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Chase Bank Limits Cash Withdrawals, Bans International... Before you read this report, remember to sign up to for 100% free stock alerts Chase Bank has moved to limit cash withdrawals while banning business customers from sending...

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Richemont chairman Johann Rupert to take 'grey gap... Billionaire 62-year-old to take 12 months off from Cartier and Montblanc luxury goods groupRichemont's chairman and founder Johann Rupert is to take a year off from September, leaving management of the...

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Cambodia: aftermath of fatal shoe factory collapse... Workers clear rubble following the collapse of a shoe factory in Kampong Speu, Cambodia, on Thursday

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Spate of recent shock departures by 50-something CEOs While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted upOn approaching his 60th birthday...

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UK Uncut loses legal challenge over Goldman Sachs tax... While judge agreed the deal was 'not a glorious episode in the history of the Revenue', he ruled it was not unlawfulCampaign group UK Uncut Legal Action has lost its high court challenge over the legality...

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Mini flash crashes: A dozen a day

Category : Business, Stocks

There’s been no major market disruption recently, but mini flash crashes in stocks like Apple, Berkshire Hathaway and Hanesbrands happen every day. ry day.

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VIDEO: Lagarde: ‘Women should not imitate men’

Category : Business

To mark International Women’s Day, former White House Press Secretary Dee Dee Myers asks IMF chief Christine Lagarde what would happen if women ruled the world.

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4 ways the market could really surprise you

Category : Business, Stocks

It’s impossible to time a stock market crash, but the chances that ‘something’ bad will happen should always be on investors’ minds. Here are four wild, yet plausible, blowup scenarios.

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4 ways the market could really surprise you

Category : Business, Stocks

It’s impossible to time a stock market crash, but the chances that ‘something’ bad will happen should always be on investors’ minds. Here are four wild, yet plausible, blowup scenarios.

Read more: 4 ways the market could really surprise you

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Military contractors wary as Defense Department prepares for fiscal cliff

Category : Business

Unhappy about implementing ‘sequestration’ Leon Panetta had largely avoided talking about the planned reductions in spending

Robert Lutts, the president of Cabot Money Management, held on to one defense related-stock in his portfolio for nine years: the shares of FLIR systems, a maker of infrared technology. He liked the company’s management, and its prospects. He will still happily bend your ear about the company’s bright future.

Still, he sold the last share of stock in 2011, shortly after Congress agreed that it would scale back the Pentagon budget by 10% in 2013.

“We’ve steered away from things related to government budgets, bottom line,” says Lutts.

At least Lutts had a plan. The Pentagon and the defense industry have been facing down the same looming budget cuts with an old, if questionably effective, method: denial.

The portion of the fiscal cliff that has to do with spending cuts dictates that the Department of Defense will lose $500bn from its budget on January 2, 2013 unless there is new legislation to stop it. The Pentagon maintains that it is already in the process of cutting its budget by $487 billion over 10 years.

Leon Panetta, the secretary of defense, said in a memo this week that the Pentagon was starting to plan for the spending cuts, or “sequestration,” as it is known in Washington patois. His tone was best described as grudging. “Sequestration was never intended to be implemented and there is no reason why both sides should not be able to come together and prevent this scenario,” Panetta wrote. He also indicated that the Department of Defense would delay the impact. “These cuts, while significant and harmful to our collective mission as an agency, would not necessarily require immediate reductions in spending,” Panetta wrote.”

Both the Department of Labor and the White House-run Office of Management and Budget have instructed defense contractors not to worry about potential hits to their budgets if the Pentagon – their biggest customer – sees its budget cut by 10% after the fiscal cliff.

Mackenzie Eaglen, a defense fellow at the conservative American Enterprise Institute, has observed the magical thinking in the defense community with some bemusement. With thousands of defense contracts at stake under Congressional control, neither the Labor Department nor the OMB – nor the Defense Department, for that matter – can change what Congress has already dictated.

