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The index of leading economic indicators rose in Switzerland in December

The index of leading economic indicators from KOF reached in December, a mark 1,68. Positive growth rate observed over the past several months, gradually gives way to stagnation.
The index rose in December by 0.06 points compared with the previous month and was on the mark of 1.68 points.
The published value of the indicator suggests that Switzerland's GDP growth will show up this year. However, the positive trend will likely come to naught in the next few months.

The index of business activity in Chicago reached a record

According to the Institute of Management, Corporate Procurement Services in Chicago, business activity in the region in December reached a record high for the past 16 months.
The index of business activity rose to 60.0% compared with 56,1% in November. Rate was at a record high in August 2008 and far surpassed the forecasts of experts.
Note that in January this year the index stood at 31.4%. The value of the above 50% indicates that business conditions improved in most companies in the region.

Trade Assistant 1.14b MT4 Indicator

This indicator helps you trade by giving you two signals on multiple timeframes. It bases it's recommendations on RSI and stochastics.

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Trade Assistant 1.14b.mq4

Complex Common MT4 Indicator

Indicators are based on the idea of identifying the imbalance of the five currencies.

They work exclusively with the currencies USD, EUR, GBP, CHF, JPY, and only with currency pairs EURUSD, EURGBP, EURCHF, EURJPY, GBPUSD, GBPCHF, GBPJPY, USDCHF, USDJPY, CHFJPY.


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Complex Common.mq4

Price Alert MT4 Indicator

It will alert at another place as soon as you quickly move it using the mouse.


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Price Alert.mq4

Scotia Capital expects growth in the euro / dollar in the next year

According to currency analysts Scotia Capital, asset diversification will have a negative pressure on the dollar, which resulted in the growth of pair euro / dollar in 2010 to a mark of 1.60. As noted in the bank, the single European currency continues to slowly strengthen against the U.S. dollar. The bank's strategy believe that next year's asset diversification to the detriment of the dollar will continue, and the euro / dollar in three months to grow to a level of 1.52, after half a year will reach 1.55, and the end of 2010 will be traded at 1.59. Currently, the euro / dollar was at around 1.4355.

Tabelka Kontrolna MT4 Indicator

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Tabelka Kontrolna.mq4

Japan data ease double-dip fears

Strong economic data from Japan, published on Monday, helped ease concerns about the second fall of the economy and raised the Tokyo stock market to 14-month high.

Last month, industrial production increased with the highest rate since May, according to the Ministry of Economy, Trade and Industry. The November increase of 2,6% compared with the October to 0.5% was the ninth consecutive month of growth.

Manufacturers surveyed by the Ministry stated that they expect output growth to 3.4% in December and 1.3% in January.

Retail sales, meanwhile fell by 1% in November compared with a year earlier, but this figure is less than predicted Reuters (1,2%).

Strong data, which came after Japan reported on the 8th month of export growth due to steady demand in Asia, the Nikkei 225 index allowed to grow by almost 1.4% to 10,639.43, the highest figure since October last year.

"This is a very good data. Given the strong exports, I do not think that Japan can expect a second wave of recession in the first half of 2010 "- said Kehi Morita, chief economist at Barclays Capital in Tokyo.

However, while Japanese exports grew, domestic demand was less rosy due to deflationary pressures.

In November, the total income of the Japanese wage workers fell by 2,8% compared with a year earlier, according to data of the Ministry of Public Health, Labor and Welfare. The fall, which accelerated over the revised c 1,9% fall in October, lasts for 18 months in a row.

Latest unemployment rate rose by 5.2%, while consumer prices fall ninth consecutive month.

Government has announced a record budget expenditures for next fiscal year in order to stimulate domestic demand.

Finance Minister Hirohisa Fujii was hospitalized Monday due to high pressure and exhaustion during work on the budget of the Government, told Bloomberg. Fuji, which 77 years remain in the hospital for about 10 days, the report said.

The Financial Times
December 28

Price True Movement MT4 Indicator

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PriceTrueMovement.mq4

Stop Reversal MT4 Indicator

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Stop Reversal.mq4

Heart of Forex MT4 Indicator

How to use the Heart of Forex:

The Heart of Forex can be used for any timeframes and for any of these 26 pairs:

EURUSD-GBPUSD-AUDUSD-USDJPY-USDCHF-USDCAD-EURJPY-EURGBP-EURCHF
EURAUD-GBPJPY-GBPCHF-AUDJPY-NZDUSD-NZDJPY-AUDNZD-CHFJPY-EURCAD
AUDCAD-CADJPY-EURNZD-GBPAUD-GBPCAD-AUDCHF-NZDCHF-CADCHF

I suggest to apply the Heart of Forex on a high volatility pair (i.e. GBPJPY). The Heart of Forex will refresh more frequently because of the more frequently coming ticks.
You don’t need to apply more than one Heart of Forex. It displays ALL pairs and ALL TFs on the same chart regardless which chart or TF it’s apply on.

How to decrypt the HoF colors and values:

5 different colors according to the current price move on a specific timeframe:

BLUE : strong up move for this timeframe
LIGHT BLUE : up move for this timeframe
YELLOW : move is flat for this timeframe
ORANGE : down move for this timeframe
RED : strong down move for this timeframe

The values from -100 to +100 at the top of each column are strictly an average of all displayed TFs for a given pair. You can give more importance to some TFs by setting a coefficient k in the input parameters (default is set to 1 for all, which is the same importance for all TFs).
The real utility of this board is to compare pairs on the same chart. With only one eye you can see if similar pairs move to the same direction.
A good decision tool when you have a “strong” value for the pair you want to trade and if the similar pairs have also good numbers.

Note: keep in mind that it isn't an indicator that can be backtested. It's an instant visual tool for help your manual trading.


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Heart of Forex.mq4

Citigroup does not believe in the growth of the dollar

Currency strategists Citigroup, commenting on the current euro / dollar situation, note that after the fall pair were stopped near the 200-day moving average, and daily indicators give a clear signal oversold, it is logical to expect profit-taking bears, given the rapid decline in the preceding for most of December. Single European currency, meanwhile, are continuing to try to continue the reconstruction and is currently trying to break above if Offered at around $ 1.4420, and Citigroup believe that bulls have greater chances of recovery. The Bank shall consider the recently observed decline of the euro as a correction, and believe that she has exhausted its potential and in the coming weeks and months the uptrend that has dominated earlier, probably will be further developed.

Ultra Wizard MT4 Indicator

Ultra Wizard is a multi-indicator, which has a built-in indicators and technical analysis functions, based on which gives the coefficient of force direction of the trend.

Basic conditions for display items:

Sell:

1) Multi-Info +: more than 75

2) Indice Strength: 0-1-2

3) Currency Pair Range: The difference between the coefficients of force (direction) currency 5 or more. Example 0-5, 2-8

4) Indicators 4 and 5 red down arrow.

Buy:

1) Multi-Info +: more than 75

2) Indice Strength: 7-8-9

3) Currency Pair Range: The difference between the coefficients of force (direction) currency 5 or more. Example 7-2, 9-3

4) Indicators 4 and 5 of the green up arrow.


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Ultra Wizard.mq4

Auto Pivot MT4 Indicator

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Auto Pivot.mq4

Orders for durable goods in the U.S. increased by 0,2%

A significant drop in orders for aircraft construction smoothed noticeable increase in orders for durable goods that has been seen in other sectors of U.S. industry in November.
Orders for durable goods rose during the reporting period to 0.2%. The growth rate was restrained reduction of orders in the aircraft industry by 32,6%.
Growth rate excluding orders for vehicles made in November of 2%.
Orders for capital goods increased by 2,9%.

