World Financial Report – December 1st, 2011

Radio Show Newsletter

• Charts of the Week-Quotes-Quick Hits
• RareColoredDiamonds.com
• Gold
• Silver
• QE
• Sovereign Debt
• U.S. Debt-Deficit
• Real Estate

CHARTS OF THE WEEK-QUOTES-QUICK HITS

-CHART OF THE WEEK: Guess Which Country Has The Highest Percentage Of Workers Employed By The Government. Read
more here-http://tinyurl.com/cg5q72c

-CHART OF THE WEEK: China’s Exports to Europe ‘Falling Off Cliff’. Slumping shipping costs show exports to Europe from China are “falling off a cliff” as the euro-region crisis chokes off consumer spending, according to RS Platou Markets AS, a unit of Norway’s biggest shipbroking group. Read more here-http://tinyurl.com/cpqqpr3

-”The mind, once expanded to the dimensions of larger ideas, never returns to its original size.” Oliver Wendell Holmes

-”This is called united system ease. It increases liquidity. It scratches the surface of QE, but is not QE. QE is inevitable. It is the only tool that can stop a run on a bank, be it sovereign, investment or commercial. Alf Fields is right when he says “Once this correction has been completed, Intermediate Wave III of Major Three will be underway. This should be the largest and strongest wave in the entire gold bull market. The target for this wave should be around $4,500 with only two 13% corrections on the way.” Jim Sinclair

-”If you don’t trust gold, do you trust the logic of taking a beautiful pine tree, worth about $4,000-$5,000, cutting it up, turning it into pulp and then paper, putting some ink on it and then calling it one billion dollars?” Ken Gerbino

-Fed Lowers Interest Rate on Dollar Swaps. Six central banks led by the Federal Reserve lowered the cost of emergency dollar funding for financial companies in a global effort to ease Europe’s sovereign-debt crisis. The new interest rate is the dollar overnight index swap rate plus 50 basis points, a half percentage-point cut, and the program was extended by six months to Feb. 1, 2013, the Fed said Wednesday in a statement in Washington. The Fed coordinated the move with the European Central Bank as well as the Bank of Canada, Bank of England, Bank of Japan, and Swiss National Bank. Read more here-http://tinyurl.com/chocr8c

-El-Erian: The reduced cost of emergency dollar funding signals the Federal Reserve and other central banks are concerned about the global banking system, according to Pimco’s Mohamed A. El-Erian. The aim is to ease strains in financial markets and “thereby mitigate the effects of such strains on the supply of credit to households and businesses and so help foster economic activity,” a Fed statement said.

“I don’t think that is the main objective,” El-Erian said. “The real objective is they are seeing something in the functioning in the banking system that worries them and they are taking preemptive measures to relieve that pressure.” While the stated goal of the program may help mollify policy makers and “the person in the street,” El-Erian said, the move is “a reaction to a break in the markets and central banks’ realizing that they need to move before this breakage becomes irreversible.” Read more here-http://tinyurl.com/c5lpll7

-Euro Ministers Seek Greater IMF Role as Bailout-Fund Expansion Falls Short. European finance ministers said they would seek a greater role for the International Monetary Fund alongside their own bailout fund in their latest gamble at taming the euro zone’s sovereign debt crisis. Ministers turned to the IMF after conceding that higher interest rates and lower appetite for European bonds made it impossible for the European Financial Stability Facility to be leveraged up to its 1 trillion euro ($1.3 trillion) target. Read more here-http://tinyurl.com/cxlhwge

-Payback Time: Citi Warns Of A Coming Decade Of Deleveraging. The Western World is just getting started on the second of two lost decades, according to a big report by Citi’s Matt King. While the last lost decade was characterized by boom and bust, the new one will be characterized by deleveraging and slow growth. We haven’t even begun to erase the massive debt load from the past few decades. The UK particularly stands near the Japanese peaks of the early 1990s. Read more here-http://tinyurl.com/729cyyg

-American Airlines Parent AMR Files Bankruptcy; Horton Named CEO. American Airlines parent AMR Corp. filed for bankruptcy after failing to secure cost-cutting labor agreements and sitting out a round of mergers that dropped it from the world’s largest airline to No. 3 in the U.S.

