Saudi Arabia has refused to cut interest rates in lockstep with the US Federal Reserve for the first time, signalling that the oil-rich Gulf kingdom is preparing to break the dollar currency peg in a move that risks setting off a stampede out of the dollar across the Middle East.
"This is a very dangerous situation for the dollar," said Hans Redeker, currency chief at BNP Paribas.
"Saudi Arabia has $800bn (£400bn) in their future generation fund, and the entire region has $3,500bn under management. They face an inflationary threat and do not want to import an interest rate policy set for the recessionary conditions in the United States," he said.
The Saudi central bank said today that it would take "appropriate measures" to halt huge capital inflows into the country, but analysts say this policy is unsustainable and will inevitably lead to the collapse of the dollar peg.
As a close ally of the US, Riyadh has so far tried to stick to the peg, but the link is now destabilising its own economy.
Registered: Mar 2003
Location: Sacramento, California
Fed Reserve hearing with Bernanke and Treasurer Paulson this morning was interesting and Senator Ron Paul bashing them was fun as well. I'm glad there is some opposition to raising caps with Fannie & Freddie. Oh, and Bernanke side stepping the fact that this mess' largest contributor was the fed reserve lowering rates to 1% in 2003 was appalling.
..in other news, the dollar keeps plummeting:
Dollar Falls to Record Low Against Euro on Fed's Rate Outlook
By Min Zeng
Enlarge Image/Details
Sept. 20 (Bloomberg.com)
Losses in the dollar accelerated after London's Daily Telegraph newspaper reported, citing analysts, that Saudi Arabia may drop its currency's link to the dollar. The nation is likely to keep the peg, an adviser to King Abdullah said. The euro rose above $1.40 for the first time since its introduction in 1999. The Canadian dollar earlier equaled its U.S. counterpart.
The U.S. currency fell 1 percent to $1.4093 per euro at 11:24 a.m. in New York and earlier reached $1.4094, the lowest since the European single currency's inception. The U.S. currency has lost 6.4 percent this year versus the euro.
The dollar also fell 1.5 percent to 114.38 yen, and 1.4 percent to 99.91 U.S. cents against the Canadian dollar. The Canadian dollar earlier equaled its U.S. counterpart for the first time since November 1976. The dollar declined 1.2 percent to 1.1696 versus the Swiss franc and earlier touched 1.1693, the weakest since March 2005.
Canadian Dollar Breaks Above Parity Versus the U. S. Dollar
The Canadian dollar has broken above parity with the United States dollar. In New York trading at 10:59 am EDT, it cost 1.0004 US dollars to buy one Canadian dollar.
In May 2004, it cost just 72 cents to buy one Canadian dollar
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The Dollar keeps losing value almost by the day it seems, spiralling downward unstoppable. As ninetynine said, this artificial manipulation by the Fed is only prolonging it's demise. Ron Paul and other economists have been saying that any fiat money system will eventually fail and collapse. You can't keep printing money at will and expect to maintain the economy forever.
Say goodbye to the US dollar and the American way of life and say hello to the Amero.
Sep-20-2007 17:01
ninetyninej
Supreme tranceaddict
Registered: Mar 2003
Location: Sacramento, California
quote:
Originally posted by groovedaddy21
The Dollar keeps losing value almost by the day it seems, spiralling downward unstoppable. As ninetynine said, this artificial manipulation by the Fed is only prolonging it's demise. Ron Paul and other economists have been saying that any fiat money system will eventually fail and collapse. You can't keep printing money at will and expect to maintain the economy forever.
Say goodbye to the US dollar and the American way of life and say hello to the Amero.
You damn right. Thank you for this post and the way our country and economy is going the Amero will inevitable!
In other news....
Dubai wants US regulators to approve buying 20% of the Nasdaq and Bush was asked this morning and didn't really say anything concrete only "we'll see if there are any national security implications."
Of course there are! We can't let the entire Globe OWN us just because we can't manage our economy! Fucking Feds better not allow this.
New America: owned and operated by China, Saudi Arabia, U.K., Dubai(UAE), EuroZone, Switzerland, and Japan!
Nasdaq Expects Regulatory Approval for Dubai Deal (Update1)
By Edgar Ortega and Jesse Westbrook
Sept. 20 (Bloomberg) -- Nasdaq Stock Market Inc., the second-largest U.S. equity exchange, expects to gain U.S. regulatory approval this year for a deal that makes the state- controlled Borse Dubai its biggest shareholder.
Nasdaq announced an agreement today to sell a 19.9 percent stake to the United Arab Emirates' Borse Dubai. While exchange rules would limit Dubai's voting rights in Nasdaq to 5 percent, President George W. Bush and Congressional leaders said they will scrutinize the deal.