S & P's 'weakest links' list falls sharply

List of companies most at risk because of debts, showed the greatest decline in five years, this indicates that the current cycle of bankruptcies may unfold.

Rating agency Standard & Poor's by 15 December had its list of records of 226 so-called "weak links" with $ 220.5 billion of outstanding debt.

S & P defines the weakest link, as borrowers with junk bonds, the credit rating of B-or lower, with the risk of further downward.

The number of these companies reached 300 in April to the time when credit markets have been volatile, but when the prospects for the economy and markets have improved, that number decreased.

Last month the number of "weak links" fell to 25, which was the largest decline for the month of January 2004, when the last cycle ended in distressed debt.

As expected, the number of defaults will not be significantly less in the coming months, but will drop their speed during the next year.

S & P said in December bankruptcy 260 companies per year, which was the highest result since the start keeping statistics in 1981. 12-month rate of bankruptcies continued to rise since the beginning of the crisis, reaching a rate of 9,77% by the end of November.

Diane Bass, an analyst at S & P, said: "Many companies have gone bankrupt. The positive news is that we are not adding many new companies in this list.

"For the first time we saw a key indicator, suggesting that the cycle of bankruptcies unfolds. We are at a turning point, but there are still many companies in a precarious position, so the bankruptcy will still happen, but even if the level of bankruptcies will not grow, we do not expect sharp reductions. "

S & P lowered the forecast rate of bankruptcies in 2010 due to improvements in capital markets, but more positive expectations about the rate of bankruptcies caused increased restraint of creditors "in the monetary environment, which has supported the political origins of liquidity."

S & P analysts said in a statement: "Without the revival and growth in the principal items of income, many survivors are attracted by issuers that are generated in the period between 2003-2007 may be faced with new risks bankruptcy if they did not significantly will cut its debt levels."

These weak links are very important, as companies in this group were 6 times more prone to bankruptcy this year than other borrowers negatively evaluated over the last decade.

How the media, the most vulnerable sectors are banks, building and timber production. U.S. issuers make up the largest proportion of "weak links".

The Financial Times
December 22

Eight Things for Markets to Watch Out for in 2010

No one can recall that the last two years have been mild. We are faced with the worst in recent memory the financial crisis, and some of the largest banks in the world have come under state control.

If Tiger Woods is set to 'husband of the year ", it is difficult to imagine what other surprises prepared in 2010.

There is a view that any voiced predictions about as reliable as the bonds of Dubai, then, are presented below 8 Things that can attract our attention in the next 12 months.

First: a tax cut
Any government in Europe could face a fiscal crisis. They tried to pay for his way out of crisis, and as a result of run large deficits. By mid-2010 the government will begin to understand that only a sharp economic growth to drag them out of the budget hole. To achieve this growth can only be adapted if the policy under the business and lower taxes. Germany in this matter in front of all, given tax breaks for companies at $ 12.2 billion, and individuals. During the year the rest of Europe catch up with Germany.

Second: Merging BT Group Plc and Vodafone Group Plc
In times of low growth and fierce competition the company will turn to bankers for help through the process of mergers and acquisitions, in order to stay afloat. Only great deals allow companies to reduce costs and maintain profit growth. And what about the merger between the British telecommunications company? Operator BT Group and Vodafone are faced with rapid technological changes and the subsequent impact on their profits. As two drunks in a bar, they can support each other.

Third: News Corp. sells Times
Rupert Murdoch has always been the smartest and least sentimental player in the media industry. Now he is considering to introduce a paid subscription to the electronic versions of newspapers in the UK. Somewhere in the middle, he realizes that this is madness. No one wants to pay for the online newspaper. If he wanted to go the other way - it should have been done 10 years ago. Murdoch would not have a billionaire is not feeling the moment when close to failure. The Times - is still a prestigious name, so it might be interesting for Russian oligarchs and oil sheiks from the Middle East.

Fourth: The Italian head of the ECB
The term of presidency of Jean-Claude Trichet at the ECB will expire in 2011, but by the end of 2010 will have competition for his position. They can not re-select the Frenchman, and while they can not appoint a little-known Dutchman. They have already done so. So why not appoint an Italian? In fact, this is not a country with which you can connect financial management, but Mario Draghi impressed markets as chairman of the Bank of Italy. Hey, besides, he worked at Goldman Sachs Group Inc! Alumni Goldman has managed much of the world, so why not add the ECB in its list?

Fifth: Strikes in the UK
In May, work will begin the first Conservative government since Margaret Thatcher became prime minister in 1979. Country in the economic abyss, as it was then. Tory leader David Cameron clearly wants to implement unpopular measures immediately, cut government spending and corporate taxes to rebuild businesses. Using this kind of provocation, he soon realizes that the trade unions - is still a weighty force to be reckoned with. We must prepare for a long, bitter strikes and pound until the fluctuation of market will be watching for those who win.

Sixth: Restoration of the Irish economy
Ireland is in decline. Business dried up. The budget deficit will be catastrophic mark in 11,7% of GDP this year. But remember the phrase "Irish - lucky", it mean something. Isolated among developed economies, Irladniya relentlessly struggled with the effects of bubbles. They cut state spending, allowed real estate prices to fall to a level where people can actually afford to buy it and have kept corporate taxes low. By the end of 2010, while the rest of the world will try to find out why the new debt does not allow to get out of debt crisis, the Irish economy was back on his feet.

Seventh: waves of trials
When your condition is bad, the attorneys have a job. There were many agreements reached during 2006-2007, who had a good chance to make a profit, like the one that Bernard Madoff spend Christmas with his family. Pretty funny, but no one calls the lawyer, if the deal had brought the money. When someone loses money, it turns out that it was a fraud. It is expected wave of lawsuits, as many managers to direct investments, hedge funds and bank traders decide that the big deal they signed in 2007, illegally, and they want their money.

Eighth: "long-term reinsurance" has brought us all crazy
After the debt crisis requires a lot of time to identify adverse problems. It depends on when the debts are brought before the restructuring, and how much money the company concealed. As with Dubai, the situation could spiral out of control, but it takes time. The problem is that such situations are many, and some of them should get out of control. So it is quite correct wording to the end of 2010 we have plenty behold effects of "long-term perestrahovok. We may also see many "debt explosion".

By Bloomberg columnist Matthew Lynn (Matthew Lynn)

Gilts sell-off as Britain joins Italy in debt house

The cost of borrowing for the British government has risen to the Italian level, as global markets made their punitive verdict the government's plan for spending.

Yield ten-year securities on Wednesday rose to 3.97%, up by 46 basis points, than the return of French bonds. Britain and France marched in lockstep until last month, before the issuance of a preliminary report on the budget of the Labor Party, which raised fears about the creditworthiness of England from the Chinese, Arabic and Russian investors.

But what really attracted interest from the markets, it is narrowing the gap with Italian bonds, which were previously perceived as a symbol of the state with poor governance, in captivity Docle Vita.

Yields on ten-year Italian securities rose slightly above 4% despite the crisis in the eurozone because of Greece, and fell below 3.98% earlier in the week.

Julian Callow, European economist at Barclays Capital said that Britain is in the center of the storm, as the Bank of England starts to cut the rate quantitative easing.

Bank bought more securities for the past 9 months than the government issued. These measures have magically reduced the cost of financing the deficits, but can lead to dramatic consequences in 2010. Markets know it. They provide a risk premium on sterling ".

"In addition we have a whole Spector uncertainty associated with elections. We have the highest deficit relative to GDP in the EU after Latvia and Ireland. There is no assurance that the next government will be enough to introduce the necessary tightening of fiscal policy ", - he said.

UK dependent on the fluctuations of securities, as foreign investors own £ 217 billion of its debt, or total 28%. This independent funds and will sell assets, if Britain would lose its AAA credit rating.

