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Small investors stage street protests in Dhaka, Bangladesh, on Sunday after the stock market's steepest fall in a single day
Ordinary Bangladeshis have been tempted into the stock market by higher returns than banks.

Hundreds of angry investors have staged protests in the Bangladeshi capital, Dhaka, after the stock exchange saw its steepest ever fall in a day.

Reports said they threw bricks at police, marched in the streets shouting slogans, and staged a sit-down protest.

Shares in the stock exchange suffered large falls within hours of opening on Sunday as panicked investors went on a selling spree.

The index ended the day down by 552 points or 6.72%.

It has been on a rollercoaster ride in recent weeks, hitting a record high on 5 December, having climbed 80% since the start of the year.

But on 8 December it nosedived, prompting protests in Dhaka and towns elsewhere.

On Sunday, at least 500 investors hurled bricks at law enforcement officers near the Dhaka Stock Exchange and the Securities and Exchange Commission (SEC) offices, said local police chief Tofazzal Hossain according to AFP news agency.

"They chanted slogans against the government and the regulators, and marched through the busy roads in the Motijheel Commercial area, halting traffic. They also staged a sit-in at the SEC building," he said.

Analysts say Sunday's index fall was triggered by a central bank interest-rate hike.

The regulators have also taken measures in recent weeks to restrict money supply into the share market after concerns that stocks were overvalued.

The move forced big institutional investors to withdraw from the market, triggering panic among individual investors.

The rising value of the stocks in recent years has attracted hundreds of thousands of small-scale or retail investors in Bangladesh, says the BBC's Anbarasan Ethirajan in Dhaka.It became a popular investment for ordinary people, often providing higher returns than bank deposits and savings.Regulators have now agreed to relax some of the conditions, hoping that will increase the money supply and stabilise the market, he says.


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Abby Cohen and Mathew McLennan 26min Interview

On this week's Consuelo Mack WealthTrack, a powerful financial duo! Goldman Sachs' veteran investment strategist, Abby Joseph Cohen and First Eagle Fund's global value manager Matthew McLennan, discuss the new world economic order and how investors can take advantage of it.

 

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Gerald Celente:Wake-Up Call:Top 11 Trends of 2011

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After the tumultuous years of the Great Recession, a battered people may wish that 2011 will bring a return to kinder, gentler times.  But that is not what we are predicting.  Instead, the fruits of government and institutional action – and inaction – on many fronts will ripen in unplanned-for fashions.  Trends we have previously identified, and that have been brewing for some time, will reach maturity in 2011, impacting just about everyone in the world.

1.  Wake-Up Call In 2011, the people of all nations will fully recognize how grave economic conditions have become, how ineffectual and self-serving the so-called solutions have been, and how dire the consequences will be.
Having become convinced of the inability of leaders and know-it-all “arbiters of everything” to fulfill their promises, the people will do more than just question authority, they will defy authority.  The seeds of revolution will be sown….

2.  Crack-Up 2011  Among our Top Trends for last year was the “Crash of 2010.”  What happened?  The stock market didn’t crash.  We know.  We made it clear in our Autumn Trends Journal that we were not forecasting a stock market crash – the equity markets were no longer a legitimate indicator of recovery or the real state of the economy.  Yet the reliable indicators (employment numbers, the real estate market, currency pressures, sovereign debt problems) all bordered between crisis and disaster.
In 2011, with the arsenal of schemes to prop them up depleted, we predict “Crack-Up 2011”: teetering economies will collapse, currency wars will ensue, trade barriers will be erected, economic unions will splinter, and the onset of the “Greatest Depression” will be recognized by everyone….

3.  Screw the People  As times get even tougher and people get even poorer, the “authorities” will intensify their efforts to extract the funds needed to meet fiscal obligations.  While there will be variations on the theme, the governments’ song will be the same: cut what you give, raise what you take.

4.  Crime Waves
No job + no money + compounding debt = high stress, strained relations, short fuses.  In 2011, with the fuse lit, it will be prime time for Crime Time.  As Gerald Celente says, “When people lose everything and they have nothing left to lose, they lose it.”
Hardship-driven crimes will be committed across the socioeconomic spectrum by legions of the on-the-edge desperate who will do whatever they must to keep a roof over their heads and put food on the table….

5.  Crackdown on Liberty
As crime rates rise, so will the voices demanding a crackdown.  A national crusade to “Get Tough on Crime” will be waged against the citizenry.  And just as in the “War on Terror,” where “suspected terrorists” are killed before proven guilty or jailed without trial, in the “War on Crime” everyone is a suspect until proven innocent….

