TOKYO (MNI) – The following are the median forecasts for Japanese
economic data due in the coming week provided by economists surveyed by
MNI.

The February current account will confirm a recovery in the trade
data released last month and show a surplus backed by brighter North
American growth prospects and solid demand from Southeast Asia as well
as a sustained income surplus.

In January, Japan logged a record high current account deficit as
exports posted the fourth straight fall on slowing global demand, the
high yen and slower shipments to China during Lunar New Year holidays.

Core machinery orders, a leading indicator of private capital
spending, are expected to post a slight fall in February, taking a
breather after surging in January, which was supported by solid domestic
demand amid easing fears of a global slump.

Japanese carmakers are seeking to raise production capacity after
the government resumed subsidies for buying low-emission vehicles in
December.

Producer prices as seen in the domestic corporate goods price index
(CGPI) will show a slight deceleration in year-on-year gains in March,
reflecting slower rises in commodity markets.

Monday, Apr. 9, 0850 JST (2350 GMT Sunday): The Ministry of Finance
releases the February current account balance. Forecast: a surplus of
Y1.134 trillion, down 33.3% on year. The trade balance will show the
first surplus in the five months, worth Y109.1 billion, but down 84.8%
y/y, and the income balance in surplus of Y1.199 trillion, up 0.2% y/y.

Wednesday, Apr. 11, 0850 JST (2350 GMT Tuesday): The Cabinet Office
releases February core machiner orders, which exclude volatile demand
from electric utilities and for ships. Forecast: -0.8% on the month, the
first fall in two months after +3.4% in January and -7.1% in December.

Thursday, Apr. 12, 0830 JST (2330 GMT Wednesday): The Bank of Japan
releases March CGPI. Forecast: +0.4% on the year, the smallest y/y gain
since -0.1% in September 2010, with the pace of growth decelerating from
+0.6% in February, +0.5% in January and +1.2% in December.

skodama@marketnews.com
** MNI Tokyo Newsroom: 81-3-5403-4838 **

[TOPICS: M$J$$$,M$A$$$,MAJDS$]

FRANCE DATA: February sa trade deficit widened to E6.398 bln from
E5.593 bln in January (revised from -E5.324 bln).
–Deficit higher than expected; MNI survey median forecast -E5.1 bln
–February sa exports +1.0% m/m; sa imports +2.8% m/m

FRANCE DATA: Jan-Feb central govt deficit E24.2 bln, down E3.8 bln y/y

– Japan Feb Prelim Coincident CI +1.0 Pt M/M; MNI Fcast +0.8 Pt
– Japan Govt Ups View: CI Shows Economy is Improving
– Japan Feb Prelim Leading CI +2.1 Pt M/M; MNI Fcast +1.3 Pt

TOKYO (MNI) – Japan’s coincident composite index (CI), which
reflects current business conditions, marked the first rise in two
months in February while the leading index continued to rise, indicating
a gradual recovery amid easing concerns about prospects for the global
economy, preliminary Cabinet Office data showed on Friday.

The coincident CI rose 1.0 point to 93.7 after dipping 0.5 point in
January.

The consensus forecast among economists polled by MNI was for a 0.8
point increase.

In February, eight out of the 11 sub-indexes comprising the
coincident index rose, led by shipments of industrial goods and those of
capital goods.

The Cabinet Office upgraded its overall assessment, saying the
composite index “shows that the economy is improving.”

In the previous month, the government said that CI “indicates that
the economy is at a turning point for an upward move.”

The composite index was set at 100 in the 2005 base year.

Other details from the latest data follow:

The leading composite index, which measures the state of the
economy three months ahead: Feb 96.6 (+2.1 points m/m) vs. Jan. 94.5
(+1.1 points), posting a fourth straight rise

The lagging CI, which reflects economic conditions three months
ago: Feb 85.6 (+2.2 point m/m) vs. Jan 83.4 (-1.5 point m/m), marking
the first rise in two months.

tokyo@marketnews.com
** MNI Tokyo Newsroom: 81-3-5403-4835 **

[TOPICS: M$J$$$,M$A$$$,MAJDS$]

TOKYO (MNI) – Bank of Japan Governor Masaaki Shirakawa and Prime
Minister Yoshihiko Noda met on Friday morning ahead of the BOJ’s policy
meeting next week, for what is believed to be a routine exchange of
views as part of their policy coordination aimed at overcoming deflation
and boosting economic vitality.