They have other attractive places to invest money, such as Turkey, Brazil or India, where the demographic situation is better, but perspetivy growth above. Chile has already cut the profitability of the British debt on some maturities.

Simon Darrek, manager of foreign exchange transactions in the Bank of New York Mellon said that world markets are not impressed by the pre-budget report in Britain and do not believe Treasury forecast growth of 3,5% in 2011.

"The government will take an extra £ 700 billion in 2014. The national debt will rise to £ 1.5 trillion. That is equal to £ 48,000 per worker, an Englishman. The market's reaction is justified, "- he said.

Of course, in Italy their problems. Government debt was much smaller than before the crisis. IMF suggests that the debt will rise to 120% of GDP next year. But this debt, mainly distributed in the thrifty Italians, who are less fickle than the foreign funds.

Debt Italian households amounted to 34% of GDP in 2007, compared to 100% in Britain. "If you look at the private and public debt, together, they will look better" - said Marc Ostwald of Monument Securities.

"While the government is going to my thoughts, perhaps we will see that spreads to the German treasury bonds widened to 120 basis points, with the risk of reaching 150, if there is no clear winner in the elections," - he said.

For Italy, this situation could be just the lull before the storm. Markets suggests that Germany, ultimately, save Greece, if necessary, preventing the impact on other countries of Central Europe.

This is a controversial proposition. Vissing Volcker, head of the finance committee of the German Bundestag, said that there should be a clear understanding that "Germany is not liable for the debts of Greece.

Vissing said that the ex-Finance Minister Pierre Steynbruk spoke only for himself, and not on behalf of the whole of Germany, when he talked about saving the laggards in the eurozone. His comments should be refuted.

The Telegraph
December 24

New company in the Group InstaForex

Insta Forex Company officially announces the beginning of a new company Insta MediaGroup, a member of the group of companies Insta Forex.

Insta MediaGroup - a modern media agency of the full cycle, offering a full range of Internet marketing: design, implementation, promotion and operations support; creation of press-books, and any promotional products, SEO-optimized; flash and 3D-design, as well as other quality and timely services.

Thus, after the establishment of the company Insta MediaGroup today a group of companies Insta Forex includes: Media Agency -- Insta MediaGroup and the company "Western Garant, which provides a wide range of information and consulting services in the financial sector.

The index of activity in the service of Britain slightly exceeded the forecast for October

The index of activity in the service of Great Britain fell by 0.2% in October in monthly terms, said National Statistical Office. Recall that in the previous month index also fell by 0,2%, and in the reporting period is expected to decrease by 0,3%.
In annual terms, the index of activity in the UK services sector dropped by 3.7%, reflecting deterioration in four of the five components of activity in the services sector. Hardest to the value of the total affected the scope of business services and finance, where the activity has deteriorated to 6.0%.

Personal incomes in the U.S. increased by 0,4% in November

Wages received by American workers rose in November at 0.3%, which is another evidence of improvement in the labor market in the United States. Increased wages and salaries resulted in increased personal income by 0,4% in the reporting period. Growth of personal income in November was a record high in May of this year.
Real disposable income adjusted for inflation and taxes rose in November at 0.2% for the third consecutive month.
Consumer spending increased in the reporting period to 0.5% after increasing by 0,6% in October.

Canadian GDP growth in October amounted to 0,2%

Canadian GDP rose in October at 0.2% the second month in a row.
As in September, the rate of production increased in most major sectors of the economy. Significantly increased the activity of Realtors and brokers led to record growth of services by 0,2%.
In addition, significant increases were observed in the retail and wholesale trade, as well as in some branches of tourism. At the same time, there was a decline in business activity in the financial and insurance sectors.

Number of applications for unemployment benefits in the United States fell to 452 thousand

Number of primary applications for unemployment insurance in the United States has declined over the week to December 19 to 28 thousand to 452 thousand, being at its lowest level since September 2008.
Experts expect that figure will be at the level of 470 thousand
number of Americans continuing to receive unemployment benefits decreased by one week to December 12 at 127 thousand to 5.08 million. This indicator is at a record low since February this year.

Euro / yen is trying to continue the growth

Euro / yen in the Asian session was unable to overcome Offer in Y131.40/50, which provoked a reduction in short-term long positions, providing a pair of correction to levels near Y130.90/80. Here, however, the decline was halted and Jerk against the single European currency in the pair with the dollar, euro / yen resumed its upward movement, in which the bulls so far managed to update the session highs and check the strength of Offer near Y131.60/70 . Couple now holds about Y131.66, continuing to be in demand, and dealers noted that a break above Y131.80 would be a positive signal for the single currency, suggesting the possibility of continuing growth initially to Y132.00/05, and then to Y132.35/40 and Y132.80/85. Bids are now visible in the area Y131.35/30 and Y131.10/05.

"CNBC Magazine" noted the company InstaForex

In the December issue of the authoritative British monthly CNBC Magazine published a long article devoted to the company Insta Forex. In the article "European contender - Asian champion" describes the current situation on the international Forex market and place the company Insta Forex in it. For example, the company, according to the magazine, is the leading broker in the Asian region and ranks among the leading brokers in Europe, which proves not only the facts, expressed in quantitative terms, but also a variety of awards that the company received in 2009.

Thus, the publication of CNBC Magazine has praised the company Insta Forex for the period of 2009.

It should be noted that this publication CNBC Magazine, dedicated to international online Forex-broker Insta Forex, is not the first in 2009. A number of both European and Asian editions of already published those or other materials on the company in the pages of their journals, newspapers and online portals available that you can see "Press Coverage" at the company's website instaforex.com.

Bears continue to monitor the situation in the pound / dollar

In anticipation of the publication of data from the British pound felt the increased pressure and sank to fresh session lows near $ 1.5925, but given the nature of the relatively good news from Albion, the pair then managed to jump higher. However, attempts to seize the initiative until the bulls still looks viable, the mood in the pound / dollar remains negative, and, meeting resistance from the Ofer, remaining in the region $ 1.5960/65, the pair again turned lower. Bids remain in the area of $ 1.5925/20, but below you can see a small foot, while a stop order, by hearsay, and are placed below the figure. Offer, meanwhile, in addition to $ 1.5960/65 also visible around $ 1.5980/85 and $ 1.5995/00, but dealers say that for some weakening of the negative attitude of the British currency, must return above $ 1.6030/50.

Nomura expects the growth of the Japanese yen

As the currency analysts Nomura, despite the recent strengthening of the American currency pair dollar / yen could still fall to the recent lows and even lower towards the end of the Japanese fiscal year, which ends March 31. The bank believes that the market has over-enthusiastically looks forward to raising interest rates in the U.S., so the disappointment can be very rapid. Bank analysts also note that the sale of yen by the retail investors are unlikely to offset the inflow of currency from the constant current account surpluses in Japan, given the fact that next month trend away from risk will likely remain a key factor of influence in Japan. In addition, the Bank believes that in anticipation of the completion of the Japanese fiscal year, the corporation will repatriate yen. For all of these factors, the bank's strategy expected growth of the Japanese currency against the dollar to a level of 83.00 at the end of the first quarter of next year. At the moment pair dollar / yen is at around 91.82.

The deficit of current account balance of payments of the UK has risen slightly for the third quarter

Deficit of current account balance of payments amounted to 4.7 billion British pounds for the III quarter of this year compared with 4.4 billion pounds in the previous quarter, reports the National Statistics Office. Thus analysts predicted an increase in the deficit to 8.1 billion pounds. The deficit of current account balance of payments has increased over the reporting period due to the reduction of the surplus income of 1.5 billion pounds to 6.7 billion pounds. The deficit on current transfers fell by 0.6 billion pounds to 3.6 billion pounds. surplus on trade in services rose during the reporting quarter to 0.4 billion pounds to 11.8 billion pounds.

