Bloomberg:
- Germany, France Reconnect in a Push for Crisis Solutions. Germany and France agreed to drive ahead measures on closer European integration in a renewed show of unity by the region’s two biggest economies to fix the crisis in the euro zone. German Finance Minister Wolfgang Schaeuble, speaking after talks in Berlin today with his French counterpart, Pierre Moscovici, said the two countries will create a working group to advance European Union cooperation on banking union, fiscal union and the strengthening of monetary union.
- German Business Confidence Falls for a Fourth Month. German business confidence fell for a fourth straight month in August as the sovereign debt crisis curbed growth in Europe’s largest economy. The Ifo institute in Munich said its business climate index, based on a survey of 7,000 executives, dropped to 102.3 from 103.2 in July. That’s the lowest reading since March 2010. Economists predicted a decline to 102.7, according to the median of 37 forecasts in a Bloomberg News survey.
- Drought-Driven Food Costs May Damp Consumer Sentiment: Economy. The worst U.S. drought in at least 50 years may restrain consumer confidence and spending as it pushes Americans’ grocery bills higher later this year. Food prices will increase an average 4 percent annual rate in the nine months ending June 2013, up from 1.5 percent currently, said Michael Feroli, chief U.S. economist at JPMorgan Chase & Co. in New York. That may trim real disposable incomes by 0.3 percentage point from the fourth quarter of 2012 through the first half of next year and reduce spending by a similar amount, he estimates. The projected food-price increase will squeeze budgets of households already contending with a 13 percent gain in gasoline prices since early July and unemployment that is stuck above 8 percent three years into the economic recovery. Consumer sentiment has yet to return to pre-recession levels, confidence gauges show. “Energy is hitting us now, food is going to hit us later,” Feroli said. “It will be a headwind for consumers. It’s going to damp people’s perceptions of the economy.”
- Jackson Hole May Disappoint Investors Primed for Stimulus. Federal Reserve Chairman Ben S. Bernanke -- returning this week to the scene of a 2010 speech that foreshadowed a second round of quantitative easing -- probably will disappoint investors looking for him to signal new stimulus. Bernanke probably won’t use his Aug. 31 speech at the Fed’s annual symposium in Jackson Hole, Wyoming, to suggest a third round of bond buying is at hand, according to economists including Michael Feroli and James O’Sullivan. Members of the Federal Open Market Committee -- who meet next on Sept. 12-13 -- are closely monitoring unemployment and other data and have been divided about whether to spur expansion.
- Dollar Loses Hedge Fund Bulls as Risk Drops at G-10 Nations. Hedge funds and large speculators are abandoning bets on a stronger dollar at the fastest pace ever. Net bets that the world’s reserve currency will weaken against eight major peers increased to 131,512 contracts as of Aug. 21, data from the Commodity Futures Trading Commission show. That compares with about 311,000 contracts betting on an advance on June 5, the biggest reversal on record.
- Gulf Coast Braces for Isaac With Hurricane Katrina in Mind. Almost seven years to the day that Hurricane Katrina ravaged New Orleans, scarring a region and a nation, Gulf Coast residents are deciding whether to evacuate or ride out another storm. ropical Storm Isaac is forecast to strengthen into a hurricane over the eastern Gulf of Mexico, closing oil and natural-gas production sites and threatening Louisiana, Mississippi, Alabama and Florida.
- GOP Gathers to Sell Romney to Voters. The GOP's big push to sell Mitt Romney to the American people slowly came to life Monday, after the Republican National Convention's main speeches were delayed until Tuesday amid concerns over Tropical Storm Isaac, which is churning through the Gulf of Mexico toward the northern Gulf Coast.
- Streaming Coverage: Hurricane Isaac.
- Yuan Risks a New First: A Down Year. Investors, long enamored with the yuan, have increasingly soured on the Chinese currency and are boosting their bets that it will decline against the dollar in the coming months. In the past few weeks, the offshore forwards market in Hong Kong has signaled expectations that the yuan will fall 1.4% in a year, rather than the 0.9% decline expected in early July. These derivatives, which aren't traded on an exchange, are used by exporters and speculators to bet on where the currency will trade.
- Shipper China Cosco Faces a Sea of Red. Industrywide woes and Cosco's own ill-timed expansion have damaged its financial standing, limiting its ability to nurture new business and to order additional ships. Should Cosco report a second consecutive annual loss, after last year's loss of 10.5 billion yuan ($1.65 billion), it also would risk being put on the Shanghai Stock Exchange's "special treatment" list. That could limit the daily trading movement of Cosco's shares to 5% from the standard 10%. If losses extend into a third year, the company automatically would be delisted.