A BOJ official confirmed that the two held a meeting this morning
but declined to disclose further details.

The BOJ board will hold two policy-setting meeting this month, on
April 9-10 and again on April 27.

Shirakawa and Noda last held what they called a routine, frank
discussion on Feb. 15, a day after the BOJ board voted to conduct
further monetary easing by raising the scale of the bank’s asset-buying
program to Y65 trillion to Y55 trillion.

The Y90.3 trillion national budget for fiscal 2012 that began April
1 took effect on Thursday after a delay caused by stiff opposition to
Noda’s tax hike plans in the hung parliament. However, the government
still needs to win parliamentary approval of debt issuance for funding
the budget.

As the government plans to embark on fiscal consolidation and
double the 5% sales tax in the next few years, Noda wants the BOJ to
continue monetary easing to help Japan move out of years of deflation.

The BOJ leadership is aware that injecting massive amounts of cash
into the financial system alone will not generate new demand, but it has
promised to support the economy by keeping zero interest rates, buying
financial assets, and offering low-interest loans to support bank
lending for projects expected to boost Japan’s growth potential.

To help beat deflation, BOJ officials say, Japan must raise its
growth potential by boosting overall productivity and providing new
products and services to match the changing demands of a fast-aging
society.

As the scope for lowering the current overnight interest rate
target of zero to 0.1% is limited, the focus for any further monetary
policy easing would be on the BOJ’s unconventional measures to help
stimulate commercial bank lending, which it hopes will lift the Japanese
economy toward a sustained recovery with mild price increases.

tokyo@marketnews.com
** MNI Tokyo Newsroom: 81-3-5403-4833 **

[TOPICS: M$J$$$,M$A$$$,MMJBJ$,MGJ$$$,MT$$$$]

– Japan Mar FX Reserves $1.289 Trln Vs Feb Record $1.303 Trln

TOKYO (MNI) – Japan’s foreign reserves fell to $1.289 trillion at
the end of March from $1.303 trillion at end-February, posting the
second straight monthly drop on lower prices of U.S. Treasuries and god,
Ministry of Finance data showed on Friday.

This followed a decrease in February from a record high of $1.307
trillion marked at the end of January.

The MOF said Japan did not intervene in the forex market between
February and March after having spent Y9.09 trillion on selling yen for
the U.S. currency in the final quarter of 2011.

Japan intervened in the foreign exchange market on Oct. 31, when
the yen hit a fresh life-time high of Y75.32 versus the dollar, and
conducted further yen-selling operations from Nov. 1 to Nov. 4.

Japan’s forex reserves remain the second largest in the world after
China’s, which stood at $3.18 trillion at the end of December.

At the end of last month, Japan’s foreign currency reserves stood
at $1.21 trillion, IMF reserves at $16.92 billion, SDRs at $19.93
billion, gold at $40.90 billion and other reserve assets at $474
million.

Japan’s forex reserve data are closely watched for evidence of how
the country is managing its vast foreign currency holdings.

The biggest changes in Japan’s forex reserves usually occur when
the Bank of Japan intervenes in the currency market on behalf of the
Ministry of Finance to prevent a steep appreciation or depreciation of
the yen exchange rate.

Last year Tokyo also conducted currency market intervention in
August and March, with the latter operation forming part of a
coordinated move by the Group of Seven industrialized nations to aid
Japan in the wake of the March 11 earthquake disaster.

That intervention was the first concerted G7 forex action since
September 2000, when the euro came under heavy selling pressure as
capital flowed into the U.S. stock market at the peak of the IT bubble.

In September 2010, the reserves were pushed up by the Japanese
government’s large-scale forex intervention to sell yen for the U.S.
currency — the first government intervention in over six years — in a
bid to prevent the yen’s rapid rise from hurting exporter profits and
thus a sustained economic recovery.

