Our blog's intention is to request the US government to grant us a chance to defend our mother country Japan at the American court of law regarding the resolution "Comfort Women" passed July 30, 07.


aquino china trip 8.31.11

南シナ海の領土領海を巡って、フィリピンと中国は争っている。新大統領のベニーノ・アキノは、グロリア・アロヨ大統領が腐敗政治で負われた後釜に座った。250人のビジネスマンを連れた北京訪問は、商用なのだ。フィリピンが主張する領海の海底油田と引き換えに、中国の投資を誘致するというアイデアなのだ。フィリピンのインフラは目も当てられない状態だ。中国が電力~道路~橋~空港などに投資するなら、海底油田の掘削権を与えるというものである。問題がある。それは、アキノ大統領は、フィリピンの安全保障をUSに頼んでいるからだ。ヒラリーは保障したが、当然、アキノが勝手なことをするのを許さない。それは、ベトナムやマレーシア、究極的には、台湾の安全保障に影響をw与えるからである。伊勢平次郎 ルイジアナ

Aquino Seeks $60B, Oil Resolution on China Trip

By Bloomberg News - Aug 30, 2011 9:43 PM CT .

Benigno Aquino, president of the Philippines, speaks during an interview in Malacanang Palace in Manila, the Philippines, on Wednesday, Aug. 17, 2011.

Aug. 31 (Bloomberg) -- Jose Camacho, Asia vice chairman at Credit Suisse Group and a former Philippine finance secretary, talks about the nation's relations with China. Philippine President Benigno Aquino arrived in China on his first state visit to the country, aiming to win as much as $60 billion in investments and resolve tensions over oil exploration in the disputed South China Sea. Camacho, who also discusses the Philippine economy, speaks from Singapore with John Dawson on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)

 Philippine President Benigno Aquino arrived in China on his first state visit to the country, aiming to win as much as $60 billion in investments and resolve tensions over oil exploration in the disputed South China Sea.

Aquino’s arrival in Beijing last night to head a trade delegation of about 250 businessmen follows months of sparring with China over rights to exploit energy resources in waters they both claim. The Philippine leader yesterday said he’ll discuss how to end the conflict, which was rekindled in March when Chinese vessels chased away a Forum Energy Pcl survey ship.

Disagreements over the South China Sea have sparked verbal clashes between China and the U.S., which has a defense treaty with the Philippines. Aquino has sought to balance reliance on the U.S. for security with the need for closer ties to China, his nation’s largest trading partner and potential source of funds for the roads, ports and other infrastructure needed to revive economic growth.

“The Philippines is badly in need of foreign direct investments, particularly in infrastructure,” Jose Camacho, Asia vice chairman at Credit Suisse Group AG and a former Philippines’ finance minister, told Bloomberg Television today. “The best result for President Aquino is a general good feeling between the Philippines and China so we can then start seeing investments of Chinese companies in the Philippines.”

China, which claims almost all of the South China Sea, has resisted U.S. efforts to broker a regional solution. Secretary of State Hillary Clinton last year declared a national interest in the waters, a statement the Foreign Ministry in Beijing called “virtually an attack on China.”

‘China Can Help’

“The Philippines needs America for security and at the same time it’s aware that China can help the Philippine economy,” said Benito Lim, a political science professor at Ateneo de Manila University. “It appears Mr. Aquino considers other issues more important than the differences in the South China Sea.”

Aquino will meet with President Hu Jintao, Premier Wen Jiabao and Vice Premier Wang Qishan during the five-day visit. He is also due to meet officials from State Grid Corp. of China and $410 billion sovereign wealth fund China Investment Corp. After Beijing, he travels to Shanghai.

“We will not pass up on this opportunity to meet with businessmen in China,” Aquino told reporters in Manila yesterday before heading to Beijing, according to a copy of his remarks sent to reporters. “Our country is open for business.”

Aquino is making the first state visit by a Philippine leader since Gloria Arroyo’s in 2004, which paved the way for an agreement on joint seismic surveys in disputed waters between the Philippines, China and Vietnam. That accord was abandoned on concerns it may have been unconstitutional.

A Senate probe of a $329 million contract Arroyo awarded to Shenzhen, China-based telecommunications company ZTE Corp. (000063), prompted her to cancel the project.

‘Corruption Allegations’

Arroyo “put the South China Sea issue on the backburner in return for these huge infrastructure and investment deals from China, all of which collapsed under the weight of corruption allegations,” said Ian Storey, a fellow at the Institute of Southeast Asia Studies in Singapore. “Aquino will be very keen to avoid a repeat of that.”

The Philippines may secure as much as $60 billion in Chinese investments under a five-year plan to be signed during Aquino’s stay, Christine Ortega, assistant secretary for foreign affairs, told reporters in Manila on Aug. 24. This trip alone may bring $7 billion in commitments, Trade Undersecretary Cristino Panlilio told reporters in Beijing yesterday.

“We try our best to reach the investment audience, but there’s nothing like a presidential trip,” he said.

Ricky Carandang, Aquino’s spokesman, yesterday said the investment projections were “rough figures” and the final number remained unknown.

‘Ready and Willing’

China is “ready and willing to add power to the winds” of the Philippine economy, Chinese Ambassador Liu Jianchao told reporters in Manila on Aug. 24. Philippine exports to China have more than doubled since January 2009. Two-way trade, including Hong Kong, reached $16.1 billion last year, eclipsing Japanese and U.S. commerce with the Philippines, government statistics show.

Aquino is counting on investments to boost economic growth that slowed for a fourth straight quarter. Gross domestic product increased 3.4 percent in the three months through June from a year earlier, from a revised 4.6 percent in the first quarter, the National Statistical Coordination Board said today.

Lagging Investments

Net foreign direct investment in the Philippines fell 13 percent to $1.7 billion in 2010 from a year earlier, the central bank said in March. Between 1970 to 2009, the country lured $32.3 billion in FDI, compared with $104.1 billion for Thailand, according to United Nations data.

Higher returns on investments will come from resources “that have been untapped for such a long time,” Aquino said in an Aug. 18 interview, citing plans to explore for energy in the South China Sea. Two of 15 blocks put out for tender in June are in waters China claims.

The Philippines plans to boost hydrocarbon reserves by 40 percent in the next two decades. Mineral fuels accounted for 17 percent of total monthly imports on average last year, from 11 percent in 2000, data compiled by Bloomberg show.

“We want to resolve the conflicting claims so that we can have our own gas,” Aquino said Aug. 29. “Once we have our own, we will not be affected by events in other parts of the world.”

To contact the reporters on this story: Daniel Ten Kate in Bangkok at; Joel Guinto in Beijing at



China Calls U.S. Report on Military Strength ‘Cock-and-Bull’

By Bloomberg News - Aug 26, 2011 5:40 AM CT .

...China said a U.S. report on its military “severely distorted the facts” by portraying the country as a threat to regional peace, with the official Xinhua News Agency describing it as a “cock-and-bull” story.

China’s military continued to improve its capabilities for a potential conflict with Taiwan “even as cross-Strait relations have improved,” the Pentagon said in the report released Aug. 24. The goal is “to deter Taiwan independence and influence Taiwan to settle the disputes on Beijing’s terms.”

China’s defense ministry said the report played up the threat to Taiwan. “China unswervingly adheres to the path of peaceful development, and its national defense policy is defensive in nature,” Xinhua cited Yang Yujun, a spokesman for the deparment, as saying.

The report to Congress is an annual point of tension between the world’s two biggest economies, whose leaders have pushed to improve military and diplomatic ties. U.S. Vice President Joe Biden spent four days last week traveling in China with his counterpart Xi Jinping in a visit aimed at building ties with the next generation of Chinese leaders.

The U.S. has the world’s biggest military budget, with more than $600 billion in annual spending, and has more than 60,000 service personnel in Asia. China’s defense spending ranks second in the world, and its maritime forces are an increased presence in seas that the U.S. patrols. This year China plans to spend 601.2 billion yuan ($94.1 billion) on defense, the government announced in March.

‘Stabilizing Force’
The Pentagon report was released the same day Biden told American troops in Japan that China’s economic growth was made possible by the U.S. military presence in the region.

The U.S. is “a stabilizing force in the Pacific Basin,” he told the troops. “An American focus in Asia is only going to grow in the years to come as Asia plays an ever-increasing role, particularly in the global economy but also in international affairs.”

U.S. claims that China’s naval expansion had implications for the regional balance of power were “based on a wild guess and illogical reasoning,” Xinhua said. “The allegation is an utterly cock-and-bull story.”

As of December, the People’s Liberation Army had deployed between 1,000 and 1,200 short-range ballistic missiles to units opposite Taiwan, the Pentagon report said. These included missiles with improved ranges, accuracies and payloads, it said.

Expanding Military
“Relations have continued to improve over the past couple of years, but, despite this political warming, China’s military shows no signs of slowing its effort to prepare for a cross- Strait contingency,” Deputy Assistant Secretary of Defense for East Asia Michael Schiffer told reporters at the Pentagon on Aug. 24.

China’s military, besides its Taiwan focus, is expanding its capability for missions as far away as the Indian Ocean and further into the Pacific region, according to the Pentagon.

“China’s sustained military investments have allowed China to pursue capabilities that are potentially destabilizing to regional military balances,” the report said.

In the past year, “China made strides toward fielding an operational anti-ship ballistic missile, continued work on its aircraft carrier and finalized the prototype of its first stealth aircraft,” the report said.

