Link: http://www.overberg.biz

INTERNATIONAL

• The Basel Committee on Banking Supervision, asked by the G20 group of nations to draft new bank rules in the aftermath of the 2008 credit crisis, softened its planned reform of bank capital and liquidity requirements.

• US durable goods orders, for big ticket items expected to last for at least 3 years, fell in June by 1 % month-on-month the largest drop since August 2009, versus a 1 % consensus forecast increase.

• The Conference Board’s US consumer confidence index fell to its lowest in 5 months in July to 50.4 from an upwardly revised 54.3 in June and below the 51.0 consensus forecast, attributed to concerns over unemployment and the housing market.

• The ABC News index of US consumer confidence fell to its lowest level in 3 months to - 48 for the week ended 25th July, down from -45 the previous week. The index hit a record low -54 in the week to 1st December 2008 and again in the week to 25th January 2009, and has been negative since March 2007.

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(from Property Trader)

According to mortgage originator ooba, the average house price rose 6,8% year-on-year in June to R837 599 (from R784 427 in June 2009), and the outlook for the SA residential property market remains positive.

“House prices are continuing to increase, albeit at a slower pace than in the past few months,” says ooba CEO Saul Geffen “We have seen a sharp recovery in house prices during the first half of this year and we are still seeing an easing in lending criteria, which is good news for potential homebuyers and the property market in general."

The ooba statistics also show that as a percentage of purchase price, the average deposit paid by home buyers has dropped from 22,5% of the price to 17% in the past year, and that the average approved bond size has increased 14,3% yoy to R695 381.

Nevertheless, the average bond decline ratio is still sitting at just under half of all applications (48,8% in June), the originator says.

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Link: http://www.overberg.biz

INTERNATIONAL

- US quarterly earnings got off to a good start with better than expected results from benchmark companies Alcoa and Intel. However, earnings are a lagging indicator, and the outlook presented on release is often more important, illustrated by JPMorgan which although beating expectations issued a cautious outlook, causing the share price to decline.

- US wholesale sales unexpectedly fell in May by 0.3 % month-on-month the 1st decline since March 2009 and against a 0.5 % consensus forecast increase. Total inventories increased 0.5 % higher than the 0.4 % consensus forecast, taking the inventory-tosales ratio, a measure of how long it would take to sell stocks at the current sales
price, to 1.14 months from April’s 1.13 months.

- The Philadelphia Fed reported a weaker than expected factory activity index, dropping in July to 5.1 against a consensus forecast 10. The New York Fed reported its manufacturing index fell to 5.08 against a consensus forecast 18.

- US producer price inflation fell for a 3rd straight month in June by -0.5 % year-on-year after falling -0.3 % in May and more than the consensus forecast -0.1 %.

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http://www.overberg.biz/

INTERNATIONAL

- The key June US unemployment report being released today is expected to show a decline in non-farm payrolls of 110,000 as many temporary workers are laid off following completion of the US census.

- Weekly new claims for US jobless benefits increased from 459,000 to 472,000 exceeding the consensus forecast 455,000.

- The US Institute of Supply Management (ISM) manufacturing index dropped more than expected in June to 56.2 from 59.7 in May and below the consensus forecast 59.0. A steep drop in the price component suggests the Fed may delay raising interest rates.

- Contracts for pending US home sales fell 30 % in May, twice the drop expected following expiry of a tax credit for 1st time buyers.

- After rising for 3 consecutive months the Conference Board’s US consumer confidence index fell significantly more than expected in June to 52.0 from 62.7 in May, attributed to uncertainty over the future state of the economy and the labour market.

- The S&P/ Case Shiller home price index unexpectedly increased 0.4 % in April against a 0.1 % consensus forecast decline and a downwardly revised 0.2 % decline in March.

- The yield on the 10-year US Treasury bond fell to 2.88 %, its lowest since April 2009, having been as high as 4 % as little as 8 weeks ago.

- The yield on the 2-year Treasury note fell below the equivalent German bund yield for the 1st time since March, coinciding with a strong 2 % euro appreciation against the US dollar on Thursday to $1.254. The rate was as low as $1.185 just 4 weeks ago.

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This article appeared in MNassa Volume 68 "Observer' Page", and was authored by Willie Koorts. Topteam's Douglas Legg in Greyton was a witness to this event. For more information read the article below.

This event was first reported to me on 18 February in a phone call by Mr. André Carstens from Wellington (South Africa). He told me about an observation that he and a group of friends (~6 people) made on Friday, 13 Feb 2009 at about 20h00 SAST.

They were sitting on a west-facing stoep in Berg-en-Dal, Wellington when they saw a bright object, relatively close to the horizon (about 10-15 degrees judging by his description), moving N-S horizontally along the horizon (similar to an airplane).

The object moved much faster than an airplane but nowhere close to a typical meteor - it took about 45 seconds to cross the sky from Paardeberg to Paarl Mountain (see Fig. 1). It disappeared over the horizon at the mountains behind Grabouw. Carstens estimated that the whole event must have lasted 2-3 minutes. The colour of the object was a pale red and it brightened towards the end with sparks coming off it. The object started breaking up near the end of the track as it disappeared over the horizon. It caused a smoke trail for most of the track which stayed visible for quite a while afterwards.

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