USA: СВ Consumer Confidence makes up 52.5pts in December

 

Dec 28^th 2010 at 15.00GMT the US Conference Board released its Consumer Confidence report.

Previous value 54.1 Forecast 56.3

The СВ Consumer Confidence index is a composite index based on household research. The consumer confidence index is an anticipatory indicator of consumer spending, which in its turn is the main indicator of the country’s overall economic activity. The survey involves 5000 households. The respondents are asked to evaluate the present and future economic conditions, including labor market perspectives, business conditions and general economic situation.

In the US the СВ Consumer Confidence index grows in value, however insignificantly (a couple of points). According to James Nielsen, vice-president of Global Consumer Insights under Nielsen Co., the Americans are still too cautious about their spending in the light of economic ambiguity and still high unemployment level.

Switzerland: KОF Econоmic Barоmeter makes up 2.1pts in December

On Dec 29^th at 10.30GMT the KOF Economic Research Agency released its Econоmic Barоmeter index for December.

Previous value 2.12 Forecast 2.08

KОF Econоmic Barоmeter is a composite indicator based on 12 economic indexes. It is used to define Switzerland’s economic development perspectives for the next 6 months. As a rule the value is volatile.

The 12 indexes are connected with Switzerland’s banking sector, housing market, industrial production, new manufacturing orders and consumer confidence.

The KОF Econоmic Barоmeter index entered the positive zone inSeptember 2009. It has been staying positive ever since even though since July 2010 it has been showing some weakness. It means that the GDP keeps growing while the pace of economic growth starts declining.

How real is the possibility of Germany leaving the EU?

 

This year has shown that the further perspectives of the EU and its currency are not that favorable. Some experts even say that their existence may go out on a limb. According to them, there are plenty of significant reasons for numerous countries of the Euro zone to go back to their own national currencies. And they well may do it in the future.

What is Germany dissatisfied with?

Masterforex-V Academy experts have defined the following issues:

·         The only thing known for a certainty is that most Germans are not satisfied with the common European currency.

·         The Cologne-based analytic center called YoGov-Institut has recently conducted a corresponding survey. The results show that about 49% of the respondents want the D-Mark back while 41% oppose their opinion.

·         No wonder that the results look like that because the Euro currency is less reliable than the old D-Mark, which has had a significant impact on the income and the quality of life of most Germans.

·         Having a relatively powerful economy Germany has to support its weaker EU counterparts.

Portugal runs out of sugar. Will it affect Europe?

Market Leader informed

Previously Masterforex-V Academy experts repeatedly suggested paying attention to the fact that sugar and coffee prices had been constantly increasing and updating their highs around the world. The recent publications of the Financial Times prove that in 2011 the situation is unlikely to change for the better. Moreover, the supplies of sugar and coffee will be restrained, which in its turn will create favorable conditions for the prices to continue their way up. Indeed, it sounds like a rather probable scenario if to take into account that last week Portugal completely exhausted its sugar reserves.

In terms of figures, the terrible situation looks as follows: On Monday at NYMEX the March raw-sugar contract broke a 30-year price record by reaching $0.335 per pound (453g). On the same day the March coffee contract (Arabica) reached $2.2695 per pound, which appeared to be a new price record in 30.5 years.

Crises of the Nineties and Ways of Combating Them (Part III)

Market Leader informed

Crisis in Japan and its consequences

In late 1980s some ‘forecasters’ claimed that Japan, which had been developing much faster than the US for a long time, would soon overtake it in terms of GDP per capita and, in the first decade of the 21^st century, the total gross domestic product and industrial production. In the 1990s Japanese growth rates were more than twice less than in the US and reached even negative figures in 1998 ending up around the zero in 1999-2000.Japanese decline came about because of a lot of factors – from ‘infection with the Asian illness’ to structural ailments of Japanese economy. However, most analysts believe that organic vices of the financial system that came to the foreground played the most important role.