The report said the anti-ship missile, the DF-21D, has a range exceeding 1,500 kilometers (932 miles) and a maneuverable warhead designed to provide “the capability to attack large ships, including aircraft carriers, in the western Pacific.”

Taiwan Sales
Tensions rose last year after the U.S. announced plans in January to sell $6.4 billion of missiles, helicopters and ships to Taiwan, which China considers a renegade province that should be reunited with the mainland by force if necessary.

China broke off military-to-military talks with the U.S. until late 2010, ahead of visits by former Defense Secretary Robert Gates to Beijing in January this year and Chinese President Hu Jintao’s state visit to the U.S. that same month.

Chinese General Chen Bingde, chief of staff of the People’s Liberation Army, visited the U.S. in May, further driving efforts to improve ties.

To contact the editor responsible for this story: Peter Hirschberg at



Bernanke 8.26.11

Bernanke Doesn’t Signal More Stimulus

バーナンキ米連邦準備理事会(FRB)議長は、新しい政策を出さなかった。量的緩和(QE3)を期待していた株式市場は、朝200ポイントまで下げた。だが、昼前には落ち着きを取り戻して、現在は150ポイントの青信号だ。乱高下だが、バーナンキ議長の動かぬし姿背を評価したとい言えるだろう。議長は、“ファンダメンタルの問題は、巨大な累積赤字が経済を危険にしている~FRBは政治に口を出せない立場だが、財政を再建するのは、大統領府と米国議会の仕事だ~自分ができることはして来た~また、どうしても必要なら、量的緩和の手が残っている”と、世界中が待ちに待っていた声明を終えたのだ。次回は、9月20と21日の、Federal Open Market Committee (FOMC) 会議であると。伊勢平次郎 ルイジアナ


By Jeannine Aversa and Scott Lanman - Aug 26, 2011 10:13 AM CT .

Aug. 26 (Bloomberg) -- Kevin Hassett, director of economic policy studies at American Enterprise Institute, talks about Federal Reserve Chairman Ben S. Bernanke's speech today at the Kansas City Fed's annual symposium in Jackson Hole, Wyoming. Bernanke sought to reassure investors that the Fed still has tools to aid the recovery if needed, but he stopped short of indicating that the central bank will move ahead with a third round of government bond-buying. Hassett speaks on Bloomberg Television's "InBusiness With Margaret Brennan." (Source: Bloomberg)

Aug. 26 (Bloomberg) -- Allen Sinai, chief global economist at Decision Economics Inc., talks about Federal Reserve Chairman Ben S. Bernanke's speech today at the Kansas City Fed's annual symposium in Jackson Hole, Wyoming. Sinai speaks with Michael McKee from Jackson Hole on Bloomberg Television's "InBusiness with Margaret Brennan." (Source: Bloomberg)

Aug. 26 (Bloomberg) -- Mark Zandi, chief economist at Moody's Analytics Inc., talks about Federal Reserve Chairman Ben S. Bernanke's speech at Jackson Hole, Wyoming. He speaks from Pennsylvania with Francine Lacqua on Bloomberg Television's "Last Word." (Source: Bloomberg)

Aug. 26 (Bloomberg) -- Federal Reserve Chairman Ben S. Bernanke said the central bank still has tools to stimulate the economy without providing details or signaling when or whether policy makers might deploy them. In a speech today to central bankers and economists gathered at an annual forum in Jackson Hole, Wyoming, Bernanke also said a second day has been added to the next Fed policy meeting in September to "allow a fuller discussion." Michael McKee reports on Bloomberg Television's "InBusiness With Margaret Brennan." (Source: Bloomberg)

Aug. 26 (Bloomberg) -- Richard DeKaser, an economist at the Parthenon Group, discusses Federal Reserve Chairman Ben S. Bernanke's speech today at the Kansas City Fed's annual forum in Jackson Hole, Wyoming. Bernanke said the central bank has tools to stimulate the economy without providing details or signaling when or whether policy makers might deploy them. DeKaser speaks with Margaret Brennan and Dominic Chu on Bloomberg Television's "InBusiness With Margaret Brennan." (Source: Bloomberg)
Federal Reserve Chairman Ben S. Bernanke said the central bank still has tools to stimulate the economy without providing details or signaling when or whether policy makers might deploy them.

“In addition to refining our forward guidance, the Federal Reserve has a range of tools that could be used to provide additional monetary stimulus,” Bernanke said in a speech today to central bankers and economists gathered at an annual forum in Jackson Hole, Wyoming. He said a second day has been added to the next policy meeting in September to “allow a fuller discussion” of the economy and the Fed’s possible response.

While Bernanke sought to reassure investors and the public that U.S. growth is safe in the long run and that the Fed still has tools to aid the recovery if needed, he stopped short of indicating that the central bank will move ahead with a third round of government bond-buying.

“Although important problems certainly exist, the growth fundamentals of the United States do not appear to have been permanently altered by the shocks of the past four years,” Bernanke said in prepared comments at the mountainside symposium hosted by the Kansas City Fed. “It may take some time, but we can reasonably expect to see a return to growth rates and employment levels consistent with those underlying fundamentals.”


Ben Bernanke unlikely to announce big new plans at Jackson Hole


今日8月23日の火曜日、NY市場は、QE3を期待して、ダウ平均が322ポイントも上がった。だが、米連邦準備委員会(FRB)の理事たちは、米経済が失調している原因を違った目で見ているのだ。原因の最大は、財政赤字だとである。現在、新住宅が売れない~製造業受注が減ったと二番底が近寄っているのだが、バーナンキ議長は、“近未来及び長期の経済展望”という表題でスピーチをするのだと。これは、量的緩和に消極的という意味だ。多分、満期となった国債10年モノを30年モノにロールオーバーするぐらいだろう。それでも、2年以上は、貸し出し金利を低く抑えて置クコとが出来る。住宅ローンや、自動車ローンや、クレジットカードの金利を極低く据え置く考えなのだ。伊勢平次郎 ルイジアナ

By Neil Irwin, Tuesday, August 23, 7:45 PM

This time a year ago, Federal Reserve Chairman Ben S. Bernanke headed to an annual gathering of central bankers in Jackson Hole, Wyo., amid a faltering U.S. economy, a perilous global situation, and rising calls on Wall Street for the Fed to do something to address both.

Here we go again.

Aug. 22 (Bloomberg) -- The Federal Reserve's unprecedented effort to keep the economy from plunging into depression included lending banks and other companies as much as $1.2 trillion of public money. The largest borrower, Morgan Stanley, got as much as $107.3 billion, while Citigroup Inc. took $99.5 billion and Bank of America Corp. $91.4 billion, according to a Bloomberg News compilation of data obtained through Freedom of Information Act requests, months of litigation and an act of Congress. Erik Schatzker and Sara Eisen report on Bloomberg Television's "InsideTrack." (Source: Bloomberg)

Aug. 23 (Bloomberg) -- Julian Callow, chief European economist at Barclays Capital, talks about the possibility of additional quantitative easing by the Federal Reserve and the European debt crisis. He speaks with Francine Lacqua on Bloomberg Television's "On the Move." (Source: Bloomberg)


Bernanke is to deliver a speech Friday morning in the same ballroom in the shadow of the Grand Teton mountains where last year he gave a speech that laid the groundwork for a $600 billion program of bond purchases aimed at lifting the economy. The financial world is obsessing over the possibility of another go-round. The thought that Bernanke may offer hints of new steps to boost growth contributed to big gains on Wall Street Tuesday, with the Standard & Poor’s 500-stock index up 3.4 percent.

But those expecting that Bernanke will unveil any big plans are likely getting ahead of themselves. He and other Fed leaders view the current signs of economic weakness differently from how they viewed the economy this time a year ago and want to see more evidence before making their next move.

“He will explain what the Fed has done and the costs and benefits of its remaining policy options,” Michael Feroli, chief U.S. economist at J.P. Morgan Chase, said in a research note. “But we would expect him to leave it at that, and not forcefully signal that a given course of action has already been decided upon.”

Like this time last year, the economic outlook has been deteriorating, and the risk of a dip back into recession rising. On Tuesday, the Commerce Department reported that new- home sales fell to their lowest level in five months in July, and the Federal Reserve Bank of Richmond said its index of manufacturing activity plummeted.

But some other indicators in recent weeks have flashed more positive signs, including encouraging figures for industrial production in July. And unlike last year, recent readings on inflation have come in not far from the 2 percent or so annual level that the Fed seeks. (Last year, inflation was viewed as too low).

The appetite within the Fed for another big, splashy round of so-called QE3 ? another bond purchase program in the hundreds of billions of dollars ? is low. Many at the Fed are skeptical about the power of further bond purchases to improve the nation’s growth prospects in any significant way.

And there is resistance at the Fed, from Bernanke down, toward more radical measures, such as increasing the central bank’s inflation target. Increasing the target would allow the Fed to pursue expansionary policies, which aim to stimulate the economy, for a longer time without worrying about inflation.

Bernanke may show more openness to modest steps to try to bolster growth, such as reinvesting its current bond holdings into longer-term securities, which could have the effect of helping push down mortgage rates and long-term corporate borrowing.

Even such modest steps could face internal opposition at the Fed. When the central bank’s policy committee decided in early August to say it expects to keep interest rates very low for the next two years, three officials dissented from the decision ? the most to dissent since 1992.

In hindsight, last year’s Jackson Hole speech by Bernanke looked like the first step toward the $600 billion QE2 program. But at the time, it was viewed more tentatively; he wasn’t pledging to undertake a program, merely saying that the Fed was willing to do so if the economic data justified it.

