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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Jim Willie CB who wrote (2676)	11/28/2003 7:31:10 AM
From: russwinter	Read Replies (2) \| Respond to of 110194

The world's central bank's are way behind the curve. Australia ready to follow up quickly on last month's rate increase: Australian Credit to Consumers, Business in October Rises 1.6% Nov. 28 (Bloomberg) -- Australian credit provided by banks and other financial institutions rose at its fastest annual pace in 14 years in October, suggesting the central bank may raise interest rates next week. Credit to consumers and business rose 1.6 percent in October from September and gained 14.7 percent from a year earlier, the largest annual increase since November 1989, the Reserve Bank of Australia said. Lending to consumers to buy houses surged 2.1 percent last month to be 23.1 percent higher than a year ago. The central bank has said it is concerned about consumers borrowing, which has been fueling housing construction and home prices. The bank this month increased its benchmark interest rate a quarter percentage point to 5 percent, the first increase in 17 months. ``It suggests that credit is clearly too cheap and justifies the central bank's November rate increase,'' Su-Lin Ong, senior economist at RBC Capital Markets, said in Sydney. ``It also provides further evidence for another 25 basis points tightening next Wednesday morning.'' The Reserve Bank's nine-member rate-setting board hold their December meeting on Tuesday. Nineteen of 22 economists surveyed by Bloomberg News forecast the central bank will increase its overnight cash rate target a quarter point to 5.25 percent. The decision is announced on Wednesday at 9:30 a.m. in Sydney. Finance for business increased 1.2 percent in October from September and rose 6.7 percent from a year earlier, the central bank figures showed. Lending to consumers for purposes other than to buy houses increased 1.1 percent for an annual gain of 12.9 percent. Last Updated: November 27, 2003 20:01 EST

To: Jim Willie CB who wrote (2676)	11/28/2003 2:28:38 PM
From: russwinter	Read Replies (4) \| Respond to of 110194

Surprise, surprise: Bank of Japan suffers first loss in decades By Charles Batchelor in London and Barney Jopson in Tokyo Published: November 28 2003 4:00 Japan's central bank made its first operating loss in 32 years in the six months to September 30 because lower bond prices reduced the value of its holdings in government securities. The Bank of Japan made an overall net loss of Y112.7bn (£600m) in the first half compared with a profit of Y288.5bn in the same period last year The bank said it would not be making a contribution to the government coffers this year. Last year it paid Y594bn - just over 1 per cent of government tax revenues. The move will be a blow to the government of Junichiro Koizumi, the prime minister, which is attempting to reduce bond sales and cut the national debt. The loss raises questions about the BoJ's policy of accumulating sizeable holdings of domestic government bonds and will hit the government budget. The bank reported a loss of Y793.8bn on the sale and redemption of domestic government securities and a loss of Y760bn from the devaluation of government securities. It also suffered losses on its large holdings of foreign government - predominantly US Treasury - bonds. The BoJ, which has been intervening heavily in the foreign exchange markets to stem the appreciation of the yen, has been the biggest foreign buyer of US Treasury and quasi-sovereign agency bonds. It has ploughed the bulk of the dollars gained through currency interventions into US government debt, whose performance has been weak and whose value has been eroded as the dollar has fallen.