The 'Global Imbalances' Myth

Different countries have always played different roles in the global economy

The economic crisis has weakened in recent months, which resulted in the appearance of questionable international agreement that the global economy should be re-perebalansirovanna. "We can not follow the same policies that led to this unbalanced growth," - President Obama said during a tour of Asia last month. ECB President Jean-Claude Trichet said in September that "imbalances were at the origins of the current difficulties. If we do not fix them, we will prepare the foundation for the next major crisis. "

These global imbalances are expected to include excessive American consumption, excessive flow of trade from Asia to the West, and the lack of U.S. in Asia, as well as too much stock in conjunction with insufficient expenditure of Chinese consumers. However, what if their own global imbalances - is a myth, a policy aimed at their reduction, will only make things worse?

Unchanged, the fact remains that in any moment of the last century did not have anything like the global economic balance.

Consider the flowering of "American Century" after the Second World War, when Western European countries have been devastated by war, and the Soviet Union and its new satellites slowly recovering. In 1945, the U.S. accounted for more than 40% of world GDP and dominance in world production. The country was in such a dominant position, which was able to spend the equivalent of hundreds of billions of dollars in economic recovery in Western Europe under the Marshall Plan, as well as to Japan during the seven-year military occupation. In the late 1950's, 43 of the 50 largest global companies were American.

1970's also hardly be called balanced, not least because of the gold standard era, when we started the oil shocks, the Arab oil embargo of 1973, inflation and stagflation, which spread to Latin America and Europe.

1990-e were similarly unbalanced. U.S. consumed and absorbed most of the available global capital at its scorching stock market. With the collapse of the USSR and sluggish economies of Germany and Japan, American consumers finally occupied a central position in the world. Innovations in the new economy has caused renewed interest in stock markets overshadowed the debt crisis in South America and the implosion of the currency in South Asia, all of this was due to aggravation of the concentration of capital in the United States and its deficiency in the developing world. When in 2000 the tech bubble burst, there are few that could be done with those global driving forces glut of telecommunication products in the United States and furious abundance on the stock market.

Now, when officials and economists say the adjustment of global imbalances, it is unclear what the reference point they have in mind.

The so-called excessive American consumption, the East-West trade flows, China's savings, it seems, were not responsible for the recent crisis. All this is mentioned instead of the mass of inappropriate rates on the housing market and the U.S. trillion derivatives, came to these baseless funds.

Yes, many woven for himself an irresistible story that relations between China and the U.S. have been distorted because of the fixed and non-convertible currencies in China on the one hand and the American bond on the other, which led to a massive outflow of capital from the United States. However, this money is returned to the United States as China's purchases of Treasury bonds, securities backed by mortgages and other assets denominated in dollars, which then spilled over into our banking system, which returned to the business and the U.S. Treasury, some of whom then went back China.

What some see as an imbalance can be described as a system of constant movement of capital and goods. China's reserves and debts of the U.S. does not lead to the collapse of the reasons it is not in the American consumer. This resulted in even consumer debt, after all, more than 90% of Americans still own takuschimi credit cards and pay the mortgage. These (and much more dirty) the reasons for the collapse were in a powerful combination of financial innovation, electronic instantaneous movement of capital, greed on the part of banks and investors around the world in the midst of an economic merger between China and the United States, which keeps interest rates and inflation lower.

Today's agreement sounds very similar to the orthodoxy of the past year: allow each country to maintain the balance of his system, interacting with other systems to create one mega-balanced system. However, such a balance exists only in theory, and is only possible in the future.

Indeed, if last year's crisis has taught us anything, so what podstraivanie reality under the abstract theory - it is a recipe for disaster. The need for appropriate action at that time forced the central banks and governments of the world by the order to do a really good job during the economic emergency that has engulfed the world. Eclectic requirements of the crisis took precedence over models and theories that it was indeed correct.

And now, when the crisis subsided, the greatest danger of all is our collective faith in something, how the world should work, which stifles creative dexterity policy that adapts to the world depending on what is actually going on there. A policy agreement with the global imbalances can be understood and initiatives of the American government incentives aimed at increasing domestic savings. Sounds good, but if it does not mean reduction in investment in innovation, education and infrastructure.

It can also lead Chinese officials to try to move away from exports and government spending. In the long run it may be useful, but can cause serious damage to internal Chinese growth and global supply chain, if such measures are taken for reasons of urgency. For its part, the EU argues, correctly, that he was not the main cause of the obvious imbalances. But European leaders have been pushing in front of all of this thesis and the belief that China and the United States should correct it.

Fortunately, there is much less risk that the Chinese Government to overturn its basket of apples, at the time, as the American government is acting much more rapidly.

By Mr. Karabell is president of River Twice Research and author of a recent article "Supersliyanie: How China and the U.S. economies have become one" (Simon & Schuster, 2009).

The Wall Street Journal
December 21

Retail sales in Canada rose by 0.8% in October

Retail sales in Canada rose in October with an inflation rate of 0.8% to $ 35.3 billion increase in sales was recorded for the eighth time in the last ten months.
Sales in the automotive sector grew in October at 3.0%. At the same time, retail sales excluding auto sales fell in the reporting period to 0.2%.
The highest growth followed by the automotive sector was observed in the shops of clothes and accessories, where sales increased by 1,9%

Morgan Stanley: Outlook 2010. From the exit to the exit

Update global forecast: Prospects for 2010: From the exit to the exit

This year, spoke only on emerging from the great recession, and, as we expected earlier this year, it all became possible because of the massive global government incentives. The next year will only talk about withdrawal from the extra-expansionary monetary policy, and we expect this process will begin around mid-2010. Yes, probably, these actions will be cautious, gradual and transparent. Nevertheless, the prospects and process outputs can have unintended consequences: we think that the government bond market will be the first victim. Although we believe that the withdrawal will be the dominant theme in macroeconomics in the next year, we allocate 5 important economic themes in the context of global perspectives, which we believe will be very important for investors in 2010.

A tale of two worlds: We predict 4% of global GDP growth in 2010, which was only slightly expressed only about three months ago (see the previous global forecast: "Up without hesitation, 10 September 2009). Indeed, if these data are confirmed, it will be a worthy outcome, especially in comparison with the extensive pessimism during the year. However, this growth rate falls short of the 5% that was observed during the 5 years before the great recession that is the result of an unprecedented monetary and fiscal incentives that create significant long-term risks in different directions. In addition, our 4% of global GDP growth mask two very dissimilar stories. One of them - this is very cool recovery in developed economies - "BBB" restoration, which we discuss below. Another - this is a much more positive outlook for emerging markets, which we predict the growth of output by 6,5% in 2010 (China - 10%, India - 8%, Russia - 5.3% Brazil - 4.8%) with 1,6% this year. Restoring the balance in favor of domestic demand leads to growth in developing markets in the process of change. In addition, as noted by our Chinese economist, the official statistics are likely to greatly underestimate the level and rate of growth of consumer spending in China. In short, we believe that growth in emerging markets is clearly in advance of the dynamics of this situation and even strengthened during the crisis.