“People are really only seeing what they want to see,” says Eaglen. “Most medium and large defense contractors have not started detailed planning on budget cuts, so they’re going to be caught flat-footed … the executive branch has been leading contractors on, lulling them into thinking [sequestration] won’t happen.”

The problem is partially a kind of superstition. Just as in the movie Beetlejuice – where saying the name of the demon could make it appear – the defense industry is worried that speaking about cuts will manifest them. They prefer to remain vague. “When you reveal in detail the lists and impacts of things that are going to occur, there are people outside or in Congress who then say: ‘this doesn’t look so bad, I could live with it’.”

Eaglen believes the Pentagon can slow the effect of budget cuts long enough that it will take up to six months for, say, a shipbuilding company or aerospace manufacturer to see its Pentagon-supply business dry up.

The biggest issue of the fiscal cliff is what the Pentagon will do with its employees, who may have to be furloughed. The Department of Defense employs 3.2 million people – 718,000 of them civilians – and is the largest employer in both the United States and the world.

By comparison, WalMart, the second-largest employer in the US, has 2.2 million on its payroll.

The Pentagon is not eager to think about laying off its people and will delay that as long as possible, said Michael O’Hanlon with the Brookings Institution. “When it comes to furloughs in the civilian work force, that could happen in the summer – in the hope that it never has to happen at all,” O’Hanlon said.

The foot-dragging in preparing for the sequestration cuts is evident in the stock prices of major defense contractors, like Raytheon and Boeing, whose shares have actually jumped in value in the past six months.

Rebecca Grant, the president of defense consulting company IRIS Research, said the defense industry is used to – if you’ll excuse the pun – cliffhangers. Years of budget battles have accustomed many companies in the industry to preparing for rainy days. “The defense companies have a group have done a good job of holding on to cash,” Grant said.

Boeing has about $11.17bn of cash and liquid investments on hand, which is equivalent to a whopping 20% of the entire company’s value in the stock market.

Similarly, Northrup Grumman has $3bn of cash on hand, which amounts to about 17% of the company’s market value.

The defense cuts are not the only gears that are starting to grind.

The US Treasury is close to its debt limit. Treasury defines the debt limit as the amount that the government is allowed to borrow to pay for services like Social Security, Medicare, military payroll and tax refunds, among other things.

Currently, the debt limit is set at $16.39tn; the Treasury has already borrowed $16.31tn and expects to slam against the debt limit in two weeks, at the end of December. That’s according to the most recent daily financial statement from the US Treasury.

If the Treasury overshoots the debt limit, the US will not be able to pay the bills it has already run up this year – including payments to Social Security and Medicare recipients as well as the unemployed, who will be waiting for their checks.

After that, the Treasury’s only option to keep the US solvent is to take what it calls “extraordinary measures.” That could include selling financial assets, US-owned gold, stakes in stimulus projects, or even the government’s portfolio of student loans – all of which the Treasury considers impracticable.

Instead, federal spending would have to be immediately cut to help the Treasury meet its obligations. That kind of last-minute set of cuts, on top of the cuts already planned for the fiscal cliff, could cause governmental chaos.

As for the chances that Congress could break for Christmas and then come up with a deal in two days before the New Year’s break, that also seems more and more unlikely to many as time passes. House speaker John Boehner trudged into a press conference Friday wearing a hangdog expression and slumping shoulders. He announced his party’s failure to reach an agreement to avoid the fiscal cliff.

When a reporter asked him how a final agreement would be possible, Boehner glumly replied, “How we get there? God only knows.”

Bailout fund gets a ‘yes’ vote but eurozone isn’t in the clear

Category : Business

Already the potential flaw in Mario Draghi’s carrot-and-stick approach is obvious – it is not clear what would happen if Spain requests financial help but then fails to deliver a reform package

That’s another hurdle cleared. The German constitutional court has delivered its verdict: it’s a “yes” to the legality of the European Stability Mechanism (ESM), albeit with the heavy rider that the Bundestag can veto any increase in Germany’s contribution to the rescue fund above €190bn (£152bn). Is it off to the races then? Is €500bn of potential lending from the ESM, plus Mario Draghi and European Central Bank piling in with unlimited bond purchases, now a safeguard of stability? Can we stop worrying about whether the single currency will be around in recognisable form in a half a decade or so?