- Spain's 2011 Economy Weaker Than Thought.
- Oil runs out of steam; gasoline up on storm. Gasoline held to gains. The commodity for September delivery (US:RBU2) rose 7 cents, or 2.2%, to $3.14 a gallon.
- Fed’s Pianalto on fence regarding QE. A swing voter of the Federal Reserve on Monday took a cautious approach to the burning question of the day: whether the central bank should engineer another round of asset purchases to stimulate the sluggish economy.
- Internal discord leaves ECB’s threats toothless. Commentary: Bundesbank’s Weidmann undercuts Draghi. A central bank’s ability to intimidate the financial markets through active, targeted intervention is directly proportional to its ability to deliver on promised action.
CNBC.com:
- New Euro Bailout Fund Could Fall Short. The new fund set up to bail out struggling euro zone economies may face a 150 billion euro ($189 billion) shortfall if Spain and Italy need a full bailout program before the end of 2014, according to analysts at Credit Suisse.
Business Insider:
- REPORT: Almost Every Household Is Worse Off Now Than It Was Three Years Ago.
- British Tourist Is Stunned By How Bad Things Are In Italy.
- Nomura's Geopolitical Guru Can't Stop Worrying About These 10 Issues.
- The Epic Anchovy Price Spike Is Not To Be Ignored.
- Unilever Says 'Poverty Is Returning To Europe' And That It's Now Selling Products The Way It Does In Emerging Markets.
- Japan Plans To Buy The Disputed Islands And Infuriate China.
- The US Garbage Indicator Is Telling Us Q3 GDP Stinks. (graph)
- Mario Draghi Needs Greece Out Of The Eurozone.
Zero Hedge:
- "Lulled To Sleep".
- "This Is Just The Beginning" As LIBOR-Manipulation Liabilities May Top $176bn.
- The Tempest Has Left The Teapot.
- History May View ECB’s Draghi As "Currency Forger Of Europe".
NBC:
Reuters:
- Copper weakens as investors await global stimulus.
- ECB's Asmussen seeks to take heat out of bond debate. The European Central Bank will tailor its new bond-buying plan to dispel any concerns that it funds governments, a top ECB policymaker said on Monday in remarks aimed at assuaging the angst of Germany's Bundesbank. The new programme will ensure countries whose bonds the ECB buys do not soft-peddle reforms, board member Joerg Asmussen said. He did not say when the bank would begin buying but made clear the plan would go ahead despite Bundesbank opposition. "Under the framework of the new programme, the ECB will only buy bonds with short maturities," Asmussen said in the text of a speech for delivery in Hamburg, though he added that the ECB was still working on technical and operational details of the plan. The ECB is being forced to take a greater role in fighting the euro zone crisis while governments negotiate legal and political hurdles to coordinating a longer-term response, but the Bundesbank wants to limit the scope of central bank action.
- France may need to trim 2013 growth forecast -PM. French Prime Minister Jean-Marc Ayrault said on Monday that the government's forecast for economic growth of 1.2 percent in 2013 may have to be revised downward slightly. Most economists are much more bearish on the French economy than the government, seeing gross domestic product (GDP) more likely to grow between 0.5 and 1.0 percent next year following stagnant growth this year.
- Army bombardment on eastern Damascus kills 62-opposition. Syrian army shelling and helicopter attacks on suburbs of the capital Damascus killed at least 62 people on Monday, opposition activists said. Eleven of the dead were killed in the district of Jobar, where activists said a Syrian helicopter was downed earlier in the day, they said. Five of the Jobar victims were captured in Dayer Jdayeh Street and summarily executed by security forces, and the others died when their homes were hit, opposition activists said.
- Cutting excess-reserves rate would not help-Fed economists. Economists at the Federal Reserve Bank of New York have poured cold water on a plan to lower interest rates on some bank deposits, an idea that had gained favor among a couple of policymakers at the U.S. central bank.
- IBM(IBM) enters HR web applications market with Kenexa(KNXA) buy. IBM Corp will buy Kenexa Corp for about $1.3 billion to enter the human resources software market in a move that would likely increase competition with Oracle Corp and SAP AG who recently bought into the sector.
Telegraph:
- Death in Venice becomes cheaper as bidding war breaks out between funeral operators. The economic crisis in Italy has sparked a bidding war between Venetian funeral operators in the lagoon city.
- Is this the end for Australia's mining boom? “The commodity price boom is over and anyone with half a brain knows that.”
Haaretz:
- Netanyahu: Israel will strike Lebanese state in case of Hezbollah provocation. Haaretz has learned that Netanyahu conveyed this message to the Lebanese government through a Western diplomat he met in Jerusalem several weeks ago.
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