BBB-Rebuilding G10: in contrast to our optimistic stories about the emerging markets of the developed economies of the G10, we forecast GDP growth, which barely reaches 2%, and the restoration of BBB is nothing more than in - bumpy - bumpy, IN - below - par - below normal, and B - boring - boring. According to our estimates, GDP growth in more than a dozen countries on average 2% in the second half of this year and next year the rate is not greatly accelerated, and hence the conclusions in our article "up" without "hesitation", published three months ago, which remain relevant . There are two probable reasons, because we believe that the recovery in developed economies will be held on the principle of 'BBB': lack of credit and unemployment. Recovering in a lack of credit means a situation where banks are reluctant to lend, and non-bank private sector does not want to take, which is a standard situation after the credit boom in the last cycle, and the banking crisis, restoration of the shortage of credit reflects the economic growth below potential, as mobilization of capital through credit and financial system is difficult. In addition, we expect the resumption of growth of unemployment in the G10, with only slight reduction in the level of the U.S. next year, and continued growth in Japan and Europe. Unemployment in developed countries may be structurally higher in the next few years, as many unemployed people have the wrong skills or they are in the wrong environment, where there is a change of sectoral or regional growth.

More differences in growth in the countries of the Big Three: Beneath the surface of what we call a dull BDB recovery in developed economies is differentiated history for the three largest economies in the bloc: the U.S., Eurozone and Japan. We expect significant growth differences between them in 2010, which again may affect the currency, interest rates and stock markets. We see the U.S. as a leader among this group in the next year, with an average annual GDP growth of 2,8%. Euro area economy seems to show twice the smaller growth than the United States (1.2%), while Japan should grow by only 0.4% next year, and, thus, effectively re-enters the stage of technical recession in the first half of next year. One of the main reasons advanced dynamics of the U.S. lies in the fact that lack of credit affects less than the private sector, as banks (as opposed to capital markets) play a smaller role in financing the economy than in Europe or Japan. Another reason is that American companies were much more aggressive in the dismissal of workers this year than their European or Japanese counterparts, so the labor market in the United States will demonstrate the recovery (albeit slow) in the next year, while unemployment is expected to grow both in Europe and in Japan. In addition, European and Japanese exporters have to face difficulties because of currency effects, at the time, as U.S. exporters should benefit from the weakness of the dollar this year.

Moving toward the exit, the cycle of liquidity with the country rated AAA, remains unchanged: As mentioned above, we expect to start out of the super-expansionary monetary policy implications of the same will be the main theme of the macro economy in 2010. Next week we will discuss the details of the likely monetary exit strategy in different countries at the final annual meeting on global monetary policy. Suffice it to say that we expect from the Fed, the ECB, the People's Bank of China joint motion in the direction of higher interest rates in 3Q10, with the Bank of England, close to the 4Q. The central banks of countries such as India, Korea and Canada are likely to begin earlier, and such as Japan - will lag behind. Given the vulnerability of the financial sector, central banks would try to go gently, gradually and in a transparent manner, so that any body movements will be known in advance, partly developed by the relevant signals, and partly due to the partial use of bank reserves. It is important to note that, while weakening the end and beginning of release, will cause fluctuations in financial markets, and this is one reason why we see a sharp drop in bonds next year, it should be noted that official rates will probably stay below its neutral level (even domestic factoring, is likely to be lower than it was in the past) during 2010, and even in 2011. Thus, monetary policy will only go from "super-expansionary" to "remain quite expansionary." This can lead to what we call a cycle of liquidity AAA (ample - sufficient, abundant - plentiful, augmenting - multiplier), which we identified as the main driving forces in asset prices, economic recovery and good luck this year, ending in the next. Indicators, which we follow to confirm or refute this idea are our global measure for the measurement of excess liquidity, which is defined as operating money (cash and overnight deposits), held not by banks in calculating the nominal GDP. This figure exploded this year, and we expect further growth, albeit at a much lower rate during 2010.

Sovereign and inflation risks on the rise. The fifth and last main topic for discussion at the market in 2010 will be "sovereign risk and inflation risk." In our view, current issues related to the financial problems of Greece, still affect many developed (not developing) economies. We note that fiscal policy will remain expansionary in nature in all the major economies next year, and, as it should be, BBB-recovery will still need support. Nevertheless, markets are likely to worry about long-term financial sustainability, and rightly so. It is important to note that this is not about potential defaults of developed economies. It is extremely unlikely for one simple reason: most of the outstanding debts of governments with developed economies are in domestic currency. If (although unlikely), the Government will not be able to finance payments to repay the debt by issuing new debt through higher taxes or sales of assets, will be able to direct their Central Bank to print as much money as needed (you can call it quantitative easing). Thus, ultimately, the sovereign risk means the risk of inflation, rather than a direct risk of default. We expect that markets will increasingly pay attention to this next year, pushing inflation premiums and, consequently, bond yields are much higher. In other words, the next crisis is likely to be a crisis of confidence the government and the central bank's ability to take on increasing debt burden of the public sector, without creating inflation.

Morgan Stanley
December 18

Morgan Stanley predicts growth of dollar in 2010

The U.S. currency on Monday continued to use the location of the bulls, and while in the short term to exclude some profit-taking on fresh long positions, open it, it is not necessary, currency strategist at Morgan Stanley advised to use a for renewed attempts to reduce purchases. The bank is very optimistic about the prospects say the dollar in the coming year, noting the positive signals of economic data that give reason to expect a collapse of incentives in the United States. Statistics, according to Morgan Stanley strategists, argues in favor of the fact that the U.S. economy will recover faster than many other developed countries and they expect to reduce the euro / dollar to $ 1.41 by the end of March 2010, whereas by the end of the second quarter in the bank waiting for the fall pairs to $ 1.37, and by the end of the year - to $ 1.32.

Eurozone trade surplus amounted to 8.8 billion euros in October

Eurozone trade surplus amounted to 8.8 billion euros in October this year compared with a surplus of 0.9 billion euros in the previous month, the EU statistical agency Eurostat. Note that in October last year was recorded trade deficits in the euro area is 1,2 billion euros.
Taking into account seasonal factors, exports of the euro zone fell in October to 0.2%, while import volumes fell by 2,2%. On an annual basis without taking into account seasonal fluctuations, export volumes decreased by 17%, while import volumes fell by 24%.

The Great Stabilization

Recession was less damaging than expected. The consequences will be more dangerous than many assumed

In a year when the world economy experienced the deepest recession since the Second World War, these events were called "The Great Recession." The opposite also can be called "The Great Stabilization. 2009 is unique not only because of the extraordinary fall of production, but also those that managed to avoid catastrophe.

Twelve months ago, a panic due to bankruptcy of Lehman Brothers pushed the markets to collapse. Global economic activity, from industrial manufacturing to foreign trade, fell even faster than in the early 1930's. Nevertheless, at this time, the decline was halted for several months, and the emerging economies have gone through this process faster. The output in China, which stopped growth, but never fell, showed an annualized growth of almost 17% in the second quarter. By mid-year in the major economies (except the UK and Spain) began to grow again. Only a few backward countries such as Latvia and Ireland, are still in a recession.

It suffered significant collateral damage. The average unemployment rate according to the OECD amounted to 9%. In the U.S., where recession has started much earlier, the unemployment rate doubled to 10%. In some countries, years of progressive work on poverty reduction have been spent in vain, as the weak economy and high food prices are doubly hit the poorest. However, due to resistance of large and populous countries like China, India and Indonesia, the developing world has experienced is not much more serious recession than in 1991. For many people in the world, this recession was not so much, and "Great".

This outcome was not inevitable, it was the result of a large, rapid and volumetric response of the problem. Unstable banks was provided by multi-trillion-dollar support in the form of taxpayers' money and other guarantees. The central banks lowered interest rates, big banks sharply increased their balance sheets. Governments around the world have developed and introduced financial incentives. This extraordinary activity helped to stop the panic, to support the financial system and deal with falling demand in the private sector. Despite claims to the contrary, the Great Recession would be a Depression without these measures.

