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Insurer Misselling, 30’s feeling, shady MF deals, Yuan unpegged

MoneyLife: Insurer admits mis-selling (Birla Sun Life)

After Tara Foods, Fatpipe Networks withdraws its IPO.

Krugman: That 30’s feeling. Focus on jobs, not austerity, he says. Yes, that will mean more borrowing and later inflation and it will mean debt interest rates will go up etc. I believe it’s time the US thought out a way to strategically default on its debt. Whatever you do, non US people, don’t lend any more money to them. Now if the RBI could please cut those reserves and convert them to Indian debt instead.

ET: Mutual Funds Cut Shady Deals with to mask losses. With the markets needing liquidity, corporates are withdrawing from mutual funds. MFs are unwilling to sell their holdings at a loss – which they have to as yields go higher in this temporary liquidity crisis – so they borrow from banks offering their securities as collateral, promising to buy them back a few days later when, hopefully, the crisis will be over and the money will come back. After July 1, such shady deals won’t be possible.

China says it will unpeg the Yuan Renminbi from the US Dollar. Didn’t seem to do much today.

  • MG says:

    >I didn't find the China notice indicating that it would unpeg vs the dollar. Its very ambiguous. It looks more like rationalizing the status quo than any change in policy. Isn't it?

    "continued emphasis would be placed to reflecting market supply and demand with reference to a basket of currencies. The exchange rate floating bands will remain the same as previously announced in the inter-bank foreign exchange market."

    "maintain the RMB exchange rate basically stable at an adaptive and equilibrium level"

    About the US, why in the world would they default when they can depreciate? And, non-US people don't seem to want to not lend (ala China above?)