America wasn’t founded so we could all be better. America was founded so we could all be anything we damned well pleased – P. J. O’Rourke
The markets were down pre-opening this morning, although they have recovered much of that. Oil was way down but that has also recovered much of the earlier losses. It’s still down considerably from where it was a few weeks ago. The Eurozone finance ministers withheld a payment to Greece that was supposed to help them stay afloat until Greece passes major spending cuts and major tax increases to show their willingness to help themselves. You may have noticed that the Greek people are not particularly happy with the thought of this.
Unfortunately, they have little choice in the matter. The rest of Europe is getting tired of their lack of effort to save themselves. It’s a weight not just on the rest of Europe but the rest of the world as well. It’s also not the only European country on the edge of disaster. It’s causing the global economy to feel pessimistic overall. Add to that the fact that China is trying to slow their economy down and it has caused an overall lowering of economic estimates.
Of course, then again this market action is not unusual for summers in general. The reasons given change from year-to-year, but the results are often strikingly similar. Forecasts of doom and gloom, followed by a significant pullback in the markets, followed by an oversold condition that leads to a buying spree when da boyz get back from the Hamptons at the end of summer.
FROM YAHOO FINANCE: THE 10 THINGS YOU NEED TO KNOW TODAY:
- Asian indices were mostly down in overnight trading with theBombay Stock Exchange falling 2.04%. Major European indices are in the red and U.S. futures indicate a negative open.
- Eurozone finance ministers have delayed €12 billion in loans to Greece without which the country will default on its sovereign debt in mid-July. The move is expected to pressure the Greek government to pass €28 billion in spending cuts and tax increases. Meanwhile Greek prime minister George Papandreou is set to face a confidence vote in Parliament tomorrow.Refresher: Here’s who gets slammed if Greece restructures >
- Moody’s threatened to downgrade Italy’s Aa2 credit rating in next 3 months, on concerns that the Greek crisis may push up interest rates in the eurozone and hurt Italy’s recovery.Don’t miss: The 21 countries most likely to default >
- Wages and salaries in the Eurozone were up 2.3% in Q1 2011 from a year ago, but the wage increase was lower than the 2.7% increase in consumer prices, which showed that real wages in the region continued to stay low.
- Moody’s has pushed Tepco’s credit rating to junk status. Tepco’s long-term issuer rating was cut to B1 from Baa3, and its senior secured rating was lowered to Ba2 from Baa2 on account of rising costs from the nuclear disaster at its Fukushima Daiichi plant. Now here are images of devastation in Japan a month after the earthquake >
- PNC Financial Services Group Inc has agreed to buy Royal Bank of Canada’s U.S. retail bank operations for $3.45 billion. The deal would add about 420 branches to PNC’s operations and help it expands its presence in the Southeast of the country. Check out the 16 strongest banks in the world >
- Brazilian airline TAM is buying engines worth $2.2 billion from Rolls Royce for Airbus A350s. Rolls Royce has also signed a 12-year agreement to provide the airline operator with its service support.
- Boeing has secured a $1.7 billion deal to provide Qatar with six 777 jets. Rival Airbus however is expected to announce a bigger $2.4 billion deal for 30 A320neo planes to Scandinavian airline SAS at the Paris Air Show today.
- Bankrupt bookstore chain Borders Group Inc. is expected to name its bidder on July 1st. Thebankruptcy court is expected to hold an auction on July 19 and a sale hearing by July 22. It has however reached a deal with GE Capital to keep 51 of its stores open.
- Goldman Sachs cut its Q2 GDP growth outlook to 2%, from 3%, on weak manufacturing over recent months and high unemployment. The news was a blow to the U.S. economy which was expected to be on its way to a recovery.
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I’ll let you know what I hear!!