Stable, but fragile
This is the case with the good news. The bad news is that stability today, albeit a very acclaimed - alarmingly fragile, both because of the fact that global demand is still dependent on government support and because the public is silent about solutions to old problems while creating new sources of instability. Real estate prices in most countries are falling rather than rising, and the nationalization of Astraliyskoy Hypo Group argues that bank pressure is still ongoing. Visible signs of success, for example, the early return of U.S. banks, the state capital, makes easy to forget about the fact that recovery is still dependent on government support. Remove the temporary effects of restocking, and it turns out that most of the global vspleksa demand depends on the state treasury: from the official vspleksov induced investment in China, to provide an incentive costs in the United States. That is, it is in large developing countries, recovery is gaining momentum, while in developed countries, governments are trying to prevent retsedivov.

This discrepancy will continue. Demand in developed countries will remain low, especially where there is a higher household debt and severely damaged the banking system. Despite all the talk about reducing the leverage, the debt of American households, compared to their income only slightly below its peak, and about 30% higher than the level a decade ago. British and Spanish households have adjusted even less, so the probability of prolonged weakness in private spending is much higher. Given that the state contract includes the burden increases, governments of developed countries will be increasingly difficult to borrow even more to compensate. The contrast with the better management in developing countries will grow. Investors are already concerned about the Greek's default, but the rest of the euro area is also at risk. Even the United Kingdom and the United States may face higher cost of borrowing.

Large developing economies face the opposite problem: the specter of asset bubbles and other distortions produced by the government, forcing them to keep the financial terms are too free and too long. China is concerned about the scale and composition of their incentives. There is disturbingly excess liquidity and therefore the government does not allow the yuan to be valued to the extent to expand the economy towards consumption. Free monetary policy in developed countries makes it difficult to compress the economies of developing countries, even if they need it, as because of this they will absorb even more speculative foreign capital.

Fine Line
Move smoothly if the world economy from the Great Stabilization to sustained recovery depends on how to cope with such problems. Some tools are obvious. A stronger yuan would cause rebalancing China's economy, reducing pressure on other emerging markets. Possible plans for the medium-term budget cuts could cause a risk of growth of long-term interest rates in affluent countries. But there are real trade-offs. Tightening monetary policy can kill a recovery in the rich countries, and monetary stance, which plays a role in the domestic U.S. economy, added to the problems facing the developing world.

That's why politicians faced with technical difficulties to develop an exit strategy right. Worse, they must do so against a background of clouds gathering over them. As the tax on bank bonuses in the UK, fiscal policy in developed countries, risk facing public anger at the bankers and the failure of their salvation. The independence of the Fed in the U.S. is under pressure Konrgessa. Politics, leading to high unemployment, means trade shocks, which lead to greater risks, particularly to China.

Put all together and what happens? Pessimists expect vsemozmozhnyh shocks in 2010, from the sovereign debt crises (Greek default?) To the rash of protectionism (U.S. tariffs against "unfair" cost of the Chinese currency, for example). More likely abundance of smaller problems on a sudden sharp increase in interest income on bonds (Great Britain before the election), to short-sighted decisions of tax (tax on financial transactions) and to strike because of wage cuts (British Airways - is a sign). All these trifles, compared with cataclysm year ago, but enough to keep a joyful holiday.

Economist
December 17

BNP Paribas expects growth in the dollar / yen

As the currency analysts BNP Paribas, with today's increasing pair dollar / yen market got rid of the weak long positions in U.S. currency, clearing the way for strong players who can ensure the growth of dollar / yen to a maximum of 4 December at Y90.80. According to the Bank's strategy in the next couple to rise above this level, and then continue upward movement is the key to maximum 27 October Y92.35 - a breakthrough at this level will confirm the reversal of the downtrend. At the moment pair dollar / yen is trading at around Y90.44.

Ben Bernanke, the man of the year 2009

"Too big companies to allow them to go bankrupt - it is one of the biggest challenges faced by our country."

Fed Chairman spoke on 8 December, the chief editor of TIME Richard Stengel, managing editor, John Hugh, an assistant editor in chief Michael Duffy and chief correspondent Michael Grunwald, talking about everything from the economy and ending with the contents of his wallet. Below are some excerpts of that conversation:

TIME: Explain in general terms for our readers, what has been done over the past year and how it affected their lives, for better or for worse.

Ben Bernarke: Almost all major financial institutions in the world is also facing bankruptcy. And we knew, and I knew, based on their political experience, that if the financial system will collapse, in the sense that many large companies go bankrupt, the financial sector will cease to function, and implications for the global economy would be catastrophic. We would have probably had to deal with depression, comparable to effects of the depression in 1930. Such events would not hypothetical.

Agree, there is a certain irony in the fact that a man who has spent a lifetime studying the economic history of one day wakes up and realizes that now he is in the center of the story during a very unusual title.

Well, of course I did not expect such an event, when he came to Washington in 2002. Undoubtedly. When I became chairman of the Fed in 2006, I hoped that my main goals would be improving the management, coordination and monitoring of policies. We were certainly aware of the risks of financial crisis, however, of such size and danger, we did not expect. I would like, but it was not the case.

This year you could move a little farther than the previous chairman of the Fed. Are you still confident that the awareness of people about what is happening at the Federal Reserve brings a positive result?

Yes. In the past, the Fed chairman did not apply to people directly. I felt that the problem was not only a misunderstanding of what makes the Fed, but I also knew that fear and uncertainty that now and then appeared in various surveys related to the fact that people do not understand what is happening with the economy and financial system . And I thought it would be very useful, as chairman of the Fed, go out and talk directly with people who try to explain what we are doing and why, that is likely to happen in the future. I think it helped some. It is true that the Fed is faced with strong political pressure and it is unpopular in many circles. Work Fed is to make the right decisions, to seek long-term interests for the essence of the economic system, often, such measures are unpopular. But they are necessary for a favorable outcome.

The money that the Fed releases and what we spend on subsidies - are one and the same. The rest we have to borrow. There are lots of people who would say that this system can not be sustained, and the only solution may be some kind of tax, for example, the sales tax and VAT. Do you favor one of these alternatives?

The way I presented it to Congress said that, I strictly uphold the law of arithmetic. This law means that if you're a person with a low-tax, you are responsible for finding ways in which you save your expenses so that there was an imbalance between revenues and expenditures. In the same laws of arithmetic, if you or anyone else believes that government spending is important and believe that the cost of major programs are to grow - that you should figure out how to reach revenues to offset expenses. So, once again, I think that is the main task of the Congress. I talked about the deficit, because I think that the budget deficit strongly influences the economic and financial stability. We should talk about it. However, given the specifics of achieving financial balance, it is still the responsibility of elected officials.

You said that banks are still in the process of recovery. Tell us more about what this means.

The situation in the banks stabilized. They have built up capital and therefore are in better shape than we were. They are engaged in lending, but at insufficient levels to maintain a healthy recovery. One important reason is the loss incurred by them, and what they went through, so now they are very conservative in the conditions are still very weak economy. As the organ of banking supervision, we are in a difficult situation. We limit it clear to banks that want them to make loans to credit-worthy borrowers. It is in the interests of the bank, is in the interests of the economy, and, of course, is in the interests of borrowers. The problem is that banks have already given enough credit, which can not be repaid, so we do not want the new "bad" loans. Thus, we try to work with the banks, so that we can be confident that they will be given as much credit for viable as possible, we want to be sure that they have sufficient capital, short-term financing, and experts and regulators do not unreasonably denied loans. We want to work with banks to make sure that they comply with the balance between prudence and caution, giving good loans for the benefit of the economy and their own profit.

Do not slikshom much money the bankers?

I think that the bankers should recognize that the government and taxpayers have saved the financial system from collapse last year. Recognizing this, I think that the bankers have to look in the mirror and decide what might need to exercise more restraint in how much they currently pay, given that taxpayers have the power to save the entire system.