With the filing, American became the last of the so-called U.S. legacy airlines to seek court protection from creditors. The Fort Worth, Texas-based company, which traces its roots to 1920s air-mail operations in the Midwest, listed $24.7 billion in assets and $29.6 billion in debt in Chapter 11 papers filed in U.S. Bankruptcy Court in Manhattan. Read more here-http://tinyurl.com/c72zadz

-How Hank Paulson Gave Hedge Funds Advance Word On Freddie and Fannie During Financial Crisis. Read more here-http://tinyurl.com/84ubru2

-MF Trustee to Return Up to $2.1B to Customers. The trustee liquidating MF Global Inc. will return as much as $2.1 billion to commodity customers, an amount that’s 66 percent of U.S. customers’ segregated assets. The shortfall in the MF Global brokerage’s U.S. segregated customer accounts may exceed $1.2 billion, more than double what was previously expected. Read more here-http://tinyurl.com/d92effc

-Corzine Pushed Europe Bet to $11.5 Billion. Jon Corzine bet $11.5 billion on European sovereign debt in his bid to rebuild profits at MF Global Holdings Ltd., almost twice the net amount disclosed to investors, and relied on short-term hedges that left the firm exposed to larger losses if they couldn’t be rolled over. Read more here-http://tinyurl.com/coh3h34

-BofA, Goldman Sachs, Citigroup Credit Ratings Cut by S&P. Read more here-http://tinyurl.com/dyo5b8z

-China Banks Get Higher Grades Than Most U.S. Rivals by S&P. Read more here-http://tinyurl.com/cckbgav

-Fed Sees ‘Slow to Moderate’ Growth in 11 Districts. The Federal Reserve said the economy expanded at a “moderate” pace in 11 of 12 districts, led by gains in manufacturing and consumer spending. “Overall economic activity increased at a slow to moderate pace since the previous report across all Federal Reserve districts except St. Louis, which reported a decline in economic activity,” the Fed said in its Beige Book survey released today in Washington covering October and the first half of November.

The report reinforces the central bank’s view that the economy, while strong enough to skirt a recession, remains too weak to bring down an unemployment rate stuck near 9 percent or higher for more than two years. At their last meeting Nov. 1-2, some Fed policy makers said the central bank should consider easing policy further, according to minutes of the meeting. Wednesday’s report said “hiring was generally subdued” and residential real estate “generally remained sluggish.” Read more here-http://tinyurl.com/bmp6swk

-ADP Says U.S. Companies Added 206,000 Workers. Read more here-http://tinyurl.com/82wdfy9

-Announced U.S. Job Cuts Drop 13% From Year Ago to 42,474, Challenger Says. Planned firings dropped 13 percent to 42,474 from November 2010, according to figures released today by Chicago-based Challenger, Gray & Christmas Inc. So far this year, there have been 563,297 announced job reductions, more than the 529,973 for all of 2010. Government agencies, which had the most cutbacks in November, may continue to shed military and civilian positions in 2012 amid budget cuts, Challenger said. Read more here-http://tinyurl.com/7tyzpo8

-Thanksgiving Sales Set Record as Shoppers With Jobs Chase Bargains. U.S. consumers poured into the malls and took to the Web during Thanksgiving weekend, spending a record $52.4 billion at a pace that may be hard to sustain as the holiday shopping season gets under way. Read more here-http://tinyurl.com/bvrwc7o

-Black Friday Draws Younger Shoppers. Read more here-http://tinyurl.com/d62nadd

-Cyber Monday Sales Jump as More Holiday Shoppers Head Online. Read more here-http://tinyurl.com/c2uefdq

-U.S. Workers’ Sliding Share of Pay Poses Spending Risk: Economy. Read more here-http://tinyurl.com/d7os4s8

-More than 1 in 5 Americans are economically insecure. More than one in five Americans saw at least a quarter of their available household income vanish each year during the Great Recession, and they lacked a sufficient financial cushion, according to a report released.

