Morning Economic News - December 15, 2008

Commentary and Overnight Trading

Markets seem to be liking the news over the weekend, at least somewhat, as the Nikkei average is up 5.21%, the Hang Seng is up 3.07% and the S&P/ASX200 is up 2.31%. US stock market futures are up about three-quarter percent. Oil prices are up and the dollar is down against the Canadian dollar, euro, pound and yen. [1:40 AM Easterm]

Weekly Financial Roadmap

Financial Roadmap: The Week Ahead December 15 to 19, 2008

While there are plenty of economic numbers due out this week, weak
reports are almost such a foregone conclusion for several – especially
those related to new home construction and industrial production – that
watching them is a more a matter of staying in practice than looking
for any real insight. Two numbers due out early in the week will be
worth watching because they will give some indication of just how much
leeway the government has with all the fiscal stimulus and bailout
spending before it begins to impact the value of the dollar – Treasury
International Capital and CPI.

Friday's Economic News

Retail Sales - November 2008

• Total Retail and Food Service Sales Annual Change: Down 7.4%


• Retail Sales Monthly: Down 2%

Producer Price Index - November 2008

• Finished Goods Index: Down 2.2%


• Finished Goods Core: Up 0.1%


• Intermediate Goods Index: Down 4.3%


• Crude Goods Index: Down 12.5%

What I'm Reading

OPEC in Race Against Falling Prices

OPEC ministers meeting in Algeria this week could cut as much as two million barrels a day from oil production

Target Rate Could Be Sliced to Near Zero

The Federal Reserve is expected to cut the fed-funds target
rate to levels not seen in decades, but that is unlikely to impress
Treasury-market investors.

Annus Horribilis Climaxes in Anxiety as New Year's Economy Sees No Bottom This was the year the global economy
fell apart. Next year may not be that much better, as policy
makers try to put the pieces back together.

Japanese Business Confidence Plunges Most in 34 Years as Recession Deepens Sentiment among Japan’s largest
manufacturers fell the most in 34 years, signaling companies are
likely to cancel spending plans and cut more jobs, pushing the
economy further into recession.

Bank of Japan May Need to Cut Rate Again, Former Deputy Governor Muto Says The Bank of Japan may cut the
benchmark interest rate further to show its commitment to
countering a deepening recession and market turmoil, said Toshiro
Muto, a former central bank deputy governor.

China's Industrial Output Grows at Weakest Pace Since 1999 on Export Slump China’s industrial production grew at
the weakest pace in almost a decade as export growth collapsed,
increasing pressure on the government to do more to revive the
slumping economy.

Dollar Staggers as U.S. Unleashes Flood, Deficits Increase, Fed Cuts Rates The biggest foreign-exchange
strategists and investors say the best may be over for the dollar
after a four-month, 24 percent rally.

Singapore's Retail Sales Unexpectedly Decline as Recession Hurts Spending Singapore’s retail sales
unexpectedly fell in October as a deteriorating economy prompted
consumers to pare spending on vehicles, furniture and clothing.

Putin's Devaluation Delay Risks Russia's Industry as Exports Steal Share Russian Prime Minister Vladimir
Putin’s pledge to avoid a “sharp” devaluation of the ruble and
let the currency fall gradually has dissuaded citizens from
storming banks to withdraw their savings as they did during the
crisis of 1998.

U.K. House Prices Will Drop 10% in 2009 as Recession Bites, Rightmove Says U.K. house prices extended declines
in December and will drop a further 10 percent next year as the
recession batters the British economy, Rightmove Plc said.

Treasury Benefits From `Massive Paranoia' as Bailout Borrowing Cost Falls Bill Clinton was forced to abandon
spending initiatives to boost the economy at the start of his
presidency when advisors warned him that the borrowing needed to
fund the programs would push interest rates higher. President-
elect Barack Obama may not have the same problem.

Japan's Business Confidence Falls Most in 34 Years: Table of the Day Following is the summary table
for the Tankan survey from the Bank of Japan in Tokyo.

Indonesian president announces cuts in fuel prices