For those who consider rice a staple and live in rice importing countries, you may want to buy some for your home cooking. The record Thai floods are believed to have damaged a significant volume of rice crops. This may result in possible shortages and price hikes.
The Euro zone was strangely quiet on Monday. Hopefully, there would be more constructive developments today. Although there has been a lot of talk and agreements appear to be closer to finalization, there has been a lack of breakthroughs. A close look at Italy reveals it may be on the verge of contagion, and it seems politically inept to enact the necessary financial measures.
The WSJ reports, Mr.Berlusconi’s government has spent the summer unveiling one package of overhauls after another, only to have them watered down by an uncooperative Parliament. Perhaps, this is another case of the “boiled frog syndrome”. It will take an immediate financial disaster, as has happened with Greece, for Italian leaders to change their tune. That’s the nature of the political beast.
The technical rally in world stocks continues, lead by the DJIA which gained another 104.83 points (+0.89%). The current uptrend is quite amazing and reminds me of the strong local market just before the US debt impasse.
Greece, mirroring the unrest of its citizens, has been noisily asking for a huge debt writedown.
Spain, another possible front in the battle against debt contagion, has been strangely quiet. Observers believe they will struggle to meet their deficit reduction targets, raising their refinancing costs, resulting in a vicious cycle.
At least, Germany and France appear to be on the same page. A reason for hope.
All-in-all, I still think Europe is screwed and will trade appropriately.