Before the large-scale intervention to sell a total of Y2.125
trillion for the dollar on Sept. 15, 2010, Japan had stayed out of the
forex market since mid-March 2004, when it ended its massive
15-month-long yen-selling operation.

tokyo@marketnews.com
** MNI Tokyo Newsroom: 81-3-5403-4835 **

[TOPICS: M$J$$$,M$A$$$,MAJDS$,M$$FX$]

– Japan Mar 1st 20-Day Exports -7.3% Y/Y Vs Feb -2.7%
– Japan Mar 1st 20-Day Imports +10.5% Y/Y Vs Feb +9.2%
– Japan Mar 1st 20-Day Trade Deficit Y191.24 Bln; Surplus Yr Ago

TOKYO (MNI) – Japan’s exports slumped in the first 20 days of March
as the economy is struggling to recover from slower global growth and
the drag from the strong yen, data released by the Ministry of Finance
showed on Friday.

Exports in the first 20 days of last month fell 7.3% on the year to
Y3.64 trillion after falling 2.7% in the whole of February.

Imports rose 10.5% y/y to Y3.83 trillion in the first 20 days of
March following a 9.2% rise in the previous month.

As a result, Japan’s trade balance for the first 20 days of March
posted a deficit of Y191.24 billion after marking a small surplus of
Y29.39 billion for the whole of February and a surplus of Y459.54
billion in the first 20 days of March 2011.

Japan unexpectedly logged the first trade surplus in five months in
February on brighter North American growth prospects and solid demand
from Southeast Asia amid easing fears of the yen hurting an export-led
recovery.

tokyo@marketnews.com
** Market News International Tokyo Newsroom: 81-3-5403-4835 **

[TOPICS: M$J$$$,M$A$$$,MAJDS$]

JAPAN DATA: FX reserve data from the Ministry of Finance:
– Japan Mar FX Reserves $1.289 Trln Vs Feb $1.303 Trln
– Japan Mar FX Reserves Post 2nd M/M Drop In Row

–Retransmitting Story Published 14:56 ET Thursday

By Denny Gulino

WASHINGTON (MNI) – In signing the JOBS Act Thursday afternoon,
President Obama cheered the high-tech community of cash-hungry
entrepreneurs while angering some regulators, union backers, the AARP
and even Democratic supporters — mixing his signals to the government’s
financial regulatory troops who publicly or privately recommended
against the legislation.

The afternoon signing ceremony was accompanied by the president’s
statement of how small businesses create a big proportion of new jobs
and that the legislation is intended to help those firms grow faster.

The event put on display a rare mix of Republican and Democratic
backers, bipartisanship that masked the degree of disagreement.

“One of the great thing about America is that we are a nation of
doers,” Obama said. “We think big and take risks,” citing inventor
Edison, Ford, Boeing, Google and Twitter. “This is a country that’s
always been on the cutting edge and the reason is that America has
always had the most daring entrepreneurs in the world.”

“The last few years have been pretty tough on entrepreneurs,” he
said. “For business owners who want to take their companies to the next
level, this bill will make it easier for you to go public, and that’s a
big deal.”

“Because of this bill startups and small business will now have
access to a big new pool of American investors, namely the American
people,” he said before sitting down and applying his signature.

White House adviser Gene Sperling, given the task of defending the
legislation, had been doing interviews earlier in the day saying the
firms which will benefit the most are not brand-new startups, but those
which need to reach the next stage of their emergence, and have to raise
more funds to do so. Eventually, their easier access to start-up funds,
he said, will lead to more jobs.

Regulators, many academic experts, some Democratic lawmakers,
organized labor — and even some convicted felons — have said the law
is creating new loopholes and invitations for fraud by relaxing
regulations in place for eight decades that impose rules for disclosure
on those seeking public investment. Besides, many said, few new jobs
will result.

SEC Chair Mary Schapiro warned the Senate Banking Committee March
13 that without “appropriate protections, investors will lose confidence
in our markets” and ultimately, capital formation will become harder,
not easier. SEC Commissioner Luis Aguilar followed with similar remarks
three days later.

The AARP asked, in an objection registered with Congress, whether
older investors, already disproportionately represented among “boiler
room” and “penny stock” fraud victims, will now be an even easier target
of investment scams.

