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Jan 18, 2010

Gata Dispatches: World council aims to push indians out of real metals into paper

World Gold Council aims to push Indians out of real metal into paper

WGC to Launch New Paper Gold in India
From Commodity Online
Ahmedabad, India
Monday, January 18, 2010
MUMBAI -- After tasting success with its campaign to sell gold coins across India's post offices, the World Gold Council is getting ready to launch a new version of gold traded on paper in India. The new form of paper gold, just like the gold ETFs, will be launched in the Indian market in the next few months.
According to WGC India Managing Director Ajay Mitra, India offers tremendous potential not just in the sale of physical gold but in all forms of gold transaction methods. While India has six gold ETFs successfully running and attracting good investments, WGC is talking to a number of players to launch a new version of gold traded on paper.
India is one of largest consumers and importers of the yellow metal in the world. While most Indians prefer buying gold jewellery and gold coins as investment, a large number of investors are now scouting for investment-led gold instruments like ETFs.
"We hope to launch newer paper gold -- gold traded on paper in India -- by June this year. The paper gold will be stored by a custodian, whoever is channelising that venture," Mitra said.
He said India Post, the post services department of the Indian government, could be an ideal partner for the distribution of the new gold ETFs. India Post has partnered with WGC in promoting and selling gold coins across hundreds of post offices in the country.
The WGC official said that the apex gold body has decided to launch the new paper gold in India as consumers have been saying that storing physical gold at their homes is becoming very inconvenient.
The paper gold instrument will help investors and customers in getting rid of storing their precious gold. India Post officials said as per the new initiative, a customer can buy paper gold from any of their branches and keep it as safe investment.
Bullion experts believe that the new paper gold idea from WGC will drive up gold investment demand in India.
"It is going to be a wonderful idea, if a new form of paper gold can be launched in association with WGC in India. I am sure thousands of people will just buy paper gold from post offices instead of physical gold from jewellery shops as investment. This will push up gold demand in India," Kiram Mehta, a bullion analyst in Mumbai, told Commodity Online.
Mehta said different types of paper gold instruments can be launched in India in tieups with broking houses, institutions, and banks. "This is a really big opportunity that can catch up the investor appetite for gold in India," he added.
Across the world, paper claims to physical gold have proliferated during the past two decades.

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Forex Time Zone Converter

The Forex market operates 24 hours continuously, starting Sunday at 5:00 p.m. EST  and ending  Friday at 5:00 p.m.. Most traders ,operates in the market, during their respective, time zones working hours.

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It is a benchmark that prices reach their peak when the Asian markets including Australia and New Zealand open their operations. The American and European markets will be  opened around the same time or simultaneously. These hours must be taken in mind,in your evaluation of exchange rates when opening or closing operations.

I had found an excellent tool for those who would to know wich markets are opened at the time they begin their operations. This converter is great and will help a lot for beginners and some with relative experience in the Forex Market.  Click the link below that will take you to a great tool.


 Fernando Guzmán Cavero

Cadbury closer to 'friendly' deal with Kraft

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Cadbury closer to 'friendly' deal with Kraft

Last Update: 5:33 PM ET Jan 18, 2010

Kraft Foods Inc. is nearing a deal to buy Britain's Cadbury PLC for as much as $19 billion, according to reports late Monday. ...Read the rest of the story
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Jan 14th 2010