More than 20% of the nation faced this condition in each of the three years spanning 2008 to 2010, a sharp increase from 14.3% in 1986. Some 62 million Americans faced economic insecurity last year. Many of the people who suffered in the economic downturn are in the middle class. Read more here-http://tinyurl.com/ckmw5j2

-Lottery Sales Rise to Records in 17 States. Facing growing unemployment, record home foreclosures, declining tax revenue and an annual budget deficit that reached $3 billion, Arizona revamped a key money-making enterprise: the state lottery. Read more here-http://tinyurl.com/75xm4dt

-60 Minutes: Hard Times Generation: Families living in cars. The number of kids in poverty in America is pushing toward 25 percent. One out of four. Read more here-http://tinyurl.com/7zpa2c6

-Number of N.J. residents receiving food stamps doubled in last four years. Read more here-http://tinyurl.com/ct6argc

-Iran: We’ll fire 150,000 missiles at Israel if attacked. Defense minister Vahidi tells army volunteers ‘Israel has to be punished for what it has done to the Muslims in Palestine.’ Read more here-http://tinyurl.com/6nqeurz

-Iranian protesters storm UK embassy. Demonstrators break into Tehran compound during anti-British protests, burning the UK flag and forcing staff to flee. Read more here-http://tinyurl.com/7wrrwyz

-U.K. Orders Closing of Iranian Embassy in London After Attack. U.K. Foreign Secretary William Hague ordered the closure of the Iranian Embassy in London following the storming of the British Embassy in Tehran, saying the attack happened with the consent of Iran’s government. Read more here-http://tinyurl.com/7e6hmom

-Companies Urged to Share Cyber Threats With U.S. Read more here-http://tinyurl.com/bu4tu44

-U.S. Uses Cold-War Powers to Unmask Spyware. Read more here-http://tinyurl.com/7hb5jxl

-Ontario Teachers Decide to Retain Maple Leaf Sports & Entertainment Stake. The Ontario Teachers’ Pension Plan will keep its 80 percent stake in Maple Leaf Sports & Entertainment Ltd., scrapping plans to sell the company that owns Toronto’s professional hockey and basketball teams. Read more here-http://tinyurl.com/cyct4tp

-The 10 Most Outrageous Luxury Purchases In November. Read more here-http://tinyurl.com/7jwy849

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RARECOLOREDDIAMONDS.COM

-The Rare Colored Diamonds Historical Value Tracker system is the perfect tool for investors to view the potential future value of a rare colored diamond based on the current market trend of a particular type of diamond. Track the potential future value of colored diamonds here-http://tinyurl.com/6l4thaf

-Rarecoloreddiamonds.com Featured Diamond of the Week. The Diamond this week is a 1.01 carat pear cut fancy intense Pink. Call about this Diamond first thing Monday morning, after the seminar in Edmonton Monday Nov 28th, demand is very strong for all the Pink Diamonds Harold has stored in his vault. See video of the Featured Diamond here-http://tinyurl.com/d79×52c

-5 Most Expensive Diamonds Ever Auctioned. Read more here-http://tinyurl.com/bnhzwfs

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GOLD

-”Today’s central bank decisions both from the Fed, ECB and other western banks, and separately from the People’s Bank of China are unambiguously good for gold in that they’re inflationary. Gold tends to go up when the inflationary outlook worsens.” Matthew Turner, precious metals strategist at Mitsubishi

-CHART OF THE WEEK: World Gold Council Report: Investment Demand Still Climbing. Read more here-http://tinyurl.com/82d8nm4

-”Unfortunately, the fundamentals couldn’t be any worse for the US Dollar. The national debt has topped $15 trillion, with the deficit over $1.4 trillion. The time is quickly approaching when interest payments could overwhelm the government’s ability to meet obligations.

Money printing has been the historical “solution” to this problem. Lighten up on the dollar while everybody is running to it. The economy is stagnant and the debt is beyond payment. Printing is their answer. Gold should be yours.” Morris Hubbartt

-”Gold continues to do battle with the dollar bugs at the $1700 marker. The action in the $1530-$1920 price block is really the battle for $2000 gold, and there are some significant similarities with the battle for $1000 gold.” Stewart Thomson-Read more here-http://tinyurl.com/7wt8v5x

-SocGen Sees $600 Billion QE3 Starting In March 2012 Sending Gold Up Between $1900 And $8500. Read more here-http://tinyurl.com/c4quo3d

-Rick Rule: Fed Bailout of Europe Sends Gold Soaring. When asked how this will impact gold, Rule stated, “In a credit cycle where you have over-encumbered balance sheets at the sovereign level worldwide and as a consequence over-encumbered banks, it would appear to me that there is one of two outcomes. Either you inflate your way out of the encumbrance or you default your way out of it, and it would appear to me that both of those outcomes would be good for gold.” Read more here-http://tinyurl.com/csmlhhr