Goldman Sachs and Morgan Stanley returned the money back, but they have become bank holding companies, and is now governed by certain articles of the Federal Reserve, right?

Yes, in the long term, I think we need tools to get rid of companies that are too big to fail. This is a big problem. I want to be very clear: "too big to go bust" - a huge problem facing the country, and we must take steps to eliminate this problem.

There were times you have days when waking up, you do not know what to do next?

I want to remember the lessons of the Depression and that showed Franklin Roosevelt: when all the traditional methods have failed, the need to try new ideas. And he really wanted to try unconventional methods when traditional proved useless.

Time
December 16

UK retail sales unexpectedly declined in November

The volume of retail sales in Britain fell by 0.3% for November, reported the National Statistics Office. Thus analysts predicted an increase in rate of 0,5%. Note that in October the index of retail sales increased by 0,6%.
In annual terms, the index of retail sales amounted to 3.1% for November compared with 3.7% a month earlier. Analysts predicted that the annual rate will not change.

Japan needs a clear plan to reduce debt

Japan needs to "clear" order to reduce the world's largest government debt, said Moody's Investors Service, after conflicting statements by the Prime Minister Yuko Hatoyama (Yukio Hatoyama) and head of financial management as to the intention to sell bonds next year.

"Reducing the deficit and debt targeting should help support the rating," - said yesterday the senior vice president of Moody's Investors Service, Thomas Bern (Thomas J. Byrne) in a telephone interview from Singapore. "Most of all we are concerned about the lack of clearly defined long-term fiscal consolidation and debt reduction plan."

Hatoyama hinted that may allow the sale of debt over 44 trillion. yen to support economic growth, while Finance Minister Hirohisa Fujii (Hirohisa Fujii) stated that the restrictions must be strictly observed. Faced with a reduction in tax revenues and inflate public debt, the new government, which the three-month-old trying to support the spending cap without stifling the recovery processes in the country after the worst postwar recession.

"At the moment, the strategy is not formulated," - said Bern. "That's why we are so closely observed."

Yesterday, Japan's Cabinet approved the budget targets for the year beginning April 1, and said he would keep the issue of bonds at around 44 trillion. yen ($ 495 billion). Deputy Prime Minister Naoto Kan, said yesterday that the continued restrictions on the issuance of bonds plays an important role in preventing the growth of profitability of long-term debt. However, the scheme does not mention specific guidelines for containment of the debt.

"The method of trial and error"
"In the past, the system was stable," - says Seyzhi Shiraishi (Seiji Shiraishi), chief economist at HSBC Securities Japan Ltd. Tokyo. "But now the government destroys the previous system and works by trial and error.

The yield on the benchmark 10-year-old bond fell to 1.260% at 12:42 on Tokyo time of the day. The yen, which reached 14-year high against the dollar last month, is trading at around 89.59.

To restore the financial situation in the country, the government will make a medium-term budgetary framework in the first half of next year, according to established budgetary principles. The Government will also seek to reduce the deficit and a stable basis of the ratio of debt to GDP ratio in the long term, "he said.

Standard & Poor's also focuses on medium-term budgetary trajectories and feasibility of government policy on fiscal consolidation, "said Takahiro Ogawa (Takahira Ogawa), director of sovereign ratings at S & P in Singapore.

"We believe that the credit rating of Japan is inclined to the tendency to deterioration, but not in the least, to change our views or to lower it," - said yesterday Ogawa. S & P evaluates Japan's sovereign credit rating in the AA with a stable outlook for the future.

Failure to maintain the ceiling
Even if the Japanese government is unable to keep the ceiling the sale of bonds, it would not necessarily influence the opinions of Moody's credit rating on Japan, "said Bern. Rating Moody for Japan - ??2, which is the third of the maximum investment level with a stable outlook for the future.

"One year of exceptionally large budget deficit will not automatically have a negative impact on the rating," - said Bern. "The government in any year may issue a set of bond, it may be done specifically for this year, and this is a normal practice, if there is a medium-term plan, which reliably confirms the future deficit reduction."

Former Prime Minister Junichiro Kozumi (Junichiro Koizumi), who was a deputy in the Liberal Democratic Party, meant the goal of balancing the budget by the end of March 2012. Administration Taro Aso (Taro Aso), which was dissolved Hotoyamoy elections in August, refused from that goal and set it for 10 years. Aso also set new targets for reducing the budget deficit to GDP by early 2020-ies.

"We believe very likely that the funding next year or two will be no upward pressure on interest rates", - said Bern. "We fear that the funding and the availability of public debt will be at risk only if they are not articulated long-term goal of fiscal consolidation.

Bloomberg
December 16

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Consumer prices in the U.S. increased by 0,4% in November

Consumer prices in the U.S. increased by 0,4% in November due to rising energy prices. The price index excluding volatile food prices and fuel prices remained unchanged compared with the previous month.
Compared with the same period last year, consumer prices in the U.S. rose by 1.8%, while the support price index - by 1,7%.

The number of unemployed in Britain unexpectedly fell for November

According to the National Statistical Office, the number of applications for unemployment benefits (Claimant count) in the UK decreased by 6 000 for November, after increasing by 12 900 in the previous month. However analysts have predicted an increase in the number of new applications by 13 800.
Unemployment Rate (Claimant count rate) decreased during the period from 5,1% to 5,0%. Annual average earnings index excluding bonuses for the three months, including October, amounted to 1 , 7%. Previous value of the index revised from 1,8% to 1,7%.
The unemployment rate, calculated by the methodology of the International Labor Organization (ILO unemployment rate) amounted to 7,9% for the three months, including October, while the forecast was 8.0% and the previous value of 7.8%.

Inflation in Britain rose to 1.9% in November

Annual consumer price index in the UK for November rose to 1,9%, reports the National Statistics Office. Note that in October the annual inflation index up 1.5% in November projected growth rate to 1,8%.
In monthly terms, consumer prices increased by 0,3% in November after rising 0.2% the previous month. Analysts speculated that the index increased by 0,2% during the reporting period.
At the same time, the annual consumer price index, not taking into account the price of food, energy, alcohol and tobacco products (main index) for November rose to 1.9% at the previous value of 1.8% and 1.8% forecast.

ZEW index of economic sentiment in Germany decreasing for the third consecutive month

ZEW index of economic sentiment in Germany for December was 50.4 points compared with 51.1 points a month earlier. At the same analysts predicted decline to 50.3 index points. Note that the index drops third consecutive month, but its current level is much higher than the historical average 27.0 points.
The index of current conditions in Germany rose in December from minus 65.6 points to minus 60.6 points.
Index Eurozone ZEW economic sentiment fell for the reporting period by 3,8 points to 48,0 points. The index of current conditions in the euro area has improved in December to 2.5 points and was minus 67.8 points.

Producer prices in the U.S. increased by 1,8%

Wholesale prices of producers in the U.S. rose in November at 1.8%. Note that the energy had ¾ of growth rate.
Producer price index has risen over the same period last year to 2,4%.
The index excluding prices for food and energy prices rose in November at 0.5%, surpassing expectations. In annual terms, this index increased by 1,2%.
Experts expect increasing the producer price index in November at 1.0%, and the auxiliary index - by 0,3%.

Long-term capital inflows to the U.S. amounted to 20.7 billion dollars

U.S. Treasury on Tuesday published a report on international capital flows for October this year. During the period, foreign investors purchased the long-term U.S. securities totaling $ 43.4 billion to $ 28.8 billion when it accounted for foreign private investors, and 14.6 billion - the share of public institutions.
At the same time, U.S. investors bought foreign long-term securities totaling $ 22.7 billion
As a result, long-term capital inflows in the U.S. in October amounted to 20.7 billion

Politicians and the Financial Crisis

The same bad language now criticized the bankers for the reckless financial management of their country in the boom years.