The rich world's debt reduction has barely begun
DELEVERAGING is an ugly word for a painful process. But few things
matter more for the world economy than whether, and how fast, the rich
world's borrowing is cut back. History suggests that severe financial
crises are usually followed by long periods of debt reduction--in which
credit falls relative to the size of the economy. This time, too, that
process is under way. Banks have been furiously reducing leverage.
Consumer credit in America has fallen for ten consecutive months, the
largest and longest drop on record. But how much further is there to go?
A new report by the McKinsey Global Institute, a research arm of the
consulting firm, tries to offer an answer. It begins by comparing the
recent evolution of debt levels in ten big rich economies and four
large emerging ones. Ratios of total debt to GDP (including debt owed
by households, government, non-financial businesses and the financial
industry) vary widely, with America's, at just under 300%, lower than
many others. But with a few exceptions, such as Germany and Japan, most
rich countries saw a huge rise over the past decade. Britain and Spain
were the most extreme, with an increase in their total-debt ratios of
more than 150 percentage points apiece, to 465% and 365% respectively.
The debt piled up in different places in different countries. With the
exception of Japan, which was dealing with the aftermath of its own
earlier asset bust, government debt as a share of GDP was mostly flat
or falling. Nor, with the exception of commercial property and
leveraged buy-outs, did the rich world's firms go on a debt binge.
Corporate leverage, measured as debt to book equity, was stable or
falling in most countries before the crisis. Financial-sector debt rose
as a share of GDP in most countries, especially Britain and Spain, and
some pockets of finance (such as investment banks) saw a huge increase
in leverage. But outside Germany and Japan, where it fell, the most
striking jump was in household debt. Most rich countries saw a rise of
more than 40% in the ratio of household debt to disposable income. Even
there, though, the rise was not uniform. In America middle-income
households built up most debt. In Spain poorer people did.
The picture McKinsey paints is one of concentrated (albeit large)
credit excesses rather than economy-wide debt binges. As a result, the
debt-reduction process will differ by sector and by country. Judged by
ratios of total debt to GDP, deleveraging has barely started. As of
June 2009 these ratios had fallen only in America, Britain and South
Korea, and not by much at that. But the composition of debt has shifted
sharply, as government borrowing has soared while private debt has
fallen. The financial sector has cut back the most. By mid-2009
financial leverage in most countries had fallen to around its average
in the 15 years before the crisis.
To pinpoint where more squeezing is likely, the study examined how far
the level and growth of debt in different sectors were out of line with
other countries and with historical averages. It also looked at
measures of borrowers' capacity to service their debts and their
vulnerability to income shocks. On this basis it could assess where the
chances of more deleveraging over the next couple of years are high,
moderate or low (see chart). Half of the ten rich countries in the
report's sample have one or more sectors that are "highly" vulnerable
to more debt reduction. Not surprisingly, these include households in
America, Britain, Spain and, to a lesser degree, Canada and South
Korea, as well as commercial property in America, Britain and Spain.
With a high risk of more corporate and financial deleveraging as well,
Spain has the rockiest road ahead. No country in the sample has much
chance of government-debt reduction over the next couple of years.
Assigning the odds of further deleveraging is not the same as gauging
its likely economic impact. To do that, the study looks to history. It
finds 32 examples of sustained deleveraging (at least three consecutive
years in which ratios of total debt to GDP fell by at least 10%) in the
aftermath of a financial crisis. In some cases the debt burden was
reduced by default. In others it was inflated away. But in about half
the cases--which the report regards as the most appropriate points of
comparison--the deleveraging came through a prolonged period of
belt-tightening, where credit grew more slowly than output. The message
from these episodes is sobering. Typically deleveraging began about two
years after the beginning of the financial crisis and lasted for six to
seven years. In almost every case output shrank for the first two or
three years of the process. (Countries which defaulted or inflated
their debt away saw bigger recessions at first, but had higher output
growth than the belt-tighteners by the end.)
Worse, there are several reasons why today's mess could be more
protracted than previous episodes. First, the scale of indebtedness is
higher. The highest debt ratio in the report's group of belt-tighteners
was 286%, in Britain after the second world war. Today more than half
the rich countries in the McKinsey sample have debt totalling more than
300% of GDP. Second, the number of countries afflicted simultaneously
means that rapid expansions of exports, which have supported output in
the past, are harder to achieve. Third, big increases in public debt,
while cushioning demand in the short term, increase the overall debt
reduction that will eventually be needed. Once private deleveraging is
done, the public sector will need to cut back.
In theory that sounds simple. In practice it will be fiendishly hard
to get the balance right. Investors may worry about the sustainability
of public debt long before private-debt reduction is over, forcing a
lot of belts to be tightened at once. The most painful bits of
deleveraging could well lie ahead.

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Forbes . com : Intelligent Investing, January 18, 2010

Intelligent Investing with Steve Forbes


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