No. Already the potential flaw in Draghi’s carrot-and-stick approach is obvious. It is not clear what would happen if Spain, say, requests financial help but then fails to deliver on the terms of the accompanying reform package demanded by the EU, the European commission and the International Monetary Fund.

Would Draghi turn off the bond-buying tap? That’s what he has implied would happen. But it very hard to believe that the central bank, having gone this far, would abandon Spain at a moment of crisis. The ECB would be giving up on the euro in its current form, and incurring some heavy losses of its freshly bought bonds.

Instead, it seems more likely that efforts would be made to downgrade the stick (the reform package) to a softer implement. But try selling that idea to sceptical German voters – or, indeed, to the Bundesbank, already fretting that the ECB has got itself into the business of funding member states.

Of course, this scenario is yet to occur and will not happen overnight. That is why almost everybody agrees that Draghi has succeeded in buying a considerable amount of time. The trouble is, the potential flaw looks highly likely to be tested sooner or later if Spain is indeed forced to take austerity measures. Youth unemployment is 50%, the banking system is on life support and the economy is in recession. Cutting the short-term cost of government funding would clearly help. But cheaper money alone does not create demand or stir recovery.

As Jamie Dannhauser at Lombard Street Research put it last week: “Linking monetary salvation to the prospect of even more severe fiscal self-flagellation and political discord may not work; even worse, it may backfire because it highlights the limits of what the ECB is prepared to do.”

Opinion: Apple needs more than a new iPhone

Category : Business, Stocks

Apple’s stock fell slightly last October when it unveiled the iPhone 4S. Will the same thing happen once the iPhone 5 is introduced?

Originally posted here: Opinion: Apple needs more than a new iPhone

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Who Built That? – Huffington Post

Category : Stocks

Who Built That?
Huffington Post
The Romney campaign got a nice treat July 13th in Virginia. No sense denying the red meat President Obama served up when these precise words came out of his mouth: “If you've got a business, you didn't build that. Somebody else made that happen.

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Bonds, Gold, Silver, S&P 500 and Oil Reaching Extreme Levels

Category : Stocks

NEW YORK ( — Pre-market analysis points: U.S. dollar index in consolidation and also forming a mini head-and-shoulders pattern that, if the neckline is broken, points to lower prices for the dollar that may last one or two sessions. Gold and silver are trading at resistance levels and are headline driven at this point. Anything could happen, so I remain on the side for now. Oil continues to show weakness but is trading within a major support level. I am keeping my eye on the intraday charts for a reversal pattern to play a bounce/rally this week. Bonds continue to rise with record low yields … this shows there is real panic and fear in the market, and lower prices may continue for another week or two. The volatility index, while elevated, is still overall trading low. This means more downside is possible as investors and baby boomers start to roll more of their money out of stocks and into bonds. S&P 500 sold down another 1% in futures trading after the closing bell — very bearish. This morning we have seen the dollar index pull back, and that has allowed the S&P 500 to recover the 1% post-market drop on Friday.

Those of you short the S&P 500 with me should tighten your stops in case there is a sharp rebound in the market. The position is up more than 9.5% in fewer than five days, and I want to lock in a good chunk of that with a stop at this morning’s high in the market or your low for your inverse fund, depending on what you are trading. Gold and silver are trading at resistance levels and are headline driven at this point, making it seem to investors that anything could happen.

After Friday’s weakness in stocks and commodities we continue to see that fear and selling pressure carry over into this week (see video here). European markets are trading lower by 1% to 2%, and I felt the U.S. market will naturally want to follow them down. The US market is down only 0.5%, so it is possible we see another 1% to 1.5% drop within the next 24 hours. …

Read more here: Bonds, Gold, Silver, S&P 500 and Oil Reaching Extreme Levels

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