-John Williams of ShadowStats.com: Hyperinflation Warning, Preserve Value with Gold. Read more here-http://tinyurl.com/6tyztgd

-Alf Field Sees Gold Going to $4,500 Here’s Why. Read more here-http://tinyurl.com/bunz2bh

-Clive Maund: Gold to Profit from Economic Uncertainty. Read more here-http://tinyurl.com/6srhq26

-Marc Faber: No Free Markets, Just Government Manipulation. When asked if gold would still be his asset of choice if he was only able to choose one asset for the next ten years, Faber remarked, “Yes, I think that people misunderstand gold in the sense that they think it’s expensive. But they never look at how much international reserves increased since 1996.

By how much money supply has increased since 1996. By how much an Andy Warhol painting has increased and so forth and so on. So I don’t think that gold is particularly expensive. I think it’s just the value of paper money that has completely imploded.” Read more here-http://tinyurl.com/bnaxv6v

-Marc Faber: Be Careful, The Chinese Economy May Crash. Read more here-http://tinyurl.com/ccxd85u

-Pento: Money Printing to Cause Significant Gold Move in 2012. Read more here-http://tinyurl.com/cm5beb5

-Stephen Leeb: If Europe Implodes You Will Have QE on Steroids. Read more here-http://tinyurl.com/c2tcs7m

-John Embry: Only skullduggery explains falling gold price amid turmoil. Read more here-http://www.gata.org/node/10720

-Richard Russell: Crumbling Debt to Crush Everything in its Path. Read more here-http://tinyurl.com/cl8owjs

-Despite inflation, Europe and U.S. will monetize debt, Ben Davies tells KWN. Read more here-http://www.gata.org/node/10707

-Ben Davies: Singularity transcendent money. Read more here-http://www.gata.org/node/10703

-Chris Martenson on exponentially rising debt and rapid depletion of resources. Read more here-http://www.gata.org/node/10721

-Roubini criticizes Rickards’ book without bothering to read it. Read more here-http://www.gata.org/node/10705

-Jim Rickards: Today’s Currency War May Be Tomorrow’s Global Crisis. Read more here-http://www.gata.org/node/10711

-Chavez says Venezuela’s first repatriated gold arrives. Read more here-http://www.gata.org/node/10704

-Auerback, Naylor-Leyland cite gold suppression. Read more here-http://www.gata.org/node/10717

-Haynes, Norcini review precious metals’ week at King World News. Read more here-http://www.gata.org/node/10708

-The 26lb gold Christmas tree that’s worth £1.3million. Read more here-http://tinyurl.com/cej43ee

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SILVER

Gold to silver ratio at 50 to 1 with gold at $2,000 the silver price would be $40.00

Gold to silver ratio at 40 to 1 with gold at $2,000 the silver price would be $50.00

Gold to silver ratio at 30 to 1 with gold at $2,000 the silver price would be $66.67

Gold to silver ratio at 20 to 1 with gold at $2,000 the silver price would be $100.00

Gold to silver ratio at 15 to 1 with gold at $2,000 the silver price would be $133.33

Gold to silver ratio at 50 to 1 with gold at $2,500 the silver price would be $50.00

Gold to silver ratio at 40 to 1 with gold at $2,500 the silver price would be $62.50

Gold to silver ratio at 30 to 1 with gold at $2,500 the silver price would be $83.33

Gold to silver ratio at 20 to 1 with gold at $2,500 the silver price would be $125.00

Gold to silver ratio at 15 to 1 with gold at $2,500 the silver price would be $166.67

-”Buy physical silver. I am projecting $150 per ounce, within a timeframe of two years.” Morris Hubbartt

-James Turk: Bullish Flag Pattern to Quickly Send Silver to $70. When asked about the action in gold and silver, Turk responded, “What a great way to start the week, Eric. This move is going to catch a lot of people by surprise as evidenced by the extremely low sentiment readings. Those low readings are a clear indication that there is a lot of money on the sidelines that is waiting to jump on board.”

“That money will come into the market like a tidal wave with just a little bit more upside progress. Importantly, I think we are going to see more upside progress as we work toward the end of the year. There are two important developments from a technical perspective. The first we have already spoken about, namely the bullish flag pattern on the weekly silver chart. When silver breaks out to the upside, this flag measures to a target price of around $68 to $70.

