Ireland seizes $7 billion from its Pension Fund to boost employment

June 13, 2011 by · Leave a Comment
Filed under: Global News 

The situation looks dire in Ireland.  They have raided their pension reserve fund to use as a stimulus fund.  It is in my opinion that they should not of bailed out the massive real estate debts that were built up during the bubble.  Yes, there would of been major dishevel for a short amount of time but then they would not have the commitments they have now that is forcing austerity and slowing the recovery.  For some reason we are fixed on always keeping prices higher and not seeing the benefits that lower prices that (equates to higher value) brings when you have savers with capital that will sniff out value.

Business Insider – The government will  use the last €5 billion in the National Pensions Reserve Fund (NPRF) to help create employment although it will need approval from the International Monetary Fund (IMF) and Europe before doing so.

Read more

Obama administration closely monitoring Dubai debt crisis

November 29, 2009 by · Leave a Comment
Filed under: Global News 

The White house and most of the world are looking intently at the looming situation in Dubai after the announcement from Dubai World that they will be postponing almost $60 billion dollars in scheduled bond payments.  Reaction on Friday was severe compared to what is usually a light trading day.  The dollar fell on this announcement and stocks sold off worldwide.

This does not bode well for the recovery that all central banks are trying to engineer and this could be the catalyst that starts the correction many investors have been waiting for after this major run-up in stock prices.  If these types of announcements continue in other parts of the global economy, it is going to make banks even more reluctant to lend which is the lifeblood of any glowing economy.  This week will be very important to watch in the markets.

The Obama administration said Friday that it was monitoring developments in a looming debt default by the Persian Gulf emirate of Dubai, whose efforts to fend off creditors sent stocks skidding in the United States and around the globe amid fears of new bank losses.

The Dow Jones Industrial Average opened down by more than 200 points during Friday’s abbreviated session, recovering slightly later in the day as analyst reports suggested that U.S. banks had little exposure to Dubai, one of seven sheikdoms that compose the United Arab Emirates.

Around the world, fears focused on the danger that a massive debt default by Dubai could trigger similar defaults elsewhere. Such defaults in Mexico, Russia and Argentina over the past two decades proved contagious.

“The Treasury Department is monitoring the situation,” said a White House official, who spoke only on the condition of anonymity because she wasn’t authorized to talk about the issue for publication.

Source: Miami Herald

China foreign debt rises to $442 billion

December 27, 2008 by · Leave a Comment
Filed under: Global News 

Debt worldwide is rising and will continue until the economy stabilizes and confidence is restored.  One item that would help this process is letting market forces choose winners and losers so that the right people prosper and the correct lessons are set.  Currently, people can  not plan for the future because of the jeopardy that the rules will continue to drastically change and they could be hurt by their decisions.  Once piece of evidence is the rush to U.S. treasuries even when your getting a negative return on your money in this environment.  

News:

China’s foreign debt grew at a slower pace in the third quarter, the country’s foreign exchange regulator said on Friday, reflecting a slowdown in investment from abroad amid the weaker global economy.

China’s foreign debt reached $442.0 billion (300 billion pounds) at the end of September, up 3.4 percent from $427.4 billion at the end of June, the State Administration of Foreign Exchange (SAFE) said on Friday.

Read more

South Korea to guarantee banks’ foreign currency debts

October 19, 2008 by · Leave a Comment
Filed under: Global News 

More evidence of this global problem.  I am surprised to see this article, I thought the Fed offered unlimited currency swaps for countries needing dollars.  With S. Korea having the 6th largest foreign currency reserves, it looks like they are working on getting through this crisis under there own power.  If so, that would be the prudent approach to keep its credit rating in tact.

Release:

 

South Korea announced measures Sunday to shore up its banks by guaranteeing their external debt and pumping more money into the financial system amid the global credit crisis.

The government said it will provide up to $100 billion to secure banks’ maturing foreign currency debt for three years on loans taken out from Oct. 20 this year until June 30, 2009.

Read more