American Markets- Leading News

Parsons Blames Glass-Steagall Repeal for Crisis

http://www.bloomberg.com/news/2012-04-19/parsons-blames-glass-steagall-repeal-for-crisis.html

U.S.stocks Rise on Earnings Reports, Europe Optimism

U.S. stocks rose, snapping a two- day decline for the Standard & Poor’s 500 Index, as profits from companies including Microsoft Corp. and General Electric Co. (GE) beat estimates and German business confidence improved.

Microsoft, the world’s largest software maker, jumped 4.2 percent while GE added 1.6 percent. Schlumberger Ltd. (SLB) rallied 5.8 percent after its first-quarter profit beat projections. SanDisk Corp. (SNDK) lost 14 percent after forecasting sales that were less than some analysts estimated.

The S&P 500 gained 0.4 percent to 1,381.88 at 9:46 a.m. New York time, after dropping 1 percent over the past two days. The Dow Jones Industrial Average rose 70.16 points, or 0.5 percent, to 13,034.26 today.

“On the back of some weaker recent economic data, the earnings story continues to showcase that companies can ring out some profits here,” James Dunigan, who helps oversee $112 billion as chief investment officer in Philadelphia for PNC Wealth Management, said in a telephone interview. “With the constant noise in the background of Europe we seem to be focusing more on the domestic story, at least today. That just gives more credence to the fact that the recovery continues to be in place.”

Profits for the 94 companies in the S&P 500 that have reported results so far are beating estimates by 8.5 percent, according to data compiled by Bloomberg. The benchmark gauge for U.S. equities has risen 10 percent in 2012, even after the index lost 0.6 percent yesterday as home sales fell last month and jobless claims were more than forecast last week.

German Confidence

A report today showed German business confidence unexpectedly increased for a sixth month in April, adding to evidence that Europe’s largest economy can weather the sovereign-debt crisis.

The Group of 20 will announce new funding for the International Monetary Fund’s European reserves that will “satisfy” requests from Managing Director Christine Lagarde, Russian Deputy Finance Minister Sergei Storchak said. Lagarde, who has called Europe the “epicenter” of risks to the world economy, is seeking more than $400 billion in new funding from member countries.

Microsoft (MSFT) rose 4.2 percent to $32.30. The Redmond, Washington-based company reported net income of 60 cents a share, exceeding the 57-cent average estimate of analysts surveyed by Bloomberg amid better-than-expected sales of Windows and Office software for businesses.

General Electric Co. rose 1.6 percent to $19.45. The maker of aircraft engines and provider of financial services beat analysts’ earnings estimates as profit gains at its energy business, its largest industrial division, outpaced finance for the first time in two years.

Drilling Rigs

Schlumberger, the world’s largest oilfield-services provider, gained 5.8 percent to $73.85. The world’s largest oilfield-services provider said first-quarter profit rose 38 percent as the number of U.S. rigs drilling for oil reached a record.

Advanced Micro Devices Inc. (AMD) climbed 1.1 percent to $8.06. The second-largest maker of processors for personal computers said second-quarter sales will grow about 3 percent from the first three months. That indicates revenue of about $1.63 billion, compared with the $1.59 billion average analyst estimate compiled by Bloomberg.

Honeywell International Inc. (HON), the maker of digital flight controls and work boots, rallied 4 percent to $60.33 after the company posted a first-quarter profit that beat analysts’ estimates and boosted its full-year forecast.

McDonald’s Corp. added 2 percent to $97.15. The world’s largest restaurant chain reported a 4.8 percent gain in first- quarter profit as new menu items such as Chicken McBites attracted U.S. consumers.

SanDisk, which makes memory chips used in mobile devices, declined 14 percent to $35 after giving a second-quarter sales forecast that fell short of some analysts’ estimates. Chip production at SanDisk and its rivals is outpacing demand, causing prices to fall, Chief Executive Officer Sanjay Mehrotra said on a conference call with analysts yesterday. Some of the company’s customers also ordered fewer chips for mobile phones than SanDisk had predicted, he said.

http://www.bloomberg.com/news/2012-04-20/u-s-stock-index-futures-rise-microsoft-gains-in-germany.html

Rising Fears That Recovery May Once More Be Faltering

WASHINGTON — Some of the same spoilers that interrupted the recovery in 2010 and 2011 have emerged again, raising fears that the winter’s economic strength might dissipate in the spring.

n recent weeks, European bond yields have started climbing. In the United States and elsewhere, high oil prices have sapped spending power. American employers remain skittish about hiring new workers, and new claims for unemployment insurance have risen. And stocks have declined.

There is a “light recovery blowing in a spring wind” with “dark clouds on the horizon,” Christine Lagarde, managing director of the International Monetary Fund, said Thursday, at the start of meetings here that will focus on Europe’s troubles and global growth. Ms. Lagarde implored world leaders not to become complacent.

Forecasters have said that the trends point to a moderation of economic growth in the United States, but they still expect the recovery to continue this year. The slowdown in part reflects an unusually warm winter, which pulled forward economic activity, making January and February seem artificially good and perhaps making recent weeks look worse than they truly were.