More importantly, the jump out of the flag should happen more quickly than the $18 to $50 move we saw back in 2010 and early 2011, which took about nine months. “The other important technical point is the bullish non-confirmation between gold and silver. Silver made a new low in September, below the price reached in July. Gold, however, did not. This bullish non-confirmation is giving a clear picture that gold is ready to move higher.

If it was going to break that July low, gold would have done it by now. So taken together, these two developments are very bullish and suggest much higher prices in both gold and silver over the next few months. During a big correction like the one we’ve just gone through, a lot of weak hands get shaken out of the market. We know that has happened because of the change in open interest and also because of the smaller volumes of late.

The bottom line, Eric, is that the market is now dominated by the strong hands. The shorts have had their fun for the last six months, but now it’s time for the long to enjoy the ride. Get ready for much higher prices.” Read more here-http://tinyurl.com/7ov4f9m

-Billionaire Eric Sprott Asking Silver Producers to Save in Silver. In what could be a critical turning point for the silver market, billionaire Eric Sprott, Chairman of Sprott Asset Management, informed King World News that he is writing a letter to silver producers requesting that they store their money in silver, rather than in cash at banks. Sprott brought up the letter when asked where he sees gold and silver headed, “It’s hard to define it, who knows?

I mean if you had a printing scenario you have no idea where the price of gold goes because you have no idea how much they are going to print. If you had a total bust and people feared the banking system and started buying gold, I have no idea what they would take the price of gold to because, of course, by that time all of the currencies would almost be worthless as well.”

“All you know is that there’s only a couple of things that you have to have your money in to be safe. For example, I’m writing a letter basically suggesting to the silver producers, you know you guys have all of this money in banks, why do you have it in banks?

Put it into silver, it’s a way better asset than having a bank deposit that pays zero interest rate and you take all of the risk of the bank on. You know if enough people accept that thinking, I mean, at the margin, you bring all of those buyers in (to silver), who knows where the price is going to go? But it won’t bear any relationship to where it is today.” Read more here-http://tinyurl.com/7j3hgke

-John Embry: Look for Silver to Double in a Short Period of Time. When asked about silver specifically, Embry remarked, “I’m just wildly excited about silver. I think it’s been consolidating here between $30 and $35, after having seen $50, and the fundamentals are impeccable. I have no problem with silver doubling in a reasonably short period of time.” Read more here-http://tinyurl.com/c2gwkff

-TFMR: Ted Butler Interview on Silver. Listen here-http://tinyurl.com/cjmjmqo

-Peter Zihlmann: Silver: Buy, Hold Or Sell? Read more here-http://tinyurl.com/d4amdpp

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QE

-Central Banks Ease Most Since ‘09 to Avert Europe-Led Slump. Central banks across five continents are undertaking the broadest reduction in borrowing costs since 2009 to avert a global economic slump stemming from Europe’s sovereign-debt turmoil.

The U.S., the U.K. and nine other nations, along with the European Central Bank, have bolstered monetary stimulus in the past three months. Six more countries, including Mexico and Sweden, probably will cut benchmark interest rates by the end of March, JPMorgan Chase & Co. forecasts. Read more here-http://tinyurl.com/cowxhn4

-Bond Dealers See Fed Buying $545 Billion of Home-Loan Debt in Third Easing. The biggest bond dealers in the U.S. say the Federal Reserve is poised to start a new round of stimulus, injecting more money into the economy by purchasing mortgage securities instead of Treasuries.

Fed Chairman Ben S. Bernanke and his fellow policy makers, who bought $2.3 trillion of Treasury and mortgage-related bonds between 2008 and June, will start another program next quarter, 16 of the 21 primary dealers of U.S. government securities that trade with the central bank said in a Bloomberg News survey. The Fed may buy about $545 billion in home-loan debt, based on the median of the firms that provided estimates. Read more here-http://tinyurl.com/c5qpahh

-Fed’s Yellen Sees Scope for Further Asset Purchases to Spur U.S. Recovery. Federal Reserve Vice Chairman Janet Yellen said the central bank has leeway to spur the U.S. recovery and reduce unemployment by buying more assets or clarifying its plan to sustain record-low borrowing costs.