6.  Alternative Energy In laboratories and workshops unnoticed by mainstream analysts, scientific visionaries and entrepreneurs are forging a new physics incorporating principles once thought impossible, working to create devices that liberate more energy than they consume.
What are they, and how long will it be before they can be brought to market?  Shrewd investors will ignore the “can’t be done” skepticism, and examine the newly emerging energy trend opportunities that will come of age in 2011….

7.  Journalism 2.0  Though the trend has been in the making since the dawn of the Internet Revolution, 2011 will mark the year that new methods of news and information distribution will render the 20th century model obsolete. 
With its unparalleled reach across borders and language barriers, “Journalism 2.0” has the potential to influence and educate citizens in a way that governments and corporate media moguls would never permit.  Of the hundreds of trends we have forecast over three decades, few have the possibility of such far-reaching effects….

8. Cyberwars  Just a decade ago, when the digital age was blooming and hackers were looked upon as annoying geeks, we forecast that the intrinsic fragility of the Internet and the vulnerability of the data it carried made it ripe for cyber-crime and cyber-warfare to flourish. 
In 2010, every major government acknowledged that Cyberwar was a clear and present danger and, in fact, had already begun.  The demonstrable effects of Cyberwar and its companion, Cybercrime, are already significant – and will come of age in 2011.  Equally disruptive will be the harsh measures taken by global governments to control free access to the web, identify its users, and literally shut down computers that it considers a threat to national security….

9.  Youth of the World Unite  University degrees in hand yet out of work, in debt and with no prospects on the horizon, feeling betrayed and angry, forced to live back at home, young adults and 20-somethings are mad as hell, and they’re not going to take it anymore.  Filled with vigor, rife with passion, but not mature enough to control their impulses, the confrontations they engage in will often escalate disproportionately.
Government efforts to exert control and return the youth to quiet complacency will be ham-fisted and ineffectual.  The Revolution will be televised … blogged, YouTubed, Twittered and….

10.  End of The World!  The closer we get to 2012, the louder the calls will be that the “End is Near!”  There have always been sects, at any time in history, that saw signs and portents proving the end of the world was imminent.  But 2012 seems to hold a special meaning across a wide segment of “End-time” believers. 
Among the Armageddonites, the
actual end of the world and annihilation of the Earth in 2012 is a matter of certainty. Even the rational and informed that carefully follow the news of never-ending global crises, may sometimes feel the world is in a perilous state.  Both streams of thought are leading many to reevaluate their chances for personal survival, be it in heaven or on earth….

11.  The Mystery Trend ... will be revealed upon publication of the Trends Journal in mid-January.
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This is a holiday week (Merry Christmas!), but there will still be plenty of economic releases. There are two key housing reports: November existing home sales on Wednesday, and New home sales on Thursday.

----- Monday, Dec 20th -----


8:30 AM ET: Chicago Fed National Activity Index (November). This is a composite index of other data.

Morning: Moody's/REAL Commercial Property Price Index (CPPI) for October.

----- Tuesday, Dec 21st -----


11:00 AM: The U.S. Census Bureau will release key 2010 Census data at a news conference in Washington, D.C. "The 2010 Census data to be released include the resident population for the nation and the states as well as the congressional apportionment totals for each state".

----- Wednesday, Dec 22nd -----


7:00 AM: The Mortgage Bankers Association (MBA) will release the mortgage purchase applications index. This index declined sharply following the expiration of the tax credit, and the index has only recovered slightly since then.

8:30 AM: Q3 GDP (third estimate). This is the third estimate for Q3 from the BEA, and the consensus is for real GDP growth to be revised to an increase of 2.8% annualized from the second estimate of 2.5%.

8:30 AM: Corporate Profits, 3rd quarter 2010 (second estimate)

10:00 AM: FHFA House Price Index for October. This is based on GSE repeat sales and is no longer as closely followed as Case-Shiller (or CoreLogic).

10:00 AM: Existing Home Sales for November from the National Association of Realtors (NAR). The consensus is for sales of 4.85 million at a Seasonally Adjusted Annual Rate (SAAR) in November, up about 7% from the 4.43 million SAAR in October.

Existing Home Sales Click on graph for larger image in graph gallery.

