interest rates for deposits, despite the central bank’s advice they not do this.

 Rajan Warns of Policy Breakdown as Emerging Markets Fall

By Kartik Goyal Jan 31, 2014 1:32 PM GMT+0100

Jan. 30 (Bloomberg) -- India central bank Governor Raghuram Rajan talks with Bloomberg TV India's Vivek Law in Mumbai about interest rates, fund outflows, the rupee and global monetary policy coordination. (Source: Bloomberg TV India)
India central bank Governor Raghuram Rajan warned of a breakdown in global policy coordination after the Federal Reserve further cut stimulus, weakening emerging-market currencies from the rupee to the Turkish lira.

 China Said to Probe Credit Loophole Used to Access Cash

By Bloomberg News Jan 30, 2014 6:04 AM GMT+0100

China is probing a loophole that allowed executives at steel traders and other companies to bridge liquidity shortages for their firms by exceeding credit-card limits, according to three people familiar with the matter.

 China Resources Seeks Lenders for HK$6.4 Billion Syndicated Loan

By Paulina Duran Jan 30, 2014 7:46 AM GMT+0100

China Resources Power Holdings Co. (836) is seeking bank commitments for a HK$6.4 billion ($824 million) syndicated loan after hiring banks to arrange the deal, according to two people familiar with the matter.

 30 January 2014 Last updated at 02:14

Asian stocks tumble on Fed taper and currency fears

Asian markets have tumbled after the US central bank cut stimulus spending for a second month, and fears persisted over emerging market currency losses.

HSBC shares soar 10% on fat finger mistake

Stock Exchange investigating as bank shares suspended briefly after surge
The bank jumped from around 630p to 688p, prompting an automatic suspension of the shares for five minutes.
When they restarted they fell back to their previous level. One trader said: "This looks like a fat finger, it's a complete error. It looks like someone has taken a hit of around £400,000." 

Exclusive: Deutsche Bank suspends currency trader

By Gertrude Chavez-Dreyfuss

NEW YORK (Reuters) - Deutsche Bank has suspended the head of its emerging markets foreign exchange trading desk in New York in connection with ongoing investigations into the alleged manipulation of the global currency market, a source familiar with the matter said.

Bank of Cyprus unfreezes 950 mn euros in CDs

Nicosia (AFP) - Bank of Cyprus, the island's largest lender, released 950 million euros ($1.29 billion) in six-month certificates of deposit it had locked in following a haircut on savings during a March bailout of the economy.

Russell Investments' chief economist found dead in Tacoma

Russell Investments chief economist Mike Dueker was found dead Thursday, and police said it appeared he had taken his own life by jumping from a ramp near the Tacoma Narrows Bridge.

Currency devaluation ‘easy’ answer to emerging market crisis – Saxo Bank chief

Published time: January 30, 2014 15:48

The emerging market currency crisis is being propelled by policymakers who are “seeking the easy answer” by devaluing their currency, which is an unsustainable global model, Saxo Bank CEO Steen Jacobsen told RT.
The spectacular loss of value in emerging market currencies – the South African rand, the Russian ruble, the Indian rupee, and the Turkish lira- is a result of government's tightening monetary policy, which has even further driven down the value against the euro and dollar.

Why the world is watching the Fragile Five

By John Defterios, CNN

(CNN) -- After three weeks of punishing losses to its currency the lira, Turkey's central bank has taken what is being viewed as decisive action to reverse negative sentiment. At an emergency meeting Tuesday, the country's main interest rate was raised by 4.25 percent to 12 percent.

Digital Currency Founder: U.S. Indicted Me For Not Giving FBI My Source Code

 By Kim Zetter

The indicted founder of digital currency Liberty Reserve says the U.S. government began targeting him only after he refused to turn over the source code for his proprietary system to the FBI.

Arthur Budovsky, who is fighting extradition to the U.S. from Spain, told a Madrid court that the FBI approached him in 2011 to obtain the source code for what he says was the purpose of undermining the service.

Poland Confiscates Half Of Private Pension Funds To "Cut" Sovereign Debt Load

While the world was glued to the developments in the Mediterranean in the past week, Poland took a page straight out of Rahm Emanuel's playbook and in order to not let a crisis go to waste, announced quietly that it would transfer to the state - i.e., confiscate - the bulk of assets owned by the country's private pension funds (many of them owned by such foreign firms as PIMCO parent Allianz, AXA, Generali, ING and Aviva), without offering any compensation. In effect, the state just nationalized roughly half of the private sector pension fund assets, although it had a more politically correct name for it: pension overhaul.

ZeroHedges Frontrunning list for Jan 31

  • Even Obama's fans has turning on him: "The Decline and Fall of 'Hope and Change'"
  • European Stocks Drop, Head for Worst January Since 2009 (BBG)
  • Euro-Area Inflation at 0.7% Builds Rate Pressure on ECB (BBG)
  • Japan’s Inflation Accelerates as Abe Seeks Wage Gains (BBG)
  • Unpossible - this is the USSA: Detroit Debt Proposal Favors Pension Funds (WSJ)
  • Keystone Report Said Likely to Disappoint Pipeline Foes (BBG)
  • YHOO still pretending someone cares about it: Yahoo says detected hacking attempt on email accounts (Reuters)
  • How Google's Costly Motorola Maneuver May Pay Off (WSJ)
  • Mexico Surpassing Japan as No. 2 Auto Exporter to U.S.  (BBG)
  • Microsoft Seen Testing Insider Nadella’s Will to Revamp (BBG)
  • Top Obama aide predicts drama-free U.S. debt ceiling increase (Reuters)
  • The Dong fallout: Danish PM Blindsided as Ministers Quit in Goldman Spat (BBG)
  • U.S. Says Syria Delaying Chemical Disarmament (WSJ)
  • Emerging market funds lose $9 billion in past week (Reuters)

Currency chaos batters Aussie and loonie

Opinion: Collateral damage from the emerging-markets meltdown

....But two other leading currencies have become collateral damage. Over the past year, the Australian and Canadian dollars both have lost more than 10% of their value against the U.S. dollar, and currency traders expect them to fall further still. What’s more, their own central bankers have suggested they want to see their dollars even weaker.


Another Country Sells Off US Dollars To Diversify Reserves Into The Yuan

January 28th, 2014

... Nigeria is now selling off dollars to purchase the Yuan to beef up its reserves. Other countries have switched from the dollar and are using the yuan for bilateral trade.

America’s Karma and World War Two Gold Theft

And the Gold Recovery Attempts of the Korean and Vietnam Wars

By JC Collins