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Last edited by ninetyninej on Sep-20-2007 at 17:45
Sep-20-2007 17:32
ninetyninej
Supreme tranceaddict
Registered: Mar 2003
Location: Sacramento, California
New Bill Would Repeal Home Mortgage Exception During Bankruptcy
(housingwire.com)
2007-09-22
"If you work in the mortgage industry, this bill should give you strong pause. "
Oh God, congress is a joke. The residential future is FUCKED. I don't even want to think about what lending and home owning will be like in 5 years.
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Sep-22-2007 22:18
ninetyninej
Supreme tranceaddict
Registered: Mar 2003
Location: Sacramento, California
Predatory borrowers
(boston.com)
2007-09-22
"Like inebriated bar patrons who blame the bartender for serving them too much, a segment of today's borrowers willfully chose to borrow beyond their means and are now blaming the lender." -- We have no pity for such borrowers... this is nothing like the unsophisticated young couple or fixed-income grandmother who were simply put into an ARM instead of a fixed!
"There is little question that truly predatory lenders, whose sole strategy was to dupe unsuspecting and often unsophisticated individuals into borrowing, should be punished. But for those borrowers who mortgaged a lifestyle they knew they could not sustain, the system should not come to their rescue."
Canadian Dollar Breaks Above Parity Versus the U. S. Dollar
The Canadian dollar has broken above parity with the United States dollar. In New York trading at 10:59 am EDT, it cost 1.0004 US dollars to buy one Canadian dollar.
In May 2004, it cost just 72 cents to buy one Canadian dollar
---------
The Dollar keeps losing value almost by the day it seems, spiralling downward unstoppable. As ninetynine said, this artificial manipulation by the Fed is only prolonging it's demise. Ron Paul and other economists have been saying that any fiat money system will eventually fail and collapse. You can't keep printing money at will and expect to maintain the economy forever.
Say goodbye to the US dollar and the American way of life and say hello to the Amero.
This is Scary, looks like the feds are really stuck. Really interested in seeing what the feds do next.
___________________
If you fill your heart with regrets of yesterday and the worries of tomorrow, you have no today to be thankful for.
Sep-24-2007 03:44
ninetyninej
Supreme tranceaddict
Registered: Mar 2003
Location: Sacramento, California
Miami, FL: Housing Crash 50% OFF Condos
California only has a measly 20-40% depreciation.
On this topic, this has to be my favorite and most entertaining site:
Current Foreclosure Crisis Deemed the Worst in U.S. History
2007-09-25
"According to the most recent foreclosure numbers released by the Mortgage Bankers Association (MBA), the U.S. is embroiled in the worst foreclosure crisis in recorded history. More than 14 percent of subprime borrowers are defaulting, and prime borrowers are beginning to follow suit"
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Last edited by ninetyninej on Sep-28-2007 at 06:17
Sep-28-2007 05:39
djGT
pho dac biet xe lua
Registered: Oct 2003
Location: The OC, USA
so the market is tanking today, ouch@!
oh yeah, the house we are renting from is being forclosed on, thanks a lot mr Bubble!
Registered: Mar 2003
Location: Sacramento, California
I have a case of the 'tuesdays' and thought some humor was in order:
Real Homes of Genius: Today we Salute you Hawthorne. $100,000 off Sale of the Millennium.
Today’s specimen is a 1,254 architectural masterpiece with 3 bedrooms 2 baths that was built in 1923. When we talk about the Great Depression, we are talking from experience here. This place is a REO, meaning the bank is now a “motivated seller.” And get this, the seller is actually willing to pay 3 percent toward closing costs! Talk about a different world. Last year, you were lucky if you got a free orange plastic cup for closing on a home. Again we are seeing a fascinating display in yellow, green, and dirt landscaping here. Why not Photoshop the grass green? A cheap intro marketing class or photography course at your local community college should be a prerequisite for future agents. I know you are itching for the price and have your phone on speed dial to schedule an appointment. This place is all your’s for the rock bottom price of $520,000. This is an absolute steal when we look at the sales data:
Numerous tips have come in regarding the apparent closure of the Whole Lending Division of Bank of America. Account Reps are already sending out farewell notices:
"It is with much sadness that I write to inform you that Bank of America has opted to close its Wholesale Channel effective December 31, 2007. This is a bank strategy to become number one in direct to consumer... I do not have much information at this time but it is my understanding that all loans in the pipeline will be honored and we will continue business as usual for an additional thirty days from the date of this announcement."
Big news across most major newspapers today, B of A announced it is laying off 3,000 employees, approximately 2 percent of their workforce. From Google News and the Associated Press:
"The job cuts, which the company said come "in light of market conditions and strategic imperatives," are throughout the bank, but the majority are in areas such as business lending, treasury services, and capital markets and advisory services, as well as support staff."
We will update this during the day. We are looking for hard copy on this, so please email us information as it becomes available. Thank you.
EDIT:
I hope this doesn't mean the rumors are true that wholesale lending will be gone by next year. Since banks/mortgage lenders are having an even harder time selling mortgage securities from the wholesale side since they are originated by brokers and have a higher fraud and default rate as opposed to retail/in-house originated loans.