The acronym JOBS stands for Jump-start Our Business Start-ups, and
while allowing easier investment in unproven companies, limits the
amount per company any individual can give an entrepreneur under the law
to $2,000.

The law allows so-called crowd funding — basically Internet
appeals for money — a digital age innovation that can quickly aggregate
large sums without requiring as many details be made available to
investors. But in the Senate the SEC was reinserted into the process as
a necessary overseer of the crowd funding and some disclosure
requirements were added back in.

Even stronger protections advocated by Democratic Senators Carl
Levin and Jack Reed could not get the needed 60 votes.

By lending his support to a business measure, Obama was able to
apply some rhetorical judo to his Republican opponents who early on did
not expect such determined White House backing for a pro-business
measure. At the same time some of Obama’s usual Democratic supporters
have been inclined to keep any opposition more subdued than it would be
otherwise, in deference to their party’s leader.

As initial public offerings diminished after the financial crisis,
concern grew late in the past decade that the trend might continue
without some government action. The cause was taken up by Obama’s
industry dominated Council on Competitiveness.

Nevertheless Democrats like Senators Levin, Reed, Dick Durbin and
Mary Landrieu were openly critical.

For organized labor, the JOBS Bill turned out to be one more defeat
and disappointment that even a Democratic White House could not be a
reliable ally. AFL-CIO President Richard Trumka said the White House
push made him “disappointed and angry.” His opposition did not cut into
the 73 Senate votes for the bill. “When the next bubble bursts,
Americans will know who to blame,” he said.

For regulators, the signing was a different kind of defeat. The
signal from the White House that regulatory concerns about the JOBS Act
are not a high priority comes in a year when development of Dodd-Frank
regulations is stretching the resources of independent financial
regulatory agencies like the SEC, CFTC and FDIC.

At the same time their efforts have been met with repeated industry
attacks. While getting steady support from Treasury Secretary Timothy
Geithner, the strong White House support for legislation they opposed
caught them by surprise.

The JOBS act exempts companies with less than $1 billion a year in
revenues from some disclosure and governance requirements as they make
initial public stock offerings. It allows companies to raise up to $1
million a year through the “crowdfunding” mechanism and frees them to
bypass normal registration requirements to solicit investors.

** MNI Washington Bureau: 202-371-2121 **

[TOPICS: MAUDS$,M$U$$$]

WASHINGTON (MNI) – The following are excerpts from a Federal
Reserve “Policy Statement” Thursday regarding bank rentals of distressed
properties they hold in inventory:

Rental of Residential Other Real Estate Owned Properties

In light of the large volume of distressed residential properties
and the indications of higher demand for rental housing in many markets,
some banking organizations may choose to make greater use of rental
activities in their disposition strategies than in the past. This policy
statement reminds banking organizations and examiners that the Federal
Reserve’s regulations and policies permit the rental of residential
other real estate owned (OREO) properties to thirdparty tenants as part
of an orderly disposition strategy within statutory and regulatory
limits.

This policy statement applies to state member banks, bank holding
companies, nonbank subsidiaries of bank holding companies, savings and
loan holding companies, non-thrift subsidiaries of savings and loan
holding companies, and U.S. branches and agencies of foreign banking
organizations (collectively, banking organizations).

The general policy of the Federal Reserve is that banking
organizations should make good-faith efforts to dispose of OREO
properties at the earliest practicable date. Consistent with this
policy, in light of the extraordinary market conditions that currently
prevail, banking organizations may rent residential OREO properties
(within statutory and regulatory holding period limits) without having
to demonstrate continuous active marketing of the property, provided
that suitable policies and procedures are followed. Under these
conditions and circumstances, banking organizations would not contravene
supervisory expectations that they show “good-faith efforts” to dispose
of OREO by renting the property within the applicable holding period.
Moreover, to the extent that OREO rental properties meet the definition
of community development under the Community Reinvestment Act (CRA)
regulations, they would receive favorable CRA consideration.3 In all
respects, banking organizations that rent OREO properties are expected
to comply with all applicable federal, state, and local statutes and
regulations.