After outlining the Fed’s options last August at the annual economic symposium sponsored by the Federal Reserve Bank of Kansas City, Bernanke said that “any deployment of these options requires a careful comparison of benefit and cost.”

In this year’s speech, he is likely to put particular emphasis on what needs to be done to repair the U.S. economy over the longer run, including lowering long-term deficits. The title of the speech, in fact, is “Near- and Long-Term Prospects for the U.S. Economy.”

While Bernanke has said that Congress should not cut the budget deficit too quickly, lest this austerity undermine the weak economic recovery, he has previously argued that a long-term plan to put the government’s spending in line with its revenue could help instill confidence. Indeed, Deutsche Bank chief economist Peter Hooper said in a research note that the need for longer-term adjustments in the economy could be another argument against new Fed intervention.

“Any action the Fed takes at this point may give the markets no more than a temporary lift and would not resolve the more fundamental problems that are weighing on the economy,” Hooper said.


Oil Climbs From Two-Day Low as Drop in U.S. Fuel Stockpiles Signals Demand

“NY市場で二日間下落した原油の先物価格が上げている。備蓄が減り~工場生産が上がったからだ。米国は世界一、オイルを消費する国だ” 英語ですが、よく読んでください。オイルの行方が人類の生存に大きく関わるからです。伊勢 ルイジアナ

By Ben Sharples - Aug 16, 2011 5:53 PM CT .

Oil advanced from a two-day low in New York as investors bet that shrinking stockpiles and rising factory output in the U.S. indicate fuel demand will increase in the world’s biggest crude-consuming nation.

Futures climbed as much as 0.7 percent today after the industry-funded American Petroleum Institute said gasoline supplies fell the most in almost five months. Distillate-fuel inventories, a category that includes heating oil and diesel, also declined. Manufacturers in the U.S. churned out more cars, computers and furniture in July, Federal Reserve data showed.

Crude for September delivery rose as much as 56 cents to $87.21 a barrel in electronic trading on the New York Mercantile Exchange and was at $87.06 at 8:52 a.m. Sydney time. The contract yesterday slipped 1.4 percent to $86.65, the lowest since Aug. 12. Prices are 15 percent higher the past year.

Brent oil for September settlement fell 44 cents, or 0.4 percent, to end the session at $109.47 a barrel on the ICE Futures Europe in London. The September contract expired yesterday. October oil dropped 71 cents to $109.13.

Gasoline stockpiles fell 5.37 million barrels to 205.8 million last week, according to a report from the American Petroleum Institute. It was the biggest decline since the week ended March 18. Distillate supplies slid 1.29 million barrels.

U.S. crude-oil inventories rose 1.75 million barrels, the API data showed. An Energy Department report today may show supplies slipped 500,000 barrels, according to a Bloomberg News survey of analysts.

Industrial production climbed 0.9 percent in July, the biggest increase this year, according to a report by the Federal Reserve in Washington. The gain was almost twice the 0.5 percent median forecast in a Bloomberg News survey of economists. Housing starts declined less than expected, another report showed.



Soft Patch Delusion Is Dashed: Roubini

Published: Monday, 8 Aug 2011 | 5:11 AM ET

By: Patrick Allen

Influential economist Nouriel Roubini has warned hopes that the recent slowdown was temporary have been dashed and predicted the US and other advanced economies will have a second “severe recession ”.

Writing in Monday’s Financial Times, the founder of Roubini Global Economics said: “America’s recent data have been lousy: there has been little job creation, weak growth and flat consumption and manufacturing production. Housing remains depressed. Consumer, business and investor confidence has been falling, and will now fall further.”

In the euro [EUR=X 1.4235 -0.0004 (-0.03%) ] zone Roubini notes that peripheral economies are contracting, while the rest are hardly growing and the UK is flat.

“Even worse, leading indicators of global manufacturing are slowing sharply—both in the emerging economies like China, India and Brazil, and export-oriented or resource-rich countries such as Germany and Australia,” Roubini wrote.

“The misguided decision by Standard & Poor’s [SKUL 15.86 0.22 (+1.41%) ]to downgrade the US at a time of such severe market turmoil and economic weakness only increases the chances of a double dip and even larger fiscal deficits.”

More on
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“Hopes for quantitative easing will be constrained by inflation that is well above target levels across the West," he added. The Federal Reserve will probably start a third round of QE, but it will be too little too late.”

Roubini believes the best bet for those who can still borrow is to introduce new short term stimulus measures, whilst committing to medium term austerity.

“The US downgrade will hasten demands for fiscal reduction, but America in particular should commit to look for significant cuts in the medium term, not an immediate fiscal drag that will worsen growth and deficits.”

“Since this is a crisis of solvency as well as liquidity, orderly debt restructuring must begin," said Roubini.

"This means across-the-board reduction on the mortgage debt for the roughly half of America’s households that are underwater, and bail-ins for creditors of banks in distress.”


Fed May Boost Stimulus Pledge

By Jeannine Aversa and Scott Lanman - Aug 9, 2011 6:41

Federal Reserve officials may strengthen their commitment to record monetary stimulus as soon as today after a faltering economic recovery and a U.S. credit- rating cut provoked a rout in global stocks.

By a 52 percent to 48 percent margin, respondents in a Bloomberg News survey said the Fed would ease policy this year through monetary tools or statement language. If the central bank acts, 59 percent said it would communicate that the federal funds rate, balance sheet or both will remain especially stimulative for a longer period or more specific amount of time.

Chairman Ben S. Bernanke and his colleagues are weighing the use of more untested policy tools after two rounds of bond buying totaling $2.3 trillion failed to spur sufficient economic growth and reduce unemployment below 9 percent. The Federal Open Market Committee holds its regular meeting today in Washington following the worst day for U.S. stocks since December 2008.

“The odds of more dramatic action are higher,” said Vincent Reinhart, a former chief monetary policy strategist at the Fed. “However, they might not want to be seen as responding so directly to equity prices,” Reinhart said, adding that policy makers may wait to signal a new round of bond purchases until Bernanke gives a speech on Aug. 26 at a Fed conference at Jackson Hole, Wyoming. Reinhart is a resident scholar at the American Enterprise Institute in Washington.

Stay at Record

The FOMC plans to issue a statement at about 2:15 p.m. New York time. Julia Coronado, chief economist for North America for BNP Paribas in New York, said the central bank may say today the economic slowdown is persisting longer than expected. Policy makers may also say the Fed’s securities portfolio will remain at a record for an “extended period” and replace shorter-term securities with longer maturities to reduce rates on longer-term debt, she said.

The Fed reiterated in June that the overnight interbank lending rate would be “exceptionally low” for an “extended period” and said the policy of reinvesting maturing securities to keep the balance sheet steady would be maintained, without saying how long.

The “extended period” phrase means that the FOMC is at least two or three meetings away, or “significantly longer,” from taking any action, Bernanke said at a June press conference.

Bernanke isn’t scheduled to hold a press briefing today, unlike after the June 21-22 policy meeting. He holds news conferences only after two-day meetings, when the Fed releases updated economic forecasts. Forecasts are next scheduled for release after the Nov. 1-2 gathering. On such days, the Fed releases its announcement at around 12:30 p.m.

Debt Crisis

The drop in global stocks, further fueled by concerns over Europe’s debt crisis, adds to pressure on the Fed, which is confronting a slowing U.S. economy and unemployment stuck above 9 percent.

The Standard & Poor’s 500 Index tumbled 6.7 percent yesterday to 1,119.46 in New York trading, its biggest decline since December 2008.

Today, U.S. stock index futures rose, European shares erased losses and Treasuries fell.

Standard & Poor’s 500 Index futures added 2.3 percent at 7:23 a.m. in New York, after losing as much as 3.2 percent. The Stoxx Europe 600 Index gained 0.4 percent, reversing declines of as much as 5.1 percent. Treasuries, the benchmarks for the $34 trillion U.S. debt market that is more than twice the value of American equities, fell. The 10-year note yield was up eight basis points at 2.40 percent.

Asked which step the Fed would most likely take first, 59 percent of 51 respondents said the central bank would alter language in the FOMC statement.

Deposits on Reserves

Another 22 percent said the Fed would increase the average maturity of its securities holdings, 18 percent said it would buy more assets and 12 percent see the Fed lowering the 0.25 percent interest rate paid on banks’ excess reserve deposits. The total exceeds 100 percent because some economists said the first step would involve two actions.

Economists were divided on whether the Fed would act now, with 35 percent of 46 respondents saying the easing step would come today and 39 percent predicting a move at the next meeting Sept. 20. Fifteen percent saw a potential decision at the Nov. 1-2 meeting, and the remaining 11 percent said sometime after the Dec. 13 session.

The Fed is likely to start a third round of asset purchases, and “they certainly should do something right away,” said Kenneth Rogoff, a Harvard University economics professor and former Fed researcher who attended graduate school with Bernanke. It’s not clear if Bernanke would have the support of the Federal Open Market Committee, Rogoff said.

‘More Decisively’

“It’s going to move more decisively” than in the first two rounds, Rogoff said in an interview with Bloomberg Television. He recommended the Fed say it’s trying to create “moderate inflation” and avoid repeating that officials are trying to boost stocks.

The survey of 58 economists was conducted Aug. 5-8 by e- mail and completed at around noon yesterday. Given the opportunity to change answers after S&P cut the U.S.’s AAA credit rating on Aug. 5, one respondent altered a forecast.