Still, the breadth of the recent weakening of activity shows that the economy remains fragile, as is typical in the years following a financial crisis…..

http://www.nytimes.com/2012/04/20/business/economy/concerns-form-backdrop-for-economic-meetings.html?_r=2&ref=business

Greasy Goldman Sachs Facing Yet Another Insider Trading Probe

http://www.reuters.com/article/2012/04/19/us-usa-crime-goldman-idUSBRE83I1GQ20120419

FED Gives Banksters 2 More Years to Rig Gold Markets, and Profit Thereof

http://www.washingtonpost.com/business/markets/fed-clarifies-that-banks-have-2-years-to-comply-with-rule-limiting-trading-for-own-profit/2012/04/19/gIQASqelTT_story.html

YPF: To privatize or to nationalize… That is the Question!

Published: 19 April, 2012, 20:02

AFP Photo / Juan Mabromata

AFP Photo / Juan Mabromata

TAGS: Oil, Conflict, South America, UK, Europe, Resources

 

While Argentineans went into “nationalistic flag-waving mode” on news the YPF oil company will be nationalized, and its former owner Repsol, Spain and the West went furious, there are  many hidden currents that led to the outcome.

What’s this really all about?

Firstly, we should not be led astray by President Kirchner’s “nationalist” gestures, because in order to expropriate and nationalize YPF today, it first had to be privatized. That happened in 1992 under Carlos Menem’s Presidency – orchestrated by Finance Minister Domingo Cavallo – within the scope of Argentina’s capitulation to the Global Power Masters.

At that time, in order to sell YPF to Spain’s Repsol Mr Menem had to bring on board Argentina’s eight oil-producing provinces, one of which is Santa Cruz Province down south in Patagonia whose Governor at the time was Néstor Kirchner and his wife (and present president) Cristina was Congressional Deputy for Santa Cruz.

The Kirchners agreed to approve the predatory privatization of YPF if the Menem government paid Santa Cruz Province $654 million in back-logged YPF oil royalties. Part of Argentine public opinion has been pressing for a full-scale investigation into what the Kirchner’s did with those hundreds of millions dollars in YPF monies but – alas! – to no avail: the Argentine courts, local NGO’s, the local Ombudsman, Anti-Corruption Agency and mainstream media won’t go near the subject!

The privatization of YPF coincided with the Kirchner’s super-meteoric-political careers, and their sudden, enormous personal wealth.

Suspected partial whitewashing/recycling of those ill-gotten funds may have come at the end of 2007 when the Kirchner’s – in sync with Repsol who after years of exploiting YPF wanted to step back a bit because of the huge investment shale oil exploitation would require – arranged for 14.9% of YPF stock to be sold to local banker, financier and Kirchner associate Eduardo Eskenazi.

In February 2008, a further 10.1% was acquired by Mr Eskenazi bringing his total holdings in YPF to 25%: a great deal for him (and his partners) as he’s been paying for his “investment” with on-going YPF profits.

Britain ’s Spanish “amigos…”

Many observers in Argentina and elsewhere link Repsol to the UK; more specifically with BP for which it may have acted as a front company in order to elegantly engineer its privatization in 1992.

Clearly, it would have looked awful for Argentina’s crown flagship oil company YPF – a symbol inspiring nationalist fervor – to be sold off to “those British pirates usurping our Falkland/Malvinas Islands”!

So, how convenient indeed for Britain’s Spanish amigos to step in; Spain is, after all, Argentina’s “mother country”, right?

Clearly, Spain played a key geopolitical role in Argentina’s “privatization process”, no doubt reflecting traditional close links between the Spanish Bourbons and English Mountbattens.

At the time, the “leading case” for privatizations was Spain’s flag-carrier airline Iberia “buying-up” Aerolineas Argentinas; a truly weird “privatization” considering Iberia was a state-owned company!  Anyway, Iberia promptly destroyed Aerolineas Argentina by emptying it out of spares, turbine engines, aircraft and state-of-the-art flight simulators.  A bad omen for YPF…

Who really owns YPF?

With Cristina Kirchner’s expropriation, YPF ownership will be: 26% (Argentina’s Federal Government); 25% (Argentina’s eight oil-producing provinces); 24.5% (local Eskenazi Financial Group closely linked to Kirchner’s entourage), 6.0% (Lazard Bank); 5.0% (Eton Park: Goldman Sachs, Minsich, Rosemberg); 2.0% (Werthein Group) and 6.5% (Repsol).

Interestingly, that still leaves 44% in the hands of entities linked to international finance and aligned to their geopolitical appetites over Argentina,

YPF: Repsol’s “Cash Cow”

Kirchner’s official reason for expropriating YPF is Repsol’s stripping the company of its financial assets, lack of investment and insufficient production and exploration, thus forcing Argentina to import oil.  The presidential decree refers to “Repsol’s predator strategy in its control of YPF which has had serious consequences for Argentina’s national economy, which tends to worsen if the Government does not take measures to control the Company”.

