Third
bailout for Greece realistic: Eurogroup head - (www.reuters.com) Greece's financial troubles will not end in
2014 and it is therefore realistic to expect the debt-laden country will need
additional money from the euro zone before
it can return to markets, the head of
euro zone finance ministers
said. International lenders estimate that Greece will
need around 10-11 billion euros ($13.1-14.4 billion) from the second half of
2014 to keep it going next year and in 2015. But several euro zone governments
are reluctant to extend any further loans because of negative public opinion,
with voters tired of bailing out other countries after three years of the
sovereign debt crisis. "As far as the potential need for a third program
for Greece is
concerned, it's clear that despite recent progress, Greece's troubles will not
have been completely resolved by 2014," Jeroen Dijsselbloem told the
European Parliament.
Student loan bubble starting to burst - (www.cnbc.com) The largest
bank in the United States will stop making student loans in a few weeks. JPMorgan Chase has sent a memorandum to colleges
notifying them that the bank will stop making new student loans in October,according to
Reuters. The official reason is quite bland. "We
just don't see this as a market that we can significantly grow," Thasunda
Duckett tells Reuters. Duckett is the chief executive for auto and student
loans at Chase, which means she's basically delivering the news that a large
part of her business is getting closed down. The move is eerily reminiscent of
the subprime shutdown that happened in 2007. Each time a bank shuttered its
subprime unit, the news was presented in much the same way that JPMorgan is
spinning the end of its student lending.
India
scrambling to reduce oil bill inflated by sinking rupee - (www.reuters.com) India's top oil official is grasping at
desperate measures to cut the country's oil costs by nearly $20 billion after
the rupee's slide to record lows has left India facing an oil bill potentially
50 percent higher than on May 1. Oil Minister M. Veerappa Moily has suggested
pricking the ballooning oil bill with everything from a street theatre campaign
encouraging lower fuel use, to shutting fuel stations, to increasing imports
from Iran. India's
crude import bill was $144 billion last fiscal year - the largest part of its
overall import costs. India, Asia's third-largest economy, imports
about 80 percent of its oil, which accounts for about 30 percent of its energy
needs. That has hit India hard over the last four months as the rupee fell 20
percent to record lows near 70 to the dollar. The economy is
struggling with decade-low growth, a record current account deficit and a steep
fiscal shortfall.
Falling
Economic Tide in India Is Exposing Its Chronic Troubles - (www.nytimes.com) India had seemed tantalizingly close to
embarking on the same dash for economic growth that has lifted hundreds of millions
of people out of poverty in China and across East Asia. Its economy now stands
in disarray, with the prospect of worse to come in the next few months. Vinod
Vanigota, a Mumbai wholesaler of imported computer hard drives, said sales
dropped by a quarter in the last two weeks. The rupee, India’s currency, has
been so volatile in recent days that he began revising his price lists every
half-hour. Business activity at Chip Com Traders, where he is the managing
director and co-owner, has slowed so sharply that trucking companies plead for
business. “One of the companies called today and said, ‘Don’t you have a parcel
of any sort for us to deliver today?’ ” Mr. Vanigota said. The economic
decline has laid bare chronic problems, little remarked upon during the recent
boom. An antiquated infrastructure, a sclerotic job market, exorbitant real
estate costs and bloated state-owned enterprises never allowed manufacturing,
especially manufacturing for export, to grow strong.
Currency
Trade Reaches $5.3 Trillion a Day as Yen Turnover Jumps - (www.bloomberg.com) Foreign-exchange trading surged to an average
$5.3 trillion a day in April 2013, boosted by greater yen volumes, the Bank for International Settlements said. Trading
increased 33 percent since the same period in 2010, the BIS said, citing a
survey of currency traders it runs every three years. That’s an acceleration
from a 20 percent increase in the three years through 2010. The yen had the
biggest jump in trading activity among major currencies, while the euro’s role
as the second-most traded currency was reduced. Emerging-market currencies
increased their share, with the Mexican peso entering the top 10 most-actively
traded currencies. Volumes in the global foreign-exchange market are increasing
as traders expand activities in developing nations and banks focus on the currency markets while stricter regulations after the
financial crisis threaten earnings from other divisions. Transactions jumped
this year as diverging economies stoked increasing swings in exchange rates.
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