Top Interest Rate Headlines 08-12-11: Federal Reserve Officials Clash On State Of Economy

Federal Reserve officials clash on state of economy
Reuters
Underscoring divisions at the central bank, one top policymaker on Friday said he had cut his forecast for economic growth, even as another said he saw no economic need for new monetary stimulus.
http://jlne.ws/rnQGCU

US retail sales rise in July, easing recession fears
BBC
US retail sales rose in July by the largest amount in four months, Commerce Department figures show, tempering fears that the US may be slipping back into recession.
http://jlne.ws/q01azN

Third Quarter 2011 Survey of Professional Forecasters - Philadelphia Fed
Federal Reserve Bank of Philadelphia
Growth in the U.S. economy is predicted to be slower in the short run compared to the forecast of three months ago, according to 37 panelists surveyed by the Federal Reserve Bank of Philadelphia. Our panelists expect real GDP to grow at an annual rate of 2.2 percent this quarter, down from the previous estimate of 3.4 percent. On an annual-average over annual-average basis, the forecasters have also revised downward their forecasts of real GDP growth. The forecasters see real GDP growing 1.7 percent in 2011, down from their prediction of 2.7 percent in the last survey. The forecasters predict real GDP will grow 2.6 percent in 2012, 2.9 percent in 2013, and 3.1 percent in 2014.
http://jlne.ws/mZsDmG

British Bankers' Association Statement On Personal Banking Customers Affected By Riots
BBA
The banks recognise the problems the recent riots have created for personal banking customers, especially where branches have been closed because of the disorder. The industry has implemented a series of solutions to offer assistance for those who have found themselves in difficult circumstances.
http://jlne.ws/qfNXxB

Consumers Are Miserable, but Still Shopping For Now
WSJ.com
Watch what they do, not what they say. Consumers in early August say their view of the U.S. economy is the worst since 1980 — a time covering the only back-to-back recessions in modern history. But consumers shopped at a solid pace in July and into early August.
jlne.ws/qb5IWH

Sometimes, Inflation Is Not Evil
By FLOYD NORRIS, NY Times
Thirty years ago, it became clear that defeating inflation was crucial, even if the means needed to accomplish that would cause a deep recession. By the time the European Central Bank was created in the 1990s, it seemed so obvious that inflation must be fought that the bank was given only one mandate — to fight inflation. The other mandate given to its United States counterpart, the Federal Reserve — to promote employment — was pointedly not included.
http://jlne.ws/q5PxEO

Cost of a European bank bailout worries investors
Economic Times
LONDON: Ever since Lehman Brothers collapsed nearly three years ago, Europe's leaders have repeatedly vowed to prevent any major European bank from failing. But as bank shares plummeted this week, the question on investors' minds was not whether governments would rescue their banks if necessary. It was how much a bailout might cost them.
http://jlne.ws/pVVE4E

How to make monkeys out of rating agencies
By Peter Tasker, Financial Times
Sovereign downgrade? Been there, done that ... such is likely to be the response of any investor in Japan to the news that Standard & Poor’s has removed its triple A rating on US debt.
http://jlne.ws/pOu3Ze

Greek Economy Shrinks by 6.9%
By STELIOS BOURAS And ALKMAN GRANITSAS - WSJGreece's gross domestic product contracted by an annual rate of 6.9% in the second quarter of the year, compared with a negative rate of 8.1% in the first three months of the year, the country's statistics service said Friday.
http://jlne.ws/pgxTCC

Citadel Chief Gives Up Dream for Investment Bank
By AZAM AHMED and SUSANNE CRAIG, NY Times
It was to have been the summit of a spectacularly ambitious and rapid ascent in finance: turning what began as a $4.6 million hedge fund into an investment bank that could rival Goldman Sachs.
http://jlne.ws/rpmRPU

Deutsche Bank, UBS Offer $1.4 Billion of CMBS as Spreads Widen
By Sarah Mulholland, Bloomberg
Deutsche Bank AG (DBK) and UBS AG (UBSN) are offering a $1.4 billion commercial-mortgage bond deal at the highest relative yields since sales of the debt revived in 2009 as Europe’s sovereign fiscal crisis roils markets.
http://jlne.ws/oL4u2Z

HSBC U.S. Win Sends Madoff ‘Hot Potato’ Back to Irish, Luxembourg Courts
By Stephanie Bodoni, Bloomberg
HSBC Holdings Plc (HSBA)’s U.S. court victory against Irving Picard, the trustee liquidating con man Bernard Madoff’s management firm, may be a boost for investors who filed lawsuits against HSBC and UBS AG in Europe. U.S. District Judge Jed Rakoff in New York on July 28 threw out Picard’s suit seeking almost $9 billion, ruling the trustee can’t bring common-law claims against the bank.
http://jlne.ws/qtkcXB

BofA faces struggle to sell CCB stake
By Henny Sender in Hong Kong and Simon Rabinovitch in Beijing, Financial Times
Bank of America is facing difficulties in selling its 10 per cent stake in China Construction Bank, partly because potential investors are expecting a deluge of rights issues, share sales and new listings from Chinese banks
http://jlne.ws/qrE0rz