Monday, August 29, 2011

Pound Goes Down as UK Economy Slows

Great Britain poundThe Great Britain pound weakened against the Japanese yen and slowed its advance versus the US dollar after the report showed the UK economy grew with slower pace in the second quarter.

The revised figure for growth of UK gross domestic product in the second quarter of 2011 was 0.2 percent, the same as in the preliminary estimate. It indicates slower expansion, compared to 0.5 percent growth in the first quarter. The report also mentioned that several special events affected Britain’s economy in Q2: the additional April public holiday, the royal wedding and the aftereffects of the Japanese tsunami.

GBP/JPY fell from 126.12 to 125.68 today as of 9:24 GMT and touched the daily low of 125.41 earlier. GBP/USD climbed from 1.6278 to 1.6332.

If you have any questions, comments or opinions regarding the Great Britain Pound, feel free to post them using the commentary form below.

Earlier News About the Great Britain Pound:

    * GBP Falls vs. EUR with Consumer Confidence & Retail Sales (2011-08-25)
    * Pound Rises as Inflation Accelerates (2011-08-16)
    * Osborne Refuses Review Spending Cuts, Boosting Pound (2011-08-12)
    * Pound Drops with Higher Trade Deficit (2011-08-09)
    * Pound Weakens on Worsening Consumer Sentiment (2011-07-21)

Perry: Too soon to judge Obama’s handling of Hurricane Irene

posted at 3:30 pm on August 28, 2011 by Tina Korbe

Maybe it’s because the state of Texas has weathered higher category hurricanes with far less fuss than that with which the East Coast is presently handling Hurricane Irene, but Texas Gov. Rick Perry refuses to allow the abundant meteorological moments of this week overshadow the economy. Political Ticker reports:

    The Texas governor appeared at a county GOP picnic in Des Moines on Saturday. During an exchange with reporters, Perry was asked if the president has been an effective leader during a week that saw two menacing natural disasters: an earthquake and currently the hurricane.

    Though Perry would not cast judgment, he did cast his answer in overtly political terms.

    “He has been an absolute disaster as a president from the standpoint of our economy. That’s what people are really focused on,” Perry said. “Taking a snapshot of whether or not he’s appropriately dealt with the hurricane – I don’t know yet. I’ll tell you when the hurricane’s over.”

Frankly, the news media ought to take a leaf out of Perry’s book and remember the economy even in the midst of a rocky weather week. Irene has already caused significant inconvenience to coasters (as Ed reported this morning, 3 million are without power) and, even more tragically, has resulted in at least one death, but the media devoted so much time to the earthquake and pre-storm prep (probably because most of the media is on the East Coast) that the president essentially received a free pass on the dismal economic news that also emerged this week. Weekly jobless claims rose by 5,000. Home mortgage applications dropped to a new 15-year low. The CBO’s positive predictions of deficit reduction were based on measures that will never take effect.

Of course the media should have devoted a significant amount of attention to the earthquake and to Hurricane Irene. Natural disasters are without question newsworthy — and, if Hurricane Katrina taught us anything, it’s that it would always be better to have too much media coverage on the front end than a need for endless media coverage on the back end. But it did seem eventually to grow a little out of proportion. I’ll be eager to read any Pew-Project-for-Excellence-in-Journalism-type research that breaks down the exact distribution of the news this week.

At one point, I found myself so perplexed by the hype (The Weather Channel, for example, featured a reporter dramatically bemoaning roughly 25 mph winds — a relatively common day in states like Oklahoma and Kansas!) that I began to brainstorm conspiracy theories. Could it be, I wondered, that the media wants to concoct a more extreme disaster the president could then be demonstrated to have capably “solved,” to have adequately addressed? (Political Ticker’s headline for the story above helps this theory along, actually: “Perry not ready to praise Obama’s handling of Hurricane Irene,” the hed writer writes, as though it’s automatic and obvious that his handling of the storm should be praised. But, then, I tend to read too much into things.)

