News You Can Use for Thursday

Interesting. US economists dismiss rumors that China may actually start selling its US-dollar denominated forex holdings (US Treasuries) ...

Benjamin Reitzes of BMO Financial Group (NYSE:BMO) says China holds between 60 and 70 pct of its foreign exchange reserves in dollars, and is thus unlikely to begin selling. 'If China were to start a fire sale of its US$-assets, it would face prohibitive losses,' Reitzes wrote today. ' A more likely scenario would be forChina to stop accumulating US dollars, not an outright sale.' He also predicted that further declines in the greenback could lead to a new accord aimed at shoring up the struggling currency.

Marc Chandler of Brown Brothers Harriman is even more dismissive, saying comments made today 'most likely do not reflect policy,' in part because of who made them. 'Cheng Siwei who talked about what the PBOC should do with reserves has in the past made errant remarks that have no bearing on policy,' Chandler said, citing past remarks in which Cheng has proposed that China stop buying US treasuries.

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South African Gold Mining Production Continues to Fall. South African gold production continued its decline by falling 6.5 percent in September compared with the same month last year, Statistics South Africa (Stats SA) said on Thursday.

Furthermore, gold production after seasonal adjustment decreased by 0.8 percent for September 2007 when compared with August 2007.

Also ...

Crude Retreats After Better-Than-Expected Inventory Data.

Crude prices took a break on their march towards $100 Wednesday, retreating $0.33 to $96.37 on the New York Mercantile Exchange, after the Energy Information Administration's weekly inventory report indicated that crude supplies fell by 800,000 bbls. last week, just half the anticipated 1.6M bbls. decline.

One economist said the report "wasn't bad enough" given the sharp drops expected by the market, and that had supplies fallen by 3M-5M bbls., crude could have gushed past $100. Meanwhile, traders who bought crude around $80 less than a month ago may be looking to cash out even though it's practically a given the century mark will be reached.

"We certainly would not risk $16 or more for the last $2 or $3 a barrel," one oil analyst told clients. "Because of this, we have to expect to see a number of professional traders take profits before we actually see $100."

Earlier in the day, futures had touched a new trading high of $98.62/bbl. after the International Energy Agency predicted that worldwide energy usage would rise 50% by 2030, with 45% of that demand coming from India and China.

Despite the overall stretched supply of world oil resources, some are surprised record prices are being set just now, a period generally characteristic of slack demand between the summer cooling and winter heating seasons.

And now, let's look at what's happening in Brazil ...

Brazil Soybean, Sugar-Cane Production Forecast to Rise to Records in 2008 Brazil's sugar-cane crop will rise to a record in 2008 as rising demand for ethanol made from the tropical plant encouraged planting, the government's statistics agency said.

Interestingly enough ...

Brazil's Real Rises to Near 7-Year vs Dollar High on Bets of Higher Flows Brazil's real rose to near a seven- year high on speculation foreign investment flows to local bonds and stocks will rise.

How 'Bout Those Asian Markets? Beginning of the Big Slide or Buying Opportunity? You Tell me!

Asian Stocks Drop Most in 12 Weeks as Dollar Slides, Subprime-Losses Mount Asian stocks fell the most in 12 weeks, extending a global rout after the dollar plunged yesterday, oil slumped and U.S. financial companies disclosed mounting credit-market losses.

The Natural Resource Feeding Frenzy Kicks It Up a Notch!

BHP Billiton Plans to Pursue Rio Tinto Bid, Might Be Biggest Takeover Ever BHP Billiton Ltd., the world's biggest mining company, plans to pursue a takeover of Rio Tinto Group after an earlier approach was rejected, in what may become the largest acquisition in history.

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