President Bush this morning said that an orderly bankruptcy is being considered for GM and Chrysler, perhaps involving government DIP funding to keep the companies out of Chapter 7. Chrysler has halted production until January 19, 2009. One wonders if they will ever restart it. GM has denied reports it is in renewed merger talks with Chrysler. S&P says GE runs a 1/3 risk of losing its AAA credit rating in the next two years. (Why hasn't it happened yet?)
Credit Suisse, in a genius move both from an accounting standpoint (helping to clear its balance sheet of bad assets) and for "correctly aligning incentives," will pay bonuses this year in its most illiquid and hard-to-value securities.
Initial jobless claims improved slightly over last week. 50% of home sales in the Bay Area are foreclosure resales.
Japan Economy Watch reviews the shrinking room for authorities to maneuver to try to start that country's economy. Neojaponisme looks at Prime Minister Aso Taro's plummeting popularity.
FT Alphaville point out that massive quantities of cheap dollars to borrow are the precondition to a run on the currency. Michael Shedlock points out the importance of recent interest rate actions by the Fed on the yield curve, and, by extension, the importance of the changes for lowering the costs of ARM-based mortgages.
Russian media are still keeping the economic situation in that country under wraps. Edward Lucas writes on the Latvian bailout.
China cut fuel prices by 14-18% today in a bid to reduce costs for manufacturers as inflation worries subside.
Robert Amsterdam looks at the negotiations between Gazprom and the Ukraine, as more than $1bn of debts between the two are disputed, and concludes that Gazprom may be fomenting a crisis between the two to flex its muscle (Like the 2006 New Year's Day supply cut). The stakes are particularly high as the IMF loan has not stopped the rapid depreciation of the Hyrvnia. In separate news, Russia will give Lebanon 10 MiG-29 jets as a gift, a direct threat to Israel and by extension the United States. MiG-29's are among the most advanced Russian fighters (they are a fourth-gen air superiority model), though Lebanon is unlikely to be able to challenge the Israel Air Force's equipment and training.
35 Iraqi officials, some with links to the counterterrorism bureau and most from Ministry of the Interior, have been accused of planning to refound the Baath Party and may have been in the early stages of planning a coup. Separately, the Iraqi government will likely not relicense Blackwater to deploy its mercenaries in Iraq in 2009. Increased requirements for warrants for U.S. forces in the new SOFA may restrict them from implementing cordon-and-search operations, a cornerstone of the tactical arsenal under Petraeus.
Bernard Kouchner has warned that European NATO members will face a difficult choice next year if Barack Obama asks for more troops for Afghanistan.
Obama is reportedly planning to nominate Republican congressman Ray LaHood (R-IL) as transportation secretary. Mary Schapiro, currently the CEO of the securities' industry's self-regulatory organization FINRA (ex NASD), will be his nominee for SEC chairman.
Obama told Time magazine he intends to close Guantanamo Bay within two years of his inauguration -- but, infuriatingly, defends waterboarding.
The Oil Drum has a fantastic in-depth post examining whether the UK will face a natural gas shortage this winter-yes is the answer, but what is most worhtwhile for an interested outsider is seeing how short-term demand forecasting is done. The format and depth of analysis here is very similar to what underlies decision-making at a regulatory level.
Green Car Congress discusses the particulars of the new EIA oil demand forecast.
The National Academy of Sciences has published a new report urging Cumulative Risk Assessments to be made for the long-term exposure of children and adults to phthalates, a class of chemicals used as additives in certain plastics and linked with endocrinal disorders, particularly in children exposed to low long-term doses through leakage.