Background

Home prices have been under considerable downward pressure since
the financial crisis began, in part due to the large volume of houses
for sale by creditors, whether acquired through foreclosure or voluntary
surrender of the property by a seriously delinquent borrower (distressed
sales). Creditors, in turn, often seek to liquidate their inventories of
such properties quickly. Since 2008, it is estimated that millions of
residential properties have passed through lender inventories. These
distressed sales represent a significant proportion of all home sales
transactions, despite some ebb and flow, and thus are a contributing
element to the downward pressure on home prices. With mortgage
delinquency rates remaining stubbornly high, the continued inflow of new
real estate owned properties to the market — expected to be millions
more over the coming years — will continue to weigh on house prices for
some time.

Banking organizations include their holdings of such properties in
OREO on regulatory reports and other financial statements. Existing
federal and state laws and regulations limit the amount of time banking
organizations may hold OREO property. In addition, there are established
supervisory expectations for management of OREO properties and the
nature of the efforts banking organizations should make to dispose of
these properties during that period. Risk Management Considerations for
Residential OREO Property Rentals In all circumstances, the Federal
Reserve expects a banking organization considering such rentals to
evaluate the overall costs, benefits, and risks of renting. The banking
organization’s decision to rent OREO might depend significantly on the
condition of individual properties, local market conditions for rental
and owner-occupied housing, and its capacity to engage in rental
activity in a safe and sound manner and consistent with applicable laws
and regulations.

Banking organizations should have an operational framework for
their residential OREO rental activities that is appropriate to the
extent to which they rent OREO properties. In general, banking
organizations with relatively small holdings of residential OREO
properties — fewer than 50 individual properties rented or available
for rent — should use a framework that appropriately records the
organizations’ rental decisions and transactions as they take place,
preserves key documents, and is otherwise sufficient to safeguard and
manage the individual OREO assets. In contrast, banking organizations
with large inventories of residential OREO properties — 50 or more
individual properties available for rent or rented — should utilize a
framework that systematically documents how they meet the supervisory
expectations described in the next section.

All banking organizations that rent OREO properties, irrespective
of the size of their holdings, should adhere to the guidance set forth
in this section.

Compliance with maximum OREO holding-period requirements

Banking organizations should pursue a clear and credible approach
for ultimate sale of the rental OREO property within the applicable
holding-period limitations. Exit strategies in some cases may include
special transaction features to facilitate the sale of OREO, potentially
including prudent use of seller-assisted financing or rent-to-own
arrangements with tenants.

Compliance with landlord-tenant and other associated requirements

Banking organizations’ residential property rental activities are
expected to comply with all applicable federal, state, and local laws
and regulations, including: landlord-tenant laws; landlord licensing or
registration requirements; property maintenance standards; eviction
protections (such as under the Protecting Tenants at Foreclosure Act);
protections under the Servicemembers Civil Relief Act; and
anti-discrimination laws, including the applicable provisions of the
Fair Housing Act and the Americans with Disabilities Act. Prior to
undertaking the rental of OREO properties, banking organizations should
determine whether such activities are legally permissible under
applicable laws, including state laws. When applicable, banking
organizations should review homeowner and condominium association bylaws
and local zoning laws for prohibitions on renting a property. Banking
organizations may use third-party vendors to manage properties but
should provide necessary oversight to ensure that property managers
fully understand and comply with these federal, state, and local
requirements.

Other considerations

Banking organizations should account for OREO assets in accordance
with generally accepted accounting principles and applicable regulatory
reporting instructions. Banking organizations should also provide the
appropriate classification treatment for their residential OREO
holdings. Residential OREO is typically treated as a substandard asset,
as defined by the interagency classification guidelines.11 However,
residential properties with leases in place and demonstrated cash flow
from rental operations sufficient to generate a reasonable rate of
return12 should generally not be classified.

