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One Response to “Financial News 8/31/12 – Bernanke at Jackson Hole, Abramovich, Tsunami Warning, Spain Wildfire”

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   31. Aug, 2012

   Federal Reserve Chairman Ben Bernanke is expected to acknowledge the U.S. central bank is actively considering another round of monetary easing in his keynote Jackson Hole speech today. But there is also big potential for disappointment for the financial markets, if he does not indicate the bond buying program is imminent. In the past Jackson Hole has not been a staging ground for big policy announcements, but investors are nevertheless hoping to get some clear statements from Mr. Bernanke, to show us the light at the end of the tunnel. And to give you a bit of a back ground: The Fed adjusts interest rates to influence the economy – low rates typically fuel economic growth by encouraging borrowing, spending and investment, while high rates do the opposite. With short-term interest rates pinned near zero, the Fed is deploying other tools, including long-term bond-buying, and jawboning on rate plans, to stimulate markets and the economy. Beyond this big question, a broader question looms in Jackson Hole, about Mr. Bernanke’s legacy. Long after his term as chairman ends in 17 months, will he be remembered as the Fed chief who did too little to combat high unemployment or the one who did too much and unleashed inflation and financial instability with the actions he took? Critics make both arguments.

   From the world of the rich and greedy, Britain’s High Court dismissed a lawsuit brought by Boris Berezovsky against rival Russian tycoon Roman Abramovich < http://topics.wsj.com/person/r/abramovich-roman/6391> , handing a high-stakes victory to Mr. Abramovich in a larger-than-life, multiyear legal battle. Mr. Berezovsky, a tycoon who dominated Boris Yeltsin’s Russia, before falling out with President Vladimir Putin and fleeing to Britain 11 years ago, sought $6 billion in damages from his one-time protégé, Mr. Abramovich, the owner of Chelsea Football Club, and one of Russia’s richest men. Mr. Berezovsky accused Mr. Abramovich of intimidating him into selling a stake in oil giant Sibneft in 2001 for $1.3 billion, an amount the exiled tycoon has described as a fraction of the share’s real value. Mr. Berezovsky also alleged that Mr. Abramovich secretly sold interests in Russian aluminum giant Rusal, that had been held for Mr. Berezovsky in trust. Mr. Abramovich denied Mr. Berezovsky owned any part of either company. High Court Justice Elizabeth Gloster dismissed Mr. Berezovsky’s claims, in relation to both the Sibneft stake and the Rusal interests. And thus ends another battle of the titans, and I am sure it will not be the last.

   In breaking news today: A tsunami warning has been issued for the Philippines, Indonesia and other parts of the Pacific Ocean after a 7.9-magnitude earthquake offshore. There are no details of any damage or casualties from the quake. It is not yet known if a tsunami has actually been generated.

   In Marbella, Spain, a massive wildfire has approached the wealthy resort on the Costa del Sol, where the authorities have evacuated thousands of people, already. Marbella is famous for its up-market hotels and villas – it is a favorite haunt of wealthy foreigners, and this wildfire came as a shock to many. So far one fatality has been reported. According to Spanish newspaper El Pais, more than 250 firefighters are battling the fire, helped by 17 aircraft dropping water to extinguish it. According to our witness reports, people were woken in the middle of the night by the smell of the fire, before being evacuated. While speaking to our witness I heard multiple planes flying in the background, it seems Spanish authorities are doing everything they can, and are at this moment ruling out that the fires were started deliberately. Stay safe everyone.