Did you notice who the EU during the crisis came on stage and started confidently and with a dramatic lecture financial markets about how frivolous, short-sighted, and rude, they behaved before the financial crisis? These politicians. They immediately and actively began to develop the proposed method for taming the "bad market practices.

It is quite paradoxical. The political elite in most developed democratic countries can hardly serve as an example of care for long-term goals that go beyond the authority and political cycles. In contrast, the ability to see beyond the political elections, by definition, is suppressed in the normal democratic politics. Elections constantly on the horizon, whether they are party, local, national or pan-European. Long-term thinking is in short supply. The actions of politicians can get into the history books, but in order for this to happen, it is necessary to win a series of elections in a short period of time. Long political way - there is nothing more than the sum of failures for short periods of time. Until now, this is consistent with public choice theory, or "economic policy". Therefore, the changes that are so painful in the short term, useful in the long term, but difficult to implement, whether they relate to pensions, health care, labor law or the flexibility of markets at the EU level, the infamous Lisbon strategy, which is the EU's failed attempt to catch up and surpass "United States.

The financial sector is also often criticized for not having been formed airbag in good times for the insurance for the time is not so favorable. And even in this situation, politicians are trying to show off the virtues, citing the previous crisis years of the "great moderation" in the management of the state budget, during which growth has been stable and inflation low.

Nevertheless, from 2000 to 2007, the overwhelming majority of European countries already had a substantial budget deficit. Every way the EU has demonstrated its commitment not to allow participating governments to allow a budget deficit greater than 3% of GDP in bad times. In good times, which is already behind us, the budgets had to be balanced and even create reserves. However, thanks to creative thinking by EU finance ministers, the permissible threshold of this criterion has been changed not only for the bad times, but for good. And even this criterion has been repeatedly violated in many countries, both east and west of the EU (see chart). I read with a smile conclusion ECOFIN (Council of EU Finance Ministers), which virtually every month with a serious face offer a new type of reporting, regulating or controlling a new tool designed to compel financial sector to think about the bad times to the present moment. Often, these are the same ministers who are responsible for the numbers in the chart.

On the one hand, many politicians give scolded bankers for the "herd behavior" that led to the destabilization of the entire market. On the other hand, they write a new directive that will limit the opportunities for banks and other financial institutions in matters of their own making decisions that will lead to greater vysheupmyanutogo "herd behavior". Regulation - there is nothing more than the prescribed behavior "herd." Sometimes it affects positively, sometimes - not. In any case, the same straitjacket can bind and those financial institutions that have not followed the "herd" and came out winners of the crisis.

Moreover, it is ironic that in today's EU new regulatory measures were written and promoted mostly big western countries whose financial systems are most affected by the crisis. Just imagine what would happen if the new financial regulation in Central and Eastern Europe will be written by Latvians.

Just to be clear: I am not among those who default relates to politics with contempt and disdain, and I do not belong to politicians, as beings from another planet. I have a pragmatic point of view, I believe that a certain type of universal rules in the middle leads to similar results and behavior. Public administration - not the exception. That's why I was surprised how cheap a lecture on markets around the world are taken for granted so quickly and without a doubt, while it is easy to see that the proponents of these lessons are experiencing a serious lack of credibility at the point of view that they are preaching.

Mr. Hampl is vice president of the Czech National Bank and a member of the Economic and Financial Committee of the EU.

The Wall Street Journal

Greece defies Europe as EMU crisis turns deadly serious

Revolt in the euro area has begun. Greece became the first country in the impoverished outskirts of the monetary union in Europe, who challenged Brussels and rejecting medieval methods "of treatment with leeches" wage deflation.

While Prime George Papandreou (George Papandreou) formally assured the European Summit, which took place on Friday that Greece would not have defaulted on debt of € 298 billion, in the end, journalists have given those words a different hue.

"Employees will not pay for our actions: we will not freeze or cut wages. We came to power in order to destroy the social structure of the state ", - he said.

We must assume that the countries covered by the anarchist riot and the influence of radical left-wing parties take the risk of its democracy in order to please Brussels?

Papandreou has good reason to throw the gauntlet at the feet of Europe. Greece persuaded to accept a package of IMF austerity without a devaluation, so desired IMF. These measures are ruinous and doomed to failure. Public debt has risen to 113% of GDP. It is assumed that in 2010 the debt will rise to 125% and 140% in 2012.

If Greece will impose draconian wage cuts, which is implemented in full swing in Ireland (5% reduction for ordinary employees and 20% for managers), this will aggravate depression and loss of tax revenue that will continue to decline. It is too late for such a crude policy. Greece has already passed that critical moment when the debt spiral could turn in the right direction.

Ireland is able to implement it, starting with the fact that it has less debt, more flexible labor market and the Nordic discipline. Papandreou faced with circumstances more similar to those faced by the Argentine leaders in 2001, when they tried to cut wages, mistakenly believing that the rejection of the dollar would be catastrophic landmark. Buenos Aires is caught up in riots. The police lost control, killing 27 people. President De la Rua was removed from the Casa Rosado on a military helicopter. Peg to the dollar was canceled, causing the largest default in history.

Economists expected the fall to earth, but this did not happen. Argentina achieved a growth rate of China for 5 years: 8,8% in 2003, 9% in 2004, 9,2% in 2005, 8,5% in 2006 and 8,7% in 2007.

London bankers are lining up to lend money (this is our pension funds?) Argentina, despite a 70% loss the previous creditors.

In theory, Greece could do the same thing: to restore its currency devalue it, to pass a law for the disposition of domestic debt in euros to drachmas, and "restructure" foreign contracts. This is a rather "popular" way. Such actions may allow Greece to withdraw from the vicious circle.

Bondholders will scream, but then they should further examine the work of EMU. RBS said that the UK and Ireland, this situation has the greatest impact, given the 23% of the Greek debt, divided between them (in the majority among global clients.) France owns 11%, Italy 6%.

Remember: Athens prevailed over by Brussels, not vice versa. Out of Greece from EMU would be very dangerous. Regardless of the immediate consequences for Central and Eastern Europe, such developments will affect the agreements that have advanced Integrating all European countries.

I do not want to say that Papandreou - an insider in the EU - thinks so. Full EU membership is necessary for a country that starts from the base of the Balkans, and in the end so close to the inevitable reckoning. However, Papandreou will not conform to European deflationary pact.

Without a doubt, the European institutions will find solutions. RBS said that would take steps in coming days. While the ECB can not save the country, he can buy Greek bonds on the open market. European states may unite to support the Greek loans afloat for some time. But this does not solve anything. This increases the debt of Greece, prolongs the agony. What this country really needs (if not leaving EMU), so this is a permanent subsidies from the North. Portugal and Spain are also in need of assistance.

Danger point for Greece will be a time when the fall of Pf in Berlin that the EMU discrepancy between North and South has been widened to such an extent that the system collapses: Germany suffers inflation, or 4 or 5%, to prevent the immersion of Central Europe into a debt deflation ; or she pays charitable contributions to the South (not loans), equivalent to those paid to East Germany after reunification.

Before you accuse Greece of the fact that it foozled with the euro, let's not forget how we got here. EMU countries of Central Europe were lured into a trap. Interest rates were too small for Greece, Portugal, Spain and Ireland, which was the result of a huge and devastating the building and the salary boom.

ECB has been an accomplice. It does not take into account inflation and M3 money supply was sent to Germany to save her from a sharp downturn. ECB rates were equal to 2% until December 2005. It was poison to the overheated Southern countries.

The deeper truth is that few are prepared to discuss the EU lies in the fact that EMU was originally useless to Greece, to Germany - and for everyone else.

The Telegraph
December 13

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