Updates resume July 15

QUICK OVERVIEW

• The net worth of the median U.S. family — one with an equal number of families richer and poorer — fell to $77,300 in 2010 from $126,400 three years earlier (down 40%), after adjusting for inflation, the Federal Reserve said in a new report. (FT) Several US banks want to tap the value of ‘intangible’ assets such as intellectual property held by their borrowers as a way of meeting higher capital requirements.

• The FT reports the unnamed banks “seek deals in which an insurer agrees to buy a borrower’s intellectual property – anything from a mobile phone patent to a logo or recipe – for a fixed price in case of default.” The banks and insurers are haggling over the prices; banks believe they should be lower than that of CDS. However one deal is close to being submitted to the Fed for approval.

• US current account trade deficit grew to $137.3 billion in first quarter, largest since 2008.

• In April, overall foreign holdings of U.S. long-term securities reached 5.16 trillion U.S. dollars, up 21 billion dollars, or 0.4% MoM. It was the fourth consecutive monthly increase.

• Singapore's jobless rate edges up to 2.1% in Q1 The unemployment rate in the Philippines fell to 6.9 % in April

• The Japanese central bank kept key interest rate unchanged at zero to 0.1%

• The Annual inflation in the Eurozone dropped to 2.4% in May, down from 2.6% in the previous month

QUICK OVERVIEW

• With the close on 6/4/12 of Transports at 4847.43, and Industrials at 12101.46, IT’s opinion of Dow Theory is now bearish.

• AIG’s Robert Benmosche: The Europe debt crisis shows that governments worldwide must accept that people will have to work up to ages 70 or 80.

• (FT) Luxury market set to hit $1.5tn: The market for luxury, such as yachts, frocks and safaris, is set to hit $1.5tn this year, roughly matching the entire economic output of Spain or Australia, as the income inequality gap widens across the globe.

• The Commerce Department said that the U.S. trade deficit narrowed 4.9% in April to $50.1 billion.

• Goldman lowered US GDP forecast for 2012 to 1.8% from 2%.

• The EU issued a statement in support of Spain's request for financial assistance for its troubled banks. It added that it expects the loans to total about 100 billion euros ($125 billion).
• Geithner said that Spain's request for a bank rescue and Europe's willingness to prop up the country with as much as $125 billion in aid was welcome actions.
• German Finance Minister Schaeuble said that Spanish banks are not at all a danger for the stability of the euro and added that they will now be getting the capital they need.

• China's economic growth will likely moderate to around 8 % this year amid downward risks caused by the ongoing crisis in Europe, the IMF said.
• YoY China’s CPI slowed to 3.0 percent in May
• China's foreign trade rose 14.1% YoY to 343.58 billion U.S. dollars in May, rebounding from the 2.7% growth registered in April.
• China has cut interest rates by 25 basis points, its strongest move yet to prop up the economy as growth weakens. The benchmark one-year lending rate is now 6.31%, while the one-year deposit rate is 3.25%.

• YoY Japans current account surplus declined 21.2% in April
• Japans index of leading indicator dropped 1.3 points to 95.1

• French unemployment rate rose to 9.6% in Q1

• Australia's unemployment rate rose to 5.1 % in May

QUICK OVERVIEW

• U,S. nonfarm employment # rose just 69,000 in May, the least in a year. The Unemployment # rose to 8.2.
• U.S. pending home resale’s fell 5.5% following a revised 3.8% gain the prior month. YoY the index rose 14.7 %.
• U.S. economic growth slowed to an annualized rate of 1.9% in Q1 of the year. U.S. personal income rose 0.2% in April, after a 0. 4% in March
• U.S. personal consumption expenditures rose 0.3% in April, following a revised increase of 0.2% in March.
• The U.S. savings rate, or personal saving as a percentage of disposable personal income, edged down to 3.4 percent in April, slightly lower than 3.5 percent in March but still well above the 2.1-percent average rate for all of 2007 before the financial crisis.

• The Economist‏: In China, coffee consumption will grow by an average rate of almost 40% a year from 2011 to 2015.
• China's factory activity contracted for a seventh straight month in May, It fell to 48.4 from April's 49.3.
• China's house prices fell to a 16-month low in May.

• Japan and China will begin direct yen- yuan trading on June 1, Japanese Finance Minister Jun Azumi said Tuesday, abandoning the existing system that determines yen-yuan rates via their U.S.dollar values.

• Japan's industrial production rose 0.2 % in April.

• Capital flight from Spain hits record $66bn..
• The IMF is looking at possible plans for a rescue loan to Spain if that country can't find the cash to bail out its third-largest bank – No wait! The IMF says it has not been asked by Spain for a bailout and has not begun preparing one, IMF spokesman Gerry Rice. Spain yields at 6.576, and the 2-year Schatz now has a negative yield.
• Spain's 17 autonomous communities recorded balanced budgets in Q1 of this year New York

• Mayor Michael Bloomberg is set to propose a ban on the sale of some large-size soft drinks in many locations in the city as part of his drive to fight expanding waistlines in the Big Apple.

• The Chancellor should abandon his cast-iron debt reduction targets and inject up to £6bn into the economy to revive the flagging recovery, according to the the British Chambers of Commerce.

• The Philippine economy bounced back from a lackluster performance last year and grew by an unexpected 6.4 % in Q1 of this year.

• Mexico's economy will grow 3.72 percent in 2012, a slight increase from the 3.62 percent estimated in the previous month, results of a survey by the Mexican Central Bank.

• Italy's unemployment rate hit 10.2% in April, its highest level since January 2004.

• Southern Europe's debtor states must pledge their gold reserves and national treasure as collateral under a €2.3 trillion stabilization plan gaining momentum in Germany.