IMF to lower its economic forecast
The International Monetary Fund’s Managing Director, Christine Lagarde, expressed concern on Friday over the deterioration of the global economy, as reported by CNBC. Lagarde indicated that it appeared that the economies of both major and emerging nations are slowing down and the IMF will downgrade its forecasts later this month. The IMF had revised it global growth forecast up in April from 3.3 percent to 3.5 percent. Based upon Lagarde’s remarks, as well as the European Central Bank, the Bank of England and China all easing monetary policy on Thursday, the Dow fell 47 points to close at 12,896. Asian markets are mixed on Friday and European markets are mostly down.
Meat producers face growing feed costs
According to the Financial Times, meat producers in the US are about to face a hit to profits as the cost of animal feed increases exponentially. Animal feed is generally a soyabean meal, made from crushed oilseed and mixed with corn. On Thursday, the soyameal futures hit a record $475 per short ton. Corn was also at its highest in more than a year. Poultry eat more than 40 percent of the US soyabean crop. Expect the drought and heat in the Midwest to impact meat prices in the near future.
Amazon to offer smartphone to compete with Apple
Bloomberg reports that Foxconn International Holdings, Ltd.,the Chinese mobile phone maker, is working with Amazon to create a mobile phone to compete against Apple and devices that use the Android system. A smartphone would give Amazon a wider range of low priced hardware devices that could bolster its strategy of selling books, songs and movies.
House bill to cut food stamps and farm subsidies
The House Agriculture Committee on Thursday unveiled a long term farm and food bill that would reduce spending by $3.5 billion per year, according to the Associated Press. The bill promotes reducing current food stamp spending by $1.6 billion a year, four times the amount of cuts incorporated into the Senate bill. Food stamps make up 80 percent of the $100 billion farm bill. Democrats claim that food stamps feed 46 million people or 1 out of every 7 Americans. The current farm bill expires September 30 and this will be a political challenge for Congress in an election year.
US Presbyterians reject divestment of stocks of companies selling to Israel
By a slim 2 vote margin, the Presbyterian General Assembly decided to retain its investment in firms that do business with Israel, according to the Associated Press. Many large institutional investors are divesting from firms that do business with Israel such as Caterpillar, Hewlett Packard and Motorola. The pressure has been coming from pro-Palestinian groups that say these companies profit from Israel and the Israeli soldiers use these products to hurt the Palestinians. Recently some pension funds in Norway and Sweden have divested from companies that invest in Israel. Last week a large US investment firm, MSCI, announced it had removed Caterpillar from three of its socially responsible funds. This caused mutual fund provider TIAA-CREF to divest of Caterpillar as well.
Restaurant chains promote sugary drinks for breakfast
In defiance of Mayor Bloomberg’s stand on selling large sugary drinks, three restaurant chains have begun promoting sugary drinks in the morning as an alternative to coffee. Taco Bell, Steak n Shake, and Sonic all have morning soft drink promotions, according to USAToday. Soft drinks are very profitable for fast food chains and the promotion seems to be working. Morning soft drink sales at major chains rose 3 percent in the last year compared to a 3 percent drop the year before.
Source: http://www.millionairecorner.com/article/news-analysis-investor-july-6-2012
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