That is true: Repsol did impose on YPF a “strategy of reducing production” generating for the first time in seventeen years an oil and gas trade deficit in 2011 of over $3 billion.  In 1997, YPF accounted for 42% of Argentina’s oil and 35% gas supply; in 2011, that had fallen to 34% oil and 23% gas.

As a Reuters dispatch dated 16th April further explains, Repsol made the “disastrous decision” of merging with YPF in 1999 because in 2001/2 Argentina fell into full-scale financial collapse.  That “ turned YPF from Repsol’s crown jewel into an albatross, though it still provided substantial cash flows for reinvestment elsewhere in the world.   Repsol’s use of YPF as a cash cow has rankled the government and a partial sell-off of the company has not helped matters.” Thus, “Repsol preferred to milk the company for dividends rather than invest”.

Nationalization: Why Now?

As with all complex issues, this is not a clear-cut matter.  However, weighing all the factors one can say that Ms Kirchner’s decision to nationalize and expropriate YPF is the right decision (because Argentina does need to exert sovereign control over its oil reserves and revenues),  taken by the wrong people (because the Kirchner administration are specifically accountable for aiding the catastrophic and fraudulent privatization of YPF to Repsol twenty years ago, for which they received very handsome sums of money), and for the wrong reasons (Kirchner needs to access YPF cash and collateral so that Argentina can continue servicing its increasingly unpayable sovereign debt, which continues to balloon thus placing Argentina under growing Global Money Power control).

Bowing to mega-banker demands, rather than making a full investigation into Argentina’s sovereign debt – rooted in the illegal military-civilian regime that usurped power from 1976 to 1983 a large chunk of which can be declared “Odious Debt” under international law – the Kirchners prefer to pay and pay.

As funds dried up, they first nationalized Pension Funds in 2008 and since then increasingly use Central Bank Reserves; again, two sovereign measures that are right, taken by the wrong people and for the wrong reasons.

Playing with Fire?

What Cristina Kirchner and her supporters seem to forget is that if you mess around with the UK, US, and Europe over oil that can get you into a whole lot of trouble.

Lately, she’s raised her shrill voice over illegal UK exploitation of Falkland/Malvinas Island oil; now she’s nationalized YPF.  All, at a time when the Western Powers have made very clear their decision to fully militarize their oil control and access strategies worldwide (ask Iraq, Libya, Afghanistan or Iran…).

At the same time, however, Ms Kirchner sends the UK and the Global Power Masters loud and strong signals that Argentina is fully unarmed and would never even dream of having a strong dissuasive military: music to British, American and European ears!!

So… either she’s extremely naïve or… might she be playing a much more subtle role within a grander Global Power Elite strategy, that always looks for “excuses” to militarily intervene wherever there are oil resources?

­Adrian Salbuchi for RT

­Adrian Salbuchi is a political analyst, author, speaker and radio/TV commentator in Argentina. www.asalbuchi.com.ar

http://rt.com/news/ypf-privatize-nationalize-question-477/

 

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3 Responses to American Markets- Leading News

  1. vino says:

    HE WHO PAYS THE PIPER MAKES THE RULES… bric mantra accompanying big check to bail out the IMF and europe

    Brazil’s Mantega Urges Reduction of Europe’s IMF Voting Power
    By Andre Soliani on April 20, 2012

    http://www.businessweek.com/news/2012-04-20/brazil-s-mantega-urges-reduction-of-europe-s-imf-voting-power

    Brazil’s Finance Minister Guido Mantega urged International Monetary Fund members to grant emerging markets a greater say in management of the lender, saying that the overrepresentation of some European countries no longer reflects the balance of global economic power.

    Mantega, in a speech that will be delivered tomorrow at the IMF meetings in Washington, calls for implementation of a 2010 reform of the quota shares, which determine a nation’s strength within the fund, to better reflect the changing balance of the world economy in favor of nations like Brazil, Russia, India and China — the so-called BRIC nations.

    “Brazil’s economy is larger than that of any European country but Germany and France,” Mantega said, according to the text of his speech distributed in advance. “Yet, Brazil’s calculated quota share is equivalent to that of the Netherlands and smaller than those of Spain, Italy and the United Kingdom.”

    Earlier today, Mantega said that Brazil would insist on emerging markets having a greater voice in the institution as a condition to joining an international effort to increase the fund’s resources by more than $400 billion.

    He urged quotas to be calculated based on the gross domestic product of members, instead of a formula that takes into account the openness of their economies.

    “The quota of Spain, amazing as it may seem, is larger than the sum total of the quotas of all forty-four Sub-Saharan African countries,” Mantega said. “These and other anomalies are a product” of the current formula.

  2. zephyrglobalreport.com says:

    i think it is just goldman sachs and not the ‘market’. in

  3. Arb says:

    But is this why the penguin and Sollie are under such pressure? And ross.
    Does the market know best, more accurate discounted pol risk?
    Or just an excuse in the powerz long game and increasingly successful game to take under these world class assets?

    I am thinking mch of penguins and no good’s last financings were heavily shorted ahead. No reason for wall st money to get trapped and destroyed.

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