This graph shows existing home sales, on a Seasonally Adjusted Annual Rate (SAAR) basis since 1993. Sales in October 2010 were at a 4.43 million SAAR). Housing economist Tom Lawler is estimating an increase to 4.61 million (SAAR) in November.

In addition to sales, the level of inventory and months-of-supply will be very important (since months-of-supply impacts prices).

----- Thursday, Dec 23rd -----


8:30 AM: The initial weekly unemployment claims report will be released. The number of initial claims has been trending down over the last couple of months. The consensus is for the same as last week at 420,000.

8:30 AM: Personal Income and Outlays for November. The consensus is for a 0.2% increase in personal income and a 0.5% increase in personal spending, and for the Core PCE price index to increase 0.1%. This is a key report for estimating the growth in Q4 PCE using the two-month method.

8:30 AM: Durable Goods Orders for November from the Census Bureau. The consensus is for a 0.7% decrease in durable goods orders after decreasing 3.3% in October.

9:55 AM: Reuter's/University of Michigan's Consumer sentiment index (final for December). The consensus is for an increase to 74.5 from the preliminary reading of 74.2.

10:00 AM: New Home Sales for November from the Census Bureau. The consensus is for an increase in sales to 300K (SAAR) in November from 283K in October.

New Home Sales and Recessions This graph shows New Home Sales since 1963. The dashed line is the current sales rate.

New home sales collapsed in May and have averaged only 290K (SAAR) over the last six months. Prior to the last six months, the previous record low was 338K in Sept 1981.

----- Friday, Dec 24th -----


U.S. Markets Closed: Christmas Holiday observed

----- Saturday, Dec 25th -----


12:01 AM: Santa Claus arrives.

Happy Holiday to All!

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PIGS Exposure Table, Explaining the Panic by Numbers;

Exposure to Spain
Germany - $216.6 billion
France - $201.3 billion
Great Britain - $136.5 billion
US - $172.8 billion

Exposure to Ireland
Germany - $186.4 billion
France - $77.3 billion
Great Britain - $187.5 billion
US - $108.3 billion
Spain - $17.7 billion

Exposure to Portugal
Germany - $44.3 billion
France - $48.5 billion
US - $35.6 billion
Spain - $98.3 billion

Exposure to Greece
Germany - $65.4 billion
France - $83.1 billion
US - $36.2 billion

http://globaleconomicanalysis.blogspot.com/

 

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The major stock market indexes have opened up basically flat again this morning. Many traders and investors are talking about the Bush tax cut extension that is expected to be signed by President Obama as a market catalyst . This tax cut extension was already factored in by the stock market and is really not having much effect on the major stock indexes. 

Next there is the quadruple witching options expiration today. This is a time when contracts will expire in stock index futures, stock index options, stock options and single stock futures. This event takes place once a quarter. Therefore, there will be four quadruple witching options expiration a year. They will occur in March, June, September, and December. During this period it is always prudent to be prepared for the unexpected. Often stocks will trade very erratic during the week leading up to the Friday expiration. This type of wild and volatile action is because the institutional money will move stocks the way they see fit. They do this in order to move the stock toward or away from the popular strike price. In other words there will be a lot of games played during the week by the big money.

Last we have the action in the U.S. Dollar Index. As we have all learned by now when the U.S. Dollar Index is trading lower the stock market will usually inflate and trade higher. This morning the U.S. Dollar Index is actually trading higher by 0.02 cents to $80.20. Therefore, the stock market is slightly lower to start the day. Traders should always keep one eye on the U.S. Dollar Index chart as the stock market will usually trade inverse to the U.S. Dollar Index.

Today is a Friday and rarely does the stock market decline sharply on a Friday. In the past 24 months there have been less than a dozen times when the Dow Jones Industrial Average closed lower by more than 100.00 points on a Friday. It is important to note that the Federal Reserve and the major institutions that move markets do not want to cause panic in the U.S. consumer over the weekend. This is when the U.S. consumer is likely to go out and spend money. In order for the quantitative easing to work for a while the U.S. consumer must spend money. Please understand that U.S. consumer spending accounts for 70.0 percent of the gross domestic product(GDP) in the United States. 

The second reason that major market indexes rarely decline sharply on a Friday is because these same institutional powers that can move markets do not want to panic Asia. Please remember the Asian markets open on Sunday evening due to the different time zone. This is now a global economy and if the Asian markets decline sharply this could spill over into the fragile European and American markets on Monday. Therefore, we always just expect a flat Friday trading day. We call this the 'Friday Effect'.

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