I don’t really think that, of course. I think it’s August and news is slow — and, anyway, as it turns out, Irene did hit North Carolina with 85 mph winds — winds well worthy of a bit of bemoaning. By the time it hit the Northeast, it was just a tropical storm, but still damaging. Still, throughout the week, I found Fox News’ Shepard Smith’s consistent talk-down of both weather-related events refreshing and I find Perry’s comments particularly apt now.

The Texas governor followed up his pseudo-criticism of the president with an important reminder: State-level leaders, even more so than the president or other national bureaucrats, will bear the brunt of responsibility of cleaning up after the storm.

“Those governors of those states along the Eastern Seaboard are the ones that are actually going to be making the decisions that save the lives, that prepare for this hurricane, that do the search and rescue, and then frankly – do the first part of the recovery,” Perry said.

Yep. Sure, federal-level disasters mandate a federal-level response, but, in America, folks pitch in and help their neighbors in an emergency. They don’t just wait for FEMA to inefficiently address their problems or for the president to glibly gloss over policy-created crises to wax eloquent about matters out of his control. Or, at least, in the America of my imagination, they don’t. Wish that were always the reality, as well.

Fundamentals are Bad for US Dollar, But Week Wasn’t Bad

US DollarThe fundamentals this week were negative for the US dollar, weakening the currency against some major counterparts, but performance of the greenback wasn’t that bad, considering all the pressure to the downside.

There were plenty of bad new for the dollar this week. Bad housing data, rising unemployment claims and slower that expected growth of the US economy. The week ended with the speech of Ben Bernanke, who hinted at possibility of additional stimulus without detailing an actual plan.

The dollar was dragged down by the unfavorable fundamentals and fell against the euro and commodity currencies (including the currencies of Canada, Australia and New Zealand). On the other hand, the dollar gained against the franc and rallied versus the yen before losing its gains by the end of the week as there aren’t many choices for investors who need a safe currency, but afraid of interventions of Japan and Switzerland. The pound also fell against the greenback as Britain has its own problems that erase attractiveness of the nation’s currency.

Next week may also be hard for the dollar. Analysts predict another unfavorable report about hosing and are pessimistic about employment data.

EUR/USD climbed from 1.4376 to 1.4498, while during the week it dropped to 1.4327. USD/CHF climbed from 0.7904 to 0.8058 and reached the daily high of 0.8157. AUD/USD surged from 1.0380 to 1.0569.

If you have any questions, comments or opinions regarding the US Dollar, feel free to post them using the commentary form below.

Earlier News About the US Dollar:

    * Dollar Drops After Bernanke Speech & GDP Report (2011-08-26)
    * Will Bernanke Announce QE3? Will Dollar Decline? (2011-08-25)
    * Dollar Gains Before Bernanke Speech (2011-08-24)
    * Dollar Falls on China's & Europe's Manufacturing (2011-08-23)
    * Dollar Rises While Traders Afraid of Recession (2011-08-18)

Why is the media so ignorant about religion?

posted at 2:00 pm on August 28, 2011 by Ed Morrissey

A few days ago, the New York Times’ Bill Keller proposed asking “tougher questions” of presidential candidates about their faith, causing an uproar in both political and religious circles:

    This year’s Republican primary season offers us an important opportunity to confront our scruples about the privacy of faith in public life — and to get over them. We have an unusually large number of candidates, including putative front-runners, who belong to churches that are mysterious or suspect to many Americans. Mitt Romney and Jon Huntsman are Mormons, a faith that many conservative Christians have been taught is a “cult” and that many others think is just weird. (Huntsman says he is not “overly religious.”) Rick Perry, Michele Bachmann and Rick Santorum are all affiliated with fervid subsets of evangelical Christianity, which has raised concerns about their respect for the separation of church and state, not to mention the separation of fact and fiction.