(Footnotes excluded. The full text is available on the Federal
Reserve Web site, www.federalreserve.gov)

** MNI Washington Bureau: 202-371-2121 **

[TOPICS: M$U$$$,MMUFE$,MGU$$$,MFU$$$,M$$AG$]

• Canada adds 82.3K jobs, far more than 10.5K expected
• Canada unemployment rate falls to 7.2% from 7.4%
• US initial jobless claims 357K vs 355K exp
• Canada Ivey PMI 63.5 vs 65.5 exp
• NIESR estimates UK econ grew 0.1% in Q1
• Fed’s Bullard: Best strategy may be ‘wait and see’
• German 2-year yields hit record low
• Sarkozy promises balanced budget in 2016
• Italy’s Northern League leader resigns
• Fed chief trader Brian Sack resigns
• Fallout from the breach of the EUR/CHF peg
• IMF: Spain faces severe challenges
• IMF: Portugal could be shut out of funding market longer
• S&P 500 down 0.1% to 1398
• AUD leads, EUR lags

It was a another day where trading was all over in the first two hours of US trading. EUR/USD fell to a session low of 1.3035 in the first hour of trading and then bounced to 1.3060. Thereafter it was a tight, sideways move.

Talk of further BOJ easing boosted USD/JPY to 82.44 after hitting 81.83 in Europe.

EBS confirmed the low bid at 1.1990 in EUR/CHF. We bounced to 1.2027 in early trading but edged back down to 1.2015 at day’s end. Surely, Swiss policymakers will have some sleepless nights over the Easter weekend.

USD/CAD plunged to 0.9907 from 0.9980 after the jobs report but has slowly edged back to 0.9935.

USD/JPY has edged up to the highest since early in Asia, touching 82.42. There are offers up to 82.50 so further gains will be hard to come by.

US DATA: March STRIPS total $196b, see

http://www.treasurydirect.gov/news/pressroom/pressroom_com0412.htm

Details to appear on the MNI Main wire.

By Denny Gulino

WASHINGTON (MNI) – In signing the Jobs Act Thursday afternoon,
President Obama cheered the high-tech community of cash-hungry
entrepreneurs while angering some regulators, union backers, the AARP
and even Democratic supporters — mixing his signals to the government’s
financial regulatory troops who publicly or privately recommended
against the legislation.

The afternoon signing ceremony was accompanied by the president’s
statement of how small businesses create a big proportion of new jobs
and that the legislation is intended to help those firms grow faster.

The event put on display a rare mix of Republican and Democratic
backers, bipartisanship that masked the degree of disagreement.

“One of the great thing about America is that we are a nation of
doers,” Obama said. “We think big and take risks,” citing inventor
Edison, Ford, Boeing, Google and Twitter. “This is a country that’s
always been on the cutting edge and the reason is that America has
always had the most daring entrepreneurs in the world.”

“The last few years have been pretty tough on entrepreneurs,” he
said. “For business owners who want to take their companies to the next
level, this bill will make it easier for you to go public, and that’s a
big deal.”

“Because of this bill startups and small business will now have
access to a big new pool of American investors, namely the American
people,” he said before sitting down and applying his signature.

White House adviser Gene Sperling, given the task of defending the
legislation, had been doing interviews earlier in the day saying the
firms which will benefit the most are not brand-new startups, but those
which need to reach the next stage of their emergence, and have to raise
more funds to do so. Eventually, their easier access to start-up funds,
he said, will lead to more jobs.

Regulators, many academic experts, some Democratic lawmakers,
organized labor — and even some convicted felons — have said the law
is creating new loopholes and invitations for fraud by relaxing
regulations in place for eight decades that impose rules for disclosure
on those seeking public investment. Besides, many said, few new jobs
will result.

SEC Chair Mary Schapiro warned the Senate Banking Committee March
13 that without “appropriate protections, investors will lose confidence
in our markets” and ultimately, capital formation will become harder,
not easier. SEC Commissioner Luis Aguilar followed with similar remarks
three days later.

The AARP asked, in an objection registered with Congress, whether
older investors, already disproportionately represented among “boiler
room” and “penny stock” fraud victims, will now be an even easier target
of investment scams.

The acronym JOBS stands for Jump-start Our Business Start-ups, and
while allowing easier investment in unproven companies, limits the
amount per company any individual can give an entrepreneur under the law
to $2,000.

The law allows so-called crowd funding — basically Internet
appeals for money — a digital age innovation that can quickly aggregate
large sums without requiring as many details be made available to
investors. But in the Senate the SEC was reinserted into the process as
a necessary overseer of the crowd funding and some disclosure
requirements were added back in.