The Fed’s meeting comes two days after central bankers and finance ministers from the Group of Seven nations pledged to “take all necessary measures to support financial stability and growth.” The officials said they would pump money into the global economy and take other steps if warranted.

G-7 Statement

The G-7 statement followed a pledge by the European Central Bank to “actively implement” its bond-purchase program. The ECB started buying Italian and Spanish assets yesterday in its riskiest attempt yet to tame the continent’s sovereign debt crisis.

While Fed officials may weigh whether to undertake a third round of government bond purchases to spur growth, they probably won’t announce a new program today, respondents said. In fact, a majority of economists said in the Bloomberg survey that a third round of quantitative easing won’t happen.

Forty-two percent of 52 respondents said more bond purchases are very unlikely, and 29 percent see them as somewhat unlikely. Of the 29 percent who see such a move as likely, 13 percent say the probability is more than 75 percent, and 15 percent say the chance is 50 percent to 75 percent. In Bloomberg’s June survey, 7 percent of analysts said a third round of bond buying, or QE3, was likely.

Panic Threat

Such a step may backfire because it could panic investors by signaling the economy is in worse shape than the Fed thought, said Lynn Reaser, chief economist at Point Loma Nazarene University in San Diego, California, and a board member of the National Association for Business Economics.

The Fed in June completed a $600 billion Treasury bond- purchase program aimed at reducing long-term borrowing costs on everything from car loans to mortgages and boosting share prices.

Even with the purchases, the economy grew in the first six months of this year at the weakest pace since the recovery started in 2009. After almost stalling at a 0.4 percent annual pace in the first three months of this year, the economy expanded at a 1.3 percent rate last quarter, the government reported on July 29.

“I’m sure they’re facing a tough decision here about what steps they should take,” said Scott Brown, chief economist at Raymond James & Associates Inc. in St. Petersburg, Florida. “These things are kind of marginal at this point, but every little bit would help.”

To contact the reporters on this story: Jeannine Aversa in Washington at; Scott Lanman in Washington at


U.S. Debt Deal Kills Off Prospects of Renewable-Power Support

再生可能エネルギーとは、管直人が大好きな風車~太陽熱パネル~地熱発電のことだ。米国財政委員会は、再生エネルギーへの政府援助を打ち切る。財政再建のために、政府支出は大きくカットされるからだ。当たり前のことだ。中国は原発を起動した。次々と起動させるであろう。経済に電力ほど重要な要素はないからだ。インド~韓国~旧ソ連衛星国~アメリカ、、みんな電力増加に真剣に取り組んでいる。福島で懲りたか、日本人はそうじゃないようだ。伊勢平次郎 ルイジアナ

By Jim Efstathiou Jr. and Christopher Martin - Aug 5, 2011 9:47 AM CT .

The Treasury Department has paid out $7.78 billion in grants to developers of wind, solar, biomass and geothermal energy under an incentive created in the stimulus bill and expires at the end of the year. Photo: Daniel Acker/Bloomberg
Chart: Debt Plan May Limit Renewable Energy Funds .U.S. government support for renewable energy may plunge from record levels, setting back the use of wind and solar power before they can compete on their own with oil, gas and coal.

Direct spending, tax breaks and research funding pushed federal renewable-energy subsidies to $14.7 billion in 2010, according to Alan Beamon, director of the Energy Information Administration’s Office of Electric, Coal, Nuclear and Renewables Analysis. Project developers are lining up for subsidies approved in the 2009 stimulus bill as incentives expire and the deficit-reduction deal dims prospects for future backing of solar panels and wind farms.

“The debt agreement, which is focused on cuts only and not revenue increases, makes it more likely that this infant sector gets strangled before it matures,” Daniel J. Weiss, a senior fellow at the Center for American Progress, a Washington policy group that advises Democrats, said in an interview with Bloomberg Government.

The deal on a debt-limit increase that Congress and President Barack Obama struck to avert a U.S. default would result in at least $2.1 trillion in spending cuts, according to the Congressional Budget Office. Additional savings of at least $1.2 trillion would come from enactment of a deficit-reduction bill or from automatic spending cuts if Congress fails to accept a package framed by a 12-member panel.

Direct Pressure
“The potential lapse of key subsidies at the end of 2011 puts the pressure all the more directly on the clean-energy sector to drive down costs and become more competitive between now and then,” according to a Dec. 13 report by Bloomberg New Energy Finance.

The Treasury Department has paid out $7.78 billion in grants to developers of wind, solar, biomass and geothermal energy under an incentive that was created in the stimulus bill and lapses at the end of the year. Tax credits for wind, solar and geothermal projects end in 2012 and 2016.

“I will be working hard to preserve renewable energy incentives, but it will be more difficult to do so going forward, and that is one reason I opposed the deficit deal,” Senator Robert Menendez, a New Jersey Democrat, said in an e- mail. “Oil company incentives do not sunset, but renewable incentives do.”

Government aid for renewable energy is up from $5.12 billion in 2007, according to the EIA. Subsidies are expected to decline beginning this year, and will fall 77 percent by 2016 from the record in 2010, according to the White House Office of Management and Budget.

Tax Credits
The expiring grants from the Treasury filled a void in project financing that followed the collapse of Lehman Brothers Holdings Inc. three years ago. The grants were offered after the recession sapped demand in the tax equity market, where tax credits earned by solar and wind project developers could be sold to companies seeking to reduce their tax burden.

The tax credits also will expire unless Congress approves an extension. The production tax credit, used mainly by wind- farm developers, runs out at the end of 2012. The investment tax credit, which goes primarily to solar and geothermal projects, ends in 2016.

“The truth is that paying equity subsidies for green energy is expensive,” Kevin Book, managing director at ClearView Energy Partners LLC, a Washington-based policy analysis firm, said in an interview. “Who will be the strong voice to defend credits, and which credits get defended?”

Other subsidies for energy, which go both to renewable sources and oil and gas, may also be targeted by the congressional debt-reduction panel.

Tax Code

Written into the federal tax code are benefits valued at $24.2 billion for renewable energy and efficiency incentives through 2014, compared with an estimated $17.9 billion for the oil, gas, and coal industries, according to a December report by the congressional Joint Committee on Taxation.

“We’ve only just started supporting renewable energy,” Ellen Vancko, manager of the Nuclear Energy and Climate Change Project at the Cambridge, Massachusetts-based Union of Concerned Scientists, said in an interview. “We need to allow these technologies to mature so they don’t need subsidies.”

Globally, government spending on renewable energy peaked last year at $74.5 billion and will decline to $68 billion this year before dropping to $21.4 billion in 2013, according to New Energy Finance.

In the U.S., the 2009 stimulus bill provided $65 billion for clean energy, including loan guarantees for solar and wind power, funding for state programs to help make homes more energy efficient, research into battery-powered cars and trucks and systems to capture carbon dioxide from power-plant emissions. The bill also created the Treasury grant program.

Spent by Mid-2012
By the end of last year, the U.S. had spent 36 percent of the $65 billion, according to Stephen Munro, an analyst with New Energy Finance in Washington. By mid-2012, all the money should be spent.

About $34 billion in stimulus funds will be spent on clean energy this year, up from $13 billion in 2010, Munro said. The remainder, about $18 billion, will be delivered by July 2012 as continued disbursements for Treasury grants and accelerated depreciation for renewable technologies, he said.

Projects that begin construction this year can qualify for a Treasury grant. Payments under the program, made when the renewable power source goes into service, are expected to reach a high of $4.26 billion this year and end in 2016 with $620 million in outlays, according to the White House Office of Management and Budget.

The grant program was extended through this year in a December 2010 tax deal.

‘Political Football’
“The Treasury grants are very vulnerable in the current fiscal mood and the production tax credit has always been a political football,” said Nathanael Greene, director of renewable energy policy at the Natural Resources Defense Council in New York. “Wind energy has the most at stake right now. Expiry of the credits would put a lot of people on the street.”

The stimulus bill also included $6 billion for Department of Energy loan guarantees to back renewable projects, a figure later reduced to $2.5 billion. The department said in May it stopped work on a loan guarantee for Cape Wind off of Massachusetts because there wasn’t enough money for all applicants. The first U.S. offshore wind farm is projected to cost $2.6 billion. Funding for the loan guarantee program fell to $170 million in the current budget.

About 75,000 jobs in the U.S. are in the wind-power industry, according to Denise Bode, chief executive officer of the American Wind Energy Association, a trade group in Washington.

Current wind “projects are safe, and prospects for extension of the program beyond 2012 are as good as ever,” Bode said in an e-mail. “I had a front-row seat to tax reform in the mid-1980s, and I feel confident that wind incentives will survive this process.”

To contact the reporters on this story: Jim Efstathiou Jr. in New York at; Christopher Martin in New York at

To contact the editor responsible for this story: Larry Liebert at



Federal Reserve Says U.S. Bank Capital Won’t Be Affected by S&P’s Action

“S&Pの米国債格付け(AA+)はFRBのポリシーに影響しないと。貸し出し金利の上昇はないと”である。どうも、そう思っていたよ。伊勢平次郎 ルイジアナ

By Jeannine Aversa - Aug 5, 2011 11:27 PM CT .

Standard & Poor’s decision to cut the U.S. credit rating won’t affect the capital positions of the nation’s banks, regulators said yesterday.

Banks, which hold Treasuries as a form of capital, won’t need to build larger cushions to protect against possible losses from soured loans, a group of banking regulators, including the Fed and the Federal Deposit Insurance Corp., said in a statement in Washington.

