DETROIT BANKRUPT

This may cause a few global repercussions wrt finance as well.

Benson,  if your talking Detroit and Wayne county,  then I think your talking about buying low and selling for even lower whilst getting your properties vandalised etc…. Not that one could not make a go of it in Detroit.. the locals can and do but you cannot do it from your arm chair in AU.  In my humble opinion.  I tried to post  a hyperlink for a few good Detroit articles but for some reason does not work on this site… A lot of good articles floating about right now that will give you the history of Detroit and other Rust best cities and why Detroit has not and probably will never return.. Cannot save never but 99% sure it won't in any of our life times…  There simply is too many existiing homes. The population of Detoit is 83% black and the racial tensions are still alive and well.  Surrounding suburbs were the white flight went may stand a chance.. However I for one still think the Sun belt and West Coast is a better play than anything in the Rust Belt.

HI Freckle, what are your thoughts on the A$ v US$ ? The admission from the US that they need to continue with the stimulus did not seem to have a major effect, i would have thought it would have put the A$ back at 97 odd?

thanks for your comments Freckle. I appreciate your time to answer the question. I did not really understand the taper term so for others that may also not be familiar with this term see below                                Federal Reserve officials really don’t like the word “tapering” — one of the most popular buzzwords in the markets these days.

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The Federal Reserve building in Washington.The Merriam-Webster dictionary defines the verb to taper as “to become progressively smaller toward one end.”

Stock and bond market investors and many television commentators regularly use tapering as shorthand for the Fed gradually reducing its monthly bond purchases.

The hangup for Fed officials is the word “tapering” suggests a slow, steady and predictable reduction from the current level of $85 billion a month at a succession of Fed meetings, say to $65 billion per month, then to $45 billion and so on. And that’s not necessarily what Fed officials envision.

Because Fed officials are uncertain about the economic outlook and the pros and cons of their own program, they might reduce their bond purchases once and then do nothing for a while. Or they might cut their bond buying once and then later increase it if the economy falters. Or they might indeed reduce their purchases in a series of steps if warranted by economic developments — but they don’t want the markets to think that’s a set plan. It is, as Fed officials like to say, “data dependent.”

That’s why the Fed’s most senior officials avoid the word. Fed Chairman Ben Bernanke never uttered the word “taper” in his March press conference; nor did he use it in more than two hours of congressional testimony last month. Instead, he said then, “in the next few meetings, we could take a step down in our pace of purchases.”

New York Fed president William Dudley also has been avoiding the word. Instead, he’s talked about wanting to “reduce the pace at which we are adding accommodation through asset purchases.”

Nevertheless, analysts can’t stop talking about tapering.

“Before today’s number our call for a first tapering was on a knife-edge between September and December,” J.P. Morgan economist Michael Feroli said in a note to clients Friday morning;

“No Tapering (Yet) by the Fed,” IHS Global Insight economist Nariman Behravesh said;

“Liquidity bulls gashed by Fed tapering fears,” said Bank of America investment strategist Michael Hartnett.

To be fair, the analysts became attached to the word taper after it was used a few times by the Fed itself.

The term showed up twice in minutes to the Fed’s March policy meeting. It showed up once in the April minutes, though then it was only associated with Fed dissenter Esther George, president of the Kansas City Fed, who wanted to end the bond-buying program then.

The Fed has fought rhetorical battles with investors in the past and lost.  Officials disliked the obscure term “quantitative easing,” often used in the markets to describe their bond buying program. Instead officials tried an equally obscure term, long-term asset purchases, to describe it. But the market has stuck with quantitative easing, or QE.

It will likely lose the battle over the term “tapering.” But don’t expect to hear the term cross Mr. Bernanke’s lips.