“The Federal Reserve has some scope for action,” Yellen said. “We are actively considering methods that we could use to provide greater clarity” on the central bank’s pledge to keep rates low through at least mid-2013, and new purchases have the potential to “flatten the yield curve.” Read more here-http://tinyurl.com/czhnr87

-Fed’s Lockhart Is ‘Skeptical’ More Bond-Buying Will Help Stimulate Economy. Federal Reserve Bank of Atlanta President Dennis Lockhart said expanding securities purchases is unlikely to give a sufficient boost to U.S. growth, without ruling out the strategy or other easing options.

“I am skeptical that further asset purchases will produce much gain in terms of increased economic activity,” Lockhart, who votes on monetary policy next year, said in a speech in Atlanta. “I don’t believe further bond purchasing by the Fed is a potent policy option given the set of circumstances we currently face.” Read more here-http://tinyurl.com/d8tq7ja

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SOVEREIGN DEBT

-Moody’s Says All Euro-Region Sovereign Ratings Threatened by Debt Crisis. Moody’s Investors Service said the “rapid escalation” of Europe’s debt and banking crisis is threatening all of the region’s sovereign ratings. Credit risks will continue to rise without measures to stabilize markets in the short term, the ratings company said in a statement. Read more here-http://tinyurl.com/7y5rdcf

-Hungary Debt-Grade Cut to Junk Boosts Need for IMF as Rate Pressure Rises. Hungary must redouble efforts to obtain International Monetary Fund aid and the central bank should raise rates to ease financing risks after Moody’s Investors Service cut the country’s credit grade to junk, said fund managers from Budapest to London. Read more here-http://tinyurl.com/bmdyemt

-Belgium’s Credit Rating Lowered to AA by S&P on Bank Rescues, Politics. Belgium’s credit rating was cut one step to AA by Standard & Poor’s, which said bank guarantees, lack of policy consensus and slowing growth will make it difficult to reduce the euro region’s fifth-highest debt load. Read more here-http://tinyurl.com/cvqaox9

-Obama says U.S. willing to help Europe in crisis. President Barack Obama said at a U.S.-European Union summit that the United States is willing to do its part to help resolve the European debt crisis. Obama said the European crisis is a “huge issue” for the U.S. economy and that the United States has a stake in its successful conclusion. European Council President Herman Van Rompuy said slower global growth is not solely due to the European Union and that other nations must act. Read more here-http://tinyurl.com/6mh63ce

-Monti Says Merkel, Sarkozy Agree Italy Default Would Lead to End of Euro. German Chancellor Angela Merkel and French President Nicolas Sarkozy agreed with Prime Minister Mario Monti that Italy succumbing to the region’s debt crisis would lead to the end of the euro, Monti’s office said. Read more here-http://tinyurl.com/83hczf7

-Greek Aid of $7.7 Billion Is Said to Be Cleared by Euro Finance Ministers. Euro-area finance ministers approved a 5.8 billion-euro ($7.7 billion) loan to Greece under last year’s bailout after eliciting budget-austerity pledges from Greek political leaders backing a unity government, a European official said. Read more here-http://tinyurl.com/cck3xt4

-Greek Bank Withdrawals Accelerated Amid Crisis. Greek political instability spurred an acceleration of bank withdrawals, with the decline stemmed by the appointment of a new government this month. Greek banks saw an outflow in deposits of about 13 billion euros to 14 billion euros ($18.7 billion) in the two months to the end of October, said George Provopoulos, the head of the central bank and a member of the European Central Bank Governing Council.

Deposits totaled 183.2 billion euros at the end of September. “One could say these two, two and a half months have been the worst for deposits since the start of the crisis,” Provopoulos told lawmakers in Athens. Read more here-http://tinyurl.com/7crtvhl

-Prepare for riots in euro collapse, Foreign Office warns. British embassies in the eurozone have been told to draw up plans to help British expats through the collapse of the single currency, amid new fears for Italy and Spain. Read more here-http://tinyurl.com/d7t3vwt

-Pimco’s Gross Says Europe Won’t Escape Debt ‘Straitjacket’ for Years. Investors should recognize that Europe’s problems are global and it will be years before nations in the region can escape from their “straitjacket” of debt, Pacific Investment Management Co.’s Bill Gross said. With global growth likely stunted for years and interest rates kept artificially low. Read more here-http://tinyurl.com/cptuep9