“For risk-based capital purposes, the risk weights for Treasury securities and other securities issued or guaranteed by the U.S. government, government agencies and government- sponsored enterprises will not change,” the regulators said.

One of the missions of the Fed is to ensure the safety and soundness of the U.S. banking system. During the 2008 financial crisis, the Fed required the biggest banks to undergo “stress tests” and ordered some of them, including Citigroup Inc. and Bank of America Corp., to enlarge their capital buffers.

Emergency Fed lending to banks and the central bank’s purchases and sales of government securities, carried out to influence borrowing costs in the economy, also won’t be affected, a central bank official said.

The Fed provides emergency loans secured by collateral through the so-called discount window when other sources of funding aren’t available.

Lending through the discount window surged to a high of $110 billion a day during the height of the financial crisis in the fall of 2008 following the collapse of Lehman Brothers Holdings Inc. At the time, banks turned to the Fed as a lender of last resort because their sources of credit were frozen. Fed lending through the discount window was down to $10 million for the week ending Aug. 3.

Interest Rates

The Fed official also said that S&P’s decision would have no implications on its ability to influence interest rates through open-market operations. The Fed in June completed a $600 billon Treasury bond-purchase program aimed at bolstering the economy.

Fed Chairman Ben S. Bernanke said last month that the central bank could buy more Treasury securities if the economy appeared in danger of stalling.

Bond purchases and other steps for the Fed to stimulate the economy are likely to be discussed at the Fed’s Aug. 9 meeting, said Lynn Reaser, chief economist at Point Loma Nazarene University in San Diego and a board member of the National Association for Business Economics.

“The credit downgrade will have little impact on the Fed’s deliberations,” she said. “They will be more driven by jobs and the recent weakening in the economy.”


Strategists Sticking With 17% S&P 500 Gain on Higher Profit

ビッグボーイたちは強気ですね。S&P500インデックスは、年末までに17%(それぞれ違うが平均で)上がると。ビッグボーイたちが、その根拠としているのは、「企業成績」だ。現在、株価は下げているが、75%の米企業の成績が良好なのだからと。PEに比べて、株価はあまりにも低いのだと。伊勢平次郎 ルイジアナ

By Whitney Kisling, Inyoung Hwang and Lynn Thomasson - Aug 5, 2011 3:29 PM CT .

“S&P 500 profit will rise 18 percent in 2011 and 14 percent in 2012, according to the average per-share analyst estimates in a Bloomberg survey”

Aug. 5 (Bloomberg) -- Mark Mobius, executive chairman of Templeton Asset Management’s emerging markets group, talks about the outlook for global stocks and his investment strategy. More than $4.4 trillion have been wiped out from equity market values worldwide amid a sell-off that drove the MSCI All-Country World Index down more than 10 percent from this year’s high into a so-called correction. Mobius speaks from Tokyo with John Dawson on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)

Aug. 4 (Bloomberg) -- Joseph McAlinden, chief investment officer at Catalpa Capital LLC, Dennis Hynes, chief market strategist at R.W. Pressprich, and Adam Seessel, director of research at Martin Capital Management, talk about today's selloff in the U.S. equity market and investment strategy in the current economic climate. They speak with Pimm Fox on Bloomberg Television's "Taking Stock." (Source: Bloomberg)

Aug. 5 (Bloomberg) -- Marc Faber, publisher of the Gloom, Boom & Doom report, talks about global financial markets. Faber also discusses Federal Reserve monetary policy. He speaks from Zurich with Susan Li and John Dawson on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)

Aug. 2 (Bloomberg) -- Bill Gross, who runs the world's biggest bond mutual fund at Pacific Investment Management Co., talks about the U.S. debt ceiling compromise passed by Congress and signed into law by President Obama, the outlook for U.S. tax policy and the state of the economy. Gross, speaking with Carol Massar on Bloomberg Television's "Street Smart," also discusses Federal Reserve policy and Pimco's investment strategy in the current climate. (Source: Bloomberg)

Aug. 5 (Bloomberg) -- Laszlo Birinyi, president and founder of research and money management firm Birinyi Associates Inc., talks about the performance of U.S. equities and investment strategy. Biriyni speaks on Bloomberg Television's "InBusiness with Margaret Brennan." (Source: Bloomberg)

Wall Street has never been more sure that the Standard & Poor’s 500 Index will rally in 2011, even after speculation the U.S. economy is heading for a recession prompted the biggest plunge since the bull market began. Photographer: Jin Lee/Bloomberg
Wall Street has never been more sure that the Standard & Poor’s 500 Index will rally in 2011, even after speculation the U.S. economy is heading for a recession prompted the biggest plunge since the bull market began.

Chief strategists at 13 banks from Barclays Plc (BARC) to UBS AG (UBSN) see the benchmark measure of American equity surging 17 percent through Dec. 31, the average estimate in a Bloomberg survey. Their projection that the index will reach 1,401 hasn’t budged in four weeks, while mounting concern U.S. growth is slowing drove the S&P 500 down 11 percent since July 22, including yesterday’s 4.8 percent tumble.

About $1.8 trillion has been erased from American equities as reports on manufacturing and consumer spending showed the world’s largest economy is slowing. Forecasters at UBS and Deutsche Bank AG (DBK) say rising profits mean the S&P 500 deserves a higher price-earnings ratio than the 28-month low reached yesterday. A year ago, strategists also remained bullish after a 14 percent drop, and proved prescient as the S&P 500 rallied 20 percent from its August low.

“I’m reluctant to overreact to some shorter-term weakness, no matter how real it is, because the market has proven to be unbelievably resilient,” Jonathan Golub, the chief U.S. market strategist at UBS in New York, said in an Aug. 3 phone interview. “If you would have been acting that way for the last two years, you would have gotten killed by this market. Companies have done an absurdly good job of managing through this environment.”

Most Since 2009

Golub says the S&P 500 will end the year at 1,425. It fell yesterday to an eight-month low of 1,200.07 amid a global rout, extending a nine-day retreat to 11 percent. That was the biggest loss over the same amount of time since March 9, 2009, when the gauge ended a 17-month bear market. The MSCI All-Country World Index slid 4.1 percent yesterday, the most since March 2009. The Stoxx Europe 600 Index fell to the lowest level since July 2010, while Brazil’s index sank the most since 2008, as commodities producers dropped.

The S&P 500 fell 0.1 percent to 1,199.38 at 4 p.m. in New York, bringing its weekly loss to 7.2 percent, the most since November 2008. Treasuries and the dollar fell today.

A year ago, stocks also fell as investors speculated the U.S. economy would contract. Equities plunged until Federal Reserve Chairman Ben S. Bernanke foreshadowed $600 billion in bond purchases meant to prevent deflation and stimulate growth at a Aug. 27, 2010, meeting in Jackson Hole, Wyoming.

Pimco’s Gross

Bill Gross, who runs the world’s biggest bond fund at Pacific Investment Management Co., told Bloomberg Television on Aug. 2 that another asset-purchase program may be announced by the Fed, even after President Barack Obama signed a deficit reduction plan that demands less government spending.

Should a plan materialize, it won’t have the same impact as last year, said Mark Luschini of Janney Montgomery Scott LLC, which manages about $54 billion.

“The macroeconomic issues are trumping the good earnings picture,” Luschini, the chief investment strategist at the Philadelphia-based firm, said in a phone interview on Aug. 3. For valuations to rise, “we’d have to have better economic conditions than we do at the moment, and that’s not evident,” he said.

Expecting Growth

Strategists say earnings growth will fuel gains. S&P 500 profit will rise 18 percent in 2011 and 14 percent in 2012, according to the average per-share analyst estimates in a Bloomberg survey. More than 75 percent of corporations in the index have exceeded earnings estimates for the second quarter, with total income topping projections by 5.2 percent.

Credit Suisse Group AG (CSGN) and HSBC Holdings Plc (HSBA) advised investors to buy equities today. Andrew Garthwaite, a London- based strategist at Credit Suisse, reiterated an “overweight” recommendation on stocks even as he cut his year-end forecast for the S&P 500 to 1,350.

“Our economists are not forecasting a recession and, indeed, are looking for U.S. growth to accelerate in the second half,” Garry Evans, global head of equity strategy at HSBC in Hong Kong, wrote in a note today. “Investors should look to raise equity risk gradually over the summer.”

Even as companies from Ford Motor Co. (F) to Boeing Co. beat forecasts, the S&P 500 has plunged as investors turned their attention to reports showing slower economic growth. Consumer spending fell 0.2 percent in June, personal incomes grew at the slowest pace since November and an index of American manufacturing sank to a two-year low.

Not ‘Well-Reasoned’

“It’s unlikely I will change my view because we had a bad week or get really excited because we had a good week,” Tobias Levkovich, Citigroup Inc. (C)’s chief U.S. equity strategist in New York, said in an Aug. 3 phone interview. “That’s not a well- reasoned market outlook,” said Levkovich, who forecasts the S&P 500 will end the year at 1,400. “That’s a reactive trader mindset, but that’s not what I’m supposed to be doing.”

The combination of falling prices and rising profits has driven the S&P 500’s price-earnings ratio down 17 percent since Feb. 18, data compiled by Bloomberg show. At 13.2 times profit, the valuation is 20 percent below the average since 1954.

