Friday, September 4, 2009

Announcements - Quick Notes & Articles for the Day - September 4

Daily Emails - The daily emails for this week's posts have been sporadic. I received Monday's on Thursday, Thursday's on Friday morning, and Tuesday and Wednesday as normal. I have been working on the issue with Google, so hopefully it will be worked out today or at the latest over the weekend. Sorry for any inconvenience.

Labor Day Holiday - Rollins & Associates and Rollins Financial will both be closed on Monday, September 7 for the Labor Day holiday. We will reopen on Tuesday, September 8 for normal business hours.


G20 To Keep Stimulus Going - According to a report by Reuters, when the G20 finance leaders and central bankers meet over the weekend in London, they will promise to keep economic support packages in place until recovery is certain and seek to reassure financial markets they have credible plans to withdraw the stimulus when appropriate.

This stance is partly in response to a revised economic growth report from the IMF that now forecasts global shrinkage of 1.3% in 2009 (-1.4% in April) and growth of 2.9% in 2010 (2.5% in April). Policymakers are cautious about declaring victory yet, especially given most major economies are still shrinking this year and only expected to post sluggish growth next year.

"Unwinding the stimulus too soon runs a real risk of derailing the recovery, with potentially significant implications for growth and unemployment," said IMF chief Dominique Strauss-Kahn at a conference in Berlin on Friday.

"The biggest risk is to think that the job's done -- that recovery is guaranteed. No country can be complacent -- we've got to see this through," British finance minister and meeting host Alistair Darling said late on Thursday.

Still, with interest rates at record lows and trillions of dollars thrown into their economies to fight the crisis, policymakers are keen to show they have exit strategies in place lest financial markets take fright that inflation will rocket and public finances fall apart.

"Now is not the time to exit. But I would like to make it clear that the ECB has a strategy, and we stand ready to put it into action when the appropriate time comes," said European Central Bank President Jean-Claude Trichet said in Frankfurt.

Unemployment Rises to 9.7% - The Labor Department reported Friday that the unemployment rate rose to 9.7% in August as nonfarm payrolls fell by 216,000. Payrolls have dropped by 6.9 million to 131.2 million since the recession began in December 2007, the government data showed. Unemployment has increased by 7.4 million during the recession to 14.9 million. The 216,000 decline in payrolls was close to market expectations of a 233,000 drop. It was the smallest decline in payrolls since August 2008.


Once and Future Taxes - The New York Times - "So far, the Obama administration’s plan for dealing with the budget deficit — an estimated $9 trillion over a decade — is to not dig the hole any deeper. That’s an important first step. President Obama deserves credit for proposing ways to pay for his two big initiatives to date: health care reform and energy legislation. Reducing the growth in health care costs, in particular, is vital to curbing future deficits."

Financial Stability Depends on More Capital - By Timothy Geithner - Financial Times - "We have sought to contain this moral hazard through regulation. We require financial institutions to maintain reserves and capital buffers in proportion to their risk so that they can absorb losses at their own expense, not at the taxpayer’s."

Customers Angered as iPhones Overload AT&T - By Jenna Wortham - The New York Times - I have an iPhone. It is a great tool with great functionality and applications. I have also said that if Apple ever figures out how to fix the "phone" on the iPhone, it will be the best (dropped calls in and outside 285). Now, an article somewhat explains my frustrations... "When thousands of iPhone owners descended on Austin, Tex., in March during South by Southwest, an annual technology and music conference, attendees were unable to send text messages, check their e-mail or make calls until AT&T installed temporary cell sites to amplify the service."

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