-European Banks Frantically Trying To Dump $7 Trillion Of Crap Assets But No One Will Buy Them. Read more here-http://tinyurl.com/c6xlxlk

-There’s An Easy, Fair Solution To The Global Debt Crisis Too Bad No One Ever Talks About It. Read more here-http://tinyurl.com/cvxcoej

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U.S. DEBT-DEFICIT

-U.S. Rating Outlook Cut to Negative by Fitch After Deficit Committee Fails. The U.S. lost its last stable outlook from the three biggest credit-ranking companies after Fitch Ratings lowered the nation to negative following a congressional committee’s failure to agree on deficit cuts. Read more here-http://tinyurl.com/btm944y

-U.S. States Face $40B in Deficits in ‘13: Survey. U.S. states must tackle at least $40 billion in budget gaps in the year beginning in July as federal stimulus funds decrease and expenses rise, according to a survey released today by the National Governors Association and the National Association of State Budget Officers. Read more here-http://tinyurl.com/cezb4ba

-Secret Fed Loans Gave Banks $13 Billion. The Federal Reserve and the big banks fought for more than two years to keep details of the largest bailout in U.S. history a secret. Now, the rest of the world can see what it was missing. The Fed didn’t tell anyone which banks were in trouble so deep they required a combined $1.2 trillion on Dec. 5, 2008, their single neediest day.

Bankers didn’t mention that they took tens of billions of dollars in emergency loans at the same time they were assuring investors their firms were healthy. And no one calculated until now that banks reaped an estimated $13 billion of income by taking advantage of the Fed’s below-market rates. Read more here-http://tinyurl.com/7qtcwgm

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REAL ESTATE

-Home Prices in 20 U.S. Cities Fall More Than Forecast, Case-Shiller Says. Residential real estate prices dropped more than forecast in the year ended September, showing the industry at the center of the 2008 financial crisis continues to struggle. The S&P/Case-Shiller index of property values in 20 cities dropped 3.6 percent in September from the same month in 2010 after decreasing 3.8 percent in the year ended August, the group said today in New York. Read more here-http://tinyurl.com/caywk4y

-Fewer New Homes Purchased Than Forecast. Builders sold fewer new houses in the U.S. than forecast in October, delaying a recovery as the industry heads for the weakest year on record. Sales increased 1.3 percent to a 307,000 annual pace, data from the Commerce Department showed in Washington. Read more here-http://tinyurl.com/7g3bq7a

-Pending Sales of U.S. Existing Homes Up 10.4%. The number of Americans signing contracts to buy previously owned homes rose more than forecast in October as buyers took advantage of falling prices and low borrowing costs. The index of pending home sales increased 10.4 percent, the biggest gain since November 2010, after falling 4.6 percent the prior month, figures from the National Association of Realtors showed in Washington. Read more here-http://tinyurl.com/7yujpdh

-As Home Prices Sink, Home Ownership Heads to New Lows. Home prices across the nation are now right back where they were at the beginning of 2003. All that was gained is largely now lost, and the effect on home ownership could continue for decades. Read more here-http://tinyurl.com/bo6emhz

-Underwater homes ease modestly in Q3: CoreLogic. The number of U.S. homeowners who are underwater on their mortgages decreased modestly in the third quarter, though levels remained high, data analysis company CoreLogic said. The number of properties with so-called negative equity in which the amount owed on the mortgage exceeds the property’s value was 10.7 million, or 22.1 percent of all residential properties with a mortgage.

That is a slight decrease from 10.9 million, or 22.5 percent, in the second quarter, CoreLogic said. “Although slightly down, negative equity remains very high and renders many borrowers vulnerable when negative economic shocks occur, such as job loss or illness,” Mark Fleming, chief economist at CoreLogic, said in a statement.

An additional 2.4 million borrowers fell into the near-negative equity camp in the third quarter, defined as those less than 5 percent equity. Hard-hit Nevada had the highest underwater rate with 58.3 percent of mortgages upside down. The top five was rounded out by Arizona, Florida, Michigan and Georgia. Read more here-http://tinyurl.com/cvjhy5r

-Shanghaied Home Buyers Take to Street. Read more here-http://tinyurl.com/dx8tbul

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World Financial Report – December 1st, 2011
posted by Rare Colored Diamonds on Thursday, December 1, 2011