NEWS
· North Korea reported to have missile set for launch. U.S. officials would not confirm the report but did not dispute it. Kyodo, citing "sources close to Japan-U.S. relations," said the missile had been placed at Musudan-ri, a site that has been used for previous missile tests. "I'm not going to steer you away from what's been reported," a U.S. counter-proliferation official told Reuters. Another U.S. official, also speaking on condition of anonymity, said North Korea had stacked together two stages of what is expected to be a three-stage rocket. North Korea has said it would launch a satellite between April 4-8. Regional powers see the launch as a disguised test of its longest-range missile and a violation of U.N. sanctions forbidding the reclusive state from firing ballistic missiles. North Korea has given international agencies notice of the rocket's planned trajectory that would take it over Japan, dropping booster stages to its east and west. "Even though the North Koreans have made a public declaration that this is a space launch, it would be in violation of the U.N. Security Council Resolution 1718," Pentagon press secretary Geoff Morrell said. "Therefore, we would, of course, oppose it." The first and only time the North test-launched the Taepodong-2 in 2006, it fizzled shortly into flight and blew apart after about 40 seconds.
· Moody’s downgrades BofA and Wells Fargo. Moody's Investors Service on Wednesday cut its ratings on Wells Fargo & Co's and Bank of America's debt and downgraded the preferred shares of both banks into junk territory. The preferred shares were cut on the potential for government intervention to suspend payments on the securities if the banks' capital ratios further decline, Moody's said. Moody's slashed Wells Fargo's preferred stock nine notches to B2, five steps below investment grade, from A2, and cut Bank of America's preferred shares eight notches to B3, six steps below investment grade, from Baa1. Wells Fargo's senior subordinated debt rating was also cut one step to A2, the sixth-highest investment grade, from A1 and its junior subordinated debt rating was lowered one step to A3. The preferred stock downgrades reflects concerns that "capital ratios could come under pressure in the short term, increasing the probability that systemic support will be needed," Moody's said in a statement. Ratings on the banks' senior debt, however, reflect "very high" systemic support, Moody's added. "Such support, however, could be potentially harmful to preferred stock investors."
· FDIC Bair:FDIC should get authority to wind down big firms Sheila Bair, chairman of the Federal Deposit Insurance Corp, said on Wednesday "it would make sense on many levels" for her agency to be given the authority to wind down troubled non-bank financial firms. Bair said in a statement that she supports the U.S. Treasury Department's legislative proposal that would give Treasury the power to seize large distressed financial firms. The proposal -- released on Wednesday -- said the FDIC could be given funds to help wind down those firms. "Due to the FDIC's extensive experience with resolving failed institutions and the cyclical nature of resolution work, it would make sense on many levels for the FDIC to be given this authority working in close cooperation with the Treasury and the Federal Reserve Board of Governors," Bair said. The FDIC currently has the authority to wind down failed banks, but does not have powers over other types of financial firms such as bank holding companies or insurers.
· San Fran FED Yellen: China’s concern over USD “understandable.” San Francisco Federal Reserve Bank president Janet Yellen said on Wednesday that China’s concern was “understandable, adding China's proposal to use the IMF's Special Drawing Right more widely is "far from practical". "It's quite understandable that country would be concerned" about the dollar due to the lack of diversification of its holdings, Yellen said in response to questions after a speech at the Forecaster's Club of New York. China's central bank governor said earlier this month the world should consider the International Monetary Fund's SDR -- a basket of dollars, euros, sterling and yen -- as a super-sovereign reserve currency. Yellen said the proposal was "interesting," but that the idea was "far from being a practical alternative" at this point. Answering a separate question, Yellen said she was "stunned by the magnitude of the collapse in global trade." She said the global nature of the economic downturn meant a rebound would be much harder as recoveries from past crises, such as the Asian crisis, were often driven by a pick-up in trade. "The fact this is a global downturn is very very challenging. I don't think we've ever seen it before," Yellen said. She said the Fed has sufficient tools to withdraw liquidity from the system, such as paying interest on reserves, once the economy recovers, but said she would be happier if Congress gave the Fed the authority to issue its own debt. Yellen is a voting member of the Fed's policy-setting committee this year. Asked about the outlook for banks, she said they continue to face a challenging environment. "If the downturn remains severe there will be other categories of loans where we see delinquencies," she said. "We can't say all the losses are behind us." Sphere: Related Content
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1 comments:
I honestly believe like those who feel the worst is behind us should really look at the rise in the unemployment rate and the continuing claims at a time when Americans must rebuild their balance sheets. This must be done by cutting spending and not going out and borrow "like crazy" thank you Dr. Romer.
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