Even stronger protections advocated by Democratic Senators Carl
Levin and Jack Reed could not get the needed 60 votes.

By lending his support to a business measure, Obama was able to
apply some rhetorical judo to his Republican opponents who early on did
not expect such determined White House backing for a pro-business
measure. At the same time some of Obama’s usual Democratic supporters
have been inclined to keep any opposition more subdued than it would be
otherwise, in deference to their party’s leader.

As initial public offerings diminished after the financial crisis,
concern grew late in the past decade that the trend might continue
without some government action. The cause was taken up by Obama’s
industry dominated Council on Competitiveness.

Nevertheless Democrats like Senators Levin, Reed, Dick Durbin and
Mary Landrieu were openly critical.

For organized labor, the JOBS Bill turned out to be one more defeat
and disappointment that even a Democratic White House could not be a
reliable ally. AFL-CIO President Richard Trumka said the White House
push made him “disappointed and angry.” His opposition did not cut into
the 73 Senate votes for the bill. “When the next bubble bursts,
Americans will know who to blame,” he said.

For regulators, the signing was a different kind of defeat. The
signal from the White House that regulatory concerns about the JOBS Act
are not a high priority comes in a year when development of Dodd-Frank
regulations is stretching the resources of independent financial
regulatory agencies like the SEC, CFTC and FDIC.

At the same time their efforts have been met with repeated industry
attacks. While getting steady support from Treasury Secretary Timothy
Geithner, the strong White House support for legislation they opposed
caught them by surprise.

The JOBS act exempts companies with less than $1 billion a year in
revenues from some disclosure and governance requirements as they make
initial public stock offerings. It allows companies to raise up to $1
million a year through the “crowdfunding” mechanism and frees them to
bypass normal registration requirements to solicit investors.

** MNI Washington Bureau: 202-371-2121 **

[TOPICS: MAUDS$,M$U$$$,MK$$$$,MGU$$$]

• NFP expected +205K vs +227K prior
• High est. +250K, low est +175K
• Three-month average of 245K
• Est. +215K private
• Unemployment rate est. unchanged at 8.3%,
• Unemployment est range 8.4-8.1%
• ADP was 209K vs 230K prior
• ISM non employment component 56.7 vs 55.7 in Feb
• ISM manufacturing employment 56.1 vs 53.2 prior
• Challenger announced layoffs were 8.8% lower than Feb
• Initial jobless claims virtually equal to Feb
• Trim Tabs estimates 187K with daily income tax deposit data

Take your guess here and win a ForexLive t-shirt.

The risk, to me, is that we see an unexpected rise in the unemployment rate. No matter what the NFP print is, a rise in unemployment would catch the market off guard and put QE3 back on the table.

It seems to me that the fall from 9.1% unemployment in August to 8.3% now is more than the job gains would indicate. Short USD/JPY would be the most straightforward way to position for that but be wary of any trades because the market will be very thin tomorrow.

Two weeks ago he pointed the finger at Spain, now he’s pointing it at everyone else but Italy, where domestic bank stocks were hit far harder than anywhere else this week.

He says recent market turmoil not related to Italy, linked to other EU countries and dissatisfaction over the firewall.

He sounds like Captain of the Costa Concordia.

European bank stocks experienced their worst one-week decline since December, and it only took 4 days.

• Italy’s Unicredit -11.9% on the week
• Banca Poplare di Milano -15.5%
• Banco Santander -6.2%
• BBVA -6.1%

Spain’s main IBEX 35 index touched the lowest in 7 months today and is perilously close to its post-credit-crisis low:

It’s not clear if rising sovereign yields cause bank stocks to fall or vice versa. Either way, it’s a reason to sell euros.

BlueGold, which was a highly touted commodity-investment fund launched in 2008, says it will liquidate and return money to investors.

This could cause a downdraft in commodities as other players try to front-run sales on their positions. BlueGold is/was  said to hold about $2 billion but it’s likely leveraged.

The last year has been a rocky ride at the fund. Stephen Jen, who was a superstar FX strategist at Morgan Stanley, left to join Bluegold in 2008, but he quit in October to start his own fund, SLJ Macro Partners.