In a somewhat sensational book intended to destroy the myth of the everlasting Japanese miracle, Professor D. Hayes (a European citizen living and working in Japan) writes: “The core of the Japanese financial system has kind of inherent mould. Whether we look at the Japanese financial system from a micro or a macro perspective, we see one and the same picture everywhere: fraud, nepotism, absolute lack of competence”. You can also read the following in the summary on the book’s cover: “Japan allowed large-scale infiltration of organized crime into its financial institutions".

Crises of the Nineties and Ways of Combating Them (Part II)

Market Leader informed

Features unique to the Brazilian crisis in 1998-1999

It isn’t easy to find a country in the world with such an explosive potential – the gap between the rich and the poor is among the widest globally. Having peacefully liquidated the military dictatorship in late 1980s, Brazil, a federation by state structure, opted for the path of liberal and democratic (by Latin American standards) development. However, inflation which reached hundreds and even thousands of percent a year remained its primary obstacle to normalization of the economic situation. In 1994, a financial stabilization was carried out upon the initiative and under the supervision of Finance Minister Cardoso to become the first success in many decades. Inflation was lowered to a level of several percent a year. Furthermore, this Brazilian-style shock therapy didn’t put an end to industrial growth. These achievements made such a strong impression on the nation that soon Cardoso was elected President and reelected for the second term in 1998.

Crises of the Nineties and Ways of Combating Them (Part I)

Market Leader informed

The former Managing Director of the International Monetary Fund, Michel Camdessus, described the financial crisis that struck Mexico in 1994-1995 as ‘The First Crisis of the 21^st Century’. The Great Seven industrial nations held another summit in summer 1995 to discuss, among other issues, Mexican-style crises and ways of preventing them. These concerns didn’t take long to materialize themselves. The crisis in countries of Eastern and South-Eastern Asia in 1997-1998 had many features in common. The largest nation of Latin America, Brazil, ended up in the orbit of a similar crisis in fall 1998. Finally, even though Russia has a special crisis many of its aspects resemble both the Mexican and Brazilian scenario.

Common features of 1990s crises

The then fashionable word ‘globalization’ can be taken as a starting point. Capital always tends to look for most favorable spheres of attraction worldwide. But before early 1990s there had never been such opportunities – political, economic, technical, informational. Only such islands as North Korea remain closed to foreign capital till today.

GBPUSD volatility in advance of Christmas holidays

Market Leader informed

Last week the FOMC announced that the economic improvement won’t prevent it from pouring $600 into the market of bonds until the unemployment is high. Will it help the US economy?

Let’s look at this week’s news releases:

Dec 21st
9:30 GBP - Public Sector Net Borrowing

Dec 22nd
9:30 GBP - Current Account
9:30 GBP - MPC Meeting Minutes
15:00 USD - Existing Home Sales

Dec 23rd
13:30 USD - Core Durable Goods Orders
13:30 USD - Unemployment Claims
15:00 USD - New Home Sales

 

What Euro Rates Should be Expected Before Christmas?

Market Leader informed

The Euro is trading today in the range of 1.3130-1.3180.

 

Investors are gradually preparing for Christmas and the calm is coming to markets. No sharp moves were seen early during the trading day on Monday with the dollar stabilizing across the entire spectrum of the market. The Euro remains under pressure because EU countries leaders failed to adopt any fundamental measures last week.

 

Is Forex in Any Way Different from Gambling: Casino, Slot Machines or Thimblerig?

Market Leader informed

Can one make money in the forex? What is the difference between the forex and gambling: casino, slot machines or thimblerig? It is this kind of an attitude to the foreign exchange market, its likening to a type of gambling that starts showing itself in analytical news overviews in a number of media. What indeed is forex for Russians and residents of the world’s other countries?

 

Is there any difference between forex and gambling (casino, slot machines, thimblerig etc)?

 

Experts of the Analytical Team of the Masterforex-V Trading Academy pointed out that trading in the forex, stock and commodities markets is fundamentally different from gambling in a casino, on slot machines: