- The Greek government has failed to reach consensus on the new bailout package requirements. The issue, apparently, is pension cuts. Papademos and Venizelos are taking it back to the Troika – so we shall see whether the Troika is willing to debate on this. But the frustration continues to grow. Greek Bailout Talks Stall, Frustrations soar as Greeks seek elusive bailout.
- The U.S. is likely to approve Google’s bid for Motorola next week. The acquisition is planned for around $12.5 billion. I used to have a motorola. In the early days. The Motorola RAZR was the height of hip cool. Perhaps a new androided version will make me turn from my iPhone (never!!). US Likely to Approve Google bid for Motorola.
- Winsway Coking Coal Holdings Ltd is on track for $1billion take-over of Grande Cache Coal Corp. (a Canadian coal miner). Which follows on the heels of Glencore-Xstrata (the thermal coal kids). The energy industry – merging and acquiring! The article is quite interesting because it mentions a number of failed M&A deals by Chinese companies in Canada. The back-story is that there is a rumour of some falsified results. But everyone is denying it. Winsway targeted by short-sellers.
- The Bank of England is supposedly planning more quantitative easing as a preventative measure against possible Euro contagion. Economists are expecting the bank to announce a £50 billion purchase of bonds later today. The increase in money supply is meant to act as a quasi-fiscal stimulus to economic growth. King may add to gilt stash to insure against crisis contagion.
- In case anyone hasn’t heard, Kodak filed for bankruptcy last month. But since 2001, the Kodak Theatre has been hosting the Oscars – and Kodak is committed to paying $72 million over the next 20 years in sponsorship fees. Kodak is trying to remove its name from the theatre – but the other side of the contract is unimpressed. Can you imagine – three weeks to go, and the Oscars may need to find a new venue? High society suicide! Kodak theatre must keep name despite bankruptcy.
- The American election year continues, and there is apparently a $25 billion mortgage deal for underwater homeowners. Most analysts seems to be a bit negative about what this will actually mean for the average home-owner. The consensus seems to be “not life-changing”. But I suppose it’s a good punchline for those speeches. States reach $25 billion mortgage deal with banks.
- China’s inflation is at a 3-month high of 4.5%. While it may only be temporary (higher spending over Chinese New Year) – there is some excitement as the Chinese have been concerned that their growth is not going to be up to expectations this year. To stimulate it, they have eased restrictions on the money supply by lowering the reserve ratios of banks. Lowering a reserve ratio means that the banks are able to lend more of their capital base – which is stimulative without the Central Bank actually printing money. While this can result in inflation – it should also result in capital investment and expansion, which translates into economic growth. China January Inflation at 3-month high.
- CNBC also had an interesting article on whether the US should abolish the Fed. It’s quite a nice argument in favour of central banks: Your money, your vote.