–S&P’s Swann: Assume Sequestrations To Be Adhered To
–Moody’s Repeats Need More Deficit Reduction to Reverse Debt Trajectory

By Yali N’Diaye

WASHINGTON (MNI) – Rating agencies continue to monitor how Congress
and the Obama administration address high debt and deficit levels
especially at a time of still modest economic growth, the improving data
notwithstanding.

Last summer, the debt limit deal agreed by Congress under the
Budget Control Act included a sequestration mechanism that would become
effective should the Super Committee created by the legislation — to
craft a set of deficit reduction measures — fail to reach an agreement,
which it did.

As a result, in addition to caps on discretionary programs, the
sequesters — automatic spending cuts across the board amounting to $1.2
trillion over 10 years — will become effective from January 2013.

That is, if Congress does not decide otherwise.

And on that front, Egan-Jones President and Founding Principal Sean
Egan shows no confidence.

“We are not confident that the sequestrations will be implemented,”
he told MNI. “And even if they were, debt would probably grow faster
than GDP, thereby exacerbating the problem,” he said.

Egan-Jones Ratings cut the U.S. sovereign rating to ‘AA+’ from
‘AAA’ in July 2011, citing the “relatively high level of debt and the
difficulty in significantly cutting spending.”

At Standard & Poor’s, which cut the U.S. rating to ‘AA+’ in early
August 2011, the answer was less straightforward.

Asked whether he is confident the U.S. would implement the
sequestrations, Nikola Swann, analyst for the U.S. and Canada,
reiterated that Standard & Poor’s assumes in its base case scenario
“that the discretionary spending caps of the BCA (which include
sequestration) will be adhered to.”

Still, S&P’s outlook for the U.S. long-term rating is negative,
making it hard to believe they have high faith in a scenario where
sequestrations will be implemented.

When Fitch lowered the outlook from stable to negative for the U.S.
rating, it said this reflected its “declining confidence that timely
fiscal measures necessary to place U.S. public finances on a sustainable
path and secure the ‘AAA’ sovereign rating will be forthcoming.”

And “Moody’s currently has a negative outlook on the U.S. rating
given the need over time for further deficit reduction to reverse the
country’s upward debt trajectory,” a spokesman reaffirmed to MNI.

With upcoming elections, 2012 is unlikely to see the rating
agencies resolve their outlook.

Budget debates so far, however, do not reflect the compromising
approach that could improve the rating agencies’ confidence.

If you listen to House Speaker John Boehner and House Budget
Committee Chairman Paul Ryan, the budget that Ryan wrote and the House
approved last week is an aggressive fiscal plan that finally makes
desperately needed reforms to costly entitlement programs and begins to
limit out-of-control federal spending.

But if you listen to President Obama, Ryan’s budget is a reckless
and unbalanced fiscal framework that slashes the already frayed social
safety net while offering deep tax cuts for the wealthy.

And there is little, if any, hope on the economic front that
developments will significantly improve the budget picture, hence the
rating prospects.

“The recovery is tepid compared to most recoveries and has only a
marginal effect,” Egan told MNI. “The federal budget deficit in almost
all cases is likely to be in excess of $1 trillion per annum over the
next couple of years.”

“The rate of deterioration has slowed a bit with the improvement in
the U.S.’s economy, but debt is still growing faster than GDP,” he
pointed out.

“It is highly unlikely that the U.S. will experience the hyper
growth it saw in the early 1950′s when the U.S. was recovering from 18
years of suppressed growth and was the only developed economy with
productive capacity intact.”

In addition, “opportunities are being squandered while the funding
costs for the U.S. remain relatively low,” he continued.

In particular, Egan stressed that the Federal Reserve “cannot
continue purchasing U.S. Treasuries at the rate it has over the past
couple of years.”

** MNI Washington Bureau: 202-371-2121 **

[TOPICS: M$U$$$,MR$$$$,MFU$$$,M$$CR$]

Interesting but I won’t be putting the tinfoil hat on.

While the consistent need for upward revisions doesn’t undermine the overall trend of an improving job market, it does suggest that the government’s methodology for its initial estimate might not properly take into account factors such as seasonal adjustments or under-counting by states.