Following the drop in valuations, “our view is growth picks up, and like last summer/fall as the data turn up, they will take the equity market up with it,” Binky Chadha, Deutsche Bank’s chief U.S. equity strategist in New York, said in an Aug. 2 e-mail. He said the index will reach 1,550, the highest projection in the Bloomberg survey.

Last Year’s Rebound

The S&P 500 bottomed in 2010 at 1,022.58 on July 2. Gross domestic product expanded at an annual rate of 2.5 percent and 2.3 percent in the third and fourth quarters. The stock index rallied 10 percent to 1,127.79 through Aug. 9, before slipping 7.1 percent to 1,047.22 by Aug. 26.

At the time, strategists said the index would rise to 1,234 through the end of 2010, according to the average estimate. Three days later, Bernanke said the central bank would “do all that it can” to sustain growth, foreshadowing the bond-purchase program revealed two months later. The August announcement helped catapult the S&P 500 to 1,257.64 as of Dec. 31 and 1,343.01 by Feb. 18, a 28 percent advance.

Laszlo Birinyi, one of the first investors to recommend buying stocks when the bull market began in March 2009, said this week that stocks shouldn’t be abandoned.

More Scotch

“It’s like all these times when you second-guess yourself, and you probably wake up a little earlier than you’re used to, and maybe you put an extra finger of scotch in the glass,” Birinyi said in an Aug. 2 telephone interview. “It’s probably a good idea to have a gut check once in a while, because it makes you review and rethink your process. Our view is that this is still a market of some duration.”

The S&P 500 had the second-best performance in 2011 among the world’s 10 biggest stock markets through yesterday, even after the 12 percent slump since April 29 brought the year-to- date decline to 4.6 percent. China’s Shanghai Stock Exchange Composite Index did best with a 4.4 percent drop. Japan’s Topix lost 8.1 percent, while the FTSE 100 Index (UKX) of U.K. stocks dropped 8.6 percent.

“Doing this 22 years, to me this has to be the type of bottoming that the U.S. needed to just clean the slate,” Brian Belski, the New York-based chief investment strategist at Oppenheimer & Co., said in a telephone interview yesterday. “A year ago, we were only a couple quarters into the rebound, now we’re further in. There was less belief a year ago because nobody really believed forward earnings growth. Now they’ve proven themselves.” He estimates the S&P 500 will reach 1,325.

No Contraction

Barry Knapp, the New York-based chief U.S. equity strategist at Barclays, said that it’s unlikely the economy will contract even though data show a slowdown. The Citigroup Economic Surprise Index has averaged negative 95.05 since sinking on June 3 to negative 117.20, meaning reports were missing the median estimate in Bloomberg surveys by the most since January 2009.

“If you sell stocks at 1,250, that’s a bet we’re going back to a recession, and we don’t buy that,” Knapp said in a telephone interview yesterday. His year-end projection is 1,450. “The probability of the U.S. going back into a recession is low. These things have a way of running their course.”



Dollar Falls Before Payrolls, ‘Absurd’ Franc Weakens on Hildebrand Warning

By Emma Charlton and Candice Zachariahs - Aug 5, 2011 6:59 AM CT .

The Swiss franc has risen 4.9 percent since July 29 to 1.07760 per euro and earlier today touched a record 1.07112.

The Swiss franc has risen 4.9 percent since July 29 to 1.07760 per euro and earlier today touched a record 1.07112. Photographer: Adrian Moser/Bloomberg

Aug. 4 (Bloomberg) -- Bank of Japan Governor Masaaki Shirakawa speaks at a news conference in Tokyo about the state of the Japanese economy and the impact of the strong yen on businesses. The Bank of Japan added monetary stimulus after authorities intervened to stem an advance in the yen to protect the nation’s economic recovery. (Translated excerpts. Source: Bloomberg)

 Aug. 4 (Bloomberg) -- Kit Juckes, head of foreign-exchange strategy at Societe Generale SA, talks about the outlook for a resumption in bond purchases by the European Central Bank. He also discusses Japan's intervention to stem the appreciation of the yen with Maryam Nemazee on Bloomberg Television's "The Pulse." (Source: Bloomberg)

 Aug. 4 (Bloomberg) -- Thomas Harr, head of Asian foreign-exchange strategy at Standard Chartered Bank, discusses Japan's intervention today to weaken its currency. He speaks from Singapore with Linzie Janis on Bloomberg Television's "Countdown." (Source: Bloomberg)

 Aug. 4 (Bloomberg) -- Tohru Sasaki, the Tokyo-based head of Japan rates and foreign-exchange research at JPMorgan Chase & Co., talks about the yen. The currency weakened against all its major peers after Japan intervened in the foreign-exchange market for the first time since March to stem gains in the yen that threaten the nation’s economic recovery. Sasaki speaks with Rishaad Salamat on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)

 Aug. 4 (Bloomberg) -- Masafumi Yamamoto, chief currency strategist at Barclays Bank Plc in Tokyo, talks about the yen. The currency weakened against all its major peers after Japan intervened in the foreign-exchange market for the first time since March to stem gains in the yen that threaten the nation’s economic recovery. Yamamoto also discusses the U.S. economy and Federal Reserve monetary policy. He speaks with Rishaad Salamat on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)
Audio Download: Laidi Says the Weakest the Yen Will Get Is 82.50, Aug. 4 .The dollar fell, trimming weekly gains against the euro and yen, before data that’s forecast to support the case for low borrowing costs and show U.S. employers failed to create enough jobs to reduce the jobless rate.

Switzerland’s franc weakened from a record against the euro after the Swiss National Bank said it won’t exclude any measures to curb the currency’s advance. The yen strengthened against the dollar a day after Japan moved to weaken it, trimming the currency’s biggest weekly drop in four months, as tumbling stocks stoked demand for safer assets. U.S. payrolls probably climbed by 85,000 in July after an 18,000 increase in June that was the smallest this year, a Bloomberg survey showed.

“Today’s report should confirm that labor market conditions are very difficult, and that should cement expectations for further monetary easing from the Fed,” which would weaken the dollar, said Lee Hardman, a currency strategist at Bank of Tokyo-Mitsubishi UFJ Ltd. in London. “The very credible threat and strong signal from the SNB is holding the Swiss franc back.”

The dollar was 0.4 percent weaker against the euro at $1.4152 at 7:56 a.m. in New York, cutting its gain this week to 1.7 percent. It declined 0.5 percent to 78.54 yen, trimming its weekly gain to 2.3 percent, which is still the most since the week beginning April 1.

Sinking Stocks
The franc weakened 0.8 percent to 1.08505 per euro, dropping from a record 1.07112 reached earlier. It declined 0.4 percent against the dollar to 76.69 centimes.

The Stoxx Europe 600 Index sank 1.3 percent and the MSCI Asia Pacific index of stocks dropped 3.7 percent. Standard & Poor’s 500 futures were little changed after the U.S. benchmark plunged almost 5 percent yesterday.

The U.S. jobless rate is predicted to stay at 9.2 percent after rising in each of the previous three months, according to a Bloomberg survey of 84 economists before today’s report.

Concern the economic recovery will be cut short led U.S. equities to their biggest slump since February 2009 yesterday. Slowing growth puts more pressure on Federal Reserve policy makers meeting next week to try to steer the world’s largest economy away from another recession at a time when inflation is also accelerating.

“The big risk to the dollar is that the Fed will present a more dovish stance next week,” Hardman said.

Currency Volatility
Implied volatility among currencies of the Group of Seven nations jumped to 12.73 percent, the highest level since March, according to the JPMorgan Chase & Co. Volatility Index.

The Swiss Central Bank won’t exclude any “effective measures” to curb the advance of the franc, Hildebrand told Neue Zuercher Zeitung in an interview.

“At some point, an overvaluation becomes absurd, and that is already the case for the Swiss franc today,” Hildebrand was quoted as saying. “We clearly communicated that we are willing to take further measures if those are necessary.”

The franc is being pushed lower by “fear of the Swiss National Bank intervening,” said Neil Jones, the head of European hedge-fund sales at Mizuho Corporate Bank Ltd. in London. “There’s a real nervousness about that.”

The Swiss franc fell against 15 of 16 major peers tracked by Bloomberg, losing most against Norway’s krone and the euro. It’s still stronger against all 16 currencies this year.

German Data
“If it’s the case that the risk-off trade is not quite what it was, the franc will get weaker,” Mizuho’s Jones said.

The euro has slumped 3.6 percent over the past three months, the second-worst performer after the Swedish krona among the 10 currencies tracked by Bloomberg Correlation-Weighted Indexes, amid concern that the debt crisis may slow growth and dim prospects for higher interest rates in the region.

Industrial production in Germany unexpectedly decreased in June, led by declining construction output and a drop in investment goods such as machinery. Production declined 1.1 percent from May, when it rose a revised 0.9 percent, the Economy Ministry in Berlin said today.

Japan’s yen headed for five-day declines against the franc, dollar, British pound and euro.

Yesterday was the third time Japan sold its currency to support exporters after six years of a hands-off approach that ended in September 2010. Finance Minister Yoshihiko Noda said the action was unilateral. It probably spent 4 trillion yen ($51 billion) in the operation, the Nikkei newspaper reported, without saying where it obtained the information.

The Bank of Japan sold 692.5 billion yen on March 18, when it led a coordinated effort with the G-7 to counter a jump in the yen after the March 11 earthquake and tsunami. Last September, Japan unilaterally sold 2.12 trillion yen.

“The risk-off impetus that the yen typically is subject to is playing a part,” said Sacha Tihanyi, a Hong Kong-based senior currency strategist at Scotia Capital, the investment banking unit of Bank of Nova Scotia. “Though the BOJ’s bid on the dollar-yen is going to be a threat, there is also going to be solid buying pressure on the yen.”

To contact the reporters on this story: Emma Charlton in London at; Candice Zachariahs in Sydney at



Mobius Says Stocks Look Better, Faber Sees S&P 500 Rally

By Weiyi Lim - Aug 4, 2011 10:52 PM CT .

Aug. 5 (Bloomberg) -- Mark Mobius, executive chairman of Templeton Asset Management’s emerging markets group, talks about the outlook for global stocks and his investment strategy. More than $4.4 trillion have been wiped out from equity market values worldwide amid a sell-off that drove the MSCI All-Country World Index down more than 10 percent from this year’s high into a so-called correction. Mobius speaks from Tokyo with John Dawson on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)

Aug. 5 (Bloomberg) -- Marc Faber, publisher of the Gloom, Boom & Doom report, talks about global financial markets. Faber also discusses Federal Reserve monetary policy. He speaks from Zurich with Susan Li and John Dawson on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)

Aug. 5 (Bloomberg) -- Geoff Lewis, Hong Kong-based head of investment services at JP Morgan Asset Management, talks about global financial markets and his investment strategy. Lewis also discusses the outlook for Federal Reserve monetary policy. He speaks with John Dawson on Bloomberg Television's "On the Move Asia." (Source: Bloomberg)
Templeton Asset Management’s Mark Mobius said stocks are “looking better” amid turmoil roiling global markets. Marc Faber, publisher of the Gloom, Boom & Doom report, expects a rally in the U.S. Standard & Poor’s 500 Index of about 40-to-50 points.

The S&P 500 Index (SPX) slumped 60.27 points, or 4.8 percent yesterday, the biggest percentage drop since February 2009, as concern the global economy is weakening prompted a global rout. The MSCI World (MXWO) Index of global stocks entered a so-called correction yesterday, falling more than 10 percent from this year’s high, amid a seven-day sell-off that wiped out more than $4.4 trillion from market values worldwide.

“With real interest rates in negative territory around the world in most cases, we are much better off with equities,” Mobius, executive chairman of Templeton Asset Management’s emerging markets group, said in a Bloomberg Television interview today.

Asian stocks fell today by the most since March, while oil and wheat paced losses among commodities. The MSCI Asia Pacific Index sank 3.8 percent, the biggest drop since March 15, as of 11:50 a.m. in Hong Kong. The MSCI Emerging Markets Index dropped 2.8 percent, set for its biggest four-day decline since November 2008.

Markets are “extremely oversold,” Faber said in a separate Bloomberg Television interview, adding he expects a “snap-back” rally in the S&P 500. He doesn’t expect new highs for equities in 2011.

No Change

Chief strategists at 13 banks from Barclays Plc to UBS AG see the S&P 500 surging 17 percent through Dec. 31, the average estimate in a Bloomberg survey. Their projection that the index will reach 1,401 hasn’t budged in four weeks, while mounting concern U.S. growth is slowing drove the S&P 500 down 11 percent since July 22, including yesterday’s tumble.

The U.S. gauge closed yesterday at 1,200.07, the lowest level since Nov. 30. Futures on the gauge dropped 0.1 percent to 1,197.30 today. About $1.8 trillion has been erased from American equities as reports on manufacturing and consumer spending showed the world’s largest economy is slowing.

Thailand, Vietnam and Indonesia are of “particular interest” to Templeton, Mobius said. Thailand, where Yingluck Shinawatra is expected to become the nation’s first female prime minister after an election victory last month, is “right at the top of our list,” Mobius said.

Thailand’s SET Index gained 3.1 percent in the month to yesterday, the second-best performance among Asian benchmark gauges in that time, according to data compiled by Bloomberg.

“The emerging markets are in much better shape than the developed countries,” Mobius said. “If you look at the gross domestic product levels, foreign exchange reserves, emerging markets are in a very, very sweet spot.”

To contact the reporter on this story: Weiyi Lim in Singapore at


U.S. Stock-Index Futures Decline; S&P 500 May Fall for Eighth Day in Nine

By Cecile Vannucci - Aug 4, 2011 6:00 AM CT .

U.S. stock-index futures declined, indicating the Standard & Poor’s 500 Index will fall for the eighth time in nine days, before a report on initial jobless claims that may add to concern about the economic recovery.

Chevron Corp. (CVX) declined 0.5 percent in German trading as oil traded near a five-week low on concern the economic recovery is faltering in the U.S. Boeing Co. (BA) and DuPont Co., two stocks dependent on economic growth, fell more than 0.7 percent. Kraft Foods Inc. gained 3.1 percent after saying it will spin off its North American grocery business.

Futures on the S&P 500 expiring in September dropped 0.8 percent to 1,244.90 at 6:54 a.m. in New York. Dow Jones Industrial Average futures lost 74 points, or 0.6 percent, to 11,744.

“Everybody is nervous about the outlook,” said Jane Coffey, head of equities at Royal London Asset Management, which manages about $51 billion. “Politicians aren’t getting their act together particularly convincingly. There certainly seems to be very little risk appetite amongst investors.”

U.S. equities rose yesterday, preventing the longest slump in the Dow average since 1978, amid speculation the Federal Reserve will start another stimulus program to prevent a recession. The Dow had fallen for eight consecutive days as growing concern that the U.S. economy is faltering erased $1.07 trillion from American equities, according to Bloomberg data.

Initial applications for unemployment benefits increased to 405,000 last week, Labor Department figures may show today in Washington, according to the average estimate from a Bloomberg News survey of economists. The report last week showed jobless claims fell by 24,000 to 398,000, the lowest level since April.

The government’s monthly payrolls report tomorrow may show employers added 85,000 jobs in July, according to forecasts compiled by Bloomberg.

Chevron, the second-largest U.S. oil company, dropped 0.5 percent to $102.29, as crude oil for September delivery lost 20 cents to $91.73 a barrel in electronic trading on the New York Mercantile Exchange at 9:56 a.m. London time.

Airplane maker Boeing declined 0.9 percent to $66.76 in German trading, while DuPont fell 0.8 percent to $50.10.

Kraft Foods Inc. (KFT), climbed 3.1 percent to $35.35 after it reported second-quarter adjusted profit that beat analysts’ estimates and said it will spin off its North American grocery business to shareholders, splitting the existing company in two.

To contact the reporter on this story: Cecile Vannucci in Amsterdam at



Ex-Fed Officials Back More Stimulus


In the wake of a deal to raise the U.S. debt ceiling, three former top officials from the Federal Reserve - Donald Kohn, Vincent Reinhart and Brian Madigan - tell WSJ's Jon Hilsenrath how the central bank can handle a weakening economy.
.The Federal Reserve should consider a new round of securities purchases to spur the economy if growth and employment keep languishing and inflation recedes, former top Fed officials said in a roundtable with The Wall Street Journal.

The comments by Donald Kohn, Vincent Reinhart and Brian Madigan—who served successively as directors of the Fed's powerful monetary affairs division from 1987 through 2008—shine light on the challenging decisions Fed officials confront as they prepare for their next policy meeting Aug. 9.

The second round of the Federal Reserve's securities purchase program - known as QE2 - was criticized in some quarters but former fed officals, including Brian Madigan, tell WSJ's Jon Hilsenrath more might be useful.
.The economy has slowed sharply this year. But because inflation by many measures is above the Fed's 2% objective, Fed officials are reluctant to do more to boost growth. They aren't expected to take major new steps at their coming meeting, but the debate about what to do next is intensifying in and outside the Fed.

Mr. Kohn, who rose to become Fed Board vice chairman before retiring from the central bank in September 2010, said its options to support the economy are "kind of limited." But if inflation comes down and the economy doesn't pick up, he said he would give "very serious consideration" to a new round of bond purchases. He added that the Fed needs to "wait a little while" to see how the recovery plays out before making dramatic policy changes.

Three former top officials at the U.S. Federal Reserve, including Donald Kohn, tell WSJ's Jon Hilsenrath that the chances of a double-dip recession have risen to between 20 and 40 percent.
.The three former officials all cautioned that a new purchase program wouldn't represent a cure-all, "but in those circumstances, I think it's up to the central bank to do what it can to help around the edges," said Mr. Kohn, now a scholar at the Brookings Institution, a liberal-leaning Washington think tank.

The Fed completed a controversial $600 billion Treasury bond-buying program in June.

The central bank believes it helped to support the economy by holding down long-term interest rates and diminished the threat of a Japan-style bout of deflation—a fall in the overall consumer price level.

Journal Community
..But critics, including Republicans and foreign finance officials, say the program pushed down the dollar, pushed up prices for oil and other commodities, and thus made U.S. households worse off.

Mr. Madigan, who retired from the Fed a year ago and now advises Barclays Capital and teaches at Georgetown University, said the Fed's bond purchases had a "relatively modest" positive effect on the economy. Additional "purchases of that order of magnitude could be helpful at the margin," he said in his first public interview since leaving the Fed.

Mr. Kohn said he still believes the economic slowdown in the first half of the year was mainly due to temporary factors such as high food and gasoline prices and the disruptions caused by Japan's earthquake to the global supply chain. But he has become more worried about the economic outlook, putting the odds of a new recession at 20%.

The Fed's monetary affairs division plays a key role in preparing Fed officials for policy meetings and devising policy options for them to consider. The division head typically works very closely with the Fed chairman.

The debt limit deal leaves in its trail uncertainty about fiscal policy and how it will affect the economy and the U.S. Federal Reserve, three former fed officials, including Vincent Reinhart, tell WSJ's Jon Hilsenrath.
.Fears that a new recession might be around the corner have hit global financial markets in recent days. U.S. blue-chip stocks reversed a steep morning drop to snap an eight-day losing streak Wednesday. The Dow Jones Industrial Average squeezed out a gain of 29.82 points, or 0.25%, to finish at 11896.44

Fed Chairman Ben Bernanke signaled to Congress last month that the central bank could take new steps to support the economy if growth remains weak and inflation ebbs.

In one sign that inflation could slow, demand for inflation protection in U.S. government bond markets retreated Wednesday, said Michael Pond, a bond strategist with Barclays Capital.

Activity in the market for Treasury Inflation Protected Securities, or TIPS, suggested investors expect 2.72% inflation in five years, down from 2.90% last week. Last year it was below 2%.

The Fed will probably keep its key federal-funds rate, the banks' overnight lending rate, near zero until the middle of 2012 or beyond, said Mr. Madigan and Mr. Reinhart, who is now a scholar at the conservative American Enterprise Institute, a Washington think tank. The Fed lowered the rate at the end of 2008 to fight the financial crisis, leaving it with less ammunition to lift the economy. "We're flying the plane slower and closer to the ground, so we're less resilient to adverse shocks," said Mr. Reinhart, who puts the odds of a new recession at 40%.

Write to Jon Hilsenrath at and Luca Di Leo at



Oil Climbs as Stimulus Speculation Counters Economy, Gain in U.S. Supplies

前連邦準備委員会の3理事が、“セントラルバンク(FRB)は、国債買取のニューラウンドを考えるべきだ”と発言したことで、一時200ドルも下げていたダウは元気を取り戻した。30ドル黒字で終えた。原油とエネルギー株が特に上げた。伊勢平次郎 ルイジアナ

QBy Ben Sharples - Aug 3,2011

Oil rose from a five-week low in New York as speculation that the Federal Reserve may start another stimulus program countered signs of a slowing economy in the world’s biggest crude-consuming nation.

Futures climbed as much as 0.7 percent for the first gain in five days. U.S. equities rebounded after the Wall Street Journal reported three former top officials at the Fed said the central bank should consider a new round of securities purchases to bolster economic growth. Oil slid yesterday after reports showed U.S. service industries expanded in July at the slowest pace in 17 months and crude stockpiles climbed a second week.

Crude for September delivery gained as much as 62 cents to $92.55 a barrel in electronic trading on the New York Mercantile Exchange and was at $92.42 at 10 a.m. Sydney time. The contract yesterday dropped $1.86 to $91.93, the lowest since June 27. Prices are 12 percent higher the past year.

Brent oil for September rose 27 cents, or 0.2 percent, to $113.50 a barrel on the London-based ICE Futures Europe exchange. The contract yesterday declined $3.23, or 2.8 percent, to $113.23 a barrel. The European benchmark contract settled at a $21.30 premium to U.S. futures, compared with a record close of $22.67 on Aug. 2.

U.S. crude inventories last week rose 950,000 barrels to 354.9 million, an Energy Department report showed. Gasoline stockpiles climbed 1.7 million barrels to 215.2 million, the highest level since April 1. They were forecast to increase 250,000 barrels, according to a Bloomberg News survey.

The Institute for Supply Management’s index of non- manufacturing businesses, which covers about 90 percent of the economy, dropped to 52.7 from 53.3 in June. Economists projected 53.5 for July, according to the median forecast in a Bloomberg News survey. Readings above 50 signal expansion.

To contact the reporter on this story: Ben Sharples in Melbourne at



Dollar Rises Against Yen, Franc as Lawmakers Move Closer to Debt Agreement

By Candice Zachariahs and Robert Burgess - Jul 31, 2011 3:22 PM CT .

The dollar rose against the yen and Swiss franc on optimism U.S. lawmakers will reach an agreement on raising the debt ceiling one day before the Treasury Department said it will run out of cash to pay its bills.

The Australian and New Zealand dollars climbed versus the yen as prospects for a debt deal boosted demand for higher- yielding assets. IntercontinentalExchange Inc.’s Dollar Index, which measures the currency against six of the U.S.’s trading partners, fell in each of the past three weeks as the debt debate and concern that the world’s largest economy is losing momentum damped demand for the greenback.

“If we get some kind of agreement we can see a relief rally in the U.S. dollar,” said Khoon Goh, head of market economics and strategy at ANZ National Bank Ltd. in Wellington. “Any relief rally will probably be short-lived because it’s quite clear that the U.S. economy has lost momentum and further government fiscal restraint will drag on the economy.”

The dollar rose to 77.27 yen as of 5:20 a.m. in Tokyo from 76.76 yen on July 29 in New York, a record-low for a closing level. It bought 79.11 Swiss centimes from 78.55 last week, when it touched an all-time low 78.51. The greenback was little changed at $1.4391 to the euro from $1.4398. The euro rose to 111.20 yen from 110.54.

Congressional leaders said they were moving toward a deal amid a flurry of weekend negotiations, while a Republican senator warned not to expect a vote July 31 and a White House spokesman said critical issues still are not settled.

Senate Republican leader Mitch McConnell said congressional negotiators and President Barack Obama are “very close” to a deal to raise the debt limit, having made “dramatic progress” on a compromise.

Weakening Sentiment
“Markets will be relieved if a default can be avoided,” said Lena Komileva, the head of global head of Group of 10 strategy at Brown Brothers Harriman & Co. in London. “A successful vote will probably halt a major selloff and provoke a relief rally.”

Traders boosted bearish bets against the dollar last week to the highest level in more than two months on concern the political stalemate in Washington will erode the value of the world’s reserve currency.

Dollar Bears
Aggregate wagers against on a decline in the greenback rose for the fourth straight week, data from the Commodity Futures Trading Commission in Washington show. Futures traders added to bets the dollar will weaken against the euro, yen, Australian and Canadian dollars, British pound and Mexican peso. Wagers on a drop versus the franc were trimmed after the Swiss currency’s climb to a record last week.

Investor sentiment on the dollar weakened through July as lawmakers clashed over spending cuts and taxes when negotiating an increase of the $14.3 trillion debt ceiling before the U.S. exhausts its borrowing capacity tomorrow. The franc rallied to records against the dollar and the euro as the U.S. budget impasse, slowing growth and Europe’s sovereign-debt turmoil spurred demand for a refuge.

U.S. gross domestic product expanded at a 1.3 percent annual rate in the second quarter, after a 0.4 percent pace in the prior period, the worst six months since the recovery began in June 2009, Commerce Department figures showed July 29.

President Obama and congressional Republicans have sketched out the contours of an agreement that would raise borrowing authority through the next presidential election, according to people familiar with the talks.

The tentative framework includes immediate spending cuts of $1 trillion and creation of a special committee to recommend additional savings of up to $1.8 trillion later this year.

Spending Cuts
Republicans and the White House are weighing an accord that would prompt automatic spending cuts to all areas of government -- including defense and Medicare -- should a debt-cutting law fail to be enacted by Christmas. Senator Chuck Schumer of New York, the third-ranking Democrat, said such an approach “might work,” yet Democrats were still “fighting for revenues” -- or tax increases -- to kick in along with spending cuts if the debt savings aren’t achieved.

S&P indicated last week that anything less than $4 trillion in cuts may jeopardize the U.S.’s AAA rating. Moody’s reiterated on July 29 that the U.S. should be able to keep its Aaa rating as long as the Treasury agrees to raise the debt ceiling.

“What’s on the table now may prove woefully inadequate to prevent a downgrade,” said Komileva. “The more lasting concern is a reconsideration of U.S. assets as a haven. If this cliffhanger vote fails to show sufficient support for the plan, the markets will begin pricing in a financial catastrophe.”

Biggest Loser
The euro was the biggest loser among the most-traded currencies in July after Moody’s said it may cut Spain’s credit ranking and the nation’s prime minister called an early election, renewing concern Europe’s fiscal crisis is spreading.

The Swiss franc rose last month versus all of its most- traded counterparts, appreciating 7.8 percent to 1.1311 versus the euro, from 1.2188 on June 30. The franc gained for a sixth month against the dollar, appreciating 7 percent to 78.55 centimes in the longest winning streak since June 1994.

Japan’s currency advanced against the dollar last week after Jiji Press reported that Economy Minister Kaoru Yosano indicated intervention to weaken the yen was unlikely before the outcome of the U.S. deficit debate.

Group of Seven nations jointly sold the yen on March 18 after it surged to a record versus the dollar on the previous day, saying in a statement they wanted to reduce “excess volatility and disorderly movements.”

Volatility implied by one-month dollar-yen options increased last week to 11.15 percent, the highest level in more than two months.

To contact the reporters on this story: Candice Zachariahs in Sydney at; Robert Burgess in New York at




Author: Nobuyoshi Ozaki

A long forty six years have passed since I stepped on to American soil. I have had various odd jobs in the past until I recently retired. Examples include working with Steven Spielberg as assistant director in a film called "1941." I was supervisor and later became Public Relation representative for Toyota Group - USA. My last occupation was a Senior Research analyst working in Silicone Valley for a major news paper from Tokyo, Japan. My spouse, Christine is a flight attendant, traveling often to the Middle East and Africa. We have spent three quarters of our life together as world adventurers. This photo was taken in